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Justice Powell | dissenting | false | Garcia v. San Antonio Metropolitan Transit Authority | 1985-04-15T00:00:00 | null | https://www.courtlistener.com/opinion/111308/garcia-v-san-antonio-metropolitan-transit-authority/ | https://www.courtlistener.com/api/rest/v3/clusters/111308/ | 1,985 | 1984-029 | 2 | 5 | 4 | The Court today, in its 5-4 decision, overrules National League of Cities v. Usery, 426 U.S. 833 (1976), a case in which we held that Congress lacked authority to impose the requirements of the Fair Labor Standards Act on state and local governments. Because I believe this decision substantially alters the federal system embodied in the Constitution, I dissent.
I
There are, of course, numerous examples over the history of this Court in which prior decisions have been reconsidered and overruled. There have been few cases, however, in which the principle of stare decisis and the rationale of recent *558 decisions were ignored as abruptly as we now witness.[1] The reasoning of the Court in National League of Cities, and the principle applied there, have been reiterated consistently over the past eight years. Since its decision in 1976, National League of Cities has been cited and quoted in opinions joined by every Member of the present Court. Hodel v. Virginia Surface Mining & Recl. Assn., 452 U.S. 264, 287-293 (1981); Transportation Union v. Long Island R. Co., 455 U.S. 678, 684-686 (1982); FERC v. Mississippi, 456 U.S. 742, 764-767 (1982). Less than three years ago, in Long Island R. Co., supra, a unanimous Court reaffirmed the principles of National League of Cities but found them inapplicable to the regulation of a railroad heavily engaged in interstate commerce. The Court stated:
"The key prong of the National League of Cities test applicable to this case is the third one [repeated and reformulated in Hodel], which examines whether `the States' compliance with the federal law would directly impair their ability "to structure integral operations in areas of traditional governmental functions." ' " 455 U.S., at 684.
The Court in that case recognized that the test "may at times be a difficult one," ibid., but it was considered in that unanimous decision as settled constitutional doctrine.
As recently as June 1, 1982, the five Justices who constitute the majority in these cases also were the majority in FERC v. Mississippi. In that case, the Court said:
"In National League of Cities v. Usery, supra, for example, the Court made clear that the State's regulation of its relationship with its employees is an `undoubted attribute of state sovereignty.' 426 U.S., at 845. Yet, *559 by holding `unimpaired' California v. Taylor, 353 U.S. 553 (1957), which upheld a federal labor regulation as applied to state railroad employees, 426 U.S., at 854, n. 18, National League of Cities acknowledged that not all aspects of a State's sovereign authority are immune from federal control." 456 U.S., at 764, n. 28.
The Court went on to say that even where the requirements of the National League of Cities standard are met, " `[t]here are situations in which the nature of the federal interest advanced may be such that it justifies state submission.' " Ibid., quoting Hodel, supra, at 288, n. 29. The joint federal/state system of regulation in FERC was such a "situation," but there was no hint in the Court's opinion that National League of Cities or its basic standard was subject to the infirmities discovered today.
Although the doctrine is not rigidly applied to constitutional questions, "any departure from the doctrine of stare decisis demands special justification." Arizona v. Rumsey, 467 U.S. 203, 212 (1984). See also Oregon v. Kennedy, 456 U.S. 667, 691-692, n. 34 (1982) (STEVENS, J., concurring in judgment). In the present cases, the five Justices who compose the majority today participated in National League of Cities and the cases reaffirming it.[2] The stability of judicial decision, and with it respect for the authority of this Court, are not served by the precipitate overruling of multiple precedents that we witness in these cases.[3]
Whatever effect the Court's decision may have in weakening the application of stare decisis, it is likely to be less *560 important than what the Court has done to the Constitution itself. A unique feature of the United States is the federal system of government guaranteed by the Constitution and implicit in the very name of our country. Despite some genuflecting in the Court's opinion to the concept of federalism, today's decision effectively reduces the Tenth Amendment to meaningless rhetoric when Congress acts pursuant to the Commerce Clause. The Court holds that the Fair Labor Standards Act (FLSA) "contravened no affirmative limit on Congress' power under the Commerce Clause" to determine the wage rates and hours of employment of all state and local employees. Ante, at 556. In rejecting the traditional view of our federal system, the Court states:
"Apart from the limitation on federal authority inherent in the delegated nature of Congress' Article I powers, the principal means chosen by the Framers to ensure the role of the States in the federal system lies in the structure of the Federal Government itself." Ante, at 550 (emphasis added).
To leave no doubt about its intention, the Court renounces its decision in National League of Cities because it "inevitably invites an unelected federal judiciary to make decisions about which state policies its favors and which ones it dislikes." Ante, at 546. In other words, the extent to which the States may exercise their authority, when Congress purports to act under the Commerce Clause, henceforth is to be determined from time to time by political decisions made by members of the Federal Government, decisions the Court says will not be subject to judicial review. I note that it does not seem to have occurred to the Court that it an unelected majority of five Justices today rejects almost 200 years of the understanding of the constitutional status of federalism. In doing so, there is only a single passing reference to the Tenth Amendment. Nor is so much as a dictum of any court cited in support of the view that the role of the States in the federal system may depend upon *561 the grace of elected federal officials, rather than on the Constitution as interpreted by this Court.
In my opinion that follows, Part II addresses the Court's criticisms of National League of Cities. Part III reviews briefly the understanding of federalism that ensured the ratification of the Constitution and the extent to which this Court, until today, has recognized that the States retain a significant measure of sovereignty in our federal system. Part IV considers the applicability of the FLSA to the indisputably local service provided by an urban transit system.
II
The Court finds that the test of state immunity approved in National League of Cities and its progeny is unworkable and unsound in principle. In finding the test to be unworkable, the Court begins by mischaracterizing National League of Cities and subsequent cases. In concluding that efforts to define state immunity are unsound in principle, the Court radically departs from long-settled constitutional values and ignores the role of judicial review in our system of government.
A
Much of the Court's opinion is devoted to arguing that it is difficult to define a priori "traditional governmental functions." National League of Cities neither engaged in, nor required, such a task.[4] The Court discusses and condemns *562 as standards "traditional governmental functions," "purely historical" functions, " `uniquely' governmental functions," and " `necessary' governmental services." Ante, at 539, 543, 545. But nowhere does it mention that National League of Cities adopted a familiar type of balancing test for determining whether Commerce Clause enactments transgress constitutional limitations imposed by the federal nature of our system of government. This omission is noteworthy, since the author of today's opinion joined National League of Cities and concurred separately to point out that the Court's opinion in that case "adopt[s] a balancing approach [that] does not outlaw federal power in areas . . . where the federal interest is demonstrably greater and where state . . . compliance with imposed federal standards would be essential." 426 U.S., at 856 (BLACKMUN, J., concurring).
In reading National League of Cities to embrace a balancing approach, JUSTICE BLACKMUN quite correctly cited the part of the opinion that reaffirmed Fry v. United States, 421 U.S. 542 (1975). The Court's analysis reaffirming Fry explicitly weighed the seriousness of the problem addressed by the federal legislation at issue in that case, against the effects of compliance on state sovereignty. 426 U.S., at 852-853. Our subsequent decisions also adopted this approach of weighing the respective interests of the States and Federal *563 Government.[5] In EEOC v. Wyoming, 460 U.S. 226 (1983), for example, the Court stated that "[t]he principle of immunity articulated in National League of Cities is a functional doctrine . . . whose ultimate purpose is not to create a sacred province of state autonomy, but to ensure that the unique benefits of a federal system . . . not be lost through undue federal interference in certain core state functions." Id., at 236. See also Hodel v. Virginia Surface Mining & Recl. Assn., 452 U.S. 264 (1981). In overruling National League of Cities, the Court incorrectly characterizes the mode of analysis established therein and developed in subsequent cases.[6]
*564 Moreover, the statute at issue in this case, the FLSA, is the identical statute that was at issue in National League of Cities. Although JUSTICE BLACKMUN's concurrence noted that he was "not untroubled by certain possible implications of the Court's opinion" in National League of Cities, it also stated that "the result with respect to the statute under challenge here [the FLSA] is necessarily correct." 426 U.S., at 856 (emphasis added). His opinion for the Court today does not discuss the statute, nor identify any changed circumstances that warrant the conclusion today that National League of Cities is necessarily wrong.
B
Today's opinion does not explain how the States' role in the electoral process guarantees that particular exercises of the Commerce Clause power will not infringe on residual state sovereignty.[7] Members of Congress are elected from the various States, but once in office they are Members of the *565 Federal Government.[8] Although the States participate in the Electoral College, this is hardly a reason to view the President as a representative of the States' interest against federal encroachment. We noted recently "[t]he hydraulic pressure inherent within each of the separate Branches to exceed the outer limits of its power . . . ." INS v. Chadha, 462 U.S. 919, 951 (1983). The Court offers no reason to think that this pressure will not operate when Congress seeks to invoke its powers under the Commerce Clause, notwithstanding the electoral role of the States.[9]
*566 The Court apparently thinks that the States' success at obtaining federal funds for various projects and exemptions from the obligations of some federal statutes is indicative of the "effectiveness of the federal political process in preserving the States' interests. . . ." Ante, at 552.[10] But such political success is not relevant to the question whether the political processes are the proper means of enforcing constitutional limitations.[11] The fact that Congress generally *567 does not transgress constitutional limits on its power to reach state activities does not make judicial review any less necessary to rectify the cases in which it does do so.[12] The States' role in our system of government is a matter of constitutional law, not of legislative grace. "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States, respectively, or to the people." U. S. Const., Amdt. 10.
More troubling than the logical infirmities in the Court's reasoning is the result of its holding, i. e., that federal political officials, invoking the Commerce Clause, are the sole judges of the limits of their own power. This result is inconsistent with the fundamental principles of our constitutional system. See, e. g., The Federalist No. 78 (Hamilton). At least since Marbury v. Madison, 1 Cranch 137, 177 (1803), it has been the settled province of the federal judiciary "to say what the law is" with respect to the constitutionality of Acts of Congress. In rejecting the role of the judiciary in protecting the States from federal overreaching, the Court's opinion offers no explanation for ignoring the teaching of the most famous case in our history.[13]
*568 III
A
In our federal system, the States have a major role that cannot be pre-empted by the National Government. As contemporaneous writings and the debates at the ratifying conventions make clear, the States' ratification of the Constitution was predicated on this understanding of federalism. Indeed, the Tenth Amendment was adopted specifically to ensure that the important role promised the States by the proponents of the Constitution was realized.
Much of the initial opposition to the Constitution was rooted in the fear that the National Government would be too powerful and eventually would eliminate the States as viable political entities. This concern was voiced repeatedly until proponents of the Constitution made assurances that a Bill of Rights, including a provision explicitly reserving powers in the States, would be among the first business of the new Congress. Samuel Adams argued, for example, that if the several States were to be joined in "one entire Nation, under one Legislature, the Powers of which shall extend to every Subject of Legislation, and its Laws be supreme & controul the whole, the Idea of Sovereignty in these States must be lost." Letter from Samuel Adams to Richard Henry Lee (Dec. 3, 1787), reprinted in Anti-Federalists versus Federalists *569 159 (J. Lewis ed. 1967). Likewise, George Mason feared that "the general government being paramount to, and in every respect more powerful than the state governments, the latter must give way to the former." Address in the Ratifying Convention of Virginia (June 4-12, 1788), reprinted in Anti-Federalists versus Federalists, supra, at 208-209.
Antifederalists raised these concerns in almost every state ratifying convention.[14] See generally 1-4 Debates in the Several State Conventions on the Adoption of the Federal Constitution (J. Elliot 2d. ed. 1876). As a result, eight States voted for the Constitution only after proposing amendments to be adopted after ratification.[15] All eight of these included among their recommendations some version of what later became the Tenth Amendment. Ibid. So strong was the concern that the proposed Constitution was seriously defective without a specific bill of rights, including a provision reserving powers to the States, that in order to secure the votes for ratification, the Federalists eventually conceded that such provisions were necessary. See 1 B. Schwartz, The Bill of Rights: A Documentary History 505 and passim (1971). It was thus generally agreed that consideration of a bill of rights would be among the first business of the new Congress. See generally 1 Annals of Cong. 432-437 (1789) (remarks of James Madison). Accordingly, the 10 Amendments that we know as the Bill of Rights were proposed and adopted early in the first session of the First Congress. 2 Schwartz, The Bill of Rights, supra, at 983-1167.
*570 This history, which the Court simply ignores, documents the integral role of the Tenth Amendment in our constitutional theory. It exposes as well, I believe, the fundamental character of the Court's error today. Far from being "unsound in principle," ante, at 546, judicial enforcement of the Tenth Amendment is essential to maintaining the federal system so carefully designed by the Framers and adopted in the Constitution.
B
The Framers had definite ideas about the nature of the Constitution's division of authority between the Federal and State Governments. In The Federalist No. 39, for example, Madison explained this division by drawing a series of contrasts between the attributes of a "national" government and those of the government to be established by the Constitution. While a national form of government would possess an "indefinite supremacy over all persons and things," the form of government contemplated by the Constitution instead consisted of "local or municipal authorities [which] form distinct and independent portions of the supremacy, no more subject within their respective spheres to the general authority, than the general authority is subject to them, within its own sphere." Id., at 256 (J. Cooke ed. 1961). Under the Constitution, the sphere of the proposed government extended to jurisdiction of "certain enumerated objects only, . . . leav[ing] to the several States a residuary and inviolable sovereignty over all other objects." Ibid.
Madison elaborated on the content of these separate spheres of sovereignty in The Federalist No. 45:
"The powers delegated by the proposed Constitution to the Federal Government, are few and defined. Those which are to remain in the State Governments are numerous and indefinite. The former will be exercised principally on external objects, as war, peace, negociation, and foreign commerce . . . . The powers *571 reserved to the several States will extend to all the objects, which, in the ordinary course of affairs, concern the lives, liberties and properties of the people; and the internal order, improvement, and prosperity of the State." Id., at 313 (J. Cooke ed. 1961).
Madison considered that the operations of the Federal Government would be "most extensive and important in times of war and danger; those of the State Governments in times of peace and security." Ibid. As a result of this division of powers, the state governments generally would be more important than the Federal Government. Ibid.
The Framers believed that the separate sphere of sovereignty reserved to the States would ensure that the States would serve as an effective "counterpoise" to the power of the Federal Government. The States would serve this essential role because they would attract and retain the loyalty of their citizens. The roots of such loyalty, the Founders thought, were found in the objects peculiar to state government. For example, Hamilton argued that the States "regulat[e] all those personal interests and familiar concerns to which the sensibility of individuals is more immediately awake . . . ." The Federalist No. 17, p. 107 (J. Cooke ed. 1961). Thus, he maintained that the people would perceive the States as "the immediate and visible guardian of life and property," a fact which "contributes more than any other circumstance to impressing upon the minds of the people affection, esteem and reverence towards the government." Ibid. Madison took the same position, explaining that "the people will be more familiarly and minutely conversant" with the business of state governments, and "with the members of these, will a greater proportion of the people have the ties of personal acquaintance and friendship, and of family and party attachments . . . ." The Federalist No. 46, p. 316 (J. Cooke ed. 1961). Like Hamilton, Madison saw the States' involvement in the everyday concerns of the people as the source of *572 their citizens' loyalty. Ibid. See also Nagel, Federalism as a Fundamental Value: National League of Cities in Perspective, 1981 S. Ct. Rev. 81.
Thus, the harm to the States that results from federal overreaching under the Commerce Clause is not simply a matter of dollars and cents. National League of Cities, 426 U. S., at 846-851. Nor is it a matter of the wisdom or folly of certain policy choices. Cf. ante, at 546. Rather, by usurping functions traditionally performed by the States, federal overreaching under the Commerce Clause undermines the constitutionally mandated balance of power between the States and the Federal Government, a balance designed to protect our fundamental liberties.
C
The emasculation of the powers of the States that can result from the Court's decision is predicated on the Commerce Clause as a power "delegated to the United States" by the Constitution. The relevant language states: "Congress shall have power . . . To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." Art. I, § 8, cl. 3. Section 8 identifies a score of powers, listing the authority to lay taxes, borrow money on the credit of the United States, pay its debts, and provide for the common defense and the general welfare before its brief reference to "Commerce." It is clear from the debates leading up to the adoption of the Constitution that the commerce to be regulated was that which the States themselves lacked the practical capability to regulate. See, e. g., 1 M. Farrand, The Records of the Federal Convention of 1787 (rev. ed. 1937); The Federalist Nos. 7, 11, 22, 42, 45. See also EEOC v. Wyoming, 460 U.S. 226, 265 (1983) (POWELL, J., dissenting). Indeed, the language of the Clause itself focuses on activities that only a National Government could regulate: commerce with foreign nations and Indian tribes and "among" the several States.
*573 To be sure, this Court has construed the Commerce Clause to accommodate unanticipated changes over the past two centuries. As these changes have occurred, the Court has had to decide whether the Federal Government has exceeded its authority by regulating activities beyond the capability of a single State to regulate or beyond legitimate federal interests that outweighed the authority and interests of the States. In so doing, however, the Court properly has been mindful of the essential role of the States in our federal system.
The opinion for the Court in National League of Cities was faithful to history in its understanding of federalism. The Court observed that "our federal system of government imposes definite limits upon the authority of Congress to regulate the activities of States as States by means of the commerce power." 426 U.S., at 842. The Tenth Amendment was invoked to prevent Congress from exercising its " `power in a fashion that impairs the States' integrity or their ability to function effectively in a federal system.' " Id., at 842-843 (quoting Fry v. United States, 421 U. S., at 547, n. 7).
This Court has recognized repeatedly that state sovereignty is a fundamental component of our system of government. More than a century ago, in Lane County v. Oregon, 7 Wall. 71 (1869), the Court stated that the Constitution recognized "the necessary existence of the States, and, within their proper spheres, the independent authority of the States." It concluded, as Madison did, that this authority extended to "nearly the whole charge of interior regulation. . . ; to [the States] and to the people all powers not expressly delegated to the national government are reserved." Id., at 76. Recently, in Community Communications Co. v. Boulder, 455 U.S. 40, 53 (1982), the Court recognized that the state action exemption from the antitrust laws was based on state sovereignty. Similarly, in Transportation Union v. Long Island R. Co., 455 U. S., at 683, although finding the Railway Labor Act applicable to a state-owned railroad, the *574 unanimous Court was careful to say that the States possess constitutionally preserved sovereign powers.
Again, in FERC v. Mississippi, 456 U.S. 742, 752 (1982), in determining the constitutionality of the Public Utility Regulatory Policies Act, the Court explicitly considered whether the Act impinged on state sovereignty in violation of the Tenth Amendment. These represent only a few of the many cases in which the Court has recognized not only the role, but also the importance, of state sovereignty. See also, e. g., Fry v. United States, supra; Metcalf & Eddy v. Mitchell, 269 U.S. 514 (1926); Coyle v. Oklahoma, 221 U.S. 559 (1911). As Justice Frankfurter noted, the States are not merely a factor in the "shifting economic arrangements" of our country, Kovacs v. Cooper, 336 U.S. 77, 95 (1949) (concurring), but also constitute a "coordinate element in the system established by the Framers for governing our Federal Union." National League of Cities, supra, at 849.
D
In contrast, the Court today propounds a view of federalism that pays only lipservice to the role of the States. Although it says that the States "unquestionably do `retai[n] a significant measure of sovereign authority,' " ante, at 549 (quoting EEOC v. Wyoming, supra, at 269 (POWELL, J., dissenting)), it fails to recognize the broad, yet specific areas of sovereignty that the Framers intended the States to retain. Indeed, the Court barely acknowledges that the Tenth Amendment exists.[16] That Amendment states explicitly that "[t]he powers not delegated to the United States . . . are reserved to the States." The Court recasts this language to say that the States retain their sovereign powers "only to the extent that the Constitution has not divested them of their original powers and transferred those powers to the Federal *575 Government." Ante, at 549. This rephrasing is not a distinction without a difference; rather, it reflects the Court's unprecedented view that Congress is free under the Commerce Clause to assume a State's traditional sovereign power, and to do so without judicial review of its action. Indeed, the Court's view of federalism appears to relegate the States to precisely the trivial role that opponents of the Constitution feared they would occupy.[17]
In National League of Cities, we spoke of fire prevention, police protection, sanitation, and public health as "typical of [the services] performed by state and local governments in discharging their dual functions of administering the public law and furnishing public services." 426 U.S., at 851. Not only are these activities remote from any normal concept of interstate commerce, they are also activities that epitomize the concerns of local, democratic self-government. See n. 5, supra. In emphasizing the need to protect traditional governmental functions, we identified the kinds of activities engaged in by state and local governments that affect the everyday lives of citizens. These are services that people are in a position to understand and evaluate, and in a democracy, have the right to oversee.[18] We recognized that "it is *576 functions such as these which governments are created to provide . . ." and that the States and local governments are better able than the National Government to perform them. 426 U.S., at 851.
The Court maintains that the standard approved in National League of Cities "disserves principles of democratic self-governance." Ante, at 547. In reaching this conclusion, the Court looks myopically only to persons elected to positions in the Federal Government. It disregards entirely the far more effective role of democratic self-government at the state and local levels. One must compare realistically the operation of the state and local governments with that of the Federal Government. Federal legislation is drafted primarily by the staffs of the congressional committees. In view of the hundreds of bills introduced at each session of Congress and the complexity of many of them, it is virtually impossible for even the most conscientious legislators to be truly familiar with many of the statutes enacted. Federal departments and agencies customarily are authorized to write regulations. Often these are more important than the text of the statutes. As is true of the original legislation, these are drafted largely by staff personnel. The administration and enforcement of federal laws and regulations necessarily are largely in the hands of staff and civil service employees. These employees may have little or no knowledge of the States and localities that will be affected by the statutes and regulations for which they are responsible. In any case, they hardly are as accessible and responsive *577 as those who occupy analogous positions in state and local governments.
In drawing this contrast, I imply no criticism of these federal employees or the officials who are ultimately in charge. The great majority are conscientious and faithful to their duties. My point is simply that members of the immense federal bureaucracy are not elected, know less about the services traditionally rendered by States and localities, and are inevitably less responsive to recipients of such services, than are state legislatures, city councils, boards of supervisors, and state and local commissions, boards, and agencies. It is at these state and local levels not in Washington as the Court so mistakenly thinks that "democratic self-government" is best exemplified.
IV
The question presented in these cases is whether the extension of the FLSA to the wages and hours of employees of a city-owned transit system unconstitutionally impinges on fundamental state sovereignty. The Court's sweeping holding does far more than simply answer this question in the negative. In overruling National League of Cities, today's opinion apparently authorizes federal control, under the auspices of the Commerce Clause, over the terms and conditions of employment of all state and local employees. Thus, for purposes of federal regulation, the Court rejects the distinction between public and private employers that had been drawn carefully in National League of Cities. The Court's action reflects a serious misunderstanding, if not an outright rejection, of the history of our country and the intention of the Framers of the Constitution.[19]
*578 I return now to the balancing test approved in National League of Cities and accepted in Hodel, Long Island R. Co., and FERC v. Mississippi. See n. 5, supra. The Court does not find in these cases that the "federal interest is demonstrably greater." 426 U.S., at 856 (BLACKMUN, J., concurring). No such finding could have been made, for the state interest is compelling. The financial impact on States and localities of displacing their control over wages, hours, overtime regulations, pensions, and labor relations with their employees could have serious, as well as unanticipated, effects on state and local planning, budgeting, and the levying of taxes.[20] As we said in National League of Cities, federal control of the terms and conditions of employment of state employees also inevitably "displaces state policies regarding the manner in which [States] will structure delivery of those governmental services that citizens require." Id., at 847.
The Court emphasizes that municipal operation of an intracity mass transit system is relatively new in the life of our country. It nevertheless is a classic example of the type of service traditionally provided by local government. It is local by definition. It is indistinguishable in principle from the traditional services of providing and maintaining streets, public lighting, traffic control, water, and sewerage systems.[21] Services of this kind are precisely those with which citizens are more "familiarly and minutely conversant." The Federalist No. 46, p. 316 (J. Cooke ed. 1961). State and local officials of course must be intimately familiar with these services and sensitive to their quality as well as cost. Such *579 officials also know that their constituents and the press respond to the adequacy, fair distribution, and cost of these services. It is this kind of state and local control and accountability that the Framers understood would insure the vitality and preservation of the federal system that the Constitution explicitly requires. See National League of Cities, 426 U. S., at 847-852.
V
Although the Court's opinion purports to recognize that the States retain some sovereign power, it does not identify even a single aspect of state authority that would remain when the Commerce Clause is invoked to justify federal regulation. In Maryland v. Wirtz, 392 U.S. 183 (1968), overruled by National League of Cities and today reaffirmed, the Court sustained an extension of the FLSA to certain hospitals, institutions, and schools. Although the Court's opinion in Wirtz was comparatively narrow, Justice Douglas, in dissent, wrote presciently that the Court's reading of the Commerce Clause would enable "the National Government [to] devour the essentials of state sovereignty, though that sovereignty is attested by the Tenth Amendment." 392 U.S., at 205. Today's decision makes Justice Douglas' fear once again a realistic one.
As I view the Court's decision today as rejecting the basic precepts of our federal system and limiting the constitutional role of judicial review, I dissent. | The Court today, in its -4 decision, overrules National League of a case in which we held that Congress lacked authority to impose the requirements of the Fair Labor Standards Act on state and local governments. Because I believe this decision substantially alters the federal system embodied in the Constitution, I dissent. I There are, of course, numerous examples over the history of this Court in which prior decisions have been reconsidered and overruled. There have been few cases, however, in which the principle of stare decisis and the rationale of recent *8 decisions were ignored as abruptly as we now witness.[1] The reasoning of the Court in National League of and the principle applied there, have been reiterated consistently over the past eight years. Since its decision in 1976, National League of has been cited and quoted in opinions joined by every Member of the present Court. ; Transportation ; Less than three years ago, in Long Island R. a unanimous Court reaffirmed the principles of National League of but found them inapplicable to the regulation of a railroad heavily engaged in interstate commerce. The Court stated: "The key prong of the National League of test applicable to this case is the third one [repeated and reformulated in ], which examines whether `the ' compliance with the federal law would directly impair their ability "to structure integral operations in areas of traditional governmental functions." ' " The Court in that case recognized that the test "may at times be a difficult one," ibid., but it was considered in that unanimous decision as settled constitutional doctrine. As recently as June 1, 1982, the five Justices who constitute the majority in these cases also were the majority in In that case, the Court said: "In National League of for example, the Court made clear that the State's regulation of its relationship with its is an `undoubted attribute of state ' Yet, *9 by holding `unimpaired' which upheld a federal labor regulation as applied to state railroad n. 18, National League of acknowledged that not all aspects of a State's sovereign authority are immune from federal control." n. 28. The Court went on to say that even where the requirements of the National League of standard are met, " `[t]here are situations in which the nature of the federal interest advanced may be such that it justifies state submission.' " quoting The joint federal/state system of regulation in FERC was such a "situation," but there was no hint in the Court's opinion that National League of or its basic standard was subject to the infirmities discovered today. Although the doctrine is not rigidly applied to constitutional questions, "any departure from the doctrine of stare decisis demands special justification." See also In the present cases, the five Justices who compose the majority today participated in National League of and the cases reaffirming it.[2] The stability of judicial decision, and with it respect for the authority of this Court, are not served by the precipitate overruling of multiple precedents that we witness in these cases.[3] Whatever effect the Court's decision may have in weakening the application of stare decisis, it is likely to be less *60 important than what the Court has done to the Constitution itself. A unique feature of the United is the federal system of government guaranteed by the Constitution and implicit in the very name of our country. Despite some genuflecting in the Court's opinion to the concept of federalism, today's decision effectively reduces the Tenth Amendment to meaningless rhetoric when Congress acts pursuant to the Commerce Clause. The Court holds that the Fair Labor Standards Act (FLSA) "contravened no affirmative limit on Congress' power under the Commerce Clause" to determine the wage rates and hours of employment of all state and local Ante, at 6. In rejecting the traditional view of our federal system, the Court states: "Apart from the limitation on federal authority inherent in the delegated nature of Congress' Article I powers, the principal means chosen by the Framers to ensure the role of the in the federal system lies in the structure of the Federal Government itself." Ante, at 0 To leave no doubt about its intention, the Court renounces its decision in National League of because it "inevitably invites an unelected federal judiciary to make decisions about which state policies its favors and which ones it dislikes." Ante, at 46. In other words, the extent to which the may exercise their authority, when Congress purports to act under the Commerce Clause, henceforth is to be determined from time to time by political decisions made by members of the Federal Government, decisions the Court says will not be subject to judicial review. I note that it does not seem to have occurred to the Court that it an unelected majority of five Justices today rejects almost 200 years of the understanding of the constitutional status of federalism. In doing so, there is only a single passing reference to the Tenth Amendment. Nor is so much as a dictum of any court cited in support of the view that the role of the in the federal system may depend upon *61 the grace of elected federal officials, rather than on the Constitution as interpreted by this Court. In my opinion that follows, Part II addresses the Court's criticisms of National League of Part III reviews briefly the understanding of federalism that ensured the ratification of the Constitution and the extent to which this Court, until today, has recognized that the retain a significant measure of sovereignty in our federal system. Part IV considers the applicability of the FLSA to the indisputably local service provided by an urban transit system. II The Court finds that the test of state immunity approved in National League of and its progeny is unworkable and unsound in principle. In finding the test to be unworkable, the Court begins by mischaracterizing National League of and subsequent cases. In concluding that efforts to define state immunity are unsound in principle, the Court radically departs from long-settled constitutional values and ignores the role of judicial review in our system of government. A Much of the Court's opinion is devoted to arguing that it is difficult to define a priori "traditional governmental functions." National League of neither engaged in, nor required, such a task.[4] The Court discusses and condemns *62 as standards "traditional governmental functions," "purely historical" functions, " `uniquely' governmental functions," and " `necessary' governmental services." Ante, at 9, 43, 4. But nowhere does it mention that National League of adopted a familiar type of balancing test for determining whether Commerce Clause enactments transgress constitutional limitations imposed by the federal nature of our system of government. This omission is noteworthy, since the author of today's opinion joined National League of and concurred separately to point out that the Court's opinion in that case "adopt[s] a balancing approach [that] does not outlaw federal power in areas where the federal interest is demonstrably greater and where state compliance with imposed federal standards would be essential." In reading National League of to embrace a balancing approach, JUSTICE BLACKMUN quite correctly cited the part of the opinion that reaffirmed The Court's analysis reaffirming Fry explicitly weighed the seriousness of the problem addressed by the federal legislation at issue in that case, against the effects of compliance on state -8. Our subsequent decisions also adopted this approach of weighing the respective interests of the and Federal *63 Government.[] In for example, the Court stated that "[t]he principle of immunity articulated in National League of is a functional doctrine whose ultimate purpose is not to create a sacred province of state autonomy, but to ensure that the unique benefits of a federal system not be lost through undue federal interference in certain core state functions." See also In overruling National League of the Court incorrectly characterizes the mode of analysis established therein and developed in subsequent cases.[6] *64 Moreover, the statute at issue in this case, the FLSA, is the identical statute that was at issue in National League of Although JUSTICE BLACKMUN's concurrence noted that he was "not untroubled by certain possible implications of the Court's opinion" in National League of it also stated that "the result with respect to the statute under challenge here [the FLSA] is necessarily correct." His opinion for the Court today does not discuss the statute, nor identify any changed circumstances that warrant the conclusion today that National League of is necessarily wrong. B Today's opinion does not explain how the ' role in the electoral process guarantees that particular exercises of the Commerce Clause power will not infringe on residual state [7] Members of Congress are elected from the various but once in office they are Members of the *6 Federal Government.[8] Although the participate in the Electoral College, this is hardly a reason to view the President as a representative of the ' interest against federal encroachment. We noted recently "[t]he hydraulic pressure inherent within each of the separate Branches to exceed the outer limits of its power" The Court offers no reason to think that this pressure will not operate when Congress seeks to invoke its powers under the Commerce Clause, notwithstanding the electoral role of the[9] *66 The Court apparently thinks that the ' success at obtaining federal funds for various projects and exemptions from the obligations of some federal statutes is indicative of the "effectiveness of the federal political process in preserving the ' interests." Ante, at 2.[10] But such political success is not relevant to the question whether the political processes are the proper means of enforcing constitutional limitations.[11] The fact that Congress generally *67 does not transgress constitutional limits on its power to reach state activities does not make judicial review any less necessary to rectify the cases in which it does do so.[12] The ' role in our system of government is a matter of constitutional law, not of legislative grace. "The powers not delegated to the United by the Constitution, nor prohibited by it to the are reserved to the respectively, or to the people." U. S. Const., Amdt. 10. More troubling than the logical infirmities in the Court's reasoning is the result of its holding, i. e., that federal political officials, invoking the Commerce Clause, are the sole judges of the limits of their own power. This result is inconsistent with the fundamental principles of our constitutional system. See, e. g., The Federalist No. 78 (Hamilton). At least since it has been the settled province of the federal judiciary "to say what the law is" with respect to the constitutionality of Acts of Congress. In rejecting the role of the judiciary in protecting the from federal overreaching, the Court's opinion offers no explanation for ignoring the teaching of the most famous case in our history.[13] *68 III A In our federal system, the have a major role that cannot be pre-empted by the National Government. As contemporaneous writings and the debates at the ratifying conventions make clear, the ' ratification of the Constitution was predicated on this understanding of federalism. Indeed, the Tenth Amendment was adopted specifically to ensure that the important role promised the by the proponents of the Constitution was realized. Much of the initial opposition to the Constitution was rooted in the fear that the National Government would be too powerful and eventually would eliminate the as viable political entities. This concern was voiced repeatedly until proponents of the Constitution made assurances that a Bill of including a provision explicitly reserving powers in the would be among the first business of the new Congress. Samuel Adams argued, for example, that if the several were to be joined in "one entire Nation, under one Legislature, the Powers of which shall extend to every Subject of Legislation, and its Laws be supreme & controul the whole, the Idea of Sovereignty in these must be lost." Letter from Samuel Adams to Richard Henry Lee (Dec. 3, 1787), reprinted in Anti- versus *69 19 (J. Lewis ed. 1967). Likewise, George Mason feared that "the general government being paramount to, and in every respect more powerful than the state governments, the latter must give way to the former." Address in the Ratifying Convention of Virginia (June 4-12, 1788), reprinted in Anti- versus Antifederalists raised these concerns in almost every state ratifying convention.[14] See generally 1-4 Debates in the Several State Conventions on the Adoption of the Federal Constitution (J. Elliot 2d. ed. 1876). As a result, eight voted for the Constitution only after proposing amendments to be adopted after ratification.[1] All eight of these included among their recommendations some version of what later became the Tenth Amendment. So strong was the concern that the proposed Constitution was seriously defective without a specific bill of rights, including a provision reserving powers to the that in order to secure the votes for ratification, the eventually conceded that such provisions were necessary. See 1 B. Schwartz, The Bill of : A Documentary History 0 and passim (1971). It was thus generally agreed that consideration of a bill of rights would be among the first business of the new Congress. See generally 1 Annals of Cong. 432-437 (1789) (remarks of James Madison). Accordingly, the 10 Amendments that we know as the Bill of were proposed and adopted early in the first session of the First Congress. 2 Schwartz, The Bill of *70 This history, which the Court simply ignores, documents the integral role of the Tenth Amendment in our constitutional theory. It exposes as well, I believe, the fundamental character of the Court's error today. Far from being "unsound in principle," ante, at 46, judicial enforcement of the Tenth Amendment is essential to maintaining the federal system so carefully designed by the Framers and adopted in the Constitution. B The Framers had definite ideas about the nature of the Constitution's division of authority between the Federal and State Governments. In The Federalist No. 39, for example, Madison explained this division by drawing a series of contrasts between the attributes of a "national" government and those of the government to be established by the Constitution. While a national form of government would possess an "indefinite supremacy over all persons and things," the form of government contemplated by the Constitution instead consisted of "local or municipal authorities [which] form distinct and independent portions of the supremacy, no more subject within their respective spheres to the general authority, than the general authority is subject to them, within its own sphere." Under the Constitution, the sphere of the proposed government extended to jurisdiction of "certain enumerated objects only, leav[ing] to the several a residuary and inviolable sovereignty over all other objects." Madison elaborated on the content of these separate spheres of sovereignty in The Federalist No. 4: "The powers delegated by the proposed Constitution to the Federal Government, are few and defined. Those which are to remain in the State Governments are numerous and indefinite. The former will be exercised principally on external objects, as war, peace, negociation, and foreign commerce The powers *71 reserved to the several will extend to all the objects, which, in the ordinary course of affairs, concern the lives, liberties and properties of the people; and the internal order, improvement, and prosperity of the State." Madison considered that the operations of the Federal Government would be "most extensive and important in times of war and danger; those of the State Governments in times of peace and security." As a result of this division of powers, the state governments generally would be more important than the Federal Government. The Framers believed that the separate sphere of sovereignty reserved to the would ensure that the would serve as an effective "counterpoise" to the power of the Federal Government. The would serve this essential role because they would attract and retain the loyalty of their citizens. The roots of such loyalty, the Founders thought, were found in the objects peculiar to state government. For example, Hamilton argued that the "regulat[e] all those personal interests and familiar concerns to which the sensibility of individuals is more immediately awake" The Federalist No. 17, p. 107 Thus, he maintained that the people would perceive the as "the immediate and visible guardian of life and property," a fact which "contributes more than any other circumstance to impressing upon the minds of the people affection, esteem and reverence towards the government." Madison took the same position, explaining that "the people will be more familiarly and minutely conversant" with the business of state governments, and "with the members of these, will a greater proportion of the people have the ties of personal acquaintance and friendship, and of family and party attachments" The Federalist No. 46, p. 316 Like Hamilton, Madison saw the ' involvement in the everyday concerns of the people as the source of *72 their citizens' loyalty. See also Nagel, Federalism as a Fundamental Value: National League of in Perspective, 1981 S. Ct. Rev. 81. Thus, the harm to the that results from federal overreaching under the Commerce Clause is not simply a matter of dollars and cents. National League of -81. Nor is it a matter of the wisdom or folly of certain policy choices. Cf. ante, at 46. Rather, by usurping functions traditionally performed by the federal overreaching under the Commerce Clause undermines the constitutionally mandated balance of power between the and the Federal Government, a balance designed to protect our fundamental liberties. C The emasculation of the powers of the that can result from the Court's decision is predicated on the Commerce Clause as a power "delegated to the United " by the Constitution. The relevant language states: "Congress shall have power To regulate Commerce with foreign Nations, and among the several and with the Indian Tribes." Art. I, 8, cl. 3. Section 8 identifies a score of powers, listing the authority to lay taxes, borrow money on the credit of the United pay its debts, and provide for the common defense and the general welfare before its brief reference to "Commerce." It is clear from the debates leading up to the adoption of the Constitution that the commerce to be regulated was that which the themselves lacked the practical capability to regulate. See, e. g., 1 M. Farrand, The Records of the Federal Convention of 1787 (rev. ed. 1937); The Federalist Nos. 7, 11, 22, 42, 4. See also Indeed, the language of the Clause itself focuses on activities that only a National Government could regulate: commerce with foreign nations and Indian tribes and "among" the several *73 To be sure, this Court has construed the Commerce Clause to accommodate unanticipated changes over the past two centuries. As these changes have occurred, the Court has had to decide whether the Federal Government has exceeded its authority by regulating activities beyond the capability of a single State to regulate or beyond legitimate federal interests that outweighed the authority and interests of the In so doing, however, the Court properly has been mindful of the essential role of the in our federal system. The opinion for the Court in National League of was faithful to history in its understanding of federalism. The Court observed that "our federal system of government imposes definite limits upon the authority of Congress to regulate the activities of as by means of the commerce power." The Tenth Amendment was invoked to prevent Congress from exercising its " `power in a fashion that impairs the ' integrity or their ability to function effectively in a federal system.' " (quoting n. 7). This Court has recognized repeatedly that state sovereignty is a fundamental component of our system of government. More than a century ago, in Lane the Court stated that the Constitution recognized "the necessary existence of the and, within their proper spheres, the independent authority of the" It concluded, as Madison did, that this authority extended to "nearly the whole charge of interior regulation. ; to [the ] and to the people all powers not expressly delegated to the national government are reserved." Recently, in Community Communications v. Boulder, the Court recognized that the state action exemption from the antitrust laws was based on state Similarly, in Transportation although finding the Railway Labor Act applicable to a state-owned railroad, the *74 unanimous Court was careful to say that the possess constitutionally preserved sovereign powers. Again, in in determining the constitutionality of the Public Utility Regulatory Policies Act, the Court explicitly considered whether the Act impinged on state sovereignty in violation of the Tenth Amendment. These represent only a few of the many cases in which the Court has recognized not only the role, but also the importance, of state See also, e. g., Metcalf & ; As Justice Frankfurter noted, the are not merely a factor in the "shifting economic arrangements" of our country, but also constitute a "coordinate element in the system established by the Framers for governing our Federal Union." National League of D In contrast, the Court today propounds a view of federalism that pays only lipservice to the role of the Although it says that the "unquestionably do `retai[n] a significant measure of sovereign authority,' " ante, at 49 (quoting ), it fails to recognize the broad, yet specific areas of sovereignty that the Framers intended the to retain. Indeed, the Court barely acknowledges that the Tenth Amendment exists.[16] That Amendment states explicitly that "[t]he powers not delegated to the United are reserved to the" The Court recasts this language to say that the retain their sovereign powers "only to the extent that the Constitution has not divested them of their original powers and transferred those powers to the Federal *7 Government." Ante, at 49. This rephrasing is not a distinction without a difference; rather, it reflects the Court's unprecedented view that Congress is free under the Commerce Clause to assume a State's traditional sovereign power, and to do so without judicial review of its action. Indeed, the Court's view of federalism appears to relegate the to precisely the trivial role that opponents of the Constitution feared they would occupy.[17] In National League of we spoke of fire prevention, police protection, sanitation, and public health as "typical of [the services] performed by state and local governments in discharging their dual functions of administering the public law and furnishing public services." Not only are these activities remote from any normal concept of interstate commerce, they are also activities that epitomize the concerns of local, democratic self-government. See n. In emphasizing the need to protect traditional governmental functions, we identified the kinds of activities engaged in by state and local governments that affect the everyday lives of citizens. These are services that people are in a position to understand and evaluate, and in a democracy, have the right to oversee.[18] We recognized that "it is *76 functions such as these which governments are created to provide" and that the and local governments are better able than the National Government to perform The Court maintains that the standard approved in National League of "disserves principles of democratic self-governance." Ante, at 47. In reaching this conclusion, the Court looks myopically only to persons elected to positions in the Federal Government. It disregards entirely the far more effective role of democratic self-government at the state and local levels. One must compare realistically the operation of the state and local governments with that of the Federal Government. Federal legislation is drafted primarily by the staffs of the congressional committees. In view of the hundreds of bills introduced at each session of Congress and the complexity of many of them, it is virtually impossible for even the most conscientious legislators to be truly familiar with many of the statutes enacted. Federal departments and agencies customarily are authorized to write regulations. Often these are more important than the text of the statutes. As is true of the original legislation, these are drafted largely by staff personnel. The administration and enforcement of federal laws and regulations necessarily are largely in the hands of staff and civil service These may have little or no knowledge of the and localities that will be affected by the statutes and regulations for which they are responsible. In any case, they hardly are as accessible and responsive *77 as those who occupy analogous positions in state and local governments. In drawing this contrast, I imply no criticism of these federal or the officials who are ultimately in charge. The great majority are conscientious and faithful to their duties. My point is simply that members of the immense federal bureaucracy are not elected, know less about the services traditionally rendered by and localities, and are inevitably less responsive to recipients of such services, than are state legislatures, city councils, boards of supervisors, and state and local commissions, boards, and agencies. It is at these state and local levels not in Washington as the Court so mistakenly thinks that "democratic self-government" is best exemplified. IV The question presented in these cases is whether the extension of the FLSA to the wages and hours of of a city-owned transit system unconstitutionally impinges on fundamental state The Court's sweeping holding does far more than simply answer this question in the negative. In overruling National League of today's opinion apparently authorizes federal control, under the auspices of the Commerce Clause, over the terms and conditions of employment of all state and local Thus, for purposes of federal regulation, the Court rejects the distinction between public and private employers that had been drawn carefully in National League of The Court's action reflects a serious misunderstanding, if not an outright rejection, of the history of our country and the intention of the Framers of the Constitution.[19] *78 I return now to the balancing test approved in National League of and accepted in Long Island R. and See n. The Court does not find in these cases that the "federal interest is demonstrably greater." No such finding could have been made, for the state interest is compelling. The financial impact on and localities of displacing their control over wages, hours, overtime regulations, pensions, and labor relations with their could have serious, as well as unanticipated, effects on state and local planning, budgeting, and the levying of taxes.[20] As we said in National League of federal control of the terms and conditions of employment of state also inevitably "displaces state policies regarding the manner in which [] will structure delivery of those governmental services that citizens require." The Court emphasizes that municipal operation of an intracity mass transit system is relatively new in the life of our country. It nevertheless is a classic example of the type of service traditionally provided by local government. It is local by definition. It is indistinguishable in principle from the traditional services of providing and maintaining streets, public lighting, traffic control, water, and sewerage systems.[21] Services of this kind are precisely those with which citizens are more "familiarly and minutely conversant." The Federalist No. 46, p. 316 State and local officials of course must be intimately familiar with these services and sensitive to their quality as well as cost. Such *79 officials also know that their constituents and the press respond to the adequacy, fair distribution, and cost of these services. It is this kind of state and local control and accountability that the Framers understood would insure the vitality and preservation of the federal system that the Constitution explicitly requires. See National League of 426 U. S., -82. V Although the Court's opinion purports to recognize that the retain some sovereign power, it does not identify even a single aspect of state authority that would remain when the Commerce Clause is invoked to justify federal regulation. In overruled by National League of and today reaffirmed, the Court sustained an extension of the FLSA to certain hospitals, institutions, and schools. Although the Court's opinion in Wirtz was comparatively narrow, Justice Douglas, in dissent, wrote presciently that the Court's reading of the Commerce Clause would enable "the National Government [to] devour the essentials of state sovereignty, though that sovereignty is attested by the Tenth Amendment." 392 U.S., at 20. Today's decision makes Justice Douglas' fear once again a realistic one. As I view the Court's decision today as rejecting the basic precepts of our federal system and limiting the constitutional role of judicial review, I dissent. |
Justice Rehnquist | dissenting | false | Lawrence County v. Lead-Deadwood School Dist. | 1985-01-09T00:00:00 | null | https://www.courtlistener.com/opinion/111297/lawrence-county-v-lead-deadwood-school-dist/ | https://www.courtlistener.com/api/rest/v3/clusters/111297/ | 1,985 | 1984-018 | 2 | 7 | 2 | In Hunter v. Pittsburgh, 207 U.S. 161 (1907), this Court unanimously described the "settled doctrines of this Court" with respect to States, on the one hand, and counties and other municipal corporations within them, on the other:
"Municipal corporations are political subdivisions of the State, created as convenient agencies for exercising such of the governmental powers of the State as may be entrusted to them. For the purpose of executing these *271 powers properly and efficiently they usually are given the power to acquire, hold, and manage personal and real property. The number, nature and duration of the powers conferred upon these corporations and the territory over which they shall be exercised rests in the absolute discretion of the State." Id., at 178.
Flying in the face of this settled doctrine, the Court today holds that Congress, by providing for payments of federal funds in lieu of taxes to counties in South Dakota, implicitly prohibited the State of South Dakota from regulating in any way the manner in which its counties might spend those funds. Recognizing that the statutory language does not support such a result, the Court seeks to glean from bits and pieces of the testimony of witnesses before congressional Committees, and from selected statements in Committee Reports which do not address the question here at issue, ammunition for the result it reaches. I do not think the Court's opinion succeeds in this rather formidable task.
The statute in question, 31 U.S. C. § 6902(a), provides:
"The Secretary of the Interior shall make a payment for each fiscal year to each unit of general local government in which entitlement land is located. A unit may use the payment for any governmental purpose."
Surely the normal reading of this language would be that appellant Lawrence County is entitled to receive a payment each year from the Secretary of the Interior, and that it may use this payment for any purpose lawful under the system of laws that regulates its activities. The statutes of South Dakota constitute the system of laws regulating Lawrence County. They require in this case that all "in-lieu payments" received by the county, whether from the State or the Federal Government, shall be distributed by the county "in the same manner as taxes are distributed." S. D. Codified Laws § 5-11-6 (1980). In Lawrence County this would mean that appellee Lead-Deadwood School District would *272 receive 60% of the payment. The Court's opinion, however, says the State may not impose such a neutral requirement on the county's disposition of the federal in-lieu payments. The opinion is necessarily premised on the assumption that the words "governmental purpose" in the federal statute somehow emancipate the county from the state regimen as to what is and is not a proper governmental purpose for a county. The Court apparently creates a new federal definition of "governmental purpose," the confines of which are left wholly undeveloped.
The Court relies upon the "administrative construction" of the Act as a primary reason for reaching the result that it does. But the vaunted "administrative construction" simply restates the statutory language in the form of a regulation, 43 CFR § 1881.2 (1983), without any explanatory language. The Court says that "[t]he department has consistently interpreted the statute as foreclosing limitations on the use of in-lieu funds" and cites to a reference in the brief of the United States in this case. Ante, at 261. But the part of the brief cited by the Court refers to a regulation prohibiting school districts from receiving funds directly, and to the above-quoted language simply repeating the words of the statute. Neither of the regulations relied upon supports the Court's bland statement that administrative regulations have foreclosed limitations by the State on the counties' use of in-lieu funds.
Other legislative materials upon which the Court relies are similarly inapt or ambiguous. The conclusion of the House Committee, for example, H. R. Rep. No. 94-1106, p. 12 (1976), that "these new payments should [not] be restricted or earmarked for use for specific purposes" does not by its terms, or fairly interpreted, prohibit States from having any say in the way counties may spend federal in-lieu payments. This statement could just as fairly be interpreted as indicating an intention on the part of Congress not to restrict or earmark such in-lieu funds for a particular purpose.
*273 This two-sentence statutory provision enacted by Congress certainly does not proclaim by its language any single meaning, but one would be hard pressed to derive a more tortured meaning from it than that chosen by the Court. It may be that Congress, by providing that payments be made directly to the counties rather than to the States, implied a desire to have the money spent in the counties. But nothing in the South Dakota statute requires any contrary result; all the South Dakota statute requires is that the counties allocate a part of the money to school districts within the county, just as general tax revenues and state in-lieu payments are allocated. The Court's collection of reasons why Congress intended to prohibit this result is simply not convincing in the light of the long history of treatment of counties as being by law totally subordinate to the States which have created them. I would therefore affirm the judgment of the Supreme Court of South Dakota.
| In this Court unanimously described the "settled doctrines of this Court" with respect to States, on the one hand, and counties and other municipal corporations within them, on the other: "Municipal corporations are political subdivisions of the State, created as convenient agencies for exercising such of the governmental powers of the State as may be entrusted to them. For the purpose of executing these *271 powers properly and efficiently they usually are given the power to acquire, hold, and manage personal and real property. The number, nature and duration of the powers conferred upon these corporations and the territory over which they shall be exercised rests in the absolute discretion of the State." Flying in the face of this settled doctrine, the Court today holds that Congress, by providing for payments of federal funds in lieu of taxes to counties in South Dakota, implicitly prohibited the State of South Dakota from regulating in any way the manner in which its counties might spend those funds. Recognizing that the statutory language does not support such a result, the Court seeks to glean from bits and pieces of the testimony of witnesses before congressional Committees, and from selected statements in Committee Reports which do not address the question here at issue, ammunition for the result it reaches. I do not think the Court's opinion succeeds in this rather formidable task. The statute in question, 31 U.S. C. 6902(a), provides: "The Secretary of the Interior shall make a payment for each fiscal year to each unit of general local government in which entitlement land is located. A unit may use the payment for any governmental purpose." Surely the normal reading of this language would be that appellant Lawrence County is entitled to receive a payment each year from the Secretary of the Interior, and that it may use this payment for any purpose lawful under the system of laws that regulates its activities. The statutes of South Dakota constitute the system of laws regulating Lawrence County. They require in this case that all "in-lieu payments" received by the county, whether from the State or the Federal Government, shall be distributed by the county "in the same manner as taxes are distributed." S. D. Codified Laws 5-11-6 (1980). In Lawrence County this would mean that appellee Lead-Deadwood School District would *272 receive 60% of the payment. The Court's opinion, however, says the State may not impose such a neutral requirement on the county's disposition of the federal in-lieu payments. The opinion is necessarily premised on the assumption that the words "governmental purpose" in the federal statute somehow emancipate the county from the state regimen as to what is and is not a proper governmental purpose for a county. The Court apparently creates a new federal definition of "governmental purpose," the confines of which are left wholly undeveloped. The Court relies upon the "administrative construction" of the Act as a primary reason for reaching the result that it does. But the vaunted "administrative construction" simply restates the statutory language in the form of a regulation, 43 CFR 1881.2 (1983), without any explanatory language. The Court says that "[t]he department has consistently interpreted the statute as foreclosing limitations on the use of in-lieu funds" and cites to a reference in the brief of the United States in this case. Ante, at 261. But the part of the brief cited by the Court refers to a regulation prohibiting school districts from receiving funds directly, and to the above-quoted language simply repeating the words of the statute. Neither of the regulations relied upon supports the Court's bland statement that administrative regulations have foreclosed limitations by the State on the counties' use of in-lieu funds. Other legislative materials upon which the Court relies are similarly inapt or ambiguous. The conclusion of the House Committee, for example, H. R. Rep. No. 94-1106, p. 12 (1976), that "these new payments should [not] be restricted or earmarked for use for specific purposes" does not by its terms, or fairly interpreted, prohibit States from having any say in the way counties may spend federal in-lieu payments. This statement could just as fairly be interpreted as indicating an intention on the part of Congress not to restrict or earmark such in-lieu funds for a particular purpose. *273 This two-sentence statutory provision enacted by Congress certainly does not proclaim by its language any single meaning, but one would be hard pressed to derive a more tortured meaning from it than that chosen by the Court. It may be that Congress, by providing that payments be made directly to the counties rather than to the States, implied a desire to have the money spent in the counties. But nothing in the South Dakota statute requires any contrary result; all the South Dakota statute requires is that the counties allocate a part of the money to school districts within the county, just as general tax revenues and state in-lieu payments are allocated. The Court's collection of reasons why Congress intended to prohibit this result is simply not convincing in the light of the long history of treatment of counties as being by law totally subordinate to the States which have created them. I would therefore affirm the judgment of the Supreme Court of South Dakota. |
Justice Rehnquist | majority | false | Diamond v. Diehr | 1981-03-03T00:00:00 | null | https://www.courtlistener.com/opinion/110422/diamond-v-diehr/ | https://www.courtlistener.com/api/rest/v3/clusters/110422/ | 1,981 | 1980-047 | 1 | 5 | 4 | We granted certiorari to determine whether a process for curing synthetic rubber which includes in several of its steps the use of a mathematical formula and a programmed digital computer is patentable subject matter under 35 U.S. C. § 101.
I
The patent application at issue was filed by the respondents on August 6, 1975. The claimed invention is a process for molding raw, uncured synthetic rubber into cured precision products. The process uses a mold for precisely shaping the uncured material under heat and pressure and then curing the synthetic rubber in the mold so that the product will retain its shape and be functionally operative after the molding is completed.[1]
Respondents claim that their process ensures the production of molded articles which are properly cured. Achieving the perfect cure depends upon several factors including the thickness of the article to be molded, the temperature of the molding process, and the amount of time that the article is allowed to remain in the press. It is possible using well-known time, temperature, and cure relationships to calculate by means of the Arrhenius equation[2] when to open the press *178 and remove the cured product. Nonetheless, according to the respondents, the industry has not been able to obtain uniformly accurate cures because the temperature of the molding press could not be precisely measured, thus making it difficult to do the necessary computations to determine cure time.[3] Because the temperature inside the press has heretofore been viewed as an uncontrollable variable, the conventional industry practice has been to calculate the cure time as the shortest time in which all parts of the product will definitely be cured, assuming a reasonable amount of mold-opening time during loading and unloading. But the shortcoming of this practice is that operating with an uncontrollable variable inevitably led in some instances to overestimating the mold-opening time and overcuring the rubber, and in other instances to underestimating that time and undercuring the product.[4]
Respondents characterize their contribution to the art to reside in the process of constantly measuring the actual temperature inside the mold. These temperature measurements are then automatically fed into a computer which repeatedly recalculates the cure time by use of the Arrhenius equation. *179 When the recalculated time equals the actual time that has elapsed since the press was closed, the computer signals a device to open the press. According to the respondents, the continuous measuring of the temperature inside the mold cavity, the feeding of this information to a digital computer which constantly recalculates the cure time, and the signaling by the computer to open the press, are all new in the art.
The patent examiner rejected the respondents' claims on the sole ground that they were drawn to nonstatutory subject matter under 35 U.S. C. § 101.[5] He determined that those *180 steps in respondents' claims that are carried out by a computer under control of a stored program constituted nonstatutory subject matter under this Court's decision in Gottschalk v. Benson, 409 U.S. 63 (1972). The remaining stepsinstalling rubber in the press and the subsequent closing of the *181 presswere "conventional and necessary to the process and cannot be the basis of patentability." The examiner concluded that respondents' claims defined and sought protection of a computer program for operating a rubber-molding press.
The Patent and Trademark Office Board of Appeals agreed with the examiner, but the Court of Customs and Patent Appeals reversed. In re Diehr, 602 F.2d 892 (1979). The court noted that a claim drawn to subject matter otherwise statutory does not become nonstatutory because a computer is involved. The respondents' claims were not directed to a mathematical algorithm or an improved method of calculation but rather recited an improved process for molding rubber articles by solving a practical problem which had arisen in the molding of rubber products.
The Commissioner of Patents and Trademarks sought certiorari arguing that the decision of the Court of Customs and Patent Appeals was inconsistent with prior decisions of this Court. Because of the importance of the question presented, we granted the writ. 445 U.S. 926 (1980).
II
Last Term in Diamond v. Chakrabarty, 447 U.S. 303 (1980), this Court discussed the historical purposes of the patent laws and in particular 35 U.S. C. § 101. As in Chakrabarty, we must here construe 35 U.S. C. § 101 which provides:
"Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title."[6]
*182 In cases of statutory construction, we begin with the language of the statute. Unless otherwise defined, "words will be interpreted as taking their ordinary, contemporary, common meaning," Perrin v. United States, 444 U.S. 37, 42 (1979), and, in dealing with the patent laws, we have more than once cautioned that "courts `should not read into the patent laws limitations and conditions which the legislature has not expressed.'" Diamond v. Chakrabarty, supra, at 308, quoting United States v. Dubilier Condenser Corp., 289 U.S. 178, 199 (1933).
The Patent Act of 1793 defined statutory subject matter as "any new and useful art, machine, manufacture or composition of matter, or any new or useful improvement [thereof]." Act of Feb. 21, 1793, ch. 11, § 1, 1 Stat. 318. Not until the patent laws were recodified in 1952 did Congress replace the word "art" with the word "process." It is that latter word which we confront today, and in order to determine its meaning we may not be unmindful of the Committee Reports accompanying the 1952 Act which inform us that Congress intended statutory subject matter to "include anything under the sun that is made by man." S. Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952); H. R. Rep. No. 1923, 82d Cong., 2d Sess., 6 (1952).
Although the term "process" was not added to 35 U.S. C. § 101 until 1952, a process has historically enjoyed patent protection because it was considered a form of "art" as that term was used in the 1793 Act.[7] In defining the nature of a patentable process, the Court stated:
"That a process may be patentable, irrespective of the *183 particular form of the instrumentalities used, cannot be disputed. . . . A process is a mode of treatment of certain materials to produce a given result. It is an act, or a series of acts, performed upon the subject-matter to be transformed and reduced to a different state or thing. If new and useful, it is just as patentable as is a piece of machinery. In the language of the patent law, it is an art. The machinery pointed out as suitable to perform the process may or may not be new or patentable; whilst the process itself may be altogether new, and produce an entirely new result. The process requires *184 that certain things should be done with certain substances, and in a certain order; but the tools to be used in doing this may be of secondary consequence." Cochrane v. Deener, 94 U.S. 780, 787-788 (1877).
Analysis of the eligibility of a claim of patent protection for a "process" did not change with the addition of that term to § 101. Recently, in Gottschalk v. Benson, 409 U.S. 63 (1972), we repeated the above definition recited in Cochrane v. Deener, adding: "Transformation and reduction of an article `to a different state or thing' is the clue to the patentability of a process claim that does not include particular machines." 409 U.S., at 70.
Analyzing respondents' claims according to the above statements from our cases, we think that a physical and chemical process for molding precision synthetic rubber products falls within the § 101 categories of possibly patentable subject matter. That respondents' claims involve the transformation of an article, in this case raw, uncured synthetic rubber, into a different state or thing cannot be disputed. The respondents' claims describe in detail a step-by-step method for accomplishing such, beginning with the loading of a mold with raw, uncured rubber and ending with the eventual opening of the press at the conclusion of the cure. Industrial processes such as this are the types which have historically been eligible to receive the protection of our patent laws.[8]
*185 III
Our conclusion regarding respondents' claims is not altered by the fact that in several steps of the process a mathematical equation and a programmed digital computer are used. This Court has undoubtedly recognized limits to § 101 and every discovery is not embraced within the statutory terms. Excluded from such patent protection are laws of nature, natural phenomena, and abstract ideas. See Parker v. Flook, 437 U.S. 584 (1978); Gottschalk v. Benson, supra, at 67; Funk Bros. Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130 (1948). "An idea of itself is not patentable," Rubber-Tip Pencil Co. v. Howard, 20 Wall. 498, 507 (1874). "A principle, in the abstract, is a fundamental truth; an original cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive right." Le Roy v. Tatham, 14 How. 156, 175 (1853). Only last Term, we explained:
"[A] new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law that E=mc[2]; nor could Newton have patented the law of gravity. Such discoveries are `manifestations of . . . nature, free to all men and reserved exclusively to none.'" Diamond v. Chakrabarty, 447 U. S., at 309, quoting Funk Bros. Seed Co. v. Kalo Inoculant Co., supra, at 130.
Our recent holdings in Gottschalk v. Benson, supra, and Parker v. Flook, supra, both of which are computer-related, stand for no more than these long-established principles. In Benson, we held unpatentable claims for an algorithm used to convert binary code decimal numbers to equivalent pure binary numbers. The sole practical application of the algorithm was in connection with the programming of a *186 general purpose digital computer. We defined "algorithm" as a "procedure for solving a given type of mathematical problem," and we concluded that such an algorithm, or mathematical formula, is like a law of nature, which cannot be the subject of a patent.[9]
Parker v. Flook, supra, presented a similar situation. The claims were drawn to a method for computing an "alarm limit." An "alarm limit" is simply a number and the Court concluded that the application sought to protect a formula for computing this number. Using this formula, the updated alarm limit could be calculated if several other variables were known. The application, however, did not purport to explain how these other variables were to be determined,[10] nor *187 did it purport "to contain any disclosure relating to the chemical processes at work, the monitoring of process variables, or the means of setting off an alarm or adjusting an alarm system. All that it provides is a formula for computing an updated alarm limit." 437 U.S., at 586.
In contrast, the respondents here do not seek to patent a mathematical formula. Instead, they seek patent protection for a process of curing synthetic rubber. Their process admittedly employs a well-known mathematical equation, but they do not seek to pre-empt the use of that equation. Rather, they seek only to foreclose from others the use of that equation in conjunction with all of the other steps in their claimed process. These include installing rubber in a press, closing the mold, constantly determining the temperature of the mold, constantly recalculating the appropriate cure time through the use of the formula and a digital computer, and automatically opening the press at the proper time. Obviously, one does not need a "computer" to cure natural or synthetic rubber, but if the computer use incorporated in the process patent significantly lessens the possibility of "overcuring" or "undercuring," the process as a whole does not thereby become unpatentable subject matter.
Our earlier opinions lend support to our present conclusion that a claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula, computer program, or digital computer. In Gottschalk v. Benson we noted: "It is said that the decision precludes a patent for any program servicing a computer. We do not so hold." 409 U.S., at 71. Similarly, in Parker v. Flook we stated that "a process is not unpatentable simply because it contains a law of nature or a mathematical algorithm." 437 U.S., at 590. It is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection. See, e. g., Funk Bros. Seed *188 Co. v. Kalo Inoculant Co., 333 U.S. 127 (1948); Eibel Process Co. v. Minnesota & Ontario Paper Co., 261 U.S. 45 (1923); Cochrane v. Deener, 94 U.S. 780 (1877); O'Reilly v. Morse, 15 How. 62 (1854); and Le Roy v. Tatham, 14 How. 156 (1853). As Justice Stone explained four decades ago:
"While a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid of knowledge of scientific truth may be." Mackay Radio & Telegraph Co. v. Radio Corp. of America, 306 U.S. 86, 94 (1939).[11]
We think this statement in Mackay takes us a long way toward the correct answer in this case. Arrhenius' equation is not patentable in isolation, but when a process for curing rubber is devised which incorporates in it a more efficient solution of the equation, that process is at the very least not barred at the threshold by § 101.
In determining the eligibility of respondents' claimed process for patent protection under § 101, their claims must be considered as a whole. It is inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the analysis. This is particularly true in a process claim because a new combination of steps in a process may be patentable even though all the constituents of the combination were well known and in common use before the combination was made. The "novelty" of any element or steps in a process, or even of the *189 process itself, is of no relevance in determining whether the subject matter of a claim falls within the § 101 categories of possibly patentable subject matter.[12]
It has been urged that novelty is an appropriate consideration under § 101. Presumably, this argument results from the language in § 101 referring to any "new and useful" process, machine, etc. Section 101, however, is a general statement of the type of subject matter that is eligible for patent protection "subject to the conditions and requirements of this title." Specific conditions for patentability follow and § 102 covers in detail the conditions relating to novelty.[13]*190 The question therefore of whether a particular invention is novel is "wholly apart from whether the invention falls into a category of statutory subject matter." In re Bergy, 596 F.2d 952, 961 (CCPA 1979) (emphasis deleted). See also Nickola v. Peterson, 580 F.2d 898 (CA6 1978). The legislative history of the 1952 Patent Act is in accord with this reasoning. The Senate Report stated:
"Section 101 sets forth the subject matter that can be patented, `subject to the conditions and requirements of this title.' The conditions under which a patent may be obtained follow, and Section 102 covers the conditions relating to novelty." S. Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952) (emphasis supplied).
It is later stated in the same Report:
"Section 102, in general, may be said to describe the statutory novelty required for patentability, and includes, *191 in effect, an amplification and definition of `new' in section 101." Id., at 6.
Finally, it is stated in the "Revision Notes":
"The corresponding section of [the] existing statute is split into two sections, section 101 relating to the subject matter for which patents may be obtained, and section 102 defining statutory novelty and stating other conditions for patentability." Id., at 17.
See also H. R. Rep. No. 1923, 82d Cong., 2d Sess., 6, 7, and 17 (1952).
In this case, it may later be determined that the respondents' process is not deserving of patent protection because it fails to satisfy the statutory conditions of novelty under § 102 or nonobviousness under § 103. A rejection on either of these grounds does not affect the determination that respondents' claims recited subject matter which was eligible for patent protection under § 101.
IV
We have before us today only the question of whether respondents' claims fall within the § 101 categories of possibly patentable subject matter. We view respondents' claims as nothing more than a process for molding rubber products and not as an attempt to patent a mathematical formula. We recognize, of course, that when a claim recites a mathematical formula (or scientific principle or phenomenon of nature), an inquiry must be made into whether the claim is seeking patent protection for that formula in the abstract. A mathematical formula as such is not accorded the protection of our patent laws, Gottschalk v. Benson, 409 U.S. 63 (1972), and this principle cannot be circumvented by attempting to limit the use of the formula to a particular technological environment. Parker v. Flook, 437 U.S. 584 (1978). Similarly, insignificant postsolution activity will not transform *192 an unpatentable principle into a patentable process. Ibid.[14] To hold otherwise would allow a competent draftsman to evade the recognized limitations on the type of subject matter eligible for patent protection. On the other hand, when a claim containing a mathematical formula implements or applies that formula in a structure or process which, when considered as a whole, is performing a function which the patent laws were designed to protect (e. g., transforming or reducing an article to a different state or thing), then the claim satisfies the requirements of § 101. Because we do not view respondents' claims as an attempt to patent a mathematical formula, but rather to be drawn to an industrial process *193 for the molding of rubber products, we affirm the judgment of the Court of Customs and Patent Appeals.[15]
It is so ordered. | We granted certiorari to determine whether a process for curing synthetic rubber which includes in several of its steps the use of a mathematical formula and a programmed digital computer is patentable subject matter under 35 U.S. C. 101. I The patent application at issue was filed by the respondents on August 6, 1975. The claimed invention is a process for molding raw, uncured synthetic rubber into cured precision products. The process uses a mold for precisely shaping the uncured material under heat and pressure and then curing the synthetic rubber in the mold so that the product will retain its shape and be functionally operative after the molding is completed.[1] Respondents claim that their process ensures the production of molded articles which are properly cured. Achieving the perfect cure depends upon several factors including the thickness of the article to be molded, the temperature of the molding process, and the amount of time that the article is allowed to remain in the press. It is possible using well-known time, temperature, and cure relationships to calculate by means of the Arrhenius equation[2] when to open the press *178 and remove the cured product. Nonetheless, according to the respondents, the industry has not been able to obtain uniformly accurate cures because the temperature of the molding press could not be precisely measured, thus making it difficult to do the necessary computations to determine cure time.[3] Because the temperature inside the press has heretofore been viewed as an uncontrollable variable, the conventional industry practice has been to calculate the cure time as the shortest time in which all parts of the product will definitely be cured, assuming a reasonable amount of mold-opening time during loading and unloading. But the shortcoming of this practice is that operating with an uncontrollable variable inevitably led in some instances to overestimating the mold-opening time and overcuring the rubber, and in other instances to underestimating that time and undercuring the product.[4] Respondents characterize their contribution to the art to reside in the process of constantly measuring the actual temperature inside the mold. These temperature measurements are then automatically fed into a computer which repeatedly recalculates the cure time by use of the Arrhenius equation. *179 When the recalculated time equals the actual time that has elapsed since the press was closed, the computer signals a device to open the press. According to the respondents, the continuous measuring of the temperature inside the mold cavity, the feeding of this information to a digital computer which constantly recalculates the cure time, and the signaling by the computer to open the press, are all new in the art. The patent examiner rejected the respondents' claims on the sole ground that they were drawn to nonstatutory subject matter under 35 U.S. C. 101.[5] He determined that those *180 steps in respondents' claims that are carried out by a computer under control of a stored program constituted nonstatutory subject matter under this Court's decision in The remaining stepsinstalling rubber in the press and the subsequent closing of the *181 presswere "conventional and necessary to the process and cannot be the basis of patentability." The examiner concluded that respondents' claims defined and sought protection of a computer program for operating a rubber-molding press. The Patent and Trademark Office Board of Appeals agreed with the examiner, but the Court of Customs and Patent Appeals reversed. In re Diehr, The court noted that a claim drawn to subject matter otherwise statutory does not become nonstatutory because a computer is involved. The respondents' claims were not directed to a mathematical algorithm or an improved method of calculation but rather recited an improved process for molding rubber articles by solving a practical problem which had arisen in the molding of rubber products. The Commissioner of Patents and Trademarks sought certiorari arguing that the decision of the Court of Customs and Patent Appeals was inconsistent with prior decisions of this Court. Because of the importance of the question presented, we granted the writ. II Last Term in this Court discussed the historical purposes of the patent laws and in particular 35 U.S. C. 101. As in we must here construe 35 U.S. C. 101 which provides: "Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title."[6] *182 In cases of statutory construction, we begin with the language of the statute. Unless otherwise defined, "words will be interpreted as taking their ordinary, contemporary, common meaning," and, in dealing with the patent laws, we have more than once cautioned that "courts `should not read into the patent laws limitations and conditions which the legislature has not expressed.'" quoting United The Patent Act of 1793 defined statutory subject matter as "any new and useful art, machine, manufacture or composition of matter, or any new or useful improvement [thereof]." Act of Feb. 21, 1793, ch. 11, 1, Not until the patent laws were recodified in 1952 did Congress replace the word "art" with the word "process." It is that latter word which we confront today, and in order to determine its meaning we may not be unmindful of the Committee Reports accompanying the 1952 Act which inform us that Congress intended statutory subject matter to "include anything under the sun that is made by man." S. Rep. No. 82d Cong., 2d Sess., 5 (1952); H. R. Rep. No. 1923, 82d Cong., 2d Sess., 6 (1952). Although the term "process" was not added to 35 U.S. C. 101 until 1952, a process has historically enjoyed patent protection because it was considered a form of "art" as that term was used in the 1793 Act.[7] In defining the nature of a patentable process, the Court stated: "That a process may be patentable, irrespective of the *183 particular form of the instrumentalities used, cannot be disputed. A process is a mode of treatment of certain materials to produce a given result. It is an act, or a series of acts, performed upon the subject-matter to be transformed and reduced to a different state or thing. If new and useful, it is just as patentable as is a piece of machinery. In the language of the patent law, it is an art. The machinery pointed out as suitable to perform the process may or may not be new or patentable; whilst the process itself may be altogether new, and produce an entirely new result. The process requires *184 that certain things should be done with certain substances, and in a certain order; but the tools to be used in doing this may be of secondary consequence." Analysis of the eligibility of a claim of patent protection for a "process" did not change with the addition of that term to 101. Recently, in we repeated the above definition recited in adding: "Transformation and reduction of an article `to a different state or thing' is the clue to the patentability of a process claim that does not include particular machines." Analyzing respondents' claims according to the above statements from our cases, we think that a physical and chemical process for molding precision synthetic rubber products falls within the 101 categories of possibly patentable subject matter. That respondents' claims involve the transformation of an article, in this case raw, uncured synthetic rubber, into a different state or thing cannot be disputed. The respondents' claims describe in detail a step-by-step method for accomplishing such, beginning with the loading of a mold with raw, uncured rubber and ending with the eventual opening of the press at the conclusion of the cure. Industrial processes such as this are the types which have historically been eligible to receive the protection of our patent laws.[8] *185 III Our conclusion regarding respondents' claims is not altered by the fact that in several steps of the process a mathematical equation and a programmed digital computer are used. This Court has undoubtedly recognized limits to 101 and every discovery is not embraced within the statutory terms. Excluded from such patent protection are laws of nature, natural phenomena, and abstract ideas. See ; ; Funk Bros. Seed "An idea of itself is not patentable," Rubber-Tip Pencil "A principle, in the abstract, is a fundamental truth; an original cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive right." Le Only last Term, we explained: "[A] new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law that E=mc[2]; nor could Newton have patented the law of gravity. Such discoveries are `manifestations of nature, free to all men and reserved exclusively to none.'" quoting Funk Bros. Seed at Our recent holdings in and both of which are computer-related, stand for no more than these long-established principles. In we held unpatentable claims for an algorithm used to convert binary code decimal numbers to equivalent pure binary numbers. The sole practical application of the algorithm was in connection with the programming of a *186 general purpose digital computer. We defined "algorithm" as a "procedure for solving a given type of mathematical problem," and we concluded that such an algorithm, or mathematical formula, is like a law of nature, which cannot be the subject of a patent.[9] presented a similar situation. The claims were drawn to a method for computing an "alarm limit." An "alarm limit" is simply a number and the Court concluded that the application sought to protect a formula for computing this number. Using this formula, the updated alarm limit could be calculated if several other variables were known. The application, however, did not purport to explain how these other variables were to be determined,[10] nor *187 did it purport "to contain any disclosure relating to the chemical processes at work, the monitoring of process variables, or the means of setting off an alarm or adjusting an alarm system. All that it provides is a formula for computing an updated alarm limit." In contrast, the respondents here do not seek to patent a mathematical formula. Instead, they seek patent protection for a process of curing synthetic rubber. Their process admittedly employs a well-known mathematical equation, but they do not seek to pre-empt the use of that equation. Rather, they seek only to foreclose from others the use of that equation in conjunction with all of the other steps in their claimed process. These include installing rubber in a press, closing the mold, constantly determining the temperature of the mold, constantly recalculating the appropriate cure time through the use of the formula and a digital computer, and automatically opening the press at the proper time. Obviously, one does not need a "computer" to cure natural or synthetic rubber, but if the computer use incorporated in the process patent significantly lessens the possibility of "overcuring" or "undercuring," the process as a whole does not thereby become unpatentable subject matter. Our earlier opinions lend support to our present conclusion that a claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula, computer program, or digital computer. In we noted: "It is said that the decision precludes a patent for any program servicing a computer. We do not so hold." Similarly, in we stated that "a process is not unpatentable simply because it contains a law of nature or a mathematical algorithm." It is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection. See, e. g., Funk Bros. Seed *188 ; Eibel Process v. Minnesota & Ontario Paper ; ; ; and Le As Justice Stone explained four decades ago: "While a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid of knowledge of scientific truth may be." Mackay Radio & Telegraph v. Radio Corp. of America,[11] We think this statement in Mackay takes us a long way toward the correct answer in this case. Arrhenius' equation is not patentable in isolation, but when a process for curing rubber is devised which incorporates in it a more efficient solution of the equation, that process is at the very least not barred at the threshold by 101. In determining the eligibility of respondents' claimed process for patent protection under 101, their claims must be considered as a whole. It is inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the analysis. This is particularly true in a process claim because a new combination of steps in a process may be patentable even though all the constituents of the combination were well known and in common use before the combination was made. The "novelty" of any element or steps in a process, or even of the *189 process itself, is of no relevance in determining whether the subject matter of a claim falls within the 101 categories of possibly patentable subject matter.[12] It has been urged that novelty is an appropriate consideration under 101. Presumably, this argument results from the language in 101 referring to any "new and useful" process, machine, etc. Section 101, however, is a general statement of the type of subject matter that is eligible for patent protection "subject to the conditions and requirements of this title." Specific conditions for patentability follow and 102 covers in detail the conditions relating to novelty.[13]*190 The question therefore of whether a particular invention is novel is "wholly apart from whether the invention falls into a category of statutory subject matter." In re Bergy, See also The legislative history of the 1952 Patent Act is in accord with this reasoning. The Senate Report stated: "Section 101 sets forth the subject matter that can be patented, `subject to the conditions and requirements of this title.' The conditions under which a patent may be obtained follow, and Section 102 covers the conditions relating to novelty." S. Rep. No. 82d Cong., 2d Sess., 5 (1952) (emphasis supplied). It is later stated in the same Report: "Section 102, in general, may be said to describe the statutory novelty required for patentability, and includes, *191 in effect, an amplification and definition of `new' in section 101." Finally, it is stated in the "Revision Notes": "The corresponding section of [the] existing statute is split into two sections, section 101 relating to the subject matter for which patents may be obtained, and section 102 defining statutory novelty and stating other conditions for patentability." See also H. R. Rep. No. 1923, 82d Cong., 2d Sess., 6, 7, and 17 (1952). In this case, it may later be determined that the respondents' process is not deserving of patent protection because it fails to satisfy the statutory conditions of novelty under 102 or nonobviousness under 103. A rejection on either of these grounds does not affect the determination that respondents' claims recited subject matter which was eligible for patent protection under 101. IV We have before us today only the question of whether respondents' claims fall within the 101 categories of possibly patentable subject matter. We view respondents' claims as nothing more than a process for molding rubber products and not as an attempt to patent a mathematical formula. We recognize, of course, that when a claim recites a mathematical formula (or scientific principle or phenomenon of nature), an inquiry must be made into whether the claim is seeking patent protection for that formula in the abstract. A mathematical formula as such is not accorded the protection of our patent laws, and this principle cannot be circumvented by attempting to limit the use of the formula to a particular technological environment. Similarly, insignificant postsolution activity will not transform *192 an unpatentable principle into a patentable process. Ibid.[14] To hold otherwise would allow a competent draftsman to evade the recognized limitations on the type of subject matter eligible for patent protection. On the other hand, when a claim containing a mathematical formula implements or applies that formula in a structure or process which, when considered as a whole, is performing a function which the patent laws were designed to protect (e. g., transforming or reducing an article to a different state or thing), then the claim satisfies the requirements of 101. Because we do not view respondents' claims as an attempt to patent a mathematical formula, but rather to be drawn to an industrial process *193 for the molding of rubber products, we affirm the judgment of the Court of Customs and Patent Appeals.[15] It is so ordered. |
Justice Thomas | majority | false | Ohio v. American Express Co. | 2018-06-25T00:00:00 | null | https://www.courtlistener.com/opinion/4510626/ohio-v-american-express-co/ | https://www.courtlistener.com/api/rest/v3/clusters/4510626/ | 2,018 | 2017-044 | 1 | 5 | 4 | American Express Company and American Express
Travel Related Services Company (collectively, Amex)
provide credit-card services to both merchants and card-
holders. When a cardholder buys something from a mer-
chant who accepts Amex credit cards, Amex processes the
transaction through its network, promptly pays the mer-
chant, and subtracts a fee. If a merchant wants to accept
Amex credit cards—and attract Amex cardholders to its
business—Amex requires the merchant to agree to an
antisteering contractual provision. The antisteering pro-
vision prohibits merchants from discouraging customers
from using their Amex card after they have already en-
tered the store and are about to buy something, thereby
avoiding Amex’s fee. In this case, we must decide whether
Amex’s antisteering provisions violate federal antitrust
law. We conclude they do not.
I
A
Credit cards have become a primary way that consum-
ers in the United States purchase goods and services.
2 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
When a cardholder uses a credit card to buy something
from a merchant, the transaction is facilitated by a credit-
card network. The network provides separate but inter-
related services to both cardholders and merchants. For
cardholders, the network extends them credit, which
allows them to make purchases without cash and to defer
payment until later. Cardholders also can receive rewards
based on the amount of money they spend, such as airline
miles, points for travel, or cash back. For merchants, the
network allows them to avoid the cost of processing trans-
actions and offers them quick, guaranteed payment. This
saves merchants the trouble and risk of extending credit
to customers, and it increases the number and value of
sales that they can make.
By providing these services to cardholders and mer-
chants, credit-card companies bring these parties together,
and therefore operate what economists call a “two-sided
platform.” As the name implies, a two-sided platform
offers different products or services to two different groups
who both depend on the platform to intermediate between
them. See Evans & Schmalensee, Markets With Two-
Sided Platforms, 1 Issues in Competition L. & Pol’y 667
(2008) (Evans & Schmalensee); Evans & Noel, Defining
Antitrust Markets When Firms Operate Two-Sided Plat-
forms, 2005 Colum. Bus. L. Rev. 667, 668 (Evans & Noel);
Filistrucchi, Geradin, Van Damme, & Affeldt, Market
Definition in Two-Sided Markets: Theory and Practice, 10
J. Competition L. & Econ. 293, 296 (2014) (Filistrucchi).
For credit cards, that interaction is a transaction. Thus,
credit-card networks are a special type of two-sided plat-
form known as a “transaction” platform. See id., at 301,
304, 307; Evans & Noel 676–678. The key feature of
transaction platforms is that they cannot make a sale to
one side of the platform without simultaneously making a
sale to the other. See Klein, Lerner, Murphy, & Plache,
Competition in Two-Sided Markets: The Antitrust Eco-
Cite as: 585 U. S. ____ (2018) 3
Opinion of the Court
nomics of Payment Card Interchange Fees, 73 Antitrust
L. J. 571, 580, 583 (2006) (Klein). For example, no credit-
card transaction can occur unless both the merchant and
the cardholder simultaneously agree to use the same
credit-card network. See Filistrucchi 301.
Two-sided platforms differ from traditional markets in
important ways. Most relevant here, two-sided platforms
often exhibit what economists call “indirect network ef-
fects.” Evans & Schmalensee 667. Indirect network ef-
fects exist where the value of the two-sided platform to one
group of participants depends on how many members of a
different group participate. D. Evans & R. Schmalensee,
Matchmakers: The New Economics of Multisided Plat-
forms 25 (2016). In other words, the value of the services
that a two-sided platform provides increases as the num-
ber of participants on both sides of the platform increases.
A credit card, for example, is more valuable to cardholders
when more merchants accept it, and is more valuable to
merchants when more cardholders use it. See Evans &
Noel 686–687; Klein 580, 584. To ensure sufficient partic-
ipation, two-sided platforms must be sensitive to the
prices that they charge each side. See Evans & Schma-
lensee 675; Evans & Noel 680; Muris, Payment Card
Regulation and the (Mis)Application of the Economics of
Two-Sided Markets, 2005 Colum. Bus. L. Rev. 515, 532–
533 (Muris); Rochet & Tirole, Platform Competition in
Two-Sided Markets, 1 J. Eur. Econ. Assn. 990, 1013
(2003). Raising the price on side A risks losing participa-
tion on that side, which decreases the value of the plat-
form to side B. If participants on side B leave due to this
loss in value, then the platform has even less value to side
A—risking a feedback loop of declining demand. See
Evans & Schmalensee 675; Evans & Noel 680–681. Two-
sided platforms therefore must take these indirect net-
work effects into account before making a change in price
on either side. See Evans & Schmalensee 675; Evans &
4 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
Noel 680–681.1
Sometimes indirect network effects require two-sided
platforms to charge one side much more than the other.
See Evans & Schmalensee 667, 675, 681, 690–691; Evans
& Noel 668, 691; Klein 585; Filistrucchi 300. For two-
sided platforms, “ ‘the [relative] price structure matters,
and platforms must design it so as to bring both sides on
board.’ ” Evans & Schmalensee 669 (quoting Rochet &
Tirole, Two-Sided Markets: A Progress Report, 37 RAND
J. Econ. 645, 646 (2006)). The optimal price might require
charging the side with more elastic demand a below-cost
(or even negative) price. See Muris 519, 550; Klein 579;
Evans & Schmalensee 675; Evans & Noel 681. With credit
cards, for example, networks often charge cardholders a
lower fee than merchants because cardholders are more
price sensitive.2 See Muris 522; Klein 573–574, 585, 595.
In fact, the network might well lose money on the card-
holder side by offering rewards such as cash back, airline
miles, or gift cards. See Klein 587; Evans & Schmalensee
672. The network can do this because increasing the
number of cardholders increases the value of accepting the
card to merchants and, thus, increases the number of
——————
1 Ina competitive market, indirect network effects also encourage
companies to take increased profits from a price increase on side A and
spend them on side B to ensure more robust participation on that side
and to stem the impact of indirect network effects. See Evans &
Schmalensee 688; Evans & Noel 670–671, 695. Indirect network effects
thus limit the platform’s ability to raise overall prices and impose a
check on its market power. See Evans & Schmalensee 688; Evans &
Noel 695.
2 “Cardholders are more price-sensitive because many consumers
have multiple payment methods, including alternative payment cards.
Most merchants, by contrast, cannot accept just one major card because
they are likely to lose profitable incremental sales if they do not take
[all] the major payment cards. Because most consumers do not carry
all of the major payment cards, refusing to accept a major card may
cost the merchant substantial sales.” Muris 522.
Cite as: 585 U. S. ____ (2018) 5
Opinion of the Court
merchants who accept it. Muris 522; Evans & Schma-
lensee 692. Networks can then charge those merchants a
fee for every transaction (typically a percentage of the
purchase price). Striking the optimal balance of the prices
charged on each side of the platform is essential for two-
sided platforms to maximize the value of their services
and to compete with their rivals.
B
Amex, Visa, MasterCard, and Discover are the four
dominant participants in the credit-card market. Visa,
which is by far the largest, has 45% of the market as
measured by transaction volume.3 Amex and MasterCard
trail with 26.4% and 23.3%, respectively, while Discover
has just 5.3% of the market.
Visa and MasterCard have significant structural ad-
vantages over Amex. Visa and MasterCard began as bank
cooperatives and thus almost every bank that offers credit
cards is in the Visa or MasterCard network. This makes it
very likely that the average consumer carries, and the
average merchant accepts, Visa or MasterCard. As a
result, the vast majority of Amex cardholders have a Visa
or MasterCard, but only a small number of Visa and Master-
Card cardholders have an Amex. Indeed, Visa and
MasterCard account for more than 432 million cards in
circulation in the United States, while Amex has only 53
million. And while 3.4 million merchants at 6.4 million
locations accept Amex, nearly three million more locations
accept Visa, MasterCard, and Discover.4
——————
3 Allfigures are accurate as of 2013.
4 Discover entered the credit-card market several years after Amex,
Visa, and MasterCard. It nonetheless managed to gain a foothold
because Sears marketed Discover to its already significant base of
private-label cardholders. Discover’s business model shares certain
features with Amex, Visa, and MasterCard. Like Amex, Discover
interacts directly with its cardholders. But like Visa and MasterCard,
6 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
Amex competes with Visa and MasterCard by using a
different business model. While Visa and MasterCard
earn half of their revenue by collecting interest from their
cardholders, Amex does not. Amex instead earns most of
its revenue from merchant fees. Amex’s business model
thus focuses on cardholder spending rather than card-
holder lending. To encourage cardholder spending, Amex
provides better rewards than other networks. Due to its
superior rewards, Amex tends to attract cardholders who
are wealthier and spend more money. Merchants place a
higher value on these cardholders, and Amex uses this
advantage to recruit merchants.
Amex’s business model has significantly influenced the
credit-card market. To compete for the valuable cardhold-
ers that Amex attracts, both Visa and MasterCard have
introduced premium cards that, like Amex, charge mer-
chants higher fees and offer cardholders better rewards.
To maintain their lower merchant fees, Visa and Master-
Card have created a sliding scale for their various cards—
charging merchants less for low-reward cards and more
for high-reward cards. This differs from Amex’s strategy,
which is to charge merchants the same fee no matter the
rewards that its card offers. Another way that Amex has
influenced the credit-card market is by making banking
and card-payment services available to low-income indi-
viduals, who otherwise could not qualify for a credit card
and could not afford the fees that traditional banks
charge. See 2 Record 3835–3837, 4527–4529. In sum,
Amex’s business model has stimulated competitive inno-
vations in the credit-card market, increasing the volume of
transactions and improving the quality of the services.
Despite these improvements, Amex’s business model
sometimes causes friction with merchants. To maintain
——————
Discover uses banks that cooperate with its network to interact with
merchants.
Cite as: 585 U. S. ____ (2018) 7
Opinion of the Court
the loyalty of its cardholders, Amex must continually
invest in its rewards program. But, to fund those invest-
ments, Amex must charge merchants higher fees than its
rivals. Even though Amex’s investments benefit mer-
chants by encouraging cardholders to spend more money,
merchants would prefer not to pay the higher fees. One
way that merchants try to avoid them, while still enticing
Amex’s cardholders to shop at their stores, is by dissuad-
ing cardholders from using Amex at the point of sale. This
practice is known as “steering.”
Amex has prohibited steering since the 1950s by placing
antisteering provisions in its contracts with merchants.
These antisteering provisions prohibit merchants from
implying a preference for non-Amex cards; dissuading
customers from using Amex cards; persuading customers
to use other cards; imposing any special restrictions,
conditions, disadvantages, or fees on Amex cards; or pro-
moting other cards more than Amex. The antisteering
provisions do not, however, prevent merchants from steer-
ing customers toward debit cards, checks, or cash.
C
In October 2010, the United States and several States
(collectively, plaintiffs) sued Amex, claiming that its an-
tisteering provisions violate §1 of the Sherman Act, 26
Stat. 209, as amended, 15 U.S. C. §1.5 After a 7-week
trial, the District Court agreed that Amex’s antisteering
provisions violate §1. United States v. American Express
Co., 88 F. Supp. 3d 143, 151–152 (EDNY 2015). It found
that the credit-card market should be treated as two
separate markets—one for merchants and one for card-
holders. See id., at 171–175. Evaluating the effects on the
——————
5 Plaintiffs
also sued Visa and MasterCard, claiming that their anti-
steering provisions violated §1. But Visa and MasterCard voluntarily
revoked their antisteering provisions and are no longer parties to this
case.
8 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
merchant side of the market, the District Court found
that Amex’s antisteering provisions are anticompetitive
because they result in higher merchant fees. See id., at
195–224.
The Court of Appeals for the Second Circuit reversed.
United States v. American Express Co., 838 F.3d 179, 184
(2016). It concluded that the credit-card market is one
market, not two. Id., at 196–200. Evaluating the credit-
card market as a whole, the Second Circuit concluded that
Amex’s antisteering provisions were not anticompetitive
and did not violate §1. See id., at 200–206.
We granted certiorari, 583 U. S. ___ (2017), and now
affirm.
II
Section 1 of the Sherman Act prohibits “[e]very contract,
combination in the form of trust or otherwise, or conspir-
acy, in restraint of trade or commerce among the several
States.” 15 U.S. C. §1. This Court has long recognized
that, “[i]n view of the common law and the law in this
country” when the Sherman Act was passed, the phrase
“restraint of trade” is best read to mean “undue restraint.”
Standard Oil Co. of N. J. v. United States, 221 U.S. 1, 59–
60 (1911). This Court’s precedents have thus understood
§1 “to outlaw only unreasonable restraints.” State Oil Co.
v. Khan, 522 U.S. 3, 10 (1997) (emphasis added).
Restraints can be unreasonable in one of two ways. A
small group of restraints are unreasonable per se because
they “ ‘ “always or almost always tend to restrict competi-
tion and decrease output.” ’ ” Business Electronics Corp. v.
Sharp Electronics Corp., 485 U.S. 717, 723 (1988). Typi-
cally only “horizontal” restraints—restraints “imposed by
agreement between competitors”—qualify as unreasonable
per se. Id., at 730. Restraints that are not unreasonable
per se are judged under the “rule of reason.” Id., at 723.
The rule of reason requires courts to conduct a fact-specific
Cite as: 585 U. S. ____ (2018) 9
Opinion of the Court
assessment of “market power and market structure . . . to
assess the [restraint]’s actual effect” on competition.
Copperweld Corp. v. Independence Tube Corp., 467 U.S.
752, 768 (1984). The goal is to “distinguis[h] between
restraints with anticompetitive effect that are harmful to
the consumer and restraints stimulating competition that
are in the consumer’s best interest.” Leegin Creative
Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877, 886
(2007).
In this case, both sides correctly acknowledge that
Amex’s antisteering provisions are vertical restraints—
i.e., restraints “imposed by agreement between firms at
different levels of distribution.” Business Electronics,
supra, at 730. The parties also correctly acknowledge
that, like nearly every other vertical restraint, the anti-
steering provisions should be assessed under the rule of
reason. See Leegin, supra, at 882; State Oil, supra, at 19;
Business Electronics, supra, at 726; Continental T. V., Inc.
v. GTE Sylvania Inc., 433 U.S. 36, 57 (1977).
To determine whether a restraint violates the rule of
reason, the parties agree that a three-step, burden-
shifting framework applies. Under this framework, the
plaintiff has the initial burden to prove that the chal-
lenged restraint has a substantial anticompetitive effect
that harms consumers in the relevant market. See 1 J.
Kalinowski, Antitrust Laws and Trade Regulation
§12.02[1] (2d ed. 2017) (Kalinowski); P. Areeda & H.
Hovenkamp, Fundamentals of Antitrust Law §15.02[B]
(4th ed. 2017) (Areeda & Hovenkamp); Capital Imaging
Assoc., P. C. v. Mohawk Valley Medical Associates, Inc.,
996 F.2d 537, 543 (CA2 1993). If the plaintiff carries its
burden, then the burden shifts to the defendant to show a
procompetitive rationale for the restraint. See 1 Kalinow-
ski §12.02[1]; Areeda & Hovenkamp §15.02[B]; Capital
Imaging Assoc., supra, at 543. If the defendant makes
this showing, then the burden shifts back to the plaintiff
10 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
to demonstrate that the procompetitive efficiencies could
be reasonably achieved through less anticompetitive
means. See 1 Kalinowski §12.02[1]; Capital Imaging
Assoc., supra, at 543.
Here, the parties ask us to decide whether the plaintiffs
have carried their initial burden of proving that Amex’s
antisteering provisions have an anticompetitive effect.
The plaintiffs can make this showing directly or indirectly.
Direct evidence of anticompetitive effects would be “ ‘proof
of actual detrimental effects [on competition],’ ” FTC v.
Indiana Federation of Dentists, 476 U.S. 447, 460 (1986),
such as reduced output, increased prices, or decreased
quality in the relevant market, see 1 Kalinowski §12.02[2];
Craftsman Limousine, Inc. v. Ford Motor Co., 491 F.3d
381, 390 (CA8 2007); Virginia Atlantic Airways Ltd. v.
British Airways PLC, 257 F.3d 256, 264 (CA2 2001).
Indirect evidence would be proof of market power plus
some evidence that the challenged restraint harms compe-
tition. See 1 Kalinowski §12.02[2]; Tops Markets, Inc. v.
Quality Markets, Inc., 142 F.3d 90, 97 (CA2 1998); Span-
ish Broadcasting System of Fla. v. Clear Channel Commu-
nications, Inc., 376 F.3d 1065, 1073 (CA11 2004).
Here, the plaintiffs rely exclusively on direct evidence to
prove that Amex’s antisteering provisions have caused
anticompetitive effects in the credit-card market.6 To
assess this evidence, we must first define the relevant
market. Once defined, it becomes clear that the plaintiffs’
evidence is insufficient to carry their burden.
A
Because “[l]egal presumptions that rest on formalistic
distinctions rather than actual market realities are gener-
ally disfavored in antitrust law,” Eastman Kodak Co. v.
——————
6 Although the plaintiffs relied on indirect evidence below, they have
abandoned that argument in this Court. See Brief for United States 23,
n. 4 (citing Pet. for Cert. i, 18–25).
Cite as: 585 U. S. ____ (2018) 11
Opinion of the Court
Image Technical Services, Inc., 504 U.S. 451, 466–467
(1992), courts usually cannot properly apply the rule of
reason without an accurate definition of the relevant
market.7 “Without a definition of [the] market there is no
way to measure [the defendant’s] ability to lessen or de-
stroy competition.” Walker Process Equipment, Inc. v.
Food Machinery & Chemical Corp., 382 U.S. 172, 177
(1965); accord, 2 Kalinowski §24.01[4][a]. Thus, the rele-
vant market is defined as “the area of effective competi-
tion.” Ibid. Typically this is the “arena within which
significant substitution in consumption or production
occurs.” Areeda & Hovenkamp §5.02; accord, 2 Kalinow-
ski §24.02[1]; United States v. Grinnell Corp., 384 U. S.
——————
7 The plaintiffs argue that we need not define the relevant market in
this case because they have offered actual evidence of adverse effects on
competition—namely, increased merchant fees. See Brief for United
States 40–41 (citing FTC v. Indiana Federation of Dentists, 476 U.S.
447 (1986), and Catalano, Inc. v. Target Sales, Inc., 446 U.S. 643
(1980) (per curiam)). We disagree. The cases that the plaintiffs cite for
this proposition evaluated whether horizontal restraints had an ad-
verse effect on competition. See Indiana Federation of Dentists, supra,
at 450–451, 459 (agreement between competing dentists not to share X
rays with insurance companies); Catalano, supra, at 644–645, 650
(agreement among competing wholesalers not to compete on extending
credit to retailers). Given that horizontal restraints involve agree-
ments between competitors not to compete in some way, this Court
concluded that it did not need to precisely define the relevant market to
conclude that these agreements were anticompetitive. See Indiana
Federation of Dentists, supra, at 460–461; Catalano, supra, at 648–649.
But vertical restraints are different. See Arizona v. Maricopa County
Medical Soc., 457 U.S. 332, 348, n. 18 (1982); Leegin Creative Leather
Products, Inc. v. PSKS, Inc., 551 U.S. 877, 888 (2007). Vertical re-
straints often pose no risk to competition unless the entity imposing
them has market power, which cannot be evaluated unless the Court
first defines the relevant market. See id., at 898 (noting that a vertical
restraint “may not be a serious concern unless the relevant entity has
market power”); Easterbrook, Vertical Arrangements and the Rule of
Reason, 53 Antitrust L. J. 135, 160 (1984) (“[T]he possibly anticompeti-
tive manifestations of vertical arrangements can occur only if there is
market power”).
12 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
563, 571 (1966). But courts should “combin[e]” different
products or services into “a single market” when “that
combination reflects commercial realities.” Id., at 572; see
also Brown Shoe Co. v. United States, 370 U.S. 294, 336–
337 (1962) (pointing out that “the definition of the relevant
market” must “ ‘correspond to the commercial realities’ of
the industry”).
As explained, credit-card networks are two-sided plat-
forms. Due to indirect network effects, two-sided plat-
forms cannot raise prices on one side without risking a
feedback loop of declining demand. See Evans & Schma-
lensee 674–675; Evans & Noel 680–681. And the fact that
two-sided platforms charge one side a price that is below
or above cost reflects differences in the two sides’ demand
elasticity, not market power or anticompetitive pricing.
See Klein 574, 595, 598, 626. Price increases on one side
of the platform likewise do not suggest anticompetitive
effects without some evidence that they have increased the
overall cost of the platform’s services. See id., at 575, 594,
626. Thus, courts must include both sides of the plat-
form—merchants and cardholders—when defining the
credit-card market.
To be sure, it is not always necessary to consider both
sides of a two-sided platform. A market should be treated
as one sided when the impacts of indirect network effects
and relative pricing in that market are minor. See Fil-
istrucchi 321–322. Newspapers that sell advertisements,
for example, arguably operate a two-sided platform be-
cause the value of an advertisement increases as more
people read the newspaper. Id., at 297, 315; Klein 579.
But in the newspaper-advertisement market, the indirect
networks effects operate in only one direction; newspaper
readers are largely indifferent to the amount of advertis-
ing that a newspaper contains. See Filistrucchi 321, 323,
and n. 99; Klein 583. Because of these weak indirect
network effects, the market for newspaper advertising
Cite as: 585 U. S. ____ (2018) 13
Opinion of the Court
behaves much like a one-sided market and should be
analyzed as such. See Filistrucchi 321; Times-Picayune
Publishing Co. v. United States, 345 U.S. 594, 610 (1953).
But two-sided transaction platforms, like the credit-card
market, are different. These platforms facilitate a single,
simultaneous transaction between participants. For credit
cards, the network can sell its services only if a mer-
chant and cardholder both simultaneously choose to use
the network. Thus, whenever a credit-card network sells
one transaction’s worth of card-acceptance services to a
merchant it also must sell one transaction’s worth of card-
payment services to a cardholder. It cannot sell transac-
tion services to either cardholders or merchants individu-
ally. See Klein 583 (“Because cardholders and merchants
jointly consume a single product, payment card transac-
tions, their consumption of payment card transactions
must be directly proportional”). To optimize sales, the
network must find the balance of pricing that encourages
the greatest number of matches between cardholders and
merchants.
Because they cannot make a sale unless both sides of
the platform simultaneously agree to use their services,
two-sided transaction platforms exhibit more pronounced
indirect network effects and interconnected pricing and
demand. Transaction platforms are thus better under-
stood as “suppl[ying] only one product”—transactions.
Klein 580. In the credit-card market, these transactions
“are jointly consumed by a cardholder, who uses the pay-
ment card to make a transaction, and a merchant, who
accepts the payment card as a method of payment.” Ibid.
Tellingly, credit cards determine their market share by
measuring the volume of transactions they have sold.8
——————
8 Contrary to the dissent’s assertion, post, at 11–12, merchant ser-
vices and cardholder services are not complements. See Filistrucchi
297 (“[A] two-sided market [is] different from markets for complemen-
14 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
Evaluating both sides of a two-sided transaction plat-
form is also necessary to accurately assess competition.
Only other two-sided platforms can compete with a two-
sided platform for transactions. See Filistrucchi 301. A
credit-card company that processed transactions for mer-
chants, but that had no cardholders willing to use its card,
could not compete with Amex. See ibid. Only a company
that had both cardholders and merchants willing to use its
network could sell transactions and compete in the credit-
card market. Similarly, if a merchant accepts the four
major credit cards, but a cardholder only uses Visa or
Amex, only those two cards can compete for the particular
transaction. Thus, competition cannot be accurately
assessed by looking at only one side of the platform in
isolation.9
For all these reasons, “[i]n two-sided transaction mar-
kets, only one market should be defined.” Id., at 302; see
also Evans & Noel 671 (“[F]ocusing on one dimension of
. . . competition tends to distort the competition that actu-
ally exists among [two-sided platforms]”). Any other
analysis would lead to “ ‘ “mistaken inferences” ’ ” of the
kind that could “ ‘ “chill the very conduct the antitrust laws
are designed to protect.” ’ ” Brooke Group Ltd. v. Brown &
Williamson Tobacco Corp., 509 U.S. 209, 226 (1993); see
also Matsushita Elec. Industrial Co. v. Zenith Radio Corp.,
——————
tary products, in which both products are bought by the same buyers,
who, in their buying decisions, can therefore be expected to take into
account both prices”). As already explained, credit-card companies are
best understood as supplying only one product—transactions—which is
jointly consumed by a cardholder and a merchant. See Klein 580.
Merchant services and cardholder services are both inputs to this single
product. See ibid.
9 Nontransaction platforms, by contrast, often do compete with com-
panies that do not operate on both sides of their platform. A newspaper
that sells advertising, for example, might have to compete with a
television network, even though the two do not meaningfully compete
for viewers. See Filistrucchi 301.
Cite as: 585 U. S. ____ (2018) 15
Opinion of the Court
475 U.S. 574, 594 (1986) (“ ‘[W]e must be concerned lest a
rule or precedent that authorizes a search for a particular
type of undesirable pricing behavior end up by discourag-
ing legitimate price competition’ ”); Leegin, 551 U.S., at
895 (noting that courts should avoid “increas[ing] the total
cost of the antitrust system by prohibiting procompetitive
conduct the antitrust laws should encourage”). Accordingly,
we will analyze the two-sided market for credit-card
transactions as a whole to determine whether the plain-
tiffs have shown that Amex’s antisteering provisions have
anticompetitive effects.
B
The plaintiffs have not carried their burden to prove
anticompetitive effects in the relevant market. The plain-
tiffs stake their entire case on proving that Amex’s agree-
ments increase merchant fees. We find this argument
unpersuasive.
As an initial matter, the plaintiffs’ argument about
merchant fees wrongly focuses on only one side of the two-
sided credit-card market. As explained, the credit-card
market must be defined to include both merchants and
cardholders. Focusing on merchant fees alone misses the
mark because the product that credit-card companies sell
is transactions, not services to merchants, and the compet-
itive effects of a restraint on transactions cannot be judged
by looking at merchants alone. Evidence of a price in-
crease on one side of a two-sided transaction platform
cannot by itself demonstrate an anticompetitive exercise of
market power. To demonstrate anticompetitive effects on
the two-sided credit-card market as a whole, the plaintiffs
must prove that Amex’s antisteering provisions increased
the cost of credit-card transactions above a competitive
level, reduced the number of credit-card transactions, or
otherwise stifled competition in the credit-card market.
See 1 Kalinowski §12.02[2]; Craftsman Limousine, Inc.,
16 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
491 F.3d, at 390; Virginia Atlantic Airways Ltd., 257
F.3d, at 264. They failed to do so.
1
The plaintiffs did not offer any evidence that the price of
credit-card transactions was higher than the price one
would expect to find in a competitive market. As the
District Court found, the plaintiffs failed to offer any
reliable measure of Amex’s transaction price or profit
margins. 88 F. Supp. 3d, at 198, 215. And the evidence
about whether Amex charges more than its competitors
was ultimately inconclusive. Id., at 199, 202, 215.
Amex’s increased merchant fees reflect increases in the
value of its services and the cost of its transactions, not an
ability to charge above a competitive price. Amex began
raising its merchant fees in 2005 after Visa and Master-
Card raised their fees in the early 2000s. Id., at 195, 199–
200. As explained, Amex has historically charged higher
merchant fees than these competitors because it delivers
wealthier cardholders who spend more money. Id., at
200–201. Amex’s higher merchant fees are based on a
careful study of how much additional value its cardholders
offer merchants. See id., at 192–193. On the other side of
the market, Amex uses its higher merchant fees to offer its
cardholders a more robust rewards program, which is
necessary to maintain cardholder loyalty and encourage
the level of spending that makes Amex valuable to mer-
chants. Id., at 160, 191–195. That Amex allocates prices
between merchants and cardholders differently from Visa
and MasterCard is simply not evidence that it wields
market power to achieve anticompetitive ends. See Evans
& Noel 670–671; Klein 574–575, 594–595, 598, 626.
In addition, the evidence that does exist cuts against the
plaintiffs’ view that Amex’s antisteering provisions are the
cause of any increases in merchant fees. Visa and Master-
Card’s merchant fees have continued to increase, even
Cite as: 585 U. S. ____ (2018) 17
Opinion of the Court
at merchant locations where Amex is not accepted and,
thus, Amex’s antisteering provisions do not apply. See 88
F. Supp. 3d, at 222. This suggests that the cause of in-
creased merchant fees is not Amex’s antisteering provi-
sions, but rather increased competition for cardholders
and a corresponding marketwide adjustment in the rela-
tive price charged to merchants. See Klein 575, 609.
2
The plaintiffs did offer evidence that Amex increased
the percentage of the purchase price that it charges mer-
chants by an average of 0.09% between 2005 and 2010 and
that this increase was not entirely spent on cardholder
rewards. See 88 F. Supp. 3d, at 195–197, 215. The plain-
tiffs believe that this evidence shows that the price of
Amex’s transactions increased.
Even assuming the plaintiffs are correct, this evidence
does not prove that Amex’s antisteering provisions gave it
the power to charge anticompetitive prices. “Market
power is the ability to raise price profitably by restricting
output.” Areeda & Hovenkamp §5.01 (emphasis added);
accord, Kodak, 504 U.S., at 464; Business Electronics, 485
U.S., at 723. This Court will “not infer competitive injury
from price and output data absent some evidence that
tends to prove that output was restricted or prices were
above a competitive level.” Brooke Group Ltd., 509 U.S.,
at 237. There is no such evidence in this case. The output
of credit-card transactions grew dramatically from 2008 to
2013, increasing 30%. See 838 F.3d, at 206. “Where . . .
output is expanding at the same time prices are increas-
ing, rising prices are equally consistent with growing
product demand.” Brooke Group Ltd., supra, at 237. And,
as previously explained, the plaintiffs did not show that
Amex charged more than its competitors.
18 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
3
The plaintiffs also failed to prove that Amex’s antisteer-
ing provisions have stifled competition among credit-card
companies. To the contrary, while these agreements have
been in place, the credit-card market experienced expand-
ing output and improved quality. Amex’s business model
spurred Visa and MasterCard to offer new premium card
categories with higher rewards. And it has increased the
availability of card services, including free banking and
card-payment services for low-income customers who
otherwise would not be served. Indeed, between 1970 and
2001, the percentage of households with credit cards more
than quadrupled, and the proportion of households in the
bottom-income quintile with credit cards grew from just
2% to over 38%. See D. Evans & R. Schmalensee, Paying
With Plastic: The Digital Revolution in Buying and Bor-
rowing 88–89 (2d ed. 2005) (Paying With Plastic).
Nor have Amex’s antisteering provisions ended competi-
tion between credit-card networks with respect to mer-
chant fees. Instead, fierce competition between networks
has constrained Amex’s ability to raise these fees and has,
at times, forced Amex to lower them. For instance, when
Amex raised its merchant prices between 2005 and 2010,
some merchants chose to leave its network. 88 F. Supp.
3d, at 197. And when its remaining merchants com-
plained, Amex stopped raising its merchant prices. Id., at
198. In another instance in the late 1980s and early
1990s, competition forced Amex to offer lower merchant
fees to “everyday spend” merchants—supermarkets, gas
stations, pharmacies, and the like—to persuade them to
accept Amex. See id., at 160–161, 202.
In addition, Amex’s competitors have exploited its
higher merchant fees to their advantage. By charging
lower merchant fees, Visa, MasterCard, and Discover have
achieved broader merchant acceptance—approximately 3
million more locations than Amex. Id., at 204. This
Cite as: 585 U. S. ____ (2018) 19
Opinion of the Court
broader merchant acceptance is a major advantage for
these networks and a significant challenge for Amex, since
consumers prefer cards that will be accepted everywhere.
Ibid. And to compete even further with Amex, Visa and
MasterCard charge different merchant fees for different
types of cards to maintain their comparatively lower mer-
chant fees and broader acceptance. Over the long run,
this competition has created a trend of declining merchant
fees in the credit-card market. In fact, since the first
credit card was introduced in the 1950s, merchant fees—
including Amex’s merchant fees—have decreased by more
than half. See id., at 202–203; Paying With Plastic 54,
126, 152.
Lastly, there is nothing inherently anticompetitive
about Amex’s antisteering provisions. These agreements
actually stem negative externalities in the credit-card
market and promote interbrand competition. When mer-
chants steer cardholders away from Amex at the point of
sale, it undermines the cardholder’s expectation of “wel-
come acceptance”—the promise of a frictionless transac-
tion. 88 F. Supp. 3d, at 156. A lack of welcome acceptance
at one merchant makes a cardholder less likely to use
Amex at all other merchants. This externality endangers
the viability of the entire Amex network. And it under-
mines the investments that Amex has made to encourage
increased cardholder spending, which discourages invest-
ments in rewards and ultimately harms both cardholders
and merchants. Cf. Leegin, 551 U.S., at 890–891 (recog-
nizing that vertical restraints can prevent retailers from
free riding and thus increase the availability of “tangible
or intangible services or promotional efforts” that enhance
competition and consumer welfare). Perhaps most im-
portantly, antisteering provisions do not prevent Visa,
MasterCard, or Discover from competing against Amex by
offering lower merchant fees or promoting their broader
20 OHIO v. AMERICAN EXPRESS CO.
Opinion of the Court
merchant acceptance.10
In sum, the plaintiffs have not satisfied the first step of
the rule of reason. They have not carried their burden of
proving that Amex’s antisteering provisions have anti-
competitive effects. Amex’s business model has spurred
robust interbrand competition and has increased the
quality and quantity of credit-card transactions. And it is
“[t]he promotion of interbrand competition,” after all,
that “is . . . ‘the primary purpose of the antitrust laws.’” Id.,
at 890.
* * *
Because Amex’s antisteering provisions do not unrea-
sonably restrain trade, we affirm the judgment of the
Court of Appeals.
It is so ordered.
——————
10 The plaintiffs argue that United States v. Topco Associates, Inc.,
405 U.S. 596, 610 (1972), forbids any restraint that would restrict
competition in part of the market—here, for example, merchant steer-
ing. See Brief for Petitioners and Respondents Nebraska, Tennessee,
and Texas 30, 42. Topco does not stand for such a broad proposition.
Topco concluded that a horizontal agreement between competitors was
unreasonable per se, even though the agreement did not extend to every
competitor in the market. See 405 U.S., at 599, 608. A horizontal
agreement between competitors is markedly different from a vertical
agreement that incidentally affects one particular method of competi-
tion. See Leegin, 551 U.S., at 888; Maricopa County Medical Soc., 457
U.S., at 348, n. 18.
Cite as: 585 U. S. ____ (2018) 1
BREYER, J., dissenting
SUPREME COURT OF THE UNITED STATES
_________________
No. 16–1454
_________________
OHIO, ET AL., PETITIONERS v. AMERICAN EXPRESS
COMPANY, ET AL. | American Express Company and American Express Travel Related Services Company (collectively, Amex) provide credit-card services to both merchants and card- holders. When a cardholder buys something from a mer- chant who accepts Amex credit cards, Amex processes the transaction through its network, promptly pays the mer- chant, and subtracts a fee. If a merchant wants to accept Amex credit cards—and attract Amex cardholders to its business—Amex requires the merchant to agree to an antisteering contractual provision. The antisteering pro- vision prohibits merchants from discouraging customers from using their Amex card after they have already en- tered the store and are about to buy something, thereby avoiding Amex’s fee. In this case, we must decide whether Amex’s antisteering provisions violate federal antitrust law. We conclude they do not. I A Credit cards have become a primary way that consum- ers in the United States purchase goods and services. 2 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court When a cardholder uses a credit card to buy something from a merchant, the transaction is facilitated by a credit- card network. The network provides separate but inter- related services to both cardholders and merchants. For cardholders, the network extends them credit, which allows them to make purchases without cash and to defer payment until later. Cardholders also can receive rewards based on the amount of money they spend, such as airline miles, points for travel, or cash back. For merchants, the network allows them to avoid the cost of processing trans- actions and offers them quick, guaranteed payment. This saves merchants the trouble and risk of extending credit to customers, and it increases the number and value of sales that they can make. By providing these services to cardholders and mer- chants, credit-card companies bring these parties together, and therefore operate what economists call a “two-sided platform.” As the name implies, a two-sided platform offers different products or services to two different groups who both depend on the platform to intermediate between them. See Evans & Schmalensee, Markets With Two- Sided Platforms, 1 Issues in Competition L. & Pol’y 667 (2008) (Evans & Schmalensee); Evans & Noel, Defining Antitrust Markets When Firms Operate Two-Sided Plat- forms, ; Filistrucchi, Geradin, Van Damme, & Affeldt, Market Definition in Two-Sided Markets: Theory and Practice, J. Competition L. & Econ. 293, 296 (2014) (Filistrucchi). For credit cards, that interaction is a transac Thus, credit-card networks are a special type of two-sided plat- form known as a “transaction” platform. See 304, 307; Evans & Noel 676–678. The key feature of transaction platforms is that they cannot make a sale to one side of the platform without simultaneously making a sale to the other. See Klein, Lerner, Murphy, & Plache, Competition in Two-Sided Markets: The Antitrust Eco- Cite as: 585 U. S. (2018) 3 Opinion of the Court nomics of Payment Card Interchange Fees, 73 Antitrust L. J. 1, 580, 583 (2006) (Klein). For example, no credit- card transaction can occur unless both the merchant and the cardholder simultaneously agree to use the same credit-card network. See Filistrucchi 301. Two-sided platforms differ from traditional markets in important ways. Most relevant here, two-sided platforms often exhibit what economists call “indirect network ef- fects.” Evans & Schmalensee 667. Indirect network ef- fects exist where the value of the two-sided platform to one group of participants depends on how many members of a different group participate. D. Evans & R. Schmalensee, Matchmakers: The New Economics of Multisided Plat- forms 25 (2016). In other words, the value of the services that a two-sided platform provides increases as the num- ber of participants on both sides of the platform increases. A credit card, for example, is more valuable to cardholders when more merchants accept it, and is more valuable to merchants when more cardholders use it. See Evans & Noel 686–687; Klein 580, 584. To ensure sufficient partic- ipation, two-sided platforms must be sensitive to the prices that they charge each side. See Evans & Schma- lensee 675; Evans & Noel 680; Muris, Payment Card Regulation and the (Mis)Application of the Economics of Two-Sided Markets, 532– 533 (Muris); Rochet & Tirole, Platform Competition in Two-Sided Markets, 1 J. Eur. Econ. Assn. 990, 13 (2003). Raising the price on side A risks losing participa- tion on that side, which decreases the value of the plat- form to side B. If participants on side B leave due to this loss in value, then the platform has even less value to side A—risking a feedback loop of declining demand. See Evans & Schmalensee 675; Evans & Noel 680–681. Two- sided platforms therefore must take these indirect net- work effects into account before making a change in price on either side. See Evans & Schmalensee 675; Evans & 4 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court Noel 680–681.1 Sometimes indirect network effects require two-sided platforms to charge one side much more than the other. See Evans & Schmalensee 667, 675, 681, 690–691; Evans & Noel 691; Klein 585; Filistrucchi 300. For two- sided platforms, “ ‘the [relative] price structure matters, and platforms must design it so as to bring both sides on board.’ ” Evans & Schmalensee 669 (quoting Rochet & Tirole, Two-Sided Markets: A Progress Report, 37 RAND J. Econ. 645, 646 (2006)). The optimal price might require charging the side with more elastic demand a below-cost (or even negative) price. See Muris 519, 550; Klein 9; Evans & Schmalensee 675; Evans & Noel 681. With credit cards, for example, networks often charge cardholders a lower fee than merchants because cardholders are more price sensitive.2 See Muris 522; Klein 3–4, 585, 595. In fact, the network might well lose money on the card- holder side by offering rewards such as cash back, airline miles, or gift cards. See Klein 587; Evans & Schmalensee 672. The network can do this because increasing the number of cardholders increases the value of accepting the card to merchants and, thus, increases the number of —————— 1 Ina competitive market, indirect network effects also encourage companies to take increased profits from a price increase on side A and spend them on side B to ensure more robust participation on that side and to stem the impact of indirect network effects. See Evans & Schmalensee 688; Evans & Noel 670–671, 695. Indirect network effects thus limit the platform’s ability to raise overall prices and impose a check on its market power. See Evans & Schmalensee 688; Evans & Noel 695. 2 “Cardholders are more price-sensitive because many consumers have multiple payment methods, including alternative payment cards. Most merchants, by contrast, cannot accept just one major card because they are likely to lose profitable incremental sales if they do not take [all] the major payment cards. Because most consumers do not carry all of the major payment cards, refusing to accept a major card may cost the merchant substantial sales.” Muris 522. Cite as: 585 U. S. (2018) 5 Opinion of the Court merchants who accept it. Muris 522; Evans & Schma- lensee 692. Networks can then charge those merchants a fee for every transaction (typically a percentage of the purchase price). Striking the optimal balance of the prices charged on each side of the platform is essential for two- sided platforms to maximize the value of their services and to compete with their rivals. B Amex, Visa, MasterCard, and Discover are the four dominant participants in the credit-card market. Visa, which is by far the largest, has 45% of the market as measured by transaction volume.3 Amex and MasterCard trail with 26.4% and 23.3%, respectively, while Discover has just 5.3% of the market. Visa and MasterCard have significant structural ad- vantages over Amex. Visa and MasterCard began as bank cooperatives and thus almost every bank that offers credit cards is in the Visa or MasterCard network. This makes it very likely that the average consumer carries, and the average merchant accepts, Visa or MasterCard. As a result, the vast majority of Amex cardholders have a Visa or MasterCard, but only a small number of Visa and Master- Card cardholders have an Amex. Indeed, Visa and MasterCard account for more than 432 million cards in circulation in the United States, while Amex has only 53 million. And while 3.4 million merchants at 6.4 million locations accept Amex, nearly three million more locations accept Visa, MasterCard, and Discover.4 —————— 3 Allfigures are accurate as of 2013. 4 Discover entered the credit-card market several years after Amex, Visa, and MasterCard. It nonetheless managed to gain a foothold because Sears marketed Discover to its already significant base of private-label cardholders. Discover’s business model shares certain features with Amex, Visa, and MasterCard. Like Amex, Discover interacts directly with its cardholders. But like Visa and MasterCard, 6 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court Amex competes with Visa and MasterCard by using a different business model. While Visa and MasterCard earn half of their revenue by collecting interest from their cardholders, Amex does not. Amex instead earns most of its revenue from merchant fees. Amex’s business model thus focuses on cardholder spending rather than card- holder lending. To encourage cardholder spending, Amex provides better rewards than other networks. Due to its superior rewards, Amex tends to attract cardholders who are wealthier and spend more money. Merchants place a higher value on these cardholders, and Amex uses this advantage to recruit merchants. Amex’s business model has significantly influenced the credit-card market. To compete for the valuable cardhold- ers that Amex attracts, both Visa and MasterCard have introduced premium cards that, like Amex, charge mer- chants higher fees and offer cardholders better rewards. To maintain their lower merchant fees, Visa and Master- Card have created a sliding scale for their various cards— charging merchants less for low-reward cards and more for high-reward cards. This differs from Amex’s strategy, which is to charge merchants the same fee no matter the rewards that its card offers. Another way that Amex has influenced the credit-card market is by making banking and card-payment services available to low-income indi- viduals, who otherwise could not qualify for a credit card and could not afford the fees that traditional banks charge. See 2 Record 3835–3837, 4527–4529. In sum, Amex’s business model has stimulated competitive inno- vations in the credit-card market, increasing the volume of transactions and improving the quality of the services. Despite these improvements, Amex’s business model sometimes causes friction with merchants. To maintain —————— Discover uses banks that cooperate with its network to interact with merchants. Cite as: 585 U. S. (2018) 7 Opinion of the Court the loyalty of its cardholders, Amex must continually invest in its rewards program. But, to fund those invest- ments, Amex must charge merchants higher fees than its rivals. Even though Amex’s investments benefit mer- chants by encouraging cardholders to spend more money, merchants would prefer not to pay the higher fees. One way that merchants try to avoid them, while still enticing Amex’s cardholders to shop at their stores, is by dissuad- ing cardholders from using Amex at the point of sale. This practice is known as “steering.” Amex has prohibited steering since the 1950s by placing antisteering provisions in its contracts with merchants. These antisteering provisions prohibit merchants from implying a preference for non-Amex cards; dissuading customers from using Amex cards; persuading customers to use other cards; imposing any special restrictions, conditions, disadvantages, or fees on Amex cards; or pro- moting other cards more than Amex. The antisteering provisions do not, however, prevent merchants from steer- ing customers toward debit cards, checks, or cash. C In October 20, the United States and several States (collectively, plaintiffs) sued Amex, claiming that its an- tisteering provisions violate of the Sherman Act, 26 Stat. 209, as amended, 15 U.S. C.5 After a 7-week trial, the District Court agreed that Amex’s antisteering provisions violate United It found that the credit-card market should be treated as two separate markets—one for merchants and one for card- holders. See at 171–175. Evaluating the effects on the —————— 5 Plaintiffs also sued Visa and MasterCard, claiming that their anti- steering provisions violated But Visa and MasterCard voluntarily revoked their antisteering provisions and are no longer parties to this case. 8 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court merchant side of the market, the District Court found that Amex’s antisteering provisions are anticompetitive because they result in higher merchant fees. See at 195–224. The Court of Appeals for the Second Circuit reversed. United (2016). It concluded that the credit-card market is one market, not two. 6–200. Evaluating the credit- card market as a whole, the Second Circuit concluded that Amex’s antisteering provisions were not anticompetitive and did not violate See at 200–206. We granted certiorari, 583 U. S. (2017), and now affirm. II Section 1 of the Sherman Act prohibits “[e]very contract, combination in the form of trust or otherwise, or conspir- acy, in restraint of trade or commerce among the several States.” 15 U.S. C. This Court has long recognized that, “[i]n view of the common law and the law in this country” when the Sherman Act was passed, the phrase “restraint of trade” is best read to mean “undue restraint.” Standard Co. of N. 59– 60 (1911). This Court’s precedents have thus understood “to outlaw only unreasonable restraints.” State Co. v. Khan, Restraints can be unreasonable in one of two ways. A small group of restraints are unreasonable per se because they “ ‘ “always or almost always tend to restrict competi- tion and decrease output.” ’ ” Business Corp. v. Sharp Corp., Typi- cally only “horizontal” restraints—restraints “imposed by agreement between competitors”—qualify as unreasonable per se. Restraints that are not unreasonable per se are judged under the “rule of reason.” at The rule of reason requires courts to conduct a fact-specific Cite as: 585 U. S. (2018) 9 Opinion of the Court assessment of “market power and market structure to assess the [restraint]’s actual effect” on competi Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 768 (1984). The goal is to “distinguis[h] between restraints with anticompetitive effect that are harmful to the consumer and restraints stimulating competition that are in the consumer’s best interest.” Creative Leather Products, In this case, both sides correctly acknowledge that Amex’s antisteering provisions are vertical restraints— i.e., restraints “imposed by agreement between firms at different levels of distribu” Business The parties also correctly acknowledge that, like nearly every other vertical restraint, the anti- steering provisions should be assessed under the rule of reason. See ; State ; Business ; Continental T. V., Inc. v. GTE Sylvania Inc., To determine whether a restraint violates the rule of reason, the parties agree that a three-step, burden- shifting framework applies. Under this framework, the plaintiff has the initial burden to prove that the chal- lenged restraint has a substantial anticompetitive effect that harms consumers in the relevant market. See 1 J. Kalinowski, Antitrust Laws and Trade Regulation 2.02[1] (2d ed. 2017) (Kalinowski); P. Areeda & H. Hovenkamp, Fundamentals of Antitrust Law 5.02[B] (4th ed. 2017) (Areeda & Hovenkamp); Capital Imaging P. If the plaintiff carries its burden, then the burden shifts to the defendant to show a procompetitive rationale for the restraint. See 1 Kalinow- ski 2.02[1]; Areeda & Hovenkamp 5.02[B]; Capital Imaging at If the defendant makes this showing, then the burden shifts back to the plaintiff OHIO v. AMERICAN EXPRESS CO. Opinion of the Court to demonstrate that the procompetitive efficiencies could be reasonably achieved through less anticompetitive means. See 1 Kalinowski 2.02[1]; Capital Imaging at Here, the parties ask us to decide whether the plaintiffs have carried their initial burden of proving that Amex’s antisteering provisions have an anticompetitive effect. The plaintiffs can make this showing directly or indirectly. Direct evidence of anticompetitive effects would be “ ‘proof of actual detrimental effects [on competition],’ ” FTC v. Indiana Federation of such as reduced output, increased prices, or decreased quality in the relevant market, see 1 Kalinowski 2.02[2]; Craftsman Limousine, Inc. v. Ford Motor Co., 491 F.3d 381, 390 ; Virginia Atlantic Airways v. British Airways PLC, 2 F.3d 256, Indirect evidence would be proof of market power plus some evidence that the challenged restraint harms compe- ti See 1 Kalinowski 2.02[2]; Tops Markets, Inc. v. Quality Markets, Inc., ; Span- ish Broadcasting System of 376 F.3d 65, 73 Here, the plaintiffs rely exclusively on direct evidence to prove that Amex’s antisteering provisions have caused anticompetitive effects in the credit-card market.6 To assess this evidence, we must first define the relevant market. Once defined, it becomes clear that the plaintiffs’ evidence is insufficient to carry their burden. A Because “[l]egal presumptions that rest on formalistic distinctions rather than actual market realities are gener- ally disfavored in antitrust law,” Eastman Co. v. —————— 6 Although the plaintiffs relied on indirect evidence below, they have abandoned that argument in this Court. See Brief for United States 23, n. 4 (citing Pet. for Cert. i, 18–25). Cite as: 585 U. S. (2018) 11 Opinion of the Court Image Technical Services, Inc., 466–467 (1992), courts usually cannot properly apply the rule of reason without an accurate definition of the relevant market.7 “Without a definition of [the] market there is no way to measure [the defendant’s] ability to lessen or de- stroy competi” Walker Process Equipment, Inc. v. Food Machinery & Chemical Corp., (1965); accord, 2 Kalinowski Thus, the rele- vant market is defined as “the area of effective competi- ” Typically this is the “arena within which significant substitution in consumption or production occurs.” Areeda & Hovenkamp accord, 2 Kalinow- ski United States v. Grinnell Corp., 384 U. S. —————— 7 The plaintiffs argue that we need not define the relevant market in this case because they have offered actual evidence of adverse effects on competition—namely, increased merchant fees. See Brief for United States 40–41 and (1980) (per curiam)). We disagree. The cases that the plaintiffs cite for this proposition evaluated whether horizontal restraints had an ad- verse effect on competi See Indiana Federation of at 450–451, 459 (agreement between competing dentists not to share X rays with insurance companies); at 644–645, 650 (agreement among competing wholesalers not to compete on extending credit to retailers). Given that horizontal restraints involve agree- ments between competitors not to compete in some way, this Court concluded that it did not need to precisely define the relevant market to conclude that these agreements were anticompetitive. See Indiana Federation of at –461; at 648–649. But vertical restraints are different. See 4 U.S. 332, ; Creative Leather Products, Vertical re- straints often pose no risk to competition unless the entity imposing them has market power, which cannot be evaluated unless the Court first defines the relevant market. See (noting that a vertical restraint “may not be a serious concern unless the relevant entity has market power”); Easterbrook, Vertical Arrangements and the Rule of Reason, 53 Antitrust L. J. 135, 160 (1984) (“[T]he possibly anticompeti- tive manifestations of vertical arrangements can occur only if there is market power”). 12 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court 563, 1 (1966). But courts should “combin[e]” different products or services into “a single market” when “that combination reflects commercial realities.” at 2; see also Brown Shoe 336– 337 (1962) (pointing out that “the definition of the relevant market” must “ ‘correspond to the commercial realities’ of the industry”). As explained, credit-card networks are two-sided plat- forms. Due to indirect network effects, two-sided plat- forms cannot raise prices on one side without risking a feedback loop of declining demand. See Evans & Schma- lensee 674–675; Evans & Noel 680–681. And the fact that two-sided platforms charge one side a price that is below or above cost reflects differences in the two sides’ demand elasticity, not market power or anticompetitive pricing. See Klein 4, 595, 598, 626. Price increases on one side of the platform likewise do not suggest anticompetitive effects without some evidence that they have increased the overall cost of the platform’s services. See at 5, 626. Thus, courts must include both sides of the plat- form—merchants and cardholders—when defining the credit-card market. To be sure, it is not always necessary to consider both sides of a two-sided platform. A market should be treated as one sided when the impacts of indirect network effects and relative pricing in that market are minor. See Fil- istrucchi 321–322. Newspapers that sell advertisements, for example, arguably operate a two-sided platform be- cause the value of an advertisement increases as more people read the newspaper. at 2, 315; Klein 9. But in the newspaper-advertisement market, the indirect networks effects operate in only one direction; newspaper readers are largely indifferent to the amount of advertis- ing that a newspaper contains. See Filistrucchi 321, 323, and n. 99; Klein 583. Because of these weak indirect network effects, the market for newspaper advertising Cite as: 585 U. S. (2018) 13 Opinion of the Court behaves much like a one-sided market and should be analyzed as such. See Filistrucchi 321; Times-Picayune Publishing 6 But two-sided transaction platforms, like the credit-card market, are different. These platforms facilitate a single, simultaneous transaction between participants. For credit cards, the network can sell its services only if a mer- chant and cardholder both simultaneously choose to use the network. Thus, whenever a credit-card network sells one transaction’s worth of card-acceptance services to a merchant it also must sell one transaction’s worth of card- payment services to a cardholder. It cannot sell transac- tion services to either cardholders or merchants individu- ally. See Klein 583 (“Because cardholders and merchants jointly consume a single product, payment card transac- tions, their consumption of payment card transactions must be directly proportional”). To optimize sales, the network must find the balance of pricing that encourages the greatest number of matches between cardholders and merchants. Because they cannot make a sale unless both sides of the platform simultaneously agree to use their services, two-sided transaction platforms exhibit more pronounced indirect network effects and interconnected pricing and demand. Transaction platforms are thus better under- stood as “suppl[ying] only one product”—transactions. Klein 580. In the credit-card market, these transactions “are jointly consumed by a cardholder, who uses the pay- ment card to make a transaction, and a merchant, who accepts the payment card as a method of payment.” Tellingly, credit cards determine their market share by measuring the volume of transactions they have sold.8 —————— 8 Contrary to the dissent’s assertion, post, at 11–12, merchant ser- vices and cardholder services are not complements. See Filistrucchi 2 (“[A] two-sided market [is] different from markets for complemen- 14 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court Evaluating both sides of a two-sided transaction plat- form is also necessary to accurately assess competi Only other two-sided platforms can compete with a two- sided platform for transactions. See Filistrucchi 301. A credit-card company that processed transactions for mer- chants, but that had no cardholders willing to use its card, could not compete with Amex. See Only a company that had both cardholders and merchants willing to use its network could sell transactions and compete in the credit- card market. Similarly, if a merchant accepts the four major credit cards, but a cardholder only uses Visa or Amex, only those two cards can compete for the particular transac Thus, competition cannot be accurately assessed by looking at only one side of the platform in isola9 For all these reasons, “[i]n two-sided transaction mar- kets, only one market should be defined.” ; see also Evans & Noel 671 (“[F]ocusing on one dimension of competition tends to distort the competition that actu- ally exists among [two-sided platforms]”). Any other analysis would lead to “ ‘ “mistaken inferences” ’ ” of the kind that could “ ‘ “chill the very conduct the antitrust laws are designed to protect.” ’ ” Brooke Group ; see also Matsushita Elec. Industrial Co. v. Zenith Radio Corp., —————— tary products, in which both products are bought by the same buyers, who, in their buying decisions, can therefore be expected to take into account both prices”). As already explained, credit-card companies are best understood as supplying only one product—transactions—which is jointly consumed by a cardholder and a merchant. See Klein 580. Merchant services and cardholder services are both inputs to this single product. See 9 Nontransaction platforms, by contrast, often do compete with com- panies that do not operate on both sides of their platform. A newspaper that sells advertising, for example, might have to compete with a television network, even though the two do not meaningfully compete for viewers. See Filistrucchi 301. Cite as: 585 U. S. (2018) 15 Opinion of the Court 475 U.S. 4, (“ ‘[W]e must be concerned lest a rule or precedent that authorizes a search for a particular type of undesirable pricing behavior end up by discourag- ing legitimate price competition’ ”); 551 U.S., at 895 (noting that courts should avoid “increas[ing] the total cost of the antitrust system by prohibiting procompetitive conduct the antitrust laws should encourage”). Accordingly, we will analyze the two-sided market for credit-card transactions as a whole to determine whether the plain- tiffs have shown that Amex’s antisteering provisions have anticompetitive effects. B The plaintiffs have not carried their burden to prove anticompetitive effects in the relevant market. The plain- tiffs stake their entire case on proving that Amex’s agree- ments increase merchant fees. We find this argument unpersuasive. As an initial matter, the plaintiffs’ argument about merchant fees wrongly focuses on only one side of the two- sided credit-card market. As explained, the credit-card market must be defined to include both merchants and cardholders. Focusing on merchant fees alone misses the mark because the product that credit-card companies sell is transactions, not services to merchants, and the compet- itive effects of a restraint on transactions cannot be judged by looking at merchants alone. Evidence of a price in- crease on one side of a two-sided transaction platform cannot by itself demonstrate an anticompetitive exercise of market power. To demonstrate anticompetitive effects on the two-sided credit-card market as a whole, the plaintiffs must prove that Amex’s antisteering provisions increased the cost of credit-card transactions above a competitive level, reduced the number of credit-card transactions, or otherwise stifled competition in the credit-card market. See 1 Kalinowski 2.02[2]; Craftsman Limousine, Inc., 16 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court ; Virginia Atlantic Airways 2 F.3d, at They failed to do so. 1 The plaintiffs did not offer any evidence that the price of credit-card transactions was higher than the price one would expect to find in a competitive market. As the District Court found, the plaintiffs failed to offer any reliable measure of Amex’s transaction price or profit 88 F. Supp. 3d, 8, 215. And the evidence about whether Amex charges more than its competitors was ultimately inconclusive. 9, 202, 215. Amex’s increased merchant fees reflect increases in the value of its services and the cost of its transactions, not an ability to charge above a competitive price. Amex began raising its merchant fees in 2005 after Visa and Master- Card raised their fees in the early 2000s. 5, 199– 200. As explained, Amex has historically charged higher merchant fees than these competitors because it delivers wealthier cardholders who spend more money. at 200–201. Amex’s higher merchant fees are based on a careful study of how much additional value its cardholders offer merchants. See 2–193. On the other side of the market, Amex uses its higher merchant fees to offer its cardholders a more robust rewards program, which is necessary to maintain cardholder loyalty and encourage the level of spending that makes Amex valuable to mer- chants. 191–195. That Amex allocates prices between merchants and cardholders differently from Visa and MasterCard is simply not evidence that it wields market power to achieve anticompetitive ends. See Evans & Noel 670–671; Klein 4–5, –595, 598, 626. In addition, the evidence that does exist cuts against the plaintiffs’ view that Amex’s antisteering provisions are the cause of any increases in merchant fees. Visa and Master- Card’s merchant fees have continued to increase, even Cite as: 585 U. S. (2018) 17 Opinion of the Court at merchant locations where Amex is not accepted and, thus, Amex’s antisteering provisions do not apply. See 88 F. Supp. 3d, at 222. This suggests that the cause of in- creased merchant fees is not Amex’s antisteering provi- sions, but rather increased competition for cardholders and a corresponding marketwide adjustment in the rela- tive price charged to merchants. See Klein 5, 609. 2 The plaintiffs did offer evidence that Amex increased the percentage of the purchase price that it charges mer- chants by an average of 0.09% between 2005 and 20 and that this increase was not entirely spent on cardholder rewards. See 88 F. Supp. 3d, 5–1, 215. The plain- tiffs believe that this evidence shows that the price of Amex’s transactions increased. Even assuming the plaintiffs are correct, this evidence does not prove that Amex’s antisteering provisions gave it the power to charge anticompetitive prices. “Market power is the ability to raise price profitably by restricting output.” Areeda & Hovenkamp ; accord, ; Business 485 U.S., at This Court will “not infer competitive injury from price and output data absent some evidence that tends to prove that output was restricted or prices were above a competitive level.” Brooke Group 509 U.S., There is no such evidence in this case. The output of credit-card transactions grew dramatically from 2008 to 2013, increasing 30%. See “Where output is expanding at the same time prices are increas- ing, rising prices are equally consistent with growing product demand.” Brooke Group And, as previously explained, the plaintiffs did not show that Amex charged more than its competitors. 18 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court 3 The plaintiffs also failed to prove that Amex’s antisteer- ing provisions have stifled competition among credit-card companies. To the contrary, while these agreements have been in place, the credit-card market experienced expand- ing output and improved quality. Amex’s business model spurred Visa and MasterCard to offer new premium card categories with higher rewards. And it has increased the availability of card services, including free banking and card-payment services for low-income customers who otherwise would not be served. Indeed, between 10 and the percentage of households with credit cards more than quadrupled, and the proportion of households in the bottom-income quintile with credit cards grew from just 2% to over 38%. See D. Evans & R. Schmalensee, Paying With Plastic: The Digital Revolution in Buying and Bor- rowing 88–89 (2d ed. 2005) (Paying With Plastic). Nor have Amex’s antisteering provisions ended competi- tion between credit-card networks with respect to mer- chant fees. Instead, fierce competition between networks has constrained Amex’s ability to raise these fees and has, at times, forced Amex to lower them. For instance, when Amex raised its merchant prices between 2005 and 20, some merchants chose to leave its network. 88 F. Supp. 3d, 7. And when its remaining merchants com- plained, Amex stopped raising its merchant prices. at 198. In another instance in the late 1980s and early 1990s, competition forced Amex to offer lower merchant fees to “everyday spend” merchants—supermarkets, gas stations, pharmacies, and the like—to persuade them to accept Amex. See –161, 202. In addition, Amex’s competitors have exploited its higher merchant fees to their advantage. By charging lower merchant fees, Visa, MasterCard, and Discover have achieved broader merchant acceptance—approximately 3 million more locations than Amex. This Cite as: 585 U. S. (2018) 19 Opinion of the Court broader merchant acceptance is a major advantage for these networks and a significant challenge for Amex, since consumers prefer cards that will be accepted everywhere. And to compete even further with Amex, Visa and MasterCard charge different merchant fees for different types of cards to maintain their comparatively lower mer- chant fees and broader acceptance. Over the long run, this competition has created a trend of declining merchant fees in the credit-card market. In fact, since the first credit card was introduced in the 1950s, merchant fees— including Amex’s merchant fees—have decreased by more than half. See at 202–203; Paying With Plastic 54, 126, 152. Lastly, there is nothing inherently anticompetitive about Amex’s antisteering provisions. These agreements actually stem negative externalities in the credit-card market and promote interbrand competi When mer- chants steer cardholders away from Amex at the point of sale, it undermines the cardholder’s expectation of “wel- come acceptance”—the promise of a frictionless transac- A lack of welcome acceptance at one merchant makes a cardholder less likely to use Amex at all other merchants. This externality endangers the viability of the entire Amex network. And it under- mines the investments that Amex has made to encourage increased cardholder spending, which discourages invest- ments in rewards and ultimately harms both cardholders and merchants. Cf. –891 (recog- nizing that vertical restraints can prevent retailers from free riding and thus increase the availability of “tangible or intangible services or promotional efforts” that enhance competition and consumer welfare). Perhaps most im- portantly, antisteering provisions do not prevent Visa, MasterCard, or Discover from competing against Amex by offering lower merchant fees or promoting their broader 20 OHIO v. AMERICAN EXPRESS CO. Opinion of the Court merchant acceptance. In sum, the plaintiffs have not satisfied the first step of the rule of reason. They have not carried their burden of proving that Amex’s antisteering provisions have anti- competitive effects. Amex’s business model has spurred robust interbrand competition and has increased the quality and quantity of credit-card transactions. And it is “[t]he promotion of interbrand competition,” after all, that “is ‘the primary purpose of the antitrust laws.’” at 890. * * * Because Amex’s antisteering provisions do not unrea- sonably restrain trade, we affirm the judgment of the Court of Appeals. It is so ordered. —————— The plaintiffs argue that United 6 (12), forbids any restraint that would restrict competition in part of the market—here, for example, merchant steer- ing. See Brief for Petitioners and Respondents Nebraska, Tennessee, and Texas 30, 42. Topco does not stand for such a broad proposi Topco concluded that a horizontal agreement between competitors was unreasonable per se, even though the agreement did not extend to every competitor in the market. See 608. A horizontal agreement between competitors is markedly different from a vertical agreement that incidentally affects one particular method of competi- See 551 U.S., at ; Maricopa County Medical Soc., 4 U.S., at Cite as: 585 U. S. (2018) 1 BREYER, J., dissenting SUPREME COURT OF THE UNITED STATES No. 16–1454 OHIO, ET AL., PETITIONERS v. AMERICAN EXPRESS COMPANY, ET AL. |
Justice Thomas | majority | false | Quanta Computer, Inc. v. LG Electronics, Inc. | 2008-06-09T00:00:00 | null | https://www.courtlistener.com/opinion/145800/quanta-computer-inc-v-lg-electronics-inc/ | https://www.courtlistener.com/api/rest/v3/clusters/145800/ | 2,008 | 2007-048 | 2 | 9 | 0 | For over 150 years this Court has applied the doctrine of patent exhaustion to limit the patent rights that survive the initial authorized sale of a patented item. In this case, we decide whether patent exhaustion applies to the sale of components of a patented system that must be combined with additional components in order to practice the patented methods. The Court of Appeals for the Federal Circuit held that the doctrine does not apply to method patents at all and, in the alternative, that it does not apply here because the sales were not authorized by the license agreement. We disagree on both scores. Because the exhaustion doctrine applies to method patents, and because the license authorizes the sale of components that substantially embody the patents in suit, the sale exhausted the patents.
I
Respondent LG Electronics, Inc. (LGE), purchased a portfolio of computer technology patents in 1999, including the three patents at issue here: U.S. Patent Nos. 4,939,641 ('641); 5,379,379 ('379); and 5,077,733 ('733) (collectively LGE Patents). The main functions of a computer system are carried out on a microprocessor, or central processing unit, which interprets program instructions, processes data, and controls other devices in the system. A set of wires, or bus, connects the microprocessor to a chipset, which transfers data between the microprocessor and other devices, including the keyboard, mouse, monitor, hard drive, memory, and disk drives.
The data processed by the computer are stored principally in random access memory, also called main memory. Webster's New World Dictionary of Computer Terms 334, 451 (8th ed.2000). Frequently accessed data are generally stored in cache memory, which permits faster access than main memory and is often located on the microprocessor itself. Id., at 84. When copies of data are stored in both the cache and main memory, problems may arise when one copy is changed but the other still contains the original "stale" version of the data. J. Handy, Cache Memory Book 124 (2d ed.1993). The '641 patent addresses this problem. It discloses a system for ensuring that the most current data are retrieved from main memory by monitoring data requests and updating main memory from the cache when stale data are requested. LG Electronics, Inc. v. Bizcom Electronics, Inc., 453 F.3d 1364, 1377 (C.A.Fed.2006).
The '379 patent relates to the coordination of requests to read from, and write to, main memory. Id., at 1378. Processing these requests in chronological order can slow down a system because read requests are faster to execute than write requests. Processing all read requests first ensures speedy access, but may result in the retrieval of outdated data if a read request for a certain piece of data is processed before an outstanding write request for the same data. The '379 patent discloses an efficient method of organizing read and write requests while maintaining accuracy by allowing the computer to execute only read requests until it needs data for which there is an outstanding write request. LG Electronics, Inc. v. Asustek Computer, Inc., No. C 01-02187 CW et al., Order Construing Disputed Terms and Phrases, p. 42 (ND Cal., Aug. 20, 2002). Upon receiving such a read request, the computer executes pending write requests first and only then returns to the read requests so that the most up-to-date data are retrieved. Ibid.
The '733 patent addresses the problem of managing the data traffic on a bus connecting two computer components, so *2114 that no one device monopolizes the bus. It allows multiple devices to share the bus, giving heavy users greater access. This patent describes methods that establish a rotating priority system under which each device alternately has priority access to the bus for a preset number of cycles and heavier users can maintain priority for more cycles without "hogging" the device indefinitely. Id., at 37-38.
LGE licensed a patent portfolio, including the LGE Patents, to Intel Corporation (Intel). The cross-licensing agreement (License Agreement) permits Intel to manufacture and sell microprocessors and chipsets that use the LGE Patents (the Intel Products). The License Agreement authorizes Intel to "`make, use, sell (directly or indirectly), offer to sell, import or otherwise dispose of'" its own products practicing the LGE Patents. Brief for Petitioners 8 (quoting App. 154).[1] Notwithstanding this broad language, the License Agreement contains some limitations. Relevant here, it stipulates that no license
"`is granted by either party hereto . . . to any third party for the combination by a third party of Licensed Products of either party with items, components, or the like acquired . . . from sources other than a party hereto, or for the use, import, offer for sale or sale of such combination.'" Brief for Petitioners 8 (quoting App. 164).
The License Agreement purports not to alter the usual rules of patent exhaustion, however, providing that, "`[n]otwithstanding anything to the contrary contained in this Agreement, the parties agree that nothing herein shall in any way limit or alter the effect of patent exhaustion that would otherwise apply when a party hereto sells any of its Licensed Products.'" Brief for Petitioners 8 (quoting App. 164).
In a separate agreement (Master Agreement), Intel agreed to give written notice to its own customers informing them that, while it had obtained a broad license "`ensur[ing] that any Intel product that you purchase is licensed by LGE and thus does not infringe any patent held by LGE,'" the license "`does not extend, expressly or by implication, to any product that you make by combining an Intel product with any non-Intel product.'" Brief for Respondent 9 (emphasis deleted) (quoting App. 198). The Master Agreement also provides that "`a breach of this Agreement shall have no effect on and shall not be grounds for termination of the Patent License.'" Brief for Petitioners 9 (quoting App. 176).
Petitioners, including Quanta Computer (collectively Quanta), are a group of computer manufacturers. Quanta purchased microprocessors and chipsets from Intel and received the notice required by the Master Agreement. Nonetheless, Quanta manufactured computers using Intel parts in combination with non-Intel memory and buses in ways that practice the LGE Patents. Quanta does not modify the Intel components and follows Intel's specifications to incorporate the parts into its own systems.
LGE filed a complaint against Quanta, asserting that the combination of the Intel Products with non-Intel memory and buses infringed the LGE Patents. The District Court granted summary judgment to Quanta, holding that, for purposes of the patent exhaustion doctrine, the license LGE granted to Intel resulted in forfeiture of any potential infringement actions *2115 against legitimate purchasers of the Intel Products. LG Electronics, Inc. v. Asustek Computer, Inc., 65 U.S.P.Q. 2d (BNA) 1589, 1593, 1600 (N.D.Cal.2002). The court found that, although the Intel Products do not fully practice any of the patents at issue, they have no reasonable noninfringing use and therefore their authorized sale exhausted patent rights in the completed computers under United States v. Univis Lens Co., 316 U.S. 241, 62 S. Ct. 1088, 86 L. Ed. 1408 (1942). Asustek, supra, at 1598-1600. In a subsequent order limiting its summary judgment ruling, the court held that patent exhaustion applies only to apparatus or composition-of-matter claims that describe a physical object, and does not apply to process, or method, claims that describe operations to make or use a product. LG Electronics, Inc. v. Asustek Computer, Inc., 248 F. Supp. 2d 912, 918 (N.D.Cal.2003). Because each of the LGE Patents includes method claims, exhaustion did not apply.
The Court of Appeals for the Federal Circuit affirmed in part and reversed in part. It agreed that the doctrine of patent exhaustion does not apply to method claims. In the alternative, it concluded that exhaustion did not apply because LGE did not license Intel to sell the Intel Products to Quanta for use in combination with non-Intel products. 453 F.3d, at 1370.
We granted certiorari, 551 U.S. ___, 128 S. Ct. 28, 168 L. Ed. 2d 805 (2007).
II
The longstanding doctrine of patent exhaustion provides that the initial authorized sale of a patented item terminates all patent rights to that item. This Court first applied the doctrine in 19th-century cases addressing patent extensions on the Woodworth planing machine. Purchasers of licenses to sell and use the machine for the duration of the original patent term sought to continue using the licenses through the extended term. The Court held that the extension of the patent term did not affect the rights already secured by purchasers who bought the item for use "in the ordinary pursuits of life." Bloomer v. McQuewan, 14 How. 539, 549, 14 L. Ed. 532 (1853); see also ibid. ("[W]hen the machine passes to the hands of the purchaser, it is no longer within the limits of the monopoly"); Bloomer v. Millinger, 1 Wall. 340, 351, 17 L. Ed. 581 (1864). In Adams v. Burke, 17 Wall. 453, 21 L. Ed. 700 (1873), the Court affirmed the dismissal of a patent holder's suit alleging that a licensee had violated postsale restrictions on where patented coffin-lids could be used. "[W]here a person ha[s] purchased a patented machine of the patentee or his assignee," the Court held, "this purchase carrie[s] with it the right to the use of that machine so long as it [is] capable of use." Id., at 455.
Although the Court permitted postsale restrictions on the use of a patented article in Henry v. A.B. Dick Co., 224 U.S. 1, 32 S. Ct. 364, 56 L. Ed. 645 (1912),[2] that *2116 decision was short lived. In 1913, the Court refused to apply A.B. Dick to uphold price-fixing provisions in a patent license. See Bauer & Cie v. O'Donnell, 229 U.S. 1, 14-17, 33 S. Ct. 616, 57 L. Ed. 1041 (1913). Shortly thereafter, in Motion Picture Patents Co. v. Universal Film Mfg. Co., 243 U.S. 502, 518, 37 S. Ct. 416, 61 L. Ed. 871 (1917), the Court explicitly overruled A.B. Dick. In that case, a patent holder attempted to limit purchasers' use of its film projectors to show only film made under a patent held by the same company. The Court noted the "increasing frequency" with which patent holders were using A.B. Dick-style licenses to limit the use of their products and thereby using the patents to secure market control of related, unpatented items. 243 U.S., at 509, 516-517, 37 S. Ct. 416. Observing that "the primary purpose of our patent laws is not the creation of private fortunes for the owners of patents but is `to promote the progress of science and useful arts,'" id., at 511, 37 S. Ct. 416 (quoting U.S. Const., Art. I, § 8, cl. 8), the Court held that "the scope of the grant which may be made to an inventor in a patent, pursuant to the [patent] statute, must be limited to the invention described in the claims of his patent." 243 U.S., at 511, 37 S. Ct. 416. Accordingly, it reiterated the rule that "the right to vend is exhausted by a single, unconditional sale, the article sold being thereby carried outside the monopoly of the patent law and rendered free of every restriction which the vendor may attempt to put upon it." Id., at 516, 37 S. Ct. 416.
This Court most recently discussed patent exhaustion in Univis, 316 U.S. 241, 62 S. Ct. 1088, 86 L. Ed. 1408, on which the District Court relied. Univis Lens Company, the holder of patents on eyeglass lenses, licensed a purchaser to manufacture lens blanks[3] by fusing together different lens segments to create bi- and tri-focal lenses and to sell them to other Univis licensees at agreed-upon rates. Wholesalers were licensed to grind the blanks into the patented finished lenses, which they would then sell to Univis-licensed prescription retailers for resale at a fixed rate. Finishing retailers, after grinding the blanks into patented lenses, would sell the finished lenses to consumers at the same fixed rate. The United States sued Univis under the Sherman Act, 15 U.S.C. §§ 1, 3, 15, alleging unlawful restraints on trade. Univis asserted its patent monopoly rights as a defense to the antitrust suit. The Court granted certiorari to determine whether Univis' patent monopoly survived the sale of the lens blanks by the licensed manufacturer and therefore shielded Univis' pricing scheme from the Sherman Act.
The Court assumed that the Univis patents containing claims for finished lenses were practiced in part by the wholesalers and finishing retailers who ground the blanks into lenses, and held that the sale of the lens blanks exhausted the patents on the finished lenses. Univis, 316 U.S., at 248-249, 62 S. Ct. 1088. The Court explained that the lens blanks "embodi[ed] essential features of the patented device and [were] without utility until . . . ground and polished as the finished lens of the patent." Id., at 249, 62 S. Ct. 1088. The Court noted that:
"where one has sold an uncompleted article which, because it embodies essential features of his patented invention, is within the protection of his patent, and has destined the article to be finished by the purchaser in conformity to the patent, he has sold his invention so far as it *2117 is or may be embodied in that particular article." Id., at 250-251, 62 S. Ct. 1088.
In sum, the Court concluded that the traditional bar on patent restrictions following the sale of an item applies when the item sufficiently embodies the patent even if it does not completely practice the patentsuch that its only and intended use is to be finished under the terms of the patent.
With this history of the patent exhaustion doctrine in mind, we turn to the parties' arguments.
III
A
LGE argues that the exhaustion doctrine is inapplicable here because it does not apply to method claims, which are contained in each of the LGE Patents. LGE reasons that, because method patents are linked not to a tangible article but to a process, they can never be exhausted through a sale. Rather, practicing the patentwhich occurs upon each use of an article embodying a method patentis permissible only to the extent rights are transferred in an assignment contract. Quanta, in turn, argues that there is no reason to preclude exhaustion of method claims, and points out that both this Court and the Federal Circuit have applied exhaustion to method claims. It argues that any other rule would allow patent holders to avoid exhaustion entirely by inserting method claims in their patent specifications.
Quanta has the better of this argument. Nothing in this Court's approach to patent exhaustion supports LGE's argument that method patents cannot be exhausted. It is true that a patented method may not be sold in the same way as an article or device, but methods nonetheless may be "embodied" in a product, the sale of which exhausts patent rights. Our precedents do not differentiate transactions involving embodiments of patented methods or processes from those involving patented apparatuses or materials. To the contrary, this Court has repeatedly held that method patents were exhausted by the sale of an item that embodied the method. In Ethyl Gasoline Corp. v. United States, 309 U.S. 436, 446, 457, 60 S. Ct. 618, 84 L. Ed. 852 (1940), for example, the Court held that the sale of a motor fuel produced under one patent also exhausted the patent for a method of using the fuel in combustion motors.[4] Similarly, as previously described, Univis held that the sale of optical lens blanks that partially practiced a patent exhausted the method patents that were not completely practiced until the blanks were ground into lenses. 316 U.S., at 248-251, 62 S. Ct. 1088.
These cases rest on solid footing. Eliminating exhaustion for method patents would seriously undermine the exhaustion doctrine. Patentees seeking to avoid patent exhaustion could simply draft their patent claims to describe a method rather than an apparatus.[5] Apparatus and method *2118 claims "may approach each other so nearly that it will be difficult to distinguish the process from the function of the apparatus." United States ex rel. Steinmetz v. Allen, 192 U.S. 543, 559, 24 S. Ct. 416, 48 L. Ed. 555 (1904). By characterizing their claims as method instead of apparatus claims, or including a method claim for the machine's patented method of performing its task, a patent drafter could shield practically any patented item from exhaustion.
This case illustrates the danger of allowing such an end-run around exhaustion. On LGE's theory, although Intel is authorized to sell a completed computer system that practices the LGE Patents, any downstream purchasers of the system could nonetheless be liable for patent infringement. Such a result would violate the longstanding principle that, when a patented item is "once lawfully made and sold, there is no restriction on [its] use to be implied for the benefit of the patentee." Adams, 17 Wall., at 457, 21 L. Ed. 700. We therefore reject LGE's argument that method claims, as a category, are never exhaustible.
B
We next consider the extent to which a product must embody a patent in order to trigger exhaustion. Quanta argues that, although sales of an incomplete article do not necessarily exhaust the patent in that article, the sale of the microprocessors and chipsets exhausted LGE's patents in the same way the sale of the lens blanks exhausted the patents in Univis. Just as the lens blanks in Univis did not fully practice the patents at issue because they had not been ground into finished lenses, Quanta observes, the Intel Products cannot practice the LGE Patentsor indeed, function at alluntil they are combined with memory and buses in a computer system. If, as in Univis, patent rights are exhausted by the sale of the incomplete item, then LGE has no postsale right to require that the patents be practiced using only Intel parts. Quanta also argues that exhaustion doctrine will be a dead letter unless it is triggered by the sale of components that essentially, even if not completely, embody an invention. Otherwise, patent holders could authorize the sale of computers that are complete with the exception of one minor stepsay, inserting the microprocessor into a socket and extend their rights through each downstream purchaser all the way to the end user.
LGE, for its part, argues that Univis is inapplicable here for three reasons. First, it maintains that Univis should be limited to products that contain all the physical aspects needed to practice the patent. On that theory, the Intel Products cannot embody the patents because additional physical components are required before the patents can be practiced. Second, LGE asserts that in Univis there was no "patentable distinction" between the lens blanks and the patented finished lenses since they were both subject to the same patent. Brief for Respondent 14 (citing Univis, supra, at 248-252, 62 S. Ct. 1088). In contrast, it describes the Intel Products as "independent and distinct products" from the systems using the LGE Patents and subject to "independent patents." Brief for Respondent 13. Finally, LGE argues that Univis does not apply because the Intel Products are analogous to individual elements of a combination patent, *2119 and allowing sale of those components to exhaust the patent would impermissibly "ascrib[e] to one element of the patented combination the status of the patented invention in itself." Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U.S. 336, 344-345, 81 S. Ct. 599, 5 L. Ed. 2d 592 (1961).
We agree with Quanta that Univis governs this case. As the Court there explained, exhaustion was triggered by the sale of the lens blanks because their only reasonable and intended use was to practice the patent and because they "embodie[d] essential features of [the] patented invention." 316 U.S., at 249-251, 62 S. Ct. 1088. Each of those attributes is shared by the microprocessors and chipsets Intel sold to Quanta under the License Agreement.
First, Univis held that "the authorized sale of an article which is capable of use only in practicing the patent is a relinquishment of the patent monopoly with respect to the article sold." Id., at 249, 62 S. Ct. 1088. The lens blanks in Univis met this standard because they were "without utility until [they were] ground and polished as the finished lens of the patent." Ibid. Accordingly, "the only object of the sale [was] to enable the [finishing retailer] to grind and polish it for use as a lens by the prospective wearer." Ibid. Here, LGE has suggested no reasonable use for the Intel Products other than incorporating them into computer systems that practice the LGE Patents.[6] Nor can we can discern one: A microprocessor or chipset cannot function until it is connected to buses and memory. And here, as in Univis, the only apparent object of Intel's sales to Quanta was to permit Quanta to incorporate the Intel Products into computers that would practice the patents.
Second, the lens blanks in Univis "embodie[d] essential features of [the] patented invention." Id., at 250-251, 62 S. Ct. 1088. The essential, or inventive, feature of the Univis lens patents was the fusing together of different lens segments to create bi- and tri-focal lenses. The finishing process performed by the finishing and prescription retailers after the fusing was not unique. As the United States explained:
"The finishing licensees finish Univis lens blanks in precisely the same manner as they finish all other bifocal lens blanks. Indeed, appellees have never contended that their licensing system is supported by patents covering methods or processes relating to the finishing of lens blanks. Consequently, it appears that appellees perform all of the operations which contribute any claimed element of novelty to Univis lenses." Brief for United States in United States v. Univis Lens Co., O.T.1941, No. 855 et al., p. 10 (footnote and citations omitted).
While the Court assumed that the finishing process was covered by the patents, Univis, supra, at 248-249, 62 S. Ct. 1088, and the District Court found that it was necessary to make a working lens, United States v. Univis Lens Co., 41 F. Supp. 258, 262-263 (S.D.N.Y.1941), the grinding process *2120 was not central to the patents. That standard process was not included in detail in any of the patents and was not referred to at all in two of the patents. Those that did mention the finishing process treated it as incidental to the invention, noting, for example, that "[t]he blank is then ground in the usual manner," U.S. Patent No. 1,876,497, p. 2, or simply that the blank is "then ground and polished," U.S. Patent No. 1,632,208, p. 1, Tr. of Record in United States v. Univis Lens Co., O.T.1941, No. 855 et al., pp. 516, 498.
Like the Univis lens blanks, the Intel Products constitute a material part of the patented invention and all but completely practice the patent. Here, as in Univis, the incomplete article substantially embodies the patent because the only step necessary to practice the patent is the application of common processes or the addition of standard parts. Everything inventive about each patent is embodied in the Intel Products. They control access to main and cache memory, practicing the '641 and '379 patents by checking cache memory against main memory and comparing read and write requests. They also control priority of bus access by various other computer components under the '733 patent. Naturally, the Intel Products cannot carry out these functions unless they are attached to memory and buses, but those additions are standard components in the system, providing the material that enables the microprocessors and chipsets to function. The Intel Products were specifically designed to function only when memory or buses are attached; Quanta was not required to make any creative or inventive decision when it added those parts. Indeed, Quanta had no alternative but to follow Intel's specifications in incorporating the Intel Products into its computers because it did not know their internal structure, which Intel guards as a trade secret. Brief for Petitioners 3. Intel all but practiced the patent itself by designing its products to practice the patents, lacking only the addition of standard parts.
We are unpersuaded by LGE's attempts to distinguish Univis. First, there is no reason to distinguish the two cases on the ground that the articles in Univis required the removal of material to practice the patent while the Intel Products require the addition of components to practice the patent. LGE characterizes the lens blanks and lenses as sharing a "basic nature" by virtue of their physical similarity, while the Intel Products embody only some of the "patentably distinct elements and steps" involved in the LGE Patents. Brief for Respondent 26-27. But we think that the nature of the final step, rather than whether it consists of adding or deleting material, is the relevant characteristic. In each case, the final step to practice the patent is common and noninventive: grinding a lens to the customer's prescription, or connecting a microprocessor or chipset to buses or memory. The Intel Products embody the essential features of the LGE Patents because they carry out all the inventive processes when combined, according to their design, with standard components.
With regard to LGE's argument that exhaustion does not apply across patents, we agree on the general principle: The sale of a device that practices patent A does not, by virtue of practicing patent A, exhaust patent B. But if the device practices patent A while substantially embodying patent B, its relationship to patent A does not prevent exhaustion of patent B. For example, if the Univis lens blanks had been composed of shatter-resistant glass under patent A, the blanks would nonetheless have substantially embodied, and therefore exhausted, patent B for the finished lenses. This case is no different. *2121 While each Intel microprocessor and chipset practices thousands of individual patents, including some LGE patents not at issue in this case, the exhaustion analysis is not altered by the fact that more than one patent is practiced by the same product. The relevant consideration is whether the Intel Products that partially practice a patentby, for example, embodying its essential featuresexhaust that patent.
Finally, LGE's reliance on Aro is misplaced because that case dealt only with the question whether replacement of one part of a patented combination infringes the patent. First, the replacement question is not at issue here. Second, and more importantly, Aro is not squarely applicable to the exhaustion of patents like the LGE Patents that do not disclose a new combination of existing parts. Aro described combination patents as "cover[ing] only the totality of the elements in the claim [so] that no element, separately viewed, is within the grant." 365 U.S., at 344, 81 S. Ct. 599; see also Mercoid Corp. v. Mid-Continent Investment Co., 320 U.S. 661, 667-668, 64 S. Ct. 268, 88 L. Ed. 376 (1944) (noting that, in a combination patent, "the combination is the invention and it is distinct from any" of its elements). Aro's warning that no element can be viewed as central to or equivalent to the invention is specific to the context in which the combination itself is the only inventive aspect of the patent. In this case, the inventive part of the patent is not the fact that memory and buses are combined with a microprocessor or chipset; rather, it is included in the design of the Intel Products themselves and the way these products access the memory or bus.
C
Having concluded that the Intel Products embodied the patents, we next consider whether their sale to Quanta exhausted LGE's patent rights. Exhaustion is triggered only by a sale authorized by the patent holder. Univis, 316 U.S., at 249, 62 S. Ct. 1088.
LGE argues that there was no authorized sale here because the License Agreement does not permit Intel to sell its products for use in combination with non-Intel products to practice the LGE Patents. It cites General Talking Pictures Corp. v. Western Elec. Co., 304 U.S. 175, 58 S. Ct. 849, 82 L. Ed. 1273 (1938), and General Talking Pictures Corp. v. Western Elec. Co., 305 U.S. 124, 59 S. Ct. 116, 83 L. Ed. 81 (1938), in which the manufacturer sold patented amplifiers for commercial use, thereby breaching a license that limited the buyer to selling the amplifiers for private and home use. The Court held that exhaustion did not apply because the manufacturer had no authority to sell the amplifiers for commercial use, and the manufacturer "could not convey to petitioner what both knew it was not authorized to sell." General Talking Pictures, supra, at 181, 58 S. Ct. 849. LGE argues that the same principle applies here: Intel could not convey to Quanta what both knew it was not authorized to sell, i.e., the right to practice the patents with non-Intel parts.
LGE overlooks important aspects of the structure of the Intel-LGE transaction. Nothing in the License Agreement restricts Intel's right to sell its microprocessors and chipsets to purchasers who intend to combine them with non-Intel parts. It broadly permits Intel to "`make, use, [or] sell'" products free of LGE's patent claims. Brief for Petitioners 8 (quoting App. 154). To be sure, LGE did require Intel to give notice to its customers, including Quanta, that LGE had not licensed those customers to practice its patents. But neither party contends that Intel breached the agreement in that respect. Brief for Petitioners 9; Brief for Respondent 9. In any event, the provision requiring *2122 notice to Quanta appeared only in the Master Agreement, and LGE does not suggest that a breach of that agreement would constitute a breach of the License Agreement. Hence, Intel's authority to sell its products embodying the LGE Patents was not conditioned on the notice or on Quanta's decision to abide by LGE's directions in that notice.
LGE points out that the License Agreement specifically disclaimed any license to third parties to practice the patents by combining licensed products with other components. Brief for Petitioners 8. But the question whether third parties received implied licenses is irrelevant because Quanta asserts its right to practice the patents based not on implied license but on exhaustion. And exhaustion turns only on Intel's own license to sell products practicing the LGE Patents.
Alternatively, LGE invokes the principle that patent exhaustion does not apply to postsale restrictions on "making" an article. Brief for Respondent 43. But this is simply a rephrasing of its argument that combining the Intel Products with other components adds more than standard finishing to complete a patented article. As explained above, making a product that substantially embodies a patent is, for exhaustion purposes, no different from making the patented article itself. In other words, no further "making" results from the addition of standard partshere, the buses and memoryto a product that already substantially embodies the patent.
The License Agreement authorized Intel to sell products that practiced the LGE Patents. No conditions limited Intel's authority to sell products substantially embodying the patents. Because Intel was authorized to sell its products to Quanta, the doctrine of patent exhaustion prevents LGE from further asserting its patent rights with respect to the patents substantially embodied by those products.[7]
IV
The authorized sale of an article that substantially embodies a patent exhausts the patent holder's rights and prevents the patent holder from invoking patent law to control postsale use of the article. Here, LGE licensed Intel to practice any of its patents and to sell products practicing those patents. Intel's microprocessors and chipsets substantially embodied the LGE Patents because they had no reasonable noninfringing use and included all the inventive aspects of the patented methods. Nothing in the License Agreement limited Intel's ability to sell its products practicing the LGE Patents. Intel's authorized sale to Quanta thus took its products outside the scope of the patent monopoly, and as a result, LGE can no longer assert its patent rights against Quanta. Accordingly, the judgment of the Court of Appeals is reversed.
It is so ordered.
| For over 150 years this Court has applied the doctrine of patent exhaustion to limit the patent rights that survive the initial authorized sale of a patented item. In this case, we decide whether patent exhaustion applies to the sale of components of a patented system that must be combined with additional components in order to practice the patented methods. The Court of Appeals for the Federal Circuit held that the doctrine does not apply to method patents at all and, in the alternative, that it does not apply here because the sales were not authorized by the license agreement. We disagree on both scores. Because the exhaustion doctrine applies to method patents, and because the license authorizes the sale of components that substantially embody the patents in suit, the sale exhausted the patents. I Respondent LG Electronics, Inc. (LGE), purchased a portfolio of computer technology patents in 1999, including the three patents at issue here: U.S. Patent Nos. 4,939,641 ('641); 5,379,379 ('379); and 5,077,733 ('733) (collectively LGE Patents). The main functions of a computer system are carried out on a microprocessor, or central processing unit, which interprets program instructions, processes data, and controls other devices in the system. A set of wires, or bus, connects the microprocessor to a chipset, which transfers data between the microprocessor and other devices, including the keyboard, mouse, monitor, hard drive, memory, and disk drives. The data processed by the computer are stored principally in random access memory, also called main memory. Webster's New World Dictionary of Computer Terms 334, 451 (8th ed.2000). Frequently accessed data are generally stored in cache memory, which permits faster access than main memory and is often located on the microprocessor itself. When copies of data are stored in both the cache and main memory, problems may arise when one copy is changed but the other still contains the original "stale" version of the data. J. Handy, Cache Memory Book 124 (2d ed.1993). The '641 patent addresses this problem. It discloses a system for ensuring that the most current data are retrieved from main memory by monitoring data requests and updating main memory from the cache when stale data are requested. LG Electronics, (C.A.Fed.2006). The '379 patent relates to the coordination of requests to read from, and write to, main memory. Processing these requests in chronological order can slow down a system because read requests are faster to execute than write requests. Processing all read requests first ensures speedy access, but may result in the retrieval of outdated data if a read request for a certain piece of data is processed before an outstanding write request for the same data. The '379 patent discloses an efficient method of organizing read and write requests while maintaining accuracy by allowing the computer to execute only read requests until it needs data for which there is an outstanding write request. LG Electronics, No. C 01-02187 CW et al., Order Construing Disputed Terms and Phrases, p. 42 (ND Cal., Aug. 20, 2002). Upon receiving such a read request, the computer executes pending write requests first and only then returns to the read requests so that the most up-to-date data are retrieved. The '733 patent addresses the problem of managing the data traffic on a bus connecting two computer components, so *2114 that no one device monopolizes the bus. It allows multiple devices to share the bus, giving heavy users greater access. This patent describes methods that establish a rotating priority system under which each device alternately has priority access to the bus for a preset number of cycles and heavier users can maintain priority for more cycles without "hogging" the device indefinitely. LGE licensed a patent portfolio, including the LGE Patents, to Intel Corporation (Intel). The cross-licensing agreement (License Agreement) permits Intel to manufacture and sell microprocessors and chipsets that use the LGE Patents (the Intel Products). The License Agreement authorizes Intel to "`make, use, sell (directly or indirectly), offer to sell, import or otherwise dispose of'" its own products practicing the LGE Patents. Brief for Petitioners 8 (quoting App. 154).[1] Notwithstanding this broad language, the License Agreement contains some limitations. Relevant here, it stipulates that no license "`is granted by either party hereto to any third party for the combination by a third party of Licensed Products of either party with items, components, or the like acquired from sources other than a party hereto, or for the use, import, offer for sale or sale of such combination.'" Brief for Petitioners 8 (quoting App. 164). The License Agreement purports not to alter the usual rules of patent exhaustion, however, providing that, "`[n]otwithstanding anything to the contrary contained in this Agreement, the parties agree that nothing herein shall in any way limit or alter the effect of patent exhaustion that would otherwise apply when a party hereto sells any of its Licensed Products.'" Brief for Petitioners 8 (quoting App. 164). In a separate agreement (Master Agreement), Intel agreed to give written notice to its own customers informing them that, while it had obtained a broad license "`ensur[ing] that any Intel product that you purchase is licensed by LGE and thus does not infringe any patent held by LGE,'" the license "`does not extend, expressly or by implication, to any product that you make by combining an Intel product with any non-Intel product.'" Brief for Respondent 9 (emphasis deleted) (quoting App. 198). The Master Agreement also provides that "`a breach of this Agreement shall have no effect on and shall not be grounds for termination of the Patent License.'" Brief for Petitioners 9 (quoting App. 176). Petitioners, including Quanta Computer (collectively Quanta), are a group of computer manufacturers. Quanta purchased microprocessors and chipsets from Intel and received the notice required by the Master Agreement. Nonetheless, Quanta manufactured computers using Intel parts in combination with non-Intel memory and buses in ways that practice the LGE Patents. Quanta does not modify the Intel components and follows Intel's specifications to incorporate the parts into its own systems. LGE filed a complaint against Quanta, asserting that the combination of the Intel Products with non-Intel memory and buses infringed the LGE Patents. The District Court granted summary judgment to Quanta, holding that, for purposes of the patent exhaustion doctrine, the license LGE granted to Intel resulted in forfeiture of any potential infringement actions *2115 against legitimate purchasers of the Intel Products. LG Electronics, (N.D.Cal.2002). The court found that, although the Intel Products do not fully practice any of the patents at issue, they have no reasonable noninfringing use and therefore their authorized sale exhausted patent rights in the completed computers under United In a subsequent order limiting its summary judgment ruling, the court held that patent exhaustion applies only to apparatus or composition-of-matter claims that describe a physical object, and does not apply to process, or method, claims that describe operations to make or use a product. LG Electronics, (N.D.Cal.2003). Because each of the LGE Patents includes method claims, exhaustion did not apply. The Court of Appeals for the Federal Circuit affirmed in part and reversed in part. It agreed that the doctrine of patent exhaustion does not apply to method claims. In the alternative, it concluded that exhaustion did not apply because LGE did not license Intel to sell the Intel Products to Quanta for use in combination with non-Intel We granted certiorari, 551 U.S. II The longstanding doctrine of patent exhaustion provides that the initial authorized sale of a patented item terminates all patent rights to that item. This Court first applied the doctrine in 19th-century cases addressing patent extensions on the Woodworth planing machine. Purchasers of licenses to sell and use the machine for the duration of the original patent term sought to continue using the licenses through the extended term. The Court held that the extension of the patent term did not affect the rights already secured by purchasers who bought the item for use "in the ordinary pursuits of life." ; see also ; In the Court affirmed the dismissal of a patent holder's suit alleging that a licensee had violated postsale restrictions on where patented coffin-lids could be used. "[W]here a person ha[s] purchased a patented machine of the patentee or his assignee," the Court held, "this purchase carrie[s] with it the right to the use of that machine so long as it [is] capable of use." Although the Court permitted postsale restrictions on the use of a patented article in[2] that *2116 decision was short lived. In the Court refused to apply A.B. Dick to uphold price-fixing provisions in a patent license. See Bauer & Shortly thereafter, in Motion Picture Patents the Court explicitly overruled A.B. Dick. In that case, a patent holder attempted to limit purchasers' use of its film projectors to show only film made under a patent held by the same company. The Court noted the "increasing frequency" with which patent holders were using A.B. Dick-style licenses to limit the use of their products and thereby using the patents to secure market control of related, unpatented 516-517, Observing that "the primary purpose of our patent laws is not the creation of private fortunes for the owners of patents but is `to promote the progress of science and useful arts,'" (quoting U.S. Const., Art. I, 8, cl. 8), the Court held that "the scope of the grant which may be made to an inventor in a patent, pursuant to the [patent] statute, must be limited to the invention described in the claims of his patent." 243 U.S., Accordingly, it reiterated the rule that "the right to vend is exhausted by a single, unconditional sale, the article sold being thereby carried outside the monopoly of the patent law and rendered free of every restriction which the vendor may attempt to put upon it." This Court most recently discussed patent exhaustion in on which the District Court relied. Lens Company, the holder of patents on eyeglass lenses, licensed a purchaser to manufacture lens blanks[3] by fusing together different lens segments to create bi- and tri-focal lenses and to sell them to other licensees at agreed-upon rates. Wholesalers were licensed to grind the blanks into the patented finished lenses, which they would then sell to -licensed prescription retailers for resale at a fixed rate. Finishing retailers, after grinding the blanks into patented lenses, would sell the finished lenses to consumers at the same fixed rate. The United States sued under the Sherman Act, 15 U.S.C. 1, 3, 15, alleging unlawful restraints on trade. asserted its patent monopoly rights as a defense to the antitrust suit. The Court granted certiorari to determine whether ' patent monopoly survived the sale of the lens blanks by the licensed manufacturer and therefore shielded ' pricing scheme from the Sherman Act. The Court assumed that the patents containing claims for finished lenses were practiced in part by the wholesalers and finishing retailers who ground the blanks into lenses, and held that the sale of the lens blanks exhausted the patents on the finished lenses. -249, The Court explained that the lens blanks "embodi[ed] essential features of the patented device and [were] without utility until ground and polished as the finished lens of the patent." The Court noted that: "where one has sold an uncompleted article which, because it embodies essential features of his patented invention, is within the protection of his patent, and has destined the article to be finished by the purchaser in conformity to the patent, he has sold his invention so far as it *2117 is or may be embodied in that particular article." In sum, the Court concluded that the traditional bar on patent restrictions following the sale of an item applies when the item sufficiently embodies the patent even if it does not completely practice the patentsuch that its only and intended use is to be finished under the terms of the patent. With this history of the patent exhaustion doctrine in mind, we turn to the parties' arguments. III A LGE argues that the exhaustion doctrine is inapplicable here because it does not apply to method claims, which are contained in each of the LGE Patents. LGE reasons that, because method patents are linked not to a tangible article but to a process, they can never be exhausted through a sale. Rather, practicing the patentwhich occurs upon each use of an article embodying a method patentis permissible only to the extent rights are transferred in an assignment contract. Quanta, in turn, argues that there is no reason to preclude exhaustion of method claims, and points out that both this Court and the Federal Circuit have applied exhaustion to method claims. It argues that any other rule would allow patent holders to avoid exhaustion entirely by inserting method claims in their patent specifications. Quanta has the better of this argument. Nothing in this Court's approach to patent exhaustion supports LGE's argument that method patents cannot be exhausted. It is true that a patented method may not be sold in the same way as an article or device, but methods nonetheless may be "embodied" in a product, the sale of which exhausts patent rights. Our precedents do not differentiate transactions involving embodiments of patented methods or processes from those involving patented apparatuses or materials. To the contrary, this Court has repeatedly held that method patents were exhausted by the sale of an item that embodied the method. In Ethyl Gasoline for example, the Court held that the sale of a motor fuel produced under one patent also exhausted the patent for a method of using the fuel in combustion motors.[4] Similarly, as previously described, held that the sale of optical lens blanks that partially practiced a patent exhausted the method patents that were not completely practiced until the blanks were ground into lenses. -251, These cases rest on solid footing. Eliminating exhaustion for method patents would seriously undermine the exhaustion doctrine. Patentees seeking to avoid patent exhaustion could simply draft their patent claims to describe a method rather than an apparatus.[5] Apparatus and method *2118 claims "may approach each other so nearly that it will be difficult to distinguish the process from the function of the apparatus." United States ex rel. By characterizing their claims as method instead of apparatus claims, or including a method claim for the machine's patented method of performing its task, a patent drafter could shield practically any patented item from exhaustion. This case illustrates the danger of allowing such an end-run around exhaustion. On LGE's theory, although Intel is authorized to sell a completed computer system that practices the LGE Patents, any downstream purchasers of the system could nonetheless be liable for patent infringement. Such a result would violate the longstanding principle that, when a patented item is "once lawfully made and sold, there is no restriction on [its] use to be implied for the benefit of the patentee." We therefore reject LGE's argument that method claims, as a category, are never exhaustible. B We next consider the extent to which a product must embody a patent in order to trigger exhaustion. Quanta argues that, although sales of an incomplete article do not necessarily exhaust the patent in that article, the sale of the microprocessors and chipsets exhausted LGE's patents in the same way the sale of the lens blanks exhausted the patents in Just as the lens blanks in did not fully practice the patents at issue because they had not been ground into finished lenses, Quanta observes, the Intel Products cannot practice the LGE Patentsor indeed, function at alluntil they are combined with memory and buses in a computer system. If, as in patent rights are exhausted by the sale of the incomplete item, then LGE has no postsale right to require that the patents be practiced using only Intel parts. Quanta also argues that exhaustion doctrine will be a dead letter unless it is triggered by the sale of components that essentially, even if not completely, embody an invention. Otherwise, patent holders could authorize the sale of computers that are complete with the exception of one minor stepsay, inserting the microprocessor into a socket and extend their rights through each downstream purchaser all the way to the end user. LGE, for its part, argues that is inapplicable here for three reasons. First, it maintains that should be limited to products that contain all the physical aspects needed to practice the patent. On that theory, the Intel Products cannot embody the patents because additional physical components are required before the patents can be practiced. Second, LGE asserts that in there was no "patentable distinction" between the lens blanks and the patented finished lenses since they were both subject to the same patent. Brief for Respondent 14 (citing ). In contrast, it describes the Intel Products as "independent and distinct products" from the systems using the LGE Patents and subject to "independent patents." Brief for Respondent 13. Finally, LGE argues that does not apply because the Intel Products are analogous to individual elements of a combination patent, *2119 and allowing sale of those components to exhaust the patent would impermissibly "ascrib[e] to one element of the patented combination the status of the patented invention in itself." Aro Mfg. We agree with Quanta that governs this case. As the Court there explained, exhaustion was triggered by the sale of the lens blanks because their only reasonable and intended use was to practice the patent and because they "embodie[d] essential features of [the] patented invention." 316 U.S., -251, Each of those attributes is shared by the microprocessors and chipsets Intel sold to Quanta under the License Agreement. First, held that "the authorized sale of an article which is capable of use only in practicing the patent is a relinquishment of the patent monopoly with respect to the article sold." The lens blanks in met this standard because they were "without utility until [they were] ground and polished as the finished lens of the patent." Accordingly, "the only object of the sale [was] to enable the [finishing retailer] to grind and polish it for use as a lens by the prospective wearer." Here, LGE has suggested no reasonable use for the Intel Products other than incorporating them into computer systems that practice the LGE Patents.[6] Nor can we can discern one: A microprocessor or chipset cannot function until it is connected to buses and memory. And here, as in the only apparent object of Intel's sales to Quanta was to permit Quanta to incorporate the Intel Products into computers that would practice the patents. Second, the lens blanks in "embodie[d] essential features of [the] patented invention." The essential, or inventive, feature of the lens patents was the fusing together of different lens segments to create bi- and tri-focal lenses. The finishing process performed by the finishing and prescription retailers after the fusing was not unique. As the United States explained: "The finishing licensees finish lens blanks in precisely the same manner as they finish all other bifocal lens blanks. Indeed, appellees have never contended that their licensing system is supported by patents covering methods or processes relating to the finishing of lens blanks. Consequently, it appears that appellees perform all of the operations which contribute any claimed element of novelty to lenses." Brief for United States in United O.T.1941, No. 855 et al., p. 10 (footnote and citations omitted). While the Court assumed that the finishing process was covered by the patents, and the District Court found that it was necessary to make a working lens, United (S.D.N.Y.1941), the grinding process *2120 was not central to the patents. That standard process was not included in detail in any of the patents and was not referred to at all in two of the patents. Those that did mention the finishing process treated it as incidental to the invention, noting, for example, that "[t]he blank is then ground in the usual manner," p. 2, or simply that the blank is "then ground and polished," p. 1, Tr. of Record in United O.T.1941, No. 855 et al., pp. 516, 498. Like the lens blanks, the Intel Products constitute a material part of the patented invention and all but completely practice the patent. Here, as in the incomplete article substantially embodies the patent because the only step necessary to practice the patent is the application of common processes or the addition of standard parts. Everything inventive about each patent is embodied in the Intel Products. They control access to main and cache memory, practicing the '641 and '379 patents by checking cache memory against main memory and comparing read and write requests. They also control priority of bus access by various other computer components under the '733 patent. Naturally, the Intel Products cannot carry out these functions unless they are attached to memory and buses, but those additions are standard components in the system, providing the material that enables the microprocessors and chipsets to function. The Intel Products were specifically designed to function only when memory or buses are attached; Quanta was not required to make any creative or inventive decision when it added those parts. Indeed, Quanta had no alternative but to follow Intel's specifications in incorporating the Intel Products into its computers because it did not know their internal structure, which Intel guards as a trade secret. Brief for Petitioners 3. Intel all but practiced the patent itself by designing its products to practice the patents, lacking only the addition of standard parts. We are unpersuaded by LGE's attempts to distinguish First, there is no reason to distinguish the two cases on the ground that the articles in required the removal of material to practice the patent while the Intel Products require the addition of components to practice the patent. LGE characterizes the lens blanks and lenses as sharing a "basic nature" by virtue of their physical similarity, while the Intel Products embody only some of the "patentably distinct elements and steps" involved in the LGE Patents. Brief for Respondent 26-27. But we think that the nature of the final step, rather than whether it consists of adding or deleting material, is the relevant characteristic. In each case, the final step to practice the patent is common and noninventive: grinding a lens to the customer's prescription, or connecting a microprocessor or chipset to buses or memory. The Intel Products embody the essential features of the LGE Patents because they carry out all the inventive processes when combined, according to their design, with standard components. With regard to LGE's argument that exhaustion does not apply across patents, we agree on the general principle: The sale of a device that practices patent A does not, by virtue of practicing patent A, exhaust patent B. But if the device practices patent A while substantially embodying patent B, its relationship to patent A does not prevent exhaustion of patent B. For example, if the lens blanks had been composed of shatter-resistant glass under patent A, the blanks would nonetheless have substantially embodied, and therefore exhausted, patent B for the finished lenses. This case is no different. *2121 While each Intel microprocessor and chipset practices thousands of individual patents, including some LGE patents not at issue in this case, the exhaustion analysis is not altered by the fact that more than one patent is practiced by the same product. The relevant consideration is whether the Intel Products that partially practice a patentby, for example, embodying its essential featuresexhaust that patent. Finally, LGE's reliance on Aro is misplaced because that case dealt only with the question whether replacement of one part of a patented combination infringes the patent. First, the replacement question is not at issue here. Second, and more importantly, Aro is not squarely applicable to the exhaustion of patents like the LGE Patents that do not disclose a new combination of existing parts. Aro described combination patents as "cover[ing] only the totality of the elements in the claim [so] that no element, separately viewed, is within the grant." Aro's warning that no element can be viewed as central to or equivalent to the invention is specific to the context in which the combination itself is the only inventive aspect of the patent. In this case, the inventive part of the patent is not the fact that memory and buses are combined with a microprocessor or chipset; rather, it is included in the design of the Intel Products themselves and the way these products access the memory or bus. C Having concluded that the Intel Products embodied the patents, we next consider whether their sale to Quanta exhausted LGE's patent rights. Exhaustion is triggered only by a sale authorized by the patent holder. 316 U.S., LGE argues that there was no authorized sale here because the License Agreement does not permit Intel to sell its products for use in combination with non-Intel products to practice the LGE Patents. It cites General Talking Pictures and General Talking Pictures in which the manufacturer sold patented amplifiers for commercial use, thereby breaching a license that limited the buyer to selling the amplifiers for private and home use. The Court held that exhaustion did not apply because the manufacturer had no authority to sell the amplifiers for commercial use, and the manufacturer "could not convey to petitioner what both knew it was not authorized to sell." General Talking Pictures, LGE argues that the same principle applies here: Intel could not convey to Quanta what both knew it was not authorized to sell, i.e., the right to practice the patents with non-Intel parts. LGE overlooks important aspects of the structure of the Intel-LGE transaction. Nothing in the License Agreement restricts Intel's right to sell its microprocessors and chipsets to purchasers who intend to combine them with non-Intel parts. It broadly permits Intel to "`make, use, [or] sell'" products free of LGE's patent claims. Brief for Petitioners 8 (quoting App. 154). To be sure, LGE did require Intel to give notice to its customers, including Quanta, that LGE had not licensed those customers to practice its patents. But neither party contends that Intel breached the agreement in that respect. Brief for Petitioners 9; Brief for Respondent 9. In any event, the provision requiring *2122 notice to Quanta appeared only in the Master Agreement, and LGE does not suggest that a breach of that agreement would constitute a breach of the License Agreement. Hence, Intel's authority to sell its products embodying the LGE Patents was not conditioned on the notice or on Quanta's decision to abide by LGE's directions in that notice. LGE points out that the License Agreement specifically disclaimed any license to third parties to practice the patents by combining licensed products with other components. Brief for Petitioners 8. But the question whether third parties received implied licenses is irrelevant because Quanta asserts its right to practice the patents based not on implied license but on exhaustion. And exhaustion turns only on Intel's own license to sell products practicing the LGE Patents. Alternatively, LGE invokes the principle that patent exhaustion does not apply to postsale restrictions on "making" an article. Brief for Respondent 43. But this is simply a rephrasing of its argument that combining the Intel Products with other components adds more than standard finishing to complete a patented article. As explained above, making a product that substantially embodies a patent is, for exhaustion purposes, no different from making the patented article itself. In other words, no further "making" results from the addition of standard partshere, the buses and memoryto a product that already substantially embodies the patent. The License Agreement authorized Intel to sell products that practiced the LGE Patents. No conditions limited Intel's authority to sell products substantially embodying the patents. Because Intel was authorized to sell its products to Quanta, the doctrine of patent exhaustion prevents LGE from further asserting its patent rights with respect to the patents substantially embodied by those [7] IV The authorized sale of an article that substantially embodies a patent exhausts the patent holder's rights and prevents the patent holder from invoking patent law to control postsale use of the article. Here, LGE licensed Intel to practice any of its patents and to sell products practicing those patents. Intel's microprocessors and chipsets substantially embodied the LGE Patents because they had no reasonable noninfringing use and included all the inventive aspects of the patented methods. Nothing in the License Agreement limited Intel's ability to sell its products practicing the LGE Patents. Intel's authorized sale to Quanta thus took its products outside the scope of the patent monopoly, and as a result, LGE can no longer assert its patent rights against Quanta. Accordingly, the judgment of the Court of Appeals is reversed. It is so ordered. |
Justice Stevens | majority | false | Franchise Tax Board of California v. USPS | 1984-06-11T00:00:00 | null | https://www.courtlistener.com/opinion/111209/franchise-tax-board-of-california-v-usps/ | https://www.courtlistener.com/api/rest/v3/clusters/111209/ | 1,984 | 1983-122 | 1 | 9 | 0 | Appellant, the Franchise Tax Board of California, determined that four employees of appellee United States Postal Service were delinquent in the payment of their state income taxes. The Board served process on the Postal Service directing it to withhold the amounts of the delinquencies from the employees' wages, pursuant to § 18817 of the California Revenue and Taxation Code, which authorizes the Board to *514 require any employer to withhold delinquent taxes from an employee's salary and transfer those funds to the Board.[1] The question presented is whether the Postal Service was obligated to honor these "orders to withhold."
I
When the Postal Service refused to comply with the four orders to withhold, the Board filed this action in the United States District Court for the Central District of California asserting that the Service was liable under the Revenue and Taxation Code for failing to honor the orders,[2] and invoking federal jurisdiction pursuant to 39 U.S. C. § 409(a) and 28 U.S. C. § 1339.[3] The District Court entered summary judgment for the Postal Service. It held that 5 U.S. C. § 5517, which authorized the agreement that California and the United States had made regarding the withholding of state income taxes from the pay of federal employees, applies only to withholding of anticipated tax liabilities and not to *515 delinquent liabilities.[4] The Court of Appeals affirmed, agreeing that 5 U.S. C. § 5517 excused the Service from complying with the orders. Employment Development Department v. United States Postal Service, 698 F.2d 1029 (CA9 1983).[5] The Court of Appeals rejected the Board's argument that § 5517 did not prohibit issuance of the orders, and also rejected the argument that the provision in 39 U.S. C. § 401(1) declaring that the Postal Service may "sue and be sued in its official name" had waived any sovereign immunity that the Service might possess.[6] This appeal followed.[7]
In this Court, the Postal Service does not argue that 5 U.S. C. § 5517 and the agreement pursuant thereto between the United States and California prohibit the issuance of an order to withhold against the Postal Service with respect to delinquent tax liabilities of its employees.[8] To the contrary, *516 the Postal Service expressly concedes that it is amenable to judicial process and could be required to honor a garnishment order requiring it to withhold the salary of a federal employee in order to satisfy a delinquent tax liability if issued by a state court.[9] Instead, the Postal Service contends that although it must obey a judicial order, it retains sovereign immunity with respect to state administrative tax levies. It argues that while the provision that the Postal Service can "sue and be sued in its official name" waives immunity from suit, it does not apply to administrative proceedings.
II
The Board does not dispute the proposition that, unless waived, sovereign immunity prevents the creditor of a federal *517 employee from collecting a debt through a judicial order requiring the United States to garnishee the employee's salary. See Buchanan v. Alexander, 4 How. 20 (1845). Rather, it places its primary reliance on 39 U.S. C. § 401(1), which indicates that the Postal Service may "sue and be sued." Thus the question in this case is whether this statutory waiver of sovereign immunity extends to the Board's orders to withhold.
This Court construed a statute providing that an agency created by Congress the Federal Housing Authority was empowered "to sue and be sued," in FHA v. Burr, 309 U.S. 242 (1940). In Burr the question presented was whether the agency had to honor a garnishment order issued by a state court. The Court began by observing: "Since consent to `sue and be sued' has been given by Congress, the problem here merely involves a determination of whether or not garnishment comes within the scope of that authorization." Id., at 244. It continued:
"[W]e start from the premise that such waivers by Congress of governmental immunity in case of such federal instrumentalities should be liberally construed. This policy is in line with the current disfavor of the doctrine of governmental immunity from suit, as evidenced by the increasing tendency of Congress to waive the immunity where federal governmental corporations are concerned.. . . Hence, when Congress establishes such an agency, authorizes it to engage in commercial and business transactions with the public, and permits it to `sue and be sued,' it cannot be lightly assumed that restrictions on that authority are to be implied. Rather if the general authority to `sue and be sued' is to be delimited by implied exceptions, it must be clearly shown that certain types of suits are not consistent with the statutory or constitutional scheme, that an implied restriction of the general authority is necessary to avoid grave interference with the performance of a governmental function, or that for other reasons it was plainly the purpose of *518 Congress to use the `sue and be sued' clause in a narrow sense. In the absence of such showing, it must be presumed that when Congress launched a governmental agency into the commercial world and endowed it with authority to `sue or be sued,' that agency is not less amenable to judicial process than a private enterprise under like circumstances would be." Id., at 245 (footnote omitted).[10]
The Court then explained why garnishment orders fell within the scope of the statutory waiver of sovereign immunity:
"Clearly the words `sue and be sued' in their normal connotation embrace all civil process incident to the commencement or continuance of legal proceedings. Garnishment and attachment commonly are part and parcel of the process, provided by statute, for the collection of debt. . . . [H]owever it may be denominated, whether legal or equitable, and whenever it may be available, whether prior to or after final judgment, garnishment is *519 a well-known remedy available to suitors. To say that Congress did not intend to include such civil process in the words `sue and be sued' would in general deprive suits of some of their efficacy." Id., at 245-246 (footnotes and citation omitted).
If anything, the waiver of sovereign immunity is broader here than it was in Burr. In passing the Postal Reorganization Act of 1970, 84 Stat. 719, Congress not only indicated that the Postal Service could "sue and be sued," 39 U.S. C. § 401(1), but also that it had the power "to settle and compromise claims by or against it," § 401(8), and that "[t]he provisions of chapter 171 and all other provisions of title 28 relating to tort claims shall apply to tort claims arising out of activities of the Postal Service." § 409(c).[11] Neither of these provisions would have been necessary had Congress intended to preserve sovereign immunity with respect to the Postal Service.[12] Congress also indicated that it wished the *520 Postal Service to be run more like a business than had its predecessor, the Post Office Department.[13]
Here, the Board has employed the same "well-known" remedy that was held to be within the scope of a sue-and-be-sued clause in Burr. Moreover, as was true of the agency involved in Burr, Congress has "launched [the Postal Service] into the commercial world"; hence under Burr not only must we liberally construe the sue-and-be-sued clause, but also we must presume that the Service's liability is the same as that of any other business. No showing has been made to overcome that presumption. Since an order to withhold cannot issue unless the Postal Service owes the employee wages, the Service is nothing but a stakeholder; the order to withhold has precisely the same effect on its ability to operate efficiently as it does on that of any other employer subject to the California statute. It creates no greater inconvenience than did the garnishment order that this Court held could issue against a federal agency in Burr.[14] Indeed, the Board's *521 order to withhold contains the same direction as did the writ of garnishment served on the FHA in Burr.
The Postal Service attempts to distinguish Burr by observing that the waiver of sovereign immunity in § 401(1) is limited to cases in which it has been "sued," and then arguing that because the process that has issued here is that of an administrative agency rather than a court, the Service has not been "sued" within the meaning of § 401(1). This crabbed construction of the statute overlooks our admonition that waiver of sovereign immunity is accomplished not by "a ritualistic formula"; rather intent to waive immunity and the scope of such a waiver can only be ascertained by reference to underlying congressional policy. Keifer & Keifer v. Reconstruction Finance Corp., 306 U.S. 381, 389 (1939).[15] In this *522 case, at the level of policy and practicality it is illogical to conclude that Congress would have differentiated between process issued by the Board and that of a court, for even if a court issued the orders to withhold, neither the Postal Service nor its employees would be in a materially different position.
The operation of California's tax collection process makes it clear that there is no meaningful difference between an order to withhold issued by the Board and a garnishment order issued by a court. Under state law an assessment that has been validly made against a taxpayer[16] operates to impose an absolute liability for the tax that may not be contested except in an action seeking refund of amounts already paid. Indeed state law is unequivocal in requiring employers to honor orders to withhold no defense is permitted.[17] Thus, a California *523 tax assessment, like a federal tax assessment, operates in a way that is functionally indistinguishable from the judgment of a court of law; it creates an absolute legal obligation to make payment by a date certain:
"Once the tax is assessed the taxpayer will owe the sovereign the amount when the date fixed by law for payment arrives. Default in meeting the obligations calls for some procedure whereby payment can be enforced. The statute might remit the Government to an action at law wherein the taxpayer could offer such defense as he had. A judgment against him might be collected by the levy of an execution. But taxes are the life-blood of government, and their prompt and certain availability an imperious need. Time out of mind, therefore, the sovereign has resorted to more drastic means of collection. The assessment is given the force of a judgment, and if the amount assessed is not paid when due, administrative officials may seize the debtor's property to satisfy the debt." Bull v. United States, 295 U.S. 247, 259-260 (1935).[18]
Thus, in operation and effect the Board's orders to withhold are identical to the judgment of a court. They give rise to a binding legal obligation to pay the assessed amounts; the taxpayer may no more dispute this liability than the liability under any other judgment. Neither the Postal Service nor its employees would obtain any additional protections from a requirement that such orders be issued by a court, since the liability cannot be contested until after the tax has been paid *524 and a refund action brought.[19] At the same time, construing the statute to require the issuance of judicial process before the Postal Service need honor an order to withhold would create unwarranted disruption of the State's machinery for collection of delinquent taxes,[20] while simultaneously depriving the orders of "some of their efficacy" a result inconsistent with Burr.
There is thus no reason to believe that Congress intended to impose a meaningless procedural requirement that an order to withhold be issued by a court. To distinguish between administrative and judicial process would be to take an approach to sovereign immunity that this Court rejected more than 40 years ago "to impute to Congress a desire for incoherence in a body of affiliated enactments and for drastic legal differentiation where policy justifies none." Keifer & Keifer, 306 U. S., at 394.[21] In cases of this kind, we believe *525 Congress intended the Postal Service to be treated similarly to other self-sustaining commercial ventures. Accordingly, we hold that when administrative process of the type employed by the Board issues against the Postal Service, it has been "sued" within the meaning of § 401(1), and must respond to that process.[22]
The judgment of the Court of Appeals is reversed, and the case is remanded to that court for further proceedings consistent with this opinion.
It is so ordered.
| Appellant, the Franchise Tax Board of California, determined that four employees of appellee United States Postal Service were delinquent in the payment of their state income taxes. The Board served process on the Postal Service directing it to withhold the amounts of the delinquencies from the employees' wages, pursuant to 18817 of the California Revenue and Taxation Code, which authorizes the Board to *514 require any employer to withhold delinquent taxes from an employee's salary and transfer those funds to the Board.[1] The question presented is whether the Postal Service was obligated to honor these "orders to withhold." I When the Postal Service refused to comply with the four orders to withhold, the Board filed this action in the United States District Court for the Central District of California asserting that the Service was liable under the Revenue and Taxation Code for failing to honor the orders,[2] and invoking federal jurisdiction pursuant to 39 U.S. C. 409(a) and 28 U.S. C. 1339.[3] The District Court entered summary judgment for the Postal Service. It held that 5 U.S. C. 5517, which authorized the agreement that California and the United States had made regarding the withholding of state income taxes from the pay of federal employees, applies only to withholding of anticipated tax liabilities and not to *515 delinquent liabilities.[4] The Court of Appeals affirmed, agreeing that 5 U.S. C. 5517 excused the Service from complying with the orders. Employment Development[5] The Court of Appeals rejected the Board's argument that 5517 did not prohibit issuance of the orders, and also rejected the argument that the provision in 39 U.S. C. 401(1) declaring that the Postal Service may "sue and be sued in its official name" had waived any sovereign immunity that the Service might possess.[6] This appeal followed.[7] In this Court, the Postal Service does not argue that 5 U.S. C. 5517 and the agreement pursuant thereto between the United States and California prohibit the issuance of an order to withhold against the Postal Service with respect to delinquent tax liabilities of its employees.[8] To the contrary, *516 the Postal Service expressly concedes that it is amenable to judicial process and could be required to honor a garnishment order requiring it to withhold the salary of a federal employee in order to satisfy a delinquent tax liability if issued by a state court.[9] Instead, the Postal Service contends that although it must obey a judicial order, it retains sovereign immunity with respect to state administrative tax levies. It argues that while the provision that the Postal Service can "sue and be sued in its official name" waives immunity from suit, it does not apply to administrative proceedings. II The Board does not dispute the proposition that, unless waived, sovereign immunity prevents the creditor of a federal *517 employee from collecting a debt through a judicial order requiring the United States to garnishee the employee's salary. See Rather, it places its primary reliance on 39 U.S. C. 401(1), which indicates that the Postal Service may "sue and be sued." Thus the question in this case is whether this statutory waiver of sovereign immunity extends to the Board's orders to withhold. This Court construed a statute providing that an agency created by Congress the Federal Housing Authority was empowered "to sue and be sued," in In Burr the question presented was whether the agency had to honor a garnishment order issued by a state court. The Court began by observing: "Since consent to `sue and be sued' has been given by Congress, the problem here merely involves a determination of whether or not garnishment comes within the scope of that authorization." It continued: "[W]e start from the premise that such waivers by Congress of governmental immunity in case of such federal instrumentalities should be liberally construed. This policy is in line with the current disfavor of the doctrine of governmental immunity from suit, as evidenced by the increasing tendency of Congress to waive the immunity where federal governmental corporations are concerned. Hence, when Congress establishes such an agency, authorizes it to engage in commercial and business transactions with the public, and permits it to `sue and be sued,' it cannot be lightly assumed that restrictions on that authority are to be implied. Rather if the general authority to `sue and be sued' is to be delimited by implied exceptions, it must be clearly shown that certain types of suits are not consistent with the statutory or constitutional scheme, that an implied restriction of the general authority is necessary to avoid grave interference with the performance of a governmental function, or that for other reasons it was plainly the purpose of *518 Congress to use the `sue and be sued' clause in a narrow sense. In the absence of such showing, it must be presumed that when Congress launched a governmental agency into the commercial world and endowed it with authority to `sue or be sued,' that agency is not less amenable to judicial process than a private enterprise under like circumstances would be."[10] The Court then explained why garnishment orders fell within the scope of the statutory waiver of sovereign immunity: "Clearly the words `sue and be sued' in their normal connotation embrace all civil process incident to the commencement or continuance of legal proceedings. Garnishment and attachment commonly are part and parcel of the process, provided by statute, for the collection of debt. [H]owever it may be denominated, whether legal or equitable, and whenever it may be available, whether prior to or after final judgment, garnishment is *519 a well-known remedy available to suitors. To say that Congress did not intend to include such civil process in the words `sue and be sued' would in general deprive suits of some of their efficacy." -246 If anything, the waiver of sovereign immunity is broader here than it was in Burr. In passing the Postal Reorganization Act of 1970, Congress not only indicated that the Postal Service could "sue and be sued," 39 U.S. C. 401(1), but also that it had the power "to settle and compromise claims by or against it," 401(8), and that "[t]he provisions of chapter 171 and all other provisions of title 28 relating to tort claims shall apply to tort claims arising out of activities of the Postal Service." 409(c).[11] Neither of these provisions would have been necessary had Congress intended to preserve sovereign immunity with respect to the Postal Service.[12] Congress also indicated that it wished the *520 Postal Service to be run more like a business than had its predecessor, the Post Office Department.[13] Here, the Board has employed the same "well-known" remedy that was held to be within the scope of a sue-and-be-sued clause in Burr. Moreover, as was true of the agency involved in Burr, Congress has "launched [the Postal Service] into the commercial world"; hence under Burr not only must we liberally construe the sue-and-be-sued clause, but also we must presume that the Service's liability is the same as that of any other business. No showing has been made to overcome that presumption. Since an order to withhold cannot issue unless the Postal Service owes the employee wages, the Service is nothing but a stakeholder; the order to withhold has precisely the same effect on its ability to operate efficiently as it does on that of any other employer subject to the California statute. It creates no greater inconvenience than did the garnishment order that this Court held could issue against a federal agency in Burr.[14] Indeed, the Board's *521 order to withhold contains the same direction as did the writ of garnishment served on the FHA in Burr. The Postal Service attempts to distinguish Burr by observing that the waiver of sovereign immunity in 401(1) is limited to cases in which it has been "sued," and then arguing that because the process that has issued here is that of an administrative agency rather than a court, the Service has not been "sued" within the meaning of 401(1). This crabbed construction of the statute overlooks our admonition that waiver of sovereign immunity is accomplished not by "a ritualistic formula"; rather intent to waive immunity and the scope of such a waiver can only be ascertained by reference to underlying congressional policy. Keifer &[15] In this *522 case, at the level of policy and practicality it is illogical to conclude that Congress would have differentiated between process issued by the Board and that of a court, for even if a court issued the orders to withhold, neither the Postal Service nor its employees would be in a materially different position. The operation of California's tax collection process makes it clear that there is no meaningful difference between an order to withhold issued by the Board and a garnishment order issued by a court. Under state law an assessment that has been validly made against a taxpayer[16] operates to impose an absolute liability for the tax that may not be contested except in an action seeking refund of amounts already paid. Indeed state law is unequivocal in requiring employers to honor orders to withhold no defense is permitted.[17] Thus, a California *523 tax assessment, like a federal tax assessment, operates in a way that is functionally indistinguishable from the judgment of a court of law; it creates an absolute legal obligation to make payment by a date certain: "Once the tax is assessed the taxpayer will owe the sovereign the amount when the date fixed by law for payment arrives. Default in meeting the obligations calls for some procedure whereby payment can be enforced. The statute might remit the Government to an action at law wherein the taxpayer could offer such defense as he had. A judgment against him might be collected by the levy of an execution. But taxes are the life-blood of government, and their prompt and certain availability an imperious need. Time out of mind, therefore, the sovereign has resorted to more drastic means of collection. The assessment is given the force of a judgment, and if the amount assessed is not paid when due, administrative officials may seize the debtor's property to satisfy the debt."[18] Thus, in operation and effect the Board's orders to withhold are identical to the judgment of a court. They give rise to a binding legal obligation to pay the assessed amounts; the taxpayer may no more dispute this liability than the liability under any other judgment. Neither the Postal Service nor its employees would obtain any additional protections from a requirement that such orders be issued by a court, since the liability cannot be contested until after the tax has been paid *524 and a refund action brought.[19] At the same time, construing the statute to require the issuance of judicial process before the Postal Service need honor an order to withhold would create unwarranted disruption of the State's machinery for collection of delinquent taxes,[20] while simultaneously depriving the orders of "some of their efficacy" a result inconsistent with Burr. There is thus no reason to believe that Congress intended to impose a meaningless procedural requirement that an order to withhold be issued by a court. To distinguish between administrative and judicial process would be to take an approach to sovereign immunity that this Court rejected more than 40 years ago "to impute to Congress a desire for incoherence in a body of affiliated enactments and for drastic legal differentiation where policy justifies none." Keifer & Keifer,[21] In cases of this kind, we believe *525 Congress intended the Postal Service to be treated similarly to other self-sustaining commercial ventures. Accordingly, we hold that when administrative process of the type employed by the Board issues against the Postal Service, it has been "sued" within the meaning of 401(1), and must respond to that process.[22] The judgment of the Court of Appeals is reversed, and the case is remanded to that court for further proceedings consistent with this opinion. It is so ordered. |
Justice Kennedy | majority | false | Edenfield v. Fane | 1993-04-26T00:00:00 | null | https://www.courtlistener.com/opinion/112850/edenfield-v-fane/ | https://www.courtlistener.com/api/rest/v3/clusters/112850/ | 1,993 | 1992-062 | 2 | 8 | 1 | In previous cases we have considered the constitutionality of state laws prohibiting lawyers from engaging in direct, personal solicitation of prospective clients. See Ohralik v. Ohio State Bar Assn., 436 U.S. 447 (1978); In re Primus, 436 U.S. 412 (1978). In the case now before us, we consider a solicitation ban applicable to certified public accountants (CPA's) enacted by the State of Florida. We hold that, as applied to CPA solicitation in the business context, Florida's prohibition is inconsistent with the free speech guarantees of the First and Fourteenth Amendments.
I
Respondent Scott Fane is a CPA licensed to practice in the State of Florida by the Florida Board of Accountancy (Board). Before moving to Florida in 1985, Fane had his own accounting CPA practice in New Jersey, specializing in providing tax advice to small and medium-sized businesses. He often obtained business clients by making unsolicited telephone calls to their executives and arranging meetings to explain his services and expertise. This direct, personal, uninvited solicitation was permitted under New Jersey law.
When he moved to Florida, Fane wished to build a practice similar to his solo practice in New Jersey but was unable to do so because the Board of Accountancy had a comprehensive rule prohibiting CPA's from engaging in the direct, personal *764 solicitation he had found most effective in the past. The Board's rules provide that a CPA "shall not by any direct, in-person, uninvited solicitation solicit an engagement to perform public accounting services . . . where the engagement would be for a person or entity not already a client of [the CPA], unless such person or entity has invited such a communication." Fla. Admin. Code § 21A-24.002(2)(c) (1992). "[D]irect, in-person, uninvited solicitation" means "any communication which directly or implicitly requests an immediate oral response from the recipient," which, under the Board's rules, includes all "[u]ninvited in-person visits or conversations or telephone calls to a specific potential client." § 21A-24.002(3).
The rule, according to Fane's uncontradicted submissions, presented a serious obstacle, because most businesses are willing to rely for advice on the accountants or CPA's already serving them. In Fane's experience, persuading a business to sever its existing accounting relations or alter them to include a new CPA on particular assignments requires the new CPA to contact the business and explain the advantages of a change. This entails a detailed discussion of the client's needs and the CPA's expertise, services and fees. See Affidavit of Scott Fane ¶¶ 7, 11, App. 11, 15.
Fane sued the Board in the United States District Court for the Northern District of Florida, seeking declaratory and injunctive relief on the ground that the Board's antisolicitation rule violated the First and Fourteenth Amendments. Fane alleged that but for the prohibition he would seek clients through personal solicitation and would offer fees below prevailing rates. Complaint ¶¶ 9-11, App. 3-4.
In response to Fane's submissions, the Board relied on the affidavit of Louis Dooner, one of its former chairmen. Dooner concluded that the solicitation ban was necessary to preserve the independence of CPA's performing the attest function, which involves the rendering of opinions on a firm's financial statements. His premise was that a CPA who solicits *765 clients "is obviously in need of business and may be willing to bend the rules." App. 23. In Dooner's view, "[i]f [a CPA] has solicited the client he will be beholden to him." Id., at 19. Dooner also suggested that the ban was needed to prevent "overreaching and vexatious conduct by the CPA." Id., at 23.
The District Court gave summary judgment to Fane and enjoined enforcement of the rule "as it is applied to CPA's who seek clients through in-person, direct, uninvited solicitation in the business context." Civ. Case No. 88-40264MNP (ND Fla., Sept. 13, 1990), App. 88. A divided panel of the Court of Appeals for the Eleventh Circuit affirmed. 945 F.2d 1514 (1991).
We granted certiorari, 504 U.S. 940 (1992), and now affirm.
II
In soliciting potential clients, Fane seeks to communicate no more than truthful, nondeceptive information proposing a lawful commercial transaction. We need not parse Fane's proposed communications to see if some parts are entitled to greater protection than the solicitation itself. This case comes to us testing the solicitation, nothing more. That is what the State prohibits and Fane proposes.
Whatever ambiguities may exist at the margins of the category of commercial speech, see, e. g., Pittsburgh Press Co. v. Pittsburgh Comm'n on Human Relations, 413 U.S. 376, 384-388 (1973), it is clear that this type of personal solicitation is commercial expression to which the protections of the First Amendment apply. E. g., Virginia State Bd. of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 762 (1976). While we did uphold a ban on in-person solicitation by lawyers in Ohralik v. Ohio State Bar Assn., 436 U.S. 447 (1978), that opinion did not hold that all personal solicitation is without First Amendment protection. See id., at 457. There are, no doubt, detrimental aspects to personal commercial solicitation in certain circumstances, *766 see id., at 464, and n. 23, but these detriments are not so inherent or ubiquitous that solicitation of this sort is removed from the ambit of First Amendment protection, cf. United States v. Kokinda, 497 U.S. 720, 725 (1990) (plurality opinion) ("Solicitation is a recognized form of speech protected by the First Amendment"); see also International Society for Krishna Consciousness v. Lee, 505 U.S. 672, 677 (1992).
In the commercial context, solicitation may have considerable value. Unlike many other forms of commercial expression, solicitation allows direct and spontaneous communication between buyer and seller. A seller has a strong financial incentive to educate the market and stimulate demand for his product or service, so solicitation produces more personal interchange between buyer and seller than would occur if only buyers were permitted to initiate contact. Personal interchange enables a potential buyer to meet and evaluate the person offering the product or service and allows both parties to discuss and negotiate the desired form for the transaction or professional relation. Solicitation also enables the seller to direct his proposals toward those consumers who he has a reason to believe would be most interested in what he has to sell. For the buyer, it provides an opportunity to explore in detail the way in which a particular product or service compares to its alternatives in the market. In particular, with respect to nonstandard products like the professional services offered by CPA's, these benefits are significant.
In denying CPA's and their clients these advantages, Florida's law threatens societal interests in broad access to complete and accurate commercial information that First Amendment coverage of commercial speech is designed to safeguard. See Virginia State Bd. of Pharmacy, supra, at 762-765; Bates v. State Bar of Arizona, 433 U.S. 350, 377-378 (1977); Central Hudson Gas & Electric Corp. v. Public Service Comm'n of N. Y., 447 U.S. 557, 561-562 (1980). *767 The commercial marketplace, like other spheres of our social and cultural life, provides a forum where ideas and information flourish. Some of the ideas and information are vital, some of slight worth. But the general rule is that the speaker and the audience, not the government, assess the value of the information presented. Thus, even a communication that does no more than propose a commercial transaction is entitled to the coverage of the First Amendment. See Virginia State Bd. of Pharmacy, supra, at 762.
Commercial speech, however, is "linked inextricably" with the commercial arrangement that it proposes, Friedman v. Rogers, 440 U.S. 1, 10, n. 9 (1979), so the State's interest in regulating the underlying transaction may give it a concomitant interest in the expression itself. See Ohralik, supra, at 457. For this reason, laws restricting commercial speech, unlike laws burdening other forms of protected expression, need only be tailored in a reasonable manner to serve a substantial state interest in order to survive First Amendment scrutiny. Board of Trustees of State University of N. Y. v. Fox, 492 U.S. 469, 480 (1989); Central Hudson Gas & Electric Corp., 447 U. S., at 564. Even under this intermediate standard of review, however, Florida's blanket ban on direct, in-person, uninvited solicitation by CPA's cannot be sustained as applied to Fane's proposed speech.
III
To determine whether personal solicitation by CPA's may be proscribed under the test set forth in Central Hudson we must ask whether the State's interests in proscribing it are substantial, whether the challenged regulation advances these interests in a direct and material way, and whether the extent of the restriction on protected speech is in reasonable proportion to the interests served. See ibid. Though we conclude that the Board's asserted interests are substantial, the Board has failed to demonstrate that its solicitation ban advances those interests.
*768 A
In undertaking the first inquiry, we must identify with care the interests the State itself asserts. Unlike rationalbasis review, the Central Hudson standard does not permit us to supplant the precise interests put forward by the State with other suppositions. See Fox, supra, at 480. Neither will we turn away if it appears that the stated interests are not the actual interests served by the restriction. See, e. g., Mississippi Univ. for Women v. Hogan, 458 U.S. 718, 730 (1982).
To justify its ban on personal solicitation by CPA's, the Board proffers two interests. First, the Board asserts an interest in protecting consumers from fraud or overreaching by CPA's. Second, the Board claims that its ban is necessary to maintain both the fact and appearance of CPA independence in auditing a business and attesting to its financial statements.
The State's first interest encompasses two distinct purposes: to prevent fraud and other forms of deception, and to protect privacy. As to the first purpose, we have said that "[t]he First Amendment . . . does not prohibit the State from insuring that the stream of commercial information flow[s] cleanly as well as freely," Virginia State Bd. of Pharmacy, 425 U. S., at 771-772, and our cases make clear that the State may ban commercial expression that is fraudulent or deceptive without further justification, see, e. g., Central Hudson Gas & Electric Corp., supra, at 563-564; In re R. M. J., 455 U.S. 191, 203 (1982); Metromedia, Inc. v. San Diego, 453 U.S. 490, 507 (1981) (plurality opinion). Indeed, 25 States and the District of Columbia take various forms of this approach, forbidding solicitation by CPA's only under circumstances that would render it fraudulent, deceptive, or coercive. See, e. g., Code of Colo. Regs. § 7.12 (1991); N. D. Admin. Code § 3-04-06-02 (1991); N. H. Code Admin. Rules § 507.02(c) (1990); D. C. Mun. Reg., Tit. 17, § 2513.4 (1990). But where, as with the blanket ban involved here, truthful *769 and nonmisleading expression will be snared along with fraudulent or deceptive commercial speech, the State must satisfy the remainder of the Central Hudson test by demonstrating that its restriction serves a substantial state interest and is designed in a reasonable way to accomplish that end. See In re R. M. J., supra, at 203. For purposes of that test, there is no question that Florida's interest in ensuring the accuracy of commercial information in the marketplace is substantial. See, e. g., Virginia State Bd. of Pharmacy, supra, at 771-772; San Francisco Arts & Athletics, Inc. v. United States Olympic Comm., 483 U.S. 522, 539 (1987); Friedman v. Rogers, supra, at 13.
Likewise, the protection of potential clients' privacy is a substantial state interest. Even solicitation that is neither fraudulent nor deceptive may be pressed with such frequency or vehemence as to intimidate, vex, or harass the recipient. In Ohralik, we made explicit that "protection of the public from these aspects of solicitation is a legitimate and important state interest." 436 U.S., at 462.
The Board's second justification for its banthe need to maintain the fact and appearance of CPA independence and to guard against conflicts of interestis related to the audit and attest functions of a CPA. In the course of rendering these professional services, a CPA reviews financial statements and attests that they have been prepared in accordance with generally accepted accounting principles and present a fair and accurate picture of the firm's financial condition. See generally R. Gormley, Law of Accountants and Auditors ¶ 1.07[4] (1981); 1 American Institute of Certified Public Accountants, Professional Standards AU § 110.01 (1991) (hereinafter AICPA Professional Standards). In the Board's view, solicitation compromises the independence necessary to perform the audit and attest functions, because a CPA who needs business enough to solicit clients will be prone to ethical lapses. The Board claims that even if actual misconduct does not occur, the public perception of CPA independence *770 will be undermined if CPA's behave like ordinary commercial actors.
We have given consistent recognition to the State's important interests in maintaining standards of ethical conduct in the licensed professions. See, e. g., Ohralik, supra, at 460; Virginia State Bd. of Pharmacy, supra, at 766; National Soc. of Professional Engineers v. United States, 435 U.S. 679, 696 (1978). With regard to CPA's, we have observed that they must "maintain total independence" and act with "complete fidelity to the public trust" when serving as independent auditors. United States v. Arthur Young & Co., 465 U.S. 805, 818 (1984). Although the State's interest in obscuring the commercial nature of public accounting practice is open to doubt, see Bates v. Arizona State Bar Assn., 433 U. S., at 369-371, the Board's asserted interest in maintaining CPA independence and ensuring against conflicts of interest is not. We acknowledge that this interest is substantial. See Ohralik, supra, at 460-461.
B
That the Board's asserted interests are substantial in the abstract does not mean, however, that its blanket prohibition on solicitation serves them. The penultimate prong of the Central Hudson test requires that a regulation impinging upon commercial expression "directly advance the state interest involved; the regulation may not be sustained if it provides only ineffective or remote support for the government's purpose." Central Hudson Gas & Electric Corp., 447 U. S., at 564. We agree with the Court of Appeals that the Board's ban on CPA solicitation as applied to the solicitation of business clients fails to satisfy this requirement.
It is well established that "[t]he party seeking to uphold a restriction on commercial speech carries the burden of justifying it." Bolger v. Youngs Drug Products Corp., 463 U.S. 60, 71, n. 20 (1983); Fox, 492 U. S., at 480. This burden is not satisfied by mere speculation or conjecture; rather, a governmental *771 body seeking to sustain a restriction on commercial speech must demonstrate that the harms it recites are real and that itsrestriction will in fact alleviate them to a material degree. See, e. g., Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U.S. 626, 648 649 (1985); Bolger, supra, at 73; In re R. M. J., 455 U. S., at 205-206; Central Hudson Gas & Electric Corp., supra, at 569; Friedman v. Rogers, 440 U. S., at 13-15; Linmark Associates, Inc. v. Willingboro, 431 U.S. 85, 95 (1977). Without this requirement, a State could with ease restrict commercial speech in the service of other objectives that could not themselves justify a burden on commercial expression.
The Board has not demonstrated that, as applied in the business context, the ban on CPA solicitation advances its asserted interests in any direct and material way. It presents no studies that suggest personal solicitation of prospective business clients by CPA's creates the dangers of fraud, overreaching, or compromised independence that the Board claims to fear. The record does not disclose any anecdotal evidence, either from Florida or another State, that validates the Board's suppositions. This is so even though 21 States place no specific restrictions of any kind on solicitation by CPA's, and only 3 States besides Florida have enacted a categorical ban. See 3 La. Admin. Code 46:XIX.507(D)(1)(c) (Supp. 1988); Minn. Admin. Code § 1100.6100 (1991); 22 Tex. Admin. Code § 501.44 (Supp. 1992). Not even Fane's own conduct suggests that the Board's concerns are justified. Cf. Ohralik, supra, at 467-468. The only suggestion that a ban on solicitation might help prevent fraud and overreaching or preserve CPA independence is the affidavit of Louis Dooner, which contains nothing more than a series of conclusory statements that add little if anything to the Board's original statement of its justifications.
The Board directs the Court's attention to a report on CPA solicitation prepared by the American Institute of Certified Public Accountants in 1981. See AICPA, Report of the Special *772 Committee on Solicitation (1981), App. 29. The Report contradicts, rather than strengthens, the Board's submissions. The AICPA Committee stated that it was "unaware of the existence of any empirical data supporting the theories that CPAs (a) are not independent of clients obtained by direct uninvited solicitation, or (b) do not maintain their independence in mental attitude toward those clients subjected to direct uninvited solicitation by another CPA." Id., at 4, App. 38. Louis Dooner's suggestion that solicitation of new accounts signals the need for work and invites an improper approach from the client ignores the fact that most CPA firms desire new clients. The AICPA Report discloses no reason to suspect that CPA's who engage in personal solicitation are more desperate for work, or would be any more inclined to compromise their professional standards, than CPA's who do not solicit, or who solicit only by mail or advertisement. With respect to the prospect of harassment or overreaching by CPA's, the report again acknowledges an "absence of persuasive evidence that direct uninvited solicitation by CPAs is likely to lead to false or misleading claims or oppressive conduct." Id., at 2, App. 35.
Other evidence concerning personal solicitation by CPA's also belies the Board's concerns. In contrast to the Board's anxiety over uninvited solicitation, the literature on the accounting profession suggests that the main dangers of compromised independence occur when a CPA firm is too dependent upon, or involved with, a longstanding client. See, e. g., P. Cottell & T. Perlin, Accounting Ethics 39-40 (1990); G. Previts, The Scope of CPA Services: A Study of the Development of the Concept of Independence and the Profession's Role in Society 142 (1985); S. Rep. No. 95-34, pp. 50-52 (1977); General Accounting Office, CPA Audit Quality: Status of Actions Taken to Improve Auditing and Financial Reporting of Public Companies 36 (Mar. 1989) (GAO/AFMD-89-38). It appears from the literature that a business executive who wishes to obtain a favorable but unjustified audit opinion *773 from a CPA would be less likely to turn to a stranger who has solicited him than to pressure his existing CPA, with whom he has an ongoing, personal relation and over whom he may also have some financial leverage. See id., at 34 ("A company using the threat of changing accountantsopinion shoppingto pressure its existing accounting firm to accept a less than desirable accounting treatment is one way independence is threatened"); Cottell & Perlin, supra, at 34 (noting that independence can be eroded if a client is served by a single auditor for a great length of time).
For similar reasons, we reject the Board's alternative argument that the solicitation ban is a reasonable restriction on the manner in which CPA's may communicate with prospective clients, rather than a direct regulation of the commercial speech itself. Assuming that a flat ban on commercial solicitation could be regarded as a content-neutral time, place, or manner restriction on speech, a proposition that is open to serious doubt, see, e. g., Virginia State Bd. of Pharmacy, 425 U. S., at 771, a challenged restriction of that type still must serve a substantial state interest in "a direct and effective way," Ward v. Rock Against Racism, 491 U.S. 781, 800 (1989). The State has identified certain interests in regulating solicitation in the accounting profession that are important and within its legitimate power, but the prohibitions here do not serve these purposes in a direct and material manner. Where a restriction on speech lacks this close and substantial relation to the governmental interests asserted, it cannot be, by definition, a reasonable time, place, or manner restriction.
C
Relying on Ohralik, the Board seeks to justify its solicitation ban as a prophylactic rule. It acknowledges that Fane's solicitations may not involve any misconduct but argues that all personal solicitation by CPA's must be banned, because this contact most often occurs in private offices and is difficult to regulate or monitor.
*774 We reject the Board's argument and hold that, as applied in this context, the solicitation ban cannot be justified as a prophylactic rule. Ohralik does not stand for the proposition that blanket bans on personal solicitation by all types of professionals are constitutional in all circumstances. Because "the distinctions, historical and functional, between professions, may require consideration of quite different factors," Virginia State Bd. of Pharmacy , supra, at 773, n. 25, the constitutionality of a ban on personal solicitation will depend upon the identity of the parties and the precise circumstances of the solicitation. Later cases have made this clear, explaining that Ohralik `s holding was narrow and depended upon certain "unique features of in-person solicitation by lawyers" that were present in the circumstances of that case. Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U. S., at 641; see also Shapero v. Kentucky Bar Assn. , 486 U.S. 466, 472 (1988).
Ohralik was a challenge to the application of Ohio's ban on attorney solicitation and held only that a State Bar "constitutionally may discipline a lawyer for soliciting clients in person, for pecuniary gain, under circumstances likely to pose dangers that the State has a right to prevent." Ohralik, 436 U. S., at 449. While Ohralik discusses the generic hazards of personal solicitation, see id., at 464-466, the opinion made clear that a preventative rule was justified only in situations "inherently conducive to overreaching and other forms of misconduct." Id., at 464; cf. In re R. M. J., 455 U. S., at 203 (advertising may be banned outright only if it is actually or inherently misleading). The Court in Ohralik explained why the case before it met this standard:
"[T]he potential for overreaching is significantly greater when a lawyer, a professional trained in the art of persuasion, personally solicits an unsophisticated, injured, or distressed lay person. Such an individual may place his trust in a lawyer, regardless of the latter's qualifications or the individual's actual need for legal representation, *775 simply in response to persuasion under circumstances conducive to uninformed acquiescence. Although it is argued that personal solicitation is valuable because it may apprise a victim of misfortune of his legal rights, the very plight of that person not only makes him more vulnerable to influence but also may make advice all the more intrusive. Thus, under these adverse conditions the overtures of an uninvited lawyer may distress the solicited individual simply because of their obtrusiveness and the invasion of the individual's privacy, even when no other harm materializes. Under such circumstances, it is not unreasonable for the State to presume that in-person solicitation by lawyers more often than not will be injurious to the person solicited." 436 U.S., at 465-466 (footnotes omitted).
The solicitation here poses none of the same dangers. Unlike a lawyer, a CPA is not "a professional trained in the art of persuasion." A CPA's training emphasizes independence and objectivity, not advocacy. See 1 AICPA Professional Standards AU § 220; 2 id., ET § 55; H. Magill & G. Previts, CPA Professional Responsibilities: An Introduction 105-108 (1991). The typical client of a CPA is far less susceptible to manipulation than the young accident victim in Ohralik. Fane's prospective clients are sophisticated and experienced business executives who understand well the services that a CPA offers. See Affidavit of Scott Fane ¶¶ 5-7, 10(A), App. 10-11, 13. In general, the prospective client has an existing professional relation with an accountant and so has an independent basis for evaluating the claims of a new CPA seeking professional work. Id., ¶ 6, App. 10-11.
The manner in which a CPA like Fane solicits business is conducive to rational and considered decisionmaking by the prospective client, in sharp contrast to the "uninformed acquiescence" to which the accident victims in Ohralik were prone. Ohralik, supra, at 465. While the clients in Ohralik were approached at a moment of high stress and *776 vulnerability, the clients Fane wishes to solicit meet him in their own offices at a time of their choosing. If they are unreceptive to his initial telephone solicitation, they need only terminate the call. Invasion of privacy is not a significant concern.
If a prospective client does decide to meet with Fane, there is no expectation or pressure to retain Fane on the spot; instead, he or she most often exercises caution, checking references and deliberating before deciding to hire a new CPA. See Affidavit of Scott Fane ¶ 10(C), App. 13-14. Because a CPA has access to a business firm's most sensitive financial records and internal documents, retaining a new accountant is not a casual decision. Ibid. The engagements Fane seeks are also long term in nature; to the extent he engages in unpleasant, high pressure sales tactics, he can impair rather than improve his chances of obtaining an engagement or establishing a satisfactory professional relation. The importance of repeat business and referrals gives the CPA a strong incentive to act in a responsible and decorous manner when soliciting business. In contrast with Ohralik, it cannot be said that under these circumstances, personal solicitation by CPA's "more often than not will be injurious to the person solicited." Ohralik, 436 U. S., at 466.
The Board's reliance on Ohralik is misplaced for yet another reason: The Board misunderstands what Ohralik meant when it approved the use of a prophylactic rule. Id., at 464. The ban on attorney solicitation in Ohralik was prophylactic in the sense that it prohibited conduct conducive to fraud or overreaching at the outset, rather than punishing the misconduct after it occurred. But Ohralik in no way relieves the State of the obligation to demonstrate that it is regulating speech in order to address what is in fact a serious problem and that the preventative measure it proposes will contribute in a material way to solving that problem. See ibid. (describing the State's fear of harm from attorney solicitation as "well founded").
*777 Were we to read Ohralik in the manner the Board proposes, the protection afforded commercial speech would be reduced almost to nothing; comprehensive bans on certain categories of commercial speech would be permitted as a matter of course. That would be inconsistent with the results reached in a number of our prior cases. See, e. g., Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U.S. 626 (1985); Bates v. State Bar of Arizona, 433 U.S. 350 (1977); Linmark Associates, Inc. v. Willingboro, 431 U.S. 85 (1977). It would also be inconsistent with this Court's general approach to the use of preventative rules in the First Amendment context. "Broad prophylactic rules in the area of free expression are suspect. Precision of regulation must be the touchstone in an area so closely touching our most precious freedoms." NAACP v. Button, 371 U.S. 415, 438 (1963) (citations omitted). Even under the First Amendment's somewhat more forgiving standards for restrictions on commercial speech, a State may not curb protected expression without advancing a substantial governmental interest. Here, the ends sought by the State are not advanced by the speech restriction, and legitimate commercial speech is suppressed. For this reason, the Board's rule infringes upon Fane's right to speak, as guaranteed by the Constitution.
The judgment of the Court of Appeals is
Affirmed. | In previous cases we have considered the constitutionality of state laws prohibiting lawyers from engaging in direct, personal solicitation of prospective clients. See ; In re Primus, In the case now before us, we consider a solicitation ban applicable to certified public accountants (CPA's) enacted by the State of Florida. We hold that, as applied to CPA solicitation in the business context, Florida's prohibition is inconsistent with the free speech guarantees of the First and Fourteenth Amendments. I Respondent Scott Fane is a CPA licensed to practice in the State of Florida by the Florida Board of Accountancy (Board). Before moving to Florida in 1985, Fane had his own accounting CPA practice in New Jersey, specializing in providing tax advice to small and medium-sized businesses. He often obtained business clients by making unsolicited telephone calls to their executives and arranging meetings to explain his services and expertise. This direct, personal, uninvited solicitation was permitted under New Jersey law. When he moved to Florida, Fane wished to build a practice similar to his solo practice in New Jersey but was unable to do so because the Board of Accountancy had a comprehensive rule prohibiting CPA's from engaging in the direct, personal *764 solicitation he had found most effective in the past. The Board's rules provide that a CPA "shall not by any direct, in-person, uninvited solicitation solicit an engagement to perform public accounting services where the engagement would be for a person or entity not already a client of [the CPA], unless such person or entity has invited such a communication." Fla. Admin. Code 21A-24.002(2)(c) "[D]irect, in-person, uninvited solicitation" means "any communication which directly or implicitly requests an immediate oral response from the recipient," which, under the Board's rules, includes all "[u]ninvited in-person visits or conversations or telephone calls to a specific potential client." 21A-24.002(3). The rule, according to Fane's uncontradicted submissions, presented a serious obstacle, because most businesses are willing to rely for advice on the accountants or CPA's already serving them. In Fane's experience, persuading a business to sever its existing accounting relations or alter them to include a new CPA on particular assignments requires the new CPA to contact the business and explain the advantages of a change. This entails a detailed discussion of the client's needs and the CPA's expertise, services and fees. See Affidavit of Scott Fane ¶¶ 7, 11, App. 11, 15. Fane sued the Board in the United States District Court for the Northern District of Florida, seeking declaratory and injunctive relief on the ground that the Board's antisolicitation rule violated the First and Fourteenth Amendments. Fane alleged that but for the prohibition he would seek clients through personal solicitation and would offer fees below prevailing rates. Complaint ¶¶ 9-11, App. 3-4. In response to Fane's submissions, the Board relied on the affidavit of Louis Dooner, one of its former chairmen. Dooner concluded that the solicitation ban was necessary to preserve the independence of CPA's performing the attest function, which involves the rendering of opinions on a firm's financial statements. His premise was that a CPA who solicits *765 clients "is obviously in need of business and may be willing to bend the rules." App. 23. In Dooner's view, "[i]f [a CPA] has solicited the client he will be beholden to him." Dooner also suggested that the ban was needed to prevent "overreaching and vexatious conduct by the CPA." The District Court gave summary judgment to Fane and enjoined enforcement of the rule "as it is applied to CPA's who seek clients through in-person, direct, uninvited solicitation in the business context." Civ. Case No. 88-40264MNP App. 88. A divided panel of the Court of Appeals for the Eleventh Circuit affirmed. We granted certiorari, and now affirm. II In soliciting potential clients, Fane seeks to communicate no more than truthful, nondeceptive information proposing a lawful commercial transaction. We need not parse Fane's proposed communications to see if some parts are entitled to greater protection than the solicitation itself. This case comes to us testing the solicitation, nothing more. That is what the State prohibits and Fane proposes. Whatever ambiguities may exist at the margins of the category of commercial speech, see, e. g., Pittsburgh Press it is clear that this type of personal solicitation is commercial expression to which the protections of the First Amendment apply. E. g., Virginia State Bd. of While we did uphold a ban on in-person solicitation by lawyers in that opinion did not hold that all personal solicitation is without First Amendment protection. See There are, no doubt, detrimental aspects to personal commercial solicitation in certain circumstances, *766 see and n. 23, but these detriments are not so inherent or ubiquitous that solicitation of this sort is removed from the ambit of First Amendment protection, cf. United ("Solicitation is a recognized form of speech protected by the First Amendment"); see also International Society for Krishna In the commercial context, solicitation may have considerable value. Unlike many other forms of commercial expression, solicitation allows direct and spontaneous communication between buyer and seller. A seller has a strong financial incentive to educate the market and stimulate demand for his product or service, so solicitation produces more personal interchange between buyer and seller than would occur if only buyers were permitted to initiate contact. Personal interchange enables a potential buyer to meet and evaluate the person offering the product or service and allows both parties to discuss and negotiate the desired form for the transaction or professional relation. Solicitation also enables the seller to direct his proposals toward those consumers who he has a reason to believe would be most interested in what he has to sell. For the buyer, it provides an opportunity to explore in detail the way in which a particular product or service compares to its alternatives in the market. In particular, with respect to nonstandard products like the professional services offered by CPA's, these benefits are significant. In denying CPA's and their clients these advantages, Florida's law threatens societal interests in broad access to complete and accurate commercial information that First Amendment coverage of commercial speech is designed to safeguard. See Virginia State Bd. of at -765; ; Central Hudson Gas & Electric *767 The commercial marketplace, like other spheres of our social and cultural life, provides a forum where ideas and information flourish. Some of the ideas and information are vital, some of slight worth. But the general rule is that the speaker and the audience, not the government, assess the value of the information presented. Thus, even a communication that does no more than propose a commercial transaction is entitled to the coverage of the First Amendment. See Virginia State Bd. of at Commercial speech, however, is "linked inextricably" with the commercial arrangement that it proposes, so the State's interest in regulating the underlying transaction may give it a concomitant interest in the expression itself. See For this reason, laws restricting commercial speech, unlike laws burdening other forms of protected expression, need only be tailored in a reasonable manner to serve a substantial state interest in order to survive First Amendment scrutiny. Board of Trustees of State University of N. ; Central Hudson Gas & Electric Even under this intermediate standard of review, however, Florida's blanket ban on direct, in-person, uninvited solicitation by CPA's cannot be sustained as applied to Fane's proposed speech. III To determine whether personal solicitation by CPA's may be proscribed under the test set forth in Central Hudson we must ask whether the State's interests in proscribing it are substantial, whether the challenged regulation advances these interests in a direct and material way, and whether the extent of the restriction on protected speech is in reasonable proportion to the interests served. See Though we conclude that the Board's asserted interests are substantial, the Board has failed to demonstrate that its solicitation ban advances those interests. *768 A In undertaking the first inquiry, we must identify with care the interests the State itself asserts. Unlike rationalbasis review, the Central Hudson standard does not permit us to supplant the precise interests put forward by the State with other suppositions. See at Neither will we turn away if it appears that the stated interests are not the actual interests served by the restriction. See, e. g., Mississippi Univ. for To justify its ban on personal solicitation by CPA's, the Board proffers two interests. First, the Board asserts an interest in protecting consumers from fraud or overreaching by CPA's. Second, the Board claims that its ban is necessary to maintain both the fact and appearance of CPA independence in auditing a business and attesting to its financial statements. The State's first interest encompasses two distinct purposes: to prevent fraud and other forms of deception, and to protect privacy. As to the first purpose, we have said that "[t]he First Amendment does not prohibit the State from insuring that the stream of commercial information flow[s] cleanly as well as freely," Virginia State Bd. of -772, and our cases make clear that the State may ban commercial expression that is fraudulent or deceptive without further justification, see, e. g., Central Hudson Gas & Electric ; In re R. M. ; Metromedia, Indeed, 25 States and the District of Columbia take various forms of this approach, forbidding solicitation by CPA's only under circumstances that would render it fraudulent, deceptive, or coercive. See, e. g., Code of Colo. Regs. 7.12 ; N. D. Admin. Code 3-04-06-02 ; N. H. Code Admin. Rules02(c) ; D. C. Mun. Reg., Tit. 17, 2513.4 But where, as with the blanket ban involved here, truthful *769 and nonmisleading expression will be snared along with fraudulent or deceptive commercial speech, the State must satisfy the remainder of the Central Hudson test by demonstrating that its restriction serves a substantial state interest and is designed in a reasonable way to accomplish that end. See In re R. M. at For purposes of that test, there is no question that Florida's interest in ensuring the accuracy of commercial information in the marketplace is substantial. See, e. g., Virginia State Bd. of ; San Francisco Arts & Athletics, ; Likewise, the protection of potential clients' privacy is a substantial state interest. Even solicitation that is neither fraudulent nor deceptive may be pressed with such frequency or vehemence as to intimidate, vex, or harass the recipient. In we made explicit that "protection of the public from these aspects of solicitation is a legitimate and important state interest." The Board's second justification for its banthe need to maintain the fact and appearance of CPA independence and to guard against conflicts of interestis related to the audit and attest functions of a CPA. In the course of rendering these professional services, a CPA reviews financial statements and attests that they have been prepared in accordance with generally accepted accounting principles and present a fair and accurate picture of the firm's financial condition. See generally R. Gormley, Law of Accountants and Auditors ¶ 1.07[4] ; 1 American Institute of Certified Public Accountants, Professional Standards AU 110.01 (hereinafter AICPA Professional Standards). In the Board's view, solicitation compromises the independence necessary to perform the audit and attest functions, because a CPA who needs business enough to solicit clients will be prone to ethical lapses. The Board claims that even if actual misconduct does not occur, the public perception of CPA independence *770 will be undermined if CPA's behave like ordinary commercial actors. We have given consistent recognition to the State's important interests in maintaining standards of ethical conduct in the licensed professions. See, e. g., ; Virginia State Bd. of ; National Soc. of Professional With regard to CPA's, we have observed that they must "maintain total independence" and act with "complete fidelity to the public trust" when serving as independent auditors. United Although the State's interest in obscuring the commercial nature of public accounting practice is open to doubt, see Bates v. Arizona State Bar -371, the Board's asserted interest in maintaining CPA independence and ensuring against conflicts of interest is not. We acknowledge that this interest is substantial. See -461. B That the Board's asserted interests are substantial in the abstract does not mean, however, that its blanket prohibition on solicitation serves them. The penultimate prong of the Central Hudson test requires that a regulation impinging upon commercial expression "directly advance the state interest involved; the regulation may not be sustained if it provides only ineffective or remote support for the government's purpose." Central Hudson Gas & Electric We agree with the Court of Appeals that the Board's ban on CPA solicitation as applied to the solicitation of business clients fails to satisfy this requirement. It is well established that "[t]he party seeking to uphold a restriction on commercial speech carries the burden of justifying it." v. Youngs Drug Products ; 492 U. S., at This burden is not satisfied by mere speculation or conjecture; rather, a governmental *771 body seeking to sustain a restriction on commercial speech must demonstrate that the harms it recites are real and that itsrestriction will in fact alleviate them to a material degree. See, e. g., ; ; In re R. M. -206; Central Hudson Gas & Electric ; 440 U. S., -15; Linmark Associates, Without this requirement, a State could with ease restrict commercial speech in the service of other objectives that could not themselves justify a burden on commercial expression. The Board has not demonstrated that, as applied in the business context, the ban on CPA solicitation advances its asserted interests in any direct and material way. It presents no studies that suggest personal solicitation of prospective business clients by CPA's creates the dangers of fraud, overreaching, or compromised independence that the Board claims to fear. The record does not disclose any anecdotal evidence, either from Florida or another State, that validates the Board's suppositions. This is so even though 21 States place no specific restrictions of any kind on solicitation by CPA's, and only 3 States besides Florida have enacted a categorical ban. See 3 La. Admin. Code 46:XIX.(D)(1)(c) ; Minn. Admin. Code 1100.6100 ; 22 Tex. Admin. Code 501.44 Not even Fane's own conduct suggests that the Board's concerns are justified. Cf. The only suggestion that a ban on solicitation might help prevent fraud and overreaching or preserve CPA independence is the affidavit of Louis Dooner, which contains nothing more than a series of conclusory statements that add little if anything to the Board's original statement of its justifications. The Board directs the Court's attention to a report on CPA solicitation prepared by the American Institute of Certified Public Accountants in 1981. See AICPA, Report of the Special *772 Committee on Solicitation App. 29. The Report contradicts, rather than strengthens, the Board's submissions. The AICPA Committee stated that it was "unaware of the existence of any empirical data supporting the theories that CPAs (a) are not independent of clients obtained by direct uninvited solicitation, or (b) do not maintain their independence in mental attitude toward those clients subjected to direct uninvited solicitation by another CPA." App. 38. Louis Dooner's suggestion that solicitation of new accounts signals the need for work and invites an improper approach from the client ignores the fact that most CPA firms desire new clients. The AICPA Report discloses no reason to suspect that CPA's who engage in personal solicitation are more desperate for work, or would be any more inclined to compromise their professional standards, than CPA's who do not solicit, or who solicit only by mail or advertisement. With respect to the prospect of harassment or overreaching by CPA's, the report again acknowledges an "absence of persuasive evidence that direct uninvited solicitation by CPAs is likely to lead to false or misleading claims or oppressive conduct." App. 35. Other evidence concerning personal solicitation by CPA's also belies the Board's concerns. In contrast to the Board's anxiety over uninvited solicitation, the literature on the accounting profession suggests that the main dangers of compromised independence occur when a CPA firm is too dependent upon, or involved with, a longstanding client. See, e. g., P. Cottell & T. Accounting Ethics 39-40 ; G. Previts, The Scope of CPA Services: A Study of the Development of the Concept of Independence and the Profession's Role in Society 142 ; S. Rep. No. -34, pp. 50-52 ; General Accounting Office, CPA Audit Quality: Status of Actions Taken to Improve Auditing and Financial Reporting of Public Companies 36 (GAO/AFMD-89-38). It appears from the literature that a business executive who wishes to obtain a favorable but unjustified audit opinion *773 from a CPA would be less likely to turn to a stranger who has solicited him than to pressure his existing CPA, with whom he has an ongoing, personal relation and over whom he may also have some financial leverage. See ; Cottell & For similar reasons, we reject the Board's alternative argument that the solicitation ban is a reasonable restriction on the manner in which CPA's may communicate with prospective clients, rather than a direct regulation of the commercial speech itself. Assuming that a flat ban on commercial solicitation could be regarded as a content-neutral time, place, or manner restriction on speech, a proposition that is open to serious doubt, see, e. g., Virginia State Bd. of a challenged restriction of that type still must serve a substantial state interest in "a direct and effective way," The State has identified certain interests in regulating solicitation in the accounting profession that are important and within its legitimate power, but the prohibitions here do not serve these purposes in a direct and material manner. Where a restriction on speech lacks this close and substantial relation to the governmental interests asserted, it cannot be, by definition, a reasonable time, place, or manner restriction. C Relying on the Board seeks to justify its solicitation ban as a prophylactic rule. It acknowledges that Fane's solicitations may not involve any misconduct but argues that all personal solicitation by CPA's must be banned, because this contact most often occurs in private offices and is difficult to regulate or monitor. *774 We reject the Board's argument and hold that, as applied in this context, the solicitation ban cannot be justified as a prophylactic rule. does not stand for the proposition that blanket bans on personal solicitation by all types of professionals are constitutional in all circumstances. Because "the distinctions, historical and functional, between professions, may require consideration of quite different factors," Virginia State Bd. of the constitutionality of a ban on personal solicitation will depend upon the identity of the parties and the precise circumstances of the solicitation. Later cases have made this clear, explaining that `s holding was narrow and depended upon certain "unique features of in-person solicitation by lawyers" that were present in the circumstances of that case. ; see also Shapero v. Kentucky Bar was a challenge to the application of 's ban on attorney solicitation and held only that a State Bar "constitutionally may discipline a lawyer for soliciting clients in person, for pecuniary gain, under circumstances likely to pose dangers that the State has a right to prevent." 436 U. S., 49. While discusses the generic hazards of personal solicitation, see -466, the opinion made clear that a preventative rule was justified only in situations "inherently conducive to overreaching and other forms of misconduct." ; cf. In re R. M. 455 U. S., at The Court in explained why the case before it met this standard: "[T]he potential for overreaching is significantly greater when a lawyer, a professional trained in the art of persuasion, personally solicits an unsophisticated, injured, or distressed lay person. Such an individual may place his trust in a lawyer, regardless of the latter's qualifications or the individual's actual need for legal representation, *775 simply in response to persuasion under circumstances conducive to uninformed acquiescence. Although it is argued that personal solicitation is valuable because it may apprise a victim of misfortune of his legal rights, the very plight of that person not only makes him more vulnerable to influence but also may make advice all the more intrusive. Thus, under these adverse conditions the overtures of an uninvited lawyer may distress the solicited individual simply because of their obtrusiveness and the invasion of the individual's privacy, even when no other harm materializes. Under such circumstances, it is not unreasonable for the State to presume that in-person solicitation by lawyers more often than not will be injurious to the person solicited." 436 U.S., 65-466 The solicitation here poses none of the same dangers. Unlike a lawyer, a CPA is not "a professional trained in the art of persuasion." A CPA's training emphasizes independence and objectivity, not advocacy. See 1 AICPA Professional Standards AU 220; 2 ET 55; H. Magill & G. Previts, CPA Professional Responsibilities: An Introduction 105-108 The typical client of a CPA is far less susceptible to manipulation than the young accident victim in Fane's prospective clients are sophisticated and experienced business executives who understand well the services that a CPA offers. See Affidavit of Scott Fane ¶¶ 5-7, 10(A), App. 10-11, 13. In general, the prospective client has an existing professional relation with an accountant and so has an independent basis for evaluating the claims of a new CPA seeking professional work. App. 10-11. The manner in which a CPA like Fane solicits business is conducive to rational and considered decisionmaking by the prospective client, in sharp contrast to the "uninformed acquiescence" to which the accident victims in were prone. 65. While the clients in were approached at a moment of high stress and *776 vulnerability, the clients Fane wishes to solicit meet him in their own offices at a time of their choosing. If they are unreceptive to his initial telephone solicitation, they need only terminate the call. Invasion of privacy is not a significant concern. If a prospective client does decide to meet with Fane, there is no expectation or pressure to retain Fane on the spot; instead, he or she most often exercises caution, checking references and deliberating before deciding to hire a new CPA. See Affidavit of Scott Fane ¶ 10(C), App. 13-14. Because a CPA has access to a business firm's most sensitive financial records and internal documents, retaining a new accountant is not a casual decision. The engagements Fane seeks are also long term in nature; to the extent he engages in unpleasant, high pressure sales tactics, he can impair rather than improve his chances of obtaining an engagement or establishing a satisfactory professional relation. The importance of repeat business and referrals gives the CPA a strong incentive to act in a responsible and decorous manner when soliciting business. In contrast with it cannot be said that under these circumstances, personal solicitation by CPA's "more often than not will be injurious to the person solicited." 436 U. S., 66. The Board's reliance on is misplaced for yet another reason: The Board misunderstands what meant when it approved the use of a prophylactic rule. The ban on attorney solicitation in was prophylactic in the sense that it prohibited conduct conducive to fraud or overreaching at the outset, rather than punishing the misconduct after it occurred. But in no way relieves the State of the obligation to demonstrate that it is regulating speech in order to address what is in fact a serious problem and that the preventative measure it proposes will contribute in a material way to solving that problem. See *777 Were we to read in the manner the Board proposes, the protection afforded commercial speech would be reduced almost to nothing; comprehensive bans on certain categories of commercial speech would be permitted as a matter of course. That would be inconsistent with the results reached in a number of our prior cases. See, e. g., ; ; Linmark Associates, It would also be inconsistent with this Court's general approach to the use of preventative rules in the First Amendment context. "Broad prophylactic rules in the area of free expression are suspect. Precision of regulation must be the touchstone in an area so closely touching our most precious freedoms." Even under the First Amendment's somewhat more forgiving standards for restrictions on commercial speech, a State may not curb protected expression without advancing a substantial governmental interest. Here, the ends sought by the State are not advanced by the speech restriction, and legitimate commercial speech is suppressed. For this reason, the Board's rule infringes upon Fane's right to speak, as guaranteed by the Constitution. The judgment of the Court of Appeals is Affirmed. |
Justice Powell | majority | false | Bob Jones Univ. v. Simon | 1974-05-15T00:00:00 | null | https://www.courtlistener.com/opinion/109028/bob-jones-univ-v-simon/ | https://www.courtlistener.com/api/rest/v3/clusters/109028/ | 1,974 | 1973-107 | 2 | 8 | 0 | This case and Commissioner v. "Americans United" Inc., post, p. 752, involve the application of the Anti-Injunction *727 Act, § 7421 (a) of the Internal Revenue Code of 1954 (the Code), 26 U.S. C. § 7421 (a), to the ruling-letter program of the Internal Revenue Service (the Service) for organizations claiming tax-exempt status under Code § 501 (c) (3), 26 U.S. C. § 501 (c) (3). The question presented is whether, prior to the assessment and collection of any tax, a court may enjoin the Service from revoking a ruling letter declaring that petitioner qualifies for tax-exempt status and from withdrawing advance assurance to donors that contributions to petitioner will constitute charitable deductions under Code § 170 (c) (2), 26 U.S. C. § 170 (c) (2). We hold that it may not.
I
Section 501 (a) of the Code exempts from federal income taxes organizations described in § 501 (c) (3). The latter provision encompasses:
"Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation, and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of any candidate for public office."
Section 501 (c) (3) organizations are also exempt from federal social security (FICA) taxes by virtue of Code § 3121 (b) (8) (B), 26 U.S. C. § 3121 (b) (8) (B), and from federal unemployment (FUTA) taxes by virtue of § 3306 (c) (8), 26 U.S. C. § 3306 (c) (8). Donations *728 to § 501 (c) (3) organizations are tax deductible under § 170 (c) (2).[1]
As a practical matter, an organization hoping to solicit tax-deductible contributions may not rely solely on technical compliance with the language of §§ 501 (c) (3) and 170 (c) (2). The organization must also obtain a ruling letter from the Service, pursuant to Rev. Procs. 72-3 and 72-4, 1972-1 Cum. Bull. 698, 706, declaring that it qualifies under § 501 (c) (3). Receipt of such a ruling letter leads, in the ordinary case, to inclusion in *729 the Service's periodically updated Publication No. 78, "Cumulative List of Organizations described in Section 170 (c) of the Internal Revenue Code of 1954" (the Cumulative List). In essence, the Cumulative List is the Service's official roster of tax-exempt organizations: "The listing of an organization in [the Cumulative List] signifies it has received a ruling or determination letter . . . stating that contributions by donors to the organization are deductible as provided in section 170 of the Code." Rev. Proc. 72-39, 1972-2 Cum. Bull. 818. An organization's inclusion in the Cumulative List assures potential donors in advance that contributions to the organization will qualify as charitable deductions under § 170 (c) (2). The Service has announced that, with narrowly limited exceptions, a donor may rely on the Cumulative List for so long as the beneficiaries of his largesse maintain their listing, regardless of their actual tax status.[2] For this reason, appearance on the Cumulative List is a prerequisite to successful fund raising *730 for most charitable organizations. Many contributors simply will not make donations to an organization that does not appear on the Cumulative List.[3]
Because of the importance of inclusion in the Cumulative List, revocation of a § 501 (c) (3) ruling letter and consequent removal from the Cumulative List is likely to result in serious damage to a charitable organization.[4] Revocation not only threatens the flow of contributions, it also subjects the affected organization to FICA and FUTA taxes and, assuming that the organization has taxable income and does not qualify as tax exempt under another subsection of § 501, to federal income taxes.[5] Upon the assessment and attempted collection of income taxes, the organization may litigate the legality of the Service's action by petitioning the Tax Court to review a notice of deficiency. See Code §§ 6212 and 6213, 26 U.S. C. §§ 6212 and 6213. Or, following the collection of any federal tax and the denial of a refund by the Service, the organization may bring a *731 refund suit in a federal district court or in the Court of Claims. See Code § 7422, 26 U.S. C. § 7422; 28 U.S. C. §§ 1346 (a) (1) and 1491. Finally, a donor to the organization may bring a refund suit to challenge the denial of a charitable deduction under § 170 (c) (2). Presumably such a "friendly donor" would be able to attack the legality of the Service's revocation of an organization's § 501 (c) (3) status. But these post-revocation avenues of review take substantial time, during which the organization is certain to lose contributions from those donors whose gifts are contingent on entitlement to charitable deductions under § 170 (c) (2). Accordingly, any organization threatened with revocation of a § 501 (c) (3) ruling letter has a powerful incentive to bring a pre-enforcement suit to prevent the Service from taking action in the first instance.
The pressures operating on organizations facing revocation of § 501 (c) (3) status to seek injunctive relief against the Service pending judicial review of the proposed action conflict directly with a congressional prohibition of such pre-enforcement tax suits. In force continuously since its enactment in 1867, the Anti-Injunction Act, now Code § 7421 (a), provides in pertinent part that "no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court . . . ."[6] Because an injunction *732 preventing the Service from withdrawing a § 501 (c) (3) ruling letter would necessarily preclude the collection of FICA, FUTA, and possibly income taxes from the affected organization, as well as the denial of § 170 (c) (2) charitable deductions to donors to the organization, a suit seeking such relief falls squarely within the literal scope of the Act.[7]
*733 The clash between the language of the Anti-Injunction Act and the desire of § 501 (c) (3) organizations to block the Service from withdrawing a ruling letter has been resolved against the organizations in most cases. E. g., *734 Crenshaw County Private School Foundation v. Connally, 474 F.2d 1185 (CA5 1973), pet. for cert. pending in No. 73-170; National Council on the Facts of Over-population v. Caplin, 224 F. Supp. 313 (DC 1963); Israelite House of David v. Holden, 14 F.2d 701 (WD Mich. 1926).[8] But see McGlotten v. Connally, 338 F. Supp. 448 (DC 1972) (three-judge court). Cf. Green v. Connally, 330 F. Supp. 1150 (DC), aff'd per curiam sub nom. Coit v. Green, 404 U.S. 997 (1971).
In the present case, the Court of Appeals for the Fourth Circuit followed the majority view. Bob Jones University v. Connally, 472 F.2d 903, petition for rehearing denied, 476 F.2d 259 (1973). In light of the contrary result reached by the Court of Appeals for the District of Columbia Circuit in "Americans United" Inc. v. Walters, 155 U. S. App. D. C. 284, 477 F.2d 1169 (1973), rev'd sub nom. Commissioner v. "Americans United" Inc., post, p. 752, we granted Bob Jones University's petition for certiorari. 414 U.S. 817 (1973).
II
Petitioner refers to itself as "the world's most unusual university." Founded in 1927 and now located in Greenville, South Carolina, the University is devoted to the teaching and propagation of its fundamentalist religious beliefs. All classes commence and close with prayer, *735 and courses in religion are compulsory. Students and faculty are screened for adherence to certain religious precepts and may be expelled or dismissed for lack of allegiance to them. One of these beliefs is that God intended segregation of the races and that the Scriptures forbid interracial marriage. Accordingly, petitioner refuses to admit Negroes as students. On pain of expulsion students are prohibited from interracial dating, and petitioner believes that it would be impossible to enforce this prohibition absent the exclusion of Negroes.
In 1942, the Service issued petitioner a ruling letter under § 101 (6) of the Internal Revenue Code of 1939, the predecessor of § 501 (c) (3). In 1970, however, the Service announced that it would no longer allow § 501 (c) (3) status for private schools maintaining racially discriminatory admissions policies and that it would no longer treat contributions to such schools as tax deductible. See Rev. Rul. 71-447, 1971-2 Cum. Bull. 230. The Service requested proof of a nondiscriminatory admissions policy from all such schools and warned that tax-exempt ruling letters would be reviewed in light of the information provided. At the end of 1970, petitioner advised the Service that it did not admit Negroes, and in September 1971, further stated that it had no intention of altering this policy. The Commissioner of Internal Revenue therefore instructed the District Director to commence administrative procedures leading to the revocation of petitioner's § 501 (c) (3) ruling letter.
Petitioner brought these administrative proceedings to a halt by filing suit in the United States District Court for the District of South Carolina for preliminary and permanent injunctive relief preventing the Service from revoking or threatening to revoke petitioner's tax-exempt status. Petitioner alleged irreparable injury in the form of substantial federal income tax liability and the loss of *736 contributions. Petitioner asserted that the Service's threatened action was outside its lawful authority and would violate petitioner's rights to the free exercise of religion, to free association, and to due process and equal protection of the laws.
The District Court rejected a motion to dismiss for lack of jurisdiction, and it preliminarily enjoined the Service from revoking or threatening to revoke petitioner's tax-exempt status and from withdrawing advance assurance of the deductibility of contributions made to petitioner. Bob Jones University v. Connally, 341 F. Supp. 277 (1971). The Court of Appeals for the Fourth Circuit reversed, with one judge dissenting. 472 F.2d 903, reh. den., 476 F.2d 259 (1973). That court held that petitioner's suit was barred by the Anti-Injunction Act as interpreted by this Court in Enochs v. Williams Packing & Navigation Co., 370 U.S. 1. (1962).
III
The Anti-Injunction Act apparently has no recorded legislative history,[9] but its language could scarcely be more explicit"no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court . . . ." The Court has interpreted the principal purpose of this language to be the protection of the Government's need to assess and collect taxes as expeditiously as possible with a minimum of pre-enforcement judicial interference, "and to require that the legal right to the disputed sums be determined in a suit for refund." Enochs v. Williams Packing & Navigation *737 Co., supra, at 7. See also, e. g., State Railroad Tax Cases, 92 U.S. 575, 613-614 (1876). Cf. Cheatham v. United States, 92 U.S. 85, 88-89 (1876). The Court has also identified "a collateral objective of the Actprotection of the collector from litigation pending a suit for refund." Williams Packing, supra, at 7-8.
In furtherance of these goals, the Court in its most recent reading gave the Act almost literal effect. In Williams Packing, an employer sought to enjoin the collection of FICA and FUTA taxes that the employer alleged were not owed and would destroy its business. The Court held unanimously that the suit was barred by the Act. Only upon proof of the presence of two factors could the literal terms of § 7421 (a) be avoided: first, irreparable injury, the essential prerequisite for injunctive relief in any case; and second, certainty of success on the merits. Id., at 6-7. An injunction could issue only "if it is clear that under no circumstances could the Government ultimately prevail . . . ." Id., at 7. And this determination would be made on the basis of the information available to the Government at the time of the suit. "Only if it is then apparent that, under the most liberal view of the law and the facts, the United States cannot establish its claim, may the suit for an injunction be maintained." Ibid.
Perhaps in recognition of the stringent nature of the Williams Packing standard and its implications for this case, petitioner makes little effort to argue that it can meet that test. Rather, it asserts that the Anti-Injunction Act, properly construed, is not applicable, that Williams Packing is not the controlling reading of the Act, and that rejection of both these contentions would work a denial of due process of law. We find these arguments unpersuasive.
*738 A
First, petitioner contends that the Act is inapplicable because this is not a suit "for the purpose of restraining the assessment or collection of any tax . . . ." Under petitioner's theory, its suit is intended solely to compel the Service to refrain from withdrawing petitioner's § 501 (c) (3) ruling letter and from depriving petitioner's donors of advance assurance of deductibility. Petitioner describes its goal as the maintenance of the flow of contributions, not the obstruction of revenue.
Petitioner's complaint and supporting documents filed in the District Court belie any notion that this is not a suit to enjoin the assessment or collection of federal taxes from petitioner. In support of its claim of irreparable injury, petitioner alleged in part that it would be subject to "substantial" federal income tax liability if the Service were allowed to carry out its threatened action. App. 6. Petitioner buttressed this contention with sworn affidavits alleging federal income tax liability of three-quarters of a million dollars for one year and in excess of half a million dollars for another and stressing the detrimental effect such tax liability would have on petitioner's capacity to operate its institution, to support its personnel, and to continue with its expansion plans. Id., at 10-11, 43-44. These allegations leave little doubt that a primary purpose of this lawsuit is to prevent the Service from assessing and collecting income taxes from petitioner.
We recognize that petitioner's assertions that it will owe federal income taxes should its § 501 (c) (3) status be revoked are open to debate, because they are based in part on a failure to take into account possible deductions for depreciation of plant and equipment. Even if it could be shown, however, that petitioner would owe no federal income taxes if its § 501 (c) (3) status were *739 revoked, this would still be a suit to restrain the assessment or collection of taxes because petitioner would also be liable for FICA and FUTA taxes. Section 7421 (a) speaks of "any tax"; it does not differentiate between federal income taxes or FICA or FUTA taxes. See, e. g., Williams Packing, supra. Moreover, petitioner seeks to restrain the collection of taxes from its donorsto force the Service to continue to provide advance assurance to those donors that contributions to petitioner will be recognized as tax deductible, thereby reducing their tax liability. Although in this regard petitioner seeks to lower the taxes of those other than itself, the Act is nonetheless controlling.[10] Thus in any of its implications, this case falls within the literal scope and the purposes of the Act.
Petitioner further contends that the Service's actions do not represent an effort to protect the revenues but an attempt to regulate the admissions policies of private universities. Under this line of argument, the Anti-Injunction *740 Act is said to be inapplicable because the case does not truly involve taxes. We disagree.
The Service bases its present position with regard to the tax status of segregative private schools on its interpretation of the Code.[11] There is no evidence that that position does not represent a good-faith effort to enforce the technical requirements of the tax laws, and, without indicating a view as to whether the Service's interpretation is correct, we cannot say that its position has no legal basis or is unrelated to the protection of the revenues. The Act is therefore applicable. Petitioner's attribution of non-tax-related motives to the Service ignores the fact that petitioner has not shown that the Service's action is without an independent basis in the requirements of the Code. Moreover, petitioner's argument fails to give appropriate weight to Bailey v. George, 259 U.S. 16 (1922). In that case, the Court held that the Act blocked a pre-enforcement suit to enjoin collection of the federal Child Labor Tax, although the tax was challenged as a regulatory measure beyond the taxing power of Congress. Significantly, the Court announced Bailey v. George on the same day that it issued Bailey v. Drexel Furniture Co., 259 U.S. 20 *741 (1922), a tax-refund case in which the Court struck down the Child Labor Tax Law as unconstitutional on the grounds that the taxpayer attempted to raise prematurely in Bailey v. George.[12]
Petitioner also argues that § 7421 (a) is not controlling because when the Act was passed in 1867 Congress could not possibly have foreseen something as sophisticated as the comparatively recent ruling-letter program[13] and the special importance of that program for § 501 (c) (3) organizations. This argument proves too much, however, since the same Congress also could not have foreseen, for example, FICA or FUTA taxes, to which the prohibitory command of § 7421 (a) indisputably applies. See, e. g., Williams Packing, supra. Moreover, through the years Congress has repeatedly re-enacted the Anti-Injunction Act[14] at times when it was obviously aware of *742 the continuously increasing complexity of the federal tax system.[15]
B
Petitioner next argues that Enochs v. Williams Packing & Navigation Co., supra, does not constitute an all-encompassing reading of the Act. Petitioner contends, on the basis of prior precedents, that § 7421 (a) is subject to judicially created exceptions other than the "under no circumstances" test announced in Williams Packing. But the Court's unanimous opinion in Williams Packing indicates that the case was meant to be the capstone to judicial construction of the Act. It spells an end to a cyclical pattern of allegiance to the plain meaning of the Act, followed by periods of uncertainty caused by a judicial departure from that meaning, and followed in turn by the Court's rediscovery of the Act's purpose.
During the first half century of the Act's existence, the Court gave it literal force, without regard to the character of the tax, the nature of the pre-enforcement challenge to it, or the status of the plaintiff. See State Railroad Tax Cases, 92 U. S., at 613-614; Snyder v. Marks, 109 U.S. 189 (1883); Pacific Steam Whaling Co. v. United States, 187 U.S. 447 (1903); Dodge v. Osborn, 240 U.S. 118 (1916); Bailey v. George, 259 U.S. 16 (1922).[16] Occasionally, however, the Court noted in *743 dictum that unspecified extraordinary and exceptional circumstances might justify an injunction despite the Act. E. g., Dodge v. Osborn, supra, at 122; Bailey v. George, supra, at 20. In 1922, the Court seized upon these dicta and permitted pre-enforcement injunctive suits against tax statutes that were viewed as penalties or as adjuncts to the criminal law. Hill v. Wallace, 259 U.S. 44 (1922); Lipke v. Lederer, 259 U.S. 557 (1922); Regal Drug Corp. v. Wardell, 260 U.S. 386 (1922). Shortly thereafter, however, the Court made clear that Hill, Lipke, and Regal Drug were of narrow scope and had no application to pre-enforcement challenges to truly revenue-raising tax statutes. Graham v. Du Pont, 262 U.S. 234 (1923).[17] Thus, the Court's first departure from a literal reading of the Act produced a prompt correction in course.
*744 In the 1930's the Court decided Miller v. Standard Nut Margarine Co., 284 U.S. 498 (1932), and Allen v. Regents of the University System of Georgia, 304 U.S. 439 (1938), the cases relied on most heavily by petitioner. Standard Nut set forth a new definition of the extraordinary and exceptional circumstances test, which was followed in Regents. In Standard Nut the Court stated that the Act is merely "declaratory of the principle" of cases prior to its passage that equity usually, but not always, disavows interference with tax collection; thus, the Act was to be construed "as near as may be in harmony with [equity doctrine] and the reasons upon which it rests." 284 U.S., at 509. Through this interpretation, the concept of extraordinary and exceptional circumstances was reduced to the traditional equitable requirements for issuance of an injunction.
Standard Nut was such a significant deviation from precedent that it was referred to by a commentator at the time as "a tribute to the tenacity of the American taxpayer" and "little short of phenomenal."[18] Read literally, the Court's opinion effectively repealed the Act, since the Act was viewed as requiring nothing more than equity doctrine had demanded before the Act's passage. The incongruity of this position has not escaped notice.[19] It undoubtedly led directly to the Court's re-examination *745 of the requirements of the Act in Williams Packing, the second time the Court has undertaken to rehabilitate the Act following debilitating departures from its explicit language. See Graham v. Du Pont, supra.
Williams Packing switched the focus of the extraordinary and exceptional circumstances test from a showing of the degree of harm to the plaintiff absent an injunction to the requirement that it be established that the Service's action is plainly without a legal basis. The Court in essence read Standard Nut not as an instance of irreparable injury but as a case where the Service had no chance of success on the merits. 370 U.S., at 7. And the Court explicitly held that the Act may not be evaded "merely because collection would cause an irreparable injury, such as the ruination of the taxpayer's enterprise." Id., at 6. Yet petitioner's argument that we should find Williams Packing inapplicable turns, in the last analysis, on its claim that to do otherwise would subject it to great harm. The Court rejected that consideration in Williams Packing itself, and we reject it as a reason for finding that case not controlling. Under the language of the Act, the degree of harm is not a factor, and as a matter of judicial construction, it does not provide a meaningful stopping point between Standard Nut and Williams Packing. Acceptance of petitioner's irreparable injury argument would simply *746 revive the evisceration of the Act inherent in Standard Nut.
C
Assuming, arguendo, the applicability of § 7421 (a) and Williams Packing, petitioner contends that forcing it to meet the standards of those authorities will deny it due process of law in light of the irreparable injury it will suffer pending resort to alternative procedures for review and of the alleged inadequacies of those remedies at law. The Court dismissed out of hand similar contentions nearly 60 years ago,[20] and we find such arguments no more compelling now than then.
This is not a case in which an aggrieved party has no access at all to judicial review. Were that true, our conclusion might well be different. If, as alleged in its complaint, petitioner will have taxable income upon the withdrawal of its § 501 (c) (3) status, it may in accordance with prescribed procedures petition the Tax Court to review the assessment of income taxes. Alternatively, petitioner may pay income taxes, or, in their absence, an installment of FICA or FUTA taxes, exhaust the Service's internal refund procedures, and then bring suit for a refund. These review procedures offer petitioner a full, albeit delayed, opportunity to litigate the legality of the Service's revocation of tax-exempt status and withdrawal of advance assurance of deductibility. See, e. g., Christian Echoes National Ministry, Inc. v. United States, *747 470 F.2d 849 (CA10 1972), cert. denied, 414 U.S. 864 (1973); Center on Corporate Responsibility, Inc. v. Shultz, 368 F. Supp. 863 (DC 1973).[21]
We do not say that these avenues of review are the best that can be devised. They present serious problems of delay, during which the flow of donations to an organization will be impaired and in some cases perhaps even terminated. But, as the Service notes, some delay may be an inevitable consequence of the fact that disputes between the Service and a party challenging the Service's actions are not susceptible of instant resolution through litigation. And although the congressional restriction to postenforcement review may place an organization claiming tax-exempt status in a precarious financial position, the problems presented do not rise to the level of constitutional infirmities, in light of the powerful governmental interests in protecting the administration of the tax system from premature judicial interference, e. g., Cheatham v. United States, 92 U. S., at 88-89; State *748 Railroad Tax Cases, 92 U. S., at 613-614, and of the opportunities for review that are available.[22]
IV
Since we hold that Williams Packing, supra, governs this case, the remaining issue is whether petitioner has met the standards of that case. Without deciding the *749 merits, we think that petitioner's First Amendment, due process, and equal protection contentions are sufficiently debatable to foreclose any notion that "under no circumstances could the Government ultimately prevail. . . ." 370 U.S., at 7. See, e. g., Green v. Connally, 330 F. Supp. 1150 (DC), aff'd per curiam sub nom. Coit v. Green, 404 U.S. 997 (1971). Accordingly, the Court of Appeals did not err in holding that § 7421 (a) deprived the District Court of jurisdiction to issue the injunctive relief petitioner sought.
In holding that § 7421 (a) blocks the present suit, we are not unaware that Congress has imposed an especially harsh regime on § 501 (c) (3) organizations threatened with loss of tax-exempt status and with withdrawal of advance assurance of deductibility of contributions. A former Commissioner of the Internal Revenue Service has sharply criticized the system applicable to such organizations.[23] The degree of bureaucratic control *750 that, practically speaking, has been placed in the Service over those in petitioner's position is susceptible of abuse, regardless of how conscientiously the Service may attempt to carry out its responsibilities. Specific treatment of not-for-profit organizations to allow them to seek pre-enforcement review may well merit consideration. But this matter is for Congress, which is the appropriate body to weigh the relevant, policy-laden considerations, such as the harshness of the present law, the consequences of an unjustified revocation of § 501 (c) (3) status, the number of organizations in any year threatened with such revocation, the comparability of those organizations to others which rely on the Service's ruling-letter program, and the litigation burden on the Service and the effect on the assessment and collection of federal taxes if the law were to be changed.
The judgment is affirmed.
It is so ordered.
MR. JUSTICE DOUGLAS took no part in the decision of this case.
MR. JUSTICE BLACKMUN, concurring in the result.
I concur in the Court's judgment and agree with much of the reasoning in its opinion for this case. As the Court notes, ante, at 738, the University's obtaining an injunction would directly prevent the collection of what it says are $750,000 in income taxes for 1971 and of over $500,000 for 1972. On the basis of this fact alone, the "purpose" of the suit is indeed to restrain "the *751 assessment or collection of [a] tax," and brings 26 U.S. C. § 7421 (a) into play.
Since the anti-injunction statute is applicable, we must consider whether the University comes within the statute's exception recognized in Enochs v. Williams Packing & Navigation Co., 370 U.S. 1 (1962). As to this, I join Part IV of the Court's opinion to the effect that it has not been shown that "under no circumstances could the Government ultimately prevail." Id., at 7.
| This case and Commissioner v "Americans United" Inc, post, p 752, involve the application of the Anti-Injunction *727 Act, 7421 (a) of the Internal Revenue Code of 1954 (the Code), 26 US C 7421 (a), to the ruling-letter program of the Internal Revenue Service (the Service) for organizations claiming tax-exempt status under Code 501 (c) (3), 26 US C 501 (c) (3) The question presented is whether, prior to the assessment and collection of any tax, a court may enjoin the Service from revoking a ruling letter declaring that petitioner qualifies for tax-exempt status and from withdrawing advance assurance to donors that contributions to petitioner will constitute charitable deductions under Code 170 (c) (2), 26 US C 170 (c) (2) We hold that it may not I Section 501 (a) of the Code exempts from federal income taxes organizations described in 501 (c) (3) The latter provision encompasses: "Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation, and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of any candidate for public office" Section 501 (c) (3) organizations are also exempt from federal social security (FICA) taxes by virtue of Code 3121 (b) (8) (B), 26 US C 3121 (b) (8) (B), and from federal unemployment (FUTA) taxes by virtue of 3306 (c) (8), 26 US C 3306 (c) (8) Donations *728 to 501 (c) (3) organizations are tax deductible under 170 (c) (2)[1] As a practical matter, an organization hoping to solicit tax-deductible contributions may not rely solely on technical compliance with the language of 501 (c) (3) and 170 (c) (2) The organization must also obtain a ruling letter from the Service, pursuant to Rev Procs 72-3 and 72-4, -1 Cum Bull 698, 706, declaring that it qualifies under 501 (c) (3) Receipt of such a ruling letter leads, in the ordinary case, to inclusion in *729 the Service's periodically updated Publication No 78, "Cumulative List of Organizations described in Section 170 (c) of the Internal Revenue Code of 1954" (the Cumulative List) In essence, the Cumulative List is the Service's official roster of tax-exempt organizations: "The listing of an organization in [the Cumulative List] signifies it has received a ruling or determination letter stating that contributions by donors to the organization are deductible as provided in section 170 of the Code" Rev Proc 72-39, -2 Cum Bull 818 An organization's inclusion in the Cumulative List assures potential donors in advance that contributions to the organization will qualify as charitable deductions under 170 (c) (2) The Service has announced that, with narrowly limited exceptions, a donor may rely on the Cumulative List for so long as the beneficiaries of his largesse maintain their listing, regardless of their actual tax status[2] For this reason, appearance on the Cumulative List is a prerequisite to successful fund raising *730 for most charitable organizations Many contributors simply will not make donations to an organization that does not appear on the Cumulative List[3] Because of the importance of inclusion in the Cumulative List, revocation of a 501 (c) (3) ruling letter and consequent removal from the Cumulative List is likely to result in serious damage to a charitable organization[4] Revocation not only threatens the flow of contributions, it also subjects the affected organization to FICA and FUTA taxes and, assuming that the organization has taxable income and does not qualify as tax exempt under another subsection of 501, to federal income taxes[5] Upon the assessment and attempted collection of income taxes, the organization may litigate the legality of the Service's action by petitioning the Tax Court to review a notice of deficiency See Code 6212 and 6213, 26 US C 6212 and 6213 Or, following the collection of any federal tax and the denial of a refund by the Service, the organization may bring a *731 refund suit in a federal district court or in the Court of Claims See Code 7422, 26 US C 7422; 28 US C 1346 (a) (1) and 1491 Finally, a donor to the organization may bring a refund suit to challenge the denial of a charitable deduction under 170 (c) (2) Presumably such a "friendly donor" would be able to attack the legality of the Service's revocation of an organization's 501 (c) (3) status But these post-revocation avenues of review take substantial time, during which the organization is certain to lose contributions from those donors whose gifts are contingent on entitlement to charitable deductions under 170 (c) (2) Accordingly, any organization threatened with revocation of a 501 (c) (3) ruling letter has a powerful incentive to bring a pre-enforcement suit to prevent the Service from taking action in the first instance The pressures operating on organizations facing revocation of 501 (c) (3) status to seek injunctive relief against the Service pending judicial review of the proposed action conflict directly with a congressional prohibition of such pre-enforcement tax suits In force continuously since its enactment in 1867, the Anti-Injunction Act, now Code 7421 (a), provides in pertinent part that "no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court "[6] Because an injunction *732 preventing the Service from withdrawing a 501 (c) (3) ruling letter would necessarily preclude the collection of FICA, FUTA, and possibly income taxes from the affected organization, as well as the denial of 170 (c) (2) charitable deductions to donors to the organization, a suit seeking such relief falls squarely within the literal scope of the Act[7] *733 The clash between the language of the Anti-Injunction Act and the desire of 501 (c) (3) organizations to block the Service from withdrawing a ruling letter has been resolved against the organizations in most cases E g, *734 Crenshaw County Private School pet for cert pending in No 73-170; National Council on the Facts of ; Israelite House of [8] But see Cf (DC), aff'd per curiam sub nom In the present case, the Court of Appeals for the Fourth Circuit followed the majority view Bob Jones In light of the contrary result reached by the Court of Appeals for the District of Columbia Circuit in "Americans United" rev'd sub nom Commissioner v "Americans United" Inc, post, p 752, we granted Bob Jones University's petition for certiorari II Petitioner refers to itself as "the world's most unusual university" Founded in 1927 and now located in Greenville, South Carolina, the University is devoted to the teaching and propagation of its fundamentalist religious beliefs All classes commence and close with prayer, *735 and courses in religion are compulsory Students and faculty are screened for adherence to certain religious precepts and may be expelled or dismissed for lack of allegiance to them One of these beliefs is that God intended segregation of the races and that the Scriptures forbid interracial marriage Accordingly, petitioner refuses to admit Negroes as students On pain of expulsion students are prohibited from interracial dating, and petitioner believes that it would be impossible to enforce this prohibition absent the exclusion of Negroes In 1942, the Service issued petitioner a ruling letter under 101 (6) of the Internal Revenue Code of 1939, the predecessor of 501 (c) (3) In 1970, however, the Service announced that it would no longer allow 501 (c) (3) status for private schools maintaining racially discriminatory admissions policies and that it would no longer treat contributions to such schools as tax deductible See Rev Rul 71-447, -2 Cum Bull 230 The Service requested proof of a nondiscriminatory admissions policy from all such schools and warned that tax-exempt ruling letters would be reviewed in light of the information provided At the end of 1970, petitioner advised the Service that it did not admit Negroes, and in September further stated that it had no intention of altering this policy The Commissioner of Internal Revenue therefore instructed the District Director to commence administrative procedures leading to the revocation of petitioner's 501 (c) (3) ruling letter Petitioner brought these administrative proceedings to a halt by filing suit in the United District Court for the District of South Carolina for preliminary and permanent injunctive relief preventing the Service from revoking or threatening to revoke petitioner's tax-exempt status Petitioner alleged irreparable injury in the form of substantial federal income tax liability and the loss of *736 contributions Petitioner asserted that the Service's threatened action was outside its lawful authority and would violate petitioner's rights to the free exercise of religion, to free association, and to due process and equal protection of the laws The District Court rejected a motion to dismiss for lack of jurisdiction, and it preliminarily enjoined the Service from revoking or threatening to revoke petitioner's tax-exempt status and from withdrawing advance assurance of the deductibility of contributions made to petitioner Bob Jones The Court of Appeals for the Fourth Circuit reversed, with one judge dissenting reh den, That court held that petitioner's suit was barred by the Anti-Injunction Act as interpreted by this Court in III The Anti-Injunction Act apparently has no recorded legislative history,[9] but its language could scarcely be more explicit"no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court " The Court has interpreted the principal purpose of this language to be the protection of the Government's need to assess and collect taxes as expeditiously as possible with a minimum of pre-enforcement judicial interference, "and to require that the legal right to the disputed sums be determined in a suit for refund" Enochs v Williams & Navigation *737 Co, See also, e g, State Railroad Tax 92 US 575, Cf Cheatham v United 92 US 85, The Court has also identified "a collateral objective of the Actprotection of the collector from litigation pending a suit for refund" Williams -8 In furtherance of these goals, the Court in its most recent reading gave the Act almost literal effect In Williams an employer sought to enjoin the collection of FICA and FUTA taxes that the employer alleged were not owed and would destroy its business The Court held unanimously that the suit was barred by the Act Only upon proof of the presence of two factors could the literal terms of 7421 (a) be avoided: first, irreparable injury, the essential prerequisite for injunctive relief in any case; and second, certainty of success on the merits Id, An injunction could issue only "if it is clear that under no circumstances could the Government ultimately prevail " Id, And this determination would be made on the basis of the information available to the Government at the time of the suit "Only if it is then apparent that, under the most liberal view of the law and the facts, the United cannot establish its claim, may the suit for an injunction be maintained" Ibid Perhaps in recognition of the stringent nature of the Williams standard and its implications for this case, petitioner makes little effort to argue that it can meet that test Rather, it asserts that the Anti-Injunction Act, properly construed, is not applicable, that Williams is not the controlling reading of the Act, and that rejection of both these contentions would work a denial of due process of law We find these arguments unpersuasive *738 A First, petitioner contends that the Act is inapplicable because this is not a suit "for the purpose of restraining the assessment or collection of any tax " Under petitioner's theory, its suit is intended solely to compel the Service to refrain from withdrawing petitioner's 501 (c) (3) ruling letter and from depriving petitioner's donors of advance assurance of deductibility Petitioner describes its goal as the maintenance of the flow of contributions, not the obstruction of revenue Petitioner's complaint and supporting documents filed in the District Court belie any notion that this is not a suit to enjoin the assessment or collection of federal taxes from petitioner In support of its claim of irreparable injury, petitioner alleged in part that it would be subject to "substantial" federal income tax liability if the Service were allowed to carry out its threatened action App 6 Petitioner buttressed this contention with sworn affidavits alleging federal income tax liability of three-quarters of a million dollars for one year and in excess of half a million dollars for another and stressing the detrimental effect such tax liability would have on petitioner's capacity to operate its institution, to support its personnel, and to continue with its expansion plans Id, These allegations leave little doubt that a primary purpose of this lawsuit is to prevent the Service from assessing and collecting income taxes from petitioner We recognize that petitioner's assertions that it will owe federal income taxes should its 501 (c) (3) status be revoked are open to debate, because they are based in part on a failure to take into account possible deductions for depreciation of plant and equipment Even if it could be shown, however, that petitioner would owe no federal income taxes if its 501 (c) (3) status were *739 revoked, this would still be a suit to restrain the assessment or collection of taxes because petitioner would also be liable for FICA and FUTA taxes Section 7421 (a) speaks of "any tax"; it does not differentiate between federal income taxes or FICA or FUTA taxes See, e g, Williams supra Moreover, petitioner seeks to restrain the collection of taxes from its donorsto force the Service to continue to provide advance assurance to those donors that contributions to petitioner will be recognized as tax deductible, thereby reducing their tax liability Although in this regard petitioner seeks to lower the taxes of those other than itself, the Act is nonetheless controlling[10] Thus in any of its implications, this case falls within the literal scope and the purposes of the Act Petitioner further contends that the Service's actions do not represent an effort to protect the revenues but an attempt to regulate the admissions policies of private universities Under this line of argument, the Anti-Injunction *740 Act is said to be inapplicable because the case does not truly involve taxes We disagree The Service bases its present position with regard to the tax status of segregative private schools on its interpretation of the Code[11] There is no evidence that that position does not represent a good-faith effort to enforce the technical requirements of the tax laws, and, without indicating a view as to whether the Service's interpretation is correct, we cannot say that its position has no legal basis or is unrelated to the protection of the revenues The Act is therefore applicable Petitioner's attribution of non-tax-related motives to the Service ignores the fact that petitioner has not shown that the Service's action is without an independent basis in the requirements of the Code Moreover, petitioner's argument fails to give appropriate weight to Bailey v 259 US 16 In that case, the Court held that the Act blocked a pre-enforcement suit to enjoin collection of the federal Child Labor Tax, although the tax was challenged as a regulatory measure beyond the taxing power of Congress Significantly, the Court announced Bailey v on the same day that it issued Bailey v Drexel Furniture Co, 259 US 20 a tax-refund case in which the Court struck down the Child Labor Tax Law as unconstitutional on the grounds that the taxpayer attempted to raise prematurely in Bailey v [12] Petitioner also argues that 7421 (a) is not controlling because when the Act was passed in 1867 Congress could not possibly have foreseen something as sophisticated as the comparatively recent ruling-letter program[13] and the special importance of that program for 501 (c) (3) organizations This argument proves too much, however, since the same Congress also could not have foreseen, for example, FICA or FUTA taxes, to which the prohibitory command of 7421 (a) indisputably applies See, e g, Williams supra Moreover, through the years Congress has repeatedly re-enacted the Anti-Injunction Act[14] at times when it was obviously aware of *742 the continuously increasing complexity of the federal tax system[15] B Petitioner next argues that does not constitute an all-encompassing reading of the Act Petitioner contends, on the basis of prior precedents, that 7421 (a) is subject to judicially created exceptions other than the "under no circumstances" test announced in Williams But the Court's unanimous opinion in Williams indicates that the case was meant to be the capstone to judicial construction of the Act It spells an end to a cyclical pattern of allegiance to the plain meaning of the Act, followed by periods of uncertainty caused by a judicial departure from that meaning, and followed in turn by the Court's rediscovery of the Act's purpose During the first half century of the Act's existence, the Court gave it literal force, without regard to the character of the tax, the nature of the pre-enforcement challenge to it, or the status of the plaintiff See State Railroad Tax 92 U S, at ; Snyder v Marks, 109 US 189 ; Pacific Steam Whaling Co v United 187 US 447 ; Dodge v 240 US 118 ; Bailey v 259 US 16 [16] Occasionally, however, the Court noted in *743 dictum that unspecified extraordinary and exceptional circumstances might justify an injunction despite the Act E g, Dodge v ; Bailey v In 1922, the Court seized upon these dicta and permitted pre-enforcement injunctive suits against tax statutes that were viewed as penalties or as adjuncts to the criminal law Hill v Wallace, 259 US 44 ; Lipke v Lederer, 259 US 557 ; Regal Drug Corp v Wardell, 260 US 386 Shortly thereafter, however, the Court made clear that Hill, Lipke, and Regal Drug were of narrow scope and had no application to pre-enforcement challenges to truly revenue-raising tax statutes Graham v Du 262 US 234 [17] Thus, the Court's first departure from a literal reading of the Act produced a prompt correction in course *744 In the 1930's the Court decided Miller v Standard Nut Margarine Co, 284 US 498 and Allen v Regents of the University System of Georgia, 304 US 439 the cases relied on most heavily by petitioner Standard Nut set forth a new definition of the extraordinary and exceptional circumstances test, which was followed in Regents In Standard Nut the Court stated that the Act is merely "declaratory of the principle" of cases prior to its passage that equity usually, but not always, disavows interference with tax collection; thus, the Act was to be construed "as near as may be in harmony with [equity doctrine] and the reasons upon which it rests" 284 US, at 509 Through this interpretation, the concept of extraordinary and exceptional circumstances was reduced to the traditional equitable requirements for issuance of an injunction Standard Nut was such a significant deviation from precedent that it was referred to by a commentator at the time as "a tribute to the tenacity of the American taxpayer" and "little short of phenomenal"[18] Read literally, the Court's opinion effectively repealed the Act, since the Act was viewed as requiring nothing more than equity doctrine had demanded before the Act's passage The incongruity of this position has not escaped notice[19] It undoubtedly led directly to the Court's re-examination *745 of the requirements of the Act in Williams the second time the Court has undertaken to rehabilitate the Act following debilitating departures from its explicit language See Graham v Du supra Williams switched the focus of the extraordinary and exceptional circumstances test from a showing of the degree of harm to the plaintiff absent an injunction to the requirement that it be established that the Service's action is plainly without a legal basis The Court in essence read Standard Nut not as an instance of irreparable injury but as a case where the Service had no chance of success on the merits 370 US, And the Court explicitly held that the Act may not be evaded "merely because collection would cause an irreparable injury, such as the ruination of the taxpayer's enterprise" Id, Yet petitioner's argument that we should find Williams inapplicable turns, in the last analysis, on its claim that to do otherwise would subject it to great harm The Court rejected that consideration in Williams itself, and we reject it as a reason for finding that case not controlling Under the language of the Act, the degree of harm is not a factor, and as a matter of judicial construction, it does not provide a meaningful stopping point between Standard Nut and Williams Acceptance of petitioner's irreparable injury argument would simply *746 revive the evisceration of the Act inherent in Standard Nut C Assuming, arguendo, the applicability of 7421 (a) and Williams petitioner contends that forcing it to meet the standards of those authorities will deny it due process of law in light of the irreparable injury it will suffer pending resort to alternative procedures for review and of the alleged inadequacies of those remedies at law The Court dismissed out of hand similar contentions nearly 60 years ago,[20] and we find such arguments no more compelling now than then This is not a case in which an aggrieved party has no access at all to judicial review Were that true, our conclusion might well be different If, as alleged in its complaint, petitioner will have taxable income upon the withdrawal of its 501 (c) (3) status, it may in accordance with prescribed procedures petition the Tax Court to review the assessment of income taxes Alternatively, petitioner may pay income taxes, or, in their absence, an installment of FICA or FUTA taxes, exhaust the Service's internal refund procedures, and then bring suit for a refund These review procedures offer petitioner a full, albeit delayed, opportunity to litigate the legality of the Service's revocation of tax-exempt status and withdrawal of advance assurance of deductibility See, e g, Christian Echoes National Ministry, Inc v United *747 470 F2d 849 cert denied, 414 US 864 ; Center on Corporate Responsibility, Inc v Shultz, 368 F Supp 863 [21] We do not say that these avenues of review are the best that can be devised They present serious problems of delay, during which the flow of donations to an organization will be impaired and in some cases perhaps even terminated But, as the Service notes, some delay may be an inevitable consequence of the fact that disputes between the Service and a party challenging the Service's actions are not susceptible of instant resolution through litigation And although the congressional restriction to postenforcement review may place an organization claiming tax-exempt status in a precarious financial position, the problems presented do not rise to the level of constitutional infirmities, in light of the powerful governmental interests in protecting the administration of the tax system from premature judicial interference, e g, Cheatham v United 92 U S, at ; State *748 Railroad Tax 92 U S, at and of the opportunities for review that are available[22] IV Since we hold that Williams governs this case, the remaining issue is whether petitioner has met the standards of that case Without deciding the *749 merits, we think that petitioner's First Amendment, due process, and equal protection contentions are sufficiently debatable to foreclose any notion that "under no circumstances could the Government ultimately prevail " 370 US, See, e g, (DC), aff'd per curiam sub nom Accordingly, the Court of Appeals did not err in holding that 7421 (a) deprived the District Court of jurisdiction to issue the injunctive relief petitioner sought In holding that 7421 (a) blocks the present suit, we are not unaware that Congress has imposed an especially harsh regime on 501 (c) (3) organizations threatened with loss of tax-exempt status and with withdrawal of advance assurance of deductibility of contributions A former Commissioner of the Internal Revenue Service has sharply criticized the system applicable to such organizations[23] The degree of bureaucratic control *750 that, practically speaking, has been placed in the Service over those in petitioner's position is susceptible of abuse, regardless of how conscientiously the Service may attempt to carry out its responsibilities Specific treatment of not-for-profit organizations to allow them to seek pre-enforcement review may well merit consideration But this matter is for Congress, which is the appropriate body to weigh the relevant, policy-laden considerations, such as the harshness of the present law, the consequences of an unjustified revocation of 501 (c) (3) status, the number of organizations in any year threatened with such revocation, the comparability of those organizations to others which rely on the Service's ruling-letter program, and the litigation burden on the Service and the effect on the assessment and collection of federal taxes if the law were to be changed The judgment is affirmed It is so ordered MR JUSTICE DOUGLAS took no part in the decision of this case MR JUSTICE BLACKMUN, concurring in the result I concur in the Court's judgment and agree with much of the reasoning in its opinion for this case As the Court notes, ante, 38, the University's obtaining an injunction would directly prevent the collection of what it says are $750,000 in income taxes for and of over $500,000 for On the basis of this fact alone, the "purpose" of the suit is indeed to restrain "the *751 assessment or collection of [a] tax," and brings 26 US C 7421 (a) into play Since the anti-injunction statute is applicable, we must consider whether the University comes within the statute's exception recognized in As to this, I join Part IV of the Court's opinion to the effect that it has not been shown that "under no circumstances could the Government ultimately prevail" Id, |
Justice O'Connor | concurring | false | Ramdass v. Angelone | 2000-06-12T00:00:00 | null | https://www.courtlistener.com/opinion/118374/ramdass-v-angelone/ | https://www.courtlistener.com/api/rest/v3/clusters/118374/ | 2,000 | 1999-073 | 1 | 5 | 4 | In Simmons v. South Carolina, 512 U.S. 154 (1994), a majority of the Court held that "[w]here the State puts the defendant's future dangerousness in issue, and the only available alternative sentence to death is life imprisonment without possibility of parole, due process entitles the defendant *179 to inform the capital sentencing jury . . . that he is parole ineligible." Id., at 178 (O'Connor, J., concurring in judgment); see also id., at 163-164 (plurality opinion). Due process requires that "a defendant not be sentenced to death `on the basis of information which he had no opportunity to deny or explain.' " Id., at 175 (O'Connor, J., concurring in judgment) (quoting Skipper v. South Carolina, 476 U.S. 1, 5, n. 1 (1986)). Accordingly, where the State seeks to demonstrate that the defendant poses a future danger to society, he "should be allowed to bring his parole ineligibility to the jury's attention" as a means of rebutting the State's case. 512 U.S., at 177. I have no doubt that Simmons was rightly decided.
In this case, because petitioner seeks a writ of habeas corpus rather than the vacatur of his sentence on direct appeal, the scope of our review is governed by 28 U.S. C. § 2254(d)(1) (1994 ed., Supp. III). Accordingly, we may grant relief only if the Virginia Supreme Court's decision "was contrary to, or involved an unreasonable application of, clearly established Federal law, as determined by the Supreme Court of the United States," ibid.; see also Williams v. Taylor, 529 U.S. 362, 402-409 (2000), which in this case is our holding in Simmons.
The Virginia Supreme Court concluded that Simmons was inapplicable because petitioner "was not ineligible for parole when the jury was considering his sentence." Ramdass v. Commonwealth, 248 Va. 518, 521, 450 S.E.2d 360, 361 (1994). The court noted that, under Virginia law, any person who has been convicted of three separate felony offenses of murder, rape, or robbery "by the presenting of firearms or other deadly weapon" "shall not be eligible for parole." Va. Code Ann. § 53.1-151(B1) (1993). It explained that Ramdass was not parole ineligible at the time of his capital sentencing proceeding because the Kayani murder conviction would not constitute his third conviction for purposes of § 53.1-151(B1). Critically, the court held that, although Ramdass had been *180 found guilty of the armed robbery of a Domino's Pizza restaurant, that verdict did not count as a prior conviction under § 53.1-151(B1) because judgment had not yet been entered on that verdict at the time of Ramdass' capital sentencing proceeding. 248 Va., at 520, 450 S. E. 2d, at 361.
For the reasons explained in the plurality opinion, the Virginia Supreme Court's decision was neither contrary to, nor an unreasonable application of, our holding in Simmons. Whether a defendant is entitled to inform the jury that he is parole ineligible is ultimately a question of federal law, but we look to state law to determine a defendant's parole status. In Simmons, the defendant had "conclusively establish[ed]" that he was parole ineligible at the time of sentencing, and the "prosecution did not challenge or question [his] parole ineligibility." 512 U.S., at 158. Ramdass, however, was not ineligible for parole when the jury considered his sentence as the relevant court had not yet entered the judgment of conviction for the Domino's Pizza robbery. Were the entry of judgment a purely ministerial act under Virginia law, in the sense that it was foreordained, I would agree with petitioner that "the only available alternative sentence to death [was] life imprisonment without possibility of parole." Id., at 178 (O'Connor, J., concurring in judgment). Such circumstances would be "materially indistinguishable" from the facts of Simmons. See Williams v. Taylor, 529 U. S., at 405. It therefore would have been "contrary to" Simmons for the Virginia Supreme Court to hold that petitioner was not entitled to inform the jury that he would be parole ineligible. See ibid. Where all that stands between a defendant and parole ineligibility under state law is a purely ministerial act, Simmons entitles the defendant to inform the jury of that ineligibility, either by argument or instruction, even if he is not technically "parole ineligible" at the moment of sentencing.
Such was not the case here, however. As the plurality opinion explains, the entry of judgment following a criminal *181 conviction in Virginia state court is not a purely ministerial act, i. e., one that is inevitable and foreordained under state law. The Commonwealth allows criminal defendants to file post-trial motions following a guilty verdict, and trial courts may set aside jury verdicts in response to such motions. See ante, at 173-175. Thus, as a matter of Virginia law, a guilty verdict does not inevitably lead to the entry of a judgment order. Consequently, the jury verdict finding petitioner guilty of the Domino's Pizza robbery did not mean that petitioner would necessarily be parole ineligible under state law. Indeed, petitioner himself concedes that there was a "possibility that the Domino's Pizza trial judge could set aside the verdict under Virginia Supreme Court Rule 3A:15(b)." Brief for Petitioner 37.
Petitioner nevertheless contends that the possibility that the trial court would set aside the guilty verdict for the Domino's Pizza robbery was quite remote, and therefore that the entry of judgment was extremely likely. But, as the plurality opinion explains, Simmons does not require courts to estimate the likelihood of future contingencies concerning the defendant's parole ineligibility. Rather, Simmons entitles the defendant to inform the capital sentencing jury that he is parole ineligible where the only alternative sentence to death is life without the possibility of parole. And unlike the defendant in Simmons, Ramdass was eligible for parole under state law at the time of his sentencing.
For these reasons, I agree that petitioner is not entitled to the issuance of a writ of habeas corpus. As our decision in Williams v. Taylor makes clear, the standard of review dictated by 28 U.S. C. § 2254(d)(1) (1994 ed., Supp. III) is narrower than that applicable on direct review. Applying that standard here, I believe the Virginia Supreme Court's decision was neither contrary to, nor an unreasonable application of, our holding in Simmons. Accordingly, I concur in the judgment. | In a majority of the Court held that "[w]here the State puts the defendant's future dangerousness in issue, and the only available alternative sentence to death is life imprisonment without possibility of parole, due process entitles the defendant *179 to inform the capital sentencing jury that he is parole ineligible." ; see also Due process requires that "a defendant not be sentenced to death `on the basis of information which he had no opportunity to deny or explain.' " ). Accordingly, where the State seeks to demonstrate that the defendant poses a future danger to society, he "should be allowed to bring his parole ineligibility to the jury's attention" as a means of rebutting the State's I have no doubt that Simmons was rightly decided. In this case, because petitioner seeks a writ of habeas corpus rather than the vacatur of his sentence on direct appeal, the scope of our review is governed by 28 U.S. C. 2254(d)(1) ( ed., Supp. III). Accordingly, we may grant relief only if the Virginia Supreme Court's decision "was contrary to, or involved an unreasonable application of, clearly established Federal law, as determined by the Supreme Court of the United States," ; see also which in this case is our holding in Simmons. The Virginia Supreme Court concluded that Simmons was inapplicable because petitioner "was not ineligible for parole when the jury was considering his sentence." The court noted that, under Virginia law, any person who has been convicted of three separate felony offenses of murder, rape, or robbery "by the presenting of firearms or other deadly weapon" "shall not be eligible for parole." Va. Code Ann. 53.1-151(B1) (1993). It explained that Ramdass was not parole ineligible at the time of his capital sentencing proceeding because the Kayani murder conviction would not constitute his third conviction for purposes of 53.1-151(B1). Critically, the court held that, although Ramdass had been *180 found guilty of the armed robbery of a Domino's Pizza restaurant, that verdict did not count as a prior conviction under 53.1-151(B1) because judgment had not yet been entered on that verdict at the time of Ramdass' capital sentencing 450 S. E. 2d, at For the reasons explained in the plurality opinion, the Virginia Supreme Court's decision was neither contrary to, nor an unreasonable application of, our holding in Simmons. Whether a defendant is entitled to inform the jury that he is parole ineligible is ultimately a question of federal law, but we look to state law to determine a defendant's parole status. In Simmons, the defendant had "conclusively establish[ed]" that he was parole ineligible at the time of sentencing, and the "prosecution did not challenge or question [his] parole ineligibility." Ramdass, however, was not ineligible for parole when the jury considered his sentence as the relevant court had not yet entered the judgment of conviction for the Domino's Pizza robbery. Were the entry of judgment a purely ministerial act under Virginia law, in the sense that it was foreordained, I would agree with petitioner that "the only available alternative sentence to death [was] life imprisonment without possibility of parole." Such circumstances would be "materially indistinguishable" from the facts of Simmons. See It therefore would have been "contrary to" Simmons for the Virginia Supreme Court to hold that petitioner was not entitled to inform the jury that he would be parole ineligible. See Where all that stands between a defendant and parole ineligibility under state law is a purely ministerial act, Simmons entitles the defendant to inform the jury of that ineligibility, either by argument or instruction, even if he is not technically "parole ineligible" at the moment of sentencing. Such was not the case here, however. As the plurality opinion explains, the entry of judgment following a criminal *181 conviction in Virginia state court is not a purely ministerial act, i. e., one that is inevitable and foreordained under state law. The Commonwealth allows criminal defendants to file post-trial motions following a guilty verdict, and trial courts may set aside jury verdicts in response to such motions. See ante, at 173-175. Thus, as a matter of Virginia law, a guilty verdict does not inevitably lead to the entry of a judgment order. Consequently, the jury verdict finding petitioner guilty of the Domino's Pizza robbery did not mean that petitioner would necessarily be parole ineligible under state law. Indeed, petitioner himself concedes that there was a "possibility that the Domino's Pizza trial judge could set aside the verdict under Virginia Supreme Court Rule 3A:15(b)." Brief for Petitioner 37. Petitioner nevertheless contends that the possibility that the trial court would set aside the guilty verdict for the Domino's Pizza robbery was quite remote, and therefore that the entry of judgment was extremely likely. But, as the plurality opinion explains, Simmons does not require courts to estimate the likelihood of future contingencies concerning the defendant's parole ineligibility. Rather, Simmons entitles the defendant to inform the capital sentencing jury that he is parole ineligible where the only alternative sentence to death is life without the possibility of parole. And unlike the defendant in Simmons, Ramdass was eligible for parole under state law at the time of his sentencing. For these reasons, I agree that petitioner is not entitled to the issuance of a writ of habeas corpus. As our decision in makes clear, the standard of review dictated by 28 U.S. C. 2254(d)(1) ( ed., Supp. III) is narrower than that applicable on direct review. Applying that standard here, I believe the Virginia Supreme Court's decision was neither contrary to, nor an unreasonable application of, our holding in Simmons. Accordingly, I concur in the judgment. |
Justice Marshall | majority | false | Merrion v. Jicarilla Apache Tribe | 1982-01-25T00:00:00 | null | https://www.courtlistener.com/opinion/110643/merrion-v-jicarilla-apache-tribe/ | https://www.courtlistener.com/api/rest/v3/clusters/110643/ | 1,982 | 1981-036 | 2 | 6 | 3 | Pursuant to long-term leases with the Jicarilla Apache Tribe, petitioners, 21 lessees, extract and produce oil and gas from the Tribe's reservation lands. In these two consolidated cases, petitioners challenge an ordinance enacted by the Tribe imposing a severance tax on "any oil and natural gas severed, saved and removed from Tribal lands." See Oil and Gas Severance Tax No. 77-0-02, App. 38. We granted certiorari to determine whether the Tribe has the authority to impose this tax, and, if so, whether the tax imposed by the Tribe violates the Commerce Clause.
I
The Jicarilla Apache Tribe resides on a reservation in northwestern New Mexico. Established by Executive Order in 1887,[1] the reservation contains 742,315 acres, all of which are held as tribal trust property. The 1887 Executive *134 Order set aside public lands in the Territory of New Mexico for the use and occupation of the Jicarilla Apache Indians, and contained no special restrictions except for a provision protecting pre-existing rights of bona fide settlers.[2] Approximately 2,100 individuals live on the reservation, with the majority residing in the town of Dulce, N. M., near the Colorado border.
The Tribe is organized under the Indian Reorganization Act of 1934, ch. 576, 48 Stat. 984, 25 U.S. C. ง 461 et seq., which authorizes any tribe residing on a reservation to adopt a constitution and bylaws, subject to the approval of the Secretary of the Interior (Secretary).[3] The Tribe's first Constitution, approved by the Secretary on August 4, 1937, preserved all powers conferred by ง 16 of the Indian Reorganization Act of 1934, ch. 576, 48 Stat. 987, 25 U.S. C. ง 476. In 1968, the Tribe revised its Constitution to specify:
"The inherent powers of the Jicarilla Apache Tribe, including those conferred by Section 16 of the Act of June 18, 1934 (48 Stat. 984), as amended, shall vest in the tribal council and shall be exercised thereby subject only to limitations imposed by the Constitution of the United States, applicable Federal statutes and regulations of *135 the Department of the Interior, and the restrictions established by this revised constitution." Revised Constitution of the Jicarilla Apache Tribe, Art. XI, ง 1.
The Revised Constitution provides that "[t]he tribal council may enact ordinances to govern the development of tribal lands and other resources," Art. XI, ง 1(a)(3). It further provides that "[t]he tribal council may levy and collect taxes and fees on tribal members, and may enact ordinances, subject to approval by the Secretary of the Interior, to impose taxes and fees on non-members of the tribe doing business on the reservation," Art. XI, ง 1(e). The Revised Constitution was approved by the Secretary on February 13, 1969.
To develop tribal lands, the Tribe has executed mineral leases encompassing some 69% of the reservation land. Beginning in 1953, the petitioners entered into leases with the Tribe. The Commissioner of Indian Affairs, on behalf of the Secretary, approved these leases, as required by the Act of May 11, 1938, ch. 198, 52 Stat. 347, 25 U.S. C. งง 396a-396g (1938 Act). In exchange for a cash bonus, royalties, and rents, the typical lease grants the lessee "the exclusive right and privilege to drill for, mine, extract, remove, and dispose of all the oil and natural gas deposits in or under" the leased land for as long as the minerals are produced in paying quantities. App. 22. Petitioners may use oil and gas in developing the lease without incurring the royalty. Id., at 24. In addition, the Tribe reserves the rights to use gas without charge for any of its buildings on the leased land, and to take its royalties in kind. Id., at 27-28. Petitioners' activities on the leased land have been subject to taxes imposed by the State of New Mexico on oil and gas severance and on oil and gas production equipment. Id., at 129. See Act of Mar. 3, 1927, ch. 299, ง 3, 44 Stat. 1347, 25 U.S. C. ง 398c (permitting state taxation of mineral production on Indian reservations) (1927 Act).
Pursuant to its Revised Constitution, the Tribal Council adopted an ordinance imposing a severance tax on oil and gas *136 production on tribal land. See App. 38. The ordinance was approved by the Secretary, through the Acting Director of the Bureau of Indian Affairs, on December 23, 1976. The tax applies to "any oil and natural gas severed, saved and removed from Tribal lands . . . ." Ibid. The tax is assessed at the wellhead at $0.05 per million Btu's of gas produced and $0.29 per barrel of crude oil or condensate produced on the reservation, and it is due at the time of severance. Id., at 38-39. Oil and gas consumed by the lessees to develop their leases or received by the Tribe as in-kind royalty payments are exempted from the tax. Ibid.; Brief for Respondent Jicarilla Apache Tribe 59, n. 42.
In two separate actions, petitioners sought to enjoin enforcement of the tax by either the tribal authorities or the Secretary. The United States District Court for the District of New Mexico consolidated the cases, granted other lessees leave to intervene, and permanently enjoined enforcement of the tax. The District Court ruled that the Tribe lacked the authority to impose the tax, that only state and local authorities had the power to tax oil and gas production on Indian reservations, and that the tax violated the Commerce Clause.
The United States Court of Appeals for the Tenth Circuit, sitting en banc, reversed. 617 F.2d 537 (1980).[4] The Court of Appeals reasoned that the taxing power is an inherent attribute of tribal sovereignty that has not been divested by any treaty or Act of Congress, including the 1927 Act, 25 U.S. C. ง 398c. The court also found no Commerce Clause violation. We granted certiorari, 449 U.S. 820 (1980), and we now affirm the decision of the Court of Appeals.
II
Petitioners argue, and the dissent agrees, that an Indian tribe's authority to tax non-Indians who do business on the *137 reservation stems exclusively from its power to exclude such persons from tribal lands. Because the Tribe did not initially condition the leases upon the payment of a severance tax, petitioners assert that the Tribe is without authority to impose such a tax at a later time. We disagree with the premise that the power to tax derives only from the power to exclude. Even if that premise is accepted, however, we disagree with the conclusion that the Tribe lacks the power to impose the severance tax.
A
In Washington v. Confederated Tribes of Colville Indian Reservation, 447 U.S. 134 (1980) (Colville), we addressed the Indian tribes' authority to impose taxes on non-Indians doing business on the reservation. We held that "[t]he power to tax transactions occurring on trust lands and significantly involving a tribe or its members is a fundamental attribute of sovereignty which the tribes retain unless divested of it by federal law or necessary implication of their dependent status." Id., at 152. The power to tax is an essential attribute of Indian sovereignty because it is a necessary instrument of self-government and territorial management. This power enables a tribal government to raise revenues for its essential services. The power does not derive solely from the Indian tribe's power to exclude non-Indians from tribal lands. Instead, it derives from the tribe's general authority, as sovereign, to control economic activity within its jurisdiction, and to defray the cost of providing governmental services by requiring contributions from persons or enterprises engaged in economic activities within that jurisdiction. See, e. g., Gibbons v. Ogden, 9 Wheat. 1, 199 (1824).
The petitioners avail themselves of the "substantial privilege of carrying on business" on the reservation. Mobil Oil Corp. v. Commissioner of Taxes, 445 U.S. 425, 437 (1980); Wisconsin v. J. C. Penney Co., 311 U.S. 435, 444-445 (1940). They benefit from the provision of police protection and other governmental services, as well as from " `the advantages *138 of a civilized society' " that are assured by the existence of tribal government. Exxon Corp. v. Wisconsin Dept. of Revenue, 447 U.S. 207, 228 (1980) (quoting Japan Line, Ltd. v. County of Los Angeles, 441 U.S. 434, 445 (1979)). Numerous other governmental entities levy a general revenue tax similar to that imposed by the Jicarilla Tribe when they provide comparable services. Under these circumstances, there is nothing exceptional in requiring petitioners to contribute through taxes to the general cost of tribal government.[5] Cf. Commonwealth Edison Co. v. Montana, 453 U.S. 609, 624-629 (1981); id., at 647 (BLACKMUN, J., dissenting); Mobil Oil Corp. v. Commissioner of Taxes, supra, at 436-437.
As we observed in Colville, supra, the tribe's interest in levying taxes on nonmembers to raise "revenues for essential governmental programs . . . is strongest when the revenues are derived from value generated on the reservation by activities involving the Tribes and when the taxpayer is the recipient of tribal services." 447 U.S., at 156-157. This surely is the case here. The mere fact that the government imposing the tax also enjoys rents and royalties as the lessor of the mineral lands does not undermine the government's authority to impose the tax. See infra, at 145-148. The royalty payments from the mineral leases are paid to the Tribe in its role as partner in petitioners' commercial venture. The severance tax, in contrast, is petitioners' contribution "to the general cost of providing governmental services." Commonwealth Edison Co. v. Montana, supra, at 623. State governments commonly receive both royalty payments and severance taxes from lessees of mineral lands within their borders.
*139 Viewing the taxing power of Indian tribes as an essential instrument of self-government and territorial management has been a shared assumption of all three branches of the Federal Government. Cf. Colville, supra, at 153. In Colville, the Court relied in part on a 1934 opinion of the Solicitor for the Department of the Interior. In this opinion, the Solicitor recognized that, in the absence of congressional action to the contrary, the tribes' sovereign power to tax " `may be exercised over members of the tribe and over nonmembers, so far as such nonmembers may accept privileges of trade, residence, etc., to which taxes may be attached as conditions.' " 447 U.S., at 153 (quoting Powers of Indian Tribes, 55 I.D. 14, 46 (1934)). Colville further noted that official executive pronouncements have repeatedly recognized that "Indian tribes possess a broad measure of civil jurisdiction over the activities of non-Indians on Indian reservation lands in which the tribes have a significant interest . . . , including jurisdiction to tax." 447 U.S., at 152-153 (citing 23 Op. Atty. Gen. 214 (1900); 17 Op. Atty. Gen. 134 (1881); 7 Op. Atty. Gen. 174 (1855)).[6]
Similarly, Congress has acknowledged that the tribal power to tax is one of the tools necessary to self-government and territorial control. As early as 1879, the Senate Judiciary *140 Committee acknowledged the validity of a tax imposed by the Chickasaw Nation on non-Indians legitimately within its territory:
"We have considered [Indian tribes] as invested with the right of self-government and jurisdiction over the persons and property within the limits of the territory they occupy, except so far as that jurisdiction has been restrained and abridged by treaty or act of Congress. Subject to the supervisory control of the Federal Government, they may enact the requisite legislation to maintain peace and good order, improve their condition, establish school systems, and aid their people in their efforts to acquire the arts of civilized life; and they undoubtedly possess the inherent right to resort to taxation to raise the necessary revenue for the accomplishment of these vitally important objects โ a right not in any sense derived from the Government of the United States." S. Rep. No. 698, 45th Cong., 3d Sess., 1-2 (1879) (emphasis added).
Thus, the views of the three federal branches of government, as well as general principles of taxation, confirm that Indian tribes enjoy authority to finance their governmental services through taxation of non-Indians who benefit from those services. Indeed, the conception of Indian sovereignty that this Court has consistently reaffirmed permits no other conclusion. As we observed in United States v. Mazurie, 419 U.S. 544, 557 (1975). "Indian tribes within `Indian country' are a good deal more than `private, voluntary organizations.' " They "are unique aggregations possessing attributes of sovereignty over both their members and their territory." Ibid. See, e. g., Worcester v. Georgia, 6 Pet. 515, 557 (1832); Iron Crow v. Oglala Sioux Tribe of Pine Ridge Reservation, 231 F.2d 89, 92, 99 (CA8 1956); Crabtree v. Madden, 54 F. 426, 428-429 (CA8 1893); Cohen, `The Spanish Origin of Indian Rights in the Law of the United States,' in The Legal Conscience 230, 234 (L. Cohen ed. *141 1960). Adhering to this understanding, we conclude that the Tribe's authority to tax non-Indians who conduct business on the reservation does not simply derive from the Tribe's power to exclude such persons, but is an inherent power necessary to tribal self-government and territorial management.
Of course, the Tribe's authority to tax nonmembers is subject to constraints not imposed on other governmental entities: the Federal Government can take away this power, and the Tribe must obtain the approval of the Secretary before any tax on nonmembers can take effect. These additional constraints minimize potential concern that Indian tribes will exercise the power to tax in an unfair or unprincipled manner, and ensure that any exercise of the tribal power to tax will be consistent with national policies.
We are not persuaded by the dissent's attempt to limit an Indian tribe's authority to tax non-Indians by asserting that its only source is the tribe's power to exclude such persons from tribal lands. Limiting the tribes' authority to tax in this manner contradicts the conception that Indian tribes are domestic, dependent nations, as well as the common understanding that the sovereign taxing power is a tool for raising revenue necessary to cover the costs of government.
Nor are we persuaded by the dissent that three early decisions upholding tribal power to tax nonmembers support this limitation. Post, at 175-183, discussing Morris v. Hitchcock, 194 U.S. 384 (1904); Buster v. Wright, 135 F. 947 (CA8 1905), appeal dism'd, 203 U.S. 599 (1906); Maxey v. Wright, 3 Ind. T. 243, 247-250, 54 S.W. 807, 809 (Ct. App. Ind. T.), aff'd, 105 F. 1003 (CA8 1900). In discussing these cases, the dissent correctly notes that a hallmark of Indian sovereignty is the power to exclude non-Indians from Indian lands, and that this power provides a basis for tribal authority to tax. None of these cases, however, establishes that the authority to tax derives solely from the power to exclude. Instead, these cases demonstrate that a tribe has the power to tax nonmembers only to the extent the nonmember enjoys the *142 privilege of trade or other activity on the reservation to which the tribe can attach a tax. This limitation on tribal taxing authority exists not because the tribe has the power to exclude nonmembers, but because the limited authority that a tribe may exercise over nonmembers does not arise until the nonmember enters the tribal jurisdiction. We do not question that there is a significant territorial component to tribal power: a tribe has no authority over a nonmember until the nonmember enters tribal lands or conducts business with the tribe. However, we do not believe that this territorial component to Indian taxing power, which is discussed in these early cases, means that the tribal authority to tax derives solely from the tribe's power to exclude nonmembers from tribal lands.
Morris v. Hitchcock, for example, suggests that the taxing power is a legitimate instrument for raising revenue, and that a tribe may exercise this power over non-Indians who receive privileges from the tribe, such as the right to trade on Indian land. In Morris, the Court approved a tax on cattle grazing and relied in part on a Report to the Senate by the Committee on the Judiciary, which found no legal defect in previous tribal tax legislation having "a twofold object โ to prevent the intrusion of unauthorized persons into the territory of the Chickasaw Nation, and to raise revenue." 194 U.S., at 389 (emphasis added). In Maxey v. Wright, the question of Indian sovereignty was not even raised: the decision turned on the construction of a treaty denying the Tribe any governing or jurisdictional authority over nonmembers. 3 Ind. T., at 247-248, 54 S.W., at 809.[7]
*143 Finally, the decision in Buster v. Wright actually undermines the theory that the tribes' taxing authority derives solely from the power to exclude non-Indians from tribal lands. Under this theory, a non-Indian who establishes lawful presence in Indian territory could avoid paying a tribal tax by claiming that no residual portion of the power to exclude supports the tax. This result was explicitly rejected in Buster v. Wright. In Buster, deeds to individual lots in Indian territory had been granted to non-Indian residents, and cities and towns had been incorporated. As a result, Congress had expressly prohibited the Tribe from removing these non-Indian residents. Even though the ownership of land and the creation of local governments by non-Indians established their legitimate presence on Indian land, the court held that the Tribe retained its power to tax. The court concluded that "[n]either the United States, nor a state, nor any other sovereignty loses the power to govern the people within its borders by the existence of towns and cities therein endowed with the usual powers of municipalities, nor by the ownership nor occupancy of the land within its territorial jurisdiction by citizens or foreigners." 135 F., at 952 (emphasis *144 added).[8] This result confirms that the Tribe's authority to tax derives not from its power to exclude, but from its power to govern and to raise revenues to pay for the costs of government.
We choose not to embrace a new restriction on the extent of the tribal authority to tax, which is based on a questionable interpretation of three early cases. Instead, based on the views of each of the federal branches, general principles of taxation, and the conception of Indian tribes as domestic, dependent nations, we conclude that the Tribe has the authority to impose a severance tax on the mining activities of petitioners as part of its power to govern and to pay for the costs of self-government.
B
Alternatively, if we accept the argument, advanced by petitioners and the dissent, that the Tribe's authority to tax derives solely from its power to exclude non-Indians from the reservation, we conclude that the Tribe has the authority to impose the severance tax challenged here. Nonmembers who lawfully enter tribal lands remain subject to the tribe's power to exclude them. This power necessarily includes the lesser power to place conditions on entry, on continued presence, or on reservation conduct, such as a tax on business activities conducted on the reservation. When a tribe grants a non-Indian the right to be on Indian land, the tribe agrees not to exercise its ultimate power to oust the non-Indian as long as the non-Indian complies with the initial conditions of entry. However, it does not follow that the lawful property right to be on Indian land also immunizes the non-Indian from the tribe's exercise of its lesser-included power to tax or to *145 place other conditions on the non-Indian's conduct or continued presence on the reservation.[9] A nonmember who enters the jurisdiction of the tribe remains subject to the risk that the tribe will later exercise its sovereign power. The fact that the tribe chooses not to exercise its power to tax when it initially grants a non-Indian entry onto the reservation does not permanently divest the tribe of its authority to impose such a tax.[10]
Petitioners argue that their leaseholds entitle them to enter the reservation and exempt them from further exercises of the Tribe's sovereign authority. Similarly, the dissent asserts that the Tribe has lost the power to tax petitioners' mining activities because it has leased to them the use of the mineral lands and such rights of access to the reservation as might be necessary to enjoy the leases. Post, at 186-190.[11] However, this conclusion is not compelled by linking the taxing power to the power to exclude. Instead, it is based on additional assumptions and confusions about the consequences of the commercial arrangement between petitioners and the Tribe.
Most important, petitioners and the dissent confuse the Tribe's role as commercial partner with its role as sovereign.[12]*146 This confusion relegates the powers of sovereignty to the bargaining process undertaken in each of the sovereign's commercial agreements. It is one thing to find that the Tribe has agreed to sell the right to use the land and take from it valuable minerals; it is quite another to find that the Tribe has abandoned its sovereign powers simply because it has not expressly reserved them through a contract.
Confusing these two results denigrates Indian sovereignty. Indeed, the dissent apparently views the tribal power to exclude, as well as the derivative authority to tax, as merely the power possessed by any individual landowner or any social group to attach conditions, including a "tax" or fee, to the entry by a stranger onto private land or into the social group, and not as a sovereign power. The dissent does pay lipservice to the established views that Indian tribes retain those fundamental attributes of sovereignty, including the power to tax transactions that occur on tribal lands, which have not been divested by Congress or by necessary implication of the tribe's dependent status, see Colville, 447 U. S., at 152, and that tribes "are a good deal more than `private, voluntary organizations.' " United States v. Mazurie, 419 U. S., at 557. However, in arguing that the Tribe somehow "lost" its power to tax petitioners by not including *147 a taxing provision in the original leases or otherwise notifying petitioners that the Tribe retained and might later exercise its sovereign right to tax them, the dissent attaches little significance to the sovereign nature of the tribal authority to tax, and it obviously views tribal authority as little more than a landowner's contractual right. This overly restrictive view of tribal sovereignty is further reflected in the dissent's refusal to apply established principles for determining whether other governmental bodies have waived a sovereign power through contract. See post, at 189, n. 50. See also infra, at 148.
Moreover, the dissent implies that the power to tax depends on the consent of the taxed as well as on the Tribe's power to exclude non-Indians. Whatever place consent may have in contractual matters and in the creation of democratic governments, it has little if any role in measuring the validity of an exercise of legitimate sovereign authority. Requiring the consent of the entrant deposits in the hands of the excludable non-Indian the source of the tribe's power, when the power instead derives from sovereignty itself. Only the Federal Government may limit a tribe's exercise of its sovereign authority. E. g., United States v. Wheeler, 435 U.S. 313, 322 (1978).[13] Indian sovereignty is not conditioned on the assent of a nonmember; to the contrary, the nonmember's presence and conduct on Indian lands are conditioned by the limitations the tribe may choose to impose.
Viewed in this light, the absence of a reference to the tax in the leases themselves hardly impairs the Tribe's authority to impose the tax. Contractual arrangements remain subject to subsequent legislation by the presiding sovereign. See, e. g., Veix v. Sixth Ward Building & Loan Assn. of *148 Newark, 310 U.S. 32 (1940); Home Building & Loan Assn. v. Blaisdell, 290 U.S. 398 (1934). Even where the contract at issue requires payment of a royalty for a license or franchise issued by the governmental entity, the government's power to tax remains unless it "has been specifically surrendered in terms which admit of no other reasonable interpretation." St. Louis v. United R. Co., 210 U.S. 266, 280 (1908).
To state that Indian sovereignty is different than that of Federal, State or local Governments, see post, at 189, n. 50, does not justify ignoring the principles announced by this Court for determining whether a sovereign has waived its taxing authority in cases involving city, state, and federal taxes imposed under similar circumstances. Each of these governments has different attributes of sovereignty, which also may derive from different sources. These differences, however, do not alter the principles for determining whether any of these governments has waived a sovereign power through contract, and we perceive no principled reason for holding that the different attributes of Indian sovereignty require different treatment in this regard. Without regard to its source, sovereign power, even when unexercised, is an enduring presence that governs all contracts subject to the sovereign's jurisdiction, and will remain intact unless surrendered in unmistakable terms.
No claim is asserted in this litigation, nor could one be, that petitioners' leases contain the clear and unmistakable surrender of taxing power required for its extinction. We could find a waiver of the Tribe's taxing power only if we inferred it from silence in the leases. To presume that a sovereign forever waives the right to exercise one of its sovereign powers unless it expressly reserves the right to exercise that power in a commercial agreement turns the concept of sovereignty on its head, and we do not adopt this analysis.[14]
*149 C
The Tribe has the inherent power to impose the severance tax on petitioners, whether this power derives from the Tribe's power of self-government or from its power to exclude. Because Congress may limit tribal sovereignty, we now review petitioners' argument that Congress, when it enacted two federal Acts governing Indians and various pieces of federal energy legislation, deprived the Tribe of its authority to impose the severance tax.
In Colville, we concluded that the "widely held understanding within the Federal Government has always been that federal law to date has not worked a divestiture of Indian taxing power." 447 U.S., at 152 (emphasis added). Moreover, we noted that "[n]o federal statute cited to us shows any congressional departure from this view." Id., at 153. Likewise, petitioners can cite to no statute that specifically divests the Tribe of its power to impose the severance tax on their mining activities. Instead, petitioners argue that Congress implicitly took away this power when it enacted the Acts and various pieces of legislation on which petitioners rely. Before reviewing this argument, we reiterate here our admonition in Santa Clara Pueblo v. Martinez, 436 U.S. 49, 60 (1978): "a proper respect both for tribal sovereignty itself and for the plenary authority of Congress in this area cautions that we tread lightly in the absence of clear indications of legislative intent."
*150 Petitioners argue that Congress pre-empted the Tribe's power to impose a severance tax when it enacted the 1938 Act, 25 U.S. C. งง 396a-396g. In essence, petitioners argue that the tax constitutes an additional burden on lessees that is inconsistent with the Act's regulatory scheme for leasing and developing oil and gas reserves on Indian land. This Act, and the regulations promulgated by the Department of the Interior for its enforcement, establish the procedures to be followed for leasing oil and gas interests on tribal lands. However, the proviso to 25 U.S. C. ง 396b states that "the foregoing provisions shall in no manner restrict the right of tribes . . . to lease lands for mining purposes . . . in accordance with the provisions of any constitution and charter adopted by any Indian tribe pursuant to sections 461, 462, 463, [464-475, 476-478], and 479 of this title" (emphasis added).[15] Therefore, this Act does not prohibit the Tribe from imposing a severance tax on petitioners' mining activities pursuant to its Revised Constitution, when both the Revised Constitution and the ordinance authorizing the tax are approved by the Secretary.[16]
Petitioners also assert that the 1927 Act, 25 U.S. C. งง 398a-398e, divested the Tribe's taxing power. We disagree. The 1927 Act permits state taxation of mineral lessees *151 on Executive Order reservations, but it indicates no change in the taxing power of the affected tribes. See 25 U.S. C. ง 398c. Without mentioning the tribal authority to tax, the Act authorizes state taxation of royalties from mineral production on all Indian lands. Petitioners argue that the Act transferred the Indian power to tax mineral production to the States in exchange for the royalties assured the tribes. This claim not only lacks any supporting evidence in the legislative history, it also deviates from settled principles of taxation: different sovereigns can enjoy powers to tax the same transactions. Thus, the mere existence of state authority to tax does not deprive the Indian tribe of its power to tax. Fort Mojave Tribe v. County of San Bernardino, 543 F.2d 1253 (CA9 1976), cert. denied, 430 U.S. 983 (1977). Cf. Colville, 447 U. S., at 158 ("There is no direct conflict between the state and tribal schemes, since each government is free to impose its taxes without ousting the other").[17]
Finally, petitioners contend that tribal taxation of oil and gas conflicts with national energy policies, and therefore the tribal tax is pre-empted by federal law. Again, petitioners cite no specific federal statute restricting Indian sovereignty. Nor do they explain why state taxation of the same type of activity escapes the asserted conflict with federal policy. Cf. Commonwealth Edison Co. v. Montana, 453 U.S. 609 (1981). Indeed, rather than forbidding tribal severance taxes, Congress has included taxes imposed by an Indian *152 tribe in its definition of costs that may be recovered under federal energy pricing regulations. Natural Gas Policy Act of 1978, Pub. L. 95-621, งง 110(a), (c)(1), 92 Stat. 3368, 15 U.S. C. งง 3320(a), (c)(1) (1976 ed., Supp. IV). Although this inclusion may not reflect Congress' view with respect to the source of a tribe's power to impose a severance tax,[18] it surely indicates that imposing such a tax would not contravene federal energy policy and that the tribal authority to do so is not implicitly divested by that Act.
We find no "clear indications" that Congress has implicitly deprived the Tribe of its power to impose the severance tax. In any event, if there were ambiguity on this point, the doubt would benefit the Tribe, for "[a]mbiguities in federal law have been construed generously in order to comport with . . . traditional notions of sovereignty and with the federal policy of encouraging tribal independence." White Mountain Apache Tribe v. Bracker, 448 U.S. 136, 143-144 (1980). Accordingly, we find that the Federal Government has not divested the Tribe of its inherent authority to tax mining activities on its land, whether this authority derives from the Tribe's power of self-government or from its power to exclude.
III
Finding no defect in the Tribe's exercise of its taxing power, we now address petitioners' contention that the severance tax violates the "negative implications" of the Commerce Clause because it taxes an activity that is an integral *153 part of the flow of commerce, discriminates against interstate commerce, and imposes a multiple burden on interstate commerce. At the outset, we note that reviewing tribal action under the Interstate Commerce Clause is not without conceptual difficulties. E. g., nn. 21 and 24, infra. Apparently recognizing these difficulties, the Solicitor General, on behalf of the Secretary, argues that the language,[19] the structure, and the purposes of the Commerce Clause support the conclusion that the Commerce Clause does not, of its own force, limit Indian tribes in their dealings with non-Indians. Brief for Secretary of Interior 35-40. The Solicitor General reasons that the Framers did not intend "the courts, through the Commerce Clause, to impose their own views of the proper relationship between Indians and non-Indians and to strike down measures adopted by a tribe with which the political departments of government had not seen fit to disagree." Id., at 39. Instead, where tribal legislation is inimical to the national welfare, the Solicitor asserts that the Framers contemplated that the remedies would be the negotiation or renegotiation of treaties, the enactment of legislation governing trade and other relations, or the exertion of superior force by the United States Government. Id., at 38-39. Using similar reasoning, the Solicitor suggests that if the Commerce Clause does impose restrictions on tribal activity, those restrictions must arise from the Indian Commerce Clause, and not its interstate counterpart. Id., at 40-43.
To date, however, this Court has relied on the Indian Commerce Clause as a shield to protect Indian tribes from state *154 and local interference, and has not relied on the Clause to authorize tribal regulation of commerce without any constitutional restraints. We see no need to break new ground in this area today: even if we assume that tribal action is subject to the limitations of the Interstate Commerce Clause, this tax does not violate the "negative implications" of that Clause.
A
A state tax may violate the "negative implications" of the Interstate Commerce Clause by unduly burdening or discriminating against interstate commerce. See, e. g., Commonwealth Edison Co. v. Montana, 453 U.S. 609 (1981); Complete Auto Transit, Inc. v. Brady, 430 U.S. 274 (1977). Judicial review of state taxes under the Interstate Commerce Clause is intended to ensure that States do not disrupt or burden interstate commerce when Congress' power remains unexercised: it protects the free flow of commerce, and thereby safeguards Congress' latent power from encroachment by the several States.
However, we only engage in this review when Congress has not acted or purported to act. See, e. g., Prudential Insurance Co. v. Benjamin, 328 U.S. 408, 421-427 (1946). Once Congress acts, courts are not free to review state taxes or other regulations under the dormant Commerce Clause. When Congress has struck the balance it deems appropriate, the courts are no longer needed to prevent States from burdening commerce, and it matters not that the courts would invalidate the state tax or regulation under the Commerce Clause in the absence of congressional action. See Prudential Insurance Co. v. Benjamin, supra, at 431.[20] Courts are *155 final arbiters under the Commerce Clause only when Congress has not acted. See Japan Line, Ltd. v. County of Los Angeles, 441 U. S., at 454.
Here, Congress has affirmatively acted by providing a series of federal checkpoints that must be cleared before a tribal tax can take effect.[21] Under the Indian Reorganization Act, 25 U.S. C. งง 476, 477, a tribe must obtain approval from the Secretary before it adopts or revises its constitution to announce its intention to tax nonmembers. Further, before the ordinance imposing the severance tax challenged here could take effect, the Tribe was required again to obtain approval from the Secretary. See Revised Constitution of the Jicarilla Tribe, Art. XI, งง 1(e), 2. Cf. 25 U.S. C. งง 476, 477; 25 CFR ง 171.29 (1980) (implementing the proviso to 25 U.S. C. ง 396b, quoted in n. 15, supra).
As we noted earlier, the severance tax challenged by petitioners was enacted in accordance with this congressional scheme. Both the Tribe's Revised Constitution and the challenged tax ordinance received the requisite approval from the Secretary. This course of events fulfilled the administrative process established by Congress to monitor such exercises of tribal authority. As a result, this tribal tax comes to us in a *156 posture significantly different from a challenged state tax, which does not need specific federal approval to take effect, and which therefore requires, in the absence of congressional ratification, judicial review to ensure that it does not unduly burden or discriminate against interstate commerce. Judicial review of the Indian tax measure, in contrast, would duplicate the administrative review called for by the congressional scheme.
Finally, Congress is well aware that Indian tribes impose mineral severance taxes such as the one challenged by petitioners. See Natural Gas Policy Act of 1978, 15 U.S. C. งง 3320(a), (c)(1) (1976 ed., Supp. IV). Congress, of course, retains plenary power to limit tribal taxing authority or to alter the current scheme under which the tribes may impose taxes. However, it is not our function nor our prerogative to strike down a tax that has traveled through the precise channels established by Congress, and has obtained the specific approval of the Secretary.
B
The tax challenged here would survive judicial scrutiny under the Interstate Commerce Clause, even if such scrutiny were necessary. In Complete Auto Transit, Inc. v. Brady, supra, at 279, we held that a state tax on activities connected to interstate commerce is sustainable if it "is applied to an activity with a substantial nexus with the taxing State, is fairly apportioned, does not discriminate against interstate commerce, and is fairly related to the services provided by the State." Petitioners do not question that the tax on the severance of minerals from the mines[22] meets the first and the *157 second tests: the mining activities taxed pursuant to the ordinance occur entirely on reservation land. Furthermore, petitioners do not challenge the tax on the ground that the amount of the tax is not fairly related to the services provided by the Tribe. See Supplemental Brief for Petitioners in No. 80-15, pp. 11, 17-20.[23]
Instead, petitioners focus their attack on the third factor, and argue that the tax discriminates against interstate commerce. In essence, petitioners argue that the language "sold or transported off the reservation" exempts from taxation minerals sold on the reservation, kept on the reservation for use by individual members of the Tribe, and minerals taken by the Tribe on the reservation as in-kind royalty. Although petitioners admit that no sales have occurred on the reservation to date, they argue that the Tribe might induce private industry to locate on the reservation to take advantage of this allegedly discriminatory taxing policy. We do not accept petitioners' arguments; instead, we agree with the Tribe, the Solicitor General, and the Court of Appeals that the tax is imposed on minerals sold on the reservation or transported off the reservation before sale. See 617 F.2d, at 546. Cf. n. 22, supra.[24] Under this interpretation, the tax does not *158 treat minerals transported away from the reservation differently than it treats minerals that might be sold on the reservation. Nor does the Tribe's tax ordinance exempt minerals ultimately received by individual members of the Tribe. The ordinance does exempt minerals received by the Tribe as in-kind payments on the leases and used for tribal purposes,[25] but this exemption merely avoids the administrative make-work that would ensue if the Tribe, as local government, taxed the amount of minerals that the Tribe, as commercial partner, received in royalty payments. Therefore, this exemption cannot be deemed a discriminatory preference for local commerce.[26]
*159 IV
In Worcester v. Georgia, 6 Pet., at 559, Chief Justice Marshall observed that Indian tribes had "always been considered as distinct, independent political communities, retaining their original natural rights." Although the tribes are subject to the authority of the Federal Government, the "weaker power does not surrender its independence โ its right to self-government, by associating with a stronger, and taking its protection." Id., at 561. Adhering to this understanding, we conclude that the Tribe did not surrender its authority to tax the mining activities of petitioners, whether this authority is deemed to arise from the Tribe's inherent power of self-government or from its inherent power to exclude nonmembers. Therefore, the Tribe may enforce its severance tax unless and until Congress divests this power, an action that Congress has not taken to date. Finally, the severance tax imposed by the Tribe cannot be invalidated on the ground that it violates the "negative implications" of the Commerce Clause.
Affirmed. | Pursuant long-term leases with the Jicarilla Apache Tribe, petitioners, 21 lessees, extract and produce oil and gas from the Tribe's reservation lands. In these two consolidated cases, petitioners challenge an ordinance enacted by the Tribe imposing a severance tax on "any oil and natural gas severed, saved and removed from Tribal lands." See Oil and Gas Severance Tax No. 77-0-02, App. 38. We granted certiorari determine whether the Tribe has the authority impose this tax, and, if so, whether the tax imposed by the Tribe violates the Commerce Clause. I The Jicarilla Apache Tribe resides on a reservation in northwestern New Mexico. Established by Executive Order in 1887,[1] the reservation contains 742,3 acres, all of which are held as tribal trust property. The 1887 Executive *134 Order set aside public lands in the Terriry of New Mexico for the use and occupation of the Jicarilla Apache Indians, and contained no special restrictions except for a provision protecting pre-existing rights of bona fide settlers.[2] Approximately 2,100 individuals live on the reservation, with the majority residing in the wn of Dulce, N. M., near the Colorado border. The Tribe is organized under the Indian Reorganization Act of 1934, ch. 576, 25 U.S. C. ง 461 et seq., which authorizes any tribe residing on a reservation adopt a constitution and bylaws, subject the approval of the Secretary of the Interior (Secretary).[3] The Tribe's first Constitution, approved by the Secretary on August 4, 1937, preserved all powers conferred by ง 16 of the Indian Reorganization Act of 1934, ch. 576, 25 U.S. C. ง 476. In 1968, the Tribe revised its Constitution specify: "The inherent powers of the Jicarilla Apache Tribe, including those conferred by Section 16 of the Act of June 18, 1934 (), as amended, shall vest in the tribal council and shall be exercised thereby subject only limitations imposed by the Constitution of the United States, applicable Federal statutes and regulations of *135 the Department of the Interior, and the restrictions established by this revised constitution." Revised Constitution of the Jicarilla Apache Tribe, Art. XI, ง 1. The Revised Constitution provides that "[t]he tribal council may enact ordinances govern the development of tribal lands and other resources," Art. XI, ง 1(a)(3). It further provides that "[t]he tribal council may levy and collect taxes and fees on tribal members, and may enact ordinances, subject approval by the Secretary of the Interior, impose taxes and fees on non-members of the tribe doing business on the reservation," Art. XI, ง 1(e). The Revised Constitution was approved by the Secretary on February 13, 1969. To develop tribal lands, the Tribe has executed mineral leases encompassing some 69% of the reservation land. Beginning in 1953, the petitioners entered in leases with the Tribe. The Commissioner of Indian Affairs, on behalf of the Secretary, approved these leases, as required by the Act of May 11, 1938, ch. 198, 25 U.S. C. งง 396a-396g (1938 Act). In exchange for a cash bonus, royalties, and rents, the typical lease grants the lessee "the exclusive right and privilege drill for, mine, extract, remove, and dispose of all the oil and natural gas deposits in or under" the leased land for as long as the minerals are produced in paying quantities. App. 22. Petitioners may use oil and gas in developing the lease without incurring the royalty. In addition, the Tribe reserves the rights use gas without charge for any of its buildings on the leased land, and take its royalties in kind. Petitioners' activities on the leased land have been subject taxes imposed by the State of New Mexico on oil and gas severance and on oil and gas production equipment. See Act of Mar. 3, 1927, ch. 299, ง 3, 25 U.S. C. ง 398c (permitting state taxation of mineral production on Indian reservations) (1927 Act). Pursuant its Revised Constitution, the Tribal Council adopted an ordinance imposing a severance tax on oil and gas *136 production on tribal land. See App. 38. The ordinance was approved by the Secretary, through the Acting Direcr of the Bureau of Indian Affairs, on December 23, The tax applies "any oil and natural gas severed, saved and removed from Tribal lands" The tax is assessed at the wellhead at $0.05 per million Btu's of gas produced and $0.29 per barrel of crude oil or condensate produced on the reservation, and it is due at the time of severance. Oil and gas consumed by the lessees develop their leases or received by the Tribe as in-kind royalty payments are exempted from the tax. ; Brief for Respondent Jicarilla Apache Tribe 59, n. 42. In two separate actions, petitioners sought enjoin enforcement of the tax by either the tribal authorities or the Secretary. The United States District Court for the District of New Mexico consolidated the cases, granted other lessees leave intervene, and permanently enjoined enforcement of the tax. The District Court ruled that the Tribe lacked the authority impose the tax, that only state and local authorities had the power tax oil and gas production on Indian reservations, and that the tax violated the Commerce Clause. The United States Court of Appeals for the Tenth Circuit, sitting en banc, reversed.[4] The Court of Appeals reasoned that the taxing power is an inherent attribute of tribal sovereignty that has not been divested by any treaty or Act of Congress, including the 1927 Act, 25 U.S. C. ง 398c. The court also found no Commerce Clause violation. We granted certiorari, and we now affirm the decision of the Court of Appeals. II Petitioners argue, and the dissent agrees, that an Indian tribe's authority tax non-Indians who do business on the *137 reservation stems exclusively from its power exclude such persons from tribal lands. Because the Tribe did not initially condition the leases upon the payment of a severance tax, petitioners assert that the Tribe is without authority impose such a tax at a later time. We disagree with the premise that the power tax derives only from the power exclude. Even if that premise is accepted, however, we disagree with the conclusion that the Tribe lacks the power impose the severance tax. A In we addressed the Indian tribes' authority impose taxes on non-Indians doing business on the reservation. We held that "[t]he power tax transactions occurring on trust lands and significantly involving a tribe or its members is a fundamental attribute of sovereignty which the tribes retain unless divested of it by federal law or necessary implication of their dependent status." The power tax is an essential attribute of Indian sovereignty because it is a necessary instrument of self-government and terririal management. This power enables a tribal government raise revenues for its essential services. The power does not derive solely from the Indian tribe's power exclude non-Indians from tribal lands. Instead, it derives from the tribe's general authority, as sovereign, control economic activity within its jurisdiction, and defray the cost of providing governmental services by requiring contributions from persons or enterprises engaged in economic activities within that jurisdiction. See, e. g., The petitioners avail themselves of the "substantial privilege of carrying on business" on the reservation. Mobil Oil ; They benefit from the provision of police protection and other governmental services, as well as from " `the advantages *138 of a civilized society' " that are assured by the existence of tribal government. Exxon Numerous other governmental entities levy a general revenue tax similar that imposed by the Jicarilla Tribe when they provide comparable services. Under these circumstances, there is nothing exceptional in requiring petitioners contribute through taxes the general cost of tribal government.[5] Cf. Commonwealth Edison ; ; Mobil Oil at 436-. As we observed in the tribe's interest in levying taxes on nonmembers raise "revenues for essential governmental programs is strongest when the revenues are derived from value generated on the reservation by activities involving the Tribes and when the taxpayer is the recipient of tribal services." -7. This surely is the case here. The mere fact that the government imposing the tax also enjoys rents and royalties as the lessor of the mineral lands does not undermine the government's authority impose the tax. See infra, at 145-148. The royalty payments from the mineral leases are paid the Tribe in its role as partner in petitioners' commercial venture. The severance tax, in contrast, is petitioners' contribution " the general cost of providing governmental services." Commonwealth Edison State governments commonly receive both royalty payments and severance taxes from lessees of mineral lands within their borders. *139 Viewing the taxing power of Indian tribes as an essential instrument of self-government and terririal management has been a shared assumption of all three branches of the Federal Government. Cf. In the Court relied in part on a 1934 opinion of the Solicir for the Department of the Interior. In this opinion, the Solicir recognized that, in the absence of congressional action the contrary, the tribes' sovereign power tax " `may be exercised over members of the tribe and over nonmembers, so far as such nonmembers may accept privileges of trade, residence, etc., which taxes may be attached as conditions.' " 447 U.S., further noted that official executive pronouncements have repeatedly recognized that "Indian tribes possess a broad measure of civil jurisdiction over the activities of non-Indians on Indian reservation lands in which the tribes have a significant interest including jurisdiction tax." 447 U.S., -3 ; 17 Op. Atty. Gen. 134 (1881); 7 Op. Atty. Gen. 174 (1855)).[6] Similarly, Congress has acknowledged that the tribal power tax is one of the ols necessary self-government and terririal control. As early as 1879, the Senate Judiciary *140 Committee acknowledged the validity of a tax imposed by the Chickasaw Nation on non-Indians legitimately within its terriry: "We have considered [Indian tribes] as invested with the right of self-government and jurisdiction over the persons and property within the limits of the terriry they occupy, except so far as that jurisdiction has been restrained and abridged by treaty or act of Congress. Subject the supervisory control of the Federal Government, they may enact the requisite legislation maintain peace and good order, improve their condition, establish school systems, and aid their people in their efforts acquire the arts of civilized life; and they undoubtedly possess the inherent right resort taxation raise the necessary revenue for the accomplishment of these vitally important objects โ a right not in any sense derived from the Government of the United States." S. Rep. No. 698, 45th Cong., 3d Sess., 1-2 (1879) Thus, the views of the three federal branches of government, as well as general principles of taxation, confirm that Indian tribes enjoy authority finance their governmental services through taxation of non-Indians who benefit from those services. Indeed, the conception of Indian sovereignty that this Court has consistently reaffirmed permits no other conclusion. As we observed in United "Indian tribes within `Indian country' are a good deal more than `private, voluntary organizations.' " They "are unique aggregations possessing attributes of sovereignty over both their members and their terriry." See, e. g., ; Iron ; ; Cohen, `The Spanish Origin of Indian Rights in the Law of the United States,' in The Legal Conscience 230, 234 (L. Cohen ed. *141 19). Adhering this understanding, we conclude that the Tribe's authority tax non-Indians who conduct business on the reservation does not simply derive from the Tribe's power exclude such persons, but is an inherent power necessary tribal self-government and terririal management. Of course, the Tribe's authority tax nonmembers is subject constraints not imposed on other governmental entities: the Federal Government can take away this power, and the Tribe must obtain the approval of the Secretary before any tax on nonmembers can take effect. These additional constraints minimize potential concern that Indian tribes will exercise the power tax in an unfair or unprincipled manner, and ensure that any exercise of the tribal power tax will be consistent with national policies. We are not persuaded by the dissent's attempt limit an Indian tribe's authority tax non-Indians by asserting that its only source is the tribe's power exclude such persons from tribal lands. Limiting the tribes' authority tax in this manner contradicts the conception that Indian tribes are domestic, dependent nations, as well as the common understanding that the sovereign taxing power is a ol for raising revenue necessary cover the costs of government. Nor are we persuaded by the dissent that three early decisions upholding tribal power tax nonmembers support this limitation. Post, at 175-183, discussing ; appeal dism'd, ; (Ct. App. Ind. T.), aff'd, In discussing these cases, the dissent correctly notes that a hallmark of Indian sovereignty is the power exclude non-Indians from Indian lands, and that this power provides a basis for tribal authority tax. None of these cases, however, establishes that the authority tax derives solely from the power exclude. Instead, these cases demonstrate that a tribe has the power tax nonmembers only the extent the nonmember enjoys the *142 privilege of trade or other activity on the reservation which the tribe can attach a tax. This limitation on tribal taxing authority exists not because the tribe has the power exclude nonmembers, but because the limited authority that a tribe may exercise over nonmembers does not arise until the nonmember enters the tribal jurisdiction. We do not question that there is a significant terririal component tribal power: a tribe has no authority over a nonmember until the nonmember enters tribal lands or conducts business with the tribe. However, we do not believe that this terririal component Indian taxing power, which is discussed in these early cases, means that the tribal authority tax derives solely from the tribe's power exclude nonmembers from tribal lands. for example, suggests that the taxing power is a legitimate instrument for raising revenue, and that a tribe may exercise this power over non-Indians who receive privileges from the tribe, such as the right trade on Indian land. In Morris, the Court approved a tax on cattle grazing and relied in part on a Report the Senate by the Committee on the Judiciary, which found no legal defect in previous tribal tax legislation having "a twofold object โ prevent the intrusion of unauthorized persons in the terriry of the Chickasaw Nation, and raise revenue." In the question of Indian sovereignty was not even raised: the decision turned on the construction of a treaty denying the Tribe any governing or jurisdictional authority over 3 Ind. T., 7, 54 S.W., at[7] *143 Finally, the decision in actually undermines the theory that the tribes' taxing authority derives solely from the power exclude non-Indians from tribal lands. Under this theory, a non-Indian who establishes lawful presence in Indian terriry could avoid paying a tribal tax by claiming that no residual portion of the power exclude supports the tax. This result was explicitly rejected in In Buster, deeds individual lots in Indian terriry had been granted non-Indian residents, and cities and wns had been incorporated. As a result, Congress had expressly prohibited the Tribe from removing these non-Indian residents. Even though the ownership of land and the creation of local governments by non-Indians established their legitimate presence on Indian land, the court held that the Tribe retained its power tax. The court concluded that "[n]either the United States, nor a state, nor any other sovereignty loses the power govern the people within its borders by the existence of wns and cities therein endowed with the usual powers of municipalities, nor by the ownership nor occupancy of the land within its terririal jurisdiction by citizens or foreigners."[8] This result confirms that the Tribe's authority tax derives not from its power exclude, but from its power govern and raise revenues pay for the costs of government. We choose not embrace a new restriction on the extent of the tribal authority tax, which is based on a questionable interpretation of three early cases. Instead, based on the views of each of the federal branches, general principles of taxation, and the conception of Indian tribes as domestic, dependent nations, we conclude that the Tribe has the authority impose a severance tax on the mining activities of petitioners as part of its power govern and pay for the costs of self-government. B Alternatively, if we accept the argument, advanced by petitioners and the dissent, that the Tribe's authority tax derives solely from its power exclude non-Indians from the reservation, we conclude that the Tribe has the authority impose the severance tax challenged here. Nonmembers who lawfully enter tribal lands remain subject the tribe's power exclude them. This power necessarily includes the lesser power place conditions on entry, on continued presence, or on reservation conduct, such as a tax on business activities conducted on the reservation. When a tribe grants a non-Indian the right be on Indian land, the tribe agrees not exercise its ultimate power oust the non-Indian as long as the non-Indian complies with the initial conditions of entry. However, it does not follow that the lawful property right be on Indian land also immunizes the non-Indian from the tribe's exercise of its lesser-included power tax or *145 place other conditions on the non-Indian's conduct or continued presence on the reservation.[9] A nonmember who enters the jurisdiction of the tribe remains subject the risk that the tribe will later exercise its sovereign power. The fact that the tribe chooses not exercise its power tax when it initially grants a non-Indian entry on the reservation does not permanently divest the tribe of its authority impose such a tax.[10] Petitioners argue that their leaseholds entitle them enter the reservation and exempt them from further exercises of the Tribe's sovereign authority. Similarly, the dissent asserts that the Tribe has lost the power tax petitioners' mining activities because it has leased them the use of the mineral lands and such rights of access the reservation as might be necessary enjoy the leases. Post, at 186-190.[11] However, this conclusion is not compelled by linking the taxing power the power exclude. Instead, it is based on additional assumptions and confusions about the consequences of the commercial arrangement between petitioners and the Tribe. Most important, petitioners and the dissent confuse the Tribe's role as commercial partner with its role as sovereign.[12]*146 This confusion relegates the powers of sovereignty the bargaining process undertaken in each of the sovereign's commercial agreements. It is one thing find that the Tribe has agreed sell the right use the land and take from it valuable minerals; it is quite another find that the Tribe has abandoned its sovereign powers simply because it has not expressly reserved them through a contract. Confusing these two results denigrates Indian sovereignty. Indeed, the dissent apparently views the tribal power exclude, as well as the derivative authority tax, as merely the power possessed by any individual landowner or any social group attach conditions, including a "tax" or fee, the entry by a stranger on private land or in the social group, and not as a sovereign power. The dissent does pay lipservice the established views that Indian tribes retain those fundamental attributes of sovereignty, including the power tax transactions that occur on tribal lands, which have not been divested by Congress or by necessary implication of the tribe's dependent status, see 447 U. S., and that tribes "are a good deal more than `private, voluntary organizations.' " United 419 U. S., at However, in arguing that the Tribe somehow "lost" its power tax petitioners by not including *147 a taxing provision in the original leases or otherwise notifying petitioners that the Tribe retained and might later exercise its sovereign right tax them, the dissent attaches little significance the sovereign nature of the tribal authority tax, and it obviously views tribal authority as little more than a landowner's contractual right. This overly restrictive view of tribal sovereignty is further reflected in the dissent's refusal apply established principles for determining whether other governmental bodies have waived a sovereign power through contract. See post, at 189, n. 50. See also infra, at 148. Moreover, the dissent implies that the power tax depends on the consent of the taxed as well as on the Tribe's power exclude non-Indians. Whatever place consent may have in contractual matters and in the creation of democratic governments, it has little if any role in measuring the validity of an exercise of legitimate sovereign authority. Requiring the consent of the entrant deposits in the hands of the excludable non-Indian the source of the tribe's power, when the power instead derives from sovereignty itself. Only the Federal Government may limit a tribe's exercise of its sovereign authority. E. g., United[13] Indian sovereignty is not conditioned on the assent of a nonmember; the contrary, the nonmember's presence and conduct on Indian lands are conditioned by the limitations the tribe may choose impose. Viewed in this light, the absence of a reference the tax in the leases themselves hardly impairs the Tribe's authority impose the tax. Contractual arrangements remain subject subsequent legislation by the presiding sovereign. See, e. g., ; Home Building & Loan Even where the contract at issue requires payment of a royalty for a license or franchise issued by the governmental entity, the government's power tax remains unless it "has been specifically surrendered in terms which admit of no other reasonable interpretation." St. To state that Indian sovereignty is different than that of Federal, State or local Governments, see post, at 189, n. 50, does not justify ignoring the principles announced by this Court for determining whether a sovereign has waived its taxing authority in cases involving city, state, and federal taxes imposed under similar circumstances. Each of these governments has different attributes of sovereignty, which also may derive from different sources. These differences, however, do not alter the principles for determining whether any of these governments has waived a sovereign power through contract, and we perceive no principled reason for holding that the different attributes of Indian sovereignty require different treatment in this regard. Without regard its source, sovereign power, even when unexercised, is an enduring presence that governs all contracts subject the sovereign's jurisdiction, and will remain intact unless surrendered in unmistakable terms. No claim is asserted in this litigation, nor could one be, that petitioners' leases contain the clear and unmistakable surrender of taxing power required for its extinction. We could find a waiver of the Tribe's taxing power only if we inferred it from silence in the leases. To presume that a sovereign forever waives the right exercise one of its sovereign powers unless it expressly reserves the right exercise that power in a commercial agreement turns the concept of sovereignty on its head, and we do not adopt this analysis.[14] *149 C The Tribe has the inherent power impose the severance tax on petitioners, whether this power derives from the Tribe's power of self-government or from its power exclude. Because Congress may limit tribal sovereignty, we now review petitioners' argument that Congress, when it enacted two federal Acts governing Indians and various pieces of federal energy legislation, deprived the Tribe of its authority impose the severance tax. In we concluded that the "widely held understanding within the Federal Government has always been that federal law date has not worked a divestiture of Indian taxing power." 447 U.S., Moreover, we noted that "[n]o federal statute cited us shows any congressional departure from this view." Likewise, petitioners can cite no statute that specifically divests the Tribe of its power impose the severance tax on their mining activities. Instead, petitioners argue that Congress implicitly ok away this power when it enacted the Acts and various pieces of legislation on which petitioners rely. Before reviewing this argument, we reiterate here our admonition in Santa Clara : "a proper respect both for tribal sovereignty itself and for the plenary authority of Congress in this area cautions that we tread lightly in the absence of clear indications of legislative intent." *0 Petitioners argue that Congress pre-empted the Tribe's power impose a severance tax when it enacted the 1938 Act, 25 U.S. C. งง 396a-396g. In essence, petitioners argue that the tax constitutes an additional burden on lessees that is inconsistent with the Act's regulary scheme for leasing and developing oil and gas reserves on Indian land. This Act, and the regulations promulgated by the Department of the Interior for its enforcement, establish the procedures be followed for leasing oil and gas interests on tribal lands. However, the proviso 25 U.S. C. ง 396b states that "the foregoing provisions shall in no manner restrict the right of tribes lease lands for mining purposes in accordance with the provisions of any constitution and charter adopted by any Indian tribe pursuant sections 461, 462, 463, [464-475, 476-478], and 479 of this title"[] Therefore, this Act does not prohibit the Tribe from imposing a severance tax on petitioners' mining activities pursuant its Revised Constitution, when both the Revised Constitution and the ordinance authorizing the tax are approved by the Secretary.[16] Petitioners also assert that the 1927 Act, 25 U.S. C. งง 398a-398e, divested the Tribe's taxing power. We disagree. The 1927 Act permits state taxation of mineral lessees *1 on Executive Order reservations, but it indicates no change in the taxing power of the affected tribes. See 25 U.S. C. ง 398c. Without mentioning the tribal authority tax, the Act authorizes state taxation of royalties from mineral production on all Indian lands. Petitioners argue that the Act transferred the Indian power tax mineral production the States in exchange for the royalties assured the tribes. This claim not only lacks any supporting evidence in the legislative hisry, it also deviates from settled principles of taxation: different sovereigns can enjoy powers tax the same transactions. Thus, the mere existence of state authority tax does not deprive the Indian tribe of its power tax. Fort Mojave cert. denied, Cf. ("There is no direct conflict between the state and tribal schemes, since each government is free impose its taxes without ousting the other").[17] Finally, petitioners contend that tribal taxation of oil and gas conflicts with national energy policies, and therefore the tribal tax is pre-empted by federal law. Again, petitioners cite no specific federal statute restricting Indian sovereignty. Nor do they explain why state taxation of the same type of activity escapes the asserted conflict with federal policy. Cf. Commonwealth Edison Indeed, rather than forbidding tribal severance taxes, Congress has included taxes imposed by an Indian *2 tribe in its definition of costs that may be recovered under federal energy pricing regulations. Natural Gas Policy Act of 1978, งง 110(a), (c)(1), U.S. C. งง 3320(a), (c)(1) ( ed., Supp. IV). Although this inclusion may not reflect Congress' view with respect the source of a tribe's power impose a severance tax,[18] it surely indicates that imposing such a tax would not contravene federal energy policy and that the tribal authority do so is not implicitly divested by that Act. We find no "clear indications" that Congress has implicitly deprived the Tribe of its power impose the severance tax. In any event, if there were ambiguity on this point, the doubt would benefit the Tribe, for "[a]mbiguities in federal law have been construed generously in order comport with traditional notions of sovereignty and with the federal policy of encouraging tribal independence." White Mountain Apache Accordingly, we find that the Federal Government has not divested the Tribe of its inherent authority tax mining activities on its land, whether this authority derives from the Tribe's power of self-government or from its power exclude. III Finding no defect in the Tribe's exercise of its taxing power, we now address petitioners' contention that the severance tax violates the "negative implications" of the Commerce Clause because it taxes an activity that is an integral *3 part of the flow of commerce, discriminates against interstate commerce, and imposes a multiple burden on interstate commerce. At the outset, we note that reviewing tribal action under the Interstate Commerce Clause is not without conceptual difficulties. E. g., nn. 21 and 24, infra. Apparently recognizing these difficulties, the Solicir General, on behalf of the Secretary, argues that the language,[19] the structure, and the purposes of the Commerce Clause support the conclusion that the Commerce Clause does not, of its own force, limit Indian tribes in their dealings with non-Indians. Brief for Secretary of Interior 35-40. The Solicir General reasons that the Framers did not intend "the courts, through the Commerce Clause, impose their own views of the proper relationship between Indians and non-Indians and strike down measures adopted by a tribe with which the political departments of government had not seen fit disagree." Instead, where tribal legislation is inimical the national welfare, the Solicir asserts that the Framers contemplated that the remedies would be the negotiation or renegotiation of treaties, the enactment of legislation governing trade and other relations, or the exertion of superior force by the United States Government. Using similar reasoning, the Solicir suggests that if the Commerce Clause does impose restrictions on tribal activity, those restrictions must arise from the Indian Commerce Clause, and not its interstate counterpart. To date, however, this Court has relied on the Indian Commerce Clause as a shield protect Indian tribes from state *4 and local interference, and has not relied on the Clause authorize tribal regulation of commerce without any constitutional restraints. We see no need break new ground in this area day: even if we assume that tribal action is subject the limitations of the Interstate Commerce Clause, this tax does not violate the "negative implications" of that Clause. A A state tax may violate the "negative implications" of the Interstate Commerce Clause by unduly burdening or discriminating against interstate commerce. See, e. g., Commonwealth Edison ; Complete Au Transit, Judicial review of state taxes under the Interstate Commerce Clause is intended ensure that States do not disrupt or burden interstate commerce when Congress' power remains unexercised: it protects the free flow of commerce, and thereby safeguards Congress' latent power from encroachment by the several States. However, we only engage in this review when Congress has not acted or purported act. See, e. g., Prudential Insurance Once Congress acts, courts are not free review state taxes or other regulations under the dormant Commerce Clause. When Congress has struck the balance it deems appropriate, the courts are no longer needed prevent States from burdening commerce, and it matters not that the courts would invalidate the state tax or regulation under the Commerce Clause in the absence of congressional action. See Prudential Insurance[20] Courts are *5 final arbiters under the Commerce Clause only when Congress has not acted. See Japan Line, Here, Congress has affirmatively acted by providing a series of federal checkpoints that must be cleared before a tribal tax can take effect.[21] Under the Indian Reorganization Act, 25 U.S. C. งง 476, 477, a tribe must obtain approval from the Secretary before it adopts or revises its constitution announce its intention tax Further, before the ordinance imposing the severance tax challenged here could take effect, the Tribe was required again obtain approval from the Secretary. See Revised Constitution of the Jicarilla Tribe, Art. XI, งง 1(e), 2. Cf. 25 U.S. C. งง 476, 477; 25 CFR ง 171.29 (implementing the proviso 25 U.S. C. ง 396b, quoted in n. As we noted earlier, the severance tax challenged by petitioners was enacted in accordance with this congressional scheme. Both the Tribe's Revised Constitution and the challenged tax ordinance received the requisite approval from the Secretary. This course of events fulfilled the administrative process established by Congress monir such exercises of tribal authority. As a result, this tribal tax comes us in a *6 posture significantly different from a challenged state tax, which does not need specific federal approval take effect, and which therefore requires, in the absence of congressional ratification, judicial review ensure that it does not unduly burden or discriminate against interstate commerce. Judicial review of the Indian tax measure, in contrast, would duplicate the administrative review called for by the congressional scheme. Finally, Congress is well aware that Indian tribes impose mineral severance taxes such as the one challenged by petitioners. See Natural Gas Policy Act of 1978, U.S. C. งง 3320(a), (c)(1) ( ed., Supp. IV). Congress, of course, retains plenary power limit tribal taxing authority or alter the current scheme under which the tribes may impose taxes. However, it is not our function nor our prerogative strike down a tax that has traveled through the precise channels established by Congress, and has obtained the specific approval of the Secretary. B The tax challenged here would survive judicial scrutiny under the Interstate Commerce Clause, even if such scrutiny were necessary. In Complete Au Transit, we held that a state tax on activities connected interstate commerce is sustainable if it "is applied an activity with a substantial nexus with the taxing State, is fairly apportioned, does not discriminate against interstate commerce, and is fairly related the services provided by the State." Petitioners do not question that the tax on the severance of minerals from the mines[22] meets the first and the *7 second tests: the mining activities taxed pursuant the ordinance occur entirely on reservation land. Furthermore, petitioners do not challenge the tax on the ground that the amount of the tax is not fairly related the services provided by the Tribe. See Supplemental Brief for Petitioners in No. 80-, pp. 11, 17-20.[23] Instead, petitioners focus their attack on the third facr, and argue that the tax discriminates against interstate commerce. In essence, petitioners argue that the language "sold or transported off the reservation" exempts from taxation minerals sold on the reservation, kept on the reservation for use by individual members of the Tribe, and minerals taken by the Tribe on the reservation as in-kind royalty. Although petitioners admit that no sales have occurred on the reservation date, they argue that the Tribe might induce private industry locate on the reservation take advantage of this allegedly discriminary taxing policy. We do not accept petitioners' arguments; instead, we agree with the Tribe, the Solicir General, and the Court of Appeals that the tax is imposed on minerals sold on the reservation or transported off the reservation before sale. See Cf. n. 22, supra.[24] Under this interpretation, the tax does not *8 treat minerals transported away from the reservation differently than it treats minerals that might be sold on the reservation. Nor does the Tribe's tax ordinance exempt minerals ultimately received by individual members of the Tribe. The ordinance does exempt minerals received by the Tribe as in-kind payments on the leases and used for tribal purposes,[25] but this exemption merely avoids the administrative make-work that would ensue if the Tribe, as local government, taxed the amount of minerals that the Tribe, as commercial partner, received in royalty payments. Therefore, this exemption cannot be deemed a discriminary preference for local commerce.[26] *9 IV In Chief Justice Marshall observed that Indian tribes had "always been considered as distinct, independent political communities, retaining their original natural rights." Although the tribes are subject the authority of the Federal Government, the "weaker power does not surrender its independence โ its right self-government, by associating with a stronger, and taking its protection." Adhering this understanding, we conclude that the Tribe did not surrender its authority tax the mining activities of petitioners, whether this authority is deemed arise from the Tribe's inherent power of self-government or from its inherent power exclude Therefore, the Tribe may enforce its severance tax unless and until Congress divests this power, an action that Congress has not taken date. Finally, the severance tax imposed by the Tribe cannot be invalidated on the ground that it violates the "negative implications" of the Commerce Clause. Affirmed. |
Justice O'Connor | concurring | false | Thompson v. Oklahoma | 1988-06-29T00:00:00 | null | https://www.courtlistener.com/opinion/112142/thompson-v-oklahoma/ | https://www.courtlistener.com/api/rest/v3/clusters/112142/ | 1,988 | 1987-153 | 2 | 5 | 3 | The plurality and dissent agree on two fundamental propositions: that there is some age below which a juvenile's crimes can never be constitutionally punished by death, and that our precedents require us to locate this age in light of the " `evolving standards of decency that mark the progress of a maturing society.' " See ante, at 821 (quoting Trop v. Dulles, 356 U.S. 86, 101 (1958) (opinion of Warren, C. J.)); ante, at 827-829; post, at 864-865, 872. See also, e. g., McCleskey v. Kemp, 481 U.S. 279, 300 (1987). I accept both principles. The disagreements between the plurality and the dissent rest on their different evaluations of the evidence available to us about the relevant social consensus. Although I believe that a national consensus forbidding the execution of any person *849 for a crime committed before the age of 16 very likely does exist, I am reluctant to adopt this conclusion as a matter of constitutional law without better evidence than we now possess. Because I conclude that the sentence in this case can and should be set aside on narrower grounds than those adopted by the plurality, and because the grounds on which I rest should allow us to face the more general question when better evidence is available, I concur only in the judgment of the Court.
I
Both the plurality and the dissent look initially to the decisions of American legislatures for signs of a national consensus about the minimum age at which a juvenile's crimes may lead to capital punishment. Although I agree with the dissent's contention, post, at 865, that these decisions should provide the most reliable signs of a society-wide consensus on this issue, I cannot agree with the dissent's interpretation of the evidence.
The most salient statistic that bears on this case is that every single American legislature that has expressly set a minimum age for capital punishment has set that age at 16 or above. See ante, at 829, and n. 30. When one adds these 18 States to the 14 that have rejected capital punishment completely, see ante, at 826, and n. 25, it appears that almost two-thirds of the state legislatures have definitely concluded that no 15-year-old should be exposed to the threat of execution. See also ante, at 829, n. 29 (pointing out that an additional two States with death penalty statutes on their books seem to have abandoned capital punishment in practice). Where such a large majority of the state legislatures have unambiguously outlawed capital punishment for 15-year-olds, and where no legislature in this country has affirmatively and unequivocally endorsed such a practice, strong counterevidence would be required to persuade me that a national consensus against this practice does not exist.
*850 The dissent argues that it has found such counterevidence in the laws of the 19 States that authorize capital punishment without setting any statutory minimum age. If we could be sure that each of these 19 state legislatures had deliberately chosen to authorize capital punishment for crimes committed at the age of 15, one could hardly suppose that there is a settled national consensus opposing such a practice. In fact, however, the statistics relied on by the dissent may be quite misleading. When a legislature provides for some 15-year-olds to be processed through the adult criminal justice system, and capital punishment is available for adults in that jurisdiction, the death penalty becomes at least theoretically applicable to such defendants. This is how petitioner was rendered death eligible, and the same possibility appears to exist in 18 other States. See post, at 861-862; ante, at 828, n. 26. As the plurality points out, however, it does not necessarily follow that the legislatures in those jurisdictions have deliberately concluded that it would be appropriate to impose capital punishment on 15-year-olds (or on even younger defendants who may be tried as adults in some jurisdictions). See ante, at 826, n. 24.
There are many reasons, having nothing whatsoever to do with capital punishment, that might motivate a legislature to provide as a general matter for some 15-year-olds to be channeled into the adult criminal justice process. The length or conditions of confinement available in the juvenile system, for example, might be considered inappropriate for serious crimes or for some recidivists. Similarly, a state legislature might conclude that very dangerous individuals, whatever their age, should not be confined in the same facility with more vulnerable juvenile offenders. Such reasons would suggest nothing about the appropriateness of capital punishment for 15-year-olds. The absence of any such implication is illustrated by the very States that the dissent cites as evidence of a trend toward lowering the age at which juveniles may be punished as adults. See post, at 867, and n. 3. New York, *851 which recently adopted legislation allowing juveniles as young as 13 to be tried as adults, does not authorize capital punishment under any circumstances. In New Jersey, which now permits some 14-year-olds to be tried as adults, the minimum age for capital punishment is 18. In both cases, therefore, the decisions to lower the age at which some juveniles may be treated as adults must have been based on reasons quite separate from the legislatures' views about the minimum age at which a crime should render a juvenile eligible for the death penalty.
Nor have we been shown evidence that other legislatures directly considered the fact that the interaction between their capital punishment statutes and their juvenile offender statutes could in theory lead to executions for crimes committed before the age of 16. The very real possibility that this result was not considered is illustrated by the recent federal legislation, cited by the dissent, which lowers to 15 the age at which a defendant may be tried as an adult. See post, at 865 (discussing Comprehensive Crime Control Act of 1984, Pub. L. 98-473, 98 Stat. 2149). Because a number of federal statutes have long provided for capital punishment, see post, at 866, n. 1, this legislation appears to imply that 15-year-olds may now be rendered death eligible under federal law. The dissent does not point to any legislative history suggesting that Congress considered this implication when it enacted the Comprehensive Crime Control Act. The apparent absence of such legislative history is especially striking in light of the fact that the United States has agreed by treaty to set a minimum age of 18 for capital punishment in certain circumstances. See Article 68 of the Geneva Convention Relative to the Protection of Civilian Persons in Time of War, August 12, 1949, [1955] 6 U. S. T. 3516, 3560, T. I. A. S. No. 3365 (rules pertaining to military occupation); ante, at 831, n. 34; see also ibid. (citing two other international agreements, signed but not ratified by the United States, prohibiting capital punishment for juveniles). Perhaps even more striking is *852 the fact that the United States Senate recently passed a bill authorizing capital punishment for certain drug offenses, but prohibiting application of this penalty to persons below the age of 18 at the time of the crime. 134 Cong. Rec. 14117, 14118 (1988). Whatever other implications the ratification of Article 68 of the Geneva Convention may have, and whatever effects the Senate's recent action may eventually have, both tend to undercut any assumption that the Comprehensive Crime Control Act signals a decision by Congress to authorize the death penalty for some 15-year-old felons.
Thus, there is no indication that any legislative body in this country has rendered a considered judgment approving the imposition of capital punishment on juveniles who were below the age of 16 at the time of the offense. It nonetheless is true, although I think the dissent has overstated its significance, that the Federal Government and 19 States have adopted statutes that appear to have the legal effect of rendering some of these juveniles death eligible. That fact is a real obstacle in the way of concluding that a national consensus forbids this practice. It is appropriate, therefore, to examine other evidence that might indicate whether or not these statutes are inconsistent with settled notions of decency in our society.
In previous cases, we have examined execution statistics, as well as data about jury determinations, in an effort to discern whether the application of capital punishment to certain classes of defendants has been so aberrational that it can be considered unacceptable in our society. See, e. g., Coker v. Georgia, 433 U.S. 584, 592 (1977) (plurality opinion); Enmund v. Florida, 458 U.S. 782, 794-796 (1982); id., at 818-819 (O'CONNOR, J., dissenting). In this case, the plurality emphasizes that four decades have gone by since the last execution of a defendant who was younger than 16 at the time of the offense, and that only 5 out of 1,393 death sentences during a recent 5-year period involved such defendants. *853 Ante, at 832-833. Like the statistics about the behavior of legislatures, these execution and sentencing statistics support the inference of a national consensus opposing the death penalty for 15-year-olds, but they are not dispositive.
A variety of factors, having little or nothing to do with any individual's blameworthiness, may cause some groups in our population to commit capital crimes at a much lower rate than other groups. The statistics relied on by the plurality, moreover, do not indicate how many juries have been asked to impose the death penalty for crimes committed below the age of 16, or how many times prosecutors have exercised their discretion to refrain from seeking the death penalty in cases where the statutory prerequisites might have been proved. Without such data, raw execution and sentencing statistics cannot allow us reliably to infer that juries are or would be significantly more reluctant to impose the death penalty on 15-year-olds than on similarly situated older defendants.
Nor, finally, do I believe that this case can be resolved through the kind of disproportionality analysis employed in Part V of the plurality opinion. I agree that "proportionality requires a nexus between the punishment imposed and the defendant's blameworthiness." Enmund, supra, at 825 (O'CONNOR, J., dissenting); see also Tison v. Arizona, 481 U.S. 137 (1987). Granting the plurality's other premise that adolescents are generally less blameworthy than adults who commit similar crimes it does not necessarily follow that all 15-year-olds are incapable of the moral culpability that would justify the imposition of capital punishment. Nor has the plurality educed evidence demonstrating that 15-years-olds as a class are inherently incapable of being deterred from major crimes by the prospect of the death penalty.
Legislatures recognize the relative immaturity of adolescents, and we have often permitted them to define age-based classes that take account of this qualitative difference between juveniles and adults. See, e. g., Hazelwood School *854 District v. Kuhlmeier, 484 U.S. 260 (1988); Schall v. Martin, 467 U.S. 253 (1984); McKeiver v. Pennsylvania, 403 U.S. 528 (1971); Ginsberg v. New York, 390 U.S. 629 (1968). But compare Planned Parenthood of Central Missouri v. Danforth, 428 U.S. 52, 74-75 (1976) (unconstitutional for a legislature to presume that all minors are incapable of providing informed consent to abortion), and Bellotti v. Baird, 443 U.S. 622, 654 (1979) (STEVENS, J., joined by BRENNAN, MARSHALL, and BLACKMUN, JJ., concurring in judgment) (same), with Akron v. Akron Center for Reproductive Health, Inc., 462 U.S. 416, 469, n. 12 (1983) (O'CONNOR, J., dissenting) (Parental notification requirements may be constitutional). The special qualitative characteristics of juveniles that justify legislatures in treating them differently from adults for many other purposes are also relevant to Eighth Amendment proportionality analysis. These characteristics, however, vary widely among different individuals of the same age, and I would not substitute our inevitably subjective judgment about the best age at which to draw a line in the capital punishment context for the judgments of the Nation's legislatures. Cf. Enmund, supra, at 826, and n. 42 (O'CONNOR, J., dissenting).
The history of the death penalty instructs that there is danger in inferring a settled societal consensus from statistics like those relied on in this case. In 1846, Michigan became the first State to abolish the death penalty for all crimes except treason, and Rhode Island soon thereafter became the first jurisdiction to abolish capital punishment completely. F. Zimring & G. Hawkins, Capital Punishment and the American Agenda 28 (1986). In succeeding decades, other American States continued the trend towards abolition, especially during the years just before and during World War I. Id., at 28-29. Later, and particularly after World War II, there ensued a steady and dramatic decline in executions both in absolute terms and in relation to the number of homicides occurring in the country. W. Bowers, Legal Homicide *855 26-28 (1984). In the 1950's and 1960's, more States abolished or radically restricted capital punishment, and executions ceased completely for several years beginning in 1968. H. Bedau, The Death Penalty in America 23, 25 (3d ed. 1982).
In 1972, when this Court heard arguments on the constitutionality of the death penalty, such statistics might have suggested that the practice had become a relic, implicitly rejected by a new societal consensus. Indeed, counsel urged the Court to conclude that "the number of cases in which the death penalty is imposed, as compared with the number of cases in which it is statutorily available, reflects a general revulsion toward the penalty that would lead to its repeal if only it were more generally and widely enforced." Furman v. Georgia, 408 U.S. 238, 386 (1972) (Burger, C. J., dissenting). We now know that any inference of a societal consensus rejecting the death penalty would have been mistaken. But had this Court then declared the existence of such a consensus, and outlawed capital punishment, legislatures would very likely not have been able to revive it. The mistaken premise of the decision would have been frozen into constitutional law, making it difficult to refute and even more difficult to reject.
The step that the plurality would take today is much narrower in scope, but it could conceivably reflect an error similar to the one we were urged to make in Furman. The day may come when we must decide whether a legislature may deliberately and unequivocally resolve upon a policy authorizing capital punishment for crimes committed at the age of 15. In that event, we shall have to decide the Eighth Amendment issue that divides the plurality and the dissent in this case, and we shall have to evaluate the evidence of societal standards of decency that is available to us at that time. In my view, however, we need not and should not decide the question today.
*856 II
Under the Eighth Amendment, the death penalty has been treated differently from all other punishments. See, e. g., California v. Ramos, 463 U.S. 992, 998-999, and n. 9 (1983). Among the most important and consistent themes in this Court's death penalty jurisprudence is the need for special care and deliberation in decisions that may lead to the imposition of that sanction. The Court has accordingly imposed a series of unique substantive and procedural restrictions designed to ensure that capital punishment is not imposed without the serious and calm reflection that ought to precede any decision of such gravity and finality.
The restrictions that we have required under the Eighth Amendment affect both legislatures and the sentencing authorities responsible for decisions in individual cases. Neither automatic death sentences for certain crimes, for example, nor statutes committing the sentencing decision to the unguided discretion of judges or juries, have been upheld. See, e. g., Woodson v. North Carolina, 428 U.S. 280 (1976); Roberts v. Louisiana, 428 U.S. 325 (1976); Gregg v. Georgia, 428 U.S. 153, 188-189 (1976) (opinion of Stewart, Powell, and STEVENS, JJ.) (discussing Furman v. Georgia, supra). We have rejected both legislative restrictions on the mitigating evidence that a sentencing authority may consider, e. g., Lockett v. Ohio, 438 U.S. 586 (1978); Eddings v. Oklahoma, 455 U.S. 104 (1982), and the lack of sufficiently precise restrictions on the aggravating circumstances that may be considered, e. g., Godfrey v. Georgia, 446 U.S. 420 (1980). As a practical matter we have virtually required that the death penalty be imposed only when a guilty verdict has been followed by separate trial-like sentencing proceedings, and we have extended many of the procedural restrictions applicable during criminal trials into these proceedings. See, e. g., Gardner v. Florida, 430 U.S. 349 (1977); Estelle v. Smith, 451 U.S. 454 (1981); Bullington v. Missouri, 451 U.S. 430 *857 (1981). Legislatures have been forbidden to authorize capital punishment for certain crimes. Coker v. Georgia, 433 U.S. 584 (1977); Enmund v. Florida, 458 U.S. 782 (1982); see also Ford v. Wainwright, 477 U.S. 399 (1986) (Eighth Amendment forbids the execution of insane prisoners). Constitutional scrutiny in this area has been more searching than in the review of noncapital sentences. See Enmund v. Florida, supra, at 815, n. 27 (O'CONNOR, J., dissenting); Rummel v. Estelle, 445 U.S. 263, 272 (1980).
The case before us today raises some of the same concerns that have led us to erect barriers to the imposition of capital punishment in other contexts. Oklahoma has enacted a statute that authorizes capital punishment for murder, without setting any minimum age at which the commission of murder may lead to the imposition of that penalty. The State has also, but quite separately, provided that 15-year-old murder defendants may be treated as adults in some circumstances. Because it proceeded in this manner, there is a considerable risk that the Oklahoma Legislature either did not realize that its actions would have the effect of rendering 15-year-old defendants death eligible or did not give the question the serious consideration that would have been reflected in the explicit choice of some minimum age for death eligibility. Were it clear that no national consensus forbids the imposition of capital punishment for crimes committed before the age of 16, the implicit nature of the Oklahoma Legislature's decision would not be constitutionally problematic. In the peculiar circumstances we face today, however, the Oklahoma statutes have presented this Court with a result that is of very dubious constitutionality, and they have done so without the earmarks of careful consideration that we have required for other kinds of decisions leading to the death penalty. In this unique situation, I am prepared to conclude that petitioner and others who were below the age of 16 at the time of their offense may not be executed under the authority of a capital punishment statute that specifies no minimum *858 age at which the commission of a capital crime can lead to the offender's execution.[*]
The conclusion I have reached in this unusual case is itself unusual. I believe, however, that it is in keeping with the principles that have guided us in other Eighth Amendment cases. It is also supported by the familiar principle applied in different ways in different contexts according to which we should avoid unnecessary, or unnecessarily broad, constitutional adjudication. See generally, e. g., Ashwander v. TVA, 297 U.S. 288, 341-356 (1936) (Brandeis, J., concurring). The narrow conclusion I have reached in this case is consistent with the underlying rationale for that principle, which was articulated many years ago by Justice Jackson: "We are not final because we are infallible, but we are infallible only because we are final." Brown v. Allen, 344 U.S. 443, 540 (1953) (opinion concurring in result); see also Califano v. Yamasaki, 442 U.S. 682, 692-693 (1979). By leaving open for now the broader Eighth Amendment question that both the plurality and the dissent would resolve, the approach I take allows the ultimate moral issue at stake in the constitutional question to be addressed in the first instance *859A by those best suited to do so, the people's elected representatives.
For the reasons stated in this opinion, I agree that petitioner's death sentence should be vacated, and I therefore concur in the judgment of the Court. | The plurality and dissent agree on two fundamental propositions: that there is some age below which a juvenile's crimes can never be constitutionally punished by death, and that our precedents require us to locate this age in light of the " `evolving standards of decency that mark the progress of a maturing society.' " See ante, at 821 ); ante, at 827-829; post, at 864-865, 872. See also, e. g., I accept both principles. The disagreements between the plurality and the dissent rest on their different evaluations of the evidence available to us about the relevant social consensus. Although I believe that a national consensus forbidding the execution of any person *849 for a crime committed before the age of 16 very likely does exist, I am reluctant to adopt this conclusion as a matter of constitutional law without better evidence than we now possess. Because I conclude that the sentence in this case can and should be set aside on narrower grounds than those adopted by the plurality, and because the grounds on which I rest should allow us to face the more general question when better evidence is available, I concur only in the judgment of the Court. I Both the plurality and the dissent look initially to the decisions of American legislatures for signs of a national consensus about the minimum age at which a juvenile's crimes may lead to capital punishment. Although I agree with the dissent's contention, post, at 865, that these decisions should provide the most reliable signs of a society-wide consensus on this issue, I cannot agree with the dissent's interpretation of the evidence. The most salient statistic that bears on this case is that every single American legislature that has expressly set a minimum age for capital punishment has set that age at 16 or above. See ante, at 829, and n. 30. When one adds these 18 States to the 14 that have rejected capital punishment completely, see ante, and n. 25, it appears that almost two-thirds of the state legislatures have definitely concluded that no 15-year-old should be exposed to the threat of execution. See also ante, at 829, n. 29 (pointing out that an additional two States with death penalty statutes on their books seem to have abandoned capital punishment in practice). Where such a large majority of the state legislatures have unambiguously outlawed capital punishment for 15-year-olds, and where no legislature in this country has affirmatively and unequivocally endorsed such a practice, strong counterevidence would be required to persuade me that a national consensus against this practice does not exist. *850 The dissent argues that it has found such counterevidence in the laws of the 19 States that authorize capital punishment without setting any statutory minimum age. If we could be sure that each of these 19 state legislatures had deliberately chosen to authorize capital punishment for crimes committed at the age of 15, one could hardly suppose that there is a settled national consensus opposing such a practice. In fact, however, the statistics relied on by the dissent may be quite misleading. When a legislature provides for some 15-year-olds to be processed through the adult criminal justice system, and capital punishment is available for adults in that jurisdiction, the death penalty becomes at least theoretically applicable to such defendants. This is how petitioner was rendered death eligible, and the same possibility appears to exist in 18 other States. See post, at 861-862; ante, at 828, n. 26. As the plurality points out, however, it does not necessarily follow that the legislatures in those jurisdictions have deliberately concluded that it would be appropriate to impose capital punishment on 15-year-olds (or on even younger defendants who may be tried as adults in some jurisdictions). See ante, n. 24. There are many reasons, having nothing whatsoever to do with capital punishment, that might motivate a legislature to provide as a general matter for some 15-year-olds to be channeled into the adult criminal justice process. The length or conditions of confinement available in the juvenile system, for example, might be considered inappropriate for serious crimes or for some recidivists. Similarly, a state legislature might conclude that very dangerous individuals, whatever their age, should not be confined in the same facility with more vulnerable juvenile offenders. Such reasons would suggest nothing about the appropriateness of capital punishment for 15-year-olds. The absence of any such implication is illustrated by the very States that the dissent cites as evidence of a trend toward lowering the age at which juveniles may be punished as adults. See post, at 867, and n. 3. New York, *851 which recently adopted legislation allowing juveniles as young as 13 to be tried as adults, does not authorize capital punishment under any circumstances. In New Jersey, which now permits some 14-year-olds to be tried as adults, the minimum age for capital punishment is 18. In both cases, therefore, the decisions to lower the age at which some juveniles may be treated as adults must have been based on reasons quite separate from the legislatures' views about the minimum age at which a crime should render a juvenile eligible for the death penalty. Nor have we been shown evidence that other legislatures directly considered the fact that the interaction between their capital punishment statutes and their juvenile offender statutes could in theory lead to executions for crimes committed before the age of 16. The very real possibility that this result was not considered is illustrated by the recent federal legislation, cited by the dissent, which lowers to 15 the age at which a defendant may be tried as an adult. See post, at 865 (discussing Comprehensive Crime Control Act of 1984, Stat. 2149). Because a number of federal statutes have long provided for capital punishment, see post, at 866, n. 1, this legislation appears to imply that 15-year-olds may now be rendered death eligible under federal law. The dissent does not point to any legislative history suggesting that Congress considered this implication when it enacted the Comprehensive Crime Control Act. The apparent absence of such legislative history is especially striking in light of the fact that the United States has agreed by treaty to set a minimum age of 18 for capital punishment in certain circumstances. See Article 68 of the Geneva Convention Relative to the Protection of Civilian Persons in Time of War, August 12, 1949, [1955] 6 U. S. T. 3516, 3560, T. I. A. S. No. 3365 (rules pertaining to military occupation); ante, at 831, n. 34; see also (citing two other international agreements, signed but not ratified by the United States, prohibiting capital punishment for juveniles). Perhaps even more striking is *852 the fact that the United States Senate recently passed a bill authorizing capital punishment for certain drug offenses, but prohibiting application of this penalty to persons below the age of 18 at the time of the crime. 134 Cong. Rec. 14117, 14118 Whatever other implications the ratification of Article 68 of the Geneva Convention may have, and whatever effects the Senate's recent action may eventually have, both tend to undercut any assumption that the Comprehensive Crime Control Act signals a decision by Congress to authorize the death penalty for some 15-year-old felons. Thus, there is no indication that any legislative body in this country has rendered a considered judgment approving the imposition of capital punishment on juveniles who were below the age of 16 at the time of the offense. It nonetheless is true, although I think the dissent has overstated its significance, that the Federal Government and 19 States have adopted statutes that appear to have the legal effect of rendering some of these juveniles death eligible. That fact is a real obstacle in the way of concluding that a national consensus forbids this practice. It is appropriate, therefore, to examine other evidence that might indicate whether or not these statutes are inconsistent with settled notions of decency in our society. In previous cases, we have examined execution statistics, as well as data about jury determinations, in an effort to discern whether the application of capital punishment to certain classes of defendants has been so aberrational that it can be considered unacceptable in our society. See, e. g., ; ; In this case, the plurality emphasizes that four decades have gone by since the last execution of a defendant who was younger than 16 at the time of the offense, and that only 5 out of 1,393 death sentences during a recent 5-year period involved such defendants. *853 Ante, at 832-833. Like the statistics about the behavior of legislatures, these execution and sentencing statistics support the inference of a national consensus opposing the death penalty for 15-year-olds, but they are not dispositive. A variety of factors, having little or nothing to do with any individual's blameworthiness, may cause some groups in our population to commit capital crimes at a much lower rate than other groups. The statistics relied on by the plurality, moreover, do not indicate how many juries have been asked to impose the death penalty for crimes committed below the age of 16, or how many times prosecutors have exercised their discretion to refrain from seeking the death penalty in cases where the statutory prerequisites might have been proved. Without such data, raw execution and sentencing statistics cannot allow us reliably to infer that juries are or would be significantly more reluctant to impose the death penalty on 15-year-olds than on similarly situated older defendants. Nor, finally, do I believe that this case can be resolved through the kind of disproportionality analysis employed in Part V of the plurality opinion. I agree that "proportionality requires a nexus between the punishment imposed and the defendant's blameworthiness." ; see also Granting the plurality's other premise that adolescents are generally less blameworthy than adults who commit similar crimes it does not necessarily follow that all 15-year-olds are incapable of the moral culpability that would justify the imposition of capital punishment. Nor has the plurality educed evidence demonstrating that 15-years-olds as a class are inherently incapable of being deterred from major crimes by the prospect of the death penalty. Legislatures recognize the relative immaturity of adolescents, and we have often permitted them to define age-based classes that take account of this qualitative difference between juveniles and adults. See, e. g., Hazelwood School *854 ; ; ; But compare Planned Parenthood of Central and (same), with (Parental notification requirements may be constitutional). The special qualitative characteristics of juveniles that justify legislatures in treating them differently from adults for many other purposes are also relevant to Eighth Amendment proportionality analysis. These characteristics, however, vary widely among different individuals of the same age, and I would not substitute our inevitably subjective judgment about the best age at which to draw a line in the capital punishment context for the judgments of the Nation's legislatures. Cf. and n. 42 The history of the death penalty instructs that there is danger in inferring a settled societal consensus from statistics like those relied on in this case. In 1846, Michigan became the first State to abolish the death penalty for all crimes except treason, and Rhode Island soon thereafter became the first jurisdiction to abolish capital punishment completely. F. Zimring & G. Hawkins, Capital Punishment and the American Agenda 28 In succeeding decades, other American States continued the trend towards abolition, especially during the years just before and during World War I. Later, and particularly after World War II, there ensued a steady and dramatic decline in executions both in absolute terms and in relation to the number of homicides occurring in the country. W. Bowers, Legal Homicide *855 26-28 In the 1950's and 1960's, more States abolished or radically restricted capital punishment, and executions ceased completely for several years beginning in 1968. H. Bedau, The Death Penalty in America 23, 25 In 1972, when this Court heard arguments on the constitutionality of the death penalty, such statistics might have suggested that the practice had become a relic, implicitly rejected by a new societal consensus. Indeed, counsel urged the Court to conclude that "the number of cases in which the death penalty is imposed, as compared with the number of cases in which it is statutorily available, reflects a general revulsion toward the penalty that would lead to its repeal if only it were more generally and widely enforced." We now know that any inference of a societal consensus rejecting the death penalty would have been mistaken. But had this Court then declared the existence of such a consensus, and outlawed capital punishment, legislatures would very likely not have been able to revive it. The mistaken premise of the decision would have been frozen into constitutional law, making it difficult to refute and even more difficult to reject. The step that the plurality would take today is much narrower in scope, but it could conceivably reflect an error similar to the one we were urged to make in Furman. The day may come when we must decide whether a legislature may deliberately and unequivocally resolve upon a policy authorizing capital punishment for crimes committed at the age of 15. In that event, we shall have to decide the Eighth Amendment issue that divides the plurality and the dissent in this case, and we shall have to evaluate the evidence of societal standards of decency that is available to us at that time. In my view, however, we need not and should not decide the question today. *856 II Under the Eighth Amendment, the death penalty has been treated differently from all other punishments. See, e. g., Among the most important and consistent themes in this Court's death penalty jurisprudence is the need for special care and deliberation in decisions that may lead to the imposition of that sanction. The Court has accordingly imposed a series of unique substantive and procedural restrictions designed to ensure that capital punishment is not imposed without the serious and calm reflection that ought to precede any decision of such gravity and finality. The restrictions that we have required under the Eighth Amendment affect both legislatures and the sentencing authorities responsible for decisions in individual cases. Neither automatic death sentences for certain crimes, for example, nor statutes committing the sentencing decision to the unguided discretion of judges or juries, have been upheld. See, e. g., ; ; ; and the lack of sufficiently precise restrictions on the aggravating circumstances that may be considered, e. g., Godfrey v. As a practical matter we have virtually required that the death penalty be imposed only when a guilty verdict has been followed by separate trial-like sentencing proceedings, and we have extended many of the procedural restrictions applicable during criminal trials into these proceedings. See, e. g., ; ; Legislatures have been forbidden to authorize capital punishment for certain crimes. ; ; see also Constitutional scrutiny in this area has been more searching than in the review of noncapital sentences. See ; The case before us today raises some of the same concerns that have led us to erect barriers to the imposition of capital punishment in other contexts. Oklahoma has enacted a statute that authorizes capital punishment for murder, without setting any minimum age at which the commission of murder may lead to the imposition of that penalty. The State has also, but quite separately, provided that 15-year-old murder defendants may be treated as adults in some circumstances. Because it proceeded in this manner, there is a considerable risk that the Oklahoma Legislature either did not realize that its actions would have the effect of rendering 15-year-old defendants death eligible or did not give the question the serious consideration that would have been reflected in the explicit choice of some minimum age for death eligibility. Were it clear that no national consensus forbids the imposition of capital punishment for crimes committed before the age of 16, the implicit nature of the Oklahoma Legislature's decision would not be constitutionally problematic. In the peculiar circumstances we face today, however, the Oklahoma statutes have presented this Court with a result that is of very dubious constitutionality, and they have done so without the earmarks of careful consideration that we have required for other kinds of decisions leading to the death penalty. In this unique situation, I am prepared to conclude that petitioner and others who were below the age of 16 at the time of their offense may not be executed under the authority of a capital punishment statute that specifies no minimum *858 age at which the commission of a capital crime can lead to the offender's execution.[*] The conclusion I have reached in this unusual case is itself unusual. I believe, however, that it is in keeping with the principles that have guided us in other Eighth Amendment cases. It is also supported by the familiar principle applied in different ways in different contexts according to which we should avoid unnecessary, or unnecessarily broad, constitutional adjudication. See generally, e. g., The narrow conclusion I have reached in this case is consistent with the underlying rationale for that principle, which was articulated many years ago by Justice Jackson: "We are not final because we are infallible, but we are infallible only because we are final." ; see also By leaving open for now the broader Eighth Amendment question that both the plurality and the dissent would resolve, the approach I take allows the ultimate moral issue at stake in the constitutional question to be addressed in the first instance *859A by those best suited to do so, the people's elected representatives. For the reasons stated in this opinion, I agree that petitioner's death sentence should be vacated, and I therefore concur in the judgment of the Court. |
Justice Stevens | dissenting | false | Young v. Community Nutrition Institute | 1986-06-17T00:00:00 | null | https://www.courtlistener.com/opinion/111698/young-v-community-nutrition-institute/ | https://www.courtlistener.com/api/rest/v3/clusters/111698/ | 1,986 | 1985-114 | 1 | 8 | 1 | The parties agree that aflatoxins are added, unavoidable contaminants of food and as such are governed by the following provision of the Federal Food, Drug, and Cosmetic Act:
"[W]hen such substance . . . cannot be so avoided, the Secretary shall promulgate regulations limiting the quantity therein or thereon to such extent as he finds necessary for the protection of public health, and any quantity exceeding the limits so fixed shall also be deemed to be unsafe for purposes of the application of clause (2)(A) of section 342(a) of this title." 21 U.S. C. § 346 (emphasis added).
To one versed in the English language, the meaning of this provision is readily apparent. The plain language of the section tells us when the Secretary's duty to promulgate regulations arises "when such substance . . . cannot be so avoided"; it tells us the purpose of the regulations to establish *985 a tolerance level that will enable manufacturers to know what they can lawfully produce and to enable the public to know what they can safely consume; and it tells us what standard he should employ in drafting them "to such extent as he finds necessary for the protection of public health." For purposes of deciding this case, the parties' agreement that aflatoxins are substances that "cannot be so avoided" within the meaning of the section triggers the obligation to initiate rulemaking.
The Court's contrary conclusion reflects an absence of judgment and of judging. Before exploring either infirmity, it is worthwhile to summarize the Court's reason for reading the section to authorize, but not require, the promulgation of regulations. First, the Court declares that the qualifying language "to such extent as he finds necessary for protection of the public health" is a "dangling participle" that might or might not modify the words "shall promulgate regulations." Ante, at 981. Second, as between the two readings of this "ambiguous statutory provision," ibid., deference dictates that the Commissioner of the Food and Drug Administration (FDA) (to whom enforcement of the Act has been delegated) may take his pick.
The Court's finding of ambiguity is simply untenable. The antecedent of the qualifying language is quite clearly the phrase "limiting the quantity therein or thereon," which immediately precedes it, rather than the word "shall," which appears eight words before it. Thus, the Commissioner is to "limi[t] the quantity [of an added, unavoidable poisonous or deleterious substance] therein or thereon to such extent as he finds necessary for the protection of public health."[1] By instead *986 reading the section to mean that "the Secretary shall promulgate regulations . . . to such extent as he finds necessary," the Court ignores the import of the words immediately following, which specify the effect of the "limits so fixed" i. e., fixed by "limiting the quantity [of the poisonous substance] therein or thereon to such extent as he finds necessary for the protection of public health" which can only mean that the qualification modifies the limits set by regulation rather than the duty to regulate. In addition, the Court's construction, by skipping over the words "limiting the quantity therein or thereon," renders them superfluous and of no operative force or effect. Indeed, the Court renders the very language it construes superfluous, because reading the provision to authorize (rather than mandate) the promulgation of regulations assigns it an office already filled by the general rulemaking authority conferred later in the Food, Drug, and Cosmetic Act. See 21 U.S. C. § 371(a).[2] If Congress intended the Secretary to have unbridled authority to proceed with action levels, instead of with formal regulations, there was no need to enact this part of § 346 at all. This is plainly a case in which "the intent of Congress is clear [and] the court, as well as the agency, must give effect to the *987 unambiguously expressed intent of Congress." Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-843 (1984).[3]
*988 The task of interpreting a statute requires more than merely inventing an ambiguity and invoking administrative deference. A statute is not "unclear unless we think there are decent arguments for each of two competing interpretations of it." R. Dworkin, Law's Empire 352 (1986). Thus, to say that the statute is susceptible of two meanings, as does the Court, is not to say that either is acceptable. Furthermore, to say that the Commissioner's interpretation of the statute merits deference, as does the Court, is not to say that the singularly judicial role of marking the boundaries of agency choice is at an end. As Justice Frankfurter reminds us, "[t]he purpose of construction being the ascertainment of meaning, every consideration brought to bear for the solution of that problem must be devoted to that end alone." Frankfurter, Some Reflections on the Reading of Statutes, 47 Colum. L. Rev. 527, 529 (1947). It is not "a ritual to be observed by unimaginative adherence to well-worn professional phrases." Ibid. "Nor can canons of construction save us from the anguish of judgment." Id., at 544. The Court, correctly self-conscious of the limits of the judicial role, employs a reasoning so formulaic that it trivializes the art of judging.
I respectfully dissent.
| The parties agree that aflatoxins are added, unavoidable contaminants of food and as such are governed by the following provision of the Federal Food, Drug, and Cosmetic Act: "[W]hen such substance cannot be so avoided, the Secretary shall promulgate regulations limiting the quantity therein or thereon to such extent as he finds necessary for the protection of public health, and any quantity exceeding the limits so fixed shall also be deemed to be unsafe for purposes of the application of clause (2)(A) of section 342(a) of this title." 21 U.S. C. 346 (emphasis added). To one versed in the English language, the meaning of this provision is readily apparent. The plain language of the section tells us when the Secretary's duty to promulgate regulations arises "when such substance cannot be so avoided"; it tells us the purpose of the regulations to establish *985 a tolerance level that will enable manufacturers to know what they can lawfully produce and to enable the public to know what they can safely consume; and it tells us what standard he should employ in drafting them "to such extent as he finds necessary for the protection of public health." For purposes of deciding this case, the parties' agreement that aflatoxins are substances that "cannot be so avoided" within the meaning of the section triggers the obligation to initiate rulemaking. The Court's contrary conclusion reflects an absence of judgment and of judging. Before exploring either infirmity, it is worthwhile to summarize the Court's reason for reading the section to authorize, but not require, the promulgation of regulations. First, the Court declares that the qualifying language "to such extent as he finds necessary for protection of the public health" is a "dangling participle" that might or might not modify the words "shall promulgate regulations." Ante, at 981. Second, as between the two readings of this "ambiguous statutory provision," ibid., deference dictates that the Commissioner of the Food and Drug Administration (FDA) (to whom enforcement of the Act has been delegated) may take his pick. The Court's finding of ambiguity is simply untenable. The antecedent of the qualifying language is quite clearly the phrase "limiting the quantity therein or thereon," which immediately precedes it, rather than the word "shall," which appears eight words before it. Thus, the Commissioner is to "limi[t] the quantity [of an added, unavoidable poisonous or deleterious substance] therein or thereon to such extent as he finds necessary for the protection of public health."[1] By instead *986 reading the section to mean that "the Secretary shall promulgate regulations to such extent as he finds necessary," the Court ignores the import of the words immediately following, which specify the effect of the "limits so fixed" i. e., fixed by "limiting the quantity [of the poisonous substance] therein or thereon to such extent as he finds necessary for the protection of public health" which can only mean that the qualification modifies the limits set by regulation rather than the duty to regulate. In addition, the Court's construction, by skipping over the words "limiting the quantity therein or thereon," renders them superfluous and of no operative force or effect. Indeed, the Court renders the very language it construes superfluous, because reading the provision to authorize (rather than mandate) the promulgation of regulations assigns it an office already filled by the general rulemaking authority conferred later in the Food, Drug, and Cosmetic Act. See 21 U.S. C. 371(a).[2] If Congress intended the Secretary to have unbridled authority to proceed with action levels, instead of with formal regulations, there was no need to enact this part of 346 at all. This is plainly a case in which "the intent of Congress is clear [and] the court, as well as the agency, must give effect to the *987 unambiguously expressed intent of Congress." Chevron U. S. A.[3] *988 The task of interpreting a statute requires more than merely inventing an ambiguity and invoking administrative deference. A statute is not "unclear unless we think there are decent arguments for each of two competing interpretations of it." R. Dworkin, Law's Empire 352 (1986). Thus, to say that the statute is susceptible of two meanings, as does the Court, is not to say that either is acceptable. Furthermore, to say that the Commissioner's interpretation of the statute merits deference, as does the Court, is not to say that the singularly judicial role of marking the boundaries of agency choice is at an end. As Justice Frankfurter reminds us, "[t]he purpose of construction being the ascertainment of meaning, every consideration brought to bear for the solution of that problem must be devoted to that end alone." Frankfurter, Some Reflections on the Reading of Statutes, It is not "a ritual to be observed by unimaginative adherence to well-worn professional phrases." "Nor can canons of construction save us from the anguish of judgment." The Court, correctly self-conscious of the limits of the judicial role, employs a reasoning so formulaic that it trivializes the art of judging. I respectfully dissent. |
Justice Stevens | majority | false | Laborers Tr. Fund v. Advanced Lightweight Conc. | 1988-02-23T00:00:00 | null | https://www.courtlistener.com/opinion/111991/laborers-tr-fund-v-advanced-lightweight-conc/ | https://www.courtlistener.com/api/rest/v3/clusters/111991/ | 1,988 | 1987-031 | 1 | 8 | 0 | A company that is a party to a collective-bargaining agreement may have a contractual duty to make contributions to a pension fund during the term of the agreement and, in addition, may have a duty under the National Labor Relations Act (NLRA) to continue making such contributions after the expiration of the contract and while negotiations for a new contract are in process. In 1980, Congress amended the Employee Retirement Income Security Act (ERISA) to provide trustees of multiemployer benefit plans with an effective federal remedy to collect delinquent contributions. The question presented in this case is whether that remedy encompasses actions based on an alleged breach of the employer's statutory duty as well as those based on an alleged breach of contract. We agree with the Court of Appeals' conclusion that the remedy is limited to the collection of "promised contributions."
I
Prior to 1983, respondent was a member of the Associated General Contractors of California and a party to two multiemployer collective-bargaining agreements negotiated on its *542 behalf by that association.[1] The agreements included provisions requiring respondent to make monthly contributions to eight different employee benefit plans.[2] The collective-bargaining agreements, which were executed in 1980, had an expiration date of June 15, 1983.
On April 1, 1983, respondent notified both unions that it had terminated the association's authority to bargain on its behalf, that it would not be bound by either master agreement (or any successor agreement) after the June 15, 1983, expiration date, and that it was prepared to negotiate with the unions independently. Respondent continued to contribute to the eight trust funds until June 15, 1983, but has made no contributions since that date.
In December 1983, the trustees of the eight plans (petitioners)[3] brought suit in the Federal District Court for the Northern District of California against respondent to collect contributions for the period after June 15, 1983. Petitioners allege that respondent's unilateral decision to change the terms and conditions of employment by discontinuing its contributions constituted a breach of its duty to bargain in good faith and violated § 8(a)(5) of the NLRA. 61 Stat. 141, 29 *543 U. S. C. § 158(a)(5). The complaints alleged that the federal court had jurisdiction under §§ 502(g)(2) and 515 of ERISA.[4]
Respondent's answer to the complaint challenged the District Court's jurisdiction and also denied that respondent had any statutory duty to make contributions to the funds because its negotiations with the unions had reached an "impasse."[5] The "impasse" issue has never been resolved *544 because the District Court granted a motion for summary judgment based on two other grounds: That § 515 of ERISA does not apply to an employer's obligations under § 8(a)(5) of the NLRA; and that the National Labor Relations Board (NLRB) has exclusive jurisdiction over petitioners' claims.
The Court of Appeals affirmed. 779 F.2d 497 (CA9 1985). It necessarily assumed that petitioner could prove that respondent's postcontract refusal to contribute to the funds was an unfair labor practice.[6] It held, however, that the claims should be resolved by the NLRB rather than by a federal district court. After examining the text and the legislative history of the Multiemployer Pension Plan Amendments Act of 1980 (MPPAA), the Court concluded:
*545 "We find no persuasive evidence in either the plain words or legislative history of ERISA or the MPPAA that Congress intended section 515 to be an exception to the general rule of NLRB preemption for that narrow category of suits seeking recovery of unpaid contributions accrued during the period between contract expiration and impasse." Id., at 505.[7]
We granted certiorari, 479 U.S. 1083 (1987), and now affirm.
II
In its 1980 amendments to ERISA, Congress responded to two concerns that are relevant to the question presented by this case. It was primarily concerned about the burden placed upon the remaining contributors to a multiemployer fund when one or more of them withdraw.[8] In response to this concern Congress enacted an elaborate provision imposing "withdrawal liability" on such withdrawing employers.[9] That liability arises when an employer ceases to have an "obligation to contribute" to the plan.[10] That term is defined for the purposes of the withdrawal liability portion of the statute in language that unambiguously includes both the employer's *546 contractual obligations and any obligation imposed by the NLRA.[11] That definition is significant because it demonstrates that Congress was aware of the two different sources of an employer's duty to contribute to covered plans.
Congress was also concerned about the problem that had arisen because a substantial number of employers had failed to make their "promised contributions" on a regular and timely basis.[12] Sections 515 and 502(g)(2) of ERISA, the provisions at issue in this case, were enacted in response to that concern. The text of § 515 plainly describes the employer's contractual obligation to make contributions but omits any reference to a noncontractual obligation imposed by the NLRA. Section 515 provides:
"Every employer who is obligated to make contributions to a multiemployer plan under the terms of the plan or under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such *547 contributions in accordance with the terms and conditions of such plan or such agreement." 94 Stat. 1295, 29 U.S. C. § 1145.
The liability created by § 515 may be enforced by the trustees of a plan by bringing an action in federal district court pursuant to § 502. The special remedy against employers who are delinquent in meeting their contractual obligations that is created by § 502(g)(2) includes a mandatory award of prejudgment interest plus liquidated damages in an amount at least equal to that interest, as well as attorney's fees and costs.[13]
The legislative history of these provisions explains that Congress added these strict remedies to give employers a strong incentive to honor their contractual obligations to contribute and to facilitate the collection of delinquent accounts.[14]*548 That history contains no mention of the employer's statutory duty to make postcontract contributions while negotiations for a new contract are being conducted.[15] Thus, both the *549 text and the legislative history of §§ 515 and 502(g)(2) provide firm support for the Court of Appeals' conclusion that this remedy is limited to the collection of "promised contributions" and does not confer jurisdiction on district courts to determine whether an employer's unilateral decision to refuse to make postcontract contributions constitutes a violation of the NLRA.[16]
*550 III
Petitioners, supported by the United States as Amicus Curiae, advance two policy arguments for giving § 515 a broad construction that would include postcontract delinquencies. First, they argue that the reasons for giving a district *551 court jurisdiction of collection actions apply to post-contract delinquencies as well as those arising during the term of the contract and that it is unwise to leave a "gap" in the enforcement scheme. Second, they argue that the remedies available in NLRB proceedings are inadequate.
Our principal reason for rejecting these arguments is our conviction that Congress' intent is so plain that policy arguments of this kind must be addressed to the body that has the authority to amend the legislation, rather than one whose authority is limited to interpreting it. We nevertheless note that there are countervailing policy arguments that make it highly unlikely that the limited reach of the statute is the consequence of inadvertence rather than deliberate choice.
With respect to the asserted "gap" in the enforcement scheme, three observations are pertinent. First, the incidence of the asserted gap is unknown. Presumably most employers who anticipate a continuing relationship with a union honor their obligations to preserve the status quo during negotiations for a new contract. If a new contract is ultimately signed, it should define the employer's obligations during the period subsequent to the expiration of the preceding contract; therefore, any delinquency during that period would be covered by § 515. On the other hand, if no new contract is ever signed, there is at least a possibility that an impasse had been reached either before, or only a short time after, the expiration of the old contract. The fact that this type of delinquency appears not even to have been called to the attention of Congress indicates that it may not be a problem of serious magnitude.[17]
Second, the issues that must be decided in a dispute over an employer's refusal to make any postcontract contributions are more complex than those that are presented in a simple collection action. Whereas it is entirely appropriate to *552 award prejudgment interest or liquidated damages as a remedy for an employer's failure to make the payments specified in a contract, those remedies are problematic in cases in which there is a good-faith dispute over both the existence and the extent of the employer's liability. The question whether and when an impasse has been reached is often a matter of judgment based on an evaluation of the parties' bargaining history against standards that are imprecise at best.[18]
Third, whether an employer's unilateral decision to discontinue contributions to a pension plan constitutes a violation of the statutory duty to bargain in good faith is the kind of question that is routinely resolved by the administrative agency with expertise in labor law. There are situations in which district judges must occasionally resolve labor issues, but they surely represent the exception rather than the rule. In cases like this, which involve either an actual or an "arguable" violation of § 8 of the NLRA, federal courts typically defer to the judgment of the NLRB. See San Diego Building Trades Council v. Garmon, 359 U.S. 236, 245 (1959).[19]
Petitioners may be correct in contending that the remedies available in an NLRB proceeding are less effective than an ERISA action would be. Under ERISA they are entitled to attorney's fees, prejudgment interest, and liquidated damages, *553 whereas the scope of relief available in an NLRB proceeding is often a matter of agency discretion. Moreover, an unfair labor practice charge must be filed within a 6-month period and the general counsel has discretion to refuse to issue a complaint if she is not persuaded that the charge has merit or is of sufficient importance to justify prosecution. Finally, the employer and the union may enter into a settlement that either reduces, or even might waive, the employer's postcontract obligations to contribute to the pension fund.
But these asserted defects in petitioners' labor law remedy are characteristic of all unfair labor practice proceedings before the NLRB. If the labor legislation were simply repealed, in toto, petitioners would have no basis whatsoever for claiming that an employer had any duty to continue making contributions to a fund after the expiration of its contractual commitment to do so. The duty that does exist is simply a consequence of a broader labor law duty that was created to protect the collective-bargaining process. Unilateral changes in the terms and conditions of employment are prohibited, not to vindicate the interests that motivated the enactment of § 515 in 1980, but rather to carry out the purposes of the NLRA. The net effect of the labor law duties imposed on employers by that legislation provides a substantial benefit to ERISA plan trustees, but Congress has not provided them with a unique and preferred procedure for obtaining redress for an employer's violation of its duty to bargain with the union.
The judgment of the Court of Appeals is Affirmed.
JUSTICE KENNEDY took no part in the consideration or decision of this case.
| A company that is a party to a collective-bargaining agreement may have a contractual duty to make contributions to a pension fund during the term of the agreement and, in addition, may have a duty under the National Labor Relations Act (NLRA) to continue making such contributions after the expiration of the contract and while negotiations for a new contract are in process. In 1980, Congress amended the Employee Retirement Income Security Act (ERISA) to provide trustees of multiemployer benefit plans with an effective federal remedy to collect delinquent contributions. The question presented in this case is whether that remedy encompasses actions based on an alleged breach of the employer's statutory duty as well as those based on an alleged breach of contract. We agree with the Court of Appeals' conclusion that the remedy is limited to the collection of "promised contributions." I Prior to 1983, respondent was a member of the Associated General Contractors of California and a party to two multiemployer collective-bargaining agreements negotiated on its *542 behalf by that association.[1] The agreements included provisions requiring respondent to make monthly contributions to eight different employee benefit plans.[2] The collective-bargaining agreements, which were executed in 1980, had an expiration date of June 15, 1983. On April 1, 1983, respondent notified both unions that it had terminated the association's authority to bargain on its behalf, that it would not be bound by either master agreement (or any successor agreement) after the June 15, 1983, expiration date, and that it was prepared to negotiate with the unions independently. Respondent continued to contribute to the eight trust funds until June 15, 1983, but has made no contributions since that date. In December 1983, the trustees of the eight plans (petitioners)[3] brought suit in the Federal District Court for the Northern District of California against respondent to collect contributions for the period after June 15, 1983. Petitioners allege that respondent's unilateral decision to change the terms and conditions of employment by discontinuing its contributions constituted a breach of its duty to bargain in good faith and violated 8(a)(5) of the NLRA. 29 *543 U. S. C. 158(a)(5). The complaints alleged that the federal court had jurisdiction under 502(g)(2) and 515 of ERISA.[4] Respondent's answer to the complaint challenged the District Court's jurisdiction and also denied that respondent had any statutory duty to make contributions to the funds because its negotiations with the unions had reached an "impasse."[5] The "impasse" issue has never been resolved *544 because the District Court granted a motion for summary judgment based on two other grounds: That 515 of ERISA does not apply to an employer's obligations under 8(a)(5) of the NLRA; and that the National Labor Relations Board (NLRB) has exclusive jurisdiction over petitioners' claims. The Court of Appeals affirmed. It necessarily assumed that petitioner could prove that respondent's postcontract refusal to contribute to the funds was an unfair labor practice.[6] It held, however, that the claims should be resolved by the NLRB rather than by a federal district court. After examining the text and the legislative history of the Multiemployer Pension Plan Amendments Act of 1980 (MPPAA), the Court concluded: *545 "We find no persuasive evidence in either the plain words or legislative history of ERISA or the MPPAA that Congress intended section 515 to be an exception to the general rule of NLRB preemption for that narrow category of suits seeking recovery of unpaid contributions accrued during the period between contract expiration and impasse."[7] We granted certiorari, and now affirm. II In its 1980 amendments to ERISA, Congress responded to two concerns that are relevant to the question presented by this case. It was primarily concerned about the burden placed upon the remaining contributors to a multiemployer fund when one or more of them withdraw.[8] In response to this concern Congress enacted an elaborate provision imposing "withdrawal liability" on such withdrawing employers.[9] That liability arises when an employer ceases to have an "obligation to contribute" to the plan.[10] That term is defined for the purposes of the withdrawal liability portion of the statute in language that unambiguously includes both the employer's *546 contractual obligations and any obligation imposed by the NLRA.[11] That definition is significant because it demonstrates that Congress was aware of the two different sources of an employer's duty to contribute to covered plans. Congress was also concerned about the problem that had arisen because a substantial number of employers had failed to make their "promised contributions" on a regular and timely basis.[12] Sections 515 and 502(g)(2) of ERISA, the provisions at issue in this case, were enacted in response to that concern. The text of 515 plainly describes the employer's contractual obligation to make contributions but omits any reference to a noncontractual obligation imposed by the NLRA. Section 515 provides: "Every employer who is obligated to make contributions to a multiemployer plan under the terms of the plan or under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such *547 contributions in accordance with the terms and conditions of such plan or such agreement." 29 U.S. C. 1145. The liability created by 515 may be enforced by the trustees of a plan by bringing an action in federal district court pursuant to 502. The special remedy against employers who are delinquent in meeting their contractual obligations that is created by 502(g)(2) includes a mandatory award of prejudgment interest plus liquidated damages in an amount at least equal to that interest, as well as attorney's fees and costs.[13] The legislative history of these provisions explains that Congress added these strict remedies to give employers a strong incentive to honor their contractual obligations to contribute and to facilitate the collection of delinquent accounts.[14]*548 That history contains no mention of the employer's statutory duty to make postcontract contributions while negotiations for a new contract are being conducted.[15] Thus, both the *549 text and the legislative history of 515 and 502(g)(2) provide firm support for the Court of Appeals' conclusion that this remedy is limited to the collection of "promised contributions" and does not confer jurisdiction on district courts to determine whether an employer's unilateral decision to refuse to make postcontract contributions constitutes a violation of the NLRA.[16] *550 III Petitioners, supported by the United States as Amicus Curiae, advance two policy arguments for giving 515 a broad construction that would include postcontract delinquencies. First, they argue that the reasons for giving a district *551 court jurisdiction of collection actions apply to post-contract delinquencies as well as those arising during the term of the contract and that it is unwise to leave a "gap" in the enforcement scheme. Second, they argue that the remedies available in NLRB proceedings are inadequate. Our principal reason for rejecting these arguments is our conviction that Congress' intent is so plain that policy arguments of this kind must be addressed to the body that has the authority to amend the legislation, rather than one whose authority is limited to interpreting it. We nevertheless note that there are countervailing policy arguments that make it highly unlikely that the limited reach of the statute is the consequence of inadvertence rather than deliberate choice. With respect to the asserted "gap" in the enforcement scheme, three observations are pertinent. First, the incidence of the asserted gap is unknown. Presumably most employers who anticipate a continuing relationship with a union honor their obligations to preserve the status quo during negotiations for a new contract. If a new contract is ultimately signed, it should define the employer's obligations during the period subsequent to the expiration of the preceding contract; therefore, any delinquency during that period would be covered by 515. On the other hand, if no new contract is ever signed, there is at least a possibility that an impasse had been reached either before, or only a short time after, the expiration of the old contract. The fact that this type of delinquency appears not even to have been called to the attention of Congress indicates that it may not be a problem of serious magnitude.[17] Second, the issues that must be decided in a dispute over an employer's refusal to make any postcontract contributions are more complex than those that are presented in a simple collection action. Whereas it is entirely appropriate to *552 award prejudgment interest or liquidated damages as a remedy for an employer's failure to make the payments specified in a contract, those remedies are problematic in cases in which there is a good-faith dispute over both the existence and the extent of the employer's liability. The question whether and when an impasse has been reached is often a matter of judgment based on an evaluation of the parties' bargaining history against standards that are imprecise at best.[18] Third, whether an employer's unilateral decision to discontinue contributions to a pension plan constitutes a violation of the statutory duty to bargain in good faith is the kind of question that is routinely resolved by the administrative agency with expertise in labor law. There are situations in which district judges must occasionally resolve labor issues, but they surely represent the exception rather than the rule. In cases like this, which involve either an actual or an "arguable" violation of 8 of the NLRA, federal courts typically defer to the judgment of the NLRB. See San Diego Building Trades[19] Petitioners may be correct in contending that the remedies available in an NLRB proceeding are less effective than an ERISA action would be. Under ERISA they are entitled to attorney's fees, prejudgment interest, and liquidated damages, *553 whereas the scope of relief available in an NLRB proceeding is often a matter of agency discretion. Moreover, an unfair labor practice charge must be filed within a 6-month period and the general counsel has discretion to refuse to issue a complaint if she is not persuaded that the charge has merit or is of sufficient importance to justify prosecution. Finally, the employer and the union may enter into a settlement that either reduces, or even might waive, the employer's postcontract obligations to contribute to the pension fund. But these asserted defects in petitioners' labor law remedy are characteristic of all unfair labor practice proceedings before the NLRB. If the labor legislation were simply repealed, in toto, petitioners would have no basis whatsoever for claiming that an employer had any duty to continue making contributions to a fund after the expiration of its contractual commitment to do so. The duty that does exist is simply a consequence of a broader labor law duty that was created to protect the collective-bargaining process. Unilateral changes in the terms and conditions of employment are prohibited, not to vindicate the interests that motivated the enactment of 515 in 1980, but rather to carry out the purposes of the NLRA. The net effect of the labor law duties imposed on employers by that legislation provides a substantial benefit to ERISA plan trustees, but Congress has not provided them with a unique and preferred procedure for obtaining redress for an employer's violation of its duty to bargain with the union. The judgment of the Court of Appeals is Affirmed. JUSTICE KENNEDY took no part in the consideration or decision of this case. |
Justice Burger | majority | false | Aetna Life Ins. Co. v. Lavoie | 1986-04-22T00:00:00 | null | https://www.courtlistener.com/opinion/111632/aetna-life-ins-co-v-lavoie/ | https://www.courtlistener.com/api/rest/v3/clusters/111632/ | 1,986 | 1985-069 | 2 | 8 | 0 | The question presented is whether the Due Process Clause of the Fourteenth Amendment was violated when a justice of the Alabama Supreme Court declined to recuse himself from participation in that court's consideration of this case.
I
This appeal arises out of litigation concerning an insurance policy issued by appellant covering appellees Margaret and Roger Lavoie. In January 1977, Mrs. Lavoie was examined by her physician, Dr. Douglas' because of various ailments. Shortly thereafter, on Dr. Douglas' recommendation, she was admitted to the Mobile Infirmary Hospital, where she remained for 23 days for a battery of tests.
After her discharge, the hospital forwarded the appropriate forms and medical records along with a bill for $3,028.25 to appellant's local office in Mobile, Alabama. The local office refused to pay the entire amount, tendering payment for only $1,650.22. The local office also sent a letter to the national office, concluding that the 23-day hospitalization was unnecessary and that "[h]ospital records do not indicate anything to the contrary," even though all the hospital records had not yet been received. At one point, the national office told the local office to continue denying the request for full payment, but added that "if they act like they are going to file suit," the file should be reviewed.
*816 Appellees filed suit against appellant, seeking both payment of the remainder of their original claim and punitive damages for the tort of bad-faith refusal to pay a valid claim. The trial court dismissed for failure to state a cause of action with respect to the bad-faith counts. Appellees appealed to the Alabama Supreme Court, which remanded on the ground that it had "not foreclosed the possibility of recovery in tort for the bad faith refusal of an insurer to pay legitimate benefits due under an insurance policy." Lavoie v. Aetna Life & Casualty Co., 374 So. 2d 310, 312 (1979). On remand, the trial court entered judgment for appellees on the unpaid portion of their claim and granted summary judgment for appellant on the bad-faith claim. The Alabama Supreme Court again reversed, explaining that on that same day it had "recognized the intentional tort of bad faith in first party insurance actions." Lavoie v. Aetna Life & Casualty Co., 405 So. 2d 17, 18 (1981) (citing Chavers v. National Security Fire & Casualty Co., 405 So. 2d 1 (1981)). On remand, appellees' bad-faith claim was submitted to a jury. The jury awarded $3.5 million in punitive damages. The trial judge denied appellant's motion for judgment n.o.v. or, alternatively, for remittitur.
The Alabama Supreme Court affirmed the award in a 5-to-4 decision. 470 So. 2d 1060 (1984). An unsigned per curiam opinion expressed the view of five justices that the evidence demonstrated that appellant had acted in bad faith. The court interpreted its prior opinions as not requiring dismissal of a bad-faith-refusal-to-pay claim even where a directed verdict against the insurer on the underlying claim was impossible. The opinion also clarified the issue of whether a bad-faith suit could be maintained where the insurer had made a partial payment of the underlying claim. Although earlier opinions of the court had refused to allow bad-faith suits in such circumstances, partial payment was not dispositive of *817 the bad-faith issue. The court also rejected appellant's argument that the punitive damages award was so excessive that it must be set aside.
Chief Justice Torbert, joined by Justice Beatty, dissented; Justice Maddox, joined by Justice Shores, also dissented, concluding that the case was controlled by the court's earlier decision in National Savings Life Ins. Co. v. Dutton, 419 So. 2d 1357 (1982), because there was an arguable reason for appellant's refusal to pay the claim.
The Court's opinion was released on December 7, 1984; on December 21, 1984, appellant filed a timely application for rehearing. On February 14, 1985, before its application had been acted on, appellant learned that while the instant action was pending before the Alabama Supreme Court, Justice Embry, one of the five justices joining the per curiam opinion, had filed two actions in the Circuit Court for Jefferson County, Alabama, against insurance companies. Both of these actions alleged bad-faith failure to pay a claim. One suit arose out of Maryland Casualty Company's alleged failure to pay for the loss of a valuable mink coat; the other suit, which Justice Embry brought on behalf of himself and as a representative of a class of all other Alabama state employees insured under a group plan by Blue Cross-Blue Shield of Alabama (including, apparently, all justices of the Alabama Supreme Court), alleged a willful and intentional plan to withhold payment on valid claims. Both suits sought punitive damages.
On February 21, 1985, appellant filed two motions in the Alabama Supreme Court, challenging Justice Embry's participation in the court's December 7, 1984, decision and his continued participation in considering appellant's application for rehearing. The motion also alleged that all justices on the court should recuse themselves because of their interests as potential class members in Justice Embry's suit against Blue Cross. On March 8, 1985, the court unanimously denied *818 the recusal motions. The brief order stated that each justice had voted individually on the matter of whether he should recuse himself and that each justice had voted not to do so. At the same time, by a 5-to-4 division, the court denied appellant's motion for rehearing.
Chief Justice Torbert wrote separately, explaining that although his views had not been influenced by his possible membership in the putative class alleged in Justice Embry's suit against Blue Cross, he was nonetheless notifying the Clerk of the court where that suit was pending not to permit him to be included in the alleged class. Justice Maddox also wrote separately, taking similar action.
On March 20, 1985, appellant obtained a copy of the transcript of Justice Embry's deposition, taken on January 10, 1985, in connection with his Blue Cross suit. The deposition revealed that Justice Embry had authored the per curiam opinion in this case over an 8- or 9-month period during which his civil action against Blue Cross was being prosecuted. Justice Embry also stated that, during that period, he had received "leads" from people with regard to his bad-faith action against Blue Cross and that he put them in touch with his attorney. Finally, Justice Embry revealed frustration with insurance companies. For example, when asked if he had ever had any difficulty with processing claims, Justice Embry retorted: "[T]hat is a silly question. For years and years."
Appellant moved for leave to file a second application for rehearing based on the deposition, but that motion was denied. Appellant filed an appeal with this Court, and JUSTICE POWELL, as Circuit Justice, granted appellant's application for a stay of the judgment below pending this Court's disposition of the appeal. Shortly thereafter, Justice Embry's suit against Blue Cross was settled by stipulation of the parties.[1] In the stipulation, Blue Cross recognized that "some problems have occurred in the past and is determined *819 to minimize them in the future." Justice Embry received $30,000 under the settlement agreement on a basic compensatory claim of unspecified amount; a check for that sum was deposited by his attorney directly into Justice Embry's personal account.
We postponed consideration of the question of jurisdiction pending argument on the merits. 471 U.S. 1134 (1985). We now vacate and remand.
II
We are satisfied as to the Court's jurisdiction over the question of whether Justice Embry's participation violated appellant's Fourteenth Amendment due process rights. Appellees argue that the Alabama Supreme Court did not reach this issue because it was raised only after the court's decision on the merits. We reject that contention as at odds with the record. On March 8, 1985, the court entered the following order:
"Upon consideration, the Court is of the opinion that under the allegation of said motion in this case each justice should vote individually on the matter of whether or not he or she is disqualified and should recuse. Each justice having voted not to recuse,
"IT IS, THEREFORE, ORDERED that the `Motion for Disqualification and Motion for Withdrawal of Opinion of December 7, 1984, and for Hearing De Novo' be. . . denied." App. to Juris. Statement 64a.
This order clearly demonstrates that the Alabama court reached the merits of appellant's constitutional challenge, albeit on a justice-by-justice basis. Moreover, appellant raised this issue as soon as it discovered the facts relating to Justice Embry's personal lawsuits. On this record, we conclude jurisdiction is proper. See Ulster County Court v. *820 Allen, 442 U.S. 140, 147-154 (1979); Ward v. Village of Monroeville, 409 U.S. 57, 61 (1972).
III
A
Appellant contends Justice Embry's general hostility towards insurance companies that were dilatory in paying claims, as expressed in his deposition, requires a conclusion that the Due Process Clause was violated by his participation in the disposition of this case. The Court has recognized that not "[a]ll questions of judicial qualification . . . involve constitutional validity. Thus matters of kinship, personal bias, state policy, remoteness of interest, would seem generally to be matters merely of legislative discretion." Tumey v. Ohio, 273 U.S. 510, 523 (1927); see also FTC v. Cement Institute, 333 U.S. 683, 702 (1948) ("[M]ost matters relating to judicial disqualification [do] not rise to a constitutional level"). Moreover, the traditional common-law rule was that disqualification for bias or prejudice was not permitted. See, e. g., Clyma v. Kennedy, 64 Conn. 310, 29 A. 539 (1894). See generally Frank, Disqualification of Judges, 56 Yale L. J. 605 (1947). As Blackstone put it, "the law will not suppose a possibility of bias or favour in a judge, who is already sworn to administer impartial justice, and whose authority greatly depends upon that presumption and idea." 3 W. Blackstone, Commentaries *361. The more recent trend has been towards the adoption of statutes that permit disqualification for bias or prejudice. See Berger v. United States, 255 U.S. 22, 31 (1921) (enforcing statute disqualifying federal judges in certain circumstances for personal bias or prejudice). See also ABA Code of Judicial Conduct, Canon 3C(1)(a) (1980) ("A judge should disqualify himself . . . where he has a personal bias or prejudice concerning a party"). But that alone would not be sufficient basis for imposing a constitutional requirement under the Due Process Clause. *821 We held in Patterson v. New York, 432 U.S. 197, 201-202 (1977) (citations omitted), that
"it is normally within the power of the State to regulate procedures under which its laws are carried out . . . and its decision in this regard is not subject to proscription under the Due Process Clause unless it offends some principle of justice so rooted in the traditions and conscience of our people as to be ranked as fundamental."
We need not decide whether allegations of bias or prejudice by a judge of the type we have here would ever be sufficient under the Due Process Clause to force recusal. Certainly only in the most extreme of cases would disqualification on this basis be constitutionally required, and appellant's arguments here fall well below that level. Appellant suggests that Justice Embry's general frustration with insurance companies reveals a disqualifying bias, but it is likely that many claimants have developed hostile feelings from the frustration in awaiting settlement of insurance claims. Insurers, on their side, have no easy task, especially when trying to evaluate whether certain medical diagnostic tests or prolonged hospitalization were indicated. In turn, the physicians and surgeons, whether impelled by valid medical judgment or by apprehension as to future malpractice claims or some combination of the two similarly face difficult problems. Appellant's allegations of bias and prejudice on this general basis, however, are insufficient to establish any constitutional violation.
B
The record in this case presents more than mere allegations of bias and prejudice, however. Appellant also presses a claim that Justice Embry had a more direct stake in the outcome of this case. In Tumey, while recognizing that the Constitution does not reach every issue of judicial qualification, the Court concluded that "it certainly violates the Fourteenth Amendment . . . to subject [a person's] liberty or *822 property to the judgment of a court the judge of which has a direct, personal, substantial, pecuniary interest in reaching a conclusion against him in his case." 273 U.S., at 523.
More than 30 years ago Justice Black, speaking for the Court, reached a similar conclusion and recognized that under the Due Process Clause no judge "can be a judge in his own case [or be] permitted to try cases where he has an interest in the outcome." In re Murchison, 349 U.S. 133, 136 (1955). He went on to acknowledge that what degree or kind of interest is sufficient to disqualify a judge from sitting "cannot be defined with precision." Ibid. Nonetheless, a reasonable formulation of the issue is whether the
"situation is one `which would offer a possible temptation to the average . . . judge to . . . lead him not to hold the balance nice, clear and true.' " Ward v. Village of Monroeville, supra, at 60.
Under these prior holdings, we examine just what factors might constitute such an interest in the outcome of this case that would bear on recusal. At the time Justice Embry cast the deciding vote and authored the court's opinion, he had pending at least one very similar bad-faith-refusal-to-pay lawsuit against Blue Cross in another Alabama court. The decisions of the court on which Justice Embry sat,[2] the Alabama Supreme Court, are binding on all Alabama courts. We need not blind ourselves to the fact that the law in the area of bad-faith-refusal-to-pay claims in Alabama, as in many other jurisdictions, was unsettled at that time, as the court's close division in deciding this case indicates. When Justice Embry cast the deciding vote, he did not merely apply well-established law and in fact quite possibly made new law; the court's opinion does not suggest that its conclusion was compelled by earlier decisions. Instead, to decide the case the court stated that "it is first necessary to review the policy considerations, elements, and instructive guide *823 posts set out by this court in earlier case law." 470 So. 2d, at 1070. And in another case the court acknowledged that "the tort of bad faith refusal to pay a valid insurance claim is in the embryonic stage, and the Court has not had occasion to address every issue that might arise in these cases." National Savings Life Ins. Co. v. Dutton, 419 So. 2d, at 1362.
The decision under review firmly established that punitive damages could be obtained in Alabama in a situation where the insured's claim is not fully approved and only partial payment of the underlying claim had been made. Prior to the decision under review, the Alabama Supreme Court had not clearly recognized any claim for tortious injury in such circumstances; moreover, it had affirmatively recognized that partial payment was evidence of good faith on the part of the insurer. Sexton v. Liberty National Life Ins. Co., 405 So. 2d 18, 22 (1981). The Alabama court also held that a bad-faith-refusal-to-pay cause of action will lie in Alabama even where the insured is not entitled to a directed verdict on the underlying claim, a conclusion that at the least clarified the thrust of an earlier holding. Cf. National Savings Life Ins. Co. v. Dutton, supra, at 1362. Finally, the court refused to set aside as excessive a punitive damages award of $3.5 million. The largest punitive award previously affirmed by that court was $100,000, a figure remitted from $1.1 million as "obviously the result of passion and prejudice on the part of the jury." Gulf Atlantic Life Ins. Co. v. Barnes, 405 So. 2d 916, 926 (1981).
All of these issues were present in Justice Embry's lawsuit against Blue Cross. His complaint sought recovery for partial payment of claims. Also the very nature of Justice Embry's suit placed in issue whether he would have to establish that he was entitled to a directed verdict on the underlying claims that he alleged Blue Cross refused to pay before gaining punitive damages. Finally, the affirmance of the largest punitive damages award ever (by a substantial margin) on precisely the type of claim raised in the Blue Cross *824 suit undoubtedly "raised the stakes" for Blue Cross in that suit, to the benefit of Justice Embry. Thus, Justice Embry's opinion for the Alabama Supreme Court had the clear and immediate effect of enhancing both the legal status and the settlement value of his own case.
We need not decide whether to characterize the decision under review as a change in Alabama law or a clarification of the contours of that law, a judgment we are obviously not called on to make. We hold simply that when Justice Embry made that judgment, he acted as "a judge in his own case." Murchison, supra, at 136.
We also hold that his interest was " `direct, personal, substantial, [and] pecuniary.' " Ward, supra, at 60 (quoting Tumey v. Ohio, 273 U. S., at 523). Justice Embry's complaint against Blue Cross sought "compensatory damage for breach of contract, inconvenience, emotional and mental distress, disappointment, pain and suffering" in addition to punitive damages for himself and for the class. Soon after the opinion of the Alabama Supreme Court in this case was announced, Blue Cross paid Justice Embry what he characterized in an interview as "a tidy sum," Reply Brief for Appellant 10, n. 8, to settle the suit. Records lodged with this Court show that Justice Embry received $30,000, which was deposited by his attorney directly into Justice Embry's personal account. To be sure, a portion of this money may have gone to Justice Embry's attorney in connection with the case, even though some materials before us suggest that his attorney agreed to waive his fee. Deposition of A. Grey Till in Clay v. Nationwide Insurance Co., CV-78-1148 (Cir. Ct. of Mobile Cty., Ala.), pp. 27-29. We are also aware that Justice Embry obtained a statement in the settlement agreement to the effect that "[t]he primary object of the institution of this suit . . . was to emphasize to defendant Blue Cross. . . that claims under the Plan be processed and determined by Blue Cross in a timely and efficient manner," even though that type of relief was not sought specifically in the complaint *825 while monetary relief was. We nonetheless hold that the "tidy sum" that Justice Embry received directly is sufficient to establish the substantiality of his interest here.
We conclude that Justice Embry's participation in this case violated appellant's due process rights as explicated in Tumey, Murchison, and Ward. We make clear that we are not required to decide whether in fact Justice Embry was influenced, but only whether sitting on the case then before the Supreme Court of Alabama " `would offer a possible temptation to the average . . . judge to . . . lead him not to hold the balance nice, clear and true.' " Ward, 409 U. S., at 60 (quoting Tumey v. Ohio, supra, at 532). The Due Process Clause "may sometimes bar trial by judges who have no actual bias and who would do their very best to weigh the scales of justice equally between contending parties. But to perform its high function in the best way, `justice must satisfy the appearance of justice.' " Murchison, 349 U. S., at 136 (citation omitted).
C
Appellant has challenged not only the participation of Justice Embry in this case but also the participation of all the other justices of the Alabama Supreme Court, or at least the six justices who did not withdraw from Justice Embry's class action against Blue Cross, claiming that they also have an interest in this case. Such allegations do not constitute a sufficient basis for requiring recusal under the Constitution. In the first place, accepting appellant's expansive contentions might require the disqualification of every judge in the State. If so, it is possible that under a "rule of necessity" none of the judges or justices would be disqualified. See United States v. Will, 449 U.S. 200, 214 (1980).
More important, while these justices might conceivably have had a slight pecuniary interest,[3] we find it impossible to *826 characterize that interest as " `direct, personal, substantial, [and] pecuniary.' " Ward, supra, at 60 (quoting Tumey, supra, at 523). Appellant concedes that nothing in the record even suggests that these justices had any knowledge of the class action before the court issued a decision on the merits. Thus, at most only the decision to deny rehearing was even plausibly affected. Any interest that they might have had when they passed on the rehearing motion was clearly highly speculative and contingent. At the time, the trial court had not even certified a class, let alone awarded any class relief of a pecuniary nature. With the proliferation of class actions involving broadly defined classes, the application of the constitutional requirement of disqualification must be carefully limited. Otherwise constitutional disqualification arguments could quickly become a standard feature of class-action litigation. Cf. In re City of Houston, 745 F.2d 925 (CA5 1984). At some point, "[t]he biasing influence . . . [will be] too remote and insubstantial to violate the constitutional constraints." Marshall v. Jerrico, Inc., 446 U.S. 238, 243 (1980). Charges of disqualification should not be *827 made lightly. See Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923). We hold that there is no basis for concluding these justices were disqualified under the Due Process Clause.
D
Having concluded that only Justice Embry was disqualified from participation in this case, we turn to the issue of the proper remedy for this constitutional violation. Our prior decisions have not considered the question whether a decision of a multimember tribunal must be vacated because of the participation of one member who had an interest in the outcome of the case. Rather, our prior cases have involved interpretations of statutes with provisions concerning this question, e. g., Commonwealth Coatings Corp. v. Continental Casualty Co., 393 U.S. 145 (1968), disqualifications of the sole member of a tribunal, e. g., Ward v. Village of Monroeville, supra, and disqualifications of an entire panel, e. g., Gibson v. Berryhill, 411 U.S. 564 (1973). Some courts have concluded that a decision need not be vacated where a disqualified judge's vote is mere surplusage. See, e. g., State ex rel. Langer v. Kositzky, 38 N. D. 616, 166 N.W. 534 (1918); but see, e. g., Oakley v. Aspinwall, 3 N.Y. 547 (1850).[4] But we are aware of no case, and none has been called to our attention, *828 permitting a court's decision to stand when a disqualified judge casts the deciding vote. Here Justice Embry's vote was decisive in the 5-to-4 decision[5] and he was the author of the court's opinion. Because of Justice Embry's leading role in the decision under review, we conclude that the "appearance of justice" will best be served by vacating the decision and remanding for further proceedings. Appellees have not contended that, upon a finding of disqualification, this disposition is improper.
III
We underscore that our decision today undertakes to answer only the question of under what circumstances the Constitution requires disqualification. The Due Process Clause demarks only the outer boundaries of judicial disqualifications. Congress and the states, of course, remain free to impose more rigorous standards for judicial disqualification than those we find mandated here today.
Appellant also argues that the retrospective imposition of punitive damages under a new cause of action violates its rights under the Contracts Clause of Article I, § 10; that a $3.5 million punitive damages award is impermissible under the Excessive Fines Clause of the Eighth Amendment; and that lack of sufficient standards governing punitive damages awards in Alabama violates the Due Process Clause of the Fourteenth Amendment. In addition, appellant contends that Ala. Code § 12-22-72 (1975), under which any person who unsuccessfully appeals a money judgment is assessed a 10% penalty, is unconstitutional under the Equal Protection Clause of the Fourteenth Amendment. These arguments raise important issues which, in an appropriate setting, must *829 be resolved; however, our disposition of the recusal-for-bias issue makes it unnecessary to reach them.
The judgment of the Supreme Court of Alabama is vacated, and the case is remanded for further proceedings not inconsistent with this opinion.
Vacated and remanded.
JUSTICE STEVENS took no part in the consideration or decision of this case. | The question presented is whether the Due Process Clause of the Fourteenth Amendment was violated when a justice of the Alabama Supreme Court declined to recuse himself from participation in that court's consideration of this case. I This appeal arises out of litigation concerning an insurance policy issued by appellant covering appellees Margaret and Roger Lavoie. In January 1977, Mrs. Lavoie was examined by her physician, Dr. Douglas' because of various ailments. Shortly thereafter, on Dr. Douglas' recommendation, she was admitted to the Mobile Infirmary Hospital, where she remained for 23 days for a battery of tests. After her discharge, the hospital forwarded the appropriate forms and medical records along with a bill for $3,028.25 to appellant's local office in Mobile, Alabama. The local office refused to pay the entire amount, tendering payment for only $1,650. The local office also sent a letter to the national office, concluding that the 23-day hospitalization was unnecessary and that "[h]ospital records do not indicate anything to the contrary," even though all the hospital records had not yet been received. At one point, the national office told the local office to continue denying the request for full payment, but added that "if they act like they are going to file suit," the file should be reviewed. *816 Appellees filed suit against appellant, seeking both payment of the remainder of their original claim and punitive damages for the tort of bad-faith refusal to pay a valid claim. The trial court dismissed for failure to state a cause of action with respect to the bad-faith counts. Appellees appealed to the Alabama Supreme Court, which remanded on the ground that it had "not foreclosed the possibility of recovery in tort for the bad faith refusal of an insurer to pay legitimate benefits due under an insurance policy." On remand, the trial court entered judgment for appellees on the unpaid portion of their claim and granted summary judgment for appellant on the bad-faith claim. The Alabama Supreme Court again reversed, explaining that on that same day it had "recognized the intentional tort of bad faith in first party insurance actions." ). On remand, appellees' bad-faith claim was submitted to a jury. The jury awarded $3.5 million in punitive damages. The trial judge denied appellant's motion for judgment n.o.v. or, alternatively, for remittitur. The Alabama Supreme Court affirmed the award in a 5-to-4 decision. An unsigned per curiam opinion expressed the view of five justices that the evidence demonstrated that appellant had acted in bad faith. The court interpreted its prior opinions as not requiring dismissal of a bad-faith-refusal-to-pay claim even where a directed verdict against the insurer on the underlying claim was impossible. The opinion also clarified the issue of whether a bad-faith suit could be maintained where the insurer had made a partial payment of the underlying claim. Although earlier opinions of the court had refused to allow bad-faith suits in such circumstances, partial payment was not dispositive of *817 the bad-faith issue. The court also rejected appellant's argument that the punitive damages award was so excessive that it must be set aside. Chief Justice Torbert, joined by Justice Beatty, dissented; Justice Maddox, joined by Justice Shores, also dissented, concluding that the case was controlled by the court's earlier decision in National Savings Life Ins. because there was an arguable reason for appellant's refusal to pay the claim. The Court's opinion was released on December 7, ; on December 21, appellant filed a timely application for rehearing. On February 14, 1985, before its application had been acted on, appellant learned that while the instant action was pending before the Alabama Supreme Court, Justice Embry, one of the five justices joining the per curiam opinion, had filed two actions in the Circuit Court for Jefferson County, Alabama, against insurance companies. Both of these actions alleged bad-faith failure to pay a claim. One suit arose out of Maryland Casualty Company's alleged failure to pay for the loss of a valuable mink coat; the other suit, which Justice Embry brought on behalf of himself and as a representative of a class of all other Alabama state employees insured under a group plan by Blue Cross-Blue Shield of Alabama (including, apparently, all justices of the Alabama Supreme Court), alleged a willful and intentional plan to withhold payment on valid claims. Both suits sought punitive damages. On February 21, 1985, appellant filed two motions in the Alabama Supreme Court, challenging Justice Embry's participation in the court's December 7, decision and his continued participation in considering appellant's application for rehearing. The motion also alleged that all justices on the court should recuse themselves because of their interests as potential class members in Justice Embry's suit against Blue Cross. On March 8, 1985, the court unanimously denied *8 the recusal motions. The brief order stated that each justice had voted individually on the matter of whether he should recuse himself and that each justice had voted not to do so. At the same time, by a 5-to-4 division, the court denied appellant's motion for rehearing. Chief Justice Torbert wrote separately, explaining that although his views had not been influenced by his possible membership in the putative class alleged in Justice Embry's suit against Blue Cross, he was nonetheless notifying the Clerk of the court where that suit was pending not to permit him to be included in the alleged class. Justice Maddox also wrote separately, taking similar action. On March 20, 1985, appellant obtained a copy of the transcript of Justice Embry's deposition, taken on January 10, 1985, in connection with his Blue Cross suit. The deposition revealed that Justice Embry had authored the per curiam opinion in this case over an 8- or 9-month period during which his civil action against Blue Cross was being prosecuted. Justice Embry also stated that, during that period, he had received "leads" from people with regard to his bad-faith action against Blue Cross and that he put them in touch with his attorney. Finally, Justice Embry revealed frustration with insurance companies. For example, when asked if he had ever had any difficulty with processing claims, Justice Embry retorted: "[T]hat is a silly question. For years and years." Appellant moved for leave to file a second application for rehearing based on the deposition, but that motion was denied. Appellant filed an appeal with this Court, and JUSTICE POWELL, as Circuit Justice, granted appellant's application for a stay of the judgment below pending this Court's disposition of the appeal. Shortly thereafter, Justice Embry's suit against Blue Cross was settled by stipulation of the parties.[1] In the stipulation, Blue Cross recognized that "some problems have occurred in the past and is determined *819 to minimize them in the future." Justice Embry received $30,000 under the settlement agreement on a basic compensatory claim of unspecified amount; a check for that sum was deposited by his attorney directly into Justice Embry's personal account. We postponed consideration of the question of jurisdiction pending argument on the merits. We now vacate and remand. II We are satisfied as to the Court's jurisdiction over the question of whether Justice Embry's participation violated appellant's Fourteenth Amendment due process rights. Appellees argue that the Alabama Supreme Court did not reach this issue because it was raised only after the court's decision on the merits. We reject that contention as at odds with the record. On March 8, 1985, the court entered the following order: "Upon consideration, the Court is of the opinion that under the allegation of said motion in this case each justice should vote individually on the matter of whether or not he or she is disqualified and should recuse. Each justice having voted not to recuse, "IT IS, THEREFORE, ORDERED that the `Motion for Disqualification and Motion for Withdrawal of Opinion of December 7, and for Hearing De Novo' be. denied." App. to Juris. Statement 64a. This order clearly demonstrates that the Alabama court reached the merits of appellant's constitutional challenge, albeit on a justice-by-justice basis. Moreover, appellant raised this issue as soon as it discovered the facts relating to Justice Embry's personal lawsuits. On this record, we conclude jurisdiction is proper. See Ulster County ; III A Appellant contends Justice Embry's general hostility towards insurance companies that were dilatory in paying claims, as expressed in his deposition, requires a conclusion that the Due Process Clause was violated by his participation in the disposition of this case. The Court has recognized that not "[a]ll questions of judicial qualification involve constitutional validity. Thus matters of kinship, personal bias, state policy, remoteness of interest, would seem generally to be matters merely of legislative discretion." ; see also Moreover, the traditional common-law rule was that disqualification for bias or prejudice was not permitted. See, e. g., (94). See generally Frank, Disqualification of Judges, 56 Yale L. J. 605 (1947). As Blackstone put it, "the law will not suppose a possibility of bias or favour in a judge, who is already sworn to administer impartial justice, and whose authority greatly depends upon that presumption and idea." 3 W. Blackstone, Commentaries *3. The more recent trend has been towards the adoption of statutes that permit disqualification for bias or prejudice. See See also ABA Code of Judicial Conduct, Canon 3C(1)(a) ("A judge should disqualify himself where he has a personal bias or prejudice concerning a party"). But that alone would not be sufficient basis for imposing a constitutional requirement under the Due Process Clause. *821 We held in that "it is normally within the power of the State to regulate procedures under which its laws are carried out and its decision in this regard is not subject to proscription under the Due Process Clause unless it offends some principle of justice so rooted in the traditions and conscience of our people as to be ranked as fundamental." We need not decide whether allegations of bias or prejudice by a judge of the type we have here would ever be sufficient under the Due Process Clause to force recusal. Certainly only in the most extreme of cases would disqualification on this basis be constitutionally required, and appellant's arguments here fall well below that level. Appellant suggests that Justice Embry's general frustration with insurance companies reveals a disqualifying bias, but it is likely that many claimants have developed hostile feelings from the frustration in awaiting settlement of insurance claims. Insurers, on their side, have no easy task, especially when trying to evaluate whether certain medical diagnostic tests or prolonged hospitalization were indicated. In turn, the physicians and surgeons, whether impelled by valid medical judgment or by apprehension as to future malpractice claims or some combination of the two similarly face difficult problems. Appellant's allegations of bias and prejudice on this general basis, however, are insufficient to establish any constitutional violation. B The record in this case presents more than mere allegations of bias and prejudice, however. Appellant also presses a claim that Justice Embry had a more direct stake in the outcome of this case. In while recognizing that the Constitution does not reach every issue of judicial qualification, the Court concluded that "it certainly violates the Fourteenth Amendment to subject [a person's] liberty or *8 property to the judgment of a court the judge of which has a direct, personal, substantial, pecuniary interest in reaching a conclusion against him in his case." 273 U.S., at More than 30 years ago Justice Black, speaking for the Court, reached a similar conclusion and recognized that under the Due Process Clause no judge "can be a judge in his own case [or be] permitted to try cases where he has an interest in the outcome." In re Murchison, He went on to acknowledge that what degree or kind of interest is sufficient to disqualify a judge from sitting "cannot be defined with precision." Nonetheless, a reasonable formulation of the issue is whether the "situation is one `which would offer a possible temptation to the average judge to lead him not to hold the balance nice, clear and true.' " Under these prior holdings, we examine just what factors might constitute such an interest in the outcome of this case that would bear on recusal. At the time Justice Embry cast the deciding vote and authored the court's opinion, he had pending at least one very similar bad-faith-refusal-to-pay lawsuit against Blue Cross in another Alabama court. The decisions of the court on which Justice Embry sat,[2] the Alabama Supreme Court, are binding on all Alabama courts. We need not blind ourselves to the fact that the law in the area of bad-faith-refusal-to-pay claims in Alabama, as in many other jurisdictions, was unsettled at that time, as the court's close division in deciding this case indicates. When Justice Embry cast the deciding vote, he did not merely apply well-established law and in fact quite possibly made new law; the court's opinion does not suggest that its conclusion was compelled by earlier decisions. Instead, to decide the case the court stated that "it is first necessary to review the policy considerations, elements, and instructive guide *823 posts set out by this court in earlier case law." And in another case the court acknowledged that "the tort of bad faith refusal to pay a valid insurance claim is in the embryonic stage, and the Court has not had occasion to address every issue that might arise in these cases." National Savings Life Ins. 419 So. 2d, at 2. The decision under review firmly established that punitive damages could be obtained in Alabama in a situation where the insured's claim is not fully approved and only partial payment of the underlying claim had been made. Prior to the decision under review, the Alabama Supreme Court had not clearly recognized any claim for tortious injury in such circumstances; moreover, it had affirmatively recognized that partial payment was evidence of good faith on the part of the insurer. 405 So. 2d The Alabama court also held that a bad-faith-refusal-to-pay cause of action will lie in Alabama even where the insured is not entitled to a directed verdict on the underlying claim, a conclusion that at the least clarified the thrust of an earlier holding. Cf. National Savings Life Ins. at 2. Finally, the court refused to set aside as excessive a punitive damages award of $3.5 million. The largest punitive award previously affirmed by that court was $100,000, a figure remitted from $1.1 million as "obviously the result of passion and prejudice on the part of the jury." Gulf Atlantic Life Ins. All of these issues were present in Justice Embry's lawsuit against Blue Cross. His complaint sought recovery for partial payment of claims. Also the very nature of Justice Embry's suit placed in issue whether he would have to establish that he was entitled to a directed verdict on the underlying claims that he alleged Blue Cross refused to pay before gaining punitive damages. Finally, the affirmance of the largest punitive damages award ever (by a substantial margin) on precisely the type of claim raised in the Blue Cross *824 suit undoubtedly "raised the stakes" for Blue Cross in that suit, to the benefit of Justice Embry. Thus, Justice Embry's opinion for the Alabama Supreme Court had the clear and immediate effect of enhancing both the legal status and the settlement value of his own case. We need not decide whether to characterize the decision under review as a change in Alabama law or a clarification of the contours of that law, a judgment we are obviously not called on to make. We hold simply that when Justice Embry made that judgment, he acted as "a judge in his own case." Murchison, at We also hold that his interest was " `direct, personal, substantial, [and] pecuniary.' " (quoting 273 U. S., at ). Justice Embry's complaint against Blue Cross sought "compensatory damage for breach of contract, inconvenience, emotional and mental distress, disappointment, pain and suffering" in addition to punitive damages for himself and for the class. Soon after the opinion of the Alabama Supreme Court in this case was announced, Blue Cross paid Justice Embry what he characterized in an interview as "a tidy sum," Reply Brief for Appellant 10, n. 8, to settle the suit. Records lodged with this Court show that Justice Embry received $30,000, which was deposited by his attorney directly into Justice Embry's personal account. To be sure, a portion of this money may have gone to Justice Embry's attorney in connection with the case, even though some materials before us suggest that his attorney agreed to waive his fee. Deposition of A. Grey Till in Clay v. Nationwide Insurance Co., CV-78-1148 (Cir. Ct. of Mobile Cty., Ala.), pp. 27-29. We are also aware that Justice Embry obtained a statement in the settlement agreement to the effect that "[t]he primary object of the institution of this suit was to emphasize to defendant Blue Cross. that claims under the Plan be processed and determined by Blue Cross in a timely and efficient manner," even though that type of relief was not sought specifically in the complaint *825 while monetary relief was. We nonetheless hold that the "tidy sum" that Justice Embry received directly is sufficient to establish the substantiality of his interest here. We conclude that Justice Embry's participation in this case violated appellant's due process rights as explicated in Murchison, and We make clear that we are not required to decide whether in fact Justice Embry was influenced, but only whether sitting on the case then before the Supreme Court of Alabama " `would offer a possible temptation to the average judge to lead him not to hold the balance nice, clear and true.' " 409 U. S., (quoting ). The Due Process Clause "may sometimes bar trial by judges who have no actual bias and who would do their very best to weigh the scales of justice equally between contending parties. But to perform its high function in the best way, `justice must satisfy the appearance of justice.' " Murchison, 349 U. S., at C Appellant has challenged not only the participation of Justice Embry in this case but also the participation of all the other justices of the Alabama Supreme Court, or at least the six justices who did not withdraw from Justice Embry's class action against Blue Cross, claiming that they also have an interest in this case. Such allegations do not constitute a sufficient basis for requiring recusal under the Constitution. In the first place, accepting appellant's expansive contentions might require the disqualification of every judge in the State. If so, it is possible that under a "rule of necessity" none of the judges or justices would be disqualified. See United More important, while these justices might conceivably have had a slight pecuniary interest,[3] we find it impossible to *826 characterize that interest as " `direct, personal, substantial, [and] pecuniary.' " (quoting at ). Appellant concedes that nothing in the record even suggests that these justices had any knowledge of the class action before the court issued a decision on the merits. Thus, at most only the decision to deny rehearing was even plausibly affected. Any interest that they might have had when they passed on the rehearing motion was clearly highly speculative and contingent. At the time, the trial court had not even certified a class, let alone awarded any class relief of a pecuniary nature. With the proliferation of class actions involving broadly defined classes, the application of the constitutional requirement of disqualification must be carefully limited. Otherwise constitutional disqualification arguments could quickly become a standard feature of class-action litigation. Cf. In re City of Houston, At some point, "[t]he biasing influence [will be] too remote and insubstantial to violate the constitutional constraints." Charges of disqualification should not be *827 made lightly. See We hold that there is no basis for concluding these justices were disqualified under the Due Process Clause. D Having concluded that only Justice Embry was disqualified from participation in this case, we turn to the issue of the proper remedy for this constitutional violation. Our prior decisions have not considered the question whether a decision of a multimember tribunal must be vacated because of the participation of one member who had an interest in the outcome of the case. Rather, our prior cases have involved interpretations of statutes with provisions concerning this question, e. g., Commonwealth Coatings disqualifications of the sole member of a tribunal, e. g., and disqualifications of an entire panel, e. g., Some courts have concluded that a decision need not be vacated where a disqualified judge's vote is mere surplusage. See, e. g., State ex rel. 38 N. D. 6, (19); but see, e. g., (50).[4] But we are aware of no case, and none has been called to our attention, *828 permitting a court's decision to stand when a disqualified judge casts the deciding vote. Here Justice Embry's vote was decisive in the 5-to-4 decision[5] and he was the author of the court's opinion. Because of Justice Embry's leading role in the decision under review, we conclude that the "appearance of justice" will best be served by vacating the decision and remanding for further proceedings. Appellees have not contended that, upon a finding of disqualification, this disposition is improper. III We underscore that our decision today undertakes to answer only the question of under what circumstances the Constitution requires disqualification. The Due Process Clause demarks only the outer boundaries of judicial disqualifications. Congress and the states, of course, remain free to impose more rigorous standards for judicial disqualification than those we find mandated here today. Appellant also argues that the retrospective imposition of punitive damages under a new cause of action violates its rights under the Contracts Clause of Article I, 10; that a $3.5 million punitive damages award is impermissible under the Excessive Fines Clause of the Eighth Amendment; and that lack of sufficient standards governing punitive damages awards in Alabama violates the Due Process Clause of the Fourteenth Amendment. In addition, appellant contends that Ala. Code 12--72 (1975), under which any person who unsuccessfully appeals a money judgment is assessed a 10% penalty, is unconstitutional under the Equal Protection Clause of the Fourteenth Amendment. These arguments raise important issues which, in an appropriate setting, must *829 be resolved; however, our disposition of the recusal-for-bias issue makes it unnecessary to reach them. The judgment of the Supreme Court of Alabama is vacated, and the case is remanded for further proceedings not inconsistent with this opinion. Vacated and remanded. JUSTICE STEVENS took no part in the consideration or decision of this case. |
Justice Kagan | dissenting | false | Yates v. United States | 2015-02-25T00:00:00 | null | https://www.courtlistener.com/opinion/2781925/yates-v-united-states/ | https://www.courtlistener.com/api/rest/v3/clusters/2781925/ | 2,015 | 2014-015 | 2 | 5 | 4 | A criminal law, 18 U.S. C. §1519, prohibits tampering
with “any record, document, or tangible object” in an
attempt to obstruct a federal investigation. This case
raises the question whether the term “tangible object”
means the same thing in §1519 as it means in everyday
language—any object capable of being touched. The an-
swer should be easy: Yes. The term “tangible object” is
broad, but clear. Throughout the U. S. Code and many
States’ laws, it invariably covers physical objects of all
kinds. And in §1519, context confirms what bare text
says: All the words surrounding “tangible object” show
that Congress meant the term to have a wide range. That
fits with Congress’s evident purpose in enacting §1519: to
punish those who alter or destroy physical evidence—any
physical evidence—with the intent of thwarting federal
law enforcement.
The plurality instead interprets “tangible object” to
cover “only objects one can use to record or preserve in-
formation.” Ante, at 7. The concurring opinion similarly,
if more vaguely, contends that “tangible object” should
refer to “something similar to records or documents”—and
shouldn’t include colonial farmhouses, crocodiles, or fish.
Ante, at 1 (ALITO, J., concurring in judgment). In my view,
conventional tools of statutory construction all lead to a
2 YATES v. UNITED STATES
KAGAN, J., dissenting
more conventional result: A “tangible object” is an object
that’s tangible. I would apply the statute that Congress
enacted and affirm the judgment below.
I
While the plurality starts its analysis with §1519’s
heading, see ante, at 10 (“We note first §1519’s caption”), I
would begin with §1519’s text. When Congress has not
supplied a definition, we generally give a statutory term
its ordinary meaning. See, e.g., Schindler Elevator Corp.
v. United States ex rel. Kirk, 563 U. S. ___, ___ (2011) (slip
op., at 5). As the plurality must acknowledge, the ordi-
nary meaning of “tangible object” is “a discrete thing that
possesses physical form.” Ante, at 7 (punctuation and
citation omitted). A fish is, of course, a discrete thing that
possesses physical form. See generally Dr. Seuss, One
Fish Two Fish Red Fish Blue Fish (1960). So the ordinary
meaning of the term “tangible object” in §1519, as no
one here disputes, covers fish (including too-small red
grouper).
That interpretation accords with endless uses of the
term in statute and rule books as construed by courts.
Dozens of federal laws and rules of procedure (and hun-
dreds of state enactments) include the term “tangible
object” or its first cousin “tangible thing”—some in associ-
ation with documents, others not. See, e.g., 7 U.S. C.
§8302(2) (referring to “any material or tangible object that
could harbor a pest or disease”); 15 U.S. C. §57b–1(c)
(authorizing investigative demands for “documentary
material or tangible things”); 18 U.S. C. §668(a)(1)(D)
(defining “museum” as entity that owns “tangible objects
that are exhibited to the public”); 28 U.S. C. §2507(b)
(allowing discovery of “relevant facts, books, papers, doc-
uments or tangible things”).1 To my knowledge, no court
——————
1 From Alabama and Alaska through Wisconsin and Wyoming (and
Cite as: 574 U. S. ___ (2015) 3
KAGAN, J., dissenting
has ever read any such provision to exclude things that
don’t record or preserve data; rather, all courts have ad-
hered to the statutory language’s ordinary (i.e., expansive)
meaning. For example, courts have understood the
phrases “tangible objects” and “tangible things” in the
Federal Rules of Criminal and Civil Procedure to cover
everything from guns to drugs to machinery to . . . ani-
mals. See, e.g., United States v. Obiukwu, 17 F.3d 816,
819 (CA6 1994) (per curiam) (handgun); United States v.
Acarino, 270 F. Supp. 526, 527–528 (EDNY 1967) (heroin);
In re Newman, 782 F.2d 971, 972–975 (CA Fed. 1986)
(energy generation system); Martin v. Reynolds Metals
Corp., 297 F.2d 49, 56–57 (CA9 1961) (cattle). No sur-
prise, then, that—until today—courts have uniformly
applied the term “tangible object” in §1519 in the same
way. See, e.g., United States v. McRae, 702 F.3d 806,
834–838 (CA5 2012) (corpse); United States v. Maury, 695
F.3d 227, 243–244 (CA3 2012) (cement mixer).
That is not necessarily the end of the matter; I agree
with the plurality (really, who does not?) that context
matters in interpreting statutes. We do not “construe the
meaning of statutory terms in a vacuum.” Tyler v. Cain,
533 U.S. 656, 662 (2001). Rather, we interpret particular
words “in their context and with a view to their place in
the overall statutory scheme.” Davis v. Michigan Dept. of
Treasury, 489 U.S. 803, 809 (1989). And sometimes that
——————
trust me—in all that come between), States similarly use the terms
“tangible objects” and “tangible things” in statutes and rules of all
sorts. See, e.g., Ala. Code §34–17–1(3) (2010) (defining “landscape
architecture” to include the design of certain “tangible objects and
features”); Alaska Rule Civ. Proc. 34(a)(1) (2014) (allowing litigants to
“inspect, copy, test, or sample any tangible things” that constitute or
contain discoverable material); Wis. Stat. §804.09(1) (2014) (requiring
the production of “designated tangible things” in civil proceedings);
Wyo. Rule Crim. Proc. 41(h) (2014) (defining “property” for purposes of
a search-and-seizure statute to include “documents, books, papers and
any other tangible objects”).
4 YATES v. UNITED STATES
KAGAN, J., dissenting
means, as the plurality says, that the dictionary definition
of a disputed term cannot control. See, e.g., Bloate v.
United States, 559 U.S. 196, 205, n. 9 (2010). But this is
not such an occasion, for here the text and its context
point the same way. Stepping back from the words “tan-
gible object” provides only further evidence that Congress
said what it meant and meant what it said.
Begin with the way the surrounding words in §1519
reinforce the breadth of the term at issue. Section 1519
refers to “any” tangible object, thus indicating (in line with
that word’s plain meaning) a tangible object “of whatever
kind.” Webster’s Third New International Dictionary 97
(2002). This Court has time and again recognized that
“any” has “an expansive meaning,” bringing within a
statute’s reach all types of the item (here, “tangible ob-
ject”) to which the law refers. Department of Housing and
Urban Development v. Rucker, 535 U.S. 125, 131 (2002);
see, e.g., Republic of Iraq v. Beaty, 556 U.S. 848, 856
(2009); Ali v. Federal Bureau of Prisons, 552 U.S. 214,
219–220 (2008). And the adjacent laundry list of verbs in
§1519 (“alters, destroys, mutilates, conceals, covers up,
falsifies, or makes a false entry”) further shows that Con-
gress wrote a statute with a wide scope. Those words are
supposed to ensure—just as “tangible object” is meant to—
that §1519 covers the whole world of evidence-tampering,
in all its prodigious variety. See United States v. Rodgers,
466 U.S. 475, 480 (1984) (rejecting a “narrow, technical
definition” of a statutory term when it “clashes strongly”
with “sweeping” language in the same sentence).
Still more, “tangible object” appears as part of a three-
noun phrase (including also “records” and “documents”)
common to evidence-tampering laws and always under-
stood to embrace things of all kinds. The Model Penal
Code’s evidence-tampering section, drafted more than 50
years ago, similarly prohibits a person from “alter[ing],
destroy[ing], conceal[ing] or remov[ing] any record, docu-
Cite as: 574 U. S. ___ (2015) 5
KAGAN, J., dissenting
ment or thing” in an effort to thwart an official investiga-
tion or proceeding. ALI, Model Penal Code §241.7(1),
p. 175 (1962) (emphasis added). The Code’s commentary
emphasizes that the offense described in that provision is
“not limited to conduct that [alters] a written instrument.”
Id., §241.7, Comment 3, at 179. Rather, the language
extends to “any physical object.” Ibid. Consistent with
that statement—and, of course, with ordinary meaning—
courts in the more than 15 States that have laws based on
the Model Code’s tampering provision apply them to all
tangible objects, including drugs, guns, vehicles and . . .
yes, animals. See, e.g., State v. Majors, 318 S.W.3d 850,
859–861 (Tenn. 2010) (cocaine); Puckett v. State, 328 Ark.
355, 357–360, 944 S.W.2d 111, 113–114 (1997) (gun);
State v. Bruno, 236 Conn. 514, 519–520, 673 A.2d 1117,
1122–1123 (1996) (bicycle, skeleton, blood stains); State v.
Crites, 2007 Mont. Dist. LEXIS 615, *5–*7 (Dec. 21, 2007)
(deer antlers). Not a one has limited the phrase’s scope to
objects that record or preserve information.
The words “record, document, or tangible object” in
§1519 also track language in 18 U.S. C. §1512, the federal
witness-tampering law covering (as even the plurality
accepts, see ante, at 12) physical evidence in all its forms.
Section 1512, both in its original version (preceding §1519)
and today, repeatedly uses the phrase “record, document,
or other object”—most notably, in a provision prohibiting
the use of force or threat to induce another person to
withhold any of those materials from an official proceed-
ing. §4(a) of the Victim and Witness Protection Act of
1982, 96 Stat. 1249, as amended, 18 U.S. C. §1512(b)(2).
That language, which itself likely derived from the Model
Penal Code, encompasses no less the bloody knife than the
incriminating letter, as all courts have for decades agreed.
See, e.g., United States v. Kellington, 217 F.3d 1084, 1088
(CA9 2000) (boat); United States v. Applewhaite, 195 F.3d
679, 688 (CA3 1999) (stone wall). And typically “only the
6 YATES v. UNITED STATES
KAGAN, J., dissenting
most compelling evidence” will persuade this Court that
Congress intended “nearly identical language” in provi-
sions dealing with related subjects to bear different mean-
ings. Communication Workers v. Beck, 487 U.S. 735, 754
(1988); see A. Scalia & B. Garner, Reading Law: The
Interpretation of Legal Texts 252 (2012). Context thus
again confirms what text indicates.
And legislative history, for those who care about it, puts
extra icing on a cake already frosted. Section 1519, as the
plurality notes, see ante, at 2, 6, was enacted after the
Enron Corporation’s collapse, as part of the Sarbanes-
Oxley Act of 2002, 116 Stat. 745. But the provision began
its life in a separate bill, and the drafters emphasized that
Enron was “only a case study exposing the shortcomings
in our current laws” relating to both “corporate and crimi-
nal” fraud. S. Rep. No. 107–146, pp. 2, 11 (2002). The
primary “loophole[ ]” Congress identified, see id., at 14,
arose from limits in the part of §1512 just described: That
provision, as uniformly construed, prohibited a person
from inducing another to destroy “record[s], document[s],
or other object[s]”—of every type—but not from doing so
himself. §1512(b)(2); see supra, at 5. Congress (as even
the plurality agrees, see ante, at 6) enacted §1519 to close
that yawning gap. But §1519 could fully achieve that goal
only if it covered all the records, documents, and objects
§1512 did, as well as all the means of tampering with
them. And so §1519 was written to do exactly that—“to
apply broadly to any acts to destroy or fabricate physical
evidence,” as long as performed with the requisite intent.
S. Rep. No. 107–146, at 14. “When a person destroys
evidence,” the drafters explained, “overly technical legal
distinctions should neither hinder nor prevent prosecu-
tion.” Id., at 7. Ah well: Congress, meet today’s Court,
which here invents just such a distinction with just such
an effect. See United States v. Philadelphia Nat. Bank,
374 U.S. 321, 343 (1963) (“[C]reat[ing] a large loophole in
Cite as: 574 U. S. ___ (2015) 7
KAGAN, J., dissenting
a statute designed to close a loophole” is “illogical and
disrespectful of . . . congressional purpose”).
As Congress recognized in using a broad term, giving
immunity to those who destroy non-documentary evidence
has no sensible basis in penal policy. A person who hides
a murder victim’s body is no less culpable than one who
burns the victim’s diary. A fisherman, like John Yates,
who dumps undersized fish to avoid a fine is no less
blameworthy than one who shreds his vessel’s catch log
for the same reason. Congress thus treated both offenders
in the same way. It understood, in enacting §1519, that
destroying evidence is destroying evidence, whether or not
that evidence takes documentary form.
II
A
The plurality searches far and wide for anything—
anything—to support its interpretation of §1519. But its
fishing expedition comes up empty.
The plurality’s analysis starts with §1519’s title: “De-
struction, alteration, or falsification of records in Federal
investigations and bankruptcy.” See ante, at 10; see also
ante, at 3–4 (opinion of ALITO, J.). That’s already a sign
something is amiss. I know of no other case in which we
have begun our interpretation of a statute with the title,
or relied on a title to override the law’s clear terms. In-
stead, we have followed “the wise rule that the title of a
statute and the heading of a section cannot limit the plain
meaning of the text.” Trainmen v. Baltimore & Ohio
R. Co., 331 U.S. 519, 528–529 (1947).
The reason for that “wise rule” is easy to see: A title is,
almost necessarily, an abridgment. Attempting to men-
tion every term in a statute “would often be ungainly as
well as useless”; accordingly, “matters in the text . . . are
frequently unreflected in the headings.” Id., at 528. Just
last year, this Court observed that two titles in a nearby
8 YATES v. UNITED STATES
KAGAN, J., dissenting
section of Sarbanes-Oxley serve as “but a short-hand
reference to the general subject matter” of the provision at
issue, “not meant to take the place of the detailed provi-
sions of the text.” Lawson v. FMR LLC, 571 U. S. ___, ___
(2014) (slip op., at 16) (quoting Trainmen, 331 U.S., at
528). The “under-inclusiveness” of the headings, we stated,
was “apparent.” Lawson, 571 U. S., at ___ (slip op., at
16). So too for §1519’s title, which refers to “destruction,
alteration, or falsification” but not to mutilation, conceal-
ment, or covering up, and likewise mentions “records” but
not other documents or objects. Presumably, the plurality
would not refuse to apply §1519 when a person only con-
ceals evidence rather than destroying, altering, or falsify-
ing it; instead, the plurality would say that a title is just a
title, which cannot “undo or limit” more specific statutory
text. Ibid. (quoting Trainmen, 331 U. S., at 529). The
same holds true when the evidence in question is not a
“record” but something else whose destruction, alteration,
etc., is intended to obstruct justice.
The plurality next tries to divine meaning from §1519’s
“position within Chapter 73 of Title 18.” Ante, at 10. But
that move is yet odder than the last. As far as I can tell,
this Court has never once suggested that the section num-
ber assigned to a law bears upon its meaning. Cf. Scalia,
supra, at xi–xvi (listing more than 50 interpretive princi-
ples and canons without mentioning the plurality’s new
number-in-the-Code theory). And even on its own terms,
the plurality’s argument is hard to fathom. The plurality
claims that if §1519 applied to objects generally, Congress
would not have placed it “after the pre-existing §1516,
§1517, and §1518” because those are “specialized provi-
sions.” Ante, at 11. But search me if I can find a better
place for a broad ban on evidence-tampering. The plural-
ity seems to agree that the law properly goes in Chapter
73—the criminal code’s chapter on “obstruction of justice.”
But the provision does not logically fit into any of that
Cite as: 574 U. S. ___ (2015) 9
KAGAN, J., dissenting
chapter’s pre-existing sections. And with the first 18
numbers of the chapter already taken (starting with §1501
and continuing through §1518), the law naturally took the
19th place. That is standard operating procedure. Prior
to the Sarbanes-Oxley Act of 2002, all of Chapter 73 was
ordered chronologically: Section 1518 was later enacted
than §1517, which was later enacted than §1516, which
was . . . well, you get the idea. And after Sarbanes-Oxley,
Congress has continued in the same vein. Section 1519 is
thus right where you would expect it (as is the contempo-
raneously passed §1520)—between §1518 (added in 1996)
and §1521 (added in 2008).2
The plurality’s third argument, relying on the surplus-
age canon, at least invokes a known tool of statutory
construction—but it too comes to nothing. Says the plu-
rality: If read naturally, §1519 “would render superfluous”
§1512(c)(1), which Congress passed “as part of the same
act.” Ante, at 13. But that is not so: Although the two
provisions significantly overlap, each applies to conduct
the other does not. The key difference between the two is
that §1519 protects the integrity of “matter[s] within the
jurisdiction of any [federal] department or agency” whereas
§1512(c)(1) safeguards “official proceeding[s]” as defined
in §1515(a)(1)(A). Section 1519’s language often applies
more broadly than §1512(c)(1)’s, as the plurality notes.
——————
2 The lonesome exception to Chapter 73’s chronological order is
§1514A, added in Sarbanes-Oxley to create a civil action to protect
whistleblowers. Congress decided to place that provision right after the
only other section in Chapter 73 to authorize a civil action (that one to
protect victims and witnesses). The plurality, seizing on the §1514
example, says it likewise “would have made more sense for Congress to
codify the substance of §1519 within §1512 or in a new §1512A.” Ante,
at 12, n. 4. But §1512 is titled “Tampering with a witness, victim, or an
informant,” and its provisions almost all protect witnesses from intimi-
dation and harassment. It makes perfect sense that Congress wanted a
broad ban on evidence-spoliation to stand on its own rather than as
part of—or an appendage to—a witness-tampering provision.
10 YATES v. UNITED STATES
KAGAN, J., dissenting
For example, an FBI investigation counts as a matter
within a federal department’s jurisdiction, but falls out-
side the statutory definition of “official proceeding” as
construed by courts. See, e.g., United States v. Gabriel,
125 F.3d 89, 105, n. 13 (CA2 1997). But conversely,
§1512(c)(1) sometimes reaches more widely than §1519.
For example, because an “official proceeding” includes any
“proceeding before a judge or court of the United States,”
§1512(c)(1) prohibits tampering with evidence in federal
litigation between private parties. See §1515(a)(1)(A);
United States v. Burge, 711 F.3d 803, 808–810 (CA7
2013); United States v. Reich, 479 F.3d 179, 185–187 (CA2
2007) (Sotomayor, J.). By contrast, §1519 wouldn’t ordi-
narily operate in that context because a federal court isn’t
a “department or agency.” See Hubbard v. United States,
514 U.S. 695, 715 (1995).3 So the surplusage canon
doesn’t come into play.4 Overlap—even significant over-
lap—abounds in the criminal law. See Loughrin v. United
——————
3 The plurality’s objection to this statement is difficult to understand.
It cannot take issue with Hubbard’s holding that “a federal court is
neither a ‘department’ nor an ‘agency’ ” in a statute referring, just as
§1519 does, to “any matter within the jurisdiction of any department or
agency of the United States.” 514 U.S., at 698, 715. So the plurality
suggests that the phrase “in relation to . . . any such matter” in §1519
somehow changes Hubbard’s result. See ante, at 12–13, and n. 5. But
that phrase still demands that evidence-tampering relate to a “matter
within the jurisdiction of any department or agency”—excluding courts,
as Hubbard commands. That is why the federal government, as far as
I can tell, has never once brought a prosecution under §1519 for
evidence-tampering in litigation between private parties. It instead uses
§1512(c)(1) for that purpose.
4 Section 1512(c)(1) also applies more broadly than §1519 in proceed-
ings relating to insurance regulation. The term “official proceeding” in
§1512(c)(1) is defined to include “proceeding[s] involving the business of
insurance whose activities affect interstate commerce before any
insurance regulatory official or agency.” §1515(a)(1)(D). But §1519
wouldn’t usually apply in that context because state, not federal,
agencies handle most insurance regulation.
Cite as: 574 U. S. ___ (2015) 11
KAGAN, J., dissenting
States, 573 U. S. ___, ___ – ___, n. 4 (2014) (slip op., at 6–7,
n. 4). This Court has never thought that of such ordinary
stuff surplusage is made. See ibid.; Connecticut Nat. Bank
v. Germain, 503 U.S. 249, 253 (1992).
And the legislative history to which the plurality ap-
peals, see ante, at 6, only cuts against it because those
materials show that lawmakers knew that §1519 and
§1512(c)(1) share much common ground. Minority Leader
Lott introduced the amendment that included §1512(c)(1)
(along with other criminal and corporate fraud provisions)
late in the legislative process, explaining that he did so at
the specific request of the President. See 148 Cong. Rec.
12509, 12512 (2002) (remarks of Sen. Lott). Not only Lott
but several other Senators noted the overlap between the
President’s package and provisions already in the bill,
most notably §1519. See id., at 12512 (remarks of Sen.
Lott); id., at 12513 (remarks of Sen. Biden); id., at 12517
(remarks of Sens. Hatch and Gramm). The presence of
both §1519 and §1512(c)(1) in the final Act may have
reflected belt-and-suspenders caution: If §1519 contained
some flaw, §1512(c)(1) would serve as a backstop. Or the
addition of §1512(c)(1) may have derived solely from legis-
lators’ wish “to satisfy audiences other than courts”—that
is, the President and his Justice Department. Gluck &
Bressman, Statutory Interpretation from the Inside, 65
Stan. L. Rev. 901, 935 (2013) (emphasis deleted). Which-
ever the case, Congress’s consciousness of overlap between
the two provisions removes any conceivable reason to cast
aside §1519’s ordinary meaning in service of preventing
some statutory repetition.
Indeed, the inclusion of §1512(c)(1) in Sarbanes-Oxley
creates a far worse problem for the plurality’s construction
of §1519 than for mine. Section 1512(c)(1) criminalizes the
destruction of any “record, document, or other object”;
§1519 of any “record, document, or tangible object.” On
the plurality’s view, one “object” is really an object, where-
12 YATES v. UNITED STATES
KAGAN, J., dissenting
as the other is only an object that preserves or stores
information. But “[t]he normal rule of statutory construc-
tion assumes that identical words used in different parts
of the same act,” passed at the same time, “are intended to
have the same meaning.” Sorenson v. Secretary of Treas-
ury, 475 U.S. 851, 860 (1986) (internal quotation marks
omitted). And that is especially true when the different
provisions pertain to the same subject. See supra, at 5–6.
The plurality doesn’t—really, can’t—explain why it in-
stead interprets the same words used in two provisions of
the same Act addressing the same basic problem to mean
fundamentally different things.
Getting nowhere with surplusage, the plurality switches
canons, hoping that noscitur a sociis and ejusdem generis
will save it. See ante, at 13–16; see also ante, at 1–2 (opin-
ion of ALITO, J.). The first of those related canons advises
that words grouped in a list be given similar meanings.
The second counsels that a general term following specific
words embraces only things of a similar kind. According
to the plurality, those Latin maxims change the English
meaning of “tangible object” to only things, like records
and documents, “used to record or preserve information.”
Ante, at 14.5 But understood as this Court always has, the
canons have no such transformative effect on the worka-
——————
5 The plurality seeks support for this argument in the Sentencing
Commission’s construction of the phrase “records, documents, or
tangible objects,” ante, at 14, but to no avail. The plurality cites a note
in the Commission’s Manual clarifying that this phrase, as used in the
Sentencing Guidelines, “includes” various electronic information,
communications, and storage devices. United States Sentencing
Commission, Guidelines Manual §2J1.2, comment., n. 1 (Nov. 2014)
(USSG). But “includes” (following its ordinary definition) “is not
exhaustive,” as the Commission’s commentary makes explicit. USSG
§1B1.1, comment., n. 2. Otherwise, the Commission’s construction
wouldn’t encompass paper documents. All the note does is to make
plain that “records, documents, or tangible objects” embraces stuff
relating to the digital (as well as the material) world.
Cite as: 574 U. S. ___ (2015) 13
KAGAN, J., dissenting
day language Congress chose.
As an initial matter, this Court uses noscitur a sociis
and ejusdem generis to resolve ambiguity, not create it.
Those principles are “useful rule[s] of construction where
words are of obscure or doubtful meaning.” Russell Motor
Car Co. v. United States, 261 U.S. 514, 520 (1923). But
when words have a clear definition, and all other contex-
tual clues support that meaning, the canons cannot
properly defeat Congress’s decision to draft broad legisla-
tion. See, e.g., Ali, 552 U.S., at 227 (rejecting the invoca-
tion of these canons as an “attempt to create ambiguity
where the statute’s text and structure suggest none”).
Anyway, assigning “tangible object” its ordinary mean-
ing comports with noscitur a sociis and ejusdem generis
when applied, as they should be, with attention to §1519’s
subject and purpose. Those canons require identifying a
common trait that links all the words in a statutory
phrase. See, e.g., Graham County Soil and Water Conser-
vation Dist. v. United States ex rel. Wilson, 559 U.S. 280,
289, n. 7 (2010); Ali, 552 U.S., at 224–226. In responding
to that demand, the plurality characterizes records and
documents as things that preserve information—and so
they are. But just as much, they are things that provide
information, and thus potentially serve as evidence rele-
vant to matters under review. And in a statute pertaining
to obstruction of federal investigations, that evidentiary
function comes to the fore. The destruction of records and
documents prevents law enforcement agents from gather-
ing facts relevant to official inquiries. And so too does the
destruction of tangible objects—of whatever kind. Whether
the item is a fisherman’s ledger or an undersized fish,
throwing it overboard has the identical effect on the ad-
ministration of justice. See supra, at 7. For purposes of
§1519, records, documents, and (all) tangible objects are
therefore alike.
Indeed, even the plurality can’t fully credit its nosci-
14 YATES v. UNITED STATES
KAGAN, J., dissenting
tur/ejusdem argument. The same reasoning would apply
to every law placing the word “object” (or “thing”) after
“record” and “document.” But as noted earlier, such stat-
utes are common: The phrase appears (among other places)
in many state laws based on the Model Penal Code, as
well as in multiple provisions of §1512. See supra, at 4–5.
The plurality accepts that in those laws “object” means
object; its argument about superfluity positively depends
on giving §1512(c)(1) that broader reading. See ante, at
13, 16. What, then, is the difference here? The plurality
proposes that some of those statutes describe less serious
offenses than §1519. See ante, at 17. How and why that
distinction affects application of the noscitur a sociis and
ejusdem generis canons is left obscure: Count it as
one more of the plurality’s never-before-propounded,
not-readily-explained interpretive theories. See supra, at 7,
8–9, 11–12. But in any event, that rationale cannot sup-
port the plurality’s willingness to give “object” its natural
meaning in §1512, which (like §1519) sets out felonies
with penalties of up to 20 years. See §§1512(a)(3)(C), (b),
(c). The canons, in the plurality’s interpretive world,
apparently switch on and off whenever convenient.
And the plurality’s invocation of §1519’s verbs does
nothing to buttress its canon-based argument. See ante,
at 14–15; ante, at 2–3 (opinion of ALITO, J.). The plurality
observes that §1519 prohibits “falsif[ying]” or “mak[ing] a
false entry in” a tangible object, and no one can do those
things to, say, a murder weapon (or a fish). Ante, at 14.
But of course someone can alter, destroy, mutilate, con-
ceal, or cover up such a tangible object, and §1519 prohibits
those actions too. The Court has never before suggested
that all the verbs in a statute need to match up with all
the nouns. See Robers v. United States, 572 U. S. ___, ___
(2014) (slip op., at 4) (“[T]he law does not require legisla-
tors to write extra language specifically exempting, phrase
by phrase, applications in respect to which a portion of a
Cite as: 574 U. S. ___ (2015) 15
KAGAN, J., dissenting
phrase is not needed”). And for good reason. It is exactly
when Congress sets out to draft a statute broadly—to
include every imaginable variation on a theme—that such
mismatches will arise. To respond by narrowing the law,
as the plurality does, is thus to flout both what Congress
wrote and what Congress wanted.
Finally, when all else fails, the plurality invokes the
rule of lenity. See ante, at 18. But even in its most robust
form, that rule only kicks in when, “after all legitimate
tools of interpretation have been exhausted, ‘a reasonable
doubt persists’ regarding whether Congress has made the
defendant’s conduct a federal crime.” Abramski v. United
States, 573 U. S. ___, ___ (2014) (SCALIA, J., dissenting)
(slip op., at 12) (quoting Moskal v. United States, 498 U.S.
103, 108 (1990)). No such doubt lingers here. The plural-
ity points to the breadth of §1519, see ante, at 18, as
though breadth were equivalent to ambiguity. It is not.
Section 1519 is very broad. It is also very clear. Every
traditional tool of statutory interpretation points in the
same direction, toward “object” meaning object. Lenity
offers no proper refuge from that straightforward (even
though capacious) construction.6
——————
6 As part of its lenity argument, the plurality asserts that Yates did
not have “fair warning” that his conduct amounted to a felony. Ante, at
18; see ante, at 17 (stating that “Yates would have had scant reason to
anticipate a felony prosecution” when throwing fish overboard). But
even under the plurality’s view, the dumping of fish is potentially a
federal felony—just under §1512(c)(1), rather than §1519. See ante, at
12–13. In any event, the plurality itself acknowledges that the ordi-
nary meaning of §1519 covers Yates’s conduct, see ante, at 7: That
provision, no less than §1512(c)(1), announces its broad scope in the
clearest possible terms. And when an ordinary citizen seeks notice of a
statute’s scope, he is more likely to focus on the plain text than (as the
plurality would have it) on the section number, the superfluity princi-
ple, and the noscitur and ejusdem canons.
16 YATES v. UNITED STATES
KAGAN, J., dissenting
B
The concurring opinion is a shorter, vaguer version of
the plurality’s. It relies primarily on the noscitur a sociis
and ejusdem generis canons, tries to bolster them with
§1519’s “list of verbs,” and concludes with the section’s
title. See supra, at 7–8, 12–13, 14–15 (addressing each of
those arguments). (Notably, even the concurrence puts no
stock in the plurality’s section-number and superfluity
claims.) From those familiar materials, the concurrence
arrives at the following definition: “ ‘tangible object’ should
mean something similar to records or documents.” Ante,
at 4 (opinion of ALITO, J.). In amplifying that purported
guidance, the concurrence suggests applying the term
“tangible object” in keeping with what “a neighbor, when
asked to identify something similar to record or docu-
ment,” might answer. Ante, at 1. “[W]ho wouldn’t raise an
eyebrow,” the concurrence wonders, if the neighbor said
“crocodile”? Ante, at 1–2. Courts sometimes say, when
explaining the Latin maxims, that the “words of a statute
should be interpreted consistent with their neighbors.”
See, e.g., United States v. Locke, 529 U.S. 89, 105 (2000).
The concurrence takes that expression literally.
But §1519’s meaning should not hinge on the odd game
of Mad Libs the concurrence proposes. No one reading
§1519 needs to fill in a blank after the words “records” and
“documents.” That is because Congress, quite helpfully,
already did so—adding the term “tangible object.” The
issue in this case is what that term means. So if the con-
currence wishes to ask its neighbor a question, I’d recom-
mend a more pertinent one: Do you think a fish (or, if the
concurrence prefers, a crocodile) is a “tangible object”? As
to that query, “who wouldn’t raise an eyebrow” if the
neighbor said “no”?
In insisting on its different question, the concurrence
neglects the proper function of catchall phrases like “or
tangible object.” The reason Congress uses such terms is
Cite as: 574 U. S. ___ (2015) 17
KAGAN, J., dissenting
precisely to reach things that, in the concurrence’s words,
“do[ ] not spring to mind”—to my mind, to my neighbor’s,
or (most important) to Congress’s. Ante, at 1 (opinion of
ALITO, J.). As this Court recently explained: “[T]he whole
value of a generally phrased residual [term] is that it
serves as a catchall for matters not specifically contem-
plated—known unknowns.” Beaty, 556 U.S., at 860.
Congress realizes that in a game of free association with
“record” and “document,” it will never think of all the
other things—including crocodiles and fish—whose de-
struction or alteration can (less frequently but just as
effectively) thwart law enforcement. Cf. United States v.
Stubbs, 11 F.3d 632, 637–638 (CA6 1993) (dead crocodiles
used as evidence to support smuggling conviction). And so
Congress adds the general term “or tangible object”—
again, exactly because such things “do[ ] not spring to
mind.”7
The concurrence suggests that the term “tangible object”
serves not as a catchall for physical evidence but to “en-
sure beyond question” that e-mails and other electronic
files fall within §1519’s compass. Ante, at 2. But that
claim is eyebrow-raising in its own right. Would a Con-
gress wishing to make certain that §1519 applies to
e-mails add the phrase “tangible object” (as opposed, say, to
“electronic communications”)? Would a judge or jury
member predictably find that “tangible object” encom-
passes something as virtual as e-mail (as compared, say,
——————
7 The concurrence contends that when the noscitur and ejusdem can-
ons are in play, “ ‘known unknowns’ should be similar to known
knowns, i.e., here, records and documents.” Ante, at 2. But as noted
above, records and documents are similar to crocodiles and fish as far
as §1519 is concerned: All are potentially useful as evidence in an
investigation. See supra, at 13. The concurrence never explains why
that similarity isn’t the relevant one in a statute aimed at evidence-
tampering.
18 YATES v. UNITED STATES
KAGAN, J., dissenting
with something as real as a fish)? If not (and the answer
is not), then that term cannot function as a failsafe for
e-mails.
The concurrence acknowledges that no one of its argu-
ments can carry the day; rather, it takes the Latin canons
plus §1519’s verbs plus §1519’s title to “tip the case” for
Yates. Ante, at 1. But the sum total of three mistaken
arguments is . . . three mistaken arguments. They do not
get better in the combining. And so the concurrence ends
up right where the plurality does, except that the concur-
rence, eschewing the rule of lenity, has nothing to fall
back on.
III
If none of the traditional tools of statutory interpreta-
tion can produce today’s result, then what accounts for it?
The plurality offers a clue when it emphasizes the dispro-
portionate penalties §1519 imposes if the law is read
broadly. See ante, at 17–18. Section 1519, the plurality
objects, would then “expose[ ] individuals to 20-year prison
sentences for tampering with any physical object that
might have evidentiary value in any federal investigation
into any offense.” Ante, at 18. That brings to the surface
the real issue: overcriminalization and excessive punish-
ment in the U. S. Code.
Now as to this statute, I think the plurality somewhat—
though only somewhat—exaggerates the matter. The
plurality omits from its description of §1519 the require-
ment that a person act “knowingly” and with “the intent to
impede, obstruct, or influence” federal law enforcement.
And in highlighting §1519’s maximum penalty, the plural-
ity glosses over the absence of any prescribed minimum.
(Let’s not forget that Yates’s sentence was not 20 years,
but 30 days.) Congress presumably enacts laws with high
maximums and no minimums when it thinks the prohibited
conduct may run the gamut from major to minor. That
Cite as: 574 U. S. ___ (2015) 19
KAGAN, J., dissenting
is assuredly true of acts obstructing justice. Compare this
case with the following, all of which properly come within,
but now fall outside, §1519: McRae, 702 F.3d, at 834–838
(burning human body to thwart murder investigation);
Maury, 695 F.3d, at 243–244 (altering cement mixer to
impede inquiry into amputation of employee’s fingers);
United States v. Natal, 2014 U. S. Dist. LEXIS 108852,
*24–*26 (D Conn., Aug. 7, 2014) (repainting van to cover
up evidence of fatal arson). Most district judges, as Con-
gress knows, will recognize differences between such cases
and prosecutions like this one, and will try to make the
punishment fit the crime. Still and all, I tend to think, for
the reasons the plurality gives, that §1519 is a bad law—
too broad and undifferentiated, with too-high maximum
penalties, which give prosecutors too much leverage and
sentencers too much discretion. And I’d go further: In
those ways, §1519 is unfortunately not an outlier, but an
emblem of a deeper pathology in the federal criminal code.
But whatever the wisdom or folly of §1519, this Court
does not get to rewrite the law. “Resolution of the pros
and cons of whether a statute should sweep broadly or
narrowly is for Congress.” Rodgers, 466 U.S., at 484. If
judges disagree with Congress’s choice, we are perfectly
entitled to say so—in lectures, in law review articles, and
even in dicta. But we are not entitled to replace the stat-
ute Congress enacted with an alternative of our own
design.
I respectfully dissent | A criminal law, 18 U.S. C. prohibits tampering with “any record, document, or tangible object” in an attempt to obstruct a federal investigation. This case raises the question whether the term “tangible object” means the same thing in as it means in everyday language—any object capable of being touched. The an- swer should be easy: Yes. The term “tangible object” is broad, but clear. Throughout the U. S. Code and many States’ laws, it invariably covers physical objects of all kinds. And in context confirms what bare text says: All the words surrounding “tangible object” show that Congress meant the term to have a wide range. That fits with Congress’s evident purpose in enacting : to punish those who alter or destroy physical evidence—any physical evidence—with the intent of thwarting federal law enforcement. The plurality instead interprets “tangible object” to cover “only objects one can use to record or preserve in- formation.” Ante, The concurring opinion similarly, if more vaguely, contends that “tangible object” should refer to “something similar to records or documents”—and shouldn’t include colonial farmhouses, crocodiles, or fish. Ante, at 1 (ALITO, J., concurring in judgment). In my view, conventional tools of statutory construction all lead to a 2 YATES v. UNITED STATES KAGAN, J., dissenting more conventional result: A “tangible object” is an object that’s tangible. I would apply the statute that Congress enacted and affirm the judgment below. I While the plurality starts its analysis with ’s heading, see ante, at 10 (“We note first ’s caption”), I would begin with ’s text. When Congress has not supplied a definition, we generally give a statutory term its ordinary meaning. See, e.g., Schindler Elevator Corp. v. United States ex rel. Kirk, 563 U. S. (2011) (slip op., ). As the plurality must acknowledge, the ordi- nary meaning of “tangible object” is “a discrete thing that possesses physical form.” Ante, (punctuation and citation omitted). A fish is, of course, a discrete thing that possesses physical form. See generally Dr. Seuss, One Fish Two Fish Red Fish Blue Fish (1960). So the ordinary meaning of the term “tangible object” in as no one here disputes, covers fish (including too-small red grouper). That interpretation accords with endless uses of the term in statute and rule books as construed by courts. Dozens of federal laws and rules of procedure (and hun- dreds of state enactments) include the term “tangible object” or its first cousin “tangible thing”—some in associ- ation with documents, others not. See, e.g., 7 U.S. C. (referring to “any material or tangible object that could harbor a pest or disease”); 15 U.S. C. (authorizing investigative demands for “documentary material or tangible things”); 18 U.S. C. (defining “museum” as entity that owns “tangible objects that are exhibited to the public”); 28 U.S. C. (allowing discovery of “relevant facts, books, papers, doc- uments or tangible things”).1 To my knowledge, no court —————— 1 From Alabama and Alaska through Wisconsin and Wyoming (and Cite as: 574 U. S. (2015) 3 KAGAN, J., dissenting has ever read any such provision to exclude things that don’t record or preserve data; rather, all courts have ad- hered to the statutory language’s ordinary (i.e., expansive) meaning. For example, courts have understood the phrases “tangible objects” and “tangible things” in the Federal Rules of Criminal and Civil Procedure to cover everything from guns to drugs to machinery to ani- mals. See, e.g., United 819 (CA6 1994) (per curiam) (handgun); United States v. Acarino, ; In re Newman, (energy generation system); No sur- prise, then, that—until today—courts have uniformly applied the term “tangible object” in in the same way. See, e.g., United 834–838 (CA5 2012) (corpse); United States v. 695 F.3d 227, 243–244 (CA3 2012) (cement mixer). That is not necessarily the end of the matter; I agree with the plurality (really, who does not?) that context matters in interpreting statutes. We do not “construe the meaning of statutory terms in a vacuum.” Rather, we interpret particular words “in their context and with a view to their place in the overall statutory scheme.” And sometimes that —————— trust me—in all that come between), States similarly use the terms “tangible objects” and “tangible things” in statutes and rules of all sorts. See, e.g., –17–1(3) (defining “landscape architecture” to include the design of certain “tangible objects and features”); Alaska Rule Civ. Proc. 34(a)(1) (2014) (allowing litigants to “inspect, copy, test, or sample any tangible things” that constitute or contain discoverable material); (1) (2014) (requiring the production of “designated tangible things” in civil proceedings); Wyo. Rule Crim. Proc. 41(h) (2014) (defining “property” for purposes of a search-and-seizure statute to include “documents, books, papers and any other tangible objects”). 4 YATES v. UNITED STATES KAGAN, J., dissenting means, as the plurality says, that the dictionary definition of a disputed term cannot control. See, e.g., Bloate v. United States, But this is not such an occasion, for here the text and its context point the same way. Stepping back from the words “tan- gible object” provides only further evidence that Congress said what it meant and meant what it said. Begin with the way the surrounding words in reinforce the breadth of the term at issue. Section 1519 refers to “any” tangible object, thus indicating (in line with that word’s plain meaning) a tangible object “of whatever kind.” Webster’s Third New International Dictionary 97 This Court has time and again recognized that “any” has “an expansive meaning,” bringing within a statute’s reach all types of the item (here, “tangible ob- ject”) to which the law refers. Department of Housing and Urban ; see, e.g., Republic of (2009); 219–220 (2008). And the adjacent laundry list of verbs in (“alters, destroys, mutilates, conceals, covers up, falsifies, or makes a false entry”) further shows that Con- gress wrote a statute with a wide scope. Those words are supposed to ensure—just as “tangible object” is meant to— that covers the whole world of evidence-tampering, in all its prodigious variety. See United (rejecting a “narrow, technical definition” of a statutory term when it “clashes strongly” with “sweeping” language in the same sentence). Still more, “tangible object” appears as part of a three- noun phrase (including also “records” and “documents”) common to evidence-tampering laws and always under- stood to embrace things of all kinds. The Model Penal Code’s evidence-tampering section, drafted more than 50 years ago, similarly prohibits a person from “alter[ing], destroy[ing], conceal[ing] or remov[ing] any record, docu- Cite as: 574 U. S. (2015) 5 KAGAN, J., dissenting ment or thing” in an effort to thwart an official investiga- tion or proceeding. ALI, Model Penal Code p. 175 (1962) (emphasis added). The Code’s commentary emphasizes that the offense described in that provision is “not limited to conduct that [alters] a written instrument.” Comment 3, at 179. Rather, the language extends to “any physical object.” Consistent with that statement—and, of course, with ordinary meaning— courts in the more than 15 States that have laws based on the Model Code’s tampering provision apply them to all tangible objects, including drugs, guns, vehicles and yes, animals. See, e.g., 859–861 (cocaine); ; 519–, 1122–1123 (1996) (bicycle, skeleton, blood stains); State v. Crites, (deer antlers). Not a one has limited the phrase’s scope to objects that record or preserve information. The words “record, document, or tangible object” in also track language in 18 U.S. C. the federal witness-tampering law covering (as even the plurality accepts, see ante, at 12) physical evidence in all its forms. Section 1512, both in its original version (preceding ) and today, repeatedly uses the phrase “record, document, or other object”—most notably, in a provision prohibiting the use of force or threat to induce another person to withhold any of those materials from an official proceed- ing. of the Victim and Witness Protection Act of 1982, as amended, 18 U.S. C. That language, which itself likely derived from the Model Penal Code, encompasses no less the bloody knife than the incriminating letter, as all courts have for decades agreed. See, e.g., United (boat); United States v. Applewhaite, 195 F.3d 679, 688 (CA3 1999) (stone wall). And typically “only the 6 YATES v. UNITED STATES KAGAN, J., dissenting most compelling evidence” will persuade this Court that Congress intended “nearly identical language” in provi- sions dealing with related subjects to bear different mean- ings. Communication (1988); see A. Scalia & B. Garner, Reading Law: The Interpretation of Legal Texts 252 (2012). Context thus again confirms what text indicates. And legislative history, for those who care about it, puts extra icing on a cake already frosted. Section 1519, as the plurality notes, see ante, at 2, 6, was enacted after the Enron Corporation’s collapse, as part of the Sarbanes- Oxley Act of 2002, But the provision began its life in a separate bill, and the drafters emphasized that Enron was “only a case study exposing the shortcomings in our current laws” relating to both “corporate and crimi- nal” fraud. S. Rep. No. 107–146, pp. 2, 11 The primary “loophole[ ]” Congress identified, see arose from limits in the part of just described: That provision, as uniformly construed, prohibited a person from inducing another to destroy “record[s], document[s], or other object[s]”—of every type—but not from doing so himself. (b)(2); see Congress (as even the plurality agrees, see ante, at 6) enacted to close that yawning gap. But could fully achieve that goal only if it covered all the records, documents, and objects did, as well as all the means of tampering with them. And so was written to do exactly that—“to apply broadly to any acts to destroy or fabricate physical evidence,” as long as performed with the requisite intent. S. Rep. No. 107–146, “When a person destroys evidence,” the drafters explained, “overly technical legal distinctions should neither hinder nor prevent prosecu- tion.” Ah well: Congress, meet today’s Court, which here invents just such a distinction with just such an effect. See United (“[C]reat[ing] a large loophole in Cite as: 574 U. S. (2015) 7 KAGAN, J., dissenting a statute designed to close a loophole” is “illogical and disrespectful of congressional purpose”). As Congress recognized in using a broad term, giving immunity to those who destroy non-documentary evidence has no sensible basis in penal policy. A person who hides a murder victim’s body is no less culpable than one who burns the victim’s diary. A fisherman, like John Yates, who dumps undersized fish to avoid a fine is no less blameworthy than one who shreds his vessel’s catch log for the same reason. Congress thus treated both offenders in the same way. It understood, in enacting that destroying evidence is destroying evidence, whether or not that evidence takes documentary form. II A The plurality searches far and wide for anything— anything—to support its interpretation of But its fishing expedition comes up empty. The plurality’s analysis starts with ’s title: “De- struction, alteration, or falsification of records in Federal investigations and bankruptcy.” See ante, at 10; see also ante, at 3–4 (opinion of ALITO, J.). That’s already a sign something is amiss. I know of no other case in which we have begun our interpretation of a statute with the title, or relied on a title to override the law’s clear terms. In- stead, we have followed “the wise rule that the title of a statute and the heading of a section cannot limit the plain meaning of the text.” The reason for that “wise rule” is easy to see: A title is, almost necessarily, an abridgment. Attempting to men- tion every term in a statute “would often be ungainly as well as useless”; accordingly, “matters in the text are frequently unreflected in the headings.” 28. Just last year, this Court observed that two titles in a nearby 8 YATES v. UNITED STATES KAGAN, J., dissenting section of Sarbanes-Oxley serve as “but a short-hand reference to the general subject matter” of the provision at issue, “not meant to take the place of the detailed provi- sions of the text.” Lawson v. FMR LLC, 571 U. S. (2014) (slip op., at 16) (quoting 331 U.S., at 528). The “under-inclusiveness” of the headings, we stated, was “apparent.” Lawson, 571 U. S., at (slip op., at 16). So too for ’s title, which refers to “destruction, alteration, or falsification” but not to mutilation, conceal- ment, or covering up, and likewise mentions “records” but not other documents or objects. Presumably, the plurality would not refuse to apply when a person only con- ceals evidence rather than destroying, altering, or falsify- ing it; instead, the plurality would say that a title is just a title, which cannot “undo or limit” more specific statutory text. (quoting 331 U. S., 29). The same holds true when the evidence in question is not a “record” but something else whose destruction, alteration, etc., is intended to obstruct justice. The plurality next tries to divine meaning from ’s “position within Chapter 73 of Title 18.” Ante, at 10. But that move is yet odder than the last. As far as I can tell, this Court has never once suggested that the section num- ber assigned to a law bears upon its meaning. Cf. Scalia, at xi–xvi (listing more than 50 interpretive princi- ples and canons without mentioning the plurality’s new number-in-the-Code theory). And even on its own terms, the plurality’s argument is hard to fathom. The plurality claims that if applied to objects generally, Congress would not have placed it “after the pre-existing and because those are “specialized provi- sions.” Ante, at 11. But search me if I can find a better place for a broad ban on evidence-tampering. The plural- ity seems to agree that the law properly goes in Chapter 73—the criminal code’s chapter on “obstruction of justice.” But the provision does not logically fit into any of that Cite as: 574 U. S. (2015) 9 KAGAN, J., dissenting chapter’s pre-existing sections. And with the first 18 numbers of the chapter already taken (starting with and continuing through the law naturally took the 19th place. That is standard operating procedure. Prior to the Sarbanes-Oxley Act of 2002, all of Chapter 73 was ordered chronologically: Section 1518 was later enacted than which was later enacted than which was well, you get the idea. And after Sarbanes-Oxley, Congress has continued in the same vein. Section 1519 is thus right where you would expect it (as is the contempo- raneously passed (added in 1996) and (added in 2008).2 The plurality’s third argument, relying on the surplus- age canon, at least invokes a known tool of statutory construction—but it too comes to nothing. Says the plu- rality: If read naturally, “would render superfluous” (c)(1), which Congress passed “as part of the same act.” Ante, But that is not so: Although the two provisions significantly overlap, each applies to conduct the other does not. The key difference between the two is that protects the integrity of “matter[s] within the jurisdiction of any [federal] department or agency” whereas (c)(1) safeguards “official proceeding[s]” as defined in Section 1519’s language often applies more broadly than (c)(1)’s, as the plurality notes. —————— 2 The lonesome exception to Chapter 73’s chronological order is added in Sarbanes-Oxley to create a civil action to protect whistleblowers. Congress decided to place that provision right after the only other section in Chapter 73 to authorize a civil action (that one to protect victims and witnesses). The plurality, seizing on the example, says it likewise “would have made more sense for Congress to codify the substance of within or in a new A.” Ante, at 12, n. 4. But is titled “Tampering with a witness, victim, or an informant,” and its provisions almost all protect witnesses from intimi- dation and harassment. It makes perfect sense that Congress wanted a broad ban on evidence-spoliation to stand on its own rather than as part of—or an appendage to—a witness-tampering provision. 10 YATES v. UNITED STATES KAGAN, J., dissenting For example, an FBI investigation counts as a matter within a federal department’s jurisdiction, but falls out- side the statutory definition of “official proceeding” as construed by courts. See, e.g., United But conversely, (c)(1) sometimes reaches more widely than For example, because an “official proceeding” includes any “proceeding before a judge or court of the United States,” (c)(1) prohibits tampering with evidence in federal litigation between private parties. See United 808–810 (CA7 2013); United 185–187 (Sotomayor, J.). By contrast, wouldn’t ordi- narily operate in that context because a federal court isn’t a “department or agency.” See3 So the surplusage canon doesn’t come into play.4 Overlap—even significant over- lap—abounds in the criminal law. See Loughrin v. United —————— 3 The plurality’s objection to this statement is difficult to understand. It cannot take issue with Hubbard’s holding that “a federal court is neither a ‘department’ nor an ‘agency’ ” in a statute referring, just as does, to “any matter within the jurisdiction of any department or agency of the United States.” So the plurality suggests that the phrase “in relation to any such matter” in somehow changes Hubbard’s result. See ante, at 12–13, and n. 5. But that phrase still demands that evidence-tampering relate to a “matter within the jurisdiction of any department or agency”—excluding courts, as Hubbard commands. That is why the federal government, as far as I can tell, has never once brought a prosecution under for evidence-tampering in litigation between private parties. It instead uses (c)(1) for that purpose. 4 Section 1512(c)(1) also applies more broadly than in proceed- ings relating to insurance regulation. The term “official proceeding” in (c)(1) is defined to include “proceeding[s] involving the business of insurance whose activities affect interstate commerce before any insurance regulatory official or agency.” But wouldn’t usually apply in that context because state, not federal, agencies handle most insurance regulation. Cite as: 574 U. S. (2015) 11 KAGAN, J., dissenting States, 573 U. S. – n. 4 (2014) (slip op., at 6–7, n. 4). This Court has never thought that of such ordinary stuff surplusage is made. See ibid.; Connecticut Nat. Bank v. Germain, And the legislative history to which the plurality ap- peals, see ante, at 6, only cuts against it because those materials show that lawmakers knew that and (c)(1) share much common ground. Minority Leader Lott introduced the amendment that included (c)(1) (along with other criminal and corporate fraud provisions) late in the legislative process, explaining that he did so at the specific request of the President. See 148 Cong. Rec. 12509, 12512 (remarks of Sen. Lott). Not only Lott but several other Senators noted the overlap between the President’s package and provisions already in the bill, most notably See (remarks of Sen. Lott); ; (remarks of Sens. Hatch and Gramm). The presence of both and (c)(1) in the final Act may have reflected belt-and-suspenders caution: If contained some flaw, (c)(1) would serve as a backstop. Or the addition of (c)(1) may have derived solely from legis- lators’ wish “to satisfy audiences other than courts”—that is, the President and his Justice Department. Gluck & Bressman, Statutory Interpretation from the Inside, 65 Stan. L. Rev. 901, 935 (2013) (emphasis deleted). Which- ever the case, Congress’s consciousness of overlap between the two provisions removes any conceivable reason to cast aside ’s ordinary meaning in service of preventing some statutory repetition. Indeed, the inclusion of (c)(1) in Sarbanes-Oxley creates a far worse problem for the plurality’s construction of than for mine. Section 1512(c)(1) criminalizes the destruction of any “record, document, or other object”; of any “record, document, or tangible object.” On the plurality’s view, one “object” is really an object, where- 12 YATES v. UNITED STATES KAGAN, J., dissenting as the other is only an object that preserves or stores information. But “[t]he normal rule of statutory construc- tion assumes that identical words used in different parts of the same act,” passed at the same time, “are intended to have the same meaning.” (internal quotation marks omitted). And that is especially true when the different provisions pertain to the same subject. See –6. The plurality doesn’t—really, can’t—explain why it in- stead interprets the same words used in two provisions of the same Act addressing the same basic problem to mean fundamentally different things. Getting nowhere with surplusage, the plurality switches canons, hoping that noscitur a sociis and ejusdem generis will save it. See ante, –16; see also ante, at 1–2 (opin- ion of ALITO, J.). The first of those related canons advises that words grouped in a list be given similar meanings. The second counsels that a general term following specific words embraces only things of a similar kind. According to the plurality, those Latin maxims change the English meaning of “tangible object” to only things, like records and documents, “used to record or preserve information.” Ante,5 But understood as this Court always has, the canons have no such transformative effect on the worka- —————— 5 The plurality seeks support for this argument in the Sentencing Commission’s construction of the phrase “records, documents, or tangible objects,” ante, but to no avail. The plurality cites a note in the Commission’s Manual clarifying that this phrase, as used in the Sentencing Guidelines, “includes” various electronic information, communications, and storage devices. United States Sentencing Commission, Guidelines Manual comment., n. 1 (Nov. 2014) (USSG). But “includes” (following its ordinary definition) “is not exhaustive,” as the Commission’s commentary makes explicit. USSG comment., n. 2. Otherwise, the Commission’s construction wouldn’t encompass paper documents. All the note does is to make plain that “records, documents, or tangible objects” embraces stuff relating to the digital (as well as the material) world. Cite as: 574 U. S. (2015) 13 KAGAN, J., dissenting day language Congress chose. As an initial matter, this Court uses noscitur a sociis and ejusdem generis to resolve ambiguity, not create it. Those principles are “useful rule[s] of construction where words are of obscure or doubtful meaning.” Russell Motor Car But when words have a clear definition, and all other contex- tual clues support that meaning, the canons cannot properly defeat Congress’s decision to draft broad legisla- tion. See, e.g., (rejecting the invoca- tion of these canons as an “attempt to create ambiguity where the statute’s text and structure suggest none”). Anyway, assigning “tangible object” its ordinary mean- ing comports with noscitur a sociis and ejusdem generis when applied, as they should be, with attention to ’s subject and purpose. Those canons require identifying a common trait that links all the words in a statutory phrase. See, e.g., Graham County Soil and Water Conser- vation 289, n. 7 ; –226. In responding to that demand, the plurality characterizes records and documents as things that preserve information—and so they are. But just as much, they are things that provide information, and thus potentially serve as evidence rele- vant to matters under review. And in a statute pertaining to obstruction of federal investigations, that evidentiary function comes to the fore. The destruction of records and documents prevents law enforcement agents from gather- ing facts relevant to official inquiries. And so too does the destruction of tangible objects—of whatever kind. Whether the item is a fisherman’s ledger or an undersized fish, throwing it overboard has the identical effect on the ad- ministration of justice. See For purposes of records, documents, and (all) tangible objects are therefore alike. Indeed, even the plurality can’t fully credit its nosci- 14 YATES v. UNITED STATES KAGAN, J., dissenting tur/ejusdem argument. The same reasoning would apply to every law placing the word “object” (or “thing”) after “record” and “document.” But as noted earlier, such stat- utes are common: The phrase appears (among other places) in many state laws based on the Model Penal Code, as well as in multiple provisions of See at 4–5. The plurality accepts that in those laws “object” means object; its argument about superfluity positively depends on giving (c)(1) that broader reading. See ante, at 13, 16. What, then, is the difference here? The plurality proposes that some of those statutes describe less serious offenses than See ante, at 17. How and why that distinction affects application of the noscitur a sociis and ejusdem generis canons is left obscure: Count it as one more of the plurality’s never-before-propounded, not-readily-explained interpretive theories. See 8–9, 11–12. But in any event, that rationale cannot sup- port the plurality’s willingness to give “object” its natural meaning in which (like ) sets out felonies with penalties of up to 20 years. See §(a)(3)(C), (b), (c). The canons, in the plurality’s interpretive world, apparently switch on and off whenever convenient. And the plurality’s invocation of ’s verbs does nothing to buttress its canon-based argument. See ante, –15; ante, at 2–3 (opinion of ALITO, J.). The plurality observes that prohibits “falsif[ying]” or “mak[ing] a false entry in” a tangible object, and no one can do those things to, say, a murder weapon (or a fish). Ante, But of course someone can alter, destroy, mutilate, con- ceal, or cover up such a tangible object, and prohibits those actions too. The Court has never before suggested that all the verbs in a statute need to match up with all the nouns. See Robers v. United States, 572 U. S. (2014) (slip op., at 4) (“[T]he law does not require legisla- tors to write extra language specifically exempting, phrase by phrase, applications in respect to which a portion of a Cite as: 574 U. S. (2015) 15 KAGAN, J., dissenting phrase is not needed”). And for good reason. It is exactly when Congress sets out to draft a statute broadly—to include every imaginable variation on a theme—that such mismatches will arise. To respond by narrowing the law, as the plurality does, is thus to flout both what Congress wrote and what Congress wanted. Finally, when all else fails, the plurality invokes the rule of lenity. See ante, at 18. But even in its most robust form, that rule only kicks in when, “after all legitimate tools of interpretation have been exhausted, ‘a reasonable doubt persists’ regarding whether Congress has made the defendant’s conduct a federal crime.” Abramski v. United States, 573 U. S. (2014) (SCALIA, J., dissenting) (slip op., at 12) (quoting Moskal v. United States, 498 U.S. 103, 108 (1990)). No such doubt lingers here. The plural- ity points to the breadth of see ante, at 18, as though breadth were equivalent to ambiguity. It is not. Section 1519 is very broad. It is also very clear. Every traditional tool of statutory interpretation points in the same direction, toward “object” meaning object. Lenity offers no proper refuge from that straightforward (even though capacious) construction.6 —————— 6 As part of its lenity argument, the plurality asserts that Yates did not have “fair warning” that his conduct amounted to a felony. Ante, at 18; see ante, at 17 (stating that “Yates would have had scant reason to anticipate a felony prosecution” when throwing fish overboard). But even under the plurality’s view, the dumping of fish is potentially a federal felony—just under (c)(1), rather than See ante, at 12–13. In any event, the plurality itself acknowledges that the ordi- nary meaning of covers Yates’s conduct, see ante, : That provision, no less than (c)(1), announces its broad scope in the clearest possible terms. And when an ordinary citizen seeks notice of a statute’s scope, he is more likely to focus on the plain text than (as the plurality would have it) on the section number, the superfluity princi- ple, and the noscitur and ejusdem canons. 16 YATES v. UNITED STATES KAGAN, J., dissenting B The concurring opinion is a shorter, vaguer version of the plurality’s. It relies primarily on the noscitur a sociis and ejusdem generis canons, tries to bolster them with ’s “list of verbs,” and concludes with the section’s title. See –8, 12–13, 14–15 (addressing each of those arguments). (Notably, even the concurrence puts no stock in the plurality’s section-number and superfluity claims.) From those familiar materials, the concurrence arrives at the following definition: “ ‘tangible object’ should mean something similar to records or documents.” Ante, at 4 (opinion of ALITO, J.). In amplifying that purported guidance, the concurrence suggests applying the term “tangible object” in keeping with what “a neighbor, when asked to identify something similar to record or docu- ment,” might answer. Ante, at 1. “[W]ho wouldn’t raise an eyebrow,” the concurrence wonders, if the neighbor said “crocodile”? Ante, at 1–2. Courts sometimes say, when explaining the Latin maxims, that the “words of a statute should be interpreted consistent with their neighbors.” See, e.g., United The concurrence takes that expression literally. But ’s meaning should not hinge on the odd game of Mad Libs the concurrence proposes. No one reading needs to fill in a blank after the words “records” and “documents.” That is because Congress, quite helpfully, already did so—adding the term “tangible object.” The issue in this case is what that term means. So if the con- currence wishes to ask its neighbor a question, I’d recom- mend a more pertinent one: Do you think a fish (or, if the concurrence prefers, a crocodile) is a “tangible object”? As to that query, “who wouldn’t raise an eyebrow” if the neighbor said “no”? In insisting on its different question, the concurrence neglects the proper function of catchall phrases like “or tangible object.” The reason Congress uses such terms is Cite as: 574 U. S. (2015) 17 KAGAN, J., dissenting precisely to reach things that, in the concurrence’s words, “do[ ] not spring to mind”—to my mind, to my neighbor’s, or (most important) to Congress’s. Ante, at 1 (opinion of ALITO, J.). As this Court recently explained: “[T]he whole value of a generally phrased residual [term] is that it serves as a catchall for matters not specifically contem- plated—known unknowns.” 556 U.S., at Congress realizes that in a game of free association with “record” and “document,” it will never think of all the other things—including crocodiles and fish—whose de- struction or alteration can (less frequently but just as effectively) thwart law enforcement. Cf. United States v. Stubbs, (dead crocodiles used as evidence to support smuggling conviction). And so Congress adds the general term “or tangible object”— again, exactly because such things “do[ ] not spring to mind.”7 The concurrence suggests that the term “tangible object” serves not as a catchall for physical evidence but to “en- sure beyond question” that e-mails and other electronic files fall within ’s compass. Ante, at 2. But that claim is eyebrow-raising in its own right. Would a Con- gress wishing to make certain that applies to e-mails add the phrase “tangible object” (as opposed, say, to “electronic communications”)? Would a judge or jury member predictably find that “tangible object” encom- passes something as virtual as e-mail (as compared, say, —————— 7 The concurrence contends that when the noscitur and ejusdem can- ons are in play, “ ‘known unknowns’ should be similar to known knowns, i.e., here, records and documents.” Ante, at 2. But as noted above, records and documents are similar to crocodiles and fish as far as is concerned: All are potentially useful as evidence in an investigation. See The concurrence never explains why that similarity isn’t the relevant one in a statute aimed at evidence- tampering. 18 YATES v. UNITED STATES KAGAN, J., dissenting with something as real as a fish)? If not (and the answer is not), then that term cannot function as a failsafe for e-mails. The concurrence acknowledges that no one of its argu- ments can carry the day; rather, it takes the Latin canons plus ’s verbs plus ’s title to “tip the case” for Yates. Ante, at 1. But the sum total of three mistaken arguments is three mistaken arguments. They do not get better in the combining. And so the concurrence ends up right where the plurality does, except that the concur- rence, eschewing the rule of lenity, has nothing to fall back on. III If none of the traditional tools of statutory interpreta- tion can produce today’s result, then what accounts for it? The plurality offers a clue when it emphasizes the dispro- portionate penalties imposes if the law is read broadly. See ante, at 17–18. Section 1519, the plurality objects, would then “expose[ ] individuals to 20-year prison sentences for tampering with any physical object that might have evidentiary value in any federal investigation into any offense.” Ante, at 18. That brings to the surface the real issue: overcriminalization and excessive punish- ment in the U. S. Code. Now as to this statute, I think the plurality somewhat— though only somewhat—exaggerates the matter. The plurality omits from its description of the require- ment that a person act “knowingly” and with “the intent to impede, obstruct, or influence” federal law enforcement. And in highlighting ’s maximum penalty, the plural- ity glosses over the absence of any prescribed minimum. (Let’s not forget that Yates’s sentence was not 20 years, but 30 days.) Congress presumably enacts laws with high maximums and no minimums when it thinks the prohibited conduct may run the gamut from major to minor. That Cite as: 574 U. S. (2015) 19 KAGAN, J., dissenting is assuredly true of acts obstructing justice. Compare this case with the following, all of which properly come within, but now fall outside, : –838 (burning human body to thwart murder investigation); –244 (altering cement mixer to impede inquiry into amputation of employee’s fingers); United States v. Natal, 2014 U. S. Dist. LEXIS 52, *24–*26 (D Conn., Aug. 7, 2014) (repainting van to cover up evidence of fatal arson). Most district judges, as Con- gress knows, will recognize differences between such cases and prosecutions like this one, and will try to make the punishment fit the crime. Still and all, I tend to think, for the reasons the plurality gives, that is a bad law— too broad and undifferentiated, with too-high maximum penalties, which give prosecutors too much leverage and sentencers too much discretion. And I’d go further: In those ways, is unfortunately not an outlier, but an emblem of a deeper pathology in the federal criminal code. But whatever the wisdom or folly of this Court does not get to rewrite the law. “Resolution of the pros and cons of whether a statute should sweep broadly or narrowly is for Congress.” If judges disagree with Congress’s choice, we are perfectly entitled to say so—in lectures, in law review articles, and even in dicta. But we are not entitled to replace the stat- ute Congress enacted with an alternative of our own design. I respectfully dissent |
Justice Rehnquist | majority | false | Garrett v. United States | 1985-08-28T00:00:00 | null | https://www.courtlistener.com/opinion/111440/garrett-v-united-states/ | https://www.courtlistener.com/api/rest/v3/clusters/111440/ | 1,985 | 1984-109 | 1 | 5 | 3 | This case requires us to examine the double jeopardy implications of a prosecution for engaging in a "continuing criminal enterprise" (CCE), in violation of the Comprehensive Drug Abuse Prevention and Control Act of 1970, 21 U.S. C. § 848, when facts underlying a prior conviction are offered to prove one of three predicate offenses that must be shown to make out a CCE violation. Petitioner Jonathan Garrett contends that his prior conviction is a lesser included offense of the CCE charge, and, therefore, that the CCE prosecution is barred under Brown v. Ohio, 432 U.S. 161 (1977).
Between 1976 and 1981, Garrett directed an extensive marihuana importation and distribution operation involving off-loading, transporting, and storing boatloads of marihuana. These activities and related meetings and telephone calls occurred in several States, including Arkansas, Florida, Georgia, Louisiana, Massachusetts, Michigan, Texas, and Washington.
In March 1981, Garrett was charged in three substantive counts of an indictment in the Western District of Washington for his role in the off-loading and landing of approximately 12,000 pounds of marihuana from a "mother ship" at Neah Bay, Washington. He was named as a co-conspirator, but not indicted, in a fourth count charging conspiracy to import marihuana. Having learned that he was being investigated on CCE charges in Florida, Garrett moved to consolidate in the Washington proceedings "all charges anticipated, investigated and currently pending against [him]." The Government opposed the motion on the ground that no other charges had then been filed against Garrett, and the District Court denied it.
Garrett pleaded guilty to one count of importation of marihuana in violation of 21 U.S. C. §§ 952, 960(a)(1), 960(b)(2) and 18 U.S. C. § 2. He was sentenced to five years' imprisonment and a $15,000 fine; and the remaining counts against him, including possession of marihuana with intent to distribute, *776 were dismissed without prejudice to the Government's right to prosecute him on any other offenses he may have committed.
Approximately two months after his guilty plea in Washington, Garrett was indicted in the Northern District of Florida for conspiring to import marihuana, 21 U.S. C. §§ 952, 960, 963, conspiring to possess marihuana with intent to distribute, 21 U.S. C. §§ 841, 846, using a telephone to facilitate illegal drug activities, 21 U.S. C. §§ 963, 846, 843(b), and engaging in a continuing criminal enterprise, 21 U.S. C. § 848. The District Court denied Garrett's pretrial motion to dismiss the CCE charge, made on the ground that it encompassed the Washington importation operation in violation of the Double Jeopardy Clause.
In the Florida trial, the Government introduced extensive evidence of Garrett's ongoing and widespread drug activities, including proof of the marihuana smuggling operation at Neah Bay, Washington. The court instructed the jury on the CCE count that it had to find beyond a reasonable doubt that Garrett had committed "a felony under Title 21 of the United State Code" that "was a part of a continuing series of violations," defined to be "three or more successive violations of Title 21 over a definite period of time with a single or substantially similar purpose." The court further instructed the jury that it had to find that Garrett acted "in concert with five or more other persons," that with respect to them Garrett occupied "a position of organizer, supervisor, or any position of management," and that he "received substantial income from this operation." As to the predicate violations making up the "series," the court instructed the jury that in addition to the offenses charged as substantive counts in the Florida indictment, the felony offenses of possession of marihuana with intent to distribute it, distribution of marihuana, and importation of marihuana would qualify as predicate offenses. 14 Record 16-20. The Washington evidence, as *777 well as other evidence introduced in the Florida trial, tended to prove these latter three offenses.
The jury convicted Garrett on the CCE count, the two conspiracy counts, and the telephone facilitation count. He received consecutive prison terms totaling 14 years and a $45,000 fine on the latter three counts, and 40 years' imprisonment and a $100,000 fine on the CCE count. The CCE prison term was made concurrent with the prison terms on the other counts, but consecutive to the prison term from the Washington conviction. The CCE fine was in addition to the fine on the other counts and the Washington fine.
On appeal, the Court of Appeals for the Eleventh Circuit rejected Garrett's contention that his conviction in Washington for importing marihuana barred the subsequent prosecution in Florida for engaging in a continuing criminal enterprise. 727 F.2d 1003 (1984). The court held that the Washington importation offense and the CCE offense were not the same under the Double Jeopardy Clause; hence successive prosecutions and cumulative sentences for these offenses were permissible. We granted certiorari to consider this question. 469 U.S. 814 (1984).
I
This case presents two of the three aspects of the Double Jeopardy Clause identified in North Carolina v. Pearce, 395 U.S. 711, 717 (1969): protection against a second prosecution for the Washington importation conviction; and protection against multiple punishments for that conviction. Garrett focuses primarily on the former protection, which we address first.
The heart of Garrett's argument entails two steps: First, notwithstanding Jeffers v. United States, 432 U.S. 137 (1977) (plurality opinion), CCE is a separate substantive offense and not a conspiracy offense because it requires completion of the criminal objective and not merely an agreement. *778 Thus CCE is not distinct from its underlying predicates in the way that conspiracy is a distinct offense from the completed object of the conspiracy. Cf. Pinkerton v. United States, 328 U.S. 640, 643 (1946). Second, applying the test of Blockburger v. United States, 284 U.S. 299 (1932), each of the predicate offenses is the "same" for double jeopardy purposes as the CCE offense because the predicate offense does not require proof of any fact not necessary to the CCE offense. Because the latter requires proof of additional facts, including concerted activity with five other persons, a supervisory role, and substantial income, the predicates are lesser included offenses of the CCE provision. The relationship is the same, Garrett argues, as the relationship between the joyriding and auto theft statutes involved in Brown v. Ohio, supra, and thus a subsequent prosecution for the greater CCE offense is barred by the earlier conviction of the lesser marihuana importation offense.
Where the same conduct violates two statutory provisions, the first step in the double jeopardy analysis is to determine whether the legislature in this case Congress intended that each violation be a separate offense. If Congress intended that there be only one offense that is, a defendant could be convicted under either statutory provision for a single act, but not under both there would be no statutory authorization for a subsequent prosecution after conviction of one of the two provisions, and that would end the double jeopardy analysis. Cf. Albrecht v. United States, 273 U.S. 1, 11 (1927).
This question of legislative intent arose in Blockburger in the context of multiple punishments imposed in a single prosecution. Based on one drug sale, Blockburger was convicted of both selling a drug not in the original stamped package and selling it not in pursuance of a written order of the purchaser. The sale violated two separate statutory provisions, and the question was whether "the accused committed two offenses or only one." 284 U.S., at 303-304. The rule stated in Blockburger was applied as a rule of statutory construction to *779 help determine legislative intent. Significantly, after setting out the rule, the Court cited a paragraph in Albrecht, supra, at 11, which included the following statement: "There is nothing in the Constitution which prevents Congress from punishing separately each step leading to the consummation of a transaction which it has power to prohibit and punishing also the completed transaction" (emphasis added). We have recently indicated that the Blockburger rule is not controlling when the legislative intent is clear from the face of the statute or the legislative history. Missouri v. Hunter, 459 U.S. 359, 368 (1983); Albernaz v. United States, 450 U.S. 333, 340 (1981); Whalen v. United States, 445 U.S. 684, 691-692 (1980). Indeed, it would be difficult to contend otherwise without converting what is essentially a factual inquiry as to legislative intent into a conclusive presumption of law.
In the present case the application of the Blockburger rule as a conclusive determinant of legislative intent, rather than as a useful canon of statutory construction, would lead to the conclusion urged by Garrett: that Congress intended the conduct at issue to be punishable either as a predicate offense, or as a CCE offense, but not both. The language, structure, and legislative history of the Comprehensive Drug Abuse, Prevention and Control Act of 1970, however, show in the plainest way that Congress intended the CCE provision to be a separate criminal offense which was punishable in addition to, and not as a substitute for, the predicate offenses. Insofar as the question is one of legislative intent, the Blockburger presumption must of course yield to a plainly expressed contrary view on the part of Congress.
The language of 21 U.S. C. § 848, which is set out in full in the margin,[1] affirmatively states an offense for which punishment will be imposed. It begins:
*780 "Any person who engages in a continuing criminal enterprise shall be sentenced to a term of imprisonment which may not be less than 10 years and which may be *781 up to life imprisonment, to a fine of not more than $100,000, and to the forfeiture prescribed in paragraph (2)." § 848(a)(1).
At this point there is no reference to other statutory offenses, and a separate penalty is set out, rather than a multiplier of the penalty established for some other offense. This same paragraph then incorporates its own recidivist provision, providing for twice the penalty for repeat violators of this section. Significantly the language expressly refers to "one or more prior convictions . . . under this section." Next, subparagraph (2), which sets out various forfeiture provisions, also refers to any person "who is convicted under paragraph (1) of engaging in a continuing criminal enterprise," again suggesting that § 848 is a distinct offense for which one is separately convicted.
Subsection (b) of § 848 defines the conduct that constitutes being "engaged in a continuing criminal enterprise":
"(1) he violates any provision of this subchapter or subchapter II of this chapter [establishing various drug offenses] the punishment for which is a felony, and
"(2) such violation is a part of a continuing series of violations of this subchapter or subchapter II of this chapter
"(A) which are undertaken by such person in concert with five or more other persons with respect to whom such person occupies a position of organizer, a supervisory position, or any other position of management, and
"(B) from which such person obtains substantial income or resources."
A common-sense reading of this definition reveals a carefully crafted prohibition aimed at a special problem. This language is designed to reach the "top brass" in the drug rings, not the lieutenants and foot soldiers.
The definition of a continuing criminal enterprise is not drafted in the way that a recidivist provision would be *782 drafted. Indeed § 848(a)(1), as already noted, contains language that is typical of that sort of provision. Moreover, the very next section of the statute entitled "Dangerous Special Drug Offender Sentencing" is a recidivist provision. It is drafted in starkly contrasting language which plainly is not intended to create a separate offense. For example, it provides for a special hearing before the court sitting without a jury to consider the evidence of prior offenses, and the determination that a defendant is a dangerous special drug offender is made on a preponderance of the information by the court. See 21 U.S. C. § 849.
This conclusion as to Congress' intent is fortified by the legislative history. H. R. 18583 is the bill that was enacted to become the Comprehensive Drug Abuse Prevention and Control Act of 1970. In its section-by-section analysis, the House Committee Report states:
"Section 408(a) [21 U.S. C. § 848(a)] provides that any person who engages in a continuing criminal enterprise shall upon conviction for that offense be sentenced to a term of imprisonment for not less than 10 years and up to life . . . . If the person engages in this activity subsequent to one or more convictions under this section, he shall receive a penalty of not less than 20 years' imprisonment. . . ." H. R. Rep. No. 91-1444, pt. 1, p. 50 (1970) (emphasis added).
The intent to create a separate offense could hardly be clearer.
As originally introduced in the House, H. R. 18583 had a section entitled "Continuing Criminal Enterprises" which in reality was a recidivist provision, like the current 21 U.S. C. § 849, that provided for enhanced sentences for "a special offender," who "committed [a drug] felony as part of a pattern of conduct which was criminal under applicable laws of any jurisdiction, which constituted a substantial source of his income, and in which he manifested special skill or expertise." The House Committee substituted for this provision *783 an amendment offered by Representative Dingell that ultimately became the current § 848. "Instead of providing a post-conviction-presentencing procedure, [the Dingell amendment] made engagement in a continuing criminal enterprise a new and distinct offense with all its elements triable in court." H. R. Rep. No. 91-1444, pt. 1, pp. 83-84 (1970) (additional views); see 116 Cong. Rec. 33302 (1970) (remarks of Rep. Eckhardt).
During consideration of the bill by the full House, Representative Poff offered an amendment which would restore the recidivist provision to the bill in addition to the Dingell provision. Explaining the differences between the two approaches, Representative Eckhardt stated:
"[T]he Dingell amendment created a new offense which would have to be triable in all its parts by admissible evidence brought before the court, whereas the postconviction presentence [procedure] of the original bill similar to the Poff provisions provided that some report upon which sentence would be based would be available to the judge, cross-examination would be available of those who presented the report, but not of those who may have contributed to it." Ibid.
Later in the debate, Representative Poff explained his proposed amendment further:
"Mr. Chairman, the most dangerous criminal in the criminal drug field is the organized crime offender, the habitual offender, the professional criminal.
"Mr. Chairman, we need special penalties in my opinion for these special criminals. Constitutional scholars have suggested two approaches to deal with such offenders. The first is the creation of a separate crime with separate penalties. The second approach is the imposition of longer sentences upon those convicted first of the basic crime and then shown to be dangerous offenders.
"Mr. Chairman, the first approach, the separate crime approach, is the approach taken by section 408 of the *784 Committee bill [21 U.S. C. § 848]. The second is found in the amendment which I have just offered which adds two new sections to the bill, sections 409 and 410 [21 U.S. C. §§ 849 and 850]." Id., at 33630.
The distinction between the two approaches was emphasized in the continuing debate. For example, Representative Eckhardt stated: "Under the Dingell amendment, if you are going to prove a man guilty, you have to come into court and prove every element of the continuing criminal offense." Representative Poff concurred in this characterization of the CCE provision "which embodies a new separate criminal offense with a separate criminal penalty." Representative Poff distinguished this approach from his proposed amendment which "authorizes the judge to impose the extended sentence upon the defendant in the dock who has already been found guilty by the jury of the basic charge." Id., at 33631. The Poff amendment was adopted, id., at 33634, and both approaches are contained in the statute, 21 U.S. C. §§ 848, 849, and 850.
In view of this legislative history, it is indisputable that Congress intended to create a separate CCE offense. One could still argue, however, that having created the separate offense, Congress intended it, where applicable, to be a substitute for the predicate offenses. Nowhere in the legislative history is it stated that a big-time drug operator could be prosecuted and convicted for the separate predicate offenses as well as the CCE offense. The absence of such a statement, however, is not surprising; given the motivation behind the legislation and the temper of the debate, such a statement would merely have stated the obvious. Congress was seeking to add a new enforcement tool to the substantive drug offenses already available to prosecutors. During the debate on the Poff amendment, for example, Representative Fascell stated: "I see no reason to treat a drug trafficker any less harshly than an organized crime racketeer. Their acts are equally heinous, the consequences equally severe, *785 and their punishment equally justified." Representative Weicker stated: "The penalty structure has been designed to accommodate all types of drug offenders, from the casual drug user and experimenter to the organized crime syndicates engaged in unlawful transportation and distribution of illicit drugs." He continued, "This bill goes further in providing those persons charged with enforcing it a wide variety of enforcement tools which will enable them to more effectively combat the illicit drug trafficker and meet the increased demands we have imposed on them." Representative Taft stated: "[T]his amendment will do much at least to help a coordinated attack on the organized crime problem within the purview of this legislation. . . . Hopefully, we will see other legislation coming along broadening the attack on the crime syndicates even further." 116 Cong. Rec. 33630-33631 (1970). It runs counter to common sense to infer from comments such as these, which pervade the entire debate and which stand unrebutted, that Congress intended to substitute the CCE offense for the underlying predicate offenses in the case of a big-time drug dealer rather than to permit prosecution for CCE in addition to prosecution for the predicate offenses.
Finally, it would be illogical for Congress to intend that a choice be made between the predicate offenses and the CCE offense in pursuing major drug dealers. While in the instant case Garrett claims that the Government was aware of the possibility of bringing the CCE charge before he was indicted on the Washington offenses, in many cases the Government would catch a drug dealer for one offense before it was aware of or had the evidence to make a case for other drug offenses he had committed or in the future would commit. The Government would then be forced to choose between prosecuting the dealer on the offense of which it could prove him guilty or releasing him with the idea that he would continue his drug-dealing activities so that the Government might catch him twice more and then be able to prosecute him on the CCE *786 offense. Such a situation is absurd and clearly not what Congress intended.
II
Having determined that Congress intended CCE to be a separate offense and that it intended to permit prosecution for both the predicate offenses and the CCE offense, we must now determine whether prosecution for a CCE offense after an earlier prosecution for a predicate offense is constitutional under the Double Jeopardy Clause of the Fifth Amendment. The Double Jeopardy Clause provides:
"[N]or shall any person be subject for the same offence to be twice put in jeopardy of life or limb."
The critical inquiry is whether a CCE offense is considered the "same offense" as one or more of its predicate offenses within the meaning of the Double Jeopardy Clause.
Quite obviously the CCE offense is not, in any commonsense or literal meaning of the term, the "same" offense as one of the predicate offenses. The CCE offense requires the jury to find that the defendant committed a predicate offense, and in addition that the predicate offense was part of a continuing series of predicate offenses undertaken by the defendant in concert with five or more other persons, that the defendant occupied the position of an organizer or manager, and that the defendant obtained substantial income or resources from the continuing series of violations.
In order to properly analyze the successive prosecution issue, we must examine not only the statute which Congress has enacted, but also the charges which form the basis of the Government's prosecution here. Petitioner pleaded guilty in the Western District of Washington in May 1981 to a count charging importation of 12,000 pounds of marihuana at Neah Bay, Washington, on August 26, 1980. He was indicted in the Northern District of Florida in July 1981, on charges of conspiring to import "multi-ton quantities of marihuana and marihuana `Thai sticks' " from January 1976 to July 16, 1981; *787 of conspiring to possess with intent to distribute marihuana over the same period of time; and of engaging in a continuing criminal enterprise over the same period of time. Thus at the very moment he made his motion to require "consolidation" of all the charges against him in the Western District of Washington, he was engaging in criminal conduct of which he was later found guilty by a jury in the Northern District of Florida.
Petitioner contends that the marihuana importation charge to which he pleaded guilty in Washington was a "lesser included offense" of the CCE offense of which he was convicted in Florida. He points out that evidence of the Washington offense was introduced at the Florida trial, and that the jury was permitted to find that the Washington violation was one of the "predicate offenses" for the CCE charge in Florida. He relies on Brown v. Ohio, 432 U.S. 161 (1977), for his conclusion that the use of the Washington offense as an element of the Florida charge placed him twice in jeopardy in violation of the Fifth Amendment to the United States Constitution.
Brown v. Ohio held that, where the misdemeanor of joyriding was a lesser included offense in the felony of auto theft, a prosecution for the misdemeanor barred a second prosecution for the felony. We think there is a good deal of difference between the classic relation of the "lesser included offense" to the greater offense presented in Brown, on the one hand, and the relationship between the Washington marihuana offense and the CCE charge involved in this case, on the other, The defendant in Brown had stolen an automobile and driven it for several days. He had engaged in a single course of conduct driving a stolen car. The very same conduct would support a misdemeanor prosecution for joyriding or a felony prosecution for auto theft, depending only on the defendant's state of mind while he engaged in the conduct in question. Every moment of his conduct was as relevant to the joyriding charge as it was to the auto theft charge.
*788 In the case before us the situation is quite different. The count in the Washington indictment to which Garrett pleaded guilty charged importation of 12,000 pounds of marihuana at Neah Bay on August 26, 1980. The Washington indictment was returned on March 17, 1981, and a guilty plea entered on May 18, 1981. Two other counts of the indictment, including causing interstate travel to facilitate importation of marihuana on or about October 24, 1979, were dismissed without prejudice to the Government's right subsequently to prosecute any other offense Garrett may have committed.
The CCE indictment returned against Garrett in Florida was returned on July 16, 1981. It charged that he had, from January 1976, "up to and including [July 16, 1981]," conspired in that district and "divers other districts" to import multiton quantities of marihuana and marihuana "Thai sticks" in violation of applicable federal law. Another count charged conspiracy to possess with intent to distribute marihuana over the same period of more than five years. A third count of the Florida indictment charged that Garrett had engaged in the Northern District of Florida and in "divers other districts" in a continuing criminal enterprise over the same 51/2-year period.
Obviously the conduct in which Garrett was charged with engaging in the Florida indictment, when compared with that with which he was charged in the Washington indictment, does not lend itself to the simple analogy of a single course of conduct stealing a car comprising a lesser included misdemeanor within a felony. Here the continuing criminal enterprise was alleged to have spanned more than five years; the acts charged in the Washington indictment were alleged to have occurred on single days in 1979 and 1980, respectively. Whenever it was during the 5 1/2-year period alleged in the indictment that Garrett committed the first of the three predicate offenses required to form the basis for a CCE prosecution, it could not then have been said with any certainty that he would necessarily go ahead and commit the *789 other violations required to render him liable on a CCE charge. Every minute that Nathaniel Brown drove or possessed the stolen automobile he was simultaneously committing both the lesser included misdemeanor and the greater felony, but the same simply is not true of Garrett. His various boatload smuggling operations in Louisiana, for example, obviously involved incidents of conduct wholly separate from his "mother boat" operations in Washington. These significant differences caution against ready transposition of the "lesser included offense" principles of double jeopardy from the classically simple situation presented in Brown to the multilayered conduct, both as to time and to place, involved in this case.
Were we to sustain Garrett's claim, the Government would have been able to proceed against him in either one of only two ways. It would have to have withheld the Washington charges, alleging crimes committed in October 1979 and August 1980, from the grand jury which indicted Garrett in March 1981, until it was prepared to present to a grand jury the CCE charge which was alleged to have been, and found by a jury to be, continuing on each of those dates; or it would have to have submitted the CCE charge to the Washington grand jury in March 1981, even though the indictment ultimately returned against Garrett on that charge alleged that the enterprise had continued until July 1981.[2] We do not *790 think that the Double Jeopardy Clause may be employed to force the Government's hand in this manner, however we were to resolve Garrett's lesser-included-offense argument. One who insists that the music stop and the piper be paid at a particular point must at least have stopped dancing himself before he may seek such an accounting.
Petitioner urges that "[w]here the charges arise from a single criminal act, occurrence, episode, or transaction, they must be tried in a single proceeding. Brown v. Ohio, 432 U. S., at 170 (BRENNAN, J., concurring)." We have steadfastly refused to adopt the "single transaction" view of the Double Jeopardy Clause. But it would seem to strain even that doctrine to describe Garrett's multifarious multistate activities as a "single transaction." For the reasons previously stated, we also have serious doubts as to whether the offense to which Garrett pleaded guilty in Washington was a "lesser included offense" within the CCE charge so that the prosecution of the former would bar a prosecution of the latter. But we may assume, for purposes of decision here, that the Washington offense was a lesser included offense, because in our view Garrett's claim of double jeopardy would still not be sustainable.
*791 In Diaz v. United States, 223 U.S. 442 (1912), the Court had before it an initial prosecution for assault and battery, followed by a prosecution for homicide when the victim eventually died from injuries inflicted in the course of the assault. The Court rejected the defendant's claim of double jeopardy, holding that the two were not the "same offense":
"The homicide charged against the accused in the Court of First Instance and the assault and battery for which he was tried before the justice of the peace, although identical in some of their elements, were distinct offenses both in law and in fact. The death of the injured person was the principal element of the homicide, but was no part of the assault and battery. At the time of the trial for the latter the death had not ensued, and not until it did ensue was the homicide committed. Then, and not before, was it possible to put the accused in jeopardy for that offense." Id., at 448-449.
In the present case, as in Diaz, the continuing criminal enterprise charged against Garrett in Florida had not been completed at the time that he was indicted in Washington. The latter event took place in March 1981, whereas the continuing criminal enterprise charged in the Florida indictment and found by the trial jury extended from January 1976 to July 1981. The evidence at trial showed, for example, that Garrett was arrested for traffic offenses and other violations on July 23, 1981, while out on bail pending sentencing for the Washington conviction. He told the arresting officer that the officer had caught "somebody big" and that he was a "smuggler." At the time of the arrest, Garrett was carrying $6,253 in cash. About $30 of this was in quarters. He explained that he needed them to make long-distance phone calls, on which he sometimes spent $25 to $50 a day. He also told the arresting officer and a federal agent who interviewed him the next morning that he had just bought the truck he *792 had been driving for $13,000 cash and that he used it for smuggling. He further stated that he had a yacht in Hawaii which he had purchased for $160,000 cash. This evidence is consistent with the jury's verdict that Garrett continued his CCE activities into July 1981.
We think this evidence not only permits but requires the conclusion that the CCE charged in Florida, alleged to have begun in January 1976, and continued up to mid-July 1981, was under Diaz a different offense from that charged in the Washington indictment. We cannot tell, without considerable sifting of the evidence and speculating as to what juries might do, whether the Government could in March 1981 have successfully indicted and prosecuted Garrett for a different continuing criminal enterprise one ending in March 1981. But we do not think any such sifting or speculation is required at the behest of one who at the time the first indictment is returned is continuing to engage in other conduct found criminal by the jury which tried the second indictment.
It may well be, as JUSTICE STEVENS suggests in his dissenting opinion, that the Florida indictment did not by its terms indicate that the Neah Bay importation would be used as evidence to support it, post, at 804-805, and therefore at the time the pretrial motion to dismiss on double jeopardy grounds was made the District Court in Florida could not have rendered an informed decision on petitioner's motion. But there can be no doubt that by the time the evidence had all been presented in the Florida trial, and the jury was charged, only one reasonable conclusion could be drawn by the District Court: the Government's evidence with respect to the CCE charge included acts which took place after March 1981, the date of the Washington indictment, and up to and including July 1981. Therefore, the continuing criminal enterprise charged by the Government had not been completed at the time the Washington indictment was returned, and under the Diaz rule evidence of the Neah *793 Bay importation might be used to show one of the predicate offenses.[3]
Having concluded that Congress intended CCE to be a separate offense and that it does not violate the Double Jeopardy Clause under the facts of this case to prosecute the CCE offense after a prior conviction for one of the predicate offenses, the only remaining issue is whether the Double Jeopardy Clause bars cumulative punishments. Garrett's sentence on the CCE conviction was consecutive to his sentence on the Washington conviction. In this connection, "the Double Jeopardy Clause does no more than prevent the sentencing court from prescribing greater punishment than the legislature intended." Missouri v. Hunter, 459 U. S., at 366; Albernaz v. United States, 450 U. S., at 344. As discussed above, Congress intended to create a separate offense. The presumption when Congress creates two distinct offenses is that it intends to permit cumulative sentences, and legislative silence on this specific issue does not establish an ambiguity or rebut this presumption:
"[T]he defendants] read much into nothing. Congress cannot be expected to specifically address each issue of statutory construction which may arise. But, as we have previously noted, Congress is `predominantly a lawyer's body,' . . . and it is appropriate for us `to assume that our elected representatives . . . know the law.' . . . As a result if anything is to be assumed from the congressional silence on this point, it is that Congress was aware of the Blockburger rule and legislated with it in mind. It is not a function of this Court to presume that *794 `Congress was unaware of what it accomplished.' " Id., at 341-342.
Here, of course, Congress was not silent as to its intent to create separate offenses notwithstanding Blockburger, and we can assume it was aware that doing so would authorize cumulative punishments absent some indication of contrary intent.
Moreover, disallowing cumulative sentences would have the anomalous effect in many cases of converting the large fines provided by § 848 into ceilings. Congress established the large fines in § 848 in an effort to deprive big-time drug dealers of some of their enormous profits, which often cannot be traced directly to their crimes for forfeiture purposes. The fines for a three-time offender who has been previously convicted of a drug felony could amount to $150,000 for the predicate offenses standing alone an amount that exceeds the ceiling for a first-time CCE fine. Compare § 841(b)(1)(A) with § 848(a)(1). Congress was bent on depriving the big-time drug dealer of his profits; it is doubtful that Congress intended to force an election of a lower maximum fine in such a situation in order to attempt to obtain the life imprisonment penalty available under the CCE provision.
In Jeffers v. United States, 432 U. S., at 156-157, a plurality of this Court stated that § 848 "reflects a comprehensive penalty structure that leaves little opportunity for pyramiding of penalties from other sections of the Comprehensive Drug Abuse Prevention and Control Act of 1970." The focus of the analysis in Jeffers was the permissibility of cumulative punishments for conspiracy under § 846 and for CCE under § 848, and the plurality reasonably concluded that the dangers posed by a conspiracy and a CCE were similar and thus there would be little purpose in cumulating the penalties. The same is not true of the substantive offenses created by the Act and conspiracy, and by the same logic, it is not true of the substantive offenses and CCE. We have been required in the present case, as we were not in Jeffers, to consider the relationship between substantive predicate offenses and a *795 CCE. We think here logic supports the conclusion, also indicated by the legislative history, that Congress intended separate punishments for the underlying substantive predicates and for the CCE offense. Congress may, of course, so provide if it wishes.
The judgment of the Court of Appeals is affirmed.
It is so ordered.
JUSTICE POWELL took no part in the decision of this case. | This case requires us to examine the double jeopardy implications of a prosecution for engaging in a "continuing criminal enterprise" (CCE), in violation of the Comprehensive Drug Abuse Prevention and Control Act of 1970, 21 U.S. C. 848, when facts underlying a prior conviction are offered to prove one of three predicate offenses that must be shown to make out a CCE violation. Petitioner Jonathan Garrett contends that his prior conviction is a lesser included offense of the CCE charge, and, therefore, that the CCE prosecution is barred under Between 1976 and 1981, Garrett directed an extensive marihuana importation and distribution operation involving off-loading, transporting, and storing boatloads of marihuana. These activities and related meetings and telephone calls occurred in several including Arkansas, Florida, Georgia, Louisiana, Massachusetts, Michigan, Texas, and Washington. In March 1981, Garrett was charged in three substantive counts of an indictment in the Western District of Washington for his role in the off-loading and landing of approximately 12,000 pounds of marihuana from a "mother ship" at Neah Bay, Washington. He was named as a co-conspirator, but not indicted, in a fourth count charging conspiracy to import marihuana. Having learned that he was being investigated on CCE charges in Florida, Garrett moved to consolidate in the Washington proceedings "all charges anticipated, investigated and currently pending against [him]." The Government opposed the motion on the ground that no other charges had then been filed against Garrett, and the District Court denied it. Garrett pleaded guilty to one count of importation of marihuana in violation of 21 U.S. C. 952, 960(a)(1), 960(b)(2) and 18 U.S. C. 2. He was sentenced to five years' imprisonment and a $15,000 fine; and the remaining counts against him, including possession of marihuana with intent to distribute, *776 were dismissed without prejudice to the Government's right to prosecute him on any other offenses he may have committed. Approximately two months after his guilty plea in Washington, Garrett was indicted in the Northern District of Florida for conspiring to import marihuana, 21 U.S. C. 952, 960, 963, conspiring to possess marihuana with intent to distribute, 21 U.S. C. 841, 846, using a telephone to facilitate illegal drug activities, 21 U.S. C. 963, 846, 843(b), and engaging in a continuing criminal enterprise, 21 U.S. C. 848. The District Court denied Garrett's pretrial motion to dismiss the CCE charge, made on the ground that it encompassed the Washington importation operation in violation of the Double Jeopardy Clause. In the Florida trial, the Government introduced extensive evidence of Garrett's ongoing and widespread drug activities, including proof of the marihuana smuggling operation at Neah Bay, Washington. The court instructed the jury on the CCE count that it had to find beyond a reasonable doubt that Garrett had committed "a felony under Title 21 of the United State Code" that "was a part of a continuing series of violations," defined to be "three or more successive violations of Title 21 over a definite period of time with a single or substantially similar purpose." The court further instructed the jury that it had to find that Garrett acted "in concert with five or more other persons," that with respect to them Garrett occupied "a position of organizer, supervisor, or any position of management," and that he "received substantial income from this operation." As to the predicate violations making up the "series," the court instructed the jury that in addition to the offenses charged as substantive counts in the Florida indictment, the felony offenses of possession of marihuana with intent to distribute it, distribution of marihuana, and importation of marihuana would qualify as predicate offenses. 14 Record 16-20. The Washington evidence, as *777 well as other evidence introduced in the Florida trial, tended to prove these latter three offenses. The jury convicted Garrett on the CCE count, the two conspiracy counts, and the telephone facilitation count. He received consecutive prison terms totaling 14 years and a $45,000 fine on the latter three counts, and 40 years' imprisonment and a $100,000 fine on the CCE count. The CCE prison term was made concurrent with the prison terms on the other counts, but consecutive to the prison term from the Washington conviction. The CCE fine was in addition to the fine on the other counts and the Washington fine. On appeal, the Court of Appeals for the Eleventh Circuit rejected Garrett's contention that his conviction in Washington for importing marihuana barred the subsequent prosecution in Florida for engaging in a continuing criminal enterprise. The court held that the Washington importation offense and the CCE offense were not the same under the Double Jeopardy Clause; hence successive prosecutions and cumulative sentences for these offenses were permissible. We granted certiorari to consider this question. I This case presents two of the three aspects of the Double Jeopardy Clause identified in North : protection against a second prosecution for the Washington importation conviction; and protection against multiple punishments for that conviction. Garrett focuses primarily on the former protection, which we address first. The heart of Garrett's argument entails two steps: First, notwithstanding CCE is a separate substantive offense and not a conspiracy offense because it requires completion of the criminal objective and not merely an agreement. *778 Thus CCE is not distinct from its underlying predicates in the way that conspiracy is a distinct offense from the completed object of the conspiracy. Cf. Second, applying the test of each of the predicate offenses is the "same" for double jeopardy purposes as the CCE offense because the predicate offense does not require proof of any fact not necessary to the CCE offense. Because the latter requires proof of additional facts, including concerted activity with five other persons, a supervisory role, and substantial income, the predicates are lesser included offenses of the CCE provision. The relationship is the same, Garrett argues, as the relationship between the joyriding and auto theft statutes involved in and thus a subsequent prosecution for the greater CCE offense is barred by the earlier conviction of the lesser marihuana importation offense. Where the same conduct violates two statutory provisions, the first step in the double jeopardy analysis is to determine whether the legislature in this case Congress intended that each violation be a separate offense. If Congress intended that there be only one offense that is, a defendant could be convicted under either statutory provision for a single act, but not under both there would be no statutory authorization for a subsequent prosecution after conviction of one of the two provisions, and that would end the double jeopardy analysis. Cf. This question of legislative intent arose in Blockburger in the context of multiple punishments imposed in a single prosecution. Based on one drug sale, Blockburger was convicted of both selling a drug not in the original stamped package and selling it not in pursuance of a written order of the purchaser. The sale violated two separate statutory provisions, and the question was whether "the accused committed two offenses or only one." -304. The rule stated in Blockburger was applied as a rule of statutory construction to *779 help determine legislative intent. Significantly, after setting out the rule, the Court cited a paragraph in at which included the following statement: "There is nothing in the Constitution which prevents Congress from punishing separately each step leading to the consummation of a transaction which it has power to prohibit and punishing also the completed transaction" (emphasis added). We have recently indicated that the Blockburger rule is not controlling when the legislative intent is clear from the face of the statute or the legislative history. ; ; Indeed, it would be difficult to contend otherwise without converting what is essentially a factual inquiry as to legislative intent into a conclusive presumption of law. In the present case the application of the Blockburger rule as a conclusive determinant of legislative intent, rather than as a useful canon of statutory construction, would lead to the conclusion urged by Garrett: that Congress intended the conduct at issue to be punishable either as a predicate offense, or as a CCE offense, but not both. The language, structure, and legislative history of the Comprehensive Drug Abuse, Prevention and Control Act of 1970, however, show in the plainest way that Congress intended the CCE provision to be a separate criminal offense which was punishable in addition to, and not as a substitute for, the predicate offenses. Insofar as the question is one of legislative intent, the Blockburger presumption must of course yield to a plainly expressed contrary view on the part of Congress. The language of 21 U.S. C. 848, which is set out in full in the margin,[1] affirmatively states an offense for which punishment will be imposed. It begins: *780 "Any person who engages in a continuing criminal enterprise shall be sentenced to a term of imprisonment which may not be less than 10 years and which may be *781 up to life imprisonment, to a fine of not more than $100,000, and to the forfeiture prescribed in paragraph (2)." 848(a)(1). At this point there is no reference to other statutory offenses, and a separate penalty is set out, rather than a multiplier of the penalty established for some other offense. This same paragraph then incorporates its own recidivist provision, providing for twice the penalty for repeat violators of this section. Significantly the language expressly refers to "one or more prior convictions under this section." Next, subparagraph (2), which sets out various forfeiture provisions, also refers to any person "who is convicted under paragraph (1) of engaging in a continuing criminal enterprise," again suggesting that 848 is a distinct offense for which one is separately convicted. Subsection (b) of 848 defines the conduct that constitutes being "engaged in a continuing criminal enterprise": "(1) he violates any provision of this subchapter or subchapter II of this chapter [establishing various drug offenses] the punishment for which is a felony, and "(2) such violation is a part of a continuing series of violations of this subchapter or subchapter II of this chapter "(A) which are undertaken by such person in concert with five or more other persons with respect to whom such person occupies a position of organizer, a supervisory position, or any other position of management, and "(B) from which such person obtains substantial income or resources." A common-sense reading of this definition reveals a carefully crafted prohibition aimed at a special problem. This language is designed to reach the "top brass" in the drug rings, not the lieutenants and foot soldiers. The definition of a continuing criminal enterprise is not drafted in the way that a recidivist provision would be *782 drafted. Indeed 848(a)(1), as already noted, contains language that is typical of that sort of provision. Moreover, the very next section of the statute entitled "Dangerous Special Drug Offender Sentencing" is a recidivist provision. It is drafted in starkly contrasting language which plainly is not intended to create a separate offense. For example, it provides for a special hearing before the court sitting without a jury to consider the evidence of prior offenses, and the determination that a defendant is a dangerous special drug offender is made on a preponderance of the information by the court. See 21 U.S. C. 849. This conclusion as to Congress' intent is fortified by the legislative history. H. R. 18583 is the bill that was enacted to become the Comprehensive Drug Abuse Prevention and Control Act of 1970. In its section-by-section analysis, the House Committee Report states: "Section 408(a) [21 U.S. C. 848(a)] provides that any person who engages in a continuing criminal enterprise shall upon conviction for that offense be sentenced to a term of imprisonment for not less than 10 years and up to life If the person engages in this activity subsequent to one or more convictions under this section, he shall receive a penalty of not less than 20 years' imprisonment." H. R. Rep. No. 91-1444, pt. 1, p. 50 (1970) (emphasis added). The intent to create a separate offense could hardly be clearer. As originally introduced in the House, H. R. 18583 had a section entitled "Continuing Criminal Enterprises" which in reality was a recidivist provision, like the current 21 U.S. C. 849, that provided for enhanced sentences for "a special offender," who "committed [a drug] felony as part of a pattern of conduct which was criminal under applicable laws of any jurisdiction, which constituted a substantial source of his income, and in which he manifested special skill or expertise." The House Committee substituted for this provision *783 an amendment offered by Representative Dingell that ultimately became the current 848. "Instead of providing a post-conviction-presentencing procedure, [the Dingell amendment] made engagement in a continuing criminal enterprise a new and distinct offense with all its elements triable in court." H. R. Rep. No. 91-1444, pt. 1, pp. 83-84 (1970) (additional views); see 6 Cong. Rec. 33302 (1970) (remarks of Rep. Eckhardt). During consideration of the bill by the full House, Representative Poff offered an amendment which would restore the recidivist provision to the bill in addition to the Dingell provision. Explaining the differences between the two approaches, Representative Eckhardt stated: "[T]he Dingell amendment created a new offense which would have to be triable in all its parts by admissible evidence brought before the court, whereas the postconviction presentence [procedure] of the original bill similar to the Poff provisions provided that some report upon which sentence would be based would be available to the judge, cross-examination would be available of those who presented the report, but not of those who may have contributed to it." Later in the debate, Representative Poff explained his proposed amendment further: "Mr. Chairman, the most dangerous criminal in the criminal drug field is the organized crime offender, the habitual offender, the professional criminal. "Mr. Chairman, we need special penalties in my opinion for these special criminals. Constitutional scholars have suggested two approaches to deal with such offenders. The first is the creation of a separate crime with separate penalties. The second approach is the imposition of longer sentences upon those convicted first of the basic crime and then shown to be dangerous offenders. "Mr. Chairman, the first approach, the separate crime approach, is the approach taken by section 408 of the *784 Committee bill [21 U.S. C. 848]. The second is found in the amendment which I have just offered which adds two new sections to the bill, sections 409 and 410 [21 U.S. C. 849 and 850]." The distinction between the two approaches was emphasized in the continuing debate. For example, Representative Eckhardt stated: "Under the Dingell amendment, if you are going to prove a man guilty, you have to come into court and prove every element of the continuing criminal offense." Representative Poff concurred in this characterization of the CCE provision "which embodies a new separate criminal offense with a separate criminal penalty." Representative Poff distinguished this approach from his proposed amendment which "authorizes the judge to impose the extended sentence upon the defendant in the dock who has already been found guilty by the jury of the basic charge." The Poff amendment was adopted, and both approaches are contained in the statute, 21 U.S. C. 848, 849, and 850. In view of this legislative history, it is indisputable that Congress intended to create a separate CCE offense. One could still argue, however, that having created the separate offense, Congress intended it, where applicable, to be a substitute for the predicate offenses. Nowhere in the legislative history is it stated that a big-time drug operator could be prosecuted and convicted for the separate predicate offenses as well as the CCE offense. The absence of such a statement, however, is not surprising; given the motivation behind the legislation and the temper of the debate, such a statement would merely have stated the obvious. Congress was seeking to add a new enforcement tool to the substantive drug offenses already available to prosecutors. During the debate on the Poff amendment, for example, Representative Fascell stated: "I see no reason to treat a drug trafficker any less harshly than an organized crime racketeer. Their acts are equally heinous, the consequences equally severe, *785 and their punishment equally justified." Representative Weicker stated: "The penalty structure has been designed to accommodate all types of drug offenders, from the casual drug user and experimenter to the organized crime syndicates engaged in unlawful transportation and distribution of illicit drugs." He continued, "This bill goes further in providing those persons charged with enforcing it a wide variety of enforcement tools which will enable them to more effectively combat the illicit drug trafficker and meet the increased demands we have imposed on them." Representative Taft stated: "[T]his amendment will do much at least to help a coordinated attack on the organized crime problem within the purview of this legislation. Hopefully, we will see other legislation coming along broadening the attack on the crime syndicates even further." 6 Cong. Rec. 33630-33631 (1970). It runs counter to common sense to infer from comments such as these, which pervade the entire debate and which stand unrebutted, that Congress intended to substitute the CCE offense for the underlying predicate offenses in the case of a big-time drug dealer rather than to permit prosecution for CCE in addition to prosecution for the predicate offenses. Finally, it would be illogical for Congress to intend that a choice be made between the predicate offenses and the CCE offense in pursuing major drug dealers. While in the instant case Garrett claims that the Government was aware of the possibility of bringing the CCE charge before he was indicted on the Washington offenses, in many cases the Government would catch a drug dealer for one offense before it was aware of or had the evidence to make a case for other drug offenses he had committed or in the future would commit. The Government would then be forced to choose between prosecuting the dealer on the offense of which it could prove him guilty or releasing him with the idea that he would continue his drug-dealing activities so that the Government might catch him twice more and then be able to prosecute him on the CCE *786 offense. Such a situation is absurd and clearly not what Congress intended. II Having determined that Congress intended CCE to be a separate offense and that it intended to permit prosecution for both the predicate offenses and the CCE offense, we must now determine whether prosecution for a CCE offense after an earlier prosecution for a predicate offense is constitutional under the Double Jeopardy Clause of the Fifth Amendment. The Double Jeopardy Clause provides: "[N]or shall any person be subject for the same offence to be twice put in jeopardy of life or limb." The critical inquiry is whether a CCE offense is considered the "same offense" as one or more of its predicate offenses within the meaning of the Double Jeopardy Clause. Quite obviously the CCE offense is not, in any commonsense or literal meaning of the term, the "same" offense as one of the predicate offenses. The CCE offense requires the jury to find that the defendant committed a predicate offense, and in addition that the predicate offense was part of a continuing series of predicate offenses undertaken by the defendant in concert with five or more other persons, that the defendant occupied the position of an organizer or manager, and that the defendant obtained substantial income or resources from the continuing series of violations. In order to properly analyze the successive prosecution issue, we must examine not only the statute which Congress has enacted, but also the charges which form the basis of the Government's prosecution here. Petitioner pleaded guilty in the Western District of Washington in May 1981 to a count charging importation of 12,000 pounds of marihuana at Neah Bay, Washington, on August 26, 1980. He was indicted in the Northern District of Florida in July 1981, on charges of conspiring to import "multi-ton quantities of marihuana and marihuana `Thai sticks' " from January 1976 to July 16, 1981; *787 of conspiring to possess with intent to distribute marihuana over the same period of time; and of engaging in a continuing criminal enterprise over the same period of time. Thus at the very moment he made his motion to require "consolidation" of all the charges against him in the Western District of Washington, he was engaging in criminal conduct of which he was later found guilty by a jury in the Northern District of Florida. Petitioner contends that the marihuana importation charge to which he pleaded guilty in Washington was a "lesser included offense" of the CCE offense of which he was convicted in Florida. He points out that evidence of the Washington offense was introduced at the Florida trial, and that the jury was permitted to find that the Washington violation was one of the "predicate offenses" for the CCE charge in Florida. He relies on for his conclusion that the use of the Washington offense as an element of the Florida charge placed him twice in jeopardy in violation of the Fifth Amendment to the United Constitution. held that, where the misdemeanor of joyriding was a lesser included offense in the felony of auto theft, a prosecution for the misdemeanor barred a second prosecution for the felony. We think there is a good deal of difference between the classic relation of the "lesser included offense" to the greater offense presented in Brown, on the one hand, and the relationship between the Washington marihuana offense and the CCE charge involved in this case, on the other, The defendant in Brown had stolen an automobile and driven it for several days. He had engaged in a single course of conduct driving a stolen car. The very same conduct would support a misdemeanor prosecution for joyriding or a felony prosecution for auto theft, depending only on the defendant's state of mind while he engaged in the conduct in question. Every moment of his conduct was as relevant to the joyriding charge as it was to the auto theft charge. *788 In the case before us the situation is quite different. The count in the Washington indictment to which Garrett pleaded guilty charged importation of 12,000 pounds of marihuana at Neah Bay on August 26, 1980. The Washington indictment was returned on March 17, 1981, and a guilty plea entered on May 18, 1981. Two other counts of the indictment, including causing interstate travel to facilitate importation of marihuana on or about October 24, 1979, were dismissed without prejudice to the Government's right subsequently to prosecute any other offense Garrett may have committed. The CCE indictment returned against Garrett in Florida was returned on July 16, 1981. It charged that he had, from January 1976, "up to and including [July 16, 1981]," conspired in that district and "divers other districts" to import multiton quantities of marihuana and marihuana "Thai sticks" in violation of applicable federal law. Another count charged conspiracy to possess with intent to distribute marihuana over the same period of more than five years. A third count of the Florida indictment charged that Garrett had engaged in the Northern District of Florida and in "divers other districts" in a continuing criminal enterprise over the same 51/2-year period. Obviously the conduct in which Garrett was charged with engaging in the Florida indictment, when compared with that with which he was charged in the Washington indictment, does not lend itself to the simple analogy of a single course of conduct stealing a car comprising a lesser included misdemeanor within a felony. Here the continuing criminal enterprise was alleged to have spanned more than five years; the acts charged in the Washington indictment were alleged to have occurred on single days in 1979 and 1980, respectively. Whenever it was during the 5 1/2-year period alleged in the indictment that Garrett committed the first of the three predicate offenses required to form the basis for a CCE prosecution, it could not then have been said with any certainty that he would necessarily go ahead and commit the *789 other violations required to render him liable on a CCE charge. Every minute that Nathaniel Brown drove or possessed the stolen automobile he was simultaneously committing both the lesser included misdemeanor and the greater felony, but the same simply is not true of Garrett. His various boatload smuggling operations in Louisiana, for example, obviously involved incidents of conduct wholly separate from his "mother boat" operations in Washington. These significant differences caution against ready transposition of the "lesser included offense" principles of double jeopardy from the classically simple situation presented in Brown to the multilayered conduct, both as to time and to place, involved in this case. Were we to sustain Garrett's claim, the Government would have been able to proceed against him in either one of only two ways. It would have to have withheld the Washington charges, alleging crimes committed in October 1979 and August 1980, from the grand jury which indicted Garrett in March 1981, until it was prepared to present to a grand jury the CCE charge which was alleged to have been, and found by a jury to be, continuing on each of those dates; or it would have to have submitted the CCE charge to the Washington grand jury in March 1981, even though the indictment ultimately returned against Garrett on that charge alleged that the enterprise had continued until July 1981.[2] We do not *790 think that the Double Jeopardy Clause may be employed to force the Government's hand in this manner, however we were to resolve Garrett's lesser-included-offense argument. One who insists that the music stop and the piper be paid at a particular point must at least have stopped dancing himself before he may seek such an accounting. Petitioner urges that "[w]here the charges arise from a single criminal act, occurrence, episode, or transaction, they must be tried in a single proceeding." We have steadfastly refused to adopt the "single transaction" view of the Double Jeopardy Clause. But it would seem to strain even that doctrine to describe Garrett's multifarious multistate activities as a "single transaction." For the reasons previously stated, we also have serious doubts as to whether the offense to which Garrett pleaded guilty in Washington was a "lesser included offense" within the CCE charge so that the prosecution of the former would bar a prosecution of the latter. But we may assume, for purposes of decision here, that the Washington offense was a lesser included offense, because in our view Garrett's claim of double jeopardy would still not be sustainable. *791 In the Court had before it an initial prosecution for assault and battery, followed by a prosecution for homicide when the victim eventually died from injuries inflicted in the course of the assault. The Court rejected the defendant's claim of double jeopardy, holding that the two were not the "same offense": "The homicide charged against the accused in the Court of First Instance and the assault and battery for which he was tried before the justice of the peace, although identical in some of their elements, were distinct offenses both in law and in fact. The death of the injured person was the principal element of the homicide, but was no part of the assault and battery. At the time of the trial for the latter the death had not ensued, and not until it did ensue was the homicide committed. Then, and not before, was it possible to put the accused in jeopardy for that offense." In the present case, as in Diaz, the continuing criminal enterprise charged against Garrett in Florida had not been completed at the time that he was indicted in Washington. The latter event took place in March 1981, whereas the continuing criminal enterprise charged in the Florida indictment and found by the trial jury extended from January 1976 to July 1981. The evidence at trial showed, for example, that Garrett was arrested for traffic offenses and other violations on July 23, 1981, while out on bail pending sentencing for the Washington conviction. He told the arresting officer that the officer had caught "somebody big" and that he was a "smuggler." At the time of the arrest, Garrett was carrying $6,253 in cash. About $30 of this was in quarters. He explained that he needed them to make long-distance phone calls, on which he sometimes spent $25 to $50 a day. He also told the arresting officer and a federal agent who interviewed him the next morning that he had just bought the truck he *792 had been driving for $13,000 cash and that he used it for smuggling. He further stated that he had a yacht in Hawaii which he had purchased for $160,000 cash. This evidence is consistent with the jury's verdict that Garrett continued his CCE activities into July 1981. We think this evidence not only permits but requires the conclusion that the CCE charged in Florida, alleged to have begun in January 1976, and continued up to mid-July 1981, was under Diaz a different offense from that charged in the Washington indictment. We cannot tell, without considerable sifting of the evidence and speculating as to what juries might do, whether the Government could in March 1981 have successfully indicted and prosecuted Garrett for a different continuing criminal enterprise one ending in March 1981. But we do not think any such sifting or speculation is required at the behest of one who at the time the first indictment is returned is continuing to engage in other conduct found criminal by the jury which tried the second indictment. It may well be, as JUSTICE STEVENS suggests in his dissenting opinion, that the Florida indictment did not by its terms indicate that the Neah Bay importation would be used as evidence to support it, post, at 804-805, and therefore at the time the pretrial motion to dismiss on double jeopardy grounds was made the District Court in Florida could not have rendered an informed decision on petitioner's motion. But there can be no doubt that by the time the evidence had all been presented in the Florida trial, and the jury was charged, only one reasonable conclusion could be drawn by the District Court: the Government's evidence with respect to the CCE charge included acts which took place after March 1981, the date of the Washington indictment, and up to and including July 1981. Therefore, the continuing criminal enterprise charged by the Government had not been completed at the time the Washington indictment was returned, and under the Diaz rule evidence of the Neah *793 Bay importation might be used to show one of the predicate offenses.[3] Having concluded that Congress intended CCE to be a separate offense and that it does not violate the Double Jeopardy Clause under the facts of this case to prosecute the CCE offense after a prior conviction for one of the predicate offenses, the only remaining issue is whether the Double Jeopardy Clause bars cumulative punishments. Garrett's sentence on the CCE conviction was consecutive to his sentence on the Washington conviction. In this connection, "the Double Jeopardy Clause does no more than prevent the sentencing court from prescribing greater punishment than the legislature intended." ; As discussed above, Congress intended to create a separate offense. The presumption when Congress creates two distinct offenses is that it intends to permit cumulative sentences, and legislative silence on this specific issue does not establish an ambiguity or rebut this presumption: "[T]he defendants] read much into nothing. Congress cannot be expected to specifically address each issue of statutory construction which may arise. But, as we have previously noted, Congress is `predominantly a lawyer's body,' and it is appropriate for us `to assume that our elected representatives know the law.' As a result if anything is to be assumed from the congressional silence on this point, it is that Congress was aware of the Blockburger rule and legislated with it in mind. It is not a function of this Court to presume that *794 `Congress was unaware of what it accomplished.' " Here, of course, Congress was not silent as to its intent to create separate offenses notwithstanding Blockburger, and we can assume it was aware that doing so would authorize cumulative punishments absent some indication of contrary intent. Moreover, disallowing cumulative sentences would have the anomalous effect in many cases of converting the large fines provided by 848 into ceilings. Congress established the large fines in 848 in an effort to deprive big-time drug dealers of some of their enormous profits, which often cannot be traced directly to their crimes for forfeiture purposes. The fines for a three-time offender who has been previously convicted of a drug felony could amount to $150,000 for the predicate offenses standing alone an amount that exceeds the ceiling for a first-time CCE fine. Compare 841(b)(1)(A) with 848(a)(1). Congress was bent on depriving the big-time drug dealer of his profits; it is doubtful that Congress intended to force an election of a lower maximum fine in such a situation in order to attempt to obtain the life imprisonment penalty available under the CCE provision. In -157, a plurality of this Court stated that 848 "reflects a comprehensive penalty structure that leaves little opportunity for pyramiding of penalties from other sections of the Comprehensive Drug Abuse Prevention and Control Act of 1970." The focus of the analysis in Jeffers was the permissibility of cumulative punishments for conspiracy under 846 and for CCE under 848, and the plurality reasonably concluded that the dangers posed by a conspiracy and a CCE were similar and thus there would be little purpose in cumulating the penalties. The same is not true of the substantive offenses created by the Act and conspiracy, and by the same logic, it is not true of the substantive offenses and CCE. We have been required in the present case, as we were not in Jeffers, to consider the relationship between substantive predicate offenses and a *795 CCE. We think here logic supports the conclusion, also indicated by the legislative history, that Congress intended separate punishments for the underlying substantive predicates and for the CCE offense. Congress may, of course, so provide if it wishes. The judgment of the Court of Appeals is affirmed. It is so ordered. JUSTICE POWELL took no part in the decision of this case. |
Justice Stevens | majority | false | Ferguson v. Charleston | 2001-03-21T00:00:00 | null | https://www.courtlistener.com/opinion/118414/ferguson-v-charleston/ | https://www.courtlistener.com/api/rest/v3/clusters/118414/ | 2,001 | 2000-034 | 2 | 6 | 3 | In this case, we must decide whether a state hospital's performance of a diagnostic test to obtain evidence of a patient's criminal conduct for law enforcement purposes is an *70 unreasonable search if the patient has not consented to the procedure. More narrowly, the question is whether the interest in using the threat of criminal sanctions to deter pregnant women from using cocaine can justify a departure from the general rule that an official nonconsensual search is unconstitutional if not authorized by a valid warrant.
I
In the fall of 1988, staff members at the public hospital operated in the city of Charleston by the Medical University of South Carolina (MUSC) became concerned about an apparent increase in the use of cocaine by patients who were receiving prenatal treatment.[1] In response to this perceived increase, as of April 1989, MUSC began to order drug screens to be performed on urine samples from maternity patients who were suspected of using cocaine. If a patient tested positive, she was then referred by MUSC staff to the county substance abuse commission for counseling and treatment. However, despite the referrals, the incidence of cocaine use among the patients at MUSC did not appear to change.
Some four months later, Nurse Shirley Brown, the case manager for the MUSC obstetrics department, heard a news broadcast reporting that the police in Greenville, South Carolina, were arresting pregnant users of cocaine on the theory that such use harmed the fetus and was therefore child abuse.[2] Nurse Brown discussed the story with MUSC's general counsel, Joseph C. Good, Jr., who then contacted *71 Charleston Solicitor Charles Condon in order to offer MUSC's cooperation in prosecuting mothers whose children tested positive for drugs at birth.[3]
After receiving Good's letter, Solicitor Condon took the first steps in developing the policy at issue in this case. He organized the initial meetings, decided who would participate, and issued the invitations, in which he described his plan to prosecute women who tested positive for cocaine while pregnant. The task force that Condon formed included representatives of MUSC, the police, the County Substance Abuse Commission and the Department of Social Services. Their deliberations led to MUSC's adoption of a 12-page document entitled "POLICY M-7," dealing with the subject of "Management of Drug Abuse During Pregnancy." App. to Pet. for Cert. A-53.
The first three pages of Policy M-7 set forth the procedure to be followed by the hospital staff to "identify/assist pregnant patients suspected of drug abuse." Id., at A-53 to A-56. The first section, entitled the "Identification of Drug Abusers," provided that a patient should be tested for cocaine through a urine drug screen if she met one or more of nine criteria.[4] It also stated that a chain of custody should *72 be followed when obtaining and testing urine samples, presumably to make sure that the results could be used in subsequent criminal proceedings. The policy also provided for education and referral to a substance abuse clinic for patients who tested positive. Most important, it added the threat of law enforcement intervention that "provided the necessary `leverage' to make the [p]olicy effective." Brief for Respondents 8. That threat was, as respondents candidly acknowledge, essential to the program's success in getting women into treatment and keeping them there.
The threat of law enforcement involvement was set forth in two protocols, the first dealing with the identification of drug use during pregnancy, and the second with identification of drug use after labor. Under the latter protocol, the police were to be notified without delay and the patient promptly arrested. Under the former, after the initial positive drug test, the police were to be notified (and the patient arrested) only if the patient tested positive for cocaine a second time or if she missed an appointment with a substance abuse counselor.[5] In 1990, however, the policy was modified at the behest of the solicitor's office to give the patient who tested positive during labor, like the patient who tested positive during a prenatal care visit, an opportunity to avoid arrest by consenting to substance abuse treatment.
The last six pages of the policy contained forms for the patients to sign, as well as procedures for the police to follow when a patient was arrested. The policy also prescribed in detail the precise offenses with which a woman could be charged, depending on the stage of her pregnancy. If the pregnancy was 27 weeks or less, the patient was to be charged with simple possession. If it was 28 weeks or more, she was to be charged with possession and distribution to a person under the age of 18in this case, the fetus. If she *73 delivered "while testing positive for illegal drugs," she was also to be charged with unlawful neglect of a child. App. to Pet. for Cert. A-62. Under the policy, the police were instructed to interrogate the arrestee in order "to ascertain the identity of the subject who provided illegal drugs to the suspect." Id., at A-63. Other than the provisions describing the substance abuse treatment to be offered to women who tested positive, the policy made no mention of any change in the prenatal care of such patients, nor did it prescribe any special treatment for the newborns.
II
Petitioners are 10 women who received obstetrical care at MUSC and who were arrested after testing positive for cocaine. Four of them were arrested during the initial implementation of the policy; they were not offered the opportunity to receive drug treatment as an alternative to arrest. The others were arrested after the policy was modified in 1990; they either failed to comply with the terms of the drug treatment program or tested positive for a second time. Respondents include the city of Charleston, law enforcement officials who helped develop and enforce the policy, and representatives of MUSC.
Petitioners' complaint challenged the validity of the policy under various theories, including the claim that warrantless and nonconsensual drug tests conducted for criminal investigatory purposes were unconstitutional searches. Respondents advanced two principal defenses to the constitutional claim: (1) that, as a matter of fact, petitioners had consented to the searches; and (2) that, as a matter of law, the searches were reasonable, even absent consent, because they were justified by special non-law-enforcement purposes. The District Court rejected the second defense because the searches in question "were not done by the medical university for independent purposes. [Instead,] the police came in and there was an agreement reached that the positive *74 screens would be shared with the police." App. 1248-1249. Accordingly, the District Court submitted the factual defense to the jury with instructions that required a verdict in favor of petitioners unless the jury found consent.[6] The jury found for respondents.
Petitioners appealed, arguing that the evidence was not sufficient to support the jury's consent finding. The Court of Appeals for the Fourth Circuit affirmed, but without reaching the question of consent. 186 F.3d 469 (1999). Disagreeing with the District Court, the majority of the appellate panel held that the searches were reasonable as a matter of law under our line of cases recognizing that "special needs" may, in certain exceptional circumstances, justify a search policy designed to serve non-law-enforcement ends.[7]*75 On the understanding "that MUSC personnel conducted the urine drug screens for medical purposes wholly independent of an intent to aid law enforcement efforts,"[8]id., at 477, the majority applied the balancing test used in Treasury Employees v. Von Raab, 489 U.S. 656 (1989), and Vernonia School Dist. 47J v. Acton, 515 U.S. 646 (1995), and concluded that the interest in curtailing the pregnancy complications and medical costs associated with maternal cocaine use outweighed what the majority termed a minimal intrusion on the privacy of the patients. In dissent, Judge Blake concluded that the "special needs" doctrine should not apply and *76 that the evidence of consent was insufficient to sustain the jury's verdict. 186 F.3d, at 487-488.
We granted certiorari, 528 U.S. 1187 (2000), to review the appellate court's holding on the "special needs" issue. Because we do not reach the question of the sufficiency of the evidence with respect to consent, we necessarily assume for purposes of our decisionas did the Court of Appealsthat the searches were conducted without the informed consent of the patients. We conclude that the judgment should be reversed and the case remanded for a decision on the consent issue.
III
Because MUSC is a state hospital, the members of its staff are government actors, subject to the strictures of the Fourth Amendment. New Jersey v. T. L. O., 469 U.S. 325, 335-337 (1985). Moreover, the urine tests conducted by those staff members were indisputably searches within the meaning of the Fourth Amendment. Skinner v. Railway Labor Executives' Assn., 489 U.S. 602, 617 (1989).[9] Neither the District Court nor the Court of Appeals concluded that any of the nine criteria used to identify the women to be searched provided either probable cause to believe that they were using cocaine, or even the basis for a reasonable suspicion of such use. Rather, the District Court and the Court of Appeals viewed the case as one involving MUSC's right *77 to conduct searches without warrants or probable cause.[10] Furthermore, given the posture in which the case comes to us, we must assume for purposes of our decision that the tests were performed without the informed consent of the patients.[11]
Because the hospital seeks to justify its authority to conduct drug tests and to turn the results over to law enforcement agents without the knowledge or consent of the patients, this case differs from the four previous cases in which we have considered whether comparable drug tests "fit within the closely guarded category of constitutionally permissible suspicionless searches." Chandler v. Miller, 520 U.S. 305, 309 (1997). In three of those cases, we sustained drug tests for railway employees involved in train accidents, Skinner v. Railway Labor Executives' Assn., 489 U.S. 602 (1989), for United States Customs Service employees seeking promotion to certain sensitive positions, Treasury Employees v. Von Raab, 489 U.S. 656 (1989), and for high school students participating in interscholastic sports, Vernonia School Dist. 47J v. Acton, 515 U.S. 646 (1995). In the fourth case, we struck down such testing for candidates for designated state offices as unreasonable. Chandler v. Miller, 520 U.S. 305 (1997).
*78 In each of those cases, we employed a balancing test that weighed the intrusion on the individual's interest in privacy against the "special needs" that supported the program. As an initial matter, we note that the invasion of privacy in this case is far more substantial than in those cases. In the previous four cases, there was no misunderstanding about the purpose of the test or the potential use of the test results, and there were protections against the dissemination of the results to third parties.[12] The use of an adverse test result to disqualify one from eligibility for a particular benefit, such as a promotion or an opportunity to participate in an extracurricular activity, involves a less serious intrusion on privacy than the unauthorized dissemination of such results to third parties. The reasonable expectation of privacy enjoyed by the typical patient undergoing diagnostic tests in a hospital is that the results of those tests will not be shared with nonmedical personnel without her consent. See Brief for American Medical Association as Amicus Curiae 11; Brief for American Public Health Association et al. as Amici Curiae 6, 17-19.[13] In none of our prior cases was there any intrusion upon that kind of expectation.[14]
*79 The critical difference between those four drug-testing cases and this one, however, lies in the nature of the "special need" asserted as justification for the warrantless searches. In each of those earlier cases, the "special need" that was advanced as a justification for the absence of a warrant or individualized suspicion was one divorced from the State's general interest in law enforcement.[15] This point was emphasized *80 both in the majority opinions sustaining the programs in the first three cases,[16] as well as in the dissent in the Chandler case.[17] In this case, however, the central and indispensable feature of the policy from its inception was the use of law enforcement to coerce the patients into substance abuse treatment. This fact distinguishes this case from circumstances in which physicians or psychologists, in the *81 course of ordinary medical procedures aimed at helping the patient herself, come across information that under rules of law or ethics is subject to reporting requirements, which no one has challenged here. See, e. g., Council on Ethical and Judicial Affairs, American Medical Association, PolicyFinder, Current Opinions E-5.05 (2000) (requiring reporting where "a patient threatens to inflict serious bodily harm to another person or to him or herself and there is a reasonable probability that the patient may carry out the threat"); Ark. Code Ann. § 12-12-602 (1999) (requiring reporting of intentionally inflicted knife or gunshot wounds); Ariz. Rev. Stat. Ann. § 13-3620 (Supp. 2000) (requiring "any . . . person having responsibility for the care or treatment of children" to report suspected abuse or neglect to a peace officer or child protection agency).[18]
Respondents argue in essence that their ultimate purposenamely, protecting the health of both mother and childis a beneficent one. In Chandler, however, we did not simply accept the State's invocation of a "special need." Instead, we carried out a "close review" of the scheme at issue before concluding that the need in question was not "special," as that term has been defined in our cases. 520 U.S., at 322. In this case, a review of the M-7 policy plainly reveals that the purpose actually served by the MUSC searches "is ultimately indistinguishable from the general interest in crime control." Indianapolis v. Edmond, 531 U.S. 32, 44 (2000).
In looking to the programmatic purpose, we consider all the available evidence in order to determine the relevant primary purpose. See, e. g., id., at 45-47. In this case, as *82 Judge Blake put it in her dissent below, "it . . . is clear from the record that an initial and continuing focus of the policy was on the arrest and prosecution of drug-abusing mothers . . . ." 186 F.3d, at 484. Tellingly, the document codifying the policy incorporates the police's operational guidelines. It devotes its attention to the chain of custody, the range of possible criminal charges, and the logistics of police notification and arrests. Nowhere, however, does the document discuss different courses of medical treatment for either mother or infant, aside from treatment for the mother's addiction.
Moreover, throughout the development and application of the policy, the Charleston prosecutors and police were extensively involved in the day-to-day administration of the policy. Police and prosecutors decided who would receive the reports of positive drug screens and what information would be included with those reports. App. 78-80, 145-146, 1058-1060. Law enforcement officials also helped determine the procedures to be followed when performing the screens.[19]Id., at 1052-1053. See also id., at 26-27, 945. In the course of the policy's administration, they had access to Nurse Brown's medical files on the women who tested positive, routinely attended the substance abuse team's meetings, and regularly received copies of team documents discussing the women's progress. Id., at 122-124, 609-610. Police took pains to coordinate the timing and circumstances of the arrests with MUSC staff, and, in particular, Nurse Brown. Id., at 1057-1058.
While the ultimate goal of the program may well have been to get the women in question into substance abuse treatment *83 and off of drugs, the immediate objective of the searches was to generate evidence for law enforcement purposes[20] in order to reach that goal.[21] The threat of law enforcement *84 may ultimately have been intended as a means to an end, but the direct and primary purpose of MUSC's policy was to ensure the use of those means. In our opinion, this distinction is critical. Because law enforcement involvement always serves some broader social purpose or objective, under respondents' view, virtually any nonconsensual suspicionless search could be immunized under the special needs doctrine by defining the search solely in terms of its ultimate, rather than immediate, purpose.[22] Such an approach is inconsistent with the Fourth Amendment. Given the primary purpose of the Charleston program, which was to use the threat of arrest and prosecution in order to force women into treatment, and given the extensive involvement of law enforcement officials at every stage of the policy, this case simply does not fit within the closely guarded category of "special needs."[23]
The fact that positive test results were turned over to the police does not merely provide a basis for distinguishing our prior cases applying the "special needs" balancing approach to the determination of drug use. It also provides an affirmative reason for enforcing the strictures of the Fourth Amendment. While state hospital employees, like other citizens, may have a duty to provide the police with evidence *85 of criminal conduct that they inadvertently acquire in the course of routine treatment, when they undertake to obtain such evidence from their patients for the specific purpose of incriminating those patients, they have a special obligation to make sure that the patients are fully informed about their constitutional rights, as standards of knowing waiver require.[24] Cf. Miranda v. Arizona, 384 U.S. 436 (1966).
As respondents have repeatedly insisted, their motive was benign rather than punitive. Such a motive, however, cannot justify a departure from Fourth Amendment protections, given the pervasive involvement of law enforcement with the development and application of the MUSC policy. The stark *86 and unique fact that characterizes this case is that Policy M-7 was designed to obtain evidence of criminal conduct by the tested patients that would be turned over to the police and that could be admissible in subsequent criminal prosecutions. While respondents are correct that drug abuse both was and is a serious problem, "the gravity of the threat alone cannot be dispositive of questions concerning what means law enforcement officers may employ to pursue a given purpose." Indianapolis v. Edmond, 531 U. S., at 42-43. The Fourth Amendment's general prohibition against nonconsensual, warrantless, and suspicionless searches necessarily applies to such a policy. See, e. g., Chandler, 520 U. S., at 308; Skinner, 489 U. S., at 619.
Accordingly, the judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings consistent with this opinion.
It is so ordered.
Justice Kennedy, concurring in the judgment. | In this case, we must decide whether a state hospital's performance of a diagnostic test to obtain evidence of a patient's criminal conduct for law enforcement purposes is an *70 unreasonable search if the patient has not consented to the procedure. More narrowly, the question is whether the interest in using the threat of criminal sanctions to deter pregnant women from using cocaine can justify a departure from the general rule that an official nonconsensual search is unconstitutional if not authorized by a valid warrant. I In the fall of 1988, staff members at the public hospital operated in the city of Charleston by the Medical University of South Carolina (MUSC) became concerned about an apparent increase in the use of cocaine by patients who were receiving prenatal treatment.[1] In response to this perceived increase, as of April 1989, MUSC began to order drug screens to be performed on urine samples from maternity patients who were suspected of using cocaine. If a patient tested positive, she was then referred by MUSC staff to the county substance abuse commission for counseling and treatment. However, despite the referrals, the incidence of cocaine use among the patients at MUSC did not appear to change. Some four months later, Nurse Shirley Brown, the case manager for the MUSC obstetrics department, heard a news broadcast reporting that the police in Greenville, South Carolina, were arresting pregnant users of cocaine on the theory that such use harmed the fetus and was therefore child abuse.[2] Nurse Brown discussed the story with MUSC's general counsel, Joseph C. Good, Jr., who then contacted *71 Charleston Solicitor Charles Condon in order to offer MUSC's cooperation in prosecuting mothers whose children tested positive for drugs at birth.[3] After receiving Good's letter, Solicitor Condon took the first steps in developing the policy at issue in this case. He organized the initial meetings, decided who would participate, and issued the invitations, in which he described his plan to prosecute women who tested positive for cocaine while pregnant. The task force that Condon formed included representatives of MUSC, the police, the County Substance Abuse Commission and the Department of Social Services. Their deliberations led to MUSC's adoption of a 12-page document entitled "POLICY M-7," dealing with the subject of "Management of Drug Abuse During Pregnancy." App. to Pet. for Cert. A-53. The first three pages of Policy M-7 set forth the procedure to be followed by the hospital staff to "identify/assist pregnant patients suspected of drug abuse." at A-53 to A-56. The first section, entitled the "Identification of Drug Abusers," provided that a patient should be tested for cocaine through a urine drug screen if she met one or more of nine criteria.[4] It also stated that a chain of custody should *72 be followed when obtaining and testing urine samples, presumably to make sure that the results could be used in subsequent criminal proceedings. The policy also provided for education and referral to a substance abuse clinic for patients who tested positive. Most important, it added the threat of law enforcement intervention that "provided the necessary `leverage' to make the [p]olicy effective." Brief for Respondents 8. That threat was, as respondents candidly acknowledge, essential to the program's success in getting women into treatment and keeping them there. The threat of law enforcement involvement was set forth in two protocols, the first dealing with the identification of drug use during pregnancy, and the second with identification of drug use after labor. Under the latter protocol, the police were to be notified without delay and the patient promptly arrested. Under the former, after the initial positive drug test, the police were to be notified (and the patient arrested) only if the patient tested positive for cocaine a second time or if she missed an appointment with a substance abuse counselor.[5] In 1990, however, the policy was modified at the behest of the solicitor's office to give the patient who tested positive during labor, like the patient who tested positive during a prenatal care visit, an opportunity to avoid arrest by consenting to substance abuse treatment. The last six pages of the policy contained forms for the patients to sign, as well as procedures for the police to follow when a patient was arrested. The policy also prescribed in detail the precise offenses with which a woman could be charged, depending on the stage of her pregnancy. If the pregnancy was 27 weeks or less, the patient was to be charged with simple possession. If it was 28 weeks or more, she was to be charged with possession and distribution to a person under the age of 18in this case, the fetus. If she *73 delivered "while testing positive for illegal drugs," she was also to be charged with unlawful neglect of a child. App. to Pet. for Cert. A-62. Under the policy, the police were instructed to interrogate the arrestee in order "to ascertain the identity of the subject who provided illegal drugs to the suspect." at A-63. Other than the provisions describing the substance abuse treatment to be offered to women who tested positive, the policy made no mention of any change in the prenatal care of such patients, nor did it prescribe any special treatment for the newborns. II Petitioners are 10 women who received obstetrical care at MUSC and who were arrested after testing positive for cocaine. Four of them were arrested during the initial implementation of the policy; they were not offered the opportunity to receive drug treatment as an alternative to arrest. The others were arrested after the policy was modified in 1990; they either failed to comply with the terms of the drug treatment program or tested positive for a second time. Respondents include the city of Charleston, law enforcement officials who helped develop and enforce the policy, and representatives of MUSC. Petitioners' complaint challenged the validity of the policy under various theories, including the claim that warrantless and nonconsensual drug tests conducted for criminal investigatory purposes were unconstitutional searches. Respondents advanced two principal defenses to the constitutional claim: (1) that, as a matter of fact, petitioners had consented to the searches; and (2) that, as a matter of law, the searches were reasonable, even absent consent, because they were justified by special non-law-enforcement purposes. The District Court rejected the second defense because the searches in question "were not done by the medical university for independent purposes. [Instead,] the police came in and there was an agreement reached that the positive *74 screens would be shared with the police." App. 1248-1249. Accordingly, the District Court submitted the factual defense to the jury with instructions that required a verdict in favor of petitioners unless the jury found consent.[6] The jury found for respondents. Petitioners appealed, arguing that the evidence was not sufficient to support the jury's consent finding. The Court of Appeals for the Fourth Circuit affirmed, but without reaching the question of consent. Disagreeing with the District Court, the majority of the appellate panel held that the searches were reasonable as a matter of law under our line of cases recognizing that "special needs" may, in certain exceptional circumstances, justify a search policy designed to serve non-law-enforcement ends.[7]*75 On the understanding "that MUSC personnel conducted the urine drug screens for medical purposes wholly independent of an intent to aid law enforcement efforts,"[8] at 477, the majority applied the balancing test used in Treasury and Vernonia School Dist. and concluded that the interest in curtailing the pregnancy complications and medical costs associated with maternal cocaine use outweighed what the majority termed a minimal intrusion on the privacy of the patients. In dissent, Judge Blake concluded that the "special needs" doctrine should not apply and *76 that the evidence of consent was insufficient to sustain the jury's verdict. -488. We granted certiorari, to review the appellate court's holding on the "special needs" issue. Because we do not reach the question of the sufficiency of the evidence with respect to consent, we necessarily assume for purposes of our decisionas did the Court of Appealsthat the searches were conducted without the informed consent of the patients. We conclude that the judgment should be reversed and the case remanded for a decision on the consent issue. III Because MUSC is a state hospital, the members of its staff are government actors, subject to the strictures of the Fourth Amendment. New Moreover, the urine tests conducted by those staff members were indisputably searches within the meaning of the Fourth Amendment.[9] Neither the District Court nor the Court of Appeals concluded that any of the nine criteria used to identify the women to be searched provided either probable cause to believe that they were using cocaine, or even the basis for a reasonable suspicion of such use. Rather, the District Court and the Court of Appeals viewed the case as one involving MUSC's right *77 to conduct searches without warrants or probable cause.[10] Furthermore, given the posture in which the case comes to us, we must assume for purposes of our decision that the tests were performed without the informed consent of the patients.[11] Because the hospital seeks to justify its authority to conduct drug tests and to turn the results over to law enforcement agents without the knowledge or consent of the patients, this case differs from the four previous cases in which we have considered whether comparable drug tests "fit within the closely guarded category of constitutionally permissible suspicionless searches." In three of those cases, we sustained drug tests for railway employees involved in train accidents, for United States Customs Service employees seeking promotion to certain sensitive positions, Treasury and for high school students participating in interscholastic sports, Vernonia School Dist. In the fourth case, we struck down such testing for candidates for designated state offices as unreasonable. *78 In each of those cases, we employed a balancing test that weighed the intrusion on the individual's interest in privacy against the "special needs" that supported the program. As an initial matter, we note that the invasion of privacy in this case is far more substantial than in those In the previous four cases, there was no misunderstanding about the purpose of the test or the potential use of the test results, and there were protections against the dissemination of the results to third parties.[12] The use of an adverse test result to disqualify one from eligibility for a particular benefit, such as a promotion or an opportunity to participate in an extracurricular activity, involves a less serious intrusion on privacy than the unauthorized dissemination of such results to third parties. The reasonable expectation of privacy enjoyed by the typical patient undergoing diagnostic tests in a hospital is that the results of those tests will not be shared with nonmedical personnel without her consent. See Brief for American Medical Association as Amicus Curiae 11; Brief for American Public Health Association et al. as Amici Curiae 6, 17-19.[13] In none of our prior cases was there any intrusion upon that kind of expectation.[14] *79 The critical difference between those four drug-testing cases and this one, however, lies in the nature of the "special need" asserted as justification for the warrantless searches. In each of those earlier cases, the "special need" that was advanced as a justification for the absence of a warrant or individualized suspicion was one divorced from the State's general interest in law enforcement.[15] This point was emphasized *80 both in the majority opinions sustaining the programs in the first three cases,[16] as well as in the dissent in the case.[17] In this case, however, the central and indispensable feature of the policy from its inception was the use of law enforcement to coerce the patients into substance abuse treatment. This fact distinguishes this case from circumstances in which physicians or psychologists, in the *81 course of ordinary medical procedures aimed at helping the patient herself, come across information that under rules of law or ethics is subject to reporting requirements, which no one has challenged here. See, e. g., Council on Ethical and Judicial Affairs, American Medical Association, PolicyFinder, Current Opinions E-5.05 (requiring reporting where "a patient threatens to inflict serious bodily harm to another person or to him or herself and there is a reasonable probability that the patient may carry out the threat"); ;[18] Respondents argue in essence that their ultimate purposenamely, protecting the health of both mother and childis a beneficent one. In however, we did not simply accept the State's invocation of a "special need." Instead, we carried out a "close review" of the scheme at issue before concluding that the need in question was not "special," as that term has been defined in our In this case, a review of the M-7 policy plainly reveals that the purpose actually served by the MUSC searches "is ultimately indistinguishable from the general interest in crime control." In looking to the programmatic purpose, we consider all the available evidence in order to determine the relevant primary purpose. See, e. g., In this case, as *82 Judge Blake put it in her dissent below, "it is clear from the record that an initial and continuing focus of the policy was on the arrest and prosecution of drug-abusing mothers" Tellingly, the document codifying the policy incorporates the police's operational guidelines. It devotes its attention to the chain of custody, the range of possible criminal charges, and the logistics of police notification and arrests. Nowhere, however, does the document discuss different courses of medical treatment for either mother or infant, aside from treatment for the mother's addiction. Moreover, throughout the development and application of the policy, the Charleston prosecutors and police were extensively involved in the day-to-day administration of the policy. Police and prosecutors decided who would receive the reports of positive drug screens and what information would be included with those reports. App. 78-80, 145-146, 1058-1060. Law enforcement officials also helped determine the procedures to be followed when performing the screens.[19] at 1052-1053. See also In the course of the policy's administration, they had access to Nurse Brown's medical files on the women who tested positive, routinely attended the substance abuse team's meetings, and regularly received copies of team documents discussing the women's progress. Police took pains to coordinate the timing and circumstances of the arrests with MUSC staff, and, in particular, Nurse Brown. While the ultimate goal of the program may well have been to get the women in question into substance abuse treatment *83 and off of drugs, the immediate objective of the searches was to generate evidence for law enforcement purposes[20] in order to reach that goal.[21] The threat of law enforcement *84 may ultimately have been intended as a means to an end, but the direct and primary purpose of MUSC's policy was to ensure the use of those means. In our opinion, this distinction is critical. Because law enforcement involvement always serves some broader social purpose or objective, under respondents' view, virtually any nonconsensual suspicionless search could be immunized under the special needs doctrine by defining the search solely in terms of its ultimate, rather than immediate, purpose.[22] Such an approach is inconsistent with the Fourth Amendment. Given the primary purpose of the Charleston program, which was to use the threat of arrest and prosecution in order to force women into treatment, and given the extensive involvement of law enforcement officials at every stage of the policy, this case simply does not fit within the closely guarded category of "special needs."[23] The fact that positive test results were turned over to the police does not merely provide a basis for distinguishing our prior cases applying the "special needs" balancing approach to the determination of drug use. It also provides an affirmative reason for enforcing the strictures of the Fourth Amendment. While state hospital employees, like other citizens, may have a duty to provide the police with evidence *85 of criminal conduct that they inadvertently acquire in the course of routine treatment, when they undertake to obtain such evidence from their patients for the specific purpose of incriminating those patients, they have a special obligation to make sure that the patients are fully informed about their constitutional rights, as standards of knowing waiver require.[24] Cf. As respondents have repeatedly insisted, their motive was benign rather than punitive. Such a motive, however, cannot justify a departure from Fourth Amendment protections, given the pervasive involvement of law enforcement with the development and application of the MUSC policy. The stark *86 and unique fact that characterizes this case is that Policy M-7 was designed to obtain evidence of criminal conduct by the tested patients that would be turned over to the police and that could be admissible in subsequent criminal prosecutions. While respondents are correct that drug abuse both was and is a serious problem, "the gravity of the threat alone cannot be dispositive of questions concerning what means law enforcement officers may employ to pursue a given purpose." -43. The Fourth Amendment's general prohibition against nonconsensual, warrantless, and suspicionless searches necessarily applies to such a policy. See, e. g., ; Accordingly, the judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings consistent with this opinion. It is so ordered. Justice Kennedy, concurring in the judgment. |
Justice White | majority | false | Kern County Land Co. v. Occidental Petroleum Corp. | 1973-05-07T00:00:00 | null | https://www.courtlistener.com/opinion/108776/kern-county-land-co-v-occidental-petroleum-corp/ | https://www.courtlistener.com/api/rest/v3/clusters/108776/ | 1,973 | 1972-107 | 1 | 6 | 3 | Section 16 (b) of the Securities Exchange Act of 1934, 48 Stat. 896, 15 U.S. C. § 78p (b),[1] provides that officers, *584 directors, and holders of more than 10% of the listed stock of any company shall be liable to the company for any profits realized from any purchase and sale or sale and purchase of such stock occurring within a period of six months. Unquestionably, one or more statutory purchases occur when one company, seeking to gain control of another, acquires more than 10% of the stock of the latter through a tender offer made to its shareholders. But is it a § 16 (b) "sale" when the target of the tender offer defends itself by merging into a third company and the tender offeror then exchanges his stock for the stock of the surviving company and also grants an option to purchase the latter stock that is not exercisable within the statutory six-month period? This is the question before us in this case.
I
On May 8, 1967, after unsuccessfully seeking to merge with Kern County Land Co. (Old Kern),[2] Occidental Petroleum Corp. (Occidental)[3] announced an offer, to expire on June 8, 1967, to purchase on a first-come, first-served basis 500,000 shares of Old Kern common stock[4] at a price of $83.50 per share plus a brokerage *585 commission of $1.50 per share.[5] By May 10, 1967, 500,000 shares, more than 10% of the outstanding shares of Old Kern,[6] had been tendered. On May 11, Occidental extended its offer to encompass an additional 500,000 shares. At the close of the tender offer, on June 8, 1967, Occidental owned 887,549 shares of Old Kern.[7]
Immediately upon the announcement of Occidental's tender offer, the Old Kern management undertook to frustrate Occidental's takeover attempt. A management letter to all stockholders cautioned against tender and indicated that Occidental's offer might not be the best available, since the management was engaged in merger discussions with several companies. When Occidental extended its tender offer, the president of Old Kern sent a telegram to all stockholders again advising against tender. In addition, Old Kern undertook merger discussions *586 with Tenneco, Inc. (Tenneco),[8] and, on May 19, 1967, the Board of Directors of Old Kern announced that it had approved a merger proposal advanced by Tenneco.[9] Under the terms of the merger, Tenneco would acquire the assets, property, and goodwill of Old Kern, subject to its liabilities, through "Kern County Land Co." (New Kern),[10] a new corporation to be formed by Tenneco to receive the assets and carry on the business of Old Kern. The shareholders of Old Kern would receive a share of Tenneco cumulative convertible preference stock in exchange for each share of Old Kern common stock which they owned. On the same day, May 19, Occidental, in a quarterly report to stockholders, appraised the value of the new Tenneco stock at $105 per share.[11]
*587 Occidental, seeing its tender offer and takeover attempt being blocked by the Old Kern-Tenneco "defensive" merger, countered on May 25 and 31 with two mandamus actions in the California courts seeking to obtain extensive inspection of Old Kern books and records.[12] Realizing that, if the Old Kern-Tenneco merger were approved and successfully closed, Occidental would have to exchange its Old Kern shares for Tenneco stock and would be locked into a minority position in Tenneco, Occidental took other steps to protect itself. Between May 30 and June 2, it negotiated an arrangement with Tenneco whereby Occidental granted Tenneco Corp., a subsidiary of Tenneco, an option to purchase at $105 per share all of the Tenneco preference stock to which Occidental would be entitled in exchange for its Old Kern stock when and if the Old Kern-Tenneco merger was closed.[13] The premium to secure the option, at $10 per share, totaled $8,866,230 and was to be paid immediately upon the signing of the option agreement.[14] If the option were exercised, the premium was to be applied to the purchase price. By the terms of the option agreement, the option could not be exercised prior to December *588 9, 1967, a date six months and one day after expiration of Occidental's tender offer. On June 2, 1967, within six months of the acquisition by Occidental of more than 10% ownership of Old Kern, Occidental and Tenneco Corp. executed the option.[15] Soon thereafter, Occidental announced that it would not oppose the Old Kern-Tenneco merger and dismissed its state court suits against Old Kern.[16]
The Old Kern-Tenneco merger plan was presented to and approved by Old Kern shareholders at their meeting on July 17, 1967. Occidental refrained from voting its Old Kern shares, but in a letter read at the meeting Occidental stated that it had determined prior to June 2 not to oppose the merger and that it did not consider the plan unfair or inequitable.[17] Indeed, Occidental indicated that, had it been voting, it would have voted in favor of the merger.
Meanwhile, the Securities and Exchange Commission had refused Occidental's request to exempt from possible § 16 (b) liability Occidental's exchange of its Old Kern stock for the Tenneco preference shares that would take *589 place when and if the merger transaction were closed. Various Old Kern stockholders, with Occidental's interests in mind, thereupon sought to delay consummation of the merger by instituting various lawsuits in the state and federal courts.[18] These attempts were unsuccessful, however, and preparations for the merger neared completion with an Internal Revenue Service ruling that consummation of the plan would result in a tax-free exchange with no taxable gain or loss to Old Kern shareholders, and with the issuance of the necessary approval of the merger closing by the California Commissioner of Corporations.
The Old Kern-Tenneco merger transaction was closed on August 30. Old Kern shareholders thereupon became irrevocably entitled to receive Tenneco preference stock, share for share in exchange for their Old Kern stock. Old Kern was dissolved and all of its assets, including "all claims, demands, rights and chooses in action accrued or to accrue under and by virtue of the Securities Exchange Act of 1934 . . . ," were transferred to New Kern.
The option granted by Occidental on June 2, 1967, was exercised on December 11, 1967. Occidental, not having previously availed itself of its right, exchanged certificates representing 887,549 shares of Old Kern stock for a certificate representing a like number of shares of Tenneco preference stock. The certificate was then endorsed over to the optionee-purchaser, and in return $84,229,185 was credited to Occidental's accounts at various banks. Adding to this amount the $8,886,230 premium paid in June, Occidental received $93,905,415 for its Old Kern stock (including the 1,900 shares acquired prior to issuance of its tender offer). In addition, Occidental received dividends totaling $1,793,439.22. Occidental's *590 total profit was $19,506,419.22 on the shares obtained through its tender offer.
On October 17, 1967, New Kern instituted a suit under § 16 (b) against Occidental to recover the profits which Occidental had realized as a result of its dealings in Old Kern stock. The complaint alleged that the execution of the Occidental-Tenneco option on June 2, 1967, and the exchange of Old Kern shares for shares of Tenneco to which Occidental became entitled pursuant to the merger closed on August 30, 1967, were both "sales" within the coverage of § 16 (b). Since both acts took place within six months of the date on which Occidental became the owner of more than 10% of the stock of Old Kern, New Kern asserted that § 16 (b) required surrender of the profits realized by Occidental.[19] New Kern eventually moved for summary judgment, and, on December 27, 1970, the District Court granted summary judgment in favor of New Kern. Abrams v. Occidental Petroleum Corp., 323 F. Supp. 570 (SDNY 1970). The District Court held that the execution of the option on June 2, 1967, and the exchange of Old Kern shares for shares of Tenneco on August 30, 1967, were "sales" under § 16 (b). The Court ordered Occidental to disgorge its profits plus interest. In a supplemental opinion, Occidental was also ordered to refund the dividends which it had received plus interest.
On appeal, the Court of Appeals reversed and ordered summary judgment entered in favor of Occidental. Abrams v. Occidental Petroleum Corp., 450 F.2d 157 (CA2 1971). The Court held that neither the option nor the exchange constituted a "sale" within the purview of *591 § 16 (b).[20] We granted certiorari. 405 U.S. 1064 (1972). We affirm.
II
Section 16 (b) provides, inter alia, that a statutory insider[21] must surrender to the issuing corporation "any profit realized by him from any purchase and sale, or any sale and purchase, of any equity security[22] of such issuer . . . within any period of less than six months." As specified in its introductory clause, § 16 (b) was enacted "[f]or the purpose of preventing the unfair use of information which may have been obtained by [a statutory insider] . . . by reason of his relationship to the issuer." Congress recognized that short-swing speculation by stockholders with advance, inside information would threaten the goal of the Securities Exchange Act to "insure the maintenance of fair and honest markets." *592 15 U.S. C. § 78b. Insiders could exploit information not generally available to others to secure quick profits. As we have noted, "the only method Congress deemed effective to curb the evils of insider trading was a flat rule taking the profits out of a class of transactions in which the possibility of abuse was believed to be intolerably great." Reliance Electric Co. v. Emerson Electric Co., 404 U.S. 418, 422 (1972). As stated in the report of the Senate Committee, the bill aimed at protecting the public "by preventing directors, officers, and principal stockholders of a corporation . . . from speculating in the stock on the basis of information not available to others." S. Rep. No. 792, 73d Cong., 2d Sess., 9 (1934).[23]
*593 Although traditional cash-for-stock transactions that result in a purchase and sale or a sale and purchase within the six-month, statutory period are clearly within the purview of § 16 (b), the courts have wrestled with the question of inclusion or exclusion of certain "unorthodox" transactions.[24] The statutory definitions of "purchase" *594 and "sale" are broad and, at least arguably, reach many transactions not ordinarily deemed a sale or purchase.[25] In deciding whether borderline transactions are within the reach of the statute, the courts have come to inquire whether the transaction may serve as a vehicle for the evil which Congress sought to preventthe realization of short-swing profits based upon access to inside information[26]thereby endeavoring to implement congressional *595 objectives without extending the reach of the statute beyond its intended limits. The statute requires the inside, short-swing trader to disgorge all profits realized on all "purchases" and "sales" within the specified time period, without proof of actual abuse of insider information, and without proof of intent to profit on the basis of such information. Under these strict terms, the prevailing view is to apply the statute only when its application would serve its goals. "[W]here alternative constructions of the terms of § 16 (b) are possible, those terms are to be given the construction that best serves the congressional purpose of curbing short-swing speculation by corporate insiders." Reliance Electric Co. v. Emerson Electric Co., 404 U. S., at 424. See Blau v. Lamb, 363 F.2d 507 (CA2 1966), cert. denied, 385 U.S. 1002 (1967). Thus, "[i]n interpreting the terms `purchase' and `sale,' courts have properly asked whether the particular type of transaction involved is one that gives rise to speculative abuse." Reliance Electric Co. v. Emerson Electric Co., supra, at 424 n. 4.[27]
In the present case, it is undisputed that Occidental became a "beneficial owner" within the terms of § 16 (b) when, pursuant to its tender offer, it "purchased" more than 10% of the outstanding shares of Old Kern. We must decide, however, whether a "sale" within the ambit of the statute took place either when Occidental became irrevocably bound to exchange its shares of Old Kern for shares of Tenneco pursuant to the terms of the merger agreement between Old Kern and Tenneco or *596 when Occidental gave an option to Tenneco to purchase from Occidental the Tenneco shares so acquired.[28]
III
On August 30, 1967, the Old Kern-Tenneco merger agreement was signed, and Occidental became irrevocably entitled to exchange its shares of Old Kern stock for shares of Tenneco preference stock. Concededly, the transaction must be viewed as though Occidental had made the exchange on that day. But, even so, did the exchange involve a "sale" of Old Kern shares within the meaning of § 16 (b)? We agree with the Court of Appeals that it did not, for we think it totally unrealistic to assume or infer from the facts before us that Occidental either had or was likely to have access to inside information, by reason of its ownership of more than 10% of the outstanding shares of Old Kern, so as to afford it an opportunity to reap speculative, short-swing profits from its disposition within six months of its tender-offer purchases.
It cannot be contended that Occidental was an insider when, on May 8, 1967, it made an irrevocable offer to purchase 500,000 shares of Old Kern stock at a price substantially above market. At that time, it owned only 1,900 shares of Old Kern stock, far fewer than the 432,000 shares needed to constitute the 10% ownership required by the statute. There is no basis for finding *597 that, at the time the tender offer was commenced, Occidental enjoyed an insider's opportunity to acquire information about Old Kern's affairs.
It is also wide of the mark to assert that Occidental, as a sophisticated corporation knowledgeable in matters of corporate affairs and finance, knew that its tender offer would either succeed or would be met with a "defensive merger." If its takeover efforts failed, it is argued, Occidental knew it could sell its stock to the target company's merger partner at a substantial profit. Calculations of this sort, however, whether speculative or not and whether fair or unfair to other stockholders or to Old Kern, do not represent the kind of speculative abuse at which the statute is aimed, for they could not have been based on inside information obtained from substantial stockholdings that did not yet exist. Accepting both that Occidental made this very prediction and that it would recurringly be an accurate forecast in tender-offer situations,[29] we nevertheless fail to perceive how the fruition of such anticipated events would require, or in any way depend upon, the receipt and use of inside information. If there are evils to be redressed by way of deterring those who would make tender offers, *598 § 16 (b) does not appear to us to have been designed for this task.
By May 10, 1967, Occidental had acquired more than 10% of the outstanding shares of Old Kern. It was thus a statutory insider when, on May 11, it extended its tender offer to include another 500,000 shares. We are quite unconvinced, however, that the situation had changed materially with respect to the possibilities of speculative abuse of inside information by Occidental. Perhaps Occidental anticipated that extending its offer would increase the likelihood of the ultimate success of its takeover attempt or the occurrence of a defensive merger. But, again, the expectation of such benefits was unrelated to the use of information unavailable to other stockholders or members of the public with sufficient funds and the intention to make the purchases Occidental had offered to make before June 8, 1967.
The possibility that Occidental had, or had the opportunity to have, any confidential information about Old Kern before or after May 11, 1967, seems extremely remote. Occidental was, after all, a tender offeror, threatening to seize control of Old Kern, displace its management, and use the company for its own ends. The Old Kern management vigorously and immediately opposed Occidental's efforts. Twice it communicated with its stockholders, advising against acceptance of Occidental's offer and indicating prior to May 11 and prior to Occidental's extension of its offer, that there was a possibility of an imminent merger and a more profitable exchange. Old Kern's management refused to discuss with Occidental officials the subject of an Old Kern-Occidental merger. Instead, it undertook negotiations with Tenneco and forthwith concluded an agreement, announcing the merger terms on May 19. Requests by Occidental for inspection of Old Kern records were sufficiently frustrated *599 by Old Kern's management to force Occidental to litigate to secure the information it desired.
There is, therefore, nothing in connection with Occidental's acquisition of Old Kern stock pursuant to its tender offer to indicate either the possibility of inside information being available to Occidental by virtue of its stock ownership or the potential for speculative abuse of such inside information by Occidental. Much the same can be said of the events leading to the exchange of Occidental's Old Kern stock for Tenneco preferred, which is one of the transactions that is sought to be classified a "sale" under § 16 (b). The critical fact is that the exchange took place and was required pursuant to a merger between Old Kern and Tenneco. That merger was not engineered by Occidental but was sought by Old Kern to frustrate the attempts of Occidental to gain control of Old Kern. Occidental obviously did not participate in or control the negotiations or the agreement between Old Kern and Tenneco. Cf. Newmark v. RKO General, 425 F.2d 348 (CA2), cert. denied, 400 U.S. 854 (1970); Park & Tilford v. Schulte, 160 F.2d 984 (CA2), cert. denied, 332 U.S. 761 (1947). Once agreement between those two companies crystallized, the course of subsequent events was out of Occidental's hands. Old Kern needed the consent of its stockholders, but as it turned out, Old Kern's management had the necessary votes without the affirmative vote of Occidental. The merger agreement was approved by a majority of the stockholders of Old Kern, excluding the votes to which Occidental was entitled by virtue of its ownership of Old Kern shares. See generally Ferraiolo v. Newman, 259 F.2d 342 (CA6 1958), cert. denied, 359 U.S. 927 (1959); Roberts v. Eaton, 212 F.2d 82 (CA2 1954). Occidental, although registering its opinion that the merger would be beneficial to Old Kern shareholders, did not in fact vote at the *600 stockholders' meeting at which merger approval was obtained. Under California law, its abstention was tantamount to a vote against approval of the merger. Moreover, at the time of stockholder ratification of the merger, Occidental's previous dealing in Old Kern stock was, as it had always been, fully disclosed.
Once the merger and exchange were approved, Occidental was left with no real choice with respect to the future of its shares of Old Kern. Occidental was in no position to prevent the issuance of a ruling by the Internal Revenue Service that the exchange of Old Kern stock for Tenneco preferred would be tax free; and, although various lawsuits were begun in state and federal courts seeking to postpone the merger closing beyond the statutory six-month period, those efforts were futile. The California Corporation Commissioner issued the necessary permits for the closing that took place on August 30, 1967. The merger left no right in dissenters to secure appraisal of their stock. Occidental could, of course, have disposed of its shares of Old Kern for cash before the merger was closed. Such an act would have been a § 16 (b) sale and would have left Occidental with a prima facie § 16 (b) liability. It was not, therefore, a realistic alternative for Occidental as long as it felt that it could successfully defend a suit like the present one. See generally Petteys v. Butler, 367 F.2d 528 (CA8 1966), cert. denied, 385 U.S. 1006 (1967); Ferraiolo v. Newman, supra; Lynam v. Livingston, 276 F. Supp. 104 (Del. 1967); Blau v. Hodgkinson, 100 F. Supp. 361 (SDNY 1951). We do not suggest that an exchange of stock pursuant to a merger may never result in § 16 (b) liability. But the involuntary nature of Occidental's exchange, when coupled with the absence of the possibility of speculative abuse of inside information, convinces us that § 16 (b) should not apply to transactions such as this one.
*601 IV
Petitioner also claims that the Occidental-Tenneco option agreement should itself be considered a sale, either because it was the kind of transaction the statute was designed to prevent or because the agreement was an option in form but a sale in fact. But the mere execution of an option to sell is not generally regarded as a "sale." See Booth v. Varian Associates, 334 F.2d 1 (CA1 1964), cert. denied, 379 U.S. 961 (1965); Allis-Chalmers Mfg. Co. v. Gulf & Western Industries, 309 F. Supp. 75 (ED Wis. 1970); Marquette Cement Mfg. Co. v. Andreas, 239 F. Supp. 962 (SDNY 1965). And we do not find in the execution of the Occidental-Tenneco option agreement a sufficient possibility for the speculative abuse of inside information with respect to Old Kern's affairs to warrant holding that the option agreement was itself a "sale" within the meaning of § 16 (b). The mutual advantages of the arrangement appear quite clear. As the District Court found, Occidental wanted to avoid the position of a minority stockholder with a huge investment in a company over which it had no control and in which it had not chosen to invest. On the other hand, Tenneco did not want a potentially troublesome minority stockholder that had just been vanquished in a fight for the control of Old Kern. Motivations like these do not smack of insider trading; and it is not clear to us, as it was not to the Court of Appeals, how the negotiation and execution of the option agreement gave Occidental any possible opportunity to trade on inside information it might have obtained from its position as a major stockholder of Old Kern. Occidental wanted to get out, but only at a date more than six months thence. It was willing to get out at a price of $105 per share, a price at which it had publicly valued Tenneco preferred on May 19 when the Tenneco-Old Kern agreement was announced. *602 In any event, Occidental was dealing with the putative new owners of Old Kern, who undoubtedly knew more about Old Kern and Tenneco's affairs than did Occidental. If Occidental had leverage in dealing with Tenneco, it is incredible that its source was inside information rather than the fact of its large stock ownership itself.
Neither does it appear that the option agreement, as drafted and executed by the parties, offered measurable possibilities for speculative abuse. What Occidental granted was a "call" option. Tenneco had the right to buy after six months, but Occidental could not force Tenneco to buy. The price was fixed at $105 for each share of Tenneco preferred. Occidental could not share in a rising market for the Tenneco stock See Silverman v. Landa, 306 F.2d 422 (CA2 1962). If the stock fell more than $10 per share, the option might not be exercised, and Occidental might suffer a loss if the market further deteriorated to a point where Occidental was forced to sell. Thus, the option, by its very form, left Occidental with no choice but to sell if Tenneco exercised the option, which it was almost sure to do if the value of Tenneco stock remained relatively steady. On the other hand, it is difficult to perceive any speculative value to Occidental if the stock declined and Tenneco chose not to exercise its option. See generally Note, Put and Call Options Under Section 16 of the Securities Exchange Act, 69 Yale L. J. 868 (1960); H. Filer, Understanding Put and Call Options 96-111 (1959); G. Leffler, The Stock Market 363-378 (2d ed. 1957).
The option, therefore, does not appear to have been an instrument with potential for speculative abuse, whether or not Occidental possessed inside information about the affairs of Old Kern. In addition, the option covered Tenneco preference stock, a stock as yet unissued, unregistered, and untraded. It was the value of this *603 stock that underlay the option and that determined whether the option would be exercised, whether Occidental would be able to profit from the exercise, and whether there was any real likelihood of the exploitation of inside information. If Occidental had inside information when it negotiated and signed the option agreement, it was inside information with respect to Old Kern. Whatever it may have known or expected as to the future value of Old Kern stock, Occidental had no ownership position in Tenneco giving it any actual or presumed insights into the future value of Tenneco stock. That was the critical item of intelligence if Occidental was to use the option for purposes of speculation. Also, the date for exercise of the option was over six months in the future, a period that, under the statute itself, is assumed to dissipate whatever trading advantage might be imputed to a major stockholder with inside information. See Comment, Stock Exchanges Pursuant to Corporate Consolidation: A Section 16 (b) "Purchase or Sale?," 117 U. Pa. L. Rev. 1034, 1054 (1969); Silverman v. Landa, supra. By enshrining the statutory period into the option. Occidental also, at least if the statutory period is taken to accomplish its intended purpose, limited its speculative possibilities. Nor should it be forgotten that there was no absolute assurance that the merger, which was not controlled by Occidental, would be consummated. In the event the merger did not close, the option itself would become null and void.
Nor can we agree that we must reverse the Court of Appeals on the ground that the option agreement was in fact a sale because the premium paid was so large as to make the exercise of the option almost inevitable, particularly when coupled with Tenneco's desire to rid itself of a potentially troublesome stockholder. The argument has force, but resolution of the question is very much a matter of judgment, economic and otherwise, and the *604 Court of Appeals rejected the argument. That court emphasized that the premium paid was what experts had said the option was worth, the possibility that the market might drop sufficiently in the six months following execution of the option to make exercise unlikely, and the fact that here, unlike the situation in Bershad v. McDonough, 428 F.2d 693 (CA7 1970), the optionor did not surrender practically all emoluments of ownership by executing the option. Nor did any other special circumstances indicate that the parties understood and intended that the option was in fact a sale.[30] We see no satisfactory basis or reason for disagreeing with the judgment of the Court of Appeals in this respect.[31]
The judgment of the Court of Appeals is affirmed.
So ordered.
*605 MR. JUSTICE DOUGLAS, with whom MR. JUSTICE BRENNAN and MR. | Section 16 (b) of the Securities Exchange Act of 1934, 15 U.S. C. 78p (b),[1] provides that officers, *584 directors, and holders of more than 10% of the listed stock of any company shall be liable to the company for any profits realized from any purchase and sale or sale and purchase of such stock occurring within a period of six months. Unquestionably, one or more statutory purchases occur when one company, seeking to gain control of another, acquires more than 10% of the stock of the latter through a tender offer made to its shareholders. But is it a 16 (b) "sale" when the target of the tender offer defends itself by merging into a third company and the tender offeror then exchanges his stock for the stock of the surviving company and also grants an option to purchase the latter stock that is not exercisable within the statutory six-month period? This is the question before us in this case. I On May 8, 1967, after unsuccessfully seeking to merge with Kern County Land (Old Kern),[2] Occidental Petroleum Corp. (Occidental)[3] announced an offer, to expire on June 8, 1967, to purchase on a first-come, first-served basis 500,000 shares of Old Kern common stock[4] at a price of $83.50 per share plus a brokerage *585 commission of $1.50 per share.[5] By May 10, 1967, 500,000 shares, more than 10% of the outstanding shares of Old Kern,[6] had been tendered. On May 11, Occidental extended its offer to encompass an additional 500,000 shares. At the close of the tender offer, on June 8, 1967, Occidental owned 887,549 shares of Old Kern.[7] Immediately upon the announcement of Occidental's tender offer, the Old Kern management undertook to frustrate Occidental's takeover attempt. A management letter to all stockholders cautioned against tender and indicated that Occidental's offer might not be the best available, since the management was engaged in merger discussions with several companies. When Occidental extended its tender offer, the president of Old Kern sent a telegram to all stockholders again advising against tender. In addition, Old Kern undertook merger discussions *586 with Tenneco, Inc. (Tenneco),[8] and, on May 19, 1967, the Board of Directors of Old Kern announced that it had approved a merger proposal advanced by Tenneco.[9] Under the terms of the merger, Tenneco would acquire the assets, property, and goodwill of Old Kern, subject to its liabilities, through "Kern County Land " (New Kern),[10] a new corporation to be formed by Tenneco to receive the assets and carry on the business of Old Kern. The shareholders of Old Kern would receive a share of Tenneco cumulative convertible preference stock in exchange for each share of Old Kern common stock which they owned. On the same day, May 19, Occidental, in a quarterly report to stockholders, appraised the value of the new Tenneco stock at $105 per share.[11] *587 Occidental, seeing its tender offer and takeover attempt being blocked by the Old Kern-Tenneco "defensive" merger, countered on May 25 and 31 with two mandamus actions in the California courts seeking to obtain extensive inspection of Old Kern books and records.[12] Realizing that, if the Old Kern-Tenneco merger were approved and successfully closed, Occidental would have to exchange its Old Kern shares for Tenneco stock and would be locked into a minority position in Tenneco, Occidental took other steps to protect itself. Between May 30 and June 2, it negotiated an arrangement with Tenneco whereby Occidental granted Tenneco Corp., a subsidiary of Tenneco, an option to purchase at $105 per share all of the Tenneco preference stock to which Occidental would be entitled in exchange for its Old Kern stock when and if the Old Kern-Tenneco merger was closed.[13] The premium to secure the option, at $10 per share, totaled $8,866,230 and was to be paid immediately upon the signing of the option agreement.[14] If the option were exercised, the premium was to be applied to the purchase price. By the terms of the option agreement, the option could not be exercised prior to December *588 9, 1967, a date six months and one day after expiration of Occidental's tender offer. On June 2, 1967, within six months of the acquisition by Occidental of more than 10% ownership of Old Kern, Occidental and Tenneco Corp. executed the option.[15] Soon thereafter, Occidental announced that it would not oppose the Old Kern-Tenneco merger and dismissed its state court suits against Old Kern.[16] The Old Kern-Tenneco merger plan was presented to and approved by Old Kern shareholders at their meeting on July 17, 1967. Occidental refrained from voting its Old Kern shares, but in a letter read at the meeting Occidental stated that it had determined prior to June 2 not to oppose the merger and that it did not consider the plan unfair or inequitable.[17] Indeed, Occidental indicated that, had it been voting, it would have voted in favor of the merger. Meanwhile, the Securities and Exchange Commission had refused Occidental's request to exempt from possible 16 (b) liability Occidental's exchange of its Old Kern stock for the Tenneco preference shares that would take *589 place when and if the merger transaction were closed. Various Old Kern stockholders, with Occidental's interests in mind, thereupon sought to delay consummation of the merger by instituting various lawsuits in the state and federal courts.[18] These attempts were unsuccessful, however, and preparations for the merger neared completion with an Internal Revenue Service ruling that consummation of the plan would result in a tax-free exchange with no taxable gain or loss to Old Kern shareholders, and with the issuance of the necessary approval of the merger closing by the California Commissioner of Corporations. The Old Kern-Tenneco merger transaction was closed on August 30. Old Kern shareholders thereupon became irrevocably entitled to receive Tenneco preference stock, share for share in exchange for their Old Kern stock. Old Kern was dissolved and all of its assets, including "all claims, demands, rights and chooses in action accrued or to accrue under and by virtue of the Securities Exchange Act of 1934" were transferred to New Kern. The option granted by Occidental on June 2, 1967, was exercised on December 11, 1967. Occidental, not having previously availed itself of its right, exchanged certificates representing 887,549 shares of Old Kern stock for a certificate representing a like number of shares of Tenneco preference stock. The certificate was then endorsed over to the optionee-purchaser, and in return $84,229,185 was credited to Occidental's accounts at various banks. Adding to this amount the $8,886,230 premium paid in June, Occidental received $93,905,415 for its Old Kern stock (including the 1,900 shares acquired prior to issuance of its tender offer). In addition, Occidental received dividends totaling $1,793,439.22. Occidental's *590 total profit was $19,506,419.22 on the shares obtained through its tender offer. On October 17, 1967, New Kern instituted a suit under 16 (b) against Occidental to recover the profits which Occidental had realized as a result of its dealings in Old Kern stock. The complaint alleged that the execution of the Occidental-Tenneco option on June 2, 1967, and the exchange of Old Kern shares for shares of Tenneco to which Occidental became entitled pursuant to the merger closed on August 30, 1967, were both "sales" within the coverage of 16 (b). Since both acts took place within six months of the date on which Occidental became the owner of more than 10% of the stock of Old Kern, New Kern asserted that 16 (b) required surrender of the profits realized by Occidental.[19] New Kern eventually moved for summary judgment, and, on December 27, the District Court granted summary judgment in favor of New Kern. The District Court held that the execution of the option on June 2, 1967, and the exchange of Old Kern shares for shares of Tenneco on August 30, 1967, were "sales" under 16 (b). The Court ordered Occidental to disgorge its profits plus interest. In a supplemental opinion, Occidental was also ordered to refund the dividends which it had received plus interest. On appeal, the Court of Appeals reversed and ordered summary judgment entered in favor of Occidental. The Court held that neither the option nor the exchange constituted a "sale" within the purview of *591 16 (b).[20] We granted certiorari. We affirm. II Section 16 (b) provides, inter alia, that a statutory insider[21] must surrender to the issuing corporation "any profit realized by him from any purchase and sale, or any sale and purchase, of any equity security[22] of such issuer within any period of less than six months." As specified in its introductory clause, 16 (b) was enacted "[f]or the purpose of preventing the unfair use of information which may have been obtained by [a statutory insider] by reason of his relationship to the issuer." Congress recognized that short-swing speculation by stockholders with advance, inside information would threaten the goal of the Securities Exchange Act to "insure the maintenance of fair and honest markets." *592 15 U.S. C. 78b. Insiders could exploit information not generally available to others to secure quick profits. As we have noted, "the only method Congress deemed effective to curb the evils of insider trading was a flat rule taking the profits out of a class of transactions in which the possibility of abuse was believed to be intolerably great." Reliance Electric As stated in the report of the Senate Committee, the bill aimed at protecting the public "by preventing directors, officers, and principal stockholders of a corporation from speculating in the stock on the basis of information not available to others." S. Rep. No. 792, 73d Cong., 2d Sess., 9 (1934).[23] *593 Although traditional cash-for-stock transactions that result in a purchase and sale or a sale and purchase within the six-month, statutory period are clearly within the purview of 16 (b), the courts have wrestled with the question of inclusion or exclusion of certain "unorthodox" transactions.[24] The statutory definitions of "purchase" *594 and "sale" are broad and, at least arguably, reach many transactions not ordinarily deemed a sale or purchase.[25] In deciding whether borderline transactions are within the reach of the statute, the courts have come to inquire whether the transaction may serve as a vehicle for the evil which Congress sought to preventthe realization of short-swing profits based upon access to inside information[26]thereby endeavoring to implement congressional *595 objectives without extending the reach of the statute beyond its intended limits. The statute requires the inside, short-swing trader to disgorge all profits realized on all "purchases" and "sales" within the specified time period, without proof of actual abuse of insider information, and without proof of intent to profit on the basis of such information. Under these strict terms, the prevailing view is to apply the statute only when its application would serve its goals. "[W]here alternative constructions of the terms of 16 (b) are possible, those terms are to be given the construction that best serves the congressional purpose of curbing short-swing speculation by corporate insiders." Reliance Electric See cert. denied, Thus, "[i]n interpreting the terms `purchase' and `sale,' courts have properly asked whether the particular type of transaction involved is one that gives rise to speculative abuse." Reliance Electric at 424 n. 4.[27] In the present case, it is undisputed that Occidental became a "beneficial owner" within the terms of 16 (b) when, pursuant to its tender offer, it "purchased" more than 10% of the outstanding shares of Old Kern. We must decide, however, whether a "sale" within the ambit of the statute took place either when Occidental became irrevocably bound to exchange its shares of Old Kern for shares of Tenneco pursuant to the terms of the merger agreement between Old Kern and Tenneco or *596 when Occidental gave an option to Tenneco to purchase from Occidental the Tenneco shares so acquired.[28] III On August 30, 1967, the Old Kern-Tenneco merger agreement was signed, and Occidental became irrevocably entitled to exchange its shares of Old Kern stock for shares of Tenneco preference stock. Concededly, the transaction must be viewed as though Occidental had made the exchange on that day. But, even so, did the exchange involve a "sale" of Old Kern shares within the meaning of 16 (b)? We agree with the Court of Appeals that it did not, for we think it totally unrealistic to assume or infer from the facts before us that Occidental either had or was likely to have access to inside information, by reason of its ownership of more than 10% of the outstanding shares of Old Kern, so as to afford it an opportunity to reap speculative, short-swing profits from its disposition within six months of its tender-offer purchases. It cannot be contended that Occidental was an insider when, on May 8, 1967, it made an irrevocable offer to purchase 500,000 shares of Old Kern stock at a price substantially above market. At that time, it owned only 1,900 shares of Old Kern stock, far fewer than the 432,000 shares needed to constitute the 10% ownership required by the statute. There is no basis for finding *597 that, at the time the tender offer was commenced, Occidental enjoyed an insider's opportunity to acquire information about Old Kern's affairs. It is also wide of the mark to assert that Occidental, as a sophisticated corporation knowledgeable in matters of corporate affairs and finance, knew that its tender offer would either succeed or would be met with a "defensive merger." If its takeover efforts failed, it is argued, Occidental knew it could sell its stock to the target company's merger partner at a substantial profit. Calculations of this sort, however, whether speculative or not and whether fair or unfair to other stockholders or to Old Kern, do not represent the kind of speculative abuse at which the statute is aimed, for they could not have been based on inside information obtained from substantial stockholdings that did not yet exist. Accepting both that Occidental made this very prediction and that it would recurringly be an accurate forecast in tender-offer situations,[29] we nevertheless fail to perceive how the fruition of such anticipated events would require, or in any way depend upon, the receipt and use of inside information. If there are evils to be redressed by way of deterring those who would make tender offers, *598 16 (b) does not appear to us to have been designed for this task. By May 10, 1967, Occidental had acquired more than 10% of the outstanding shares of Old Kern. It was thus a statutory insider when, on May 11, it extended its tender offer to include another 500,000 shares. We are quite unconvinced, however, that the situation had changed materially with respect to the possibilities of speculative abuse of inside information by Occidental. Perhaps Occidental anticipated that extending its offer would increase the likelihood of the ultimate success of its takeover attempt or the occurrence of a defensive merger. But, again, the expectation of such benefits was unrelated to the use of information unavailable to other stockholders or members of the public with sufficient funds and the intention to make the purchases Occidental had offered to make before June 8, 1967. The possibility that Occidental had, or had the opportunity to have, any confidential information about Old Kern before or after May 11, 1967, seems extremely remote. Occidental was, after all, a tender offeror, threatening to seize control of Old Kern, displace its management, and use the company for its own ends. The Old Kern management vigorously and immediately opposed Occidental's efforts. Twice it communicated with its stockholders, advising against acceptance of Occidental's offer and indicating prior to May 11 and prior to Occidental's extension of its offer, that there was a possibility of an imminent merger and a more profitable exchange. Old Kern's management refused to discuss with Occidental officials the subject of an Old Kern-Occidental merger. Instead, it undertook negotiations with Tenneco and forthwith concluded an agreement, announcing the merger terms on May 19. Requests by Occidental for inspection of Old Kern records were sufficiently frustrated *599 by Old Kern's management to force Occidental to litigate to secure the information it desired. There is, therefore, nothing in connection with Occidental's acquisition of Old Kern stock pursuant to its tender offer to indicate either the possibility of inside information being available to Occidental by virtue of its stock ownership or the potential for speculative abuse of such inside information by Occidental. Much the same can be said of the events leading to the exchange of Occidental's Old Kern stock for Tenneco preferred, which is one of the transactions that is sought to be classified a "sale" under 16 (b). The critical fact is that the exchange took place and was required pursuant to a merger between Old Kern and Tenneco. That merger was not engineered by Occidental but was sought by Old Kern to frustrate the attempts of Occidental to gain control of Old Kern. Occidental obviously did not participate in or control the negotiations or the agreement between Old Kern and Tenneco. Cf. (CA2), cert. denied, ; Park & (CA2), cert. denied, Once agreement between those two companies crystallized, the course of subsequent events was out of Occidental's hands. Old Kern needed the consent of its stockholders, but as it turned out, Old Kern's management had the necessary votes without the affirmative vote of Occidental. The merger agreement was approved by a majority of the stockholders of Old Kern, excluding the votes to which Occidental was entitled by virtue of its ownership of Old Kern shares. See generally cert. denied, ; Occidental, although registering its opinion that the merger would be beneficial to Old Kern shareholders, did not in fact vote at the *600 stockholders' meeting at which merger approval was obtained. Under California law, its abstention was tantamount to a vote against approval of the merger. Moreover, at the time of stockholder ratification of the merger, Occidental's previous dealing in Old Kern stock was, as it had always been, fully disclosed. Once the merger and exchange were approved, Occidental was left with no real choice with respect to the future of its shares of Old Kern. Occidental was in no position to prevent the issuance of a ruling by the Internal Revenue Service that the exchange of Old Kern stock for Tenneco preferred would be tax free; and, although various lawsuits were begun in state and federal courts seeking to postpone the merger closing beyond the statutory six-month period, those efforts were futile. The California Corporation Commissioner issued the necessary permits for the closing that took place on August 30, 1967. The merger left no right in dissenters to secure appraisal of their stock. Occidental could, of course, have disposed of its shares of Old Kern for cash before the merger was closed. Such an act would have been a 16 (b) sale and would have left Occidental with a prima facie 16 (b) liability. It was not, therefore, a realistic alternative for Occidental as long as it felt that it could successfully defend a suit like the present one. See generally cert. denied, ; ; We do not suggest that an exchange of stock pursuant to a merger may never result in 16 (b) liability. But the involuntary nature of Occidental's exchange, when coupled with the absence of the possibility of speculative abuse of inside information, convinces us that 16 (b) should not apply to transactions such as this one. *601 IV Petitioner also claims that the Occidental-Tenneco option agreement should itself be considered a sale, either because it was the kind of transaction the statute was designed to prevent or because the agreement was an option in form but a sale in fact. But the mere execution of an option to sell is not generally regarded as a "sale." See cert. denied, ; Allis-Chalmers Mfg. v. Gulf & Western Industries, ; Marquette Cement Mfg. v. Andreas, And we do not find in the execution of the Occidental-Tenneco option agreement a sufficient possibility for the speculative abuse of inside information with respect to Old Kern's affairs to warrant holding that the option agreement was itself a "sale" within the meaning of 16 (b). The mutual advantages of the arrangement appear quite clear. As the District Court found, Occidental wanted to avoid the position of a minority stockholder with a huge investment in a company over which it had no control and in which it had not chosen to invest. On the other hand, Tenneco did not want a potentially troublesome minority stockholder that had just been vanquished in a fight for the control of Old Kern. Motivations like these do not smack of insider trading; and it is not clear to us, as it was not to the Court of Appeals, how the negotiation and execution of the option agreement gave Occidental any possible opportunity to trade on inside information it might have obtained from its position as a major stockholder of Old Kern. Occidental wanted to get out, but only at a date more than six months thence. It was willing to get out at a price of $105 per share, a price at which it had publicly valued Tenneco preferred on May 19 when the Tenneco-Old Kern agreement was announced. *602 In any event, Occidental was dealing with the putative new owners of Old Kern, who undoubtedly knew more about Old Kern and Tenneco's affairs than did Occidental. If Occidental had leverage in dealing with Tenneco, it is incredible that its source was inside information rather than the fact of its large stock ownership itself. Neither does it appear that the option agreement, as drafted and executed by the parties, offered measurable possibilities for speculative abuse. What Occidental granted was a "call" option. Tenneco had the right to buy after six months, but Occidental could not force Tenneco to buy. The price was fixed at $105 for each share of Tenneco preferred. Occidental could not share in a rising market for the Tenneco stock See 306 F.2d If the stock fell more than $10 per share, the option might not be exercised, and Occidental might suffer a loss if the market further deteriorated to a point where Occidental was forced to sell. Thus, the option, by its very form, left Occidental with no choice but to sell if Tenneco exercised the option, which it was almost sure to do if the value of Tenneco stock remained relatively steady. On the other hand, it is difficult to perceive any speculative value to Occidental if the stock declined and Tenneco chose not to exercise its option. See generally Note, Put and Call Options Under Section 16 of the Securities Exchange Act, 69 Yale L. J. 868 (1960); H. Filer, Understanding Put and Call Options 96-111 ; G. Leffler, The Stock Market 363-378 (2d ed. 1957). The option, therefore, does not appear to have been an instrument with potential for speculative abuse, whether or not Occidental possessed inside information about the affairs of Old Kern. In addition, the option covered Tenneco preference stock, a stock as yet unissued, unregistered, and untraded. It was the value of this *603 stock that underlay the option and that determined whether the option would be exercised, whether Occidental would be able to profit from the exercise, and whether there was any real likelihood of the exploitation of inside information. If Occidental had inside information when it negotiated and signed the option agreement, it was inside information with respect to Old Kern. Whatever it may have known or expected as to the future value of Old Kern stock, Occidental had no ownership position in Tenneco giving it any actual or presumed insights into the future value of Tenneco stock. That was the critical item of intelligence if Occidental was to use the option for purposes of speculation. Also, the date for exercise of the option was over six months in the future, a period that, under the statute itself, is assumed to dissipate whatever trading advantage might be imputed to a major stockholder with inside information. See Comment, Stock Exchanges Pursuant to Corporate Consolidation: A Section 16 (b) "Purchase or Sale?," ; By enshrining the statutory period into the option. Occidental also, at least if the statutory period is taken to accomplish its intended purpose, limited its speculative possibilities. Nor should it be forgotten that there was no absolute assurance that the merger, which was not controlled by Occidental, would be consummated. In the event the merger did not close, the option itself would become null and void. Nor can we agree that we must reverse the Court of Appeals on the ground that the option agreement was in fact a sale because the premium paid was so large as to make the exercise of the option almost inevitable, particularly when coupled with Tenneco's desire to rid itself of a potentially troublesome stockholder. The argument has force, but resolution of the question is very much a matter of judgment, economic and otherwise, and the *604 Court of Appeals rejected the argument. That court emphasized that the premium paid was what experts had said the option was worth, the possibility that the market might drop sufficiently in the six months following execution of the option to make exercise unlikely, and the fact that here, unlike the situation in the optionor did not surrender practically all emoluments of ownership by executing the option. Nor did any other special circumstances indicate that the parties understood and intended that the option was in fact a sale.[30] We see no satisfactory basis or reason for disagreeing with the judgment of the Court of Appeals in this respect.[31] The judgment of the Court of Appeals is affirmed. So ordered. *605 MR. JUSTICE DOUGLAS, with whom MR. JUSTICE BRENNAN and MR. |
Justice Scalia | concurring | false | United States v. Estate of Romani | 1998-04-29T00:00:00 | null | https://www.courtlistener.com/opinion/118201/united-states-v-estate-of-romani/ | https://www.courtlistener.com/api/rest/v3/clusters/118201/ | 1,998 | 1997-058 | 1 | 9 | 0 | I join the opinion of the Court except that portion which takes seriously, and thus encourages in the future, an argument that should be laughed out of court. The Government contended that 31 U.S. C. § 3713(a) must have priority over the Federal Tax Lien Act of 1966, because in 1966 and again in 1970 Congress "failed to enact" a proposal put forward by the American Bar Association that would have subordinated § 3713(a) to the Tax Lien Act, citing hearings before the House Committee on Ways and Means, and a bill proposed in, but not passed by, the Senate. See Brief for United States 25-27, and n. 10 (citing American Bar Association, Final Report of the Committee on Federal Liens 7, 122-124 (1959), contained in Hearings on H. R. 11256 and 11290 before the House Committee on Ways and Means, 89th Cong., 2d Sess., 85, 199 (1966); S. 2197, 92d Cong., 1st Sess. (1971)). The Court responds that these rejected proposals "provide no support for the hypothesis that both Houses of Congress silently endorsed" the supremacy of § 3713, ante, at 534, because those proposals contained other provisions as well, and might have been rejected because of those other provisions, or because Congress thought the existing law already made § 3713 supreme. This implies that, if the proposals had not contained those additional features, or if Members of Congress (or some part of them) had somehow made clear in the course of rejecting them that they wanted the existing supremacy of the Tax Lien Act to subsist, the rejection would "provide support" for the Government's case.
That is not so, for several reasons. First and most obviously, Congress cannot express its will by a failure to legislate. The act of refusing to enact a law (if that can be called an act) has utterly no legal effect, and thus has utterly no place in a serious discussion of the law. The Constitution sets forth the only manner in which the Members of Congress have the power to impose their will upon the country: *536 by a bill that passes both Houses and is either signed by the President or repassed by a supermajority after his veto. Art. I, § 7. Everything else the Members of Congress do is either prelude or internal organization. Congress can no more express its will by not legislating than an individual Member can express his will by not voting.
Second, even if Congress could express its will by not legislating, the will of a later Congress that a law enacted by an earlier Congress should bear a particular meaning is of no effect whatever. The Constitution puts Congress in the business of writing new laws, not interpreting old ones. "[L]ater enacted laws . . . do not declare the meaning of earlier law." Almendarez-Torres v. United States, ante, at 237; ante, at 269-270 (Scalia, J., dissenting) ("This later amendment can of course not cause [the statute] to have meant, at the time of petitioner's conviction, something different from what it then said"). If the enacted intent of a later Congress cannot change the meaning of an earlier statute, then it should go without saying that the later unenacted intent cannot possibly do so. It should go without saying, and it should go without arguing as well.
I have in the past been critical of the Court's using the so-called legislative history of an enactment (hearings, committee reports, and floor debates) to determine its meaning. See, e. g., Conroy v. Aniskoff, 507 U.S. 511, 518-529 (1993) (Scalia, J., concurring in judgment); United States v. Thompson/Center Arms Co., 504 U.S. 505, 521 (1992) (Scalia, J., concurring in judgment); Blanchard v. Bergeron, 489 U.S. 87, 98-100 (1989) (Scalia, J., concurring in part and concurring in judgment). Today, however, the Court's fascination with the files of Congress (we must consult them, because they are there) is carried to a new silly extreme. Today's opinion ever-so-carefully analyzes, not legislative history, but the history of legislation-that-never-was. If we take this sort of material seriously, we require conscientious counsel to investigate (at clients' expense) not only the hearings, *537 committee reports, and floor debates pertaining to the history of the law at issue (which is bad enough), but to find, and then investigate the hearings, committee reports, and floor debates pertaining to, later bills on the same subject that were never enacted. This is beyond all reason, and we should say so.
| I join the opinion of the Court except that portion which takes seriously, and thus encourages in the future, an argument that should be laughed out of court. The Government contended that 31 U.S. C. 3713(a) must have priority over the Federal Tax Lien Act of 1966, because in 1966 and again in 1970 Congress "failed to enact" a proposal put forward by the American Bar Association that would have subordinated 3713(a) to the Tax Lien Act, citing hearings before the House Committee on Ways and Means, and a bill proposed in, but not passed by, the Senate. See Brief for United States 25-27, and n. 10 (citing American Bar Association, Final Report of the Committee on Federal Liens 7, 122-124 (1959), contained in Hearings on H. R. 11256 and 11290 before the House Committee on Ways and Means, 89th Cong., 2d Sess., 85, 199 (1966); S. 2197, 92d Cong., 1st Sess. (1971)). The Court responds that these rejected proposals "provide no support for the hypothesis that both Houses of Congress silently endorsed" the supremacy of 3713, ante, at 534, because those proposals contained other provisions as well, and might have been rejected because of those other provisions, or because Congress thought the existing law already made 3713 supreme. This implies that, if the proposals had not contained those additional features, or if Members of Congress (or some part of them) had somehow made clear in the course of rejecting them that they wanted the existing supremacy of the Tax Lien Act to subsist, the rejection would "provide support" for the Government's case. That is not so, for several reasons. First and most obviously, Congress cannot express its will by a failure to legislate. The act of refusing to enact a law (if that can be called an act) has utterly no legal effect, and thus has utterly no place in a serious discussion of the law. The Constitution sets forth the only manner in which the Members of Congress have the power to impose their will upon the country: *536 by a bill that passes both Houses and is either signed by the President or repassed by a supermajority after his veto. Art. I, 7. Everything else the Members of Congress do is either prelude or internal organization. Congress can no more express its will by not legislating than an individual Member can express his will by not voting. Second, even if Congress could express its will by not legislating, the will of a later Congress that a law enacted by an earlier Congress should bear a particular meaning is of no effect whatever. The Constitution puts Congress in the business of writing new laws, not interpreting old ones. "[L]ater enacted laws do not declare the meaning of earlier law." Almendarez-Torres v. United States, ante, at 237; ante, at 269-270 (Scalia, J., dissenting) ("This later amendment can of course not cause [the statute] to have meant, at the time of petitioner's conviction, something different from what it then said"). If the enacted intent of a later Congress cannot change the meaning of an earlier statute, then it should go without saying that the later unenacted intent cannot possibly do so. It should go without saying, and it should go without arguing as well. I have in the past been critical of the Court's using the so-called legislative history of an enactment (hearings, committee reports, and floor debates) to determine its meaning. See, e. g., ; United ; Today, however, the Court's fascination with the files of Congress (we must consult them, because they are there) is carried to a new silly extreme. Today's opinion ever-so-carefully analyzes, not legislative history, but the history of legislation-that-never-was. If we take this sort of material seriously, we require conscientious counsel to investigate (at clients' expense) not only the hearings, *537 committee reports, and floor debates pertaining to the history of the law at issue (which is bad enough), but to find, and then investigate the hearings, committee reports, and floor debates pertaining to, later bills on the same subject that were never enacted. This is beyond all reason, and we should say so. |
Justice White | dissenting | false | US Bulk Carriers, Inc. v. Arguelles | 1971-01-13T00:00:00 | null | https://www.courtlistener.com/opinion/108226/us-bulk-carriers-inc-v-arguelles/ | https://www.courtlistener.com/api/rest/v3/clusters/108226/ | 1,971 | 1970-020 | 2 | 5 | 4 | Respondent Arguelles is a seaman who signed onto the SS U. S. Pecos, a merchant ship owned by petitioner, on August 3, 1965, for six months' employment at a stated monthly wage. The employment relationship was *367 governed by the collective-bargaining agreement between petitioner and the National Maritime Union, AFL-CIO, of which respondent is a member.
On February 3, 1966, the day after respondent's shipping papers expired by their terms, the Pecos anchored off Cape St. Jacques, South Vietnam, awaiting authorization to proceed to Saigon harbor. Respondent concedes that congestion in the harbor was the cause of the extended wait offshore.[1] During this time, Saigon port officials refused to grant pratique, or quarantine clearance, to crew members. Nonetheless, respondent demanded discharge or shore leave, both of which were refused.[2] On February 13, the Pecos was authorized to, and did, proceed to the harbor and tie up at a designated location. Unloading of cargo began February 16, and the following day respondent and other crew members were discharged and given a voucher for their wages at the American Consulate in Saigon.[3] The voucher called for payment in American currency at petitioner's headquarters in Galveston, Texas. On February 18, respondent departed Saigon by air for Galveston, where he was paid in cash on February 22.
*368 While in Galveston, respondent notified the union's local office that he was dissatisfied with the company's refusal to honor certain wage, penalty, and miscellaneous claims.[4] The respondent was advised to contact his union representative with details, but instead of doing so, he brought this suit in the District Court under its admiralty and maritime jurisdiction, 28 U.S. C. § 1333. Respondent sought recovery on three claims which survive here: (a) overtime for work allegedly performed prior to February 3, 1966; (b) overtime for wrongful restriction to the ship for 11 days between arrival at Cape St. Jacques on February 3 and tying up in the port of Saigon on February 13 despite requests for shore leave;[5] (c) a statutory penalty of $254.95 under 46 U.S. C. § 596,[6] based on two days' pay for each day between *369 February 3 and February 22, when respondent was paid at Galveston. Petitioner answered by alleging the failure of respondent to exhaust the grievance and arbitration procedures of the collective-bargaining agreement.[7] Petitioner contends that (a) the master did not *370 authorize any overtime work before February 3; (b) the restriction to ship between February 3 and February 13 was due to the failure of Saigon port officials to lift quarantine restrictions, and (c) because respondent was paid promptly by voucher at the American Consulate on the day of discharge, no penalty obtains.
The collective-bargaining agreement provides in relevant part that (a) no overtime work shall be performed without the authorization of the master (Art. IV, § 2); (b) with exceptions not relevant here, no overtime will be paid for restriction to ship when such restriction is *371 due to the regulation of government authorities (Art. III, § 2), and (c) a ship shall not be deemed to have arrived in port while it is awaiting quarantine clearance (Art. III, § 1 (c)).
The merits of respondent's nonstatutory claims depend entirely on interpretation and application of the bargaining agreement. Specifically, the threshold questions involved are (a) whether the respondent performed overtime work with the authorization of the master; (b) whether the crew was confined to ship because of the actions of government officials and if so whether respondent can base his claim on the alleged failure of the master to show the required documents to the crew, and (c) whether the ship had arrived "in port" on February 3, so that respondent was entitled to discharge and payment, or, in the alternative, whether the fact that respondent's shipping articles expired by their terms on February 2 entitled him to discharge against petitioner's claim that where the cargo is still aboard in such cases the articles are automatically extended. An additional question is whether respondent was "paid" on February 17 or February 22, since the penalty accrues only until the date of payment.
Most importantly, for purposes of this case, it is clear that the question of whether respondent was entitled to the statutory penalty depends entirely on a resolution of these questions. If it develops that petitioner has paid respondent all wages due him in a timely manner, the statutory penalty claim also disappears.
These questions are particularly within the competence of the contractually established grievance procedure of the collective-bargaining agreement. They are all questions of fact or interpretation of various provisions of the agreement. There is not the slightest indication or contention that the grievance machinery would be unable *372 to determine these questions, or that it would be inferior to a federal court in so doing. It is clear from the face of the claims that a familiarity with the customs and practices of shipping would be distinctly helpful in assessing the validity of the claims. This familiarity is, of course, one of the prime attributes of an arbitrator. As the Court said in United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582 (1960):
"The labor arbitrator is usually chosen because of the parties' confidence in his knowledge of the common law of the shop and their trust in his personal judgment to bring to bear considerations which are not expressed in the contract as criteria for judgment. The parties expect that his judgment of a particular grievance will reflect not only what the contract says but, insofar as the collective bargaining agreement permits, such factors as the effect upon productivity of a particular result, its consequence to the morale of the shop, his judgment whether tensions will be heightened or diminished. For the parties' objective in using the arbitration process is primarily to further their common goal of uninterrupted production under the agreement, to make the agreement serve their specialized needs. The ablest judge cannot be expected to bring the same experience and competence to bear upon the determination of a grievance, because he cannot be similarly informed."
In Textile Workers v. Lincoln Mills, 353 U.S. 448 (1957), it was held that federal courts have jurisdiction to specifically enforce the arbitration provisions of the collective-bargaining agreement. And it has been clear at least since Republic Steel Corp. v. Maddox, 379 U.S. 650 (1965), that absent extraordinary circumstances not *373 alleged here, contractual grievance procedures must be exhausted before suit can be brought.[8]
The collective agreement reveals that the parties intended all disputes and grievances, not merely those based on the contract, to be resolved if possible through the contractual procedure. Article II provides a threestep on-board grievance procedure for "[a]ny employee who feels that he has been unjustly treated or been subjected to an unfair consideration." If no satisfactory solution is reached on board, the parties are directed to proceed "through the grievance machinery of this agreement at the port where shipping articles are closed or at a continental American port where the Company maintains an operating office and the Union maintains an *374 agent." Provisions are made for any party to a "dispute or grievance" to seek expeditious determination from the arbitrator. Art. XII, § 3. The parties made no provision whatever for excepting statutory penalty claims from the grievance machinery. Prior decisions unmistakably limit the role of the courts to determining whether a dispute is arguably covered under the arbitration clause. "In the absence of any express provision excluding a particular grievance from arbitration, we think only the most forceful evidence of a purpose to exclude the claim from arbitration can prevail, particularly where, as here, the exclusion clause is vague and the arbitration clause quite broad." United Steelworkers v. Warrior & Gulf Navigation Co., supra, at 584-585.
Nor until now has there been any principle that requires contract rights to be resolved internally but directs statutorily created remedies to be presented to the court, at least where, as here, the availability of the statutory remedy rests on disputed issues that are cognizable under the arbitration clause. In fact, this Court and lower federal courts have endorsed the suitability of arbitration to resolve federally created rights. In Wilko v. Swan, 346 U.S. 427 (1953), the Court expressed "hope for [arbitration's] usefulness . . . in controversies based on statutes . . . ." Id., at 432. And courts of appeals both before and after passage of § 301 have required that Fair Labor Standards Act employees' claims for liquidated damages under 29 U.S. C. § 216 (b) for failure to pay overtime wages be referred to contractual grievance procedures before being presented to the court. Donahue v. Susquehanna Collieries Co., 138 F.2d 3 (CA3 1943); Evans v. Hudson Coal Co., 165 F.2d 970 (CA3 1948); Beckley v. Teyssier, 332 F.2d 495 (CA9 1964). Cf. Fallick v. Kehr, 369 F.2d 899 (CA2 1966); Old Dutch Farms v. Local 584, I. B. T., 243 F. Supp. 246 (EDNY 1965); *375 United States Steel Corp. v. Seafarers, 237 F. Supp. 529 (ED Pa. 1965). That the question of penalties or liquidated damages should be referred in the first instance to applicable grievance procedures is especially proper where, as here, there are also underlying wage claims based on factual disputes, and whose resolution will determine whether, and to what extent, the penalty is due. Neither do I see any reason why the issue of the penalty would be unsuitable for arbitration even if the owner paid off all disputed underlying wage claims, leaving only the question of the statutory penalty. On the contrary, if respondent's claims are not reached by his promise to arbitrate, or if the promise to arbitrate is unenforceable, a master or owner could pay off wages in full, but grossly late, secure in the knowledge that the obligation to pay the penalty would not be susceptible of the quick and informal arbitration process, but must await the attention of a federal district court which may be thousands of miles away. Overreaching and delay were precisely the evils that § 596 was designed to reach. Mavromatis v. United Greek Shipowners Corp., 179 F.2d 310 (CA1 1950).
The Court tries to avoid this problem by holding that grievance procedures are available to the seaman to pursue if he chooses. The effect of this is to hold contractual remedies enforceable by the employee but not by the employer. This is not only a curious application of § 301 and contract principles but an unwise departure from past cases. In Republic Steel Corp. v. Maddox, supra, the Court foresaw that under such circumstances the employer, "to limit the modes of redress that could be used against him," would simply insist in future bargaining that suits for overtime pay[9] be eliminated from *376 the grievance procedure. The Court was entirely correct in surmising that "[t]he union would hardly favor the elimination, for it is in the union's interest to afford comprehensive protection to those it represents, to participate in interpretations of the contract, and to have an arbitrator rather than a court decide such questions . . . ." 379 U.S., at 656.
Nothing in the words of the statute warrants dispensing with contractual procedures. Section 596 provides that the penalty "shall be recoverable as wages in any claim made before the court." (Emphasis added.) The statute on its face makes the penalty a wage claim; it would in no way be in derogation of the statute to require this claim to be presented like any other wage claim. Under the principles of Republic Steel Corp. v. Maddox, supra, this means that the internal remedies must first be exhausted.
Even assuming, without conceding, that § 596 provides a direct route to federal courts on penalty claims, § 301 should at least require that the contractual bases for the penalty claim be settled by contractual methods before penalty claims may be adjudicated by the courts. The penalty statute is a direct descendant of 1 Stat. 133, passed in 1790. Section 596 has existed unchanged since 1915. Section 301, on the other hand, was enacted in 1947 as a farreaching measure designed to secure the enforcement of arbitration agreements in the federal courts in the belief that "industrial peace can be best obtained only in that way." Textile Workers v. Lincoln Mills, supra, at 455. Section 301 did away with common-law rules against enforcing executory promises to arbitrate, and there should be no reluctance to accommodate § 596 and the policy of § 301 by withholding judicial relief until contractual remedies are exhausted.
It should also be recalled that even though a dispute also involves an unfair labor practice or a representation *377 or jurisdictional dispute it is nevertheless not removed from the arbitral process. Smith v. Evening News Assn., 371 U.S. 195 (1962); Carey v. Westinghouse Corp., 375 U.S. 261 (1964).[10] Both the National Labor Relations Board and this Court have shown a high regard for the informed opinion of the arbitrator in such cases. International Harvester Co., 138 N. L. R. B. 923, 925-926 (1962); Carey v. Westinghouse Corp., supra, at 272.
Moreover, prior to the passage of § 301, nonmaritime employees, like seamen, could go to court to resolve disputes over the meaning of the collective-bargaining agreement. Given the basis for federal jurisdiction, they could go to federal court. In this respect they were no different from seamen. When § 301 provided for the enforcement of arbitration agreements and, as interpreted in Maddox, for exhaustion of internal remedies, there is not the slightest indication that Congress intended that seamen should be treated any differently from their nonmaritime counterparts.
Finally, it is pertinent to recall the words of the District Court in the instant case in granting summary judgment to the petitioner:
"The policy established by the cases referred to, that matters of this sort should be left to procedures set up between the union and the employer, is, in the opinion of the Court, a most important policy lest this Court be inundated with small claims of the type which has been presented to the Court today." App. 55a.
*378 In short, the Court today makes an unnecessary and ill-advised detour around the body of arbitration law developed by Congress and this Court. Its reasons for doing so, in my opinion, comport with neither the language of the statute nor considerations of sound labor and maritime policy.
| Respondent Arguelles is a seaman who signed onto the SS U S Pecos, a merchant ship owned by petitioner, on August 3, for six months' employment at a stated monthly wage The employment relationship was *367 governed by the collective-bargaining agreement between petitioner and the National Maritime Union, AFL-CIO, of which respondent is a member On February 3, the day after respondent's shipping papers expired by their terms, the Pecos anchored off Cape St Jacques, South Vietnam, awaiting authorization to proceed to Saigon harbor Respondent concedes that congestion in the harbor was the cause of the extended wait offshore[1] During this time, Saigon port officials refused to grant pratique, or quarantine clearance, to crew members Nonetheless, respondent demanded discharge or shore leave, both of which were refused[2] On February 13, the Pecos was authorized to, and did, proceed to the harbor and tie up at a designated location Unloading of cargo began February 16, and the following day respondent and other crew members were discharged and given a voucher for their wages at the American Consulate in Saigon[3] The voucher called for payment in American currency at petitioner's headquarters in Galveston, Texas On February 18, respondent departed Saigon by air for Galveston, where he was paid in cash on February 22 *368 While in Galveston, respondent notified the union's local office that he was dissatisfied with the company's refusal to honor certain wage, penalty, and miscellaneous claims[4] The respondent was advised to contact his union representative with details, but instead of doing so, he brought this suit in the District Court under its admiralty and maritime jurisdiction, 28 US C 1333 Respondent sought recovery on three claims which survive here: (a) overtime for work allegedly performed prior to February 3, ; (b) overtime for wrongful restriction to the ship for 11 days between arrival at Cape St Jacques on February 3 and tying up in the port of Saigon on February 13 despite requests for shore leave;[5] (c) a statutory penalty of $25495 under 46 US C 596,[6] based on two days' pay for each day between *369 February 3 and February 22, when respondent was paid at Galveston Petitioner answered by alleging the failure of respondent to exhaust the grievance and arbitration procedures of the collective-bargaining agreement[7] Petitioner contends that (a) the master did not *370 authorize any overtime work before February 3; (b) the restriction to ship between February 3 and February 13 was due to the failure of Saigon port officials to lift quarantine restrictions, and (c) because respondent was paid promptly by voucher at the American Consulate on the day of discharge, no penalty obtains The collective-bargaining agreement provides in relevant part that (a) no overtime work shall be performed without the authorization of the master (Art IV, 2); (b) with exceptions not relevant here, no overtime will be paid for restriction to ship when such restriction is *371 due to the regulation of government authorities (Art III, 2), and (c) a ship shall not be deemed to have arrived in port while it is awaiting quarantine clearance (Art III, 1 (c)) The merits of respondent's nonstatutory claims depend entirely on interpretation and application of the bargaining agreement Specifically, the threshold questions involved are (a) whether the respondent performed overtime work with the authorization of the master; (b) whether the crew was confined to ship because of the actions of government officials and if so whether respondent can base his claim on the alleged failure of the master to show the required documents to the crew, and (c) whether the ship had arrived "in port" on February 3, so that respondent was entitled to discharge and payment, or, in the alternative, whether the fact that respondent's shipping articles expired by their terms on February 2 entitled him to discharge against petitioner's claim that where the cargo is still aboard in such cases the articles are automatically extended An additional question is whether respondent was "paid" on February 17 or February 22, since the penalty accrues only until the date of payment Most importantly, for purposes of this case, it is clear that the question of whether respondent was entitled to the statutory penalty depends entirely on a resolution of these questions If it develops that petitioner has paid respondent all wages due him in a timely manner, the statutory penalty claim also disappears These questions are particularly within the competence of the contractually established grievance procedure of the collective-bargaining agreement They are all questions of fact or interpretation of various provisions of the agreement There is not the slightest indication or contention that the grievance machinery would be unable *372 to determine these questions, or that it would be inferior to a federal court in so doing It is clear from the face of the claims that a familiarity with the customs and practices of shipping would be distinctly helpful in assessing the validity of the claims This familiarity is, of course, one of the prime attributes of an arbitrator As the Court said in United : "The labor arbitrator is usually chosen because of the parties' confidence in his knowledge of the common law of the shop and their trust in his personal judgment to bring to bear considerations which are not expressed in the contract as criteria for judgment The parties expect that his judgment of a particular grievance will reflect not only what the contract says but, insofar as the collective bargaining agreement permits, such factors as the effect upon productivity of a particular result, its consequence to the morale of the shop, his judgment whether tensions will be heightened or diminished For the parties' objective in using the arbitration process is primarily to further their common goal of uninterrupted production under the agreement, to make the agreement serve their specialized needs The ablest judge cannot be expected to bring the same experience and competence to bear upon the determination of a grievance, because he cannot be similarly informed" In Textile it was held that federal courts have jurisdiction to specifically enforce the arbitration provisions of the collective-bargaining agreement And it has been clear at least since Republic Steel that absent extraordinary circumstances not *373 alleged here, contractual grievance procedures must be exhausted before suit can be brought[8] The collective agreement reveals that the parties intended all disputes and grievances, not merely those based on the contract, to be resolved if possible through the contractual procedure Article II provides a threestep on-board grievance procedure for "[a]ny employee who feels that he has been unjustly treated or been subjected to an unfair consideration" If no satisfactory solution is reached on board, the parties are directed to proceed "through the grievance machinery of this agreement at the port where shipping articles are closed or at a continental American port where the Company maintains an operating office and the Union maintains an *374 agent" Provisions are made for any party to a "dispute or grievance" to seek expeditious determination from the arbitrator Art XII, 3 The parties made no provision whatever for excepting statutory penalty claims from the grievance machinery Prior decisions unmistakably limit the role of the courts to determining whether a dispute is arguably covered under the arbitration clause "In the absence of any express provision excluding a particular grievance from arbitration, we think only the most forceful evidence of a purpose to exclude the claim from arbitration can prevail, particularly where, as here, the exclusion clause is vague and the arbitration clause quite broad" United Nor until now has there been any principle that requires contract rights to be resolved internally but directs statutorily created remedies to be presented to the court, at least where, as here, the availability of the statutory remedy rests on disputed issues that are cognizable under the arbitration clause In fact, this Court and lower federal courts have endorsed the suitability of arbitration to resolve federally created rights In the Court expressed "hope for [arbitration's] usefulness in controversies based on statutes " And courts of appeals both before and after passage of 301 have required that Fair Labor Standards Act employees' claims for liquidated damages under 29 US C 216 (b) for failure to pay overtime wages be referred to contractual grievance procedures before being presented to the court Donahue v Susquehanna Collieries ; Evans v Hudson Coal ; Cf ; Old Dutch ; *375 United States Steel That the question of penalties or liquidated damages should be referred in the first instance to applicable grievance procedures is especially proper where, as here, there are also underlying wage claims based on factual disputes, and whose resolution will determine whether, and to what extent, the penalty is due Neither do I see any reason why the issue of the penalty would be unsuitable for arbitration even if the owner paid off all disputed underlying wage claims, leaving only the question of the statutory penalty On the contrary, if respondent's claims are not reached by his promise to arbitrate, or if the promise to arbitrate is unenforceable, a master or owner could pay off wages in full, but grossly late, secure in the knowledge that the obligation to pay the penalty would not be susceptible of the quick and informal arbitration process, but must await the attention of a federal district court which may be thousands of miles away Overreaching and delay were precisely the evils that 596 was designed to reach The Court tries to avoid this problem by holding that grievance procedures are available to the seaman to pursue if he chooses The effect of this is to hold contractual remedies enforceable by the employee but not by the employer This is not only a curious application of 301 and contract principles but an unwise departure from past cases In Republic Steel the Court foresaw that under such circumstances the employer, "to limit the modes of redress that could be used against him," would simply insist in future bargaining that suits for overtime pay[9] be eliminated from *376 the grievance procedure The Court was entirely correct in surmising that "[t]he union would hardly favor the elimination, for it is in the union's interest to afford comprehensive protection to those it represents, to participate in interpretations of the contract, and to have an arbitrator rather than a court decide such questions " Nothing in the words of the statute warrants dispensing with contractual procedures Section 596 provides that the penalty "shall be recoverable as wages in any claim made before the court" (Emphasis added) The statute on its face makes the penalty a wage claim; it would in no way be in derogation of the statute to require this claim to be presented like any other wage claim Under the principles of Republic Steel this means that the internal remedies must first be exhausted Even assuming, without conceding, that 596 provides a direct route to federal courts on penalty claims, 301 should at least require that the contractual bases for the penalty claim be settled by contractual methods before penalty claims may be adjudicated by the courts The penalty statute is a direct descendant of 1 Stat 133, passed in 1790 Section 596 has existed unchanged since 1915 Section 301, on the other hand, was enacted in 1947 as a farreaching measure designed to secure the enforcement of arbitration agreements in the federal courts in the belief that "industrial peace can be best obtained only in that way" Textile Section 301 did away with common-law rules against enforcing executory promises to arbitrate, and there should be no reluctance to accommodate 596 and the policy of 301 by withholding judicial relief until contractual remedies are exhausted It should also be recalled that even though a dispute also involves an unfair labor practice or a representation *377 or jurisdictional dispute it is nevertheless not removed from the arbitral process Smith v Evening News Assn, 371 US 195 ; Carey v Westinghouse Corp, 375 US 261 [10] Both the National Labor Relations Board and this Court have shown a high regard for the informed opinion of the arbitrator in such cases International Harvester 138 N L R B 923, 925-926 ; Carey v Westinghouse Corp, Moreover, prior to the passage of 301, nonmaritime employees, like seamen, could go to court to resolve disputes over the meaning of the collective-bargaining agreement Given the basis for federal jurisdiction, they could go to federal court In this respect they were no different from seamen When 301 provided for the enforcement of arbitration agreements and, as interpreted in for exhaustion of internal remedies, there is not the slightest indication that Congress intended that seamen should be treated any differently from their nonmaritime counterparts Finally, it is pertinent to recall the words of the District Court in the instant case in granting summary judgment to the petitioner: "The policy established by the cases referred to, that matters of this sort should be left to procedures set up between the union and the employer, is, in the opinion of the Court, a most important policy lest this Court be inundated with small claims of the type which has been presented to the Court today" App 55a *378 In short, the Court today makes an unnecessary and ill-advised detour around the body of arbitration law developed by Congress and this Court Its reasons for doing so, in my opinion, comport with neither the language of the statute nor considerations of sound labor and maritime policy |
Justice White | majority | false | Cohen v. Cowles Media Co. | 1991-06-24T00:00:00 | null | https://www.courtlistener.com/opinion/112638/cohen-v-cowles-media-co/ | https://www.courtlistener.com/api/rest/v3/clusters/112638/ | 1,991 | 1990-120 | 1 | 5 | 4 | The question before us is whether the First Amendment prohibits a plaintiff from recovering damages, under state promissory estoppel law, for a newspaper's breach of a promise of confidentiality given to the plaintiff in exchange for information. We hold that it does not.
During the closing days of the 1982 Minnesota gubernatorial race, Dan Cohen, an active Republican associated with Wheelock Whitney's Independent-Republican gubernatorial campaign, approached reporters from the St. Paul Pioneer Press Dispatch (Pioneer Press) and the Minneapolis Star and Tribune (Star Tribune) and offered to provide documents relating to a candidate in the upcoming election. Cohen made clear to the reporters that he would provide the information only if he was given a promise of confidentiality. Reporters from both papers promised to keep Cohen's identity anonymous and Cohen turned over copies of two public court records concerning Marlene Johnson, the Democratic-Farmer-Labor candidate for Lieutenant Governor. The first record indicated that Johnson had been charged in 1969 with three counts of unlawful assembly, and the second that she had been convicted in 1970 of petit theft. Both newspapers interviewed Johnson for her explanation and one reporter tracked down the person who had found the records for Cohen. As it turned out, the unlawful assembly charges arose out of Johnson's participation in a protest of an alleged failure to hire minority workers on municipal construction projects, and the charges were eventually dismissed. The petit theft conviction was for leaving a store without paying *666 for $6 worth of sewing materials. The incident apparently occurred at a time during which Johnson was emotionally distraught, and the conviction was later vacated.
After consultation and debate, the editorial staffs of the two newspapers independently decided to publish Cohen's name as part of their stories concerning Johnson. In their stories, both papers identified Cohen as the source of the court records, indicated his connection to the Whitney campaign, and included denials by Whitney campaign officials of any role in the matter. The same day the stories appeared, Cohen was fired by his employer.
Cohen sued respondents, the publishers of the Pioneer Press and Star Tribune, in Minnesota state court, alleging fraudulent misrepresentation and breach of contract. The trial court rejected respondents' argument that the First Amendment barred Cohen's lawsuit. A jury returned a verdict in Cohen's favor, awarding him $200,000 in compensatory damages and $500,000 in punitive damages. The Minnesota Court of Appeals, in a split decision, reversed the award of punitive damages after concluding that Cohen had failed to establish a fraud claim, the only claim which would support such an award. 445 N.W.2d 248, 260 (1989). However, the court upheld the finding of liability for breach of contract and the $200,000 compensatory damages award. Id., at 262.
A divided Minnesota Supreme Court reversed the compensatory damages award. 457 N.W.2d 199 (1990). After affirming the Court of Appeals' determination that Cohen had not established a claim for fraudulent misrepresentation, the court considered his breach-of-contract claim and concluded that "a contract cause of action is inappropriate for these particular circumstances." Id., at 203. The court then went on to address the question whether Cohen could establish a cause of action under Minnesota law on a promissory estoppel theory. Apparently, a promissory estoppel theory was never tried to the jury, nor briefed nor argued by *667 the parties; it first arose during oral argument in the Minnesota Supreme Court when one of the justices asked a question about equitable estoppel. See App. 38.
In addressing the promissory estoppel question, the court decided that the most problematic element in establishing such a cause of action here was whether injustice could be avoided only by enforcing the promise of confidentiality made to Cohen. The court stated: "Under a promissory estoppel analysis there can be no neutrality towards the First Amendment. In deciding whether it would be unjust not to enforce the promise, the court must necessarily weigh the same considerations that are weighed for whether the First Amendment has been violated. The court must balance the constitutional rights of a free press against the common law interest in protecting a promise of anonymity." 457 N.W.2d, at 205. After a brief discussion, the court concluded that "in this case enforcement of the promise of confidentiality under a promissory estoppel theory would violate defendants' First Amendment rights." Ibid.
We granted certiorari to consider the First Amendment implications of this case. 498 U.S. 1011 (1990).
Respondents initially contend that the Court should dismiss this case without reaching the merits because the promissory estoppel theory was not argued or presented in the courts below and because the Minnesota Supreme Court's decision rests entirely on the interpretation of state law. These contentions do not merit extended discussion. It is irrelevant to this Court's jurisdiction whether a party raised below and argued a federal-law issue that the state supreme court actually considered and decided. Orr v. Orr, 440 U.S. 268, 274-275 (1979); Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749, 754, n. 2 (1985); Mills v. Maryland, 486 U.S. 367, 371, n. 3 (1988); Franks v. Delaware, 438 U.S. 154, 161-162 (1978); Jenkins v. Georgia, 418 U.S. 153, 157 (1974). Moreover, that the Minnesota Supreme Court rested its holding on federal law could not be made *668 more clear than by its conclusion that "in this case enforcement of the promise of confidentiality under a promissory estoppel theory would violate defendants' First Amendment rights." 457 N.W.2d, at 205. It can hardly be said that there is no First Amendment issue present in the case when respondents have defended against this suit all along by arguing that the First Amendment barred the enforcement of the reporters' promises to Cohen. We proceed to consider whether that Amendment bars a promissory estoppel cause of action against respondents.
The initial question we face is whether a private cause of action for promissory estoppel involves "state action" within the meaning of the Fourteenth Amendment such that the protections of the First Amendment are triggered. For if it does not, then the First Amendment has no bearing on this case. The rationale of our decision in New York Times Co. v. Sullivan, 376 U.S. 254 (1964), and subsequent cases compels the conclusion that there is state action here. Our cases teach that the application of state rules of law in state courts in a manner alleged to restrict First Amendment freedoms constitutes "state action" under the Fourteenth Amendment. See, e. g., id., at 265; NAACP v. Claiborne Hardware Co., 458 U.S. 886, 916, n. 51 (1982); Philadelphia Newspapers, Inc. v. Hepps, 475 U.S. 767, 777 (1986). In this case, the Minnesota Supreme Court held that if Cohen could recover at all it would be on the theory of promissory estoppel, a state-law doctrine which, in the absence of a contract, creates obligations never explicitly assumed by the parties. These legal obligations would be enforced through the official power of the Minnesota courts. Under our cases, that is enough to constitute "state action" for purposes of the Fourteenth Amendment.
Respondents rely on the proposition that "if a newspaper lawfully obtains truthful information about a matter of public significance then state officials may not constitutionally punish publication of the information, absent a need to further a *669 state interest of the highest order." Smith v. Daily Mail Publishing Co., 443 U.S. 97, 103 (1979). That proposition is unexceptionable, and it has been applied in various cases that have found insufficient the asserted state interests in preventing publication of truthful, lawfully obtained information. See, e. g., Florida Star v. B. J. F., 491 U.S. 524 (1989); Smith v. Daily Mail, supra; Landmark Communications, Inc. v. Virginia, 435 U.S. 829 (1978).
This case, however, is not controlled by this line of cases but, rather, by the equally well-established line of decisions holding that generally applicable laws do not offend the First Amendment simply because their enforcement against the press has incidental effects on its ability to gather and report the news. As the cases relied on by respondents recognize, the truthful information sought to be published must have been lawfully acquired. The press may not with impunity break and enter an office or dwelling to gather news. Neither does the First Amendment relieve a newspaper reporter of the obligation shared by all citizens to respond to a grand jury subpoena and answer questions relevant to a criminal investigation, even though the reporter might be required to reveal a confidential source. Branzburg v. Hayes, 408 U.S. 665 (1972). The press, like others interested in publishing, may not publish copyrighted material without obeying the copyright laws. See Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 576-579 (1977). Similarly, the media must obey the National Labor Relations Act, Associated Press v. NLRB, 301 U.S. 103 (1937), and the Fair Labor Standards Act, Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 192-193 (1946); may not restrain trade in violation of the antitrust laws, Associated Press v. United States, 326 U.S. 1 (1945); Citizen Publishing Co. v. United States, 394 U.S. 131, 139 (1969); and must pay nondiscriminatory taxes, Murdock v. Pennsylvania, 319 U.S. 105, 112 (1943); Minneapolis Star & Tribune Co. v. Minnesota Comm'r of Revenue, 460 U.S. 575, 581-583 (1983). *670 Cf. University of Pennsylvania v. EEOC, 493 U.S. 182, 201-202 (1990). It is, therefore, beyond dispute that "[t]he publisher of a newspaper has no special immunity from the application of general laws. He has no special privilege to invade the rights and liberties of others." Associated Press v. NLRB, supra, at 132-133. Accordingly, enforcement of such general laws against the press is not subject to stricter scrutiny than would be applied to enforcement against other persons or organizations.
There can be little doubt that the Minnesota doctrine of promissory estoppel is a law of general applicability. It does not target or single out the press. Rather, insofar as we are advised, the doctrine is generally applicable to the daily transactions of all the citizens of Minnesota. The First Amendment does not forbid its application to the press.
JUSTICE BLACKMUN suggests that applying Minnesota promissory estoppel doctrine in this case will "punish" respondents for publishing truthful information that was lawfully obtained. Post, at 675-676. This is not strictly accurate because compensatory damages are not a form of punishment, as were the criminal sanctions at issue in Smith v. Daily Mail, supra. If the contract between the parties in this case had contained a liquidated damages provision, it would be perfectly clear that the payment to petitioner would represent a cost of acquiring newsworthy material to be published at a profit, rather than a punishment imposed by the State. The payment of compensatory damages in this case is constitutionally indistinguishable from a generous bonus paid to a confidential news source. In any event, as indicated above, the characterization of the payment makes no difference for First Amendment purposes when the law being applied is a general law and does not single out the press. Moreover, JUSTICE BLACKMUN'S reliance on cases like Florida Star v. B. J. F., supra, and Smith v. Daily Mail is misplaced. In those cases, the State itself defined the content of publications that would trigger liability. Here, by contrast, *671 Minnesota law simply requires those making promises to keep them. The parties themselves, as in this case, determine the scope of their legal obligations, and any restrictions that may be placed on the publication of truthful information are self-imposed.
Also, it is not at all clear that respondents obtained Cohen's name "lawfully" in this case, at least for purposes of publishing it. Unlike the situation in Florida Star, where the rape victim's name was obtained through lawful access to a police report, respondents obtained Cohen's name only by making a promise that they did not honor. The dissenting opinions suggest that the press should not be subject to any law, including copyright law for example, which in any fashion or to any degree limits or restricts the press' right to report truthful information. The First Amendment does not grant the press such limitless protection.
Nor is Cohen attempting to use a promissory estoppel cause of action to avoid the strict requirements for establishing a libel or defamation claim. As the Minnesota Supreme Court observed here, "Cohen could not sue for defamation because the information disclosed [his name] was true." 457 N.W.2d, at 202. Cohen is not seeking damages for injury to his reputation or his state of mind. He sought damages in excess of $50,000 for breach of a promise that caused him to lose his job and lowered his earning capacity. Thus, this is not a case like Hustler Magazine, Inc. v. Falwell, 485 U.S. 46 (1988), where we held that the constitutional libel standards apply to a claim alleging that the publication of a parody was a state-law tort of intentional infliction of emotional distress.
Respondents and amici argue that permitting Cohen to maintain a cause of action for promissory estoppel will inhibit truthful reporting because news organizations will have legal incentives not to disclose a confidential source's identity even when that person's identity is itself newsworthy. JUSTICE SOUTER makes a similar argument. But if this is the case, *672 it is no more than the incidental, and constitutionally insignificant, consequence of applying to the press a generally applicable law that requires those who make certain kinds of promises to keep them. Although we conclude that the First Amendment does not confer on the press a constitutional right to disregard promises that would otherwise be enforced under state law, we reject Cohen's request that in reversing the Minnesota Supreme Court's judgment we reinstate the jury verdict awarding him $200,000 in compensatory damages. See Brief for Petitioner 31. The Minnesota Supreme Court's incorrect conclusion that the First Amendment barred Cohen's claim may well have truncated its consideration of whether a promissory estoppel claim had otherwise been established under Minnesota law and whether Cohen's jury verdict could be upheld on a promissory estoppel basis. Or perhaps the State Constitution may be construed to shield the press from a promissory estoppel cause of action such as this one. These are matters for the Minnesota Supreme Court to address and resolve in the first instance on remand. Accordingly, the judgment of the Minnesota Supreme Court is reversed, and the case is remanded for further proceedings not inconsistent with this opinion.
So ordered. | The question before us is whether the First Amendment prohibits a plaintiff from recovering damages, under state promissory estoppel law, for a newspaper's breach of a promise of confidentiality given to the plaintiff in exchange for information. We hold that it does not. During the closing days of the 1982 Minnesota gubernatorial race, Dan Cohen, an active Republican associated with Wheelock Whitney's Independent-Republican gubernatorial campaign, approached reporters from the St. Paul Pioneer Press Dispatch (Pioneer Press) and the Minneapolis Star and Tribune (Star Tribune) and offered to provide documents relating to a candidate in the upcoming election. Cohen made clear to the reporters that he would provide the information only if he was given a promise of confidentiality. Reporters from both papers promised to keep Cohen's identity anonymous and Cohen turned over copies of two public court records concerning Marlene Johnson, the Democratic-Farmer-Labor candidate for Lieutenant Governor. The first record indicated that Johnson had been charged in 1969 with three counts of unlawful assembly, and the second that she had been convicted in 1970 of petit theft. Both newspapers interviewed Johnson for her explanation and one reporter tracked down the person who had found the records for Cohen. As it turned out, the unlawful assembly charges arose out of Johnson's participation in a protest of an alleged failure to hire minority workers on municipal construction projects, and the charges were eventually dismissed. The petit theft conviction was for leaving a store without paying *666 for $6 worth of sewing materials. The incident apparently occurred at a time during which Johnson was emotionally distraught, and the conviction was later vacated. After consultation and debate, the editorial staffs of the two newspapers independently decided to publish Cohen's name as part of their stories concerning Johnson. In their stories, both papers identified Cohen as the source of the court records, indicated his connection to the Whitney campaign, and included denials by Whitney campaign officials of any role in the matter. The same day the stories appeared, Cohen was fired by his employer. Cohen sued respondents, the publishers of the Pioneer Press and Star Tribune, in Minnesota state court, alleging fraudulent misrepresentation and breach of contract. The trial court rejected respondents' argument that the First Amendment barred Cohen's lawsuit. A jury returned a verdict in Cohen's favor, awarding him $200,000 in compensatory damages and $500,000 in punitive damages. The Minnesota Court of Appeals, in a split decision, reversed the award of punitive damages after concluding that Cohen had failed to establish a fraud claim, the only claim which would support such an award. However, the court upheld the finding of liability for breach of contract and the $200,000 compensatory damages award. A divided Minnesota Supreme Court reversed the compensatory damages award. After affirming the Court of Appeals' determination that Cohen had not established a claim for fraudulent misrepresentation, the court considered his breach-of-contract claim and concluded that "a contract cause of action is inappropriate for these particular circumstances." The court then went on to address the question whether Cohen could establish a cause of action under Minnesota law on a promissory estoppel theory. Apparently, a promissory estoppel theory was never tried to the jury, nor briefed nor argued by *667 the parties; it first arose during oral argument in the Minnesota Supreme Court when one of the justices asked a question about equitable estoppel. See App. 38. In addressing the promissory estoppel question, the court decided that the most problematic element in establishing such a cause of action here was whether injustice could be avoided only by enforcing the promise of confidentiality made to Cohen. The court stated: "Under a promissory estoppel analysis there can be no neutrality towards the First Amendment. In deciding whether it would be unjust not to enforce the promise, the court must necessarily weigh the same considerations that are weighed for whether the First Amendment has been violated. The court must balance the constitutional rights of a free press against the common law interest in protecting a promise of anonymity." After a brief discussion, the court concluded that "in this case enforcement of the promise of confidentiality under a promissory estoppel theory would violate defendants' First Amendment rights." We granted certiorari to consider the First Amendment implications of this case. Respondents initially contend that the Court should dismiss this case without reaching the merits because the promissory estoppel theory was not argued or presented in the courts below and because the Minnesota Supreme Court's decision rests entirely on the interpretation of state law. These contentions do not merit extended discussion. It is irrelevant to this Court's jurisdiction whether a party raised below and argued a federal-law issue that the state supreme court actually considered and decided. ; Dun & Bradstreet, ; ; ; Moreover, that the Minnesota Supreme Court rested its holding on federal law could not be made *668 more clear than by its conclusion that "in this case enforcement of the promise of confidentiality under a promissory estoppel theory would violate defendants' First Amendment rights." It can hardly be said that there is no First Amendment issue present in the case when respondents have defended against this suit all along by arguing that the First Amendment barred the enforcement of the reporters' promises to Cohen. We proceed to consider whether that Amendment bars a promissory estoppel cause of action against respondents. The initial question we face is whether a private cause of action for promissory estoppel involves "state action" within the meaning of the Fourteenth Amendment such that the protections of the First Amendment are triggered. For if it does not, then the First Amendment has no bearing on this case. The rationale of our decision in New York Times and subsequent cases compels the conclusion that there is state action here. Our cases teach that the application of state rules of law in state courts in a manner alleged to restrict First Amendment freedoms constitutes "state action" under the Fourteenth Amendment. See, e. g., ; ; Philadelphia Newspapers, In this case, the Minnesota Supreme Court held that if Cohen could recover at all it would be on the theory of promissory estoppel, a state-law doctrine which, in the absence of a contract, creates obligations never explicitly assumed by the parties. These legal obligations would be enforced through the official power of the Minnesota courts. Under our cases, that is enough to constitute "state action" for purposes of the Fourteenth Amendment. Respondents rely on the proposition that "if a newspaper lawfully obtains truthful information about a matter of public significance then state officials may not constitutionally punish publication of the information, absent a need to further a *669 state interest of the highest order." That proposition is unexceptionable, and it has been applied in various cases that have found insufficient the asserted state interests in preventing publication of truthful, lawfully obtained information. See, e. g., Florida ; Smith v. Daily Landmark Communications, This case, however, is not controlled by this line of cases but, rather, by the equally well-established line of decisions holding that generally applicable laws do not offend the First Amendment simply because their enforcement against the press has incidental effects on its ability to gather and report the news. As the cases relied on by respondents recognize, the truthful information sought to be published must have been lawfully acquired. The press may not with impunity break and enter an office or dwelling to gather news. Neither does the First Amendment relieve a newspaper reporter of the obligation shared by all citizens to respond to a grand jury subpoena and answer questions relevant to a criminal investigation, even though the reporter might be required to reveal a confidential source. The press, like others interested in publishing, may not publish copyrighted material without obeying the copyright laws. See Similarly, the media must obey the National Labor Relations Act, Associated 301 U.S. and the Fair Labor Standards Act, Oklahoma Press Publishing ; may not restrain trade in violation of the antitrust laws, Associated ; Citizen Publishing ; and must pay nondiscriminatory taxes, ; Minneapolis Star & Tribune *670 Cf. University of It is, therefore, beyond dispute that "[t]he publisher of a newspaper has no special immunity from the application of general laws. He has no special privilege to invade the rights and liberties of others." Associated Accordingly, enforcement of such general laws against the press is not subject to stricter scrutiny than would be applied to enforcement against other persons or organizations. There can be little doubt that the Minnesota doctrine of promissory estoppel is a law of general applicability. It does not target or single out the press. Rather, insofar as we are advised, the doctrine is generally applicable to the daily transactions of all the citizens of Minnesota. The First Amendment does not forbid its application to the press. JUSTICE BLACKMUN suggests that applying Minnesota promissory estoppel doctrine in this case will "punish" respondents for publishing truthful information that was lawfully obtained. Post, at 675-676. This is not strictly accurate because compensatory damages are not a form of punishment, as were the criminal sanctions at issue in Smith v. Daily If the contract between the parties in this case had contained a liquidated damages provision, it would be perfectly clear that the payment to petitioner would represent a cost of acquiring newsworthy material to be published at a profit, rather than a punishment imposed by the State. The payment of compensatory damages in this case is constitutionally indistinguishable from a generous bonus paid to a confidential news source. In any event, as indicated above, the characterization of the payment makes no difference for First Amendment purposes when the law being applied is a general law and does not single out the press. Moreover, JUSTICE BLACKMUN'S reliance on cases like Florida and Smith v. Daily is misplaced. In those cases, the State itself defined the content of publications that would trigger liability. Here, by contrast, *671 Minnesota law simply requires those making promises to keep them. The parties themselves, as in this case, determine the scope of their legal obligations, and any restrictions that may be placed on the publication of truthful information are self-imposed. Also, it is not at all clear that respondents obtained Cohen's name "lawfully" in this case, at least for purposes of publishing it. Unlike the situation in Florida Star, where the rape victim's name was obtained through lawful access to a police report, respondents obtained Cohen's name only by making a promise that they did not honor. The dissenting opinions suggest that the press should not be subject to any law, including copyright law for example, which in any fashion or to any degree limits or restricts the press' right to report truthful information. The First Amendment does not grant the press such limitless protection. Nor is Cohen attempting to use a promissory estoppel cause of action to avoid the strict requirements for establishing a libel or defamation claim. As the Minnesota Supreme Court observed here, "Cohen could not sue for defamation because the information disclosed [his name] was true." Cohen is not seeking damages for injury to his reputation or his state of mind. He sought damages in excess of $50,000 for breach of a promise that caused him to lose his job and lowered his earning capacity. Thus, this is not a case like Hustler Magazine, where we held that the constitutional libel standards apply to a claim alleging that the publication of a parody was a state-law tort of intentional infliction of emotional distress. Respondents and amici argue that permitting Cohen to maintain a cause of action for promissory estoppel will inhibit truthful reporting because news organizations will have legal incentives not to disclose a confidential source's identity even when that person's identity is itself newsworthy. JUSTICE SOUTER makes a similar argument. But if this is the case, *672 it is no more than the incidental, and constitutionally insignificant, consequence of applying to the press a generally applicable law that requires those who make certain kinds of promises to keep them. Although we conclude that the First Amendment does not confer on the press a constitutional right to disregard promises that would otherwise be enforced under state law, we reject Cohen's request that in reversing the Minnesota Supreme Court's judgment we reinstate the jury verdict awarding him $200,000 in compensatory damages. See Brief for Petitioner 31. The Minnesota Supreme Court's incorrect conclusion that the First Amendment barred Cohen's claim may well have truncated its consideration of whether a promissory estoppel claim had otherwise been established under Minnesota law and whether Cohen's jury verdict could be upheld on a promissory estoppel basis. Or perhaps the State Constitution may be construed to shield the press from a promissory estoppel cause of action such as this one. These are matters for the Minnesota Supreme Court to address and resolve in the first instance on remand. Accordingly, the judgment of the Minnesota Supreme Court is reversed, and the case is remanded for further proceedings not inconsistent with this opinion. So ordered. |
Justice Stewart | dissenting | false | Cantor v. Detroit Edison Co. | 1976-07-06T00:00:00 | null | https://www.courtlistener.com/opinion/109542/cantor-v-detroit-edison-co/ | https://www.courtlistener.com/api/rest/v3/clusters/109542/ | 1,976 | 1975-183 | 2 | 6 | 3 | The Court today holds that a public utility company, pervasively regulated by a state utility commission, *615 may be held liable for treble damages under the Sherman Act for engaging in conduct which, under the requirements of its tariff, it is obligated to perform. I respectfully dissent from this unprecedented application of the federal antitrust laws, which will surely result in disruption of the operation of every state-regulated public utility company in the Nation and in the creation of "the prospect of massive treble damage liabilities"[1] payable ultimately by the companies' customers.
The starting point in analyzing this case is Parker v. Brown, 317 U.S. 341. While Parker did not create the "so-called state-action exemption"[2] from the federal antitrust laws,[3] it is the case that is most frequently *616 cited for the proposition that the "[Sherman] Act was intended to regulate private practices and not to prohibit a State from imposing a restraint as an act of government." Goldfarb v. Virginia State Bar, 421 U.S. 773, 788. The plurality opinion would hold that that case decided only that "the sovereign State itself," ante, at 591, could not be sued under the Sherman Act. This view of Parker, which would trivialize that case to the point of overruling it,[4] flies in the face of the decisions of *617 this Court that have interpreted or applied Parker's "state action" doctrine, and is unsupported by the sources on which the plurality relies.
As to those sources, I would have thought that except in rare instances an analysis of the positions taken by the parties in briefs submitted to this Court should play no role in interpreting its written opinions.[5] A *618 contrary rule would permit the "plain meaning" of our decisions to be qualified or even overridden by their "legislative history"i. e., briefs submitted by the contending parties. The legislative history of congressional enactments is useful in discerning legislative intent, because that history emanates from the same source as the legislation itself and is thus directly probative of the intent of the draftsmen. The conflicting views presented in the adversary briefs and arguments submitted to this Court do not bear an analogous relationship to the Court's final product.
But assuming, arguendo, that it is appropriate to look behind the language of Parker v. Brown, supra, I think it is apparent that the plurality has distorted the positions taken by the State of California and the United States as amici curiae. The question presented on reargument in Parker was "whether the state statute involved is rendered invalid by the action of Congress in passing the Sherman Act . . . ." Ante, at 587 n. 16. This phrasing indicates that the precise issue on which the Court sought reargument was whether the California statute was pre-empted by the Sherman Act, not whether sovereign States were immune from suit under the Sherman Act.
The State of California and the Solicitor General certainly understood this to be the principal issue. As the plurality opinion correctly notes, the supplemental brief filed by the State of California in response to the question posed by this Court advanced three basic arguments. And as it further notes, this Court's decision in Parker rested on the first of those arguments. But what the plurality fails to acknowledge is that California's first argument was in principal part a straightforward contention *619 that the Sherman Act was not intended to pre-empt state regulation of intrastate commerce.[6]
With respect to the amicus brief of the United States, *620 the plurality opinion states that the "Solicitor General did not take issue with the appellants' first argument." Ante, at 588. Indeed, the plurality says, the Solicitor General "expressly disclaimed any argument that the State of California or its officials had violated federal law." Ibid. In support of this assertion, the plurality opinion quotes the following language from p. 59 of the Solicitor General's brief in Parker:
" `[T]he question we face here is not whether California or its officials have violated the Sherman Act, but whether the state program interferes with the accomplishment of the objectives of the federal statute.' " Ante, at 589 n. 19.
This statement by the Solicitor General was indeed correct, because the question on which the Court had requested supplemental briefing was "whether the state statute involved is rendered invalid by the action of Congress in passing the Sherman Act," not "whether California or its officials have violated the Sherman Act. . . ." As the Solicitor General noted in the very next sentence, "[a] state law may be superseded as conflicting with a federal statute irrespective of whether its administrators are subject to prosecution for violation of the paramount federal enactment."[7] The Solicitor General then proceeded *621 to take strenuous issue with the principal contention advanced in the first part of the relevant section of California's briefthat the framers of the federal legislation had not intended to pre-empt state legislation like the California Agricultural Prorate Act.[8]
Thus, it is clear that the plurality has misread the positions taken by the State of California and the Solicitor General in Parker v. Brown. The question presented to the Court in Parker was whether the restraint on trade effected by the California statute was exempt *622 from the operation of the Sherman Act. That was the question addressed by the Solicitor General and, in principal part, by the State of California. And it was the question resolved by this Court in its holding that "[t]he state in adopting and enforcing the prorate program made no contract or agreement and entered into no conspiracy in restraint of trade or to establish monopoly but, as sovereign, imposed the restraint as an act of government which the Sherman Act did not undertake to prohibit." 317 U.S., at 352.
The notion that Parker decided only that "action taken by state officials pursuant to express legislative command did not violate the Sherman Act," ante, at 589, and that that "narrow holding . . . avoided any question about the applicability of the antitrust laws to private action" taken under command of state law, ante, at 590, is thus refuted by the very sources on which the plurality opinion relies. That narrow view of the Parker decision is also refuted by the subsequent cases in this Court that have interpreted and applied the Parker doctrine.
In Eastern R. Conf. v. Noerr Motors, 365 U.S. 127, for instance, the Court held that no violation of the Sherman Act could be predicated on the attempt by private persons to influence the passage or enforcement of state laws regulating competition in the trucking industry.[9] The Court took as its starting point the ruling in Parker v. Brown that "where a restraint upon trade or monopolization is the result of valid governmental action, as opposed to private action, no violation of the Act can be made out." 365 U.S., at 136. The Court *623 viewed it as "equally clear that the Sherman Act does not prohibit two or more persons from associating together in an attempt to persuade the legislature or the executive to take particular action with respect to a law that would produce a restraint or monopoly." Ibid. A contrary ruling, the Court held, "would substantially impair the power of government to take actions through its legislature and executive that operate to restrain trade." Id., at 137. Surely, if a rule permitting Sherman Act liability to arise from lobbying by private parties for state rules restricting competition would impair the power of state governments to impose restraints, then a fortiori a rule permitting Sherman Act liability to arise from private parties' compliance with such rules would impair the exercise of the States' power. But as the Court in Noerr correctly noted, the latter result was foreclosed by Parker's holding that "where a restraint upon trade or monopolization is the result of valid governmental action, as opposed to private action, no violation of the Act can be made out." 365 U.S., at 136.
Litigation testing the limits of the state-action exemption has focused on whether alleged anticompetitive conduct by private parties is indeed "the result of" state action. Thus, in Goldfarb v. Virginia State Bar, 421 U.S. 773, the question was whether price fixing practiced by the respondents was "required by the State acting as sovereign. Parker v. Brown, 317 U. S., at 350-352. . . ." Id., at 790. The Court held that the "so-called state-action exemption," id., at 788, did not protect the respondents because it "cannot fairly be said that the State of Virginia through its Supreme Court Rules required the anticompetitive activities of either respondent.. . . Respondents' arguments, at most, constitute the contention that their activities complemented the objective *624 of the ethical codes. In our view that is not state action for Sherman Act purposes. It is not enough that, as the County Bar puts it, anticompetitive conduct is `prompted' by state action; rather, anticompetitive activities must be compelled by direction of the State acting as a sovereign." Id., at 790-791. The plurality's view that Parker does not cover state-compelled private conduct flies in the face of this carefully drafted language in the Goldfarb opinion.
Parker, Noerr, and Goldfarb point unerringly to the proper disposition of this case. The regulatory process at issue has three principal stages. First, the utility company proposes a tariff. Second, the Michigan Public Service Commission investigates the proposed tariff and either approves it or rejects it. Third, if the tariff is approved, the utility company must, under command of state law, provide service in accord with its requirements until or unless the Commission approves a modification. The utility company thus engages in two distinct activities: It proposes a tariff and, if the tariff is approved, it obeys its terms. The first action cannot give rise to antitrust liability under Noerr and the second compliance with the terms of the tariff under the command of state lawis immune from antitrust liability under Parker and Goldfarb.[10]
*625 The plurality's contrary view would effectively overrule not only Parker but the entire body of post-Parker case law in this area, including Noerr. With the Parker holding reduced to the trivial proposition that the Sherman Act was not intended to run directly against state officials or governmental entities, the Court would fashion a new two-part test for determining whether state utility regulation creates immunity from the federal antitrust law. The first part of the test would focus on whether subjecting state-regulated utilities to antitrust liability would be "unjust." The second part of the test would look to whether the draftsmen of the Sherman Act intended to "superimpose" antitrust standards, and thus exposure to treble damages, on conduct compelled by state regulatory laws. THE CHIEF JUSTICE accedes to the new two-part test, at least where the State "purports, without any independent regulatory purpose, to control [a] utility's activities in separate, competitive *626 markets." Ante, at 604. The new immunity test thus has the approval of a majority of the Court in instances where state-compelled anticompetitive practices are deemed "ancillary" to the State's regulatory goals.[11]
With scarcely a backward glance at the Noerr case, the Court concludes that because the utility company's "participation" in the decision to incorporate the lamp-exchange program into the tariff was "sufficiently significant," there is nothing "unjust" in concluding that the company is required to conform its conduct to federal antitrust law "like comparable conduct by unregulated businesses . . . ." Ante, at 594. This attempt to distinguish between the exemptive force of mandatory state rules adopted at the behest of private parties and those adopted pursuant to the State's unilateral decision is flatly inconsistent with the rationale of Noerr. There the Court pointedly rejected "[a] construction of the Sherman Act that would disqualify people from taking a public position on matters in which they are financially interested" because such a construction "would . . . deprive the government of a valuable source of information and, at the same time, deprive the people of their right to petition in the very instances in which that right may be of the most importance to them." 365 U.S., at 139.[12]
*627 Today's holding will not only penalize the right to petition but may very well strike a crippling blow at state utility regulation. As the Court seems to acknowledge, such regulation is heavily dependent on the active participation of the regulated parties, who typically propose tariffs which are either adopted, rejected, or modified by utility commissions. But if a utility can escape the unpredictable consequences of the second arm of the Court's new test, see infra, this page, only by playing possum by exercising no "option" in the Court's terminology, ante, at 594then it will surely be tempted to do just that, posing a serious threat to efficient and effective regulation.
The second arm of the Court's new immunity test, which apparently comes into play only if the utility's own activity does not exceed a vaguely defined threshold of "sufficient freedom of choice," purports to be aimed at answering the basic question of whether "Congress intended to superimpose antitrust standards on conduct already being regulated" by state utility regulation laws. Ante, at 595. Yet analysis of the Court's opinion reveals that the three factors to which the Court pays heed have little or nothing to do with discerning congressional intent. Rather, the second arm of the new test simply creates a vehicle for ad hoc judicial determinations of the substantive validity of state regulatory goals, which closely resembles the discarded doctrine of substantive due process. See Ferguson v. Skrupa, 372 U.S. 726.
The Court's delineation of the second arm of the new test proceeds as follows. Apart from the "fairness" question, the Court states, there are "at least three reasons" why the light-bulb program should not enjoy Sherman Act immunity. Ante, at 595. "First," the Court observes, "merely because certain conduct may be subject both to state regulation and to the federal antitrust laws does not necessarily mean that it must satisfy *628 inconsistent standards. . . ." Ibid. That is true enough as an abstract proposition, but the very question is whether the utility's alleged "tie" of light-bulb sales to the provision of electric service is immune from antitrust liability, assuming it would constitute an antitrust violation in the absence of regulation.[13] Second, the Court states, "even assuming inconsistency, we could not accept the view that the federal interest must inevitably be subordinated to the State's . . . ." Ibid. The Court goes on to amplify this rationale as follows:
"The mere possibility of conflict between state regulatory policy and federal antitrust policy is an insufficient basis for implying an exemption from the federal antitrust laws. Congress could hardly have intended state regulatory agencies to have broader power than federal agencies to exempt private conduct from the antitrust laws. Therefore, *629 assuming that there are situations in which the existence of state regulation should give rise to an implied exemption, the standards for ascertaining the existence and scope of such an exemption surely must be at least as severe as those applied to federal regulatory legislation.
"The Court has consistently refused to find that regulation gave rise to an implied exemption without first determining that exemption was necessary in order to make the regulatory act work, `and even then only to the minimum extent necessary.'
"The application of that standard to this case inexorably requires rejection of respondent's claim." Ante, at 596-598 (footnotes omitted).
The Court's analysis rests on a mistaken premise. The "implied immunity" doctrine employed by this Court to reconcile the federal antitrust laws and federal regulatory statutes cannot, rationally, be put to the use for which the Court would employ it. That doctrine, a species of the basic rule that repeals by implication are disfavored, comes into play only when two arguably inconsistent federal statutes are involved. " `Implied repeal' " of federal antitrust laws by inconsistent state regulatory statutes is not only " `not favored,' " ante, at 597-598, n. 37, it is impossible. See U. S. Const., Art. VI, cl. 2.
A closer scrutiny of the Court's holding reveals that its reference to the inapposite "implied repeal" doctrine is simply window dressing for a type of judicial review radically different from that engaged in by this Court in Gordon v. New York Stock Exchange, 422 U.S. 659, and United States v. Philadelphia National Bank, 374 U.S. 321. Those cases turned exclusively on issues of statutory construction and involved no judicial scrutiny of the abstract "necessity" or "centrality" of particular *630 regulatory provisions. Instead, the federal regulatory statute was accepted as a given, as was the federal antitrust law. The Court's interpretative effort was aimed at accommodating these arguably inconsistent bodies of law, not at second-guessing legislative judgments concerning the "necessity" for including particular provisions in the regulatory statute.
The Court's approach here is qualitatively different. The State of Michigan, through its Public Service Commission, has decided that requiring Detroit Edison to provide "free" light bulbs as a term and condition of service is in the public interest. Yet the Court is prepared to set aside that policy determination: "The lamp-supply program is by no means . . . imperative in the continued effective functioning of Michigan's regulation of the utilities industry." Ante, at 597 n. 36 (emphasis added). Even "if the federal antitrust laws should be construed to outlaw respondent's light-bulb-exchange program, there is no reason to believe that Michigan's regulation of its electric utilities will no longer be able to function effectively. Regardless of the outcome of this case, Michigan's interest in regulating its utilities' distribution of electricity will be almost entirely unimpaired." Ante, at 598 (emphasis added).
The emphasized language in these passages shows that the Court is adopting an interpretation of the Sherman Act which will allow the federal judiciary to substitute its judgment for that of state legislatures and administrative agencies with respect to whether particular anticompetitive regulatory provisions are " `sufficiently central.' " ante, at 597 n. 37, to a judicial conception of the proper scope of state utility regulation. The content of those " `purposes,' " ibid., which the Court will suffer the States to promote derives presumably from the mandate of the Sherman Act. On this assumption and no other is plausibleit becomes apparent *631 that the Court's second reason for extending the Sherman Act to cover the light-bulb program, when divested of inapposite references to the federal implied repeal doctrine, is merely a restatement of the third rationale, which the Court phrases as follows: "[F]inally, even if we were to assume that Congress did not intend the antitrust laws to apply to areas of the economy primarily regulated by a State, that assumption would not foreclose the enforcement of the antitrust laws in an essentially unregulated area such as the market for electric light bulbs." Ante, at 595. This statement raises at last the only legitimate question, which is whether Parker erred in holding that Congress, in enacting the Sherman Act, did not intend to vitiate state regulation of the sort at issue here by creating treble-damages exposure for activities performed in compliance therewith.
The Court's rationale appears to be that the draftsmen of the Sherman Act intended to exempt state-regulated utilities from treble damages only to the extent those utilities are complying with state rules which narrowly reflect the "typica[l] assum[ption] that the [utility] is a natural monopoly" and which regulate the utility's "natural monopoly powers" as opposed to its "business activity in competitive areas of the economy." Ante, at 595-596 (footnotes omitted). Furthermore, such regulation must be " `sufficiently central' " to the regulation of natural monopoly powers if it is to shield the regulated party from antitrust liability. Ante, at 597 n. 37. This Delphic reading of the Sherman Act, which is unaided by any reference to the language or legislative history of that Act, is, of course, inconsistent with Parker v. Brown. Parker involved a state scheme aimed at artificially raising the market price of raisins. Raisin production is not a "natural monopoly." If the limits of *632 the state-action exemption from the Sherman Act are congruent with the boundaries of "natural monopoly" power, then Parker was wrongly decided.
But the legislative history of the Sherman Act shows conclusively that Parker was correctly decided. The floor debates and the House Report on the proposed legislation clearly reveal, as at least one commentator has noted, that "Congress fully understood the narrow scope given to the commerce clause" in 1890.[14] This understanding is, in many ways, of historic interest only, because subsequent decisions of this Court have "permitted the reach of the Sherman Act to expand along with expanding notions of congressional power."[15] But the narrow view taken by the Members of Congress in 1890 remains relevant for the limited purpose of assessing their intention regarding the interaction of the Sherman Act and state economic regulation.
The legislative history reveals very clearly that Congress' perception of the limitations of its power under the Commerce Clause was coupled with an intent not to intrude upon the authority of the several States to regulate "domestic" commerce. As the House Report stated:
"It will be observed that the provisions of the bill are carefully confined to such subjects of legislation as are clearly within the legislative authority of Congress.
"No attempt is made to invade the legislative authority *633 of the several States or even to occupy doubtful grounds. No system of laws can be devised by Congress alone which would effectually protect the people of the United States against the evils and oppression of trusts and monopolies. Congress has no authority to deal, generally, with the subject within the States, and the States have no authority to legislate in respect of commerce between the several States or with foreign nations.
"It follows, therefore, that the legislative authority of Congress and that of the several States must be exerted to secure the suppression of restraints upon trade and monopolies. Whatever legislation Congress may enact on this subject, within the limits of its authority, will prove of little value unless the States shall supplement it by such auxiliary and proper legislation as may be within their legislative authority."[16]
Similarly, the floor debates on the proposed legislation reveal an intent to "g[o] as far as the Constitution permits Congress to go,"[17] in the words of Senator Sherman, conjoined with an intent not to "interfere with" state-law efforts to "prevent and control combinations within the limit of the State."[18] Far from demonstrating an intent to pre-empt state laws aimed at preventing or controlling combinations or monopolies, the legislative debates show that Congress' goal was to supplement such state efforts, themselves restricted to the geographic boundaries of the several States. As Senator Sherman stated: "Each State can deal with a combination within the State, but only the General Government can deal *634 with combinations reaching not only the several States, but the commercial world. This bill does not include combinations within a State . . . ."[19] Indeed a pre-existing body of state law forbidding combinations in restraint of trade provided the model for the federal Act. As Senator Sherman stated with respect to the proposed legislation: "It declares that certain contracts are against public policy, null and void. It does not announce a new principle of law, but applies old and well-recognized principles of the common law to the complicated jurisdiction of our State and Federal Government. Similar contracts in any State in the Union are now, by common or statute law, null and void."[20]
It is noteworthy that the body of state jurisprudence which formed the model for the Sherman Act coexisted with state laws permitting regulated industries to operate under governmental control in the public interest. Indeed, state regulatory laws long antedated the passage of the Sherman Act and had, prior to its passage, been upheld by this Court against constitutional attack.[21] Such laws were an integral part of state efforts to regulate *635 competition to which Congress turned for guidance in barring restraints of interstate commerce, and it is clear that those laws were left undisturbed by the passage of the Sherman Act in 1890. For, as congressional spokesmen expressly stated, there was no intent to "interfere with" state laws regulating domestic commerce or "invade the legislative authority of the several States. . . ."
As previously noted, the intent of the draftsmen of the Sherman Act not to intrude on the sovereignty of the States was coupled with a full and precise understanding of the narrow scope of congressional power under the Commerce Clause, as it was then interpreted by decisions of this Court. Subsequent decisions of the Court, however, have permitted the "jurisdictional" reach of the Sherman Act to expand along with an expanding view of the commerce power of Congress. See Hospital Building Co. v. Rex Hospital Trustees, 425 U.S. 738, 743 n. 2, and cases cited therein. These decisions, based on a determination that Congress intended to exercise all the power it possessed when it enacted the Sherman Act,[22] have in effect allowed the Congress of 1890 the retroactive benefit of an enlarged judicial conception of the commerce power.[23]
It was this retroactive expansion of the jurisdictional reach of the Sherman Act that was in large part responsible for the advent of the Parker doctrine. Parker involved a program regulating the production of raisins *636 within the State of California. Under the original understanding of the draftsmen of the Sherman Act, such in-state production, like in-state manufacturing, would not have been subject to the regulatory power of Congress under the Commerce Clause and thus not within the "jurisdictional" reach of the Sherman Act. See United States v. E. C. Knight Co., 156 U.S. 1. If the state of the law had remained static, the Parker problem would rarely, if ever, have arisen. As stated in Northern Securities Co. v. United States, 193 U.S. 197, the operative premise would have been that the "Anti-Trust Act . . . prescribe[d] . . . a rule for interstate and international commerce, (not for domestic commerce,)" id., at 337. The relevant question would have been whether the anticompetitive conduct required or permitted by the state statute was in restraint of domestic or interstate commerce. If the former, the conduct would have been beyond the reach of the Sherman Act; if the latter, the conduct would probably have violated the Sherman Act, regardless of contrary state law, on the theory that "[n]o State can, by . . . any . . . mode, project its authority into other States, and across the continent, so as to prevent Congress from exerting the power it possesses under the Constitution over interstate and international commerce, or . . . to exempt its corporation engaged in interstate commerce from obedience to any rule lawfully established by Congress for such commerce." Id., at 345-346.
But the law did not remain static. As one commentator has put it: "By 1942, when Parker v. Brown was decided, the interpretation and scope of the commerce clause had changed substantially. With the development of the `affection doctrine' purely intrastate events"like state-mandated anticompetitive arrangements with respect to in-state agricultural production or in-state provision of utility services"could be regulated *637 under the commerce clause if these events had the requisite impact on interstate commerce."[24] This development created a potential for serious conflict between state statutes regulating commerce which, in 1890, would have been considered "domestic" but which, in 1942, were viewed as falling within the jurisdictional reach of the Sherman Act. To have held that state statutes requiring anticompetitive arrangements with respect to such commerce were pre-empted by the Sherman Act would, in effect, have transformed a generous principle of judicial constructionnamely the "retroactive" expansion of the jurisdictional reach of the Sherman Act to the limits of an expanded judicial conception of the commerce powerinto a transgression of the clearly expressed congressional intent not to intrude on the regulatory authority of the States.
The "state action" doctrine of Parker v. Brown, as clarified by Goldfarb, represents the best possible accommodation of this limiting intent and the post-1890 judicial expansion of the jurisdictional reach of the Sherman Act. Parker's basic holdingthat the Sherman Act did not intend to displace restraints imposed by the State acting as sovereigncoincides with the expressed legislative goal not to "invade the legislative authority of the several States . . . ." Goldfarb clarified Parker by holding that private conduct, if it is to come within the state-action exemption, must be not merely "prompted" but "compelled" by state action. Thus refined, the doctrine performs the salutary function of isolating those areas of state regulation where the State's sovereign interest is, by the State's own judgment, at its strongest, and limits the exemption to those areas.[25]
*638 Beyond this the Court cannot go without disregarding the purpose of the Sherman Act not to disrupt state regulatory laws.[26] Congress, of course, can alter its *639 original intent and expand or contract the categories of state law which may permissibly impose restraints on competition. For example, in 1937 Congress passed the Miller-Tydings Act which attached a proviso to § 1 of the Sherman Act permitting resale price maintenance contracts where such contracts were permitted by applicable state law. This proviso was interpreted in Schwegmann Bros. v. Calvert Distillers Corp., 341 U.S. 384, not to permit a State to enforce a law providing that all retailers within a State were bound by a resale price maintenance contract executed by any one retailer in the State. As the Court today notes, Parkerand the legislative judgment embodied in the 1890 version of the Sherman Actwould, standing alone, have seemed to immunize the state scheme. Ante, at 593. But Congress was thought to have struck a new balance in 1937 with respect to a specific category of state-imposed restraints. Accordingly, the Court in Schwegmann determined congressional intent concerning the permissible limits of state restraints with respect to resale price maintenance by reference to the later, and more specific, expression of congressional purpose.[27]
*640 There has been no analogous alteration of the original intent regarding the area of state regulation at issue here. Indeed, to the extent subsequent congressional action is probative at all, it shows a continuing intent to defer to the regulatory authority of the States over the terms and conditions of in-state electric utility service. Thus, § 201 (a) of the Federal Power Act, 16 U.S. C. § 824 (a), provides in relevant part that "Federal regulation. . . [is] to extend only to those matters which are not subject to regulation by the States."
The Court's opinion simply ignores the clear evidence of congressional intent and substitutes its own policy judgment about the desirability of disregarding any facet of state economic regulation that it thinks unwise or of no great importance. In adopting this freewheeling approach to the language of the Sherman Act the Court creates a statutory simulacrum of the substantive due process doctrine I thought had been put to rest long ago. See Ferguson v. Skrupa, 372 U.S. 726.[28] For the Court's approach contemplates the selective interdiction of those anticompetitive state regulatory measures that are deemed not "central" to the limited range of regulatory goals considered "imperative" by the federal judiciary.
Henceforth, a state-regulated public utility company must at its peril successfully divine which of its countless and interrelated tariff provisions a federal court will ultimately consider "central" or "imperative." If it guesses wrong, it may be subjected to treble damages as a penalty for its compliance with state law.
| The Court today holds that a public utility company, pervasively regulated by a state utility commission, *615 may be held liable for treble damages under the Sherman Act for engaging in conduct which, under the requirements of its tariff, it is obligated to perform. I respectfully dissent from this unprecedented application of the federal antitrust laws, which will surely result in disruption of the operation of every state-regulated public utility company in the Nation and in the creation of "the prospect of massive treble damage liabilities"[1] payable ultimately by the companies' customers. The starting point in analyzing this case is While Parker did not create the "so-called state-action exemption"[2] from the federal antitrust laws,[3] it is the case that is most frequently *616 cited for the proposition that the "[Sherman] Act was intended to regulate private practices and not to prohibit a State from imposing a restraint as an act of government." The plurality opinion would hold that that case decided only that "the sovereign State itself," ante, at 591, could not be sued under the Sherman Act. This view of Parker, which would trivialize that case to the point of overruling it,[4] flies in the face of the decisions of *617 this Court that have interpreted or applied Parker's "state action" doctrine, and is unsupported by the sources on which the plurality relies. As to those sources, I would have thought that except in rare instances an analysis of the positions taken by the parties in briefs submitted to this Court should play no role in interpreting its written opinions.[5] A *618 contrary rule would permit the "plain meaning" of our decisions to be qualified or even overridden by their "legislative history"i. e., briefs submitted by the contending parties. The legislative history of congressional enactments is useful in discerning legislative intent, because that history emanates from the same source as the legislation itself and is thus directly probative of the intent of the draftsmen. The conflicting views presented in the adversary briefs and arguments submitted to this Court do not bear an analogous relationship to the Court's final product. But assuming, arguendo, that it is appropriate to look behind the language of I think it is apparent that the plurality has distorted the positions taken by the State of California and the United States as amici curiae. The question presented on reargument in Parker was "whether the state statute involved is rendered invalid by the action of Congress in passing the Sherman Act" Ante, at 587 n. 16. This phrasing indicates that the precise issue on which the Court sought reargument was whether the California statute was pre-empted by the Sherman Act, not whether sovereign States were immune from suit under the Sherman Act. The State of California and the Solicitor General certainly understood this to be the principal issue. As the plurality opinion correctly notes, the supplemental brief filed by the State of California in response to the question posed by this Court advanced three basic arguments. And as it further notes, this Court's decision in Parker rested on the first of those arguments. But what the plurality fails to acknowledge is that California's first argument was in principal part a straightforward contention *619 that the Sherman Act was not intended to pre-empt state regulation of intrastate commerce.[6] With respect to the amicus brief of the United States, *620 the plurality opinion states that the "Solicitor General did not take issue with the appellants' first argument." Ante, at 588. Indeed, the plurality says, the Solicitor General "expressly disclaimed any argument that the State of California or its officials had violated federal law." In support of this assertion, the plurality opinion quotes the following language from p. 59 of the Solicitor General's brief in Parker: " `[T]he question we face here is not whether California or its officials have violated the Sherman Act, but whether the state program interferes with the accomplishment of the objectives of the federal statute.' " Ante, at 589 n. 19. This statement by the Solicitor General was indeed correct, because the question on which the Court had requested supplemental briefing was "whether the state statute involved is rendered invalid by the action of Congress in passing the Sherman Act," not "whether California or its officials have violated the Sherman Act." As the Solicitor General noted in the very next sentence, "[a] state law may be superseded as conflicting with a federal statute irrespective of whether its administrators are subject to prosecution for violation of the paramount federal enactment."[7] The Solicitor General then proceeded *621 to take strenuous issue with the principal contention advanced in the first part of the relevant section of California's briefthat the framers of the federal legislation had not intended to pre-empt state legislation like the California Agricultural Prorate Act.[8] Thus, it is clear that the plurality has misread the positions taken by the State of California and the Solicitor General in The question presented to the Court in Parker was whether the restraint on trade effected by the California statute was exempt *622 from the operation of the Sherman Act. That was the question addressed by the Solicitor General and, in principal part, by the State of California. And it was the question resolved by this Court in its holding that "[t]he state in adopting and enforcing the prorate program made no contract or agreement and entered into no conspiracy in restraint of trade or to establish monopoly but, as sovereign, imposed the restraint as an act of government which the Sherman Act did not undertake to prohibit." The notion that Parker decided only that "action taken by state officials pursuant to express legislative command did not violate the Sherman Act," ante, at 589, and that that "narrow holding avoided any question about the applicability of the antitrust laws to private action" taken under command of state law, ante, at 590, is thus refuted by the very sources on which the plurality opinion relies. That narrow view of the Parker decision is also refuted by the subsequent cases in this Court that have interpreted and applied the Parker doctrine. In Eastern R. for instance, the Court held that no violation of the Sherman Act could be predicated on the attempt by private persons to influence the passage or enforcement of state laws regulating competition in the trucking industry.[9] The Court took as its starting point the ruling in that "where a restraint upon trade or monopolization is the result of valid governmental action, as opposed to private action, no violation of the Act can be made out." The Court *623 viewed it as "equally clear that the Sherman Act does not prohibit two or more persons from associating together in an attempt to persuade the legislature or the executive to take particular action with respect to a law that would produce a restraint or monopoly." A contrary ruling, the Court held, "would substantially impair the power of government to take actions through its legislature and executive that operate to restrain trade." Surely, if a rule permitting Sherman Act liability to arise from lobbying by private parties for state rules restricting competition would impair the power of state governments to impose restraints, then a fortiori a rule permitting Sherman Act liability to arise from private parties' compliance with such rules would impair the exercise of the States' power. But as the Court in Noerr correctly noted, the latter result was foreclosed by Parker's holding that "where a restraint upon trade or monopolization is the result of valid governmental action, as opposed to private action, no violation of the Act can be made out." Litigation testing the limits of the state-action exemption has focused on whether alleged anticompetitive conduct by private parties is indeed "the result of" state action. Thus, in the question was whether price fixing practiced by the respondents was "required by the State acting as sovereign. -352." The Court held that the "so-called state-action exemption," at did not protect the respondents because it "cannot fairly be said that the State of Virginia through its Supreme Court Rules required the anticompetitive activities of either respondent. Respondents' arguments, at most, constitute the contention that their activities complemented the objective *624 of the ethical codes. In our view that is not state action for Sherman Act purposes. It is not enough that, as the County Bar puts it, anticompetitive conduct is `prompted' by state action; rather, anticompetitive activities must be compelled by direction of the State acting as a sovereign." -791. The plurality's view that Parker does not cover state-compelled private conduct flies in the face of this carefully drafted language in the Goldfarb opinion. Parker, Noerr, and Goldfarb point unerringly to the proper disposition of this case. The regulatory process at issue has three principal stages. First, the utility company proposes a tariff. Second, the Michigan Public Service Commission investigates the proposed tariff and either approves it or rejects it. Third, if the tariff is approved, the utility company must, under command of state law, provide service in accord with its requirements until or unless the Commission approves a modification. The utility company thus engages in two distinct activities: It proposes a tariff and, if the tariff is approved, it obeys its terms. The first action cannot give rise to antitrust liability under Noerr and the second compliance with the terms of the tariff under the command of state lawis immune from antitrust liability under Parker and Goldfarb.[10] *625 The plurality's contrary view would effectively overrule not only Parker but the entire body of post-Parker case law in this area, including Noerr. With the Parker holding reduced to the trivial proposition that the Sherman Act was not intended to run directly against state officials or governmental entities, the Court would fashion a new two-part test for determining whether state utility regulation creates immunity from the federal antitrust law. The first part of the test would focus on whether subjecting state-regulated utilities to antitrust liability would be "unjust." The second part of the test would look to whether the draftsmen of the Sherman Act intended to "superimpose" antitrust standards, and thus exposure to treble damages, on conduct compelled by state regulatory laws. THE CHIEF JUSTICE accedes to the new two-part test, at least where the State "purports, without any independent regulatory purpose, to control [a] utility's activities in separate, competitive *626 markets." Ante, at 604. The new immunity test thus has the approval of a majority of the Court in instances where state-compelled anticompetitive practices are deemed "ancillary" to the State's regulatory goals.[11] With scarcely a backward glance at the Noerr case, the Court concludes that because the utility company's "participation" in the decision to incorporate the lamp-exchange program into the tariff was "sufficiently significant," there is nothing "unjust" in concluding that the company is required to conform its conduct to federal antitrust law "like comparable conduct by unregulated businesses" Ante, at 594. This attempt to distinguish between the exemptive force of mandatory state rules adopted at the behest of private parties and those adopted pursuant to the State's unilateral decision is flatly inconsistent with the rationale of Noerr. There the Court pointedly rejected "[a] construction of the Sherman Act that would disqualify people from taking a public position on matters in which they are financially interested" because such a construction "would deprive the government of a valuable source of information and, at the same time, deprive the people of their right to petition in the very instances in which that right may be of the most importance to them."[12] *627 Today's holding will not only penalize the right to petition but may very well strike a crippling blow at state utility regulation. As the Court seems to acknowledge, such regulation is heavily dependent on the active participation of the regulated parties, who typically propose tariffs which are either adopted, rejected, or modified by utility commissions. But if a utility can escape the unpredictable consequences of the second arm of the Court's new test, see infra, this page, only by playing possum by exercising no "option" in the Court's terminology, ante, at 594then it will surely be tempted to do just that, posing a serious threat to efficient and effective regulation. The second arm of the Court's new immunity test, which apparently comes into play only if the utility's own activity does not exceed a vaguely defined threshold of "sufficient freedom of choice," purports to be aimed at answering the basic question of whether "Congress intended to superimpose antitrust standards on conduct already being regulated" by state utility regulation laws. Ante, at 595. Yet analysis of the Court's opinion reveals that the three factors to which the Court pays heed have little or nothing to do with discerning congressional intent. Rather, the second arm of the new test simply creates a vehicle for ad hoc judicial determinations of the substantive validity of state regulatory goals, which closely resembles the discarded doctrine of substantive due process. See The Court's delineation of the second arm of the new test proceeds as follows. Apart from the "fairness" question, the Court states, there are "at least three reasons" why the light-bulb program should not enjoy Sherman Act immunity. Ante, at 595. "First," the Court observes, "merely because certain conduct may be subject both to state regulation and to the federal antitrust laws does not necessarily mean that it must satisfy *628 inconsistent standards." That is true enough as an abstract proposition, but the very question is whether the utility's alleged "tie" of light-bulb sales to the provision of electric service is immune from antitrust liability, assuming it would constitute an antitrust violation in the absence of regulation.[13] Second, the Court states, "even assuming inconsistency, we could not accept the view that the federal interest must inevitably be subordinated to the State's" The Court goes on to amplify this rationale as follows: "The mere possibility of conflict between state regulatory policy and federal antitrust policy is an insufficient basis for implying an exemption from the federal antitrust laws. Congress could hardly have intended state regulatory agencies to have broader power than federal agencies to exempt private conduct from the antitrust laws. Therefore, *629 assuming that there are situations in which the existence of state regulation should give rise to an implied exemption, the standards for ascertaining the existence and scope of such an exemption surely must be at least as severe as those applied to federal regulatory legislation. "The Court has consistently refused to find that regulation gave rise to an implied exemption without first determining that exemption was necessary in order to make the regulatory act work, `and even then only to the minimum extent necessary.' "The application of that standard to this case inexorably requires rejection of respondent's claim." Ante, at 596-598 (footnotes omitted). The Court's analysis rests on a mistaken premise. The "implied immunity" doctrine employed by this Court to reconcile the federal antitrust laws and federal regulatory statutes cannot, rationally, be put to the use for which the Court would employ it. That doctrine, a species of the basic rule that repeals by implication are disfavored, comes into play only when two arguably inconsistent federal statutes are involved. " `Implied repeal' " of federal antitrust laws by inconsistent state regulatory statutes is not only " `not favored,' " ante, at 597-598, n. 37, it is impossible. See U. S. Const., Art. VI, cl. 2. A closer scrutiny of the Court's holding reveals that its reference to the inapposite "implied repeal" doctrine is simply window dressing for a type of judicial review radically different from that engaged in by this Court in and United Those cases turned exclusively on issues of statutory construction and involved no judicial scrutiny of the abstract "necessity" or "centrality" of particular *630 regulatory provisions. Instead, the federal regulatory statute was accepted as a given, as was the federal antitrust law. The Court's interpretative effort was aimed at accommodating these arguably inconsistent bodies of law, not at second-guessing legislative judgments concerning the "necessity" for including particular provisions in the regulatory statute. The Court's approach here is qualitatively different. The State of Michigan, through its Public Service Commission, has decided that requiring Detroit Edison to provide "free" light bulbs as a term and condition of service is in the public interest. Yet the Court is prepared to set aside that policy determination: "The lamp-supply program is by no means imperative in the continued effective functioning of Michigan's regulation of the utilities industry." Ante, at 597 n. 36 (emphasis added). Even "if the federal antitrust laws should be construed to outlaw respondent's light-bulb-exchange program, there is no reason to believe that Michigan's regulation of its electric utilities will no longer be able to function effectively. Regardless of the outcome of this case, Michigan's interest in regulating its utilities' distribution of electricity will be almost entirely unimpaired." Ante, at 598 (emphasis added). The emphasized language in these passages shows that the Court is adopting an interpretation of the Sherman Act which will allow the federal judiciary to substitute its judgment for that of state legislatures and administrative agencies with respect to whether particular anticompetitive regulatory provisions are " `sufficiently central.' " ante, at 597 n. 37, to a judicial conception of the proper scope of state utility regulation. The content of those " `purposes,' " ib which the Court will suffer the States to promote derives presumably from the mandate of the Sherman Act. On this assumption and no other is plausibleit becomes apparent *631 that the Court's second reason for extending the Sherman Act to cover the light-bulb program, when divested of inapposite references to the federal implied repeal doctrine, is merely a restatement of the third rationale, which the Court phrases as follows: "[F]inally, even if we were to assume that Congress did not intend the antitrust laws to apply to areas of the economy primarily regulated by a State, that assumption would not foreclose the enforcement of the antitrust laws in an essentially unregulated area such as the market for electric light bulbs." Ante, at 595. This statement raises at last the only legitimate question, which is whether Parker erred in holding that Congress, in enacting the Sherman Act, did not intend to vitiate state regulation of the sort at issue here by creating treble-damages exposure for activities performed in compliance therewith. The Court's rationale appears to be that the draftsmen of the Sherman Act intended to exempt state-regulated utilities from treble damages only to the extent those utilities are complying with state rules which narrowly reflect the "typica[l] assum[ption] that the [utility] is a natural monopoly" and which regulate the utility's "natural monopoly powers" as opposed to its "business activity in competitive areas of the economy." Ante, at 595-596 (footnotes omitted). Furthermore, such regulation must be " `sufficiently central' " to the regulation of natural monopoly powers if it is to shield the regulated party from antitrust liability. Ante, at 597 n. 37. This Delphic reading of the Sherman Act, which is unaided by any reference to the language or legislative history of that Act, is, of course, inconsistent with Parker involved a state scheme aimed at artificially raising the market price of raisins. Raisin production is not a "natural monopoly." If the limits of *632 the state-action exemption from the Sherman Act are congruent with the boundaries of "natural monopoly" power, then Parker was wrongly decided. But the legislative history of the Sherman Act shows conclusively that Parker was correctly decided. The floor debates and the House Report on the proposed legislation clearly reveal, as at least one commentator has noted, that "Congress fully understood the narrow scope given to the commerce clause" in 1890.[14] This understanding is, in many ways, of historic interest only, because subsequent decisions of this Court have "permitted the reach of the Sherman Act to expand along with expanding notions of congressional power."[15] But the narrow view taken by the Members of Congress in 1890 remains relevant for the limited purpose of assessing their intention regarding the interaction of the Sherman Act and state economic regulation. The legislative history reveals very clearly that Congress' perception of the limitations of its power under the Commerce Clause was coupled with an intent not to intrude upon the authority of the several States to regulate "domestic" commerce. As the House Report stated: "It will be observed that the provisions of the bill are carefully confined to such subjects of legislation as are clearly within the legislative authority of Congress. "No attempt is made to invade the legislative authority *633 of the several States or even to occupy doubtful grounds. No system of laws can be devised by Congress alone which would effectually protect the people of the United States against the evils and oppression of trusts and monopolies. Congress has no authority to deal, generally, with the subject within the States, and the States have no authority to legislate in respect of commerce between the several States or with foreign nations. "It follows, therefore, that the legislative authority of Congress and that of the several States must be exerted to secure the suppression of restraints upon trade and monopolies. Whatever legislation Congress may enact on this subject, within the limits of its authority, will prove of little value unless the States shall supplement it by such auxiliary and proper legislation as may be within their legislative authority."[16] Similarly, the floor debates on the proposed legislation reveal an intent to "g[o] as far as the Constitution permits Congress to go,"[17] in the words of Senator Sherman, conjoined with an intent not to "interfere with" state-law efforts to "prevent and control combinations within the limit of the State."[18] Far from demonstrating an intent to pre-empt state laws aimed at preventing or controlling combinations or monopolies, the legislative debates show that Congress' goal was to supplement such state efforts, themselves restricted to the geographic boundaries of the several States. As Senator Sherman stated: "Each State can deal with a combination within the State, but only the General Government can deal *634 with combinations reaching not only the several States, but the commercial world. This bill does not include combinations within a State"[19] Indeed a pre-existing body of state law forbidding combinations in restraint of trade provided the model for the federal Act. As Senator Sherman stated with respect to the proposed legislation: "It declares that certain contracts are against public policy, null and void. It does not announce a new principle of law, but applies old and well-recognized principles of the common law to the complicated jurisdiction of our State and Federal Government. Similar contracts in any State in the Union are now, by common or statute law, null and void."[20] It is noteworthy that the body of state jurisprudence which formed the model for the Sherman Act coexisted with state laws permitting regulated industries to operate under governmental control in the public interest. Indeed, state regulatory laws long antedated the passage of the Sherman Act and had, prior to its passage, been upheld by this Court against constitutional attack.[21] Such laws were an integral part of state efforts to regulate *635 competition to which Congress turned for guidance in barring restraints of interstate commerce, and it is clear that those laws were left undisturbed by the passage of the Sherman Act in 1890. For, as congressional spokesmen expressly stated, there was no intent to "interfere with" state laws regulating domestic commerce or "invade the legislative authority of the several States." As previously noted, the intent of the draftsmen of the Sherman Act not to intrude on the sovereignty of the States was coupled with a full and precise understanding of the narrow scope of congressional power under the Commerce Clause, as it was then interpreted by decisions of this Court. Subsequent decisions of the Court, however, have permitted the "jurisdictional" reach of the Sherman Act to expand along with an expanding view of the commerce power of Congress. See Hospital Building 743 n. 2, and cases cited therein. These decisions, based on a determination that Congress intended to exercise all the power it possessed when it enacted the Sherman Act,[22] have in effect allowed the Congress of 1890 the retroactive benefit of an enlarged judicial conception of the commerce power.[23] It was this retroactive expansion of the jurisdictional reach of the Sherman Act that was in large part responsible for the advent of the Parker doctrine. Parker involved a program regulating the production of raisins *636 within the State of California. Under the original understanding of the draftsmen of the Sherman Act, such in-state production, like in-state manufacturing, would not have been subject to the regulatory power of Congress under the Commerce Clause and thus not within the "jurisdictional" reach of the Sherman Act. See United If the state of the law had remained static, the Parker problem would rarely, if ever, have arisen. As stated in Northern Securities the operative premise would have been that the "Anti-Trust Act prescribe[d] a rule for interstate and international commerce, (not for domestic commerce,)" The relevant question would have been whether the anticompetitive conduct required or permitted by the state statute was in restraint of domestic or interstate commerce. If the former, the conduct would have been beyond the reach of the Sherman Act; if the latter, the conduct would probably have violated the Sherman Act, regardless of contrary state law, on the theory that "[n]o State can, by any mode, project its authority into other States, and across the continent, so as to prevent Congress from exerting the power it possesses under the Constitution over interstate and international commerce, or to exempt its corporation engaged in interstate commerce from obedience to any rule lawfully established by Congress for such commerce." But the law did not remain static. As one commentator has put it: "By 1942, when was decided, the interpretation and scope of the commerce clause had changed substantially. With the development of the `affection doctrine' purely intrastate events"like state-mandated anticompetitive arrangements with respect to in-state agricultural production or in-state provision of utility services"could be regulated *637 under the commerce clause if these events had the requisite impact on interstate commerce."[24] This development created a potential for serious conflict between state statutes regulating commerce which, in 1890, would have been considered "domestic" but which, in 1942, were viewed as falling within the jurisdictional reach of the Sherman Act. To have held that state statutes requiring anticompetitive arrangements with respect to such commerce were pre-empted by the Sherman Act would, in effect, have transformed a generous principle of judicial constructionnamely the "retroactive" expansion of the jurisdictional reach of the Sherman Act to the limits of an expanded judicial conception of the commerce powerinto a transgression of the clearly expressed congressional intent not to intrude on the regulatory authority of the States. The "state action" doctrine of as clarified by Goldfarb, represents the best possible accommodation of this limiting intent and the post-1890 judicial expansion of the jurisdictional reach of the Sherman Act. Parker's basic holdingthat the Sherman Act did not intend to displace restraints imposed by the State acting as sovereigncoincides with the expressed legislative goal not to "invade the legislative authority of the several States" Goldfarb clarified Parker by holding that private conduct, if it is to come within the state-action exemption, must be not merely "prompted" but "compelled" by state action. Thus refined, the doctrine performs the salutary function of isolating those areas of state regulation where the State's sovereign interest is, by the State's own judgment, at its strongest, and limits the exemption to those areas.[25] *638 Beyond this the Court cannot go without disregarding the purpose of the Sherman Act not to disrupt state regulatory laws.[26] Congress, of course, can alter its *639 original intent and expand or contract the categories of state law which may permissibly impose restraints on competition. For example, in 1937 Congress passed the Miller-Tydings Act which attached a proviso to 1 of the Sherman Act permitting resale price maintenance contracts where such contracts were permitted by applicable state law. This proviso was interpreted in Schwegmann not to permit a State to enforce a law providing that all retailers within a State were bound by a resale price maintenance contract executed by any one retailer in the State. As the Court today notes, Parkerand the legislative judgment embodied in the 1890 version of the Sherman Actwould, standing alone, have seemed to immunize the state scheme. Ante, at 593. But Congress was thought to have struck a new balance in 1937 with respect to a specific category of state-imposed restraints. Accordingly, the Court in Schwegmann determined congressional intent concerning the permissible limits of state restraints with respect to resale price maintenance by reference to the later, and more specific, expression of congressional purpose.[27] *640 There has been no analogous alteration of the original intent regarding the area of state regulation at issue here. Indeed, to the extent subsequent congressional action is probative at all, it shows a continuing intent to defer to the regulatory authority of the States over the terms and conditions of in-state electric utility service. Thus, 201 (a) of the Federal Power Act, 16 U.S. C. 824 (a), provides in relevant part that "Federal regulation. [is] to extend only to those matters which are not subject to regulation by the States." The Court's opinion simply ignores the clear evidence of congressional intent and substitutes its own policy judgment about the desirability of disregarding any facet of state economic regulation that it thinks unwise or of no great importance. In adopting this freewheeling approach to the language of the Sherman Act the Court creates a statutory simulacrum of the substantive due process doctrine I thought had been put to rest long ago. See[28] For the Court's approach contemplates the selective interdiction of those anticompetitive state regulatory measures that are deemed not "central" to the limited range of regulatory goals considered "imperative" by the federal judiciary. Henceforth, a state-regulated public utility company must at its peril successfully divine which of its countless and interrelated tariff provisions a federal court will ultimately consider "central" or "imperative." If it guesses wrong, it may be subjected to treble damages as a penalty for its compliance with state law. |
Justice White | majority | false | Williams v. Florida | 1970-06-22T00:00:00 | null | https://www.courtlistener.com/opinion/108186/williams-v-florida/ | https://www.courtlistener.com/api/rest/v3/clusters/108186/ | 1,970 | 1969-121 | 1 | 6 | 2 | Prior to his trial for robbery in the State of Florida, petitioner filed a "Motion for a Protective Order," seeking to be excused from the requirements of Rule 1.200 of the Florida Rules of Criminal Procedure. That rule requires a defendant, on written demand of the prosecuting attorney, to give notice in advance of trial if the defendant intends to claim an alibi, and to furnish the prosecuting attorney with information as to the place where he claims to have been and with the names and addresses of the alibi witnesses he intends to use.[1] In his motion petitioner openly declared his intent to claim an alibi, but objected to the further disclosure requirements on the ground that the rule "compels the Defendant in a criminal case to be a witness against himself" in violation of his Fifth and Fourteenth Amendment rights.[2] The motion was denied. Petitioner also filed a pretrial motion to impanel a 12-man jury instead of the six-man *80 jury provided by Florida law in all but capital cases.[3] That motion too was denied. Petitioner was convicted as charged and was sentenced to life imprisonment.[4] The District Court of Appeal affirmed, rejecting petitioner's claims that his Fifth and Sixth Amendment rights had been violated. We granted certiorari.[5] 396 U.S. 955 (1969).
I
Florida's notice-of-alibi rule is in essence a requirement that a defendant submit to a limited form of pretrial discovery by the State whenever he intends to rely at trial on the defense of alibi. In exchange for the defendant's disclosure of the witnesses he proposes to use to establish that defense, the State in turn is required to notify the defendant of any witnesses it proposes to offer in rebuttal to that defense. Both sides are under a continuing duty promptly to disclose the names and addresses of additional witnesses bearing on the alibi as they become available. The threatened sanction for failure to comply is the exclusion at trial of the defendant's alibi evidenceexcept for his own testimonyor, in the case of the State, the exclusion of the State's evidence offered in rebuttal of the alibi.[6]
In this case, following the denial of his Motion for a Protective Order, petitioner complied with the alibi *81 rule and gave the State the name and address of one Mary Scotty. Mrs. Scotty was summoned to the office of the State Attorney on the morning of the trial, where she gave pretrial testimony. At the trial itself, Mrs. Scotty, petitioner, and petitioner's wife all testified that the three of them had been in Mrs. Scotty's apartment during the time of the robbery. On two occasions during cross-examination of Mrs. Scotty, the prosecuting attorney confronted her with her earlier deposition in which she had given dates and times that in some respects did not correspond with the dates and times given at trial. Mrs. Scotty adhered to her trial story, insisting that she had been mistaken in her earlier testimony.[7] The State also offered in rebuttal the testimony of one of the officers investigating the robbery who claimed that Mrs. Scotty had asked him for directions on the afternoon in question during the time when she claimed to have been in her apartment with petitioner and his wife.[8]
We need not linger over the suggestion that the discovery permitted the State against petitioner in this case deprived him of "due process" or a "fair trial." Florida law provides for liberal discovery by the defendant against the State,[9] and the notice-of-alibi rule is itself carefully hedged with reciprocal duties requiring state disclosure to the defendant. Given the ease with which an alibi can be fabricated, the State's interest in protecting itself against an eleventh-hour defense is both obvious and legitimate. Reflecting this interest, notice-of-alibi provisions, dating at least from 1927,[10]*82 are now in existence in a substantial number of States.[11] The adversary system of trial is hardly an end in itself; it is not yet a poker game in which players enjoy an absolute right always to conceal their cards until played.[12] We find ample room in that system, at least as far as "due process" is concerned, for the instant Florida rule, which is designed to enhance the search for truth in the criminal trial by insuring both the defendant and the State ample opportunity to investigate certain facts crucial to the determination of guilt or innocence.
Petitioner's major contention is that he was "compelled. . . to be a witness against himself" contrary to the commands of the Fifth and Fourteenth Amendments because the notice-of-alibi rule required him to give the State the name and address of Mrs. Scotty in advance of trial and thus to furnish the State with information useful in convicting him. No pretrial statement of petitioner was introduced at trial; but armed with Mrs. Scotty's name and address and the knowledge *83 that she was to be petitioner's alibi witness, the State was able to take her deposition in advance of trial and to find rebuttal testimony. Also, requiring him to reveal the elements of his defense is claimed to have interfered with his right to wait until after the State had presented its case to decide how to defend against it. We conclude, however, as has apparently every other court that has considered the issue,[13] that the privilege against self-incrimination is not violated by a requirement that the defendant give notice of an alibi defense and disclose his alibi witnesses.[14]
The defendant in a criminal trial is frequently forced to testify himself and to call other witnesses in an effort to reduce the risk of conviction. When he presents his witnesses, he must reveal their identity and submit them to cross-examination which in itself may prove incriminating or which may furnish the State with leads to *84 incriminating rebuttal evidence. That the defendant faces such a dilemma demanding a choice between complete silence and presenting a defense has never been thought an invasion of the privilege against compelled self-incrimination. The pressures generated by the State's evidence may be severe but they do not vitiate the defendant's choice to present an alibi defense and witnesses to prove it, even though the attempted defense ends in catastrophe for the defendant. However "testimonial" or "incriminating" the alibi defense proves to be, it cannot be considered "compelled" within the meaning of the Fifth and Fourteenth Amendments.
Very similar constraints operate on the defendant when the State requires pretrial notice of alibi and the naming of alibi witnesses. Nothing in such a rule requires the defendant to rely on an alibi or prevents him from abandoning the defense; these matters are left to his unfettered choice.[15] That choice must *85 be made, but the pressures that bear on his pretrial decision are of the same nature as those that would induce him to call alibi witnesses at the trial: the force of historical fact beyond both his and the State's control and the strength of the State's case built on these facts. Response to that kind of pressure by offering evidence or testimony is not compelled self-incrimination transgressing the Fifth and Fourteenth Amendments.
In the case before us, the notice-of-alibi rule by itself in no way affected petitioner's crucial decision to call alibi witnesses or added to the legitimate pressures leading to that course of action. At most, the rule only compelled petitioner to accelerate the timing of his disclosure, forcing him to divulge at an earlier date information that the petitioner from the beginning planned to divulge at trial. Nothing in the Fifth Amendment privilege entitles a defendant as a matter of constitutional right to await the end of the State's case before announcing the nature of his defense, any more than it entitles him to await the jury's verdict on the State's case-in-chief before deciding whether or not to take the stand himself.
Petitioner concedes that absent the notice-of-alibi rule the Constitution would raise no bar to the court's granting the State a continuance at trial on the ground of surprise as soon as the alibi witness is called.[16] Nor *86 would there be self-incrimination problems if, during that continuance, the State was permitted to do precisely what it did here prior to trial: take the deposition of the witness and find rebuttal evidence. But if so utilizing a continuance is permissible under the Fifth and Fourteenth Amendments, then surely the same result may be accomplished through pretrial discovery, as it was here, avoiding the necessity of a disrupted trial.[17] We decline to hold that the privilege against compulsory self-incrimination guarantees the defendant the right to surprise the State with an alibi defense.
II
In Duncan v. Louisiana, 391 U.S. 145 (1968), we held that the Fourteenth Amendment guarantees a right to trial by jury in all criminal cases thatwere they to be tried in a federal courtwould come within the Sixth Amendment's guarantee. Petitioner's trial for robbery on July 3, 1968, clearly falls within the scope of that holding. See Baldwin v. New York, ante, p. 66; DeStefano v. Woods, 392 U.S. 631 (1968). The question in this case then is whether the constitutional guarantee of a trial by "jury" necessarily requires trial by exactly 12 persons, rather than some lesser numberin this case six. We hold that the 12-man panel is not a necessary ingredient of "trial by jury," and that respondent's refusal to impanel more than the six members provided for by Florida law did not violate petitioner's Sixth Amendment rights as applied to the States through the Fourteenth.
We had occasion in Duncan v. Louisiana, supra, to review briefly the oft-told history of the development *87 of trial by jury in criminal cases.[18] That history revealed a long tradition attaching great importance to the concept of relying on a body of one's peers to determine guilt or innocence as a safeguard against arbitrary law enforcement. That same history, however, affords little insight into the considerations that gradually led the size of that body to be generally fixed at 12.[19] Some have suggested that the number 12 was fixed upon simply because that was the number of the presentment jury from the hundred, from which the petit jury developed.[20]*88 Other, less circular but more fanciful reasons for the number 12 have been given, "but they were all brought forward after the number was fixed,"[21] and rest on little more than mystical or superstitious insights into the significance of "12." Lord Coke's explanation that the "number of twelve is much respected in holy writ, as 12 apostles, 12 stones, 12 tribes, etc.,"[22] is typical.[23] In *89 short, while sometime in the 14th century the size of the jury at common law came to be fixed generally at 12,[24] that particular feature of the jury system appears to have been a historical accident, unrelated to the great *90 purposes which gave rise to the jury in the first place.[25] The question before us is whether this accidental feature of the jury has been immutably codified into our Constitution.
This Court's earlier decisions have assumed an affirmative answer to this question. The leading case so construing the Sixth Amendment is Thompson v. Utah, 170 U.S. 343 (1898). There the defendant had been tried and convicted by a 12-man jury for a crime committed in the Territory of Utah. A new trial was granted, but by that time Utah had been admitted as a State. The defendant's new trial proceeded under Utah's Constitution, providing for a jury of only eight members. This Court reversed the resulting conviction, holding that Utah's constitutional provision was an ex post facto law as applied to the defendant. In reaching its conclusion, the Court announced that the Sixth Amendment was applicable to the defendant's trial when Utah was a Territory, and that the jury referred to in the Amendment was a jury "constituted, as it was at common law, of twelve persons, neither more nor less." 170 U.S., at 349. Arguably unnecessary for the result,[26]*91 this announcement was supported simply by referring to the Magna Carta,[27] and by quoting passages from treatises which notedwhat has already been seen that at common law the jury did indeed consist of 12. Noticeably absent was any discussion of the essential step in the argument: namely, that every feature of the jury as it existed at common lawwhether incidental or essential to that institutionwas necessarily included in the Constitution wherever that document referred to a "jury."[28] Subsequent decisions have reaffirmed the *92 announcement in Thompson, often in dictum[29] and usually by relyingwhere there was any discussion of the issue at allsolely on the fact that the common-law jury consisted of 12.[30] See Patton v. United States, 281 U.S. 276, 288 (1930);[31]Rassmussen v. United States, 197 U.S. 516, 519 (1905); Maxwell v. Dow, 176 U.S. 581, 586 (1900).
While "the intent of the Framers" is often an elusive quarry, the relevant constitutional history casts considerable doubt on the easy assumption in our past decisions that if a given feature existed in a jury at common law in 1789, then it was necessarily preserved in the Constitution. *93 Provisions for jury trial were first placed in the Constitution in Article III's provision that "[t]he Trial of all Crimes . . . shall be by Jury; and such Trial shall be held in the State where the said Crimes shall have been committed."[32] The "very scanty history [of this provision] in the records of the Constitutional Convention"[33] sheds little light either way on the intended correlation between Article III's "jury" and the features of the jury at common law.[34] Indeed, pending and after the adoption of the Constitution, fears were expressed that Article III's provision failed to preserve the common-law right to be tried by a "jury of the vicinage."[35] That concern, as well as the concern *94 to preserve the right to jury in civil as well as criminal cases, furnished part of the impetus for introducing amendments to the Constitution that ultimately resulted in the jury trial provisions of the Sixth and Seventh Amendments. As introduced by James Madison in the House, the Amendment relating to jury trial in criminal cases would have provided that:
"The trial of all crimes . . . shall be by an impartial jury of freeholders of the vicinage, with the requisite of unanimity for conviction, of the right of challenge, and other accustomed requisites . . . ."[36]
The Amendment passed the House in substantially this form, but after more than a week of debate in the Senate it returned to the House considerably altered.[37] While records of the actual debates that occurred in *95 the Senate are not available,[38] a letter from Madison to Edmund Pendleton on September 14, 1789, indicates that one of the Senate's major objections was to the "vicinage" requirement in the House version.[39] A conference committee was appointed. As reported in a second letter by Madison on September 23, 1789, the Senate remained opposed to the vicinage requirement, partly because in its view the then-pending judiciary billwhich was debated at the same time as the Amendments adequately preserved the common-law vicinage feature, making it unnecessary to freeze that requirement into the Constitution. "The Senate," wrote Madison:
"are . . . inflexible in opposing a definition of the locality of Juries. The vicinage they contend is either too vague or too strict a term; too vague if depending on limits to be fixed by the pleasure of the law, too strict if limited to the county. It was proposed to insert after the word Juries, `with the accustomed requisites,' leaving the definition to be construed according to the judgment of professional *96 men. Even this could not be obtained . . . . The Senate suppose, also, that the provision for vicinage in the Judiciary bill will sufficiently quiet the fears which called for an amendment on this point."[40]
The version that finally emerged from the Committee was the version that ultimately became the Sixth Amendment, ensuring an accused:
"the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law . . . ."
Gone were the provisions spelling out such common-law features of the jury as "unanimity," or "the accustomed requisites." And the "vicinage" requirement itself had been replaced by wording that reflected a compromise between broad and narrow definitions of that term, and that left Congress the power to determine the actual size of the "vicinage" by its creation of judicial districts.[41]
Three significant features may be observed in this sketch of the background of the Constitution's jury trial provisions. First, even though the vicinage requirement was as much a feature of the common-law jury as was the 12-man requirement,[42] the mere reference to "trial by jury" in Article III was not interpreted to include that feature. Indeed, as the subsequent debates over the Amendments indicate, disagreement arose over whether the feature should be included at all in its common-law sense, resulting in the compromise described above. Second, provisions that would have explicitly *97 tied the "jury" concept to the "accustomed requisites" of the time were eliminated. Such action is concededly open to the explanation that the "accustomed requisites" were thought to be already included in the concept of a "jury." But that explanation is no more plausible than the contrary one: that the deletion had some substantive effect. Indeed, given the clear expectation that a substantive change would be effected by the inclusion or deletion of an explicit "vicinage" requirement, the latter explanation is, if anything, the more plausible. Finally, contemporary legislative and constitutional provisions indicate that where Congress wanted to leave no doubt that it was incorporating existing common-law features of the jury system, it knew how to use express language to that effect. Thus, the Judiciary bill, signed by the President on the same day that the House and Senate finally agreed on the form of the Amendments to be submitted to the States, provided in certain cases for the narrower "vicinage" requirements that the House had wanted to include in the Amendments.[43] And the Seventh Amendment, providing for jury trial in civil cases, explicitly added that "no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law."[44]
*98 We do not pretend to be able to divine precisely what the word "jury" imported to the Framers, the First Congress, or the States in 1789. It may well be that the usual expectation was that the jury would consist of 12,[45] and that hence, the most likely conclusion *99 to be drawn is simply that little thought was actually given to the specific question we face today. But there is absolutely no indication in "the intent of the Framers" of an explicit decision to equate the constitutional and common-law characteristics of the jury. Nothing in this history suggests, then, that we do violence to the letter of the Constitution by turning to other than purely historical considerations to determine which features of the jury system, as it existed at common law, were preserved in the Constitution. The relevant inquiry, as we see it, must be the function that the particular feature performs and its relation to the *100 purposes of the jury trial. Measured by this standard, the 12-man requirement cannot be regarded as an indispensable component of the Sixth Amendment.
The purpose of the jury trial, as we noted in Duncan, is to prevent oppression by the Government. "Providing an accused with the right to be tried by a jury of his peers gave him an inestimable safeguard against the corrupt or overzealous prosecutor and against the compliant, biased, or eccentric judge." Duncan v. Louisiana, supra, at 156. Given this purpose, the essential feature of a jury obviously lies in the interposition between the accused and his accuser of the commonsense judgment of a group of laymen, and in the community participation and shared responsibility that results from that group's determination of guilt or innocence. The performance of this role is not a function of the particular number of the body that makes up the jury. To be sure, the number should probably be large enough to promote group deliberation, free from outside attempts at intimidation, and to provide a fair possibility for obtaining a representative cross-section of the community. But we find little reason to think that these goals are in any meaningful sense less likely to be achieved when the jury numbers six, than when it numbers 12particularly if the requirement of unanimity is retained.[46] And, certainly the reliability of the jury *101 as a factfinder hardly seems likely to be a function of its size.
It might be suggested that the 12-man jury gives a defendant a greater advantage since he has more "chances" of finding a juror who will insist on acquittal and thus prevent conviction. But the advantage might just as easily belong to the State, which also needs only one juror out of twelve insisting on guilt to prevent acquittal.[47] What few experiments have occurredusually in the civil areaindicate that there is no discernible difference between the results reached by the two different-sized juries.[48] In short, neither currently available evidence nor theory[49] suggests that the 12-man *102 jury is necessarily more advantageous to the defendant than a jury composed of fewer members.
Similarly, while in theory the number of viewpoints represented on a randomly selected jury ought to increase as the size of the jury increases, in practice the difference between the 12-man and the six-man jury in terms of the cross-section of the community represented seems likely to be negligible. Even the 12-man jury cannot insure representation of every distinct voice in the community, particularly given the use of the peremptory challenge. As long as arbitrary exclusions of a particular class from the jury rolls are forbidden, see, e. g., Carter v. Jury Commission, 396 U.S. 320, 329-330 (1970), the concern that the cross-section will be significantly diminished if the jury is decreased in size from 12 to six seems an unrealistic one.
We conclude, in short, as we began: the fact that the jury at common law was composed of precisely 12 is a historical accident, unnecessary to effect the purposes of the jury system and wholly without significance "except to mystics." Duncan v. Louisiana, supra, at 182 (HARLAN, J., dissenting). To read the Sixth Amendment as *103 forever codifying a feature so incidental to the real purpose of the Amendment is to ascribe a blind formalism to the Framers which would require considerably more evidence than we have been able to discover in the history and language of the Constitution or in the reasoning of our past decisions. We do not mean to intimate that legislatures can never have good reasons for concluding that the 12-man jury is preferable to the smaller jury, or that such conclusionsreflected in the provisions of most States and in our federal system[50] are in any sense unwise. Legislatures may well have their own views about the relative value of the larger and smaller juries, and may conclude that, wholly apart from the jury's primary function, it is desirable to spread the collective responsibility for the determination of guilt among the larger group. In capital cases, for example, it appears that no State provides for less than 12 jurors a fact that suggests implicit recognition of the value of the larger body as a means of legitimating society's decision to impose the death penalty. Our holding does no more than leave these considerations to Congress and the States, unrestrained by an interpretation of the Sixth Amendment that would forever dictate the precise number that can constitute a jury. Consistent with this holding, we conclude that petitioner's Sixth Amendment rights, as applied to the States through the Fourteenth Amendment, were not violated by Florida's decision to provide a six-man rather than a 12-man jury. The judgment of the Florida District Court of Appeal is
Affirmed.
MR. JUSTICE BLACKMUN took no part in the consideration or decision of this case.
*104 APPENDIX TO OPINION OF THE COURT
Fla. Rule Crim. Proc. 1.200:
"Upon the written demand of the prosecuting attorney, specifying as particularly as is known to such prosecuting attorney, the place, date and time of the commission of the crime charged, a defendant in a criminal case who intends to offer evidence of an alibi in his defense shall, not less than ten days before trial or such other time as the court may direct, file and serve upon such prosecuting attorney a notice in writing of his intention to claim such alibi, which notice shall contain specific information as to the place at which the defendant claims to have been at the time of the alleged offense and, as particularly as is known to defendant or his attorney, the names and addresses of the witnesses by whom he proposes to establish such alibi. Not less than five days after receipt of defendant's witness list, or such other times as the court may direct, the prosecuting attorney shall file and serve upon the defendant the names and addresses (as particularly as are known to the prosecuting attorney) of the witnesses the State proposes to offer in rebuttal to discredit the defendant's alibi at the trial of the cause. Both the defendant and the prosecuting attorney shall be under a continuing duty to promptly disclose the names and addresses of additional witnesses which come to the attention of either party subsequent to filing their respective witness lists as provided in this rule. If a defendant fails to file and serve a copy of such notice as herein required, the court may exclude evidence offered by such defendant for the purpose of proving an alibi, except the testimony of the defendant himself. If such notice is given by a *105 defendant, the court may exclude the testimony of any witness offered by the defendant for the purpose of proving an alibi if the name and address of such witness as particularly as is known to defendant or his attorney is not stated in such notice. If the prosecuting attorney fails to file and serve a copy on the defendant of a list of witnesses as herein provided, the court may exclude evidence offered by the state in rebuttal to the defendant's alibi evidence. If such notice is given by the prosecuting attorney, the court may exclude the testimony of any witness offered by the prosecuting attorney for the purpose of rebutting the defense of alibi if the name and address of such witness as particularly as is known to the prosecuting attorney is not stated in such notice. For good cause shown the court may waive the requirements of this rule."
MR. | Prior to his trial for robbery in the State of Florida, petitioner filed a "Motion for a Protective Order," seeking to be excused from the requirements of Rule 1.200 of the Florida Rules of Criminal Procedure. That rule requires a defendant, on written demand of the prosecuting attorney, to give notice in advance of trial if the defendant intends to claim an alibi, and to furnish the prosecuting attorney with information as to the place where he claims to have been and with the names and addresses of the alibi witnesses he intends to use.[1] In his motion petitioner openly declared his intent to claim an alibi, but objected to the further disclosure requirements on the ground that the rule "compels the Defendant in a criminal case to be a witness against himself" in violation of his Fifth and Fourteenth Amendment rights.[2] The motion was denied. Petitioner also filed a pretrial motion to impanel a 12-man jury instead of the six-man *80 jury provided by Florida law in all but capital cases.[3] That motion too was denied. Petitioner was convicted as charged and was sentenced to life imprisonment.[4] The District Court of Appeal affirmed, rejecting petitioner's claims that his Fifth and Sixth Amendment rights had been violated. We granted certiorari.[5] I Florida's notice-of-alibi rule is in essence a requirement that a defendant submit to a limited form of pretrial discovery by the State whenever he intends to rely at trial on the defense of alibi. In exchange for the defendant's disclosure of the witnesses he proposes to use to establish that defense, the State in turn is required to notify the defendant of any witnesses it proposes to offer in rebuttal to that defense. Both sides are under a continuing duty promptly to disclose the names and addresses of additional witnesses bearing on the alibi as they become available. The threatened sanction for failure to comply is the exclusion at trial of the defendant's alibi evidenceexcept for his own testimonyor, in the case of the State, the exclusion of the State's evidence offered in rebuttal of the alibi.[6] In this case, following the denial of his Motion for a Protective Order, petitioner complied with the alibi *81 rule and gave the State the name and address of one Mary Scotty. Mrs. Scotty was summoned to the office of the State Attorney on the morning of the trial, where she gave pretrial testimony. At the trial itself, Mrs. Scotty, petitioner, and petitioner's wife all testified that the three of them had been in Mrs. Scotty's apartment during the time of the robbery. On two occasions during cross-examination of Mrs. Scotty, the prosecuting attorney confronted her with her earlier deposition in which she had given dates and times that in some respects did not correspond with the dates and times given at trial. Mrs. Scotty adhered to her trial story, insisting that she had been mistaken in her earlier testimony.[7] The State also offered in rebuttal the testimony of one of the officers investigating the robbery who claimed that Mrs. Scotty had asked him for directions on the afternoon in question during the time when she claimed to have been in her apartment with petitioner and his wife.[8] We need not linger over the suggestion that the discovery permitted the State against petitioner in this case deprived him of "due process" or a "fair trial." Florida law provides for liberal discovery by the defendant against the State,[9] and the notice-of-alibi rule is itself carefully hedged with reciprocal duties requiring state disclosure to the defendant. Given the ease with which an alibi can be fabricated, the State's interest in protecting itself against an eleventh-hour defense is both obvious and legitimate. Reflecting this interest, notice-of-alibi provisions, dating at least from 1927,[10]*82 are now in existence in a substantial number of States.[11] The adversary system of trial is hardly an end in itself; it is not yet a poker game in which players enjoy an absolute right always to conceal their cards until played.[12] We find ample room in that system, at least as far as "due process" is concerned, for the instant Florida rule, which is designed to enhance the search for truth in the criminal trial by insuring both the defendant and the State ample opportunity to investigate certain facts crucial to the determination of guilt or innocence. Petitioner's major contention is that he was "compelled. to be a witness against himself" contrary to the commands of the Fifth and Fourteenth Amendments because the notice-of-alibi rule required him to give the State the name and address of Mrs. Scotty in advance of trial and thus to furnish the State with information useful in convicting him. No pretrial statement of petitioner was introduced at trial; but armed with Mrs. Scotty's name and address and the knowledge *83 that she was to be petitioner's alibi witness, the State was able to take her deposition in advance of trial and to find rebuttal testimony. Also, requiring him to reveal the elements of his defense is claimed to have interfered with his right to wait until after the State had presented its case to decide how to defend against it. We conclude, however, as has apparently every other court that has considered the issue,[13] that the privilege against self-incrimination is not violated by a requirement that the defendant give notice of an alibi defense and disclose his alibi witnesses.[14] The defendant in a criminal trial is frequently forced to testify himself and to call other witnesses in an effort to reduce the risk of conviction. When he presents his witnesses, he must reveal their identity and submit them to cross-examination which in itself may prove incriminating or which may furnish the State with leads to *84 incriminating rebuttal evidence. That the defendant faces such a dilemma demanding a choice between complete silence and presenting a defense has never been thought an invasion of the privilege against compelled self-incrimination. The pressures generated by the State's evidence may be severe but they do not vitiate the defendant's choice to present an alibi defense and witnesses to prove it, even though the attempted defense ends in catastrophe for the defendant. However "testimonial" or "incriminating" the alibi defense proves to be, it cannot be considered "compelled" within the meaning of the Fifth and Fourteenth Amendments. Very similar constraints operate on the defendant when the State requires pretrial notice of alibi and the naming of alibi witnesses. Nothing in such a rule requires the defendant to rely on an alibi or prevents him from abandoning the defense; these matters are left to his unfettered choice.[15] That choice must *85 be made, but the pressures that bear on his pretrial decision are of the same nature as those that would induce him to call alibi witnesses at the trial: the force of historical fact beyond both his and the State's control and the strength of the State's case built on these facts. Response to that kind of pressure by offering evidence or testimony is not compelled self-incrimination transgressing the Fifth and Fourteenth Amendments. In the case before us, the notice-of-alibi rule by itself in no way affected petitioner's crucial decision to call alibi witnesses or added to the legitimate pressures leading to that course of action. At most, the rule only compelled petitioner to accelerate the timing of his disclosure, forcing him to divulge at an earlier date information that the petitioner from the beginning planned to divulge at trial. Nothing in the Fifth Amendment privilege entitles a defendant as a matter of constitutional right to await the end of the State's case before announcing the nature of his defense, any more than it entitles him to await the jury's verdict on the State's case-in-chief before deciding whether or not to take the stand himself. Petitioner concedes that absent the notice-of-alibi rule the Constitution would raise no bar to the court's granting the State a continuance at trial on the ground of surprise as soon as the alibi witness is called.[16] Nor *86 would there be self-incrimination problems if, during that continuance, the State was permitted to do precisely what it did here prior to trial: take the deposition of the witness and find rebuttal evidence. But if so utilizing a continuance is permissible under the Fifth and Fourteenth Amendments, then surely the same result may be accomplished through pretrial discovery, as it was here, avoiding the necessity of a disrupted trial.[17] We decline to hold that the privilege against compulsory self-incrimination guarantees the defendant the right to surprise the State with an alibi defense. II In we held that the Fourteenth Amendment guarantees a right to trial by jury in all criminal cases thatwere they to be tried in a federal courtwould come within the Sixth Amendment's guarantee. Petitioner's trial for robbery on July 3, 1968, clearly falls within the scope of that holding. See Baldwin v. New York, ante, p. 66; The question in this case then is whether the constitutional guarantee of a trial by "jury" necessarily requires trial by exactly 12 persons, rather than some lesser numberin this case six. We hold that the 12-man panel is not a necessary ingredient of "trial by jury," and that respondent's refusal to impanel more than the six members provided for by Florida law did not violate petitioner's Sixth Amendment rights as applied to the States through the Fourteenth. We had occasion in to review briefly the oft-told history of the development *87 of trial by jury in criminal cases.[18] That history revealed a long tradition attaching great importance to the concept of relying on a body of one's peers to determine guilt or innocence as a safeguard against arbitrary law enforcement. That same history, however, affords little insight into the considerations that gradually led the size of that body to be generally fixed at 12.[19] Some have suggested that the number 12 was fixed upon simply because that was the number of the presentment jury from the hundred, from which the petit jury developed.[20]*88 Other, less circular but more fanciful reasons for the number 12 have been given, "but they were all brought forward after the number was fixed,"[21] and rest on little more than mystical or superstitious insights into the significance of "12." Lord Coke's explanation that the "number of twelve is much respected in holy writ, as 12 apostles, 12 stones, 12 tribes, etc.,"[22] is typical.[23] In *89 short, while sometime in the 14th century the size of the jury at common law came to be fixed generally at 12,[24] that particular feature of the jury system appears to have been a historical accident, unrelated to the great *90 purposes which gave rise to the jury in the first place.[25] The question before us is whether this accidental feature of the jury has been immutably codified into our Constitution. This Court's earlier decisions have assumed an affirmative answer to this question. The leading case so construing the Sixth Amendment is There the defendant had been tried and convicted by a 12-man jury for a crime committed in the Territory of Utah. A new trial was granted, but by that time Utah had been admitted as a State. The defendant's new trial proceeded under Utah's Constitution, providing for a jury of only eight members. This Court reversed the resulting conviction, holding that Utah's constitutional provision was an ex post facto law as applied to the defendant. In reaching its conclusion, the Court announced that the Sixth Amendment was applicable to the defendant's trial when Utah was a Territory, and that the jury referred to in the Amendment was a jury "constituted, as it was at common law, of twelve persons, neither more nor less." Arguably unnecessary for the result,[26]*91 this announcement was supported simply by referring to the Magna Carta,[27] and by quoting passages from treatises which notedwhat has already been seen that at common law the jury did indeed consist of 12. Noticeably absent was any discussion of the essential step in the argument: namely, that every feature of the jury as it existed at common lawwhether incidental or essential to that institutionwas necessarily included in the Constitution wherever that document referred to a "jury."[28] Subsequent decisions have reaffirmed the *92 announcement in Thompson, often in dictum[29] and usually by relyingwhere there was any discussion of the issue at allsolely on the fact that the common-law jury consisted of 12.[30] See ;[31]Rassmussen v. United States, ; While "the intent of the Framers" is often an elusive quarry, the relevant constitutional history casts considerable doubt on the easy assumption in our past decisions that if a given feature existed in a jury at common law in 1789, then it was necessarily preserved in the Constitution. *93 Provisions for jury trial were first placed in the Constitution in Article III's provision that "[t]he Trial of all Crimes shall be by Jury; and such Trial shall be held in the State where the said Crimes shall have been committed."[32] The "very scanty history [of this provision] in the records of the Constitutional Convention"[33] sheds little light either way on the intended correlation between Article III's "jury" and the features of the jury at common law.[34] Indeed, pending and after the adoption of the Constitution, fears were expressed that Article III's provision failed to preserve the common-law right to be tried by a "jury of the vicinage."[35] That concern, as well as the concern *94 to preserve the right to jury in civil as well as criminal cases, furnished part of the impetus for introducing amendments to the Constitution that ultimately resulted in the jury trial provisions of the Sixth and Seventh Amendments. As introduced by James Madison in the House, the Amendment relating to jury trial in criminal cases would have provided that: "The trial of all crimes shall be by an impartial jury of freeholders of the vicinage, with the requisite of unanimity for conviction, of the right of challenge, and other accustomed requisites"[36] The Amendment passed the House in substantially this form, but after more than a week of debate in the Senate it returned to the House considerably altered.[37] While records of the actual debates that occurred in *95 the Senate are not available,[38] a letter from Madison to Edmund Pendleton on September 14, 1789, indicates that one of the Senate's major objections was to the "vicinage" requirement in the House version.[39] A conference committee was appointed. As reported in a second letter by Madison on September 23, 1789, the Senate remained opposed to the vicinage requirement, partly because in its view the then-pending judiciary billwhich was debated at the same time as the Amendments adequately preserved the common-law vicinage feature, making it unnecessary to freeze that requirement into the Constitution. "The Senate," wrote Madison: "are inflexible in opposing a definition of the locality of Juries. The vicinage they contend is either too vague or too strict a term; too vague if depending on limits to be fixed by the pleasure of the law, too strict if limited to the county. It was proposed to insert after the word Juries, `with the accustomed requisites,' leaving the definition to be construed according to the judgment of professional *96 men. Even this could not be obtained The Senate suppose, also, that the provision for vicinage in the Judiciary bill will sufficiently quiet the fears which called for an amendment on this point."[40] The version that finally emerged from the Committee was the version that ultimately became the Sixth Amendment, ensuring an accused: "the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law" Gone were the provisions spelling out such common-law features of the jury as "unanimity," or "the accustomed requisites." And the "vicinage" requirement itself had been replaced by wording that reflected a compromise between broad and narrow definitions of that term, and that left Congress the power to determine the actual size of the "vicinage" by its creation of judicial districts.[41] Three significant features may be observed in this sketch of the background of the Constitution's jury trial provisions. First, even though the vicinage requirement was as much a feature of the common-law jury as was the 12-man requirement,[42] the mere reference to "trial by jury" in Article III was not interpreted to include that feature. Indeed, as the subsequent debates over the Amendments indicate, disagreement arose over whether the feature should be included at all in its common-law sense, resulting in the compromise described above. Second, provisions that would have explicitly *97 tied the "jury" concept to the "accustomed requisites" of the time were eliminated. Such action is concededly open to the explanation that the "accustomed requisites" were thought to be already included in the concept of a "jury." But that explanation is no more plausible than the contrary one: that the deletion had some substantive effect. Indeed, given the clear expectation that a substantive change would be effected by the inclusion or deletion of an explicit "vicinage" requirement, the latter explanation is, if anything, the more plausible. Finally, contemporary legislative and constitutional provisions indicate that where Congress wanted to leave no doubt that it was incorporating existing common-law features of the jury system, it knew how to use express language to that effect. Thus, the Judiciary bill, signed by the President on the same day that the House and Senate finally agreed on the form of the Amendments to be submitted to the States, provided in certain cases for the narrower "vicinage" requirements that the House had wanted to include in the Amendments.[43] And the Seventh Amendment, providing for jury trial in civil cases, explicitly added that "no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law."[44] *98 We do not pretend to be able to divine precisely what the word "jury" imported to the Framers, the First Congress, or the States in 1789. It may well be that the usual expectation was that the jury would consist of 12,[45] and that hence, the most likely conclusion *99 to be drawn is simply that little thought was actually given to the specific question we face today. But there is absolutely no indication in "the intent of the Framers" of an explicit decision to equate the constitutional and common-law characteristics of the jury. Nothing in this history suggests, then, that we do violence to the letter of the Constitution by turning to other than purely historical considerations to determine which features of the jury system, as it existed at common law, were preserved in the Constitution. The relevant inquiry, as we see it, must be the function that the particular feature performs and its relation to the *100 purposes of the jury trial. Measured by this standard, the 12-man requirement cannot be regarded as an indispensable component of the Sixth Amendment. The purpose of the jury trial, as we noted in Duncan, is to prevent oppression by the Government. "Providing an accused with the right to be tried by a jury of his peers gave him an inestimable safeguard against the corrupt or overzealous prosecutor and against the compliant, biased, or eccentric judge." Given this purpose, the essential feature of a jury obviously lies in the interposition between the accused and his accuser of the commonsense judgment of a group of laymen, and in the community participation and shared responsibility that results from that group's determination of guilt or innocence. The performance of this role is not a function of the particular number of the body that makes up the jury. To be sure, the number should probably be large enough to promote group deliberation, free from outside attempts at intimidation, and to provide a fair possibility for obtaining a representative cross-section of the community. But we find little reason to think that these goals are in any meaningful sense less likely to be achieved when the jury numbers six, than when it numbers 12particularly if the requirement of unanimity is retained.[46] And, certainly the reliability of the jury *101 as a factfinder hardly seems likely to be a function of its size. It might be suggested that the 12-man jury gives a defendant a greater advantage since he has more "chances" of finding a juror who will insist on acquittal and thus prevent conviction. But the advantage might just as easily belong to the State, which also needs only one juror out of twelve insisting on guilt to prevent acquittal.[47] What few experiments have occurredusually in the civil areaindicate that there is no discernible difference between the results reached by the two different-sized juries.[48] In short, neither currently available evidence nor theory[49] suggests that the 12-man *102 jury is necessarily more advantageous to the defendant than a jury composed of fewer members. Similarly, while in theory the number of viewpoints represented on a randomly selected jury ought to increase as the size of the jury increases, in practice the difference between the 12-man and the six-man jury in terms of the cross-section of the community represented seems likely to be negligible. Even the 12-man jury cannot insure representation of every distinct voice in the community, particularly given the use of the peremptory challenge. As long as arbitrary exclusions of a particular class from the jury rolls are forbidden, see, e. g., the concern that the cross-section will be significantly diminished if the jury is decreased in size from 12 to six seems an unrealistic one. We conclude, in short, as we began: the fact that the jury at common law was composed of precisely 12 is a historical accident, unnecessary to effect the purposes of the jury system and wholly without significance "except to mystics." To read the Sixth Amendment as *103 forever codifying a feature so incidental to the real purpose of the Amendment is to ascribe a blind formalism to the Framers which would require considerably more evidence than we have been able to discover in the history and language of the Constitution or in the reasoning of our past decisions. We do not mean to intimate that legislatures can never have good reasons for concluding that the 12-man jury is preferable to the smaller jury, or that such conclusionsreflected in the provisions of most States and in our federal system[50] are in any sense unwise. Legislatures may well have their own views about the relative value of the larger and smaller juries, and may conclude that, wholly apart from the jury's primary function, it is desirable to spread the collective responsibility for the determination of guilt among the larger group. In capital cases, for example, it appears that no State provides for less than 12 jurors a fact that suggests implicit recognition of the value of the larger body as a means of legitimating society's decision to impose the death penalty. Our holding does no more than leave these considerations to Congress and the States, unrestrained by an interpretation of the Sixth Amendment that would forever dictate the precise number that can constitute a jury. Consistent with this holding, we conclude that petitioner's Sixth Amendment rights, as applied to the States through the Fourteenth Amendment, were not violated by Florida's decision to provide a six-man rather than a 12-man jury. The judgment of the Florida District Court of Appeal is Affirmed. MR. JUSTICE BLACKMUN took no part in the consideration or decision of this case. *104 APPENDIX TO OPINION OF THE COURT Fla. Rule Crim. Proc. 1.200: "Upon the written demand of the prosecuting attorney, specifying as particularly as is known to such prosecuting attorney, the place, date and time of the commission of the crime charged, a defendant in a criminal case who intends to offer evidence of an alibi in his defense shall, not less than ten days before trial or such other time as the court may direct, file and serve upon such prosecuting attorney a notice in writing of his intention to claim such alibi, which notice shall contain specific information as to the place at which the defendant claims to have been at the time of the alleged offense and, as particularly as is known to defendant or his attorney, the names and addresses of the witnesses by whom he proposes to establish such alibi. Not less than five days after receipt of defendant's witness list, or such other times as the court may direct, the prosecuting attorney shall file and serve upon the defendant the names and addresses (as particularly as are known to the prosecuting attorney) of the witnesses the State proposes to offer in rebuttal to discredit the defendant's alibi at the trial of the cause. Both the defendant and the prosecuting attorney shall be under a continuing duty to promptly disclose the names and addresses of additional witnesses which come to the attention of either party subsequent to filing their respective witness lists as provided in this rule. If a defendant fails to file and serve a copy of such notice as herein required, the court may exclude evidence offered by such defendant for the purpose of proving an alibi, except the testimony of the defendant himself. If such notice is given by a *105 defendant, the court may exclude the testimony of any witness offered by the defendant for the purpose of proving an alibi if the name and address of such witness as particularly as is known to defendant or his attorney is not stated in such notice. If the prosecuting attorney fails to file and serve a copy on the defendant of a list of witnesses as herein provided, the court may exclude evidence offered by the state in rebuttal to the defendant's alibi evidence. If such notice is given by the prosecuting attorney, the court may exclude the testimony of any witness offered by the prosecuting attorney for the purpose of rebutting the defense of alibi if the name and address of such witness as particularly as is known to the prosecuting attorney is not stated in such notice. For good cause shown the court may waive the requirements of this rule." MR. |
Justice Rehnquist | dissenting | false | United States v. Williams | 1995-04-25T00:00:00 | null | https://www.courtlistener.com/opinion/117926/united-states-v-williams/ | https://www.courtlistener.com/api/rest/v3/clusters/117926/ | 1,995 | 1994-050 | 1 | 6 | 3 | The Court, in an unusual departure from the bedrock principle that waivers of sovereign immunity must be "unequivocally expressed," holds that respondent may sue for a refund of a tax which was not assessed against her. In so doing, it *542 outlines in some detail what it conceives to be the equities of respondent's situationa factor not usually of great significance in construing the Internal Revenue Code. I believe that the Court's picture of the equities is misleadingly inaccurate, and that its effort to stretch the law to avoid these perceived inequities is quite contrary to established doctrine.
The legal question at hand is whether the Government has waived its sovereign immunity in 28 U.S. C. § 1346(a)(1) to authorize respondent, who conceded that she "is not the taxpayer," App. 16, to file a refund suit. In answering that question, it must be remembered that § 1346(a)(1) is "a jurisdictional provision which is a keystone in a carefully articulated and quite complicated structure of tax laws." Flora v. United States, 362 U.S. 145, 157 (1960). Section "1346(a)(1) must be read in conformity with other statutory provisions [26 U.S. C. §§ 7422(a) and 6511(a)] which qualify a taxpayer's right to bring a refund suit." United States v. Dalm, 494 U.S. 596, 601-602 (1990).
Section 1346(a)(1) provides:
"The district courts shall have original jurisdiction, concurrent with the United States Court of Federal Claims, of:
"(1) Any civil action against the United States for the recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected, or any penalty claimed to have been collected without authority or any sum alleged to have been excessive or in any manner wrongfully collected under the internalrevenue laws." 28 U.S. C. § 1346(a)(1) (1988 ed. and Supp V).
The jurisdiction conferred by § 1346(a)(1) is limited by 26 U.S. C. § 7422(a). Like § 1346(a)(1), § 7422(a) contains no language limiting a refund suit to the "taxpayer," but its "express language . . . conditions a district court's authority *543 to hear a refund suit." Dalm, supra, at 609, n. 6. It requires that "a claim for refund or credit [first be] filed with the Secretary, according to the provisions of law in that regard." 26 U.S. C. § 7422(a). There are two "provisions of law" dealing with such claims. Title 26 U.S. C. § 6511(a) provides in part that a
"[c]laim for credit or refund of an overpayment of any tax imposed by this title in respect of which tax the taxpayer is required to file a return shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid." (Emphasis added.)
Title 26 U.S. C. § 6532(a), which imposes a period of limitations on suits for refunds in court and is entitled "Suits by taxpayers for refund," states that
"[n]o suit or proceeding under section 7422(a) . . . shall be begun before the expiration of 6 months from the date of filing the claim required under such section . . . , nor after the expiration of 2 years from the date of mailing by certified mail or registered mail by the Secretary to the taxpayer of a notice of the disallowance" (emphasis added).
Both §§ 6511(a) and 6532(a) clearly are limited to the "taxpayer," and the term "taxpayer" is in turn defined in § 7701(a)(14) to mean "any person subject to any internal revenue tax." Reading these provisions as a whole, the conclusion is inescapable that only a "taxpayer" (§ 7701(a)(14)) who has filed a timely claim for refund (under § 6511(a)) and a timely suit for refund (under § 6532(a)) is authorized to maintain a suit for refund in any court (§ 7422(a)) for an "erroneously or illegally assessed or collected" tax (28 U.S. C. § 1346(a)(1)).
The Court describes 26 U.S. C. § 6511(a) as providing "only a deadline for filing for administrative relief, not a limit on who may file." Ante, at 534. But the "plain terms" of *544 § 6511(a), ibid., do impose such a limita refund claim may be filed only "by the taxpayer." The Court discounts the notion that the term "taxpayer" limits administrative relief to the party assessed by concluding that such a construction "is inconsistent with other provisions of the refund scheme." Ibid. The "other provisions" cited by the Court, however, are in no way inconsistent with the above construction of § 6511(a): the fact that the Secretary is authorized to refund any overpayment to "the person who made the overpayment," § 6402(a), or to "the person who paid the tax," §§ 6416(a), 6419(a), does not mean that such a person may bring suit if she disagrees with the Secretary's calculation of the amount of the overpayment. And even if such an inconsistency did exist, an "inconsistency" is not enough to carry the day when dealing with a waiver of sovereign immunity; "inconsistency" simply means ambiguity, and because a waiver of sovereign immunity must be "`unequivocally expressed,' " any ambiguity is construed in favor of immunity. United States v. Nordic Village, Inc. , 503 U.S. 30, 33 (1992).
The Court proceeds to argue that, even if only "taxpayers" could seek administrative relief under § 6511, respondent qualifies as a "taxpayer." Ante, at 535. That term is defined in the Code as "any person subject to any internal revenue tax." § 7701(a)(14). The Court says this phrase is "broad enough to include [respondent]" because the Government "place[d] a lien on her home and then accept[ed] her tax payment." Ante, at 535. This is remarkably imprecise reasoning.
Respondent was subjected to a tax lien, but this does not mean she was "subject to any internal revenue tax" in the normal sense of that phrase as used in the Code. The tax was assessed against Rabin, not respondent, and respondent has equivocated as to whether she is simply challenging the lien or also challenging Rabin's underlying tax assessment. The underlying tax, and the lien to enforce liability for that tax, are obviously two different things. One may have a tax *545 assessed against him, and if he pays it in a timely manner he will never be subject to a lien. Conversely, one against whom the tax was not assessed may nonetheless be subject to a lien to enforce collection of that tax. The Court says it will decide here only the challenge to the lien, thereby leaving the tax totally unchallenged in this proceeding. Ante, at 539-540, and n. 10. This is quite contrary to the language quoted above, which allows only the person "subject to any internal revenue tax " to file the claim for refund which is the necessary prerequisite for bringing a refund suit under § 1346(a)(1).
The Court believes its position is reinforced by its conclusion that respondent is left without a remedy if she cannot bring a refund suit under § 1346(a)(1). Equities ordinarily do not assume such a dominant role when dealing with questions of sovereign immunity, but if they are to play that role, the equities ought to be those which can be confirmed on the record before us.
The undisputed facts of record which evoke the Court's sympathy are these. Rabin and respondent owned the property in question as joint tenants. In June 1987, and in March 1988, the Government made federal employment tax assessments totaling nearly $15,000 against Rabin. A federal tax lien securing the taxes and interest owed by Rabin arose "at the time the assessment [was] made," 26 U.S. C. § 6322, and reached "all property and rights to property, whether real or personal, belonging to" Rabin at that time. § 6321. In October 1988, Rabin and respondent entered into a "transfer agreement," whereby Rabin agreed to convey his interest in the property to respondent and to indemnify her for the payment of any liens on the property. Rabin transferred his interest in the property to respondent by executing a quitclaim deed. The deed, recorded nearly three months before any divorce proceedings had commenced, described respondent as "`an unmarried woman.' " App. 14. This misrepresentationstating that respondent was "`an *546 unmarried woman' " at the time of the transferraises the question whether the property was conveyed to respondent "in contemplation of divorce," as the Court says, ante, at 530, or whether it was done in an attempt to shield Rabin's assets from the tax lien. In November 1988, the Government recorded notice of the federal tax lien. Respondent commenced divorce proceedings against Rabin in January 1989, and in May 1989, while the divorce petition was pending, respondent entered into an agreement to sell the property. In June 1989, the Government filed notice of additional tax liens, including a lien in respondent's name as nominee, agent, alter ego, and holder of a beneficial interest in the property for Rabin. The closing date for the sale of the property was July 3, 1989.
Respondent thus faced a situation not uncommon to those who seek to transfer a clear title to real property: Her property was subject to federal tax liens. But despite the Court's suggestion to the contrary, respondent clearly had available to her at least two remedies. She could have brought an action to "quiet title" under 28 U.S. C. § 2410(a)(1), or she could have sought from the Secretary a "certificate of discharge" of the property under 26 U.S. C. § 6325(b)(3).
The Court, relying on respondent's bald assertion that she had no notice of the liens until the week before the closing, concludes that a quiet title action under § 2410(a) would not have afforded respondent meaningful relief because only "a refund suit would allow her to sell the property and simultaneously pay off the lien, leaving her free to litigate with the Government without tying up her real property." Ante, at 537. This simply begs the question. Obviously, a quiet title action brought at the time respondent agreed to sell the property could not have proceeded to judgment before the closing date, but that is true of lawsuits to quiet title against all sorts of other liens that may prevent the conveyance of clear title. The existence of outstanding liens on property *547 is a fact of life, and heretofore lienorsleast of all the United Stateshave not been required to afford the legal equivalent of "same day service" to finally adjudicate title before the closing date.
Respondent was not left only with the remedy of a quiet title action; she could have sought from the Secretary a "certificate of discharge" of the property under 26 U.S. C. § 6325(b)(3) by agreeing to hold the proceeds of the sale of the property "as a fund subject to the liens and claims of the United States," with the propriety of the liens to be litigated in a subsequent action under § 7426(a)(3). The Court finds this remedy inadequate because it was a "doubtful" remedy upon which respondent could not "rely," since the certificate of discharge could issue only in the exercise of the Secretary's discretion. Ante, at 537. That the Secretary must exercise discretion does not make § 6325(b)(3) a "doubtful" remedy. Congress appropriately granted the Secretary discretion to determine, on a case-by-case basis, whether the proceeds from the sale of property will be sufficient to protect the Government's tax lien. And because the worth of respondent's property "far exceeded the value of the Government's liens," ibid., the Secretary most likely would have issued a certificate of discharge in this case. But respondent never sought to invoke this remedy, and the cases are legion holding that a person may not claim an administrative remedy was inadequate if she never sought to invoke it. See, e. g., McGee v. United States, 402 U.S. 479, 483 (1971) (a Selective Service registrant may not complain in court if the registrant "has failed to pursue normal administrative remedies and thus has sidestepped a corrective process which might have cured or rendered moot the very defect later complained of"); Geo. F. Alger Co. v. Peck, 74 S. Ct. 605, 606-607, 98 L. Ed. 1148, 1150 (1954) (Reed, J., in chambers) (a company may not complain in court when it failed to take advantage of an available administrative remedy, even though that remedy may "cause inconvenience and expense"); *548 cf. McCarthy v. Madigan, 503 U.S. 140, 145 (1992) (exhaustion of administrative remedies "appl[ies] with particular force when the action under review involves exercise of the agency's discretionary power or when the agency proceedings in question allow the agency to apply its special expertise") (citing McKart v. United States, 395 U.S. 185, 194 (1969)).
To make a bad matter worse, the Court faults the Government for not "afford[ing respondent] an opportunity" to pursue this remedy. Ante, at 537. This makes one wonder whether we are entering an era where internal revenue agents must give warnings to delinquent taxpayers and lienees analogous to the warnings required in criminal cases by our decision in Miranda v. Arizona, 384 U.S. 436 (1966). Certainly the Court has never so held before, and one may hope that it would not so hold in the future. Indeed, since respondent concedes in her brief that the Government was not required to tell her about the discretionary relief available, Brief for Respondent 20, it is surprising to see the Court suggest to the contrary.
If this case involved the interpretation of a statute designed to confer new benefits or rights upon a class of individuals, today's decision would be more understandable, since such a statute would be "entitled to a liberal construction to accomplish its beneficent purposes." Cosmopolitan Shipping Co. v. McAllister, 337 U.S. 783 (1949) (construing the Jones Act); see also Atchison, T. & S. F. R. Co. v. Buell, 480 U.S. 557, 562 (1987) (stating that the Federal Employers' Liability Act is a "broad remedial statute" which must be given a "`liberal construction' "). But it would surely come as news to the millions of taxpayers in this country that the Internal Revenue Code has a "beneficent purpose" as far as they are concerned. It does not, and the Court is mistaken to decide this case in a way that can only be justified if it does.
| The Court, in an unusual departure from the bedrock principle that waivers of sovereign immunity must be "unequivocally expressed," holds that respondent may sue for a refund of a tax which was not assessed against her. In so doing, it *542 outlines in some detail what it conceives to be the equities of respondent's situationa factor not usually of great significance in construing the Internal Revenue Code. I believe that the Court's picture of the equities is misleadingly inaccurate, and that its effort to stretch the law to avoid these perceived inequities is quite contrary to established doctrine. The legal question at hand is whether the Government has waived its sovereign immunity in 28 U.S. C. 1346(a)(1) to authorize respondent, who conceded that she "is not the taxpayer," App. 16, to file a refund suit. In answering that question, it must be remembered that 1346(a)(1) is "a jurisdictional provision which is a keystone in a carefully articulated and quite complicated structure of tax laws." Section "1346(a)(1) must be read in conformity with other statutory provisions [26 U.S. C. 7422(a) and 6511(a)] which qualify a taxpayer's right to bring a refund suit." United Section 1346(a)(1) provides: "The district courts shall have original jurisdiction, concurrent with the United States Court of Federal Claims, of: "(1) Any civil action against the United States for the recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected, or any penalty claimed to have been collected without authority or any sum alleged to have been excessive or in any manner wrongfully collected under the internalrevenue laws." 28 U.S. C. 1346(a)(1) (1988 ed. and Supp V). The jurisdiction conferred by 1346(a)(1) is limited by 26 U.S. C. 7422(a). Like 1346(a)(1), 7422(a) contains no language limiting a refund suit to the "taxpayer," but its "express language conditions a district court's authority *543 to hear a refund suit." It requires that "a claim for refund or credit [first be] filed with the Secretary, according to the provisions of law in that regard." 26 U.S. C. 7422(a). There are two "provisions of law" dealing with such claims. Title 26 U.S. C. 6511(a) provides in part that a "[c]laim for credit or refund of an overpayment of any tax imposed by this title in respect of which tax the taxpayer is required to file a return shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid." (Emphasis added.) Title 26 U.S. C. 6532(a), which imposes a period of limitations on suits for refunds in court and is entitled "Suits by taxpayers for refund," states that "[n]o suit or proceeding under section 7422(a) shall be begun before the expiration of 6 months from the date of filing the claim required under such section nor after the expiration of 2 years from the date of mailing by certified mail or registered mail by the Secretary to the taxpayer of a notice of the disallowance" (emphasis added). Both 6511(a) and 6532(a) clearly are limited to the "taxpayer," and the term "taxpayer" is in turn defined in 7701(a)(14) to mean "any person subject to any internal revenue tax." Reading these provisions as a whole, the conclusion is inescapable that only a "taxpayer" ( 7701(a)(14)) who has filed a timely claim for refund (under 6511(a)) and a timely suit for refund (under 6532(a)) is authorized to maintain a suit for refund in any court ( 7422(a)) for an "erroneously or illegally assessed or collected" tax (28 U.S. C. 1346(a)(1)). The Court describes 26 U.S. C. 6511(a) as providing "only a deadline for filing for administrative relief, not a limit on who may file." Ante, at 534. But the "plain terms" of *544 6511(a), ibid., do impose such a limita refund claim may be filed only "by the taxpayer." The Court discounts the notion that the term "taxpayer" limits administrative relief to the party assessed by concluding that such a construction "is inconsistent with other provisions of the refund scheme." The "other provisions" cited by the Court, however, are in no way inconsistent with the above construction of 6511(a): the fact that the Secretary is authorized to refund any overpayment to "the person who made the overpayment," 6402(a), or to "the person who paid the tax," 6416(a), 6419(a), does not mean that such a person may bring suit if she disagrees with the Secretary's calculation of the amount of the overpayment. And even if such an inconsistency did exist, an "inconsistency" is not enough to carry the day when dealing with a waiver of sovereign immunity; "inconsistency" simply means ambiguity, and because a waiver of sovereign immunity must be "`unequivocally expressed,' " any ambiguity is construed in favor of immunity. United The Court proceeds to argue that, even if only "taxpayers" could seek administrative relief under 6511, respondent qualifies as a "taxpayer." Ante, at 535. That term is defined in the Code as "any person subject to any internal revenue tax." 7701(a)(14). The Court says this phrase is "broad enough to include [respondent]" because the Government "place[d] a lien on her home and then accept[ed] her tax payment." Ante, at 535. This is remarkably imprecise reasoning. Respondent was subjected to a tax lien, but this does not mean she was "subject to any internal revenue tax" in the normal sense of that phrase as used in the Code. The tax was assessed against Rabin, not respondent, and respondent has equivocated as to whether she is simply challenging the lien or also challenging Rabin's underlying tax assessment. The underlying tax, and the lien to enforce liability for that tax, are obviously two different things. One may have a tax *545 assessed against him, and if he pays it in a timely manner he will never be subject to a lien. Conversely, one against whom the tax was not assessed may nonetheless be subject to a lien to enforce collection of that tax. The Court says it will decide here only the challenge to the lien, thereby leaving the tax totally unchallenged in this proceeding. Ante, at 539-540, and n. 10. This is quite contrary to the language quoted above, which allows only the person "subject to any internal revenue tax " to file the claim for refund which is the necessary prerequisite for bringing a refund suit under 1346(a)(1). The Court believes its position is reinforced by its conclusion that respondent is left without a remedy if she cannot bring a refund suit under 1346(a)(1). Equities ordinarily do not assume such a dominant role when dealing with questions of sovereign immunity, but if they are to play that role, the equities ought to be those which can be confirmed on the record before us. The undisputed facts of record which evoke the Court's sympathy are these. Rabin and respondent owned the property in question as joint tenants. In June 1987, and in March 1988, the Government made federal employment tax assessments totaling nearly $15,000 against Rabin. A federal tax lien securing the taxes and interest owed by Rabin arose "at the time the assessment [was] made," 26 U.S. C. 6322, and reached "all property and rights to property, whether real or personal, belonging to" Rabin at that time. 6321. In October 1988, Rabin and respondent entered into a "transfer agreement," whereby Rabin agreed to convey his interest in the property to respondent and to indemnify her for the payment of any liens on the property. Rabin transferred his interest in the property to respondent by executing a quitclaim deed. The deed, recorded nearly three months before any divorce proceedings had commenced, described respondent as "`an unmarried woman.' " App. 14. This misrepresentationstating that respondent was "`an *546 unmarried woman' " at the time of the transferraises the question whether the property was conveyed to respondent "in contemplation of divorce," as the Court says, ante, at 530, or whether it was done in an attempt to shield Rabin's assets from the tax lien. In November 1988, the Government recorded notice of the federal tax lien. Respondent commenced divorce proceedings against Rabin in January 1989, and in May 1989, while the divorce petition was pending, respondent entered into an agreement to sell the property. In June 1989, the Government filed notice of additional tax liens, including a lien in respondent's name as nominee, agent, alter ego, and holder of a beneficial interest in the property for Rabin. The closing date for the sale of the property was July 3, 1989. Respondent thus faced a situation not uncommon to those who seek to transfer a clear title to real property: Her property was subject to federal tax liens. But despite the Court's suggestion to the contrary, respondent clearly had available to her at least two remedies. She could have brought an action to "quiet title" under 28 U.S. C. 2410(a)(1), or she could have sought from the Secretary a "certificate of discharge" of the property under 26 U.S. C. 6325(b)(3). The Court, relying on respondent's bald assertion that she had no notice of the liens until the week before the closing, concludes that a quiet title action under 2410(a) would not have afforded respondent meaningful relief because only "a refund suit would allow her to sell the property and simultaneously pay off the lien, leaving her free to litigate with the Government without tying up her real property." Ante, at 537. This simply begs the question. Obviously, a quiet title action brought at the time respondent agreed to sell the property could not have proceeded to judgment before the closing date, but that is true of lawsuits to quiet title against all sorts of other liens that may prevent the conveyance of clear title. The existence of outstanding liens on property *547 is a fact of life, and heretofore lienorsleast of all the United Stateshave not been required to afford the legal equivalent of "same day service" to finally adjudicate title before the closing date. Respondent was not left only with the remedy of a quiet title action; she could have sought from the Secretary a "certificate of discharge" of the property under 26 U.S. C. 6325(b)(3) by agreeing to hold the proceeds of the sale of the property "as a fund subject to the liens and claims of the United States," with the propriety of the liens to be litigated in a subsequent action under 7426(a)(3). The Court finds this remedy inadequate because it was a "doubtful" remedy upon which respondent could not "rely," since the certificate of discharge could issue only in the exercise of the Secretary's discretion. Ante, at 537. That the Secretary must exercise discretion does not make 6325(b)(3) a "doubtful" remedy. Congress appropriately granted the Secretary discretion to determine, on a case-by-case basis, whether the proceeds from the sale of property will be sufficient to protect the Government's tax lien. And because the worth of respondent's property "far exceeded the value of the Government's liens," ibid., the Secretary most likely would have issued a certificate of discharge in this case. But respondent never sought to invoke this remedy, and the cases are legion holding that a person may not claim an administrative remedy was inadequate if she never sought to invoke it. See, e. g., ; Geo. F. Alger (a company may not complain in court when it failed to take advantage of an available administrative remedy, even though that remedy may "cause inconvenience and expense"); *548 cf. ). To make a bad matter worse, the Court faults the Government for not "afford[ing respondent] an opportunity" to pursue this remedy. Ante, at 537. This makes one wonder whether we are entering an era where internal revenue agents must give warnings to delinquent taxpayers and lienees analogous to the warnings required in criminal cases by our decision in Certainly the Court has never so held before, and one may hope that it would not so hold in the future. Indeed, since respondent concedes in her brief that the Government was not required to tell her about the discretionary relief available, Brief for Respondent 20, it is surprising to see the Court suggest to the contrary. If this case involved the interpretation of a statute designed to confer new benefits or rights upon a class of individuals, today's decision would be more understandable, since such a statute would be "entitled to a liberal construction to accomplish its beneficent purposes." Cosmopolitan Shipping 7 U.S. 783 (9) ; see also Atchison, T. & S. F. R. But it would surely come as news to the millions of taxpayers in this country that the Internal Revenue Code has a "beneficent purpose" as far as they are concerned. It does not, and the Court is mistaken to decide this case in a way that can only be justified if it does. |
Justice Gorsuch | dissenting | false | BNSF R. Co. v. Loos | 2019-03-04T00:00:00 | null | https://www.courtlistener.com/opinion/4595876/bnsf-r-co-v-loos/ | https://www.courtlistener.com/api/rest/v3/clusters/4595876/ | 2,019 | null | null | null | null | BNSF Railway’s negligence caused one of its employees
a serious injury. After a trial, a court ordered the
company to pay damages. But instead of sending the full
amount to the employee, BNSF asserted that it had to
divert a portion to the Internal Revenue Service. Why?
BNSF said the money represented taxable “compensation”
for “services rendered as an employee.” 26 U.S. C.
§3231(e)(1). Today, the Court agrees with the company.
Respectfully, I do not. When an employee suffers a
physical injury due to his employer’s negligence and has to
sue in court to recover damages, it seems more natural to
me to describe the final judgment as compensation for his
injury than for services (never) rendered.
The Court does not lay out the facts of the case, but they
are relevant to my analysis and straightforward enough.
Years ago, Michael Loos was working for BNSF in a train
yard when he fell into a hidden drainage grate and injured
his knee. He missed work for many months, and upon his
return he had a series of absences, many of which he
attributed to knee-injury flareups. When the company
moved to fire him for allegedly violating its attendance
policies, Mr. Loos sued. Among other things, Mr. Loos
sought damages for BNSF’s negligence in maintaining the
2 BNSF R. CO. v. LOOS
GORSUCH, J., dissenting
train yard. He brought his claim under the Federal
Employers’ Liability Act (FELA), an analogue to
tradititional state-law tort suits that makes an interstate
railroad “liable in damages to any person suffering injury
while he is employed” by the railroad “for such injury . . .
resulting in whole or in part from the [railroad’s]
negligence.” 45 U.S. C. §51. Ultimately, and again much
like in any other tort suit, the jury awarded damages in
three categories: $85,000 in pain and suffering, $11,212.78
in medical expenses, and $30,000 in lost wages—the final
category representing the amount Mr. Loos was unable to
earn because of the injury BNSF’s negligence caused.
Then a strange thing happened. BNSF argued that the
lost wages portion of Mr. Loos’s judgment represented
“compensation” to him “for services rendered as an
employee” and was thus taxable income under the
Railroad Retirement Tax Act (RRTA). 26 U.S. C. §3201
et seq. In much the same way the Social Security Act
taxes other citizens’ incomes to fund their retirement
benefits, the RRTA taxes railroad employees’ earnings to
pay for their public pensions. And BNSF took the view
that, because Mr. Loos owed the IRS taxes on the lost
wages portion of his judgment, it had to withhold an
appropriate sum and redirect it to the government. The
company took this position even though it meant BNSF
would owe corresponding excise taxes. See 26 U.S. C.
§3221. It took this position, too, even though no one has
identified for us a single case where the IRS has sought to
collect RRTA taxes on a FELA judgment in the 80 years
the two statutes have coexisted. The company even
persisted in its view after, first, the district court and,
then, the Eighth Circuit ruled that Mr. Loos’s award
wasn’t subject to RRTA taxes. Even after all that, BNSF
went to the trouble of seeking review in this Court to win
the right to pay the IRS.
What’s the reason for BNSF’s tireless campaign? Is the
Cite as: 586 U. S. ____ (2019) 3
GORSUCH, J., dissenting
company really moved by a selfless desire to protect a
federal program from “a long-term risk of insolvency”?
See ante, at 5, n. 2. Several amici offer a more prosaic
possibility. Under the rule BNSF seeks and wins today,
RRTA taxes will be due on (but only on) the portion of a
FELA settlement or judgment designated as lost wages.
Taxes will not attach to other amounts attributed to, say,
pain and suffering or medical costs. At trial, of course, a
plaintiff ’s damages are what they are, and often juries
will attribute a significant portion of damages to lost
wages. But with the help of the asymmetric tax treatment
they secure today, railroads like BSNF can now sweeten
their settlement offers while offering less money. Forgo
trial and accept a lower settlement, they will tell injured
workers, and in return we will designate a small fraction
(maybe even none) of the payments as taxable lost wages.
In this way, the Court’s decision today may do precisely
nothing to increase the government’s tax collections or
protect the solvency of any federal program. Instead, it
may only mean that employees will pay a tax for going to
trial—and railroads will succeed in buying cheaper
settlements in the future at the bargain basement price of
a few thousand dollars in excise taxes in one case today.
See Brief for American Association for Justice as Amicus
Curiae 34–36; Brief for SMART et al. as Amici Curiae 5–7.
Whatever the reason for BNSF’s gambit, the problems
with it start for me at the first step of the statutory
interpretation analysis—with the text of the law itself.
The RRTA taxes an employee’s “compensation,” which it
defines as “money remuneration . . . for services rendered
as an employee to one or more employers.” 26 U.S. C.
§3231(e)(1). A “service” refers to “duty or labor . . . by one
person . . . bound to submit his will to the direction and
control of [another].” Black’s Law Dictionary 1607 (3d ed.
1933). And “remuneration” means “a quid pro quo,” “rec-
ompense” or “reward” for such services. Id., at 1528. So
4 BNSF R. CO. v. LOOS
GORSUCH, J., dissenting
the words “remuneration for services rendered” naturally
cover things like an employee’s salary or hourly wage.
Nor do they stop there, as the Court correctly notes.
Rather, and contrary to the court of appeals’ view, those
words also fairly encompass benefits like sick or disability
pay. After all, an employer offers those benefits to attract
and keep employees working on its behalf. In that way,
these benefits form part of the “quid pro quo” (compensa-
tion) the employer pays to secure the “duty or labor” (ser-
vices) the employee renders. Cf. United States v. Quality
Stores, Inc., 572 U.S. 141, 146 (2014).
But damages for negligence are different. No one would
describe a dangerous fall or the wrenching of a knee as a
“service rendered” to the party who negligently caused the
accident. BNSF hardly directed Mr. Loos to fall or offered
to pay him for doing so. In fact, BNSF didn’t even pay Mr.
Loos voluntarily; he had to wrest a judgment from the
railroad at the end of a legal battle. So Mr. Loos’s FELA
judgment seems to me, as it did to every judge in the
proceedings below, unconnected to any service Mr. Loos
rendered to BNSF. Instead of being “compensation” for
“services rendered as an employee,” it seems more natural
to say that the negligence damages BNSF paid are “com-
pensation” to Mr. Loos for his injury. That’s exactly how
we usually understand tort damages—as “compensation”
for an “injury” caused by “the unlawful act or omission or
negligence of another.” Black’s Law Dictionary 314 (2d ed.
1910). And that’s exactly how FELA describes the damages
it provides—stating that it renders a railroad “liable”
not for services rendered but for any “injury” caused by
the defendant’s “negligence.” 45 U.S. C. §51; see also New
York Central R. Co. v. Winfield, 244 U.S. 147, 164 (1917)
(Brandeis, J., dissenting) (FELA liability is “a penalty for
wrong doing,” a “remedy” that “mak[es] the wrongdoer
indemnify him whom he has wronged”).
Of course, BNSF isn’t without a reply. Time and again
Cite as: 586 U. S. ____ (2019) 5
GORSUCH, J., dissenting
it highlights the fact that the district court measured the
lost wages portion of Mr. Loos’s award by reference to
what he could have earned but for his injury. But if
BNSF’s negligence had injured a passenger on a train
instead of an employee in a train yard, a jury could have
measured the passenger’s tort damages in exactly the
same way, taking account of the wages she could have
earned from her own employer but for the railroad’s negli-
gence. Vicksburg & Meridian R. Co. v. Putnam, 118 U.S.
545, 554 (1886). In those circumstances, I doubt any of us
would say the passenger’s damages award represented
compensation for “services rendered” to her employer
rather than compensation for her injury. And I don’t see
why we would reach a different result here simply because
the victim of BNSF’s negligence happened to be one of its
own workers. Of course, as the Court points out, ante, at
11, n. 5, FELA suits may be brought only by railroad
employees against their employers. But in cases like ours
a FELA suit simply serves in the interstate railroad in-
dustry as a federalized substitute for a traditional state
negligence tort claim of the sort that could be brought by
anyone the railroad injured, employee or not. Inescapably,
“the basis of liability under [FELA] is and remains negli-
gence.” Wilkerson v. McCarthy, 336 U.S. 53, 69 (1949)
(Douglas, J., concurring).
Looking beyond the statute’s text to its history only
compounds BNSF’s problems. To be clear, the statutory
history I have in mind here isn’t the sort of unenacted
legislative history that often is neither truly legislative
(having failed to survive bicameralism and presentment)
nor truly historical (consisting of advocacy aimed at win-
ning in future litigation what couldn’t be won in past
statutes). Instead, I mean here the record of enacted
changes Congress made to the relevant statutory text over
time, the sort of textual evidence everyone agrees can
sometimes shed light on meaning. See United States v.
6 BNSF R. CO. v. LOOS
GORSUCH, J., dissenting
Wong Kim Ark, 169 U.S. 649, 653–654 (1898).
The RRTA’s statutory history is long and instructive.
Beginning in 1937, the statute defined taxable “compensa-
tion” to include remuneration “for services rendered,” but
with the further instruction that this included compensa-
tion “for time lost.” Carriers Taxing Act of 1937, §1(e), 50
Stat. 436. Courts applying the RRTA’s sister statute, the
Railroad Retirement Act (RRA), understood this language
to capture settlement payments for personal injury claims
that would not otherwise qualify as “remuneration . . . for
services rendered.” See, e.g., Jacques v. Railroad Retire-
ment Bd., 736 F.2d 34, 39–40 (CA2 1984); Grant v. Rail-
road Retirement Bd., 173 F.2d 385, 386–387 (CA10 1949).
Congress itself seemed to agree, explaining in 1946 that
remuneration for “time lost” includes payments made
“with respect to an . . . absence on account of personal
injury.” §3(f), 60 Stat. 725. But then Congress reversed
field. In 1975, it removed payments “for time lost” from
the RRTA’s definition of “compensation.” §204, 89 Stat.
466. And in 1983, Congress overwrote the last remaining
reference to payments “for time lost” in a nearby section.
§225, 97 Stat. 424–426. To my mind, Congress’s decision
to remove the only language that could have fairly cap-
tured the damages here cannot be easily ignored.
Yet BNSF would have us do exactly that. On its ac-
count, the RRTA’s discussions about compensation for
time lost and personal injuries only ever served to illus-
trate what has qualified all along as remuneration for
“services rendered.” So, on its view, when Congress first
added and then removed language about time lost and
personal injuries, it quite literally wasted its time because
none of its additions and subtractions altered the statute’s
meaning. Put another way, BNSF asks us to read back
into the law words (time lost, personal injury) that Con-
gress deliberately removed on the assumption they were
never really needed in the first place. As I see it, that is
Cite as: 586 U. S. ____ (2019) 7
GORSUCH, J., dissenting
less “ ‘a construction of a statute [than] an enlargement of
it by the court, so that what was omitted, [BNSF] pre-
sum[es] by inadvertence, may be included within its scope.
To supply omissions [like that] transcends the judicial
function.’ ” West Virginia Univ. Hospitals, Inc. v. Casey,
499 U.S. 83, 101 (1991) (quoting Iselin v. United States,
270 U.S. 245, 251 (1926) (Brandeis, J.)).
Looking beyond the text and history of this statute to
compare it with others confirms the conclusion. Where
the RRTA directs the taxation of railroad employee income
to fund retirement benefits, the RRA controls the calcula-
tion of those benefits. And, unlike the RRTA, that statute
continues to include “pay for time lost” in the definition of
“compensation” it uses to calculate benefits. 45 U.S. C.
§231(h)(1). Normally, when Congress chooses to exclude
terms in one statute while introducing or retaining them
in another closely related law, we give effect to rather
than pass a blind eye over the difference. Nor is there any
question that Congress knows exactly how to tax a favor-
able tort judgment when it wants. See, e.g., 26 U.S. C.
§104(a)(2) (punitive damages are not deductible). Its
failure to offer any comparably clear command here
should, once more, tell us something.
With so much in the statute’s text, history, and sur-
roundings now pointing for Mr. Loos, BNSF is left to lean
heavily on case law. The company says we must rule its
way primarily because of Social Security Bd. v. Nierotko,
327 U.S. 358 (1946). But I do not see anything in that
case dictating a victory for BNSF. Nierotko concerned a
different statute, a different legal claim, and a different
factual context. There, the plaintiff brought a wrongful
termination claim before the National Labor Relations
Board, claiming that his employer fired him in retaliation
for union activity. The NLRB ordered the employee rein-
stated to his former job and paid as if he had never left.
Under those circumstances, this Court held that for pur-
8 BNSF R. CO. v. LOOS
GORSUCH, J., dissenting
poses of calculating the plaintiff ’s Social Security Act
benefits, his “wages” should include his backpay award,
allocated to the period when he would have been working
but for the employer’s misconduct. Since then, however,
the Court has suggested that at least one of Nierotko’s
holdings was likely motivated more by a policy concern
with protecting the employee’s full retirement to Social
Security benefits than by a careful reading of the Social
Security Act. See United States v. Cleveland Indians
Baseball Co., 532 U.S. 200, 212–213 (2001); id., at 220–
221 (Scalia, J., concurring in judgment). Besides, in this
case we’re simply not faced with a wrongful termination
claim, an award of backpay, or the interpretation of the
Social Security Act—let alone reason to worry that ruling
for Mr. Loos would inequitably shortchange an employee.
So whatever light Nierotko might continue to shed on the
question it faced, and whatever superficial similarities one
might point to here, that decision simply doesn’t dictate an
answer to the question whether a tort victim’s damages for
a physical injury qualify as “compensation for services
rendered” under the RRTA.
By this point BNSF is left with only one argument,
which it treats as no more than a last resort: Chevron
deference. In the past, the briefs and oral argument in
this case likely would have centered on whether we should
defer to the IRS’s administrative interpretation of the
RRTA. After all, the IRS (at least today) agrees with
BNSF’s interpretation that “compensation . . . for services
rendered” includes damages for personal injuries. And the
Chevron doctrine, if it retains any force, would seem to
allow BNSF to parlay any statutory ambiguity into a
colorable argument for judicial deference to the IRS’s view,
regardless of the Court’s best independent understanding
of the law. See Chevron U. S. A. Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837 (1984). Of course, any
Chevron analysis here would be complicated by the gov-
Cite as: 586 U. S. ____ (2019) 9
GORSUCH, J., dissenting
ernment’s change of heart. For if Nierotko is as relevant
as BNSF contends, then it must also be relevant that,
back when Nierotko was decided, the IRS took the view
that the term “wages” in the Social Security Act did not
include backpay awards for wrongful termination. See
327 U.S., at 366–367. And if “wages” don’t include back-
pay awards for wrongful terminations, it’s hard to see how
“compensation . . . for services rendered” might include
damages for an act of negligence. Still, even with the
complications that follow from executive agencies’ pench-
ant for changing their views about the law’s meaning
almost as often as they change administrations, a plea for
deference surely would have enjoyed pride of place in
BNSF’s submission not long ago.
But nothing like that happened here. BNSF devoted
scarcely any of its briefing to Chevron. At oral argument,
BNSF’s lawyer didn’t even mention the case until the final
seconds—and even then “hate[d] to cite” it. Tr. of Oral
Arg. 58. No doubt, BNSF proceeded this way well aware
of the mounting criticism of Chevron deference. See, e.g.,
Pereira v. Sessions, 585 U. S. ___, ___–___ (2018) (Kenne-
dy, J., concurring). And no doubt, too, this is all to the
good. Instead of throwing up our hands and letting an
interested party—the federal government’s executive
branch, no less—dictate an inferior interpretation of the
law that may be more the product of politics than a scru-
pulous reading of the statute, the Court today buckles
down to its job of saying what the law is in light of its text,
its context, and our precedent. Though I may disagree
with the result the Court reaches, my colleagues rightly
afford the parties before us an independent judicial inter-
pretation of the law. They deserve no less | BNSF Railway’s negligence caused one of its employees a serious injury. After a trial, a court ordered the company to pay damages. But instead of sending the full amount to the employee, BNSF asserted that it had to divert a portion to the Internal Revenue Service. Why? BNSF said the money represented taxable “compensation” for “services rendered as an employee.” 26 U.S. C. Today, the Court agrees with the company. Respectfully, I do not. When an employee suffers a physical injury due to his employer’s negligence and has to sue in court to recover damages, it seems more natural to me to describe the final judgment as compensation for his injury than for services (never) rendered. The Court does not lay out the facts of the case, but they are relevant to my analysis and straightforward enough. Years ago, Michael Loos was working for BNSF in a train yard when he fell into a hidden drainage grate and injured his knee. He missed work for many months, and upon his return he had a series of absences, many of which he attributed to knee-injury flareups. When the company moved to fire him for allegedly violating its attendance policies, Mr. Loos sued. Among other things, Mr. Loos sought damages for BNSF’s negligence in maintaining the 2 BNSF R. CO. v. LOOS GORSUCH, J., dissenting train yard. He brought his claim under the Federal Employers’ Liability Act (FELA), an analogue to tradititional state-law tort suits that makes an interstate railroad “liable in damages to any person suffering injury while he is employed” by the railroad “for such injury resulting in whole or in part from the [railroad’s] negligence.” 45 U.S. C. Ultimately, and again much like in any other tort suit, the jury awarded damages in three categories: $85,000 in pain and suffering, $11,212.78 in medical expenses, and $30,000 in lost wages—the final category representing the amount Mr. Loos was unable to earn because of the injury BNSF’s negligence caused. Then a strange thing happened. BNSF argued that the lost wages portion of Mr. Loos’s judgment represented “compensation” to him “for services rendered as an employee” and was thus taxable income under the Railroad Retirement Tax Act (RRTA). 26 U.S. C. et seq. In much the same way the Social Security Act taxes other citizens’ incomes to fund their retirement benefits, the RRTA taxes railroad employees’ earnings to pay for their public pensions. And BNSF took the view that, because Mr. Loos owed the IRS taxes on the lost wages portion of his judgment, it had to withhold an appropriate sum and redirect it to the government. The company took this position even though it meant BNSF would owe corresponding excise taxes. See 26 U.S. C. It took this position, too, even though no one has identified for us a single case where the IRS has sought to collect RRTA taxes on a FELA judgment in the 80 years the two statutes have coexisted. The company even persisted in its view after, first, the district court and, then, the Eighth Circuit ruled that Mr. Loos’s award wasn’t subject to RRTA taxes. Even after all that, BNSF went to the trouble of seeking review in this Court to win the right to pay the IRS. What’s the reason for BNSF’s tireless campaign? Is the Cite as: 586 U. S. (2019) 3 GORSUCH, J., dissenting company really moved by a selfless desire to protect a federal program from “a long-term risk of insolvency”? See ante, at 5, n. 2. Several amici offer a more prosaic possibility. Under the rule BNSF seeks and wins today, RRTA taxes will be due on (but only on) the portion of a FELA settlement or judgment designated as lost wages. Taxes will not attach to other amounts attributed to, say, pain and suffering or medical costs. At trial, of course, a plaintiff ’s damages are what they are, and often juries will attribute a significant portion of damages to lost wages. But with the help of the asymmetric tax treatment they secure today, railroads like BSNF can now sweeten their settlement offers while offering less money. Forgo trial and accept a lower settlement, they will tell injured workers, and in return we will designate a small fraction (maybe even none) of the payments as taxable lost wages. In this way, the Court’s decision today may do precisely nothing to increase the government’s tax collections or protect the solvency of any federal program. Instead, it may only mean that employees will pay a tax for going to trial—and railroads will succeed in buying cheaper settlements in the future at the bargain basement price of a few thousand dollars in excise taxes in one case today. See Brief for American Association for Justice as Amicus Curiae 34–36; Brief for SMART et al. as Amici Curiae 5–7. Whatever the reason for BNSF’s gambit, the problems with it start for me at the first step of the statutory interpretation analysis—with the text of the law itself. The RRTA taxes an employee’s “compensation,” which it defines as “money remuneration for services rendered as an employee to one or more employers.” 26 U.S. C. A “service” refers to “duty or labor by one person bound to submit his will to the direction and control of [another].” Black’s Law Dictionary 1607 (3d ed. 1933). And “remuneration” means “a quid pro quo,” “rec- ompense” or “reward” for such services. So 4 BNSF R. CO. v. LOOS GORSUCH, J., dissenting the words “remuneration for services rendered” naturally cover things like an employee’s salary or hourly wage. Nor do they stop there, as the Court correctly notes. Rather, and contrary to the court of appeals’ view, those words also fairly encompass benefits like sick or disability pay. After all, an employer offers those benefits to attract and keep employees working on its behalf. In that way, these benefits form part of the “quid pro quo” (compensa- tion) the employer pays to secure the “duty or labor” (ser- vices) the employee renders. Cf. United But damages for negligence are different. No one would describe a dangerous fall or the wrenching of a knee as a “service rendered” to the party who negligently caused the accident. BNSF hardly directed Mr. Loos to fall or offered to pay him for doing so. In fact, BNSF didn’t even pay Mr. Loos voluntarily; he had to wrest a judgment from the railroad at the end of a legal battle. So Mr. Loos’s FELA judgment seems to me, as it did to every judge in the proceedings below, unconnected to any service Mr. Loos rendered to BNSF. Instead of being “compensation” for “services rendered as an employee,” it seems more natural to say that the negligence damages BNSF paid are “com- pensation” to Mr. Loos for his injury. That’s exactly how we usually understand tort damages—as “compensation” for an “injury” caused by “the unlawful act or omission or negligence of another.” Black’s Law Dictionary 314 (2d ed. 1910). And that’s exactly how FELA describes the damages it provides—stating that it renders a railroad “liable” not for services rendered but for any “injury” caused by the defendant’s “negligence.” 45 U.S. C. see also New York Central R. (Brandeis, J., dissenting) (FELA liability is “a penalty for wrong doing,” a “remedy” that “mak[es] the wrongdoer indemnify him whom he has wronged”). Of course, BNSF isn’t without a reply. Time and again Cite as: 586 U. S. (2019) 5 GORSUCH, J., dissenting it highlights the fact that the district court measured the lost wages portion of Mr. Loos’s award by reference to what he could have earned but for his injury. But if BNSF’s negligence had injured a passenger on a train instead of an employee in a train yard, a jury could have measured the passenger’s tort damages in exactly the same way, taking account of the wages she could have earned from her own employer but for the railroad’s negli- gence. Vicksburg & Meridian R. Co. v. Putnam, 118 U.S. 545, 554 (1886). In those circumstances, I doubt any of us would say the passenger’s damages award represented compensation for “services rendered” to her employer rather than compensation for her injury. And I don’t see why we would reach a different result here simply because the victim of BNSF’s negligence happened to be one of its own workers. Of course, as the Court points out, ante, at 11, n. 5, FELA suits may be brought only by railroad employees against their employers. But in cases like ours a FELA suit simply serves in the interstate railroad in- dustry as a federalized substitute for a traditional state negligence tort claim of the sort that could be brought by anyone the railroad injured, employee or not. Inescapably, “the basis of liability under [FELA] is and remains negli- gence.” (Douglas, J., concurring). Looking beyond the statute’s text to its history only compounds BNSF’s problems. To be clear, the statutory history I have in mind here isn’t the sort of unenacted legislative history that often is neither truly legislative (having failed to survive bicameralism and presentment) nor truly historical (consisting of advocacy aimed at win- ning in future litigation what couldn’t be won in past statutes). Instead, I mean here the record of enacted changes Congress made to the relevant statutory text over time, the sort of textual evidence everyone agrees can sometimes shed light on meaning. See United States v. 6 BNSF R. 1 U.S. 649, The RRTA’s statutory history is long and instructive. Beginning in 1937, the statute defined taxable “compensa- tion” to include remuneration “for services rendered,” but with the further instruction that this included compensa- tion “for time lost.” Carriers Taxing Act of 1937, 50 Stat. 436. Courts applying the RRTA’s sister statute, the Railroad Retirement Act (RRA), understood this language to capture settlement payments for personal injury claims that would not otherwise qualify as “remuneration for services rendered.” See, e.g., ; Congress itself seemed to agree, explaining in 1946 that remuneration for “time lost” includes payments made “with respect to an absence on account of personal injury.” But then Congress reversed field. In 1975, it removed payments “for time lost” from the RRTA’s definition of “compensation.” 89 Stat. 466. And in 1983, Congress overwrote the last remaining reference to payments “for time lost” in a nearby section. –426. To my mind, Congress’s decision to remove the only language that could have fairly cap- tured the damages here cannot be easily ignored. Yet BNSF would have us do exactly that. On its ac- count, the RRTA’s discussions about compensation for time lost and personal injuries only ever served to illus- trate what has qualified all along as remuneration for “services rendered.” So, on its view, when Congress first added and then removed language about time lost and personal injuries, it quite literally wasted its time because none of its additions and subtractions altered the statute’s meaning. Put another way, BNSF asks us to read back into the law words (time lost, personal injury) that Con- gress deliberately removed on the assumption they were never really needed in the first place. As I see it, that is Cite as: 586 U. S. (2019) 7 GORSUCH, J., dissenting less “ ‘a construction of a statute [than] an enlargement of it by the court, so that what was omitted, [BNSF] pre- sum[es] by inadvertence, may be included within its scope. To supply omissions [like that] transcends the judicial function.’ ” West Virginia Univ. Hospitals, ). Looking beyond the text and history of this statute to compare it with others confirms the conclusion. Where the RRTA directs the taxation of railroad employee income to fund retirement benefits, the RRA controls the calcula- tion of those benefits. And, unlike the RRTA, that statute continues to include “pay for time lost” in the definition of “compensation” it uses to calculate benefits. 45 U.S. C. Normally, when Congress chooses to exclude terms in one statute while introducing or retaining them in another closely related law, we give effect to rather than pass a blind eye over the difference. Nor is there any question that Congress knows exactly how to tax a favor- able tort judgment when it wants. See, e.g., 26 U.S. C. (punitive damages are not deductible). Its failure to offer any comparably clear command here should, once more, tell us something. With so much in the statute’s text, history, and sur- roundings now pointing for Mr. Loos, BNSF is left to lean heavily on case law. The company says we must rule its way primarily because of Social Security But I do not see anything in that case dictating a victory for BNSF. Nierotko concerned a different statute, a different legal claim, and a different factual context. There, the plaintiff brought a wrongful termination claim before the National Labor Relations Board, claiming that his employer fired him in retaliation for union activity. The NLRB ordered the employee rein- stated to his former job and paid as if he had never left. Under those circumstances, this Court held that for pur- 8 BNSF R. CO. v. LOOS GORSUCH, J., dissenting poses of calculating the plaintiff ’s Social Security Act benefits, his “wages” should include his backpay award, allocated to the period when he would have been working but for the employer’s misconduct. Since then, however, the Court has suggested that at least one of Nierotko’s holdings was likely motivated more by a policy concern with protecting the employee’s full retirement to Social Security benefits than by a careful reading of the Social Security Act. See United ; at 220– 221 (Scalia, J., concurring in judgment). Besides, in this case we’re simply not faced with a wrongful termination claim, an award of backpay, or the interpretation of the Social Security Act—let alone reason to worry that ruling for Mr. Loos would inequitably shortchange an employee. So whatever light Nierotko might continue to shed on the question it faced, and whatever superficial similarities one might point to here, that decision simply doesn’t dictate an answer to the question whether a tort victim’s damages for a physical injury qualify as “compensation for services rendered” under the RRTA. By this point BNSF is left with only one argument, which it treats as no more than a last resort: Chevron deference. In the past, the briefs and oral argument in this case likely would have centered on whether we should defer to the IRS’s administrative interpretation of the RRTA. After all, the IRS (at least today) agrees with BNSF’s interpretation that “compensation for services rendered” includes damages for personal injuries. And the Chevron doctrine, if it retains any force, would seem to allow BNSF to parlay any statutory ambiguity into a colorable argument for judicial deference to the IRS’s view, regardless of the Court’s best independent understanding of the law. See Chevron U. S. A. Of course, any Chevron analysis here would be complicated by the gov- Cite as: 586 U. S. (2019) 9 GORSUCH, J., dissenting ernment’s change of heart. For if Nierotko is as relevant as BNSF contends, then it must also be relevant that, back when Nierotko was decided, the IRS took the view that the term “wages” in the Social Security Act did not include backpay awards for wrongful termination. See –367. And if “wages” don’t include back- pay awards for wrongful terminations, it’s hard to see how “compensation for services rendered” might include damages for an act of negligence. Still, even with the complications that follow from executive agencies’ pench- ant for changing their views about the law’s meaning almost as often as they change administrations, a plea for deference surely would have enjoyed pride of place in BNSF’s submission not long ago. But nothing like that happened here. BNSF devoted scarcely any of its briefing to Chevron. At oral argument, BNSF’s lawyer didn’t even mention the case until the final seconds—and even then “hate[d] to cite” it. Tr. of Oral Arg. 58. No doubt, BNSF proceeded this way well aware of the mounting criticism of Chevron deference. See, e.g., Pereira v. Sessions, 585 U. S. – (2018) (Kenne- dy, J., concurring). And no doubt, too, this is all to the good. Instead of throwing up our hands and letting an interested party—the federal government’s executive branch, no less—dictate an inferior interpretation of the law that may be more the product of politics than a scru- pulous reading of the statute, the Court today buckles down to its job of saying what the law is in light of its text, its context, and our precedent. Though I may disagree with the result the Court reaches, my colleagues rightly afford the parties before us an independent judicial inter- pretation of the law. They deserve no less |
Justice Burger | concurring | false | Dunlop v. Bachowski | 1975-06-02T00:00:00 | null | https://www.courtlistener.com/opinion/109260/dunlop-v-bachowski/ | https://www.courtlistener.com/api/rest/v3/clusters/109260/ | 1,975 | 1974-107 | 2 | 8 | 1 | I join the opinion of the Court with the understanding that the Court has fashioned an exceedingly narrow scope of review of the Secretary's determination not to bring an action on behalf of a complainant to set aside an election. The language and purposes of § 401 of the Labor-Management Reporting and Disclosure Act of 1959, 73 Stat. 532, 29 U.S. C. § 481, have required the Court to define a scope of review much narrower than applies under 5 U.S. C. § 706 (2) (A) in most other administrative areas. The Court's holding must be read as providing that the determination of the Secretary not to challenge a union election may be held arbitrary and capricious only where the Secretary's investigation, as evidenced by his statement of reasons, shows election irregularities *591 that affected its outcome as to the complainant, Wirtz v. Bottle Blowers Assn., 389 U.S. 463, 472 (1968), and that notwithstanding the illegal conduct so found the Secretary nevertheless refuses to bring an action and advances no rational reason for his decision.
MR. JUSTICE REHNQUIST, concurring in the result in part and dissenting in part.
The parties to this case will have to be excused if they react with surprise to the opinion of the Court. Instead of deciding the issue presented in the Secretary of Labor's petition for certiorari, the Court decides an issue about which the parties no longer disagree; to compound the confusion, the reasoning adopted by the Court to resolve the issue it does decide is quite unusual unless it is intended to foreshadow disposition of the issue upon which the Court purports to reserve judgment.
I
After exhausting intraunion remedies, respondent filed a complaint with the Secretary of Labor alleging violations of § 401 of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), 73 Stat. 532, 29 U.S. C. § 481. The Secretary conducted an investigation and concluded that no civil action to set aside the challenged election was warranted. Respondent was so notified,[*] and he then sought to challenge the Secretary's *592 refusal to file suit. The complaint alleged that the Secretary had refused to file suit, "[n]otwithstanding the fact that the Defendant Secretary's investigation has substantiated the [respondent's] allegations," and that respondent "has not been given a statement of reasons why the Defendant Secretary will not file suit." App. 5A. Respondent asked the court to order the Secretary to file suit to set aside the election and "direct the Defendant Secretary to make available for examination by the [respondent] all evidence it has obtained concerning its investigation of the aforesaid election." Id., at 6A. The Court of Appeals, reversing the District Court, held that the Secretary's refusal to file an action to set aside the election was judicially reviewable. In considering "the proper scope of such judicial review," the Court of Appeals concluded that the Secretary should prepare a statement of reasons, presumably to assist in judicial review and also to ensure that proper deference was paid to the Secretary's determinations. 502 F.2d 79, 88-89 (CA3 1974).
Notwithstanding contrary verbiage, the approach of this Court is not materially different. The Court expressly reserves "the question whether the district court is empowered to order the Secretary to bring a civil suit against the union to set aside the election," ante, at 575, but its justification for ordering the Secretary to provide a statement of reasons appears premised upon an affirmative disposition of the reserved question: the Secretary must provide a statement of reasons "to enable the reviewing court intelligently to review the Secretary's determination," ante, at 571. I cannot subscribe to judicial reasoning of this convoluted sort.
*593 II
In the first place, whether or not a statement of reasons must be supplied by the Secretary is not an issue presented by this case. The single question presented by the Secretary's petition for certiorari is:
"Whether a disappointed union office seeker may invoke the judicial process to compel the Secretary of Labor to bring an action under Title IV of the Labor-Management Reporting and Disclosure Act of 1959 to set aside a union election." Pet. for Cert. 2.
The Secretary did not seek review of the holding by the Court of Appeals that a statement of reasons was required but instead proceeded to comply with that portion of the appellate court's holding by filing the statement of reasons that is appended to the opinion of the Court. As the Secretary states: "We do not contest this portion of the court's holding." Brief for Petitioner 5 n. 2.
Such a concession appears well founded, although not for the reasons stated by the Court. Independent of any connection with judicial review, a statement of reasons is required by statute. The Administrative Procedure Act (APA), which is applicable to the LMRDA, 29 U.S. C. § 526, states:
"Prompt notice shall be given of the denial in whole or in part of a written application, petition, or other request of an interested person made in connection with any agency proceedings. Except in affirming a prior denial or when the denial is selfexplanatory, the notice shall be accompanied by a brief statement of the grounds for denial." 5 U.S. C. § 555 (e).
See S. Doc. No. 248, 79th Cong., 2d Sess., 206, 265 (1946). Here, where the Secretary is charged with the *594 responsibility of enforcing the rights of individual union members and has established a procedure for the filing of a complaint with him by such members, § 555 (e) would appear to be applicable.
The acquiescence of the Secretary has removed this issue from the case. Since the majority persists in deciding it, I concur in the result on the basis of the APA, which is not dependent upon the availability of judicial review. This ground, in my view, furnishes a sounder reason for concluding that a statement of reasons must be furnished than does the reasoning of the Court.
III
It remains to consider the only question presented by the Secretary's petition for certiorari: Is judicial review available at the behest of respondent to force the Secretary to file a civil action to set aside the union election?
Respondent does not rely upon any provision of the LMRDA as authorizing this post-election lawsuit, for indeed there is none. Instead, respondent relies upon the APA judicial-review provisions, 5 U.S. C. §§ 701-706. App. 3A. The judicial-review provisions of the APA do not apply, however, "to the extent that(1) statutes preclude judicial review; or (2) agency action is committed to agency discretion by law." 5 U.S. C. § 701 (a).
I agree with the Court that 29 U.S. C. § 483 does not preclude judicial review of the kind sought in this case. That section expresses the congressional judgment that the civil action filed by the Secretary under 29 U.S. C. § 482 (b) shall be the exclusive remedy "for challenging an election already conducted." Respondent recognizes that this Court's decision in Calhoon v. Harvey, 379 U.S. 134 (1964), precludes him from proceeding directly *595 against the union, a result that I believe is compelled by § 483. But § 483 is silent about the availability of relief to force the Secretary to pursue the remedy that is exclusively his, and under this Court's decisions a prohibition of judicial review is not to be lightly inferred. Abbott Laboratories v. Gardner, 387 U.S. 136, 140-141 (1967).
I reach a contrary conclusion, however, with regard to the second clause of § 701 (a). It seems to me that prior decisions of this Court establish that the Secretary's decision to file or not to file a complaint under § 482 is precisely the kind of "agency action . . . committed to agency discretion by law" exempted from the judicial-review provisions of the APA.
In LMRDA cases, this Court has repeatedly recognized the exclusive role in post-election challenges played by the Secretary. In Calhoon v. Harvey, supra, at 140-141 (footnote omitted), we said:
"Section 402 of Title IV, as has been pointed out, sets up an exclusive method for protecting Title IV rights, by permitting an individual member to file a complaint with the Secretary of Labor challenging the validity of any election because of violations of Title IV. Upon complaint the Secretary investigates and if he finds probable cause to believe that Title IV has been violated, he may file suit in the appropriate district court. It is apparent that Congress decided to utilize the special knowledge and discretion of the Secretary of Labor in order best to serve the public interest. . . . In so doing Congress, with one exception not here relevant, decided not to permit individuals to block or delay union elections by filing federal-court suits for violations of Title IV. Reliance on the discretion of the Secretary is in harmony with the general congressional policy to allow *596 unions great latitude in resolving their own internal controversies, and, where that fails, to utilize the agencies of Government most familiar with union problems to aid in bringing about a settlement through discussion before resort to the courts. Without setting out the lengthy legislative history which preceded the passage of this measure, it is sufficient to say that we are satisfied that the Act itself shows clearly by its structure and language that the disputes here, basically relating as they do to eligibility of candidates for office, fall squarely within Title IV of the Act and are to be resolved by the administrative and judicial procedures set out in that Title." (Emphasis added.)
See also Wirtz v. Bottle Blowers Assn., 389 U.S. 463, 473-474 (1968). More recently, in Trbovich v. Mine Workers, 404 U.S. 528 (1972), we said, in the context of claims presented by an intervenor that had not been included in the Secretary's complaint:
"With respect to litigation by union members, then, the legislative history supports the conclusion that Congress intended to prevent members from pressing claims not thought meritorious by the Secretary, and from litigating in forums or at times different from those chosen by the Secretary. . . .
.....
". . . [W]e think Congress intended to insulate the union from any complaint that did not appear meritorious to both a complaining member and the Secretary. Accordingly, we hold that in a post-election enforcement suit, Title IV imposes no bar to intervention by a union member, so long as that intervention is limited to the claims of illegality presented by the Secretary's complaint." Id., at 536-537 (footnote omitted; emphasis added).
*597 The exclusivity of the Secretary's role in the enforcement of Title IV rights is no accident. It represents a conscious legislative compromise adopted to balance two important but conflicting interests: vindication of the rights of union members and freedom of unions from undue harassment. See Bottle Blowers, supra, at 470-471. This Court has recognized unreviewable discretion both in the labor area, Vaca v. Sipes, 386 U.S. 171, 182 (1967), and in other civil areas, The Confiscation Cases, 7 Wall. 454 (1869); FTC v. Klesner, 280 U.S. 19, 25 (1929). The Court of Appeals sought to distinguish this line of cases on the grounds that it involved "vindication of societal or governmental interest, rather than the protection of individual rights," 502 F.2d, at 87. While the Secretary points out the artificiality of this purported distinction and refutes it as applied to these cases, Brief for Petitioner 30, a more basic response is that such considerations provide no basis for contravention of legislative intent:
"Congress for reasons of its own decided upon the method for the protection of the `right' which it created. It selected the precise machinery and fashioned the tool which it deemed suited to that end. . . . All constitutional questions aside, it is for Congress to determine how the rights which it creates shall be enforced." Switchmen's Union v. National Mediation Board, 320 U.S. 297, 301 (1943).
The Court recognizes the power of these arguments, if only by understatement, when it acknowledges that any argument for judicial review of the Secretary's determination "obviously presents some difficulty in light of the strong evidence that Congress deliberately gave exclusive enforcement authority to the Secretary." Ante, at 575 (footnote omitted). In my view the parties to this *598 litigation are entitled to adjudication of the issue upon which this Court granted certiorari. I would accordingly reverse the judgment of the Court of Appeals insofar as it held that the Secretary's refusal to institute an action under 29 U.S. C. § 482 is judicially reviewable under the provisions of the APA, 5 U.S. C. §§ 701-706.
| I join the opinion of the Court with the understanding that the Court has fashioned an exceedingly narrow scope of review of the Secretary's determination not to bring an action on behalf of a complainant to set aside an election. The language and purposes of 401 of the Labor-Management Reporting and Disclosure Act of 1959, 29 U.S. C. 481, have required the Court to define a scope of review much narrower than applies under 5 U.S. C. 706 (2) (A) in most other administrative areas. The Court's holding must be read as providing that the determination of the Secretary not to challenge a union election may be held arbitrary and capricious only where the Secretary's investigation, as evidenced by his statement of reasons, shows election irregularities *591 that affected its outcome as to the complainant, and that notwithstanding the illegal conduct so found the Secretary nevertheless refuses to bring an action and advances no rational reason for his decision. MR. JUSTICE REHNQUIST, concurring in the result in part and dissenting in part. The parties to this case will have to be excused if they react with surprise to the opinion of the Court. Instead of deciding the issue presented in the Secretary of Labor's petition for certiorari, the Court decides an issue about which the parties no longer disagree; to compound the confusion, the reasoning adopted by the Court to resolve the issue it does decide is quite unusual unless it is intended to foreshadow disposition of the issue upon which the Court purports to reserve judgment. I After exhausting intraunion remedies, respondent filed a complaint with the Secretary of Labor alleging violations of 401 of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), 29 U.S. C. 481. The Secretary conducted an investigation and concluded that no civil action to set aside the challenged election was warranted. Respondent was so notified,[*] and he then sought to challenge the Secretary's *592 refusal to file suit. The complaint alleged that the Secretary had refused to file suit, "[n]otwithstanding the fact that the Defendant Secretary's investigation has substantiated the [respondent's] allegations," and that respondent "has not been given a statement of reasons why the Defendant Secretary will not file suit." App. 5A. Respondent asked the court to order the Secretary to file suit to set aside the election and "direct the Defendant Secretary to make available for examination by the [respondent] all evidence it has obtained concerning its investigation of the aforesaid election." at 6A. The Court of Appeals, reversing the District Court, held that the Secretary's refusal to file an action to set aside the election was judicially reviewable. In considering "the proper scope of such judicial review," the Court of Appeals concluded that the Secretary should prepare a statement of reasons, presumably to assist in judicial review and also to ensure that proper deference was paid to the Secretary's determinations. Notwithstanding contrary verbiage, the approach of this Court is not materially different. The Court expressly reserves "the question whether the district court is empowered to order the Secretary to bring a civil suit against the union to set aside the election," ante, at 575, but its justification for ordering the Secretary to provide a statement of reasons appears premised upon an affirmative disposition of the reserved question: the Secretary must provide a statement of reasons "to enable the reviewing court intelligently to review the Secretary's determination," ante, at 571. I cannot subscribe to judicial reasoning of this convoluted sort. *593 II In the first place, whether or not a statement of reasons must be supplied by the Secretary is not an issue presented by this case. The single question presented by the Secretary's petition for certiorari is: "Whether a disappointed union office seeker may invoke the judicial process to compel the Secretary of Labor to bring an action under Title IV of the Labor-Management Reporting and Disclosure Act of 1959 to set aside a union election." Pet. for Cert. 2. The Secretary did not seek review of the holding by the Court of Appeals that a statement of reasons was required but instead proceeded to comply with that portion of the appellate court's holding by filing the statement of reasons that is appended to the opinion of the Court. As the Secretary states: "We do not contest this portion of the court's holding." Brief for Petitioner 5 n. 2. Such a concession appears well founded, although not for the reasons stated by the Court. Independent of any connection with judicial review, a statement of reasons is required by statute. The Administrative Procedure Act (APA), which is applicable to the LMRDA, 29 U.S. C. 526, states: "Prompt notice shall be given of the denial in whole or in part of a written application, petition, or other request of an interested person made in connection with any agency proceedings. Except in affirming a prior denial or when the denial is selfexplanatory, the notice shall be accompanied by a brief statement of the grounds for denial." 5 U.S. C. 555 (e). See S. Doc. No. 248, 79th Cong., 2d Sess., 206, 265 (1946). Here, where the Secretary is charged with the *594 responsibility of enforcing the rights of individual union members and has established a procedure for the filing of a complaint with him by such members, 555 (e) would appear to be applicable. The acquiescence of the Secretary has removed this issue from the case. Since the majority persists in deciding it, I concur in the result on the basis of the APA, which is not dependent upon the availability of judicial review. This ground, in my view, furnishes a sounder reason for concluding that a statement of reasons must be furnished than does the reasoning of the Court. III It remains to consider the only question presented by the Secretary's petition for certiorari: Is judicial review available at the behest of respondent to force the Secretary to file a civil action to set aside the union election? Respondent does not rely upon any provision of the LMRDA as authorizing this post-election lawsuit, for indeed there is none. Instead, respondent relies upon the APA judicial-review provisions, 5 U.S. C. 701-706. App. 3A. The judicial-review provisions of the APA do not apply, however, "to the extent that(1) statutes preclude judicial review; or (2) agency action is committed to agency discretion by law." 5 U.S. C. 701 (a). I agree with the Court that 29 U.S. C. 483 does not preclude judicial review of the kind sought in this case. That section expresses the congressional judgment that the civil action filed by the Secretary under 29 U.S. C. 482 (b) shall be the exclusive remedy "for challenging an election already conducted." Respondent recognizes that this Court's decision in precludes him from proceeding directly *595 against the union, a result that I believe is compelled by 483. But 483 is silent about the availability of relief to force the Secretary to pursue the remedy that is exclusively his, and under this Court's decisions a prohibition of judicial review is not to be lightly inferred. Abbott I reach a contrary conclusion, however, with regard to the second clause of 701 (a). It seems to me that prior decisions of this Court establish that the Secretary's decision to file or not to file a complaint under 482 is precisely the kind of "agency action committed to agency discretion by law" exempted from the judicial-review provisions of the APA. In LMRDA cases, this Court has repeatedly recognized the exclusive role in post-election challenges played by the Secretary. In at we said: "Section 402 of Title IV, as has been pointed out, sets up an exclusive method for protecting Title IV rights, by permitting an individual member to file a complaint with the Secretary of Labor challenging the validity of any election because of violations of Title IV. Upon complaint the Secretary investigates and if he finds probable cause to believe that Title IV has been violated, he may file suit in the appropriate district court. It is apparent that Congress decided to utilize the special knowledge and discretion of the Secretary of Labor in order best to serve the public interest. In so doing Congress, with one exception not here relevant, decided not to permit individuals to block or delay union elections by filing federal-court suits for violations of Title IV. Reliance on the discretion of the Secretary is in harmony with the general congressional policy to allow *596 unions great latitude in resolving their own internal controversies, and, where that fails, to utilize the agencies of Government most familiar with union problems to aid in bringing about a settlement through discussion before resort to the courts. Without setting out the lengthy legislative history which preceded the passage of this measure, it is sufficient to say that we are satisfied that the Act itself shows clearly by its structure and language that the disputes here, basically relating as they do to eligibility of candidates for office, fall squarely within Title IV of the Act and are to be resolved by the administrative and judicial procedures set out in that Title." (Emphasis added.) See also More recently, in we said, in the context of claims presented by an intervenor that had not been included in the Secretary's complaint: "With respect to litigation by union members, then, the legislative history supports the conclusion that Congress intended to prevent members from pressing claims not thought meritorious by the Secretary, and from litigating in forums or at times different from those chosen by the Secretary. ". [W]e think Congress intended to insulate the union from any complaint that did not appear meritorious to both a complaining member and the Secretary. Accordingly, we hold that in a post-election enforcement suit, Title IV imposes no bar to intervention by a union member, so long as that intervention is limited to the claims of illegality presented by the Secretary's complaint." *597 The exclusivity of the Secretary's role in the enforcement of Title IV rights is no accident. It represents a conscious legislative compromise adopted to balance two important but conflicting interests: vindication of the rights of union members and freedom of unions from undue harassment. See Bottle This Court has recognized unreviewable discretion both in the labor area, and in other civil areas, The Confiscation Cases, ; The Court of Appeals sought to distinguish this line of cases on the grounds that it involved "vindication of societal or governmental interest, rather than the protection of individual rights," While the Secretary points out the artificiality of this purported distinction and refutes it as applied to these cases, Brief for Petitioner 30, a more basic response is that such considerations provide no basis for contravention of legislative intent: "Congress for reasons of its own decided upon the method for the protection of the `right' which it created. It selected the precise machinery and fashioned the tool which it deemed suited to that end. All constitutional questions aside, it is for Congress to determine how the rights which it creates shall be enforced." Switchmen's The Court recognizes the power of these arguments, if only by understatement, when it acknowledges that any argument for judicial review of the Secretary's determination "obviously presents some difficulty in light of the strong evidence that Congress deliberately gave exclusive enforcement authority to the Secretary." Ante, at 575 In my view the parties to this *598 litigation are entitled to adjudication of the issue upon which this Court granted certiorari. I would accordingly reverse the judgment of the Court of Appeals insofar as it held that the Secretary's refusal to institute an action under 29 U.S. C. 482 is judicially reviewable under the provisions of the APA, 5 U.S. C. 701-706. |
Justice Stevens | majority | false | Chevron USA Inc. v. Natural Resources Defense Council, Inc. | 1984-06-25T00:00:00 | null | https://www.courtlistener.com/opinion/111221/chevron-usa-inc-v-natural-resources-defense-council-inc/ | https://www.courtlistener.com/api/rest/v3/clusters/111221/ | 1,984 | 1983-134 | 1 | 6 | 0 | In the Clean Air Act Amendments of 1977, Pub. L. 95-95, 91 Stat. 685, Congress enacted certain requirements applicable *840 to States that had not achieved the national air quality standards established by the Environmental Protection Agency (EPA) pursuant to earlier legislation. The amended Clean Air Act required these "nonattainment" States to establish a permit program regulating "new or modified major stationary sources" of air pollution. Generally, a permit may not be issued for a new or modified major stationary source unless several stringent conditions are met.[1] The EPA regulation promulgated to implement this permit requirement allows a State to adopt a plantwide definition of the term "stationary source."[2] Under this definition, an existing plant that contains several pollution-emitting devices may install or modify one piece of equipment without meeting the permit conditions if the alteration will not increase the total emissions from the plant. The question presented by these cases is whether EPA's decision to allow States to treat all of the pollution-emitting devices within the same industrial grouping as though they were encased within a single "bubble" is based on a reasonable construction of the statutory term "stationary source."
I
The EPA regulations containing the plantwide definition of the term stationary source were promulgated on October *841 14, 1981. 46 Fed. Reg. 50766. Respondents[3] filed a timely petition for review in the United States Court of Appeals for the District of Columbia Circuit pursuant to 42 U.S. C. § 7607(b)(1).[4] The Court of Appeals set aside the regulations. National Resources Defense Council, Inc. v. Gorsuch, 222 U. S. App. D. C. 268, 685 F.2d 718 (1982).
The court observed that the relevant part of the amended Clean Air Act "does not explicitly define what Congress envisioned as a `stationary source, to which the permit program. . . should apply," and further stated that the precise issue was not "squarely addressed in the legislative history." Id., at 273, 685 F.2d, at 723. In light of its conclusion that the legislative history bearing on the question was "at best contradictory," it reasoned that "the purposes of the nonattainment program should guide our decision here." Id., at 276, n. 39, 685 F.2d, at 726, n. 39.[5] Based on two of its precedents concerning the applicability of the bubble concept to certain Clean Air Act programs,[6] the court stated that the bubble concept was "mandatory" in programs designed merely to maintain existing air quality, but held that it was "inappropriate" in programs enacted to improve air quality. Id., at 276, 685 F.2d, at 726. Since the purpose of the permit *842 program its "raison d'etre," in the court's view was to improve air quality, the court held that the bubble concept was inapplicable in these cases under its prior precedents. Ibid. It therefore set aside the regulations embodying the bubble concept as contrary to law. We granted certiorari to review that judgment, 461 U.S. 956 (1983), and we now reverse.
The basic legal error of the Court of Appeals was to adopt a static judicial definition of the term "stationary source" when it had decided that Congress itself had not commanded that definition. Respondents do not defend the legal reasoning of the Court of Appeals.[7] Nevertheless, since this Court reviews judgments, not opinions,[8] we must determine whether the Court of Appeals' legal error resulted in an erroneous judgment on the validity of the regulations.
II
When a court reviews an agency's construction of the statute which it administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, *843 as well as the agency, must give effect to the unambiguously expressed intent of Congress.[9] If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute,[10] as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute.[11]
"The power of an administrative agency to administer a congressionally created . . . program necessarily requires the formulation of policy and the making of rules to fill any gap left, implicitly or explicitly, by Congress." Morton v. Ruiz, 415 U.S. 199, 231 (1974). If Congress has explicitly left a gap for the agency to fill, there is an express delegation *844 of authority to the agency to elucidate a specific provision of the statute by regulation. Such legislative regulations are given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute.[12] Sometimes the legislative delegation to an agency on a particular question is implicit rather than explicit. In such a case, a court may not substitute its own construction of a statutory provision for a reasonable interpretation made by the administrator of an agency.[13]
We have long recognized that considerable weight should be accorded to an executive department's construction of a statutory scheme it is entrusted to administer,[14] and the principle of deference to administrative interpretations
"has been consistently followed by this Court whenever decision as to the meaning or reach of a statute has involved reconciling conflicting policies, and a full understanding of the force of the statutory policy in the given situation has depended upon more than ordinary knowledge respecting the matters subjected to agency regulations. See, e. g., National Broadcasting Co. v. United States, 319 U.S. 190; Labor Board v. Hearst Publications, Inc., 322 U.S. 111; Republic Aviation Corp. v. *845 Labor Board, 324 U.S. 793; Securities & Exchange Comm'n v. Chenery Corp., 332 U.S. 194; Labor Board v. Seven-Up Bottling Co., 344 U.S. 344.
". . . If this choice represents a reasonable accommodation of conflicting policies that were committed to the agency's care by the statute, we should not disturb it unless it appears from the statute or its legislative history that the accommodation is not one that Congress would have sanctioned." United States v. Shimer, 367 U.S. 374, 382, 383 (1961).
Accord, Capital Cities Cable, Inc. v. Crisp, ante, at 699-700.
In light of these well-settled principles it is clear that the Court of Appeals misconceived the nature of its role in reviewing the regulations at issue. Once it determined, after its own examination of the legislation, that Congress did not actually have an intent regarding the applicability of the bubble concept to the permit program, the question before it was not whether in its view the concept is "inappropriate" in the general context of a program designed to improve air quality, but whether the Administrator's view that it is appropriate in the context of this particular program is a reasonable one. Based on the examination of the legislation and its history which follows, we agree with the Court of Appeals that Congress did not have a specific intention on the applicability of the bubble concept in these cases, and conclude that the EPA's use of that concept here is a reasonable policy choice for the agency to make.
III
In the 1950's and the 1960's Congress enacted a series of statutes designed to encourage and to assist the States in curtailing air pollution. See generally Train v. Natural Resources Defense Council, Inc., 421 U.S. 60, 63-64 (1975). The Clean Air Amendments of 1970, Pub. L. 91-604, 84 Stat. 1976, "sharply increased federal authority and responsibility *846 in the continuing effort to combat air pollution," 421 U.S., at 64, but continued to assign "primary responsibility for assuring air quality" to the several States, 84 Stat. 1678. Section 109 of the 1970 Amendments directed the EPA to promulgate National Ambient Air Quality Standards (NAAQS's)[15] and § 110 directed the States to develop plans (SIP's) to implement the standards within specified deadlines. In addition, § 111 provided that major new sources of pollution would be required to conform to technology-based performance standards; the EPA was directed to publish a list of categories of sources of pollution and to establish new source performance standards (NSPS) for each. Section 111(e) prohibited the operation of any new source in violation of a performance standard.
Section 111(a) defined the terms that are to be used in setting and enforcing standards of performance for new stationary sources. It provided:
"For purposes of this section:
.....
"(3) The term `stationary source' means any building, structure, facility, or installation which emits or may emit any air pollutant." 84 Stat. 1683.
In the 1970 Amendments that definition was not only applicable to the NSPS program required by § 111, but also was made applicable to a requirement of § 110 that each state implementation plan contain a procedure for reviewing the location of any proposed new source and preventing its construction if it would preclude the attainment or maintenance of national air quality standards.[16]
In due course, the EPA promulgated NAAQS's, approved SIP's, and adopted detailed regulations governing NSPS's *847 for various categories of equipment. In one of its programs, the EPA used a plantwide definition of the term "stationary source." In 1974, it issued NSPS's for the nonferrous smelting industry that provided that the standards would not apply to the modification of major smelting units if their increased emissions were offset by reductions in other portions of the same plant.[17]
Nonattainment
The 1970 legislation provided for the attainment of primary NAAQS's by 1975. In many areas of the country, particularly the most industrialized States, the statutory goals were not attained.[18] In 1976, the 94th Congress was confronted with this fundamental problem, as well as many others respecting pollution control. As always in this area, the legislative struggle was basically between interests seeking strict schemes to reduce pollution rapidly to eliminate its social costs and interests advancing the economic concern that strict schemes would retard industrial development with attendant social costs. The 94th Congress, confronting these competing interests, was unable to agree on what response was in the public interest: legislative proposals to deal with nonattainment failed to command the necessary consensus.[19]
In light of this situation, the EPA published an Emissions Offset Interpretive Ruling in December 1976, see 41 Fed. Reg. 55524, to "fill the gap," as respondents put it, until Congress acted. The Ruling stated that it was intended to *848 address "the issue of whether and to what extent national air quality standards established under the Clean Air Act may restrict or prohibit growth of major new or expanded stationary air pollution sources." Id., at 55524-55525. In general, the Ruling provided that "a major new source may locate in an area with air quality worse than a national standard only if stringent conditions can be met." Id., at 55525. The Ruling gave primary emphasis to the rapid attainment of the statute's environmental goals.[20] Consistent with that emphasis, the construction of every new source in nonattainment areas had to meet the "lowest achievable emission rate" under the current state of the art for that type of facility. See Ibid. The 1976 Ruling did not, however, explicitly adopt or reject the "bubble concept."[21]
IV
The Clean Air Act Amendments of 1977 are a lengthy, detailed, technical, complex, and comprehensive response to a major social issue. A small portion of the statute 91 Stat. *849 745-751 (Part D of Title I of the amended Act, 42 U.S. C. §§ 7501-7508) expressly deals with nonattainment areas. The focal point of this controversy is one phrase in that portion of the Amendments.[22]
Basically, the statute required each State in a nonattainment area to prepare and obtain approval of a new SIP by July 1, 1979. In the interim those States were required to comply with the EPA's interpretative Ruling of December 21, 1976. 91 Stat. 745. The deadline for attainment of the primary NAAQS's was extended until December 31, 1982, and in some cases until December 31, 1987, but the SIP's were required to contain a number of provisions designed to achieve the goals as expeditiously as possible.[23]
*850 Most significantly for our purposes, the statute provided that each plan shall
"(6) require permits for the construction and operation of new or modified major stationary sources in accordance with section 173 . . . ." Id., at 747.
Before issuing a permit, § 173 requires (1) the state agency to determine that there will be sufficient emissions reductions in the region to offset the emissions from the new source and also to allow for reasonable further progress toward attainment, or that the increased emissions will not exceed an allowance for growth established pursuant to § 172(b)(5); (2) the applicant to certify that his other sources in the State are in compliance with the SIP, (3) the agency to determine that the applicable SIP is otherwise being implemented, and (4) the proposed source to comply with the lowest achievable emission rate (LAER).[24]
*851 The 1977 Amendments contain no specific reference to the "bubble concept." Nor do they contain a specific definition of the term "stationary source," though they did not disturb the definition of "stationary source" contained in § 111(a)(3), applicable by the terms of the Act to the NSPS program. Section 302(j), however, defines the term "major stationary source" as follows:
"(j) Except as otherwise expressly provided, the terms `major stationary source' and `major emitting facility' mean any stationary facility or source of air pollutants which directly emits, or has the potential to emit, one hundred tons per year or more of any air pollutant (including any major emitting facility or source of fugitive emissions of any such pollutant, as determined by rule by the Administrator)." 91 Stat. 770.
V
The legislative history of the portion of the 1977 Amendments dealing with nonattainment areas does not contain any specific comment on the "bubble concept" or the question whether a plantwide definition of a stationary source is permissible under the permit program. It does, however, plainly disclose that in the permit program Congress sought to accommodate the conflict between the economic interest in permitting capital improvements to continue and the environmental interest in improving air quality. Indeed, the House Committee Report identified the economic interest as one of the "two main purposes" of this section of the bill. It stated:
"Section 117 of the bill, adopted during full committee markup establishes a new section 127 of the Clean Air Act. The section has two main purposes: (1) to allow reasonable economic growth to continue in an area while making reasonable further progress to assure attainment of the standards by a fixed date; and (2) to allow *852 States greater flexibility for the former purpose than EPA's present interpretative regulations afford.
"The new provision allows States with nonattainment areas to pursue one of two options. First, the State may proceed under EPA's present `tradeoff' or `offset' ruling. The Administrator is authorized, moreover, to modify or amend that ruling in accordance with the intent and purposes of this section.
"The State's second option would be to revise its implementation plan in accordance with this new provision." H. R. Rep. No. 95-294, p. 211 (1977).[25]
The portion of the Senate Committee Report dealing with nonattainment areas states generally that it was intended to "supersede the EPA administrative approach," and that expansion should be permitted if a State could "demonstrate that these facilities can be accommodated within its overall plan to provide for attainment of air quality standards." S. Rep. No. 95-127, p. 55 (1977). The Senate Report notes the value of "case-by-case review of each new or modified major source of pollution that seeks to locate in a region exceeding an ambient standard," explaining that such a review "requires matching reductions from existing sources against *853 emissions expected from the new source in order to assure that introduction of the new source will not prevent attainment of the applicable standard by the statutory deadline." Ibid. This description of a case-by-case approach to plant additions, which emphasizes the net consequences of the construction or modification of a new source, as well as its impact on the overall achievement of the national standards, was not, however, addressed to the precise issue raised by these cases.
Senator Muskie made the following remarks:
"I should note that the test for determining whether a new or modified source is subject to the EPA interpretative regulation [the Offset Ruling] and to the permit requirements of the revised implementation plans under the conference bill is whether the source will emit a pollutant into an area which is exceeding a national ambient air quality standard for that pollutant or precursor. Thus, a new source is still subject to such requirements as `lowest achievable emission rate' even if it is constructed as a replacement for an older facility resulting in a net reduction from previous emission levels.
"A source including an existing facility ordered to convert to coal is subject to all the nonattainment requirements as a modified source if it makes any physical change which increases the amount of any air pollutant for which the standards in the area are exceeded." 123 Cong. Rec. 26847 (1977).
VI
As previously noted, prior to the 1977 Amendments, the EPA had adhered to a plantwide definition of the term "source" under a NSPS program. After adoption of the 1977 Amendments, proposals for a plantwide definition were considered in at least three formal proceedings.
In January 1979, the EPA considered the question whether the same restriction on new construction in nonattainment areas that had been included in its December 1976 Ruling *854 should be required in the revised SIP's that were scheduled to go into effect in July 1979. After noting that the 1976 Ruling was ambiguous on the question "whether a plant with a number of different processes and emission points would be considered a single source," 44 Fed. Reg. 3276 (1979), the EPA, in effect, provided a bifurcated answer to that question. In those areas that did not have a revised SIP in effect by July 1979, the EPA rejected the plantwide definition; on the other hand, it expressly concluded that the plantwide approach would be permissible in certain circumstances if authorized by an approved SIP. It stated:
"Where a state implementation plan is revised and implemented to satisfy the requirements of Part D, including the reasonable further progress requirement, the plan requirements for major modifications may exempt modifications of existing facilities that are accompanied by intrasource offsets so that there is no net increase in emissions. The agency endorses such exemptions, which would provide greater flexibility to sources to effectively manage their air emissions at least cost." Ibid.[26]
*855 In April, and again in September 1979, the EPA published additional comments in which it indicated that revised SIP's could adopt the plantwide definition of source in nonattainment areas in certain circumstances. See id., at 20372, 20379, 51924, 51951, 51958. On the latter occasion, the EPA made a formal rulemaking proposal that would have permitted the use of the "bubble concept" for new installations within a plant as well as for modifications of existing units. It explained:
" `Bubble' Exemption: The use of offsets inside the same source is called the `bubble.' EPA proposes use of the definition of `source' (see above) to limit the use of the bubble under nonattainment requirements in the following respects:
"i. Part D SIPs that include all requirements needed to assure reasonable further progress and attainment by the deadline under section 172 and that are being carried out need not restrict the use of a plantwide bubble, the same as under the PSD proposal.
"ii. Part D SIPs that do not meet the requirements specified must limit use of the bubble by including a definition of `installation' as an identifiable piece of process equipment."[27]
*856 Significantly, the EPA expressly noted that the word "source" might be given a plantwide definition for some purposes and a narrower definition for other purposes. It wrote:
"Source means any building structure, facility, or installation which emits or may emit any regulated pollutant. `Building, structure, facility or installation' means plant in PSD areas and in nonattainment areas except where the growth prohibitions would apply or where no adequate SIP exists or is being carried out." Id., at 51925.[28]
The EPA's summary of its proposed Ruling discloses a flexible rather than rigid definition of the term "source" to implement various policies and programs:
"In summary, EPA is proposing two different ways to define source for different kinds of NSR programs:
"(1) For PSD and complete Part D SIPs, review would apply only to plants, with an unrestricted plant-wide bubble.
"(2) For the offset ruling, restrictions on construction, and incomplete Part D SIPs, review would apply to both plants and individual pieces of process equipment, causing the plant-wide bubble not to apply for new and modified major pieces of equipment.
"In addition, for the restrictions on construction, EPA is proposing to define `major modification' so as to prohibit the bubble entirely. Finally, an alternative discussed but not favored is to have only pieces of process equipment reviewed, resulting in no plant-wide bubble and allowing minor pieces of equipment to escape NSR *857 regardless of whether they are within a major plant." Id., at 51934.
In August 1980, however, the EPA adopted a regulation that, in essence, applied the basic reasoning of the Court of Appeals in these cases. The EPA took particular note of the two then-recent Court of Appeals decisions, which had created the bright-line rule that the "bubble concept" should be employed in a program designed to maintain air quality but not in one designed to enhance air quality. Relying heavily on those cases,[29] EPA adopted a dual definition of "source" for nonattainment areas that required a permit whenever a change in either the entire plant, or one of its components, would result in a significant increase in emissions even if the increase was completely offset by reductions elsewhere in the plant. The EPA expressed the opinion that this interpretation was "more consistent with congressional intent" than the plantwide definition because it "would bring in more sources or modifications for review," 45 Fed. Reg. 52697 (1980), but its primary legal analysis was predicated on the two Court of Appeals decisions.
In 1981 a new administration took office and initiated a "Government-wide reexamination of regulatory burdens and complexities." 46 Fed. Reg. 16281. In the context of that *858 review, the EPA reevaluated the various arguments that had been advanced in connection with the proper definition of the term "source" and concluded that the term should be given the same definition in both nonattainment areas and PSD areas.
In explaining its conclusion, the EPA first noted that the definitional issue was not squarely addressed in either the statute or its legislative history and therefore that the issue involved an agency "judgment as how to best carry out the Act." Ibid. It then set forth several reasons for concluding that the plantwide definition was more appropriate. It pointed out that the dual definition "can act as a disincentive to new investment and modernization by discouraging modifications to existing facilities" and "can actually retard progress in air pollution control by discouraging replacement of older, dirtier processes or pieces of equipment with new, cleaner ones." Ibid. Moreover, the new definition "would simplify EPA's rules by using the same definition of `source' for PSD, nonattainment new source review and the construction moratorium. This reduces confusion and inconsistency." Ibid. Finally, the agency explained that additional requirements that remained in place would accomplish the fundamental purposes of achieving attainment with NAAQS's as expeditiously as possible.[30] These conclusions were expressed *859 in a proposed rulemaking in August 1981 that was formally promulgated in October. See id., at 50766.
VII
In this Court respondents expressly reject the basic rationable of the Court of Appeals' decision. That court viewed the statutory definition of the term "source" as sufficiently flexible to cover either a plantwide definition, a narrower definition covering each unit within a plant, or a dual definition that could apply to both the entire "bubble" and its components. It interpreted the policies of the statute, however, to mandate the plantwide definition in programs designed to maintain clean air and to forbid it in programs designed to improve air quality. Respondents place a fundamentally different construction on the statute. They contend that the text of the Act requires the EPA to use a dual definition if either a component of a plant, or the plant as a whole, emits over 100 tons of pollutant, it is a major stationary source. They thus contend that the EPA rules adopted in 1980, insofar as they apply to the maintenance of the quality of clean air, as well as the 1981 rules which apply to nonattainment areas, violate the statute.[31]
Statutory Language
The definition of the term "stationary source" in § 111(a)(3) refers to "any building, structure, facility, or installation" which emits air pollution. See supra, at 846. This definition is applicable only to the NSPS program by the express terms of the statute; the text of the statute does not make this definition *860 applicable to the permit program. Petitioners therefore maintain that there is no statutory language even relevant to ascertaining the meaning of stationary source in the permit program aside from § 302(j), which defines the term "major stationary source." See supra, at 851. We disagree with petitioners on this point.
The definition in § 302(j) tells us what the word "major" means a source must emit at least 100 tons of pollution to qualify but it sheds virtually no light on the meaning of the term "stationary source." It does equate a source with a facility a "major emitting facility" and a "major stationary source" are synonymous under § 302(j). The ordinary meaning of the term "facility" is some collection of integrated elements which has been designed and constructed to achieve some purpose. Moreover, it is certainly no affront to common English usage to take a reference to a major facility or a major source to connote an entire plant as opposed to its constituent parts. Basically, however, the language of § 302(j) simply does not compel any given interpretation of the term "source."
Respondents recognize that, and hence point to § 111(a)(3). Although the definition in that section is not literally applicable to the permit program, it sheds as much light on the meaning of the word "source" as anything in the statute.[32] As respondents point out, use of the words "building, structure, facility, or installation," as the definition of source, could be read to impose the permit conditions on an individual building that is a part of a plant.[33] A "word may have a character of its own not to be submerged by its association." Russell Motor Car Co. v. United States, 261 U.S. 514, 519 *861 (1923). On the other hand, the meaning of a word must be ascertained in the context of achieving particular objectives, and the words associated with it may indicate that the true meaning of the series is to convey a common idea. The language may reasonably be interpreted to impose the requirement on any discrete, but integrated, operation which pollutes. This gives meaning to all of the terms a single building, not part of a larger operation, would be covered if it emits more than 100 tons of pollution, as would any facility, structure, or installation. Indeed, the language itself implies a "bubble concept" of sorts: each enumerated item would seem to be treated as if it were encased in a bubble. While respondents insist that each of these terms must be given a discrete meaning, they also argue that § 111(a)(3) defines "source" as that term is used in § 302(j). The latter section, however, equates a source with a facility, whereas the former defines "source" as a facility, among other items.
We are not persuaded that parsing of general terms in the text of the statute will reveal an actual intent of Congress.[34]*862 We know full well that this language is not dispositive; the terms are overlapping and the language is not precisely directed to the question of the applicability of a given term in the context of a larger operation. To the extent any congressional "intent" can be discerned from this language, it would appear that the listing of overlapping, illustrative terms was intended to enlarge, rather than to confine, the scope of the agency's power to regulate particular sources in order to effectuate the policies of the Act.
Legislative History
In addition, respondents argue that the legislative history and policies of the Act foreclose the plantwide definition, and that the EPA's interpretation is not entitled to deference because it represents a sharp break with prior interpretations of the Act.
Based on our examination of the legislative history, we agree with the Court of Appeals that it is unilluminating. The general remarks pointed to by respondents "were obviously not made with this narrow issue in mind and they cannot be said to demonstrate a Congressional desire . . . ." Jewell Ridge Coal Corp. v. Mine Workers, 325 U.S. 161, 168-169 (1945). Respondents' argument based on the legislative history relies heavily on Senator Muskie's observation that a new source is subject to the LAER requirement.[35] But the full statement is ambiguous and like the text of § 173 itself, this comment does not tell us what a new source is, much less that it is to have an inflexible definition. We find that the legislative history as a whole is silent on the precise issue before us. It is, however, consistent with the view that the EPA should have broad discretion in implementing the policies of the 1977 Amendments.
*863 More importantly, that history plainly identifies the policy concerns that motivated the enactment; the plantwide definition is fully consistent with one of those concerns the allowance of reasonable economic growth and, whether or not we believe it most effectively implements the other, we must recognize that the EPA has advanced a reasonable explanation for its conclusion that the regulations serve the environmental objectives as well. See supra, at 857-859, and n. 29; see also supra, at 855, n. 27. Indeed, its reasoning is supported by the public record developed in the rulemaking process,[36] as well as by certain private studies.[37]
Our review of the EPA's varying interpretations of the word "source" both before and after the 1977 Amendments convinces us that the agency primarily responsible for administering this important legislation has consistently interpreted it flexibly not in a sterile textual vacuum, but in the context of implementing policy decisions in a technical and complex arena. The fact that the agency has from time to time changed its interpretation of the term "source" does not, as respondents argue, lead us to conclude that no deference should be accorded the agency's interpretation of the statute. An initial agency interpretation is not instantly carved in stone. On the contrary, the agency, to engage in informed rulemaking, must consider varying interpretations *864 and the wisdom of its policy on a continuing basis. Moreover, the fact that the agency has adopted different definitions in different contexts adds force to the argument that the definition itself is flexible, particularly since Congress has never indicated any disapproval of a flexible reading of the statute.
Significantly, it was not the agency in 1980, but rather the Court of Appeals that read the statute inflexibly to command a plantwide definition for programs designed to maintain clean air and to forbid such a definition for programs designed to improve air quality. The distinction the court drew may well be a sensible one, but our labored review of the problem has surely disclosed that it is not a distinction that Congress ever articulated itself, or one that the EPA found in the statute before the courts began to review the legislative work product. We conclude that it was the Court of Appeals, rather than Congress or any of the decisionmakers who are authorized by Congress to administer this legislation, that was primarily responsible for the 1980 position taken by the agency.
Policy
The arguments over policy that are advanced in the parties' briefs create the impression that respondents are now waging in a judicial forum a specific policy battle which they ultimately lost in the agency and in the 32 jurisdictions opting for the "bubble concept," but one which was never waged in the Congress. Such policy arguments are more properly addressed to legislators or administrators, not to judges.[38]
*865 In these cases the Administrator's interpretation represents a reasonable accommodation of manifestly competing interests and is entitled to deference: the regulatory scheme is technical and complex,[39] the agency considered the matter in a detailed and reasoned fashion,[40] and the decision involves reconciling conflicting policies.[41] Congress intended to accommodate both interests, but did not do so itself on the level of specificity presented by these cases. Perhaps that body consciously desired the Administrator to strike the balance at this level, thinking that those with great expertise and charged with responsibility for administering the provision would be in a better position to do so; perhaps it simply did not consider the question at this level; and perhaps Congress was unable to forge a coalition on either side of the question, and those on each side decided to take their chances with the scheme devised by the agency. For judicial purposes, it matters not which of these things occurred.
Judges are not experts in the field, and are not part of either political branch of the Government. Courts must, in some cases, reconcile competing political interests, but not on the basis of the judges' personal policy preferences. In contrast, an agency to which Congress has delegated policymaking responsibilities may, within the limits of that delegation, properly rely upon the incumbent administration's views of wise policy to inform its judgments. While agencies are not directly accountable to the people, the Chief Executive is, and it is entirely appropriate for this political branch of the Government to make such policy choices resolving the competing interests which Congress itself either inadvertently did not resolve, or intentionally left to be resolved by the *866 agency charged with the administration of the statute in light of everyday realities.
When a challenge to an agency construction of a statutory provision, fairly conceptualized, really centers on the wisdom of the agency's policy, rather than whether it is a reasonable choice within a gap left open by Congress, the challenge must fail. In such a case, federal judges who have no constituency have a duty to respect legitimate policy choices made by those who do. The responsibilities for assessing the wisdom of such policy choices and resolving the struggle between competing views of the public interest are not judicial ones: "Our Constitution vests such responsibilities in the political branches." TVA v. Hill, 437 U.S. 153, 195 (1978).
We hold that the EPA's definition of the term "source" is a permissible construction of the statute which seeks to accommodate progress in reducing air pollution with economic growth. "The Regulations which the Administrator has adopted provide what the agency could allowably view as . . . [an] effective reconciliation of these twofold ends . . . ." United States v. Shimer, 367 U. S., at 383.
The judgment of the Court of Appeals is reversed.
It is so ordered.
JUSTICE MARSHALL and JUSTICE REHNQUIST took no part in the consideration or decision of these cases.
JUSTICE O'CONNOR took no part in the decision of these cases.
| In the Clean Air Act Amendments of 1977, Stat. 685, Congress enacted certain requirements applicable *840 to States that had not achieved the national air quality standards established by the Environmental Protection Agency (EPA) pursuant to earlier legislation. The amended Clean Air Act required these "nonattainment" States to establish a permit program regulating "new or modified major stationary sources" of air pollution. Generally, a permit may not be issued for a new or modified major stationary source unless several stringent conditions are met.[1] The EPA regulation promulgated to implement this permit requirement allows a State to adopt a plantwide definition of the term "stationary source."[2] Under this definition, an existing plant that contains several pollution-emitting devices may install or modify one piece of equipment without meeting the permit conditions if the alteration will not increase the total emissions from the plant. The question presented by these cases is whether EPA's decision to allow States to treat all of the pollution-emitting devices within the same industrial grouping as though they were encased within a single "bubble" is based on a reasonable construction of the statutory term "stationary source." I The EPA regulations containing the plantwide definition of the term stationary source were promulgated on October *841 14, 1981. Respondents[3] filed a timely petition for review in the United States Court of Appeals for the District of Columbia Circuit pursuant to 42 U.S. C. 7607(b)(1).[4] The Court of Appeals set aside the regulations. National Resources Defense Council, The court observed that the relevant part of the amended Clean Air Act "does not explicitly define what Congress envisioned as a `stationary source, to which the permit program. should apply," and further stated that the precise issue was not "squarely addressed in the legislative history." In light of its conclusion that the legislative history bearing on the question was "at best contradictory," it reasoned that "the purposes of the nonattainment program should guide our decision here." n.[5] Based on two of its precedents concerning the applicability of the bubble concept to certain Clean Air Act programs,[6] the court stated that the bubble concept was "mandatory" in programs designed merely to maintain existing air quality, but held that it was "inappropriate" in programs enacted to improve air quality. Since the purpose of the permit *842 program its "raison d'etre," in the court's view was to improve air quality, the court held that the bubble concept was inapplicable in these cases under its prior precedents. It therefore set aside the regulations embodying the bubble concept as contrary to law. We granted certiorari to review that judgment, and we now reverse. The basic legal error of the Court of Appeals was to adopt a static judicial definition of the term "stationary source" when it had decided that Congress itself had not commanded that definition. Respondents do not defend the legal reasoning of the Court of Appeals.[7] Nevertheless, since this Court reviews judgments, not opinions,[8] we must determine whether the Court of Appeals' legal error resulted in an erroneous judgment on the validity of the regulations. II When a court reviews an agency's construction of the statute which it administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, *843 as well as the agency, must give effect to the unambiguously expressed intent of Congress.[9] If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute,[10] as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute.[11] "The power of an administrative agency to administer a congressionally created program necessarily requires the formulation of policy and the making of rules to fill any gap left, implicitly or explicitly, by Congress." If Congress has explicitly left a gap for the agency to fill, there is an express delegation *844 of authority to the agency to elucidate a specific provision of the statute by regulation. Such legislative regulations are given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute.[12] Sometimes the legislative delegation to an agency on a particular question is implicit rather than explicit. In such a case, a court may not substitute its own construction of a statutory provision for a reasonable interpretation made by the administrator of an agency.[13] We have long recognized that considerable weight should be accorded to an executive department's construction of a statutory scheme it is entrusted to administer,[14] and the principle of deference to administrative interpretations "has been consistently followed by this Court whenever decision as to the meaning or reach of a statute has involved reconciling conflicting policies, and a full understanding of the force of the statutory policy in the given situation has depended upon more than ordinary knowledge respecting the matters subjected to agency regulations. See, e. g., National Broadcasting ; Labor ; Republic Aviation ; Securities & Exchange ; Labor ". If this choice represents a reasonable accommodation of conflicting policies that were committed to the agency's care by the statute, we should not disturb it unless it appears from the statute or its legislative history that the accommodation is not one that Congress would have sanctioned." United Accord, Capital Cities Cable, Inc. v. Crisp, ante, at 699-700. In light of these well-settled principles it is clear that the Court of Appeals misconceived the nature of its role in reviewing the regulations at issue. Once it determined, after its own examination of the legislation, that Congress did not actually have an intent regarding the applicability of the bubble concept to the permit program, the question before it was not whether in its view the concept is "inappropriate" in the general context of a program designed to improve air quality, but whether the Administrator's view that it is appropriate in the context of this particular program is a reasonable one. Based on the examination of the legislation and its history which follows, we agree with the Court of Appeals that Congress did not have a specific intention on the applicability of the bubble concept in these cases, and conclude that the EPA's use of that concept here is a reasonable policy choice for the agency to make. III In the 0's and the 1960's Congress enacted a series of statutes designed to encourage and to assist the States in curtailing air pollution. See generally The Clean Air Amendments of 1970, Stat. 1976, "sharply increased federal authority and responsibility *846 in the continuing effort to combat air pollution," but continued to assign "primary responsibility for assuring air quality" to the several States, Section 109 of the 1970 Amendments directed the EPA to promulgate National Ambient Air Quality Standards (NAAQS's)[15] and 110 directed the States to develop plans (SIP's) to implement the standards within specified deadlines. In addition, 111 provided that major new sources of pollution would be required to conform to technology-based performance standards; the EPA was directed to publish a list of categories of sources of pollution and to establish new source performance standards (NSPS) for each. Section 111(e) prohibited the operation of any new source in violation of a performance standard. Section 111(a) defined the terms that are to be used in setting and enforcing standards of performance for new stationary sources. It provided: "For purposes of this section: "(3) The term `stationary source' means any building, structure, facility, or installation which emits or may emit any air pollutant." In the 1970 Amendments that definition was not only applicable to the NSPS program required by 111, but was made applicable to a requirement of 110 that each state implementation plan contain a procedure for reviewing the location of any proposed new source and preventing its construction if it would preclude the attainment or maintenance of national air quality standards.[16] In due course, the EPA promulgated NAAQS's, approved SIP's, and adopted detailed regulations governing NSPS's *847 for various categories of equipment. In one of its programs, the EPA used a plantwide definition of the term "stationary source." In 1974, it issued NSPS's for the nonferrous smelting industry that provided that the standards would not apply to the modification of major smelting units if their increased emissions were offset by reductions in other portions of the same plant.[17] Nonattainment The 1970 legislation provided for the attainment of primary NAAQS's by 1975. In many areas of the country, particularly the most industrialized States, the statutory goals were not attained.[18] In 1976, the 94th Congress was confronted with this fundamental problem, as well as many others respecting pollution control. As always in this area, the legislative struggle was basically between interests seeking strict schemes to reduce pollution rapidly to eliminate its social costs and interests advancing the economic concern that strict schemes would retard industrial development with attendant social costs. The 94th Congress, confronting these competing interests, was unable to agree on what response was in the public interest: legislative proposals to deal with nonattainment failed to command the necessary consensus.[19] In light of this situation, the EPA published an Emissions Offset Interpretive Ruling in December 1976, see to "fill the gap," as respondents put it, until Congress acted. The Ruling stated that it was intended to *848 address "the issue of whether and to what extent national air quality standards established under the Clean Air Act may restrict or prohibit growth of major new or expanded stationary air pollution sources." In general, the Ruling provided that "a major new source may locate in an area with air quality worse than a national standard only if stringent conditions can be met." The Ruling gave primary emphasis to the rapid attainment of the statute's environmental goals.[20] Consistent with that emphasis, the construction of every new source in nonattainment areas had to meet the "lowest achievable emission rate" under the current state of the art for that type of facility. See The 1976 Ruling did not, however, explicitly adopt or reject the "bubble concept."[21] IV The Clean Air Act Amendments of 1977 are a lengthy, detailed, technical, complex, and comprehensive response to a major social issue. A small portion of the statute 91 Stat. *849 745-751 (Part D of Title I of the amended Act, 42 U.S. C. 7501-7508) expressly deals with nonattainment areas. The focal point of this controversy is one phrase in that portion of the Amendments.[22] Basically, the statute required each State in a nonattainment area to prepare and obtain approval of a new SIP by July 1, 1979. In the interim those States were required to comply with the EPA's interpretative Ruling of December 21, 1976. The deadline for attainment of the primary NAAQS's was extended until December 31, and in some cases until December 31, 1987, but the SIP's were required to contain a number of provisions designed to achieve the goals as expeditiously as possible.[23] *850 Most significantly for our purposes, the statute provided that each plan shall "(6) require permits for the construction and operation of new or modified major stationary sources in accordance with section 173" Before issuing a permit, 173 requires (1) the state agency to determine that there will be sufficient emissions reductions in the region to offset the emissions from the new source and to allow for reasonable further progress toward attainment, or that the increased emissions will not exceed an allowance for growth established pursuant to 172(b)(5); (2) the applicant to certify that his other sources in the State are in compliance with the SIP, (3) the agency to determine that the applicable SIP is otherwise being implemented, and (4) the proposed source to comply with the lowest achievable emission rate (LAER).[24] *851 The 1977 Amendments contain no specific reference to the "bubble concept." Nor do they contain a specific definition of the term "stationary source," though they did not disturb the definition of "stationary source" contained in 111(a)(3), applicable by the terms of the Act to the NSPS program. Section 302(j), however, defines the term "major stationary source" as follows: "(j) Except as otherwise expressly provided, the terms `major stationary source' and `major emitting facility' mean any stationary facility or source of air pollutants which directly emits, or has the potential to emit, one hundred tons per year or more of any air pollutant (including any major emitting facility or source of fugitive emissions of any such pollutant, as determined by rule by the Administrator)." V The legislative history of the portion of the 1977 Amendments dealing with nonattainment areas does not contain any specific comment on the "bubble concept" or the question whether a plantwide definition of a stationary source is permissible under the permit program. It does, however, plainly disclose that in the permit program Congress sought to accommodate the conflict between the economic interest in permitting capital improvements to continue and the environmental interest in improving air quality. Indeed, the House Committee Report identified the economic interest as one of the "two main purposes" of this section of the bill. It stated: "Section 117 of the bill, adopted during full committee markup establishes a new section 127 of the Clean Air Act. The section has two main purposes: (1) to allow reasonable economic growth to continue in an area while making reasonable further progress to assure attainment of the standards by a fixed date; and (2) to allow *852 States greater flexibility for the former purpose than EPA's present interpretative regulations afford. "The new provision allows States with nonattainment areas to pursue one of two options. First, the State may proceed under EPA's present `tradeoff' or `offset' ruling. The Administrator is authorized, moreover, to modify or amend that ruling in accordance with the intent and purposes of this section. "The State's second option would be to revise its implementation plan in accordance with this new provision." H. R. Rep. No. 95-294, p. 211 (1977).[25] The portion of the Senate Committee Report dealing with nonattainment areas states generally that it was intended to "supersede the EPA administrative approach," and that expansion should be permitted if a State could "demonstrate that these facilities can be accommodated within its overall plan to provide for attainment of air quality standards." S. Rep. No. 95-127, p. 55 (1977). The Senate Report notes the value of "case-by-case review of each new or modified major source of pollution that seeks to locate in a region exceeding an ambient standard," explaining that such a review "requires matching reductions from existing sources against *853 emissions expected from the new source in order to assure that introduction of the new source will not prevent attainment of the applicable standard by the statutory deadline." This description of a case-by-case approach to plant additions, which emphasizes the net consequences of the construction or modification of a new source, as well as its impact on the overall achievement of the national standards, was not, however, addressed to the precise issue raised by these cases. Senator Muskie made the following remarks: "I should note that the test for determining whether a new or modified source is subject to the EPA interpretative regulation [the Offset Ruling] and to the permit requirements of the revised implementation plans under the conference bill is whether the source will emit a pollutant into an area which is exceeding a national ambient air quality standard for that pollutant or precursor. Thus, a new source is still subject to such requirements as `lowest achievable emission rate' even if it is constructed as a replacement for an older facility resulting in a net reduction from previous emission levels. "A source including an existing facility ordered to convert to coal is subject to all the nonattainment requirements as a modified source if it makes any physical change which increases the amount of any air pollutant for which the standards in the area are exceeded." 123 Cong. Rec. 26847 (1977). VI As previously noted, prior to the 1977 Amendments, the EPA had adhered to a plantwide definition of the term "source" under a NSPS program. After adoption of the 1977 Amendments, proposals for a plantwide definition were considered in at least three formal proceedings. In January 1979, the EPA considered the question whether the same restriction on new construction in nonattainment areas that had been included in its December 1976 Ruling *854 should be required in the revised SIP's that were scheduled to go into effect in July 1979. After noting that the 1976 Ruling was ambiguous on the question "whether a plant with a number of different processes and emission points would be considered a single source," 44 Fed. Reg. 3 (1979), the EPA, in effect, provided a bifurcated answer to that question. In those areas that did not have a revised SIP in effect by July 1979, the EPA rejected the plantwide definition; on the other hand, it expressly concluded that the plantwide approach would be permissible in certain circumstances if authorized by an approved SIP. It stated: "Where a state implementation plan is revised and implemented to satisfy the requirements of Part D, including the reasonable further progress requirement, the plan requirements for major modifications may exempt modifications of existing facilities that are accompanied by intrasource offsets so that there is no net increase in emissions. The agency endorses such exemptions, which would provide greater flexibility to sources to effectively manage their air emissions at least cost." [26] *855 In April, and again in September 1979, the EPA published additional comments in which it indicated that revised SIP's could adopt the plantwide definition of source in nonattainment areas in certain circumstances. See On the latter occasion, the EPA made a formal rulemaking proposal that would have permitted the use of the "bubble concept" for new installations within a plant as well as for modifications of existing units. It explained: " `Bubble' Exemption: The use of offsets inside the same source is called the `bubble.' EPA proposes use of the definition of `source' (see above) to limit the use of the bubble under nonattainment requirements in the following respects: "i. Part D SIPs that include all requirements needed to assure reasonable further progress and attainment by the deadline under section 172 and that are being carried out need not restrict the use of a plantwide bubble, the same as under the PSD proposal. "ii. Part D SIPs that do not meet the requirements specified must limit use of the bubble by including a definition of `installation' as an identifiable piece of process equipment."[27] *856 Significantly, the EPA expressly noted that the word "source" might be given a plantwide definition for some purposes and a narrower definition for other purposes. It wrote: "Source means any building structure, facility, or installation which emits or may emit any regulated pollutant. `Building, structure, facility or installation' means plant in PSD areas and in nonattainment areas except where the growth prohibitions would apply or where no adequate SIP exists or is being carried out."[28] The EPA's summary of its proposed Ruling discloses a flexible rather than rigid definition of the term "source" to implement various policies and programs: "In summary, EPA is proposing two different ways to define source for different kinds of NSR programs: "(1) For PSD and complete Part D SIPs, review would apply only to plants, with an unrestricted plant-wide bubble. "(2) For the offset ruling, restrictions on construction, and incomplete Part D SIPs, review would apply to both plants and individual pieces of process equipment, causing the plant-wide bubble not to apply for new and modified major pieces of equipment. "In addition, for the restrictions on construction, EPA is proposing to define `major modification' so as to prohibit the bubble entirely. Finally, an alternative discussed but not favored is to have only pieces of process equipment reviewed, resulting in no plant-wide bubble and allowing minor pieces of equipment to escape NSR *857 regardless of whether they are within a major plant." In August 1980, however, the EPA adopted a regulation that, in essence, applied the basic reasoning of the Court of Appeals in these cases. The EPA took particular note of the two then-recent Court of Appeals decisions, which had created the bright-line rule that the "bubble concept" should be employed in a program designed to maintain air quality but not in one designed to enhance air quality. Relying heavily on those cases,[29] EPA adopted a dual definition of "source" for nonattainment areas that required a permit whenever a change in either the entire plant, or one of its components, would result in a significant increase in emissions even if the increase was completely offset by reductions elsewhere in the plant. The EPA expressed the opinion that this interpretation was "more consistent with congressional intent" than the plantwide definition because it "would bring in more sources or modifications for review," (1980), but its primary legal analysis was predicated on the two Court of Appeals decisions. In 1981 a new administration took office and initiated a "Government-wide reexamination of regulatory burdens and complexities." In the context of that *858 review, the EPA reevaluated the various arguments that had been advanced in connection with the proper definition of the term "source" and concluded that the term should be given the same definition in both nonattainment areas and PSD areas. In explaining its conclusion, the EPA first noted that the definitional issue was not squarely addressed in either the statute or its legislative history and therefore that the issue involved an agency "judgment as how to best carry out the Act." It then set forth several reasons for concluding that the plantwide definition was more appropriate. It pointed out that the dual definition "can act as a disincentive to new investment and modernization by discouraging modifications to existing facilities" and "can actually retard progress in air pollution control by discouraging replacement of older, dirtier processes or pieces of equipment with new, cleaner ones." Moreover, the new definition "would simplify EPA's rules by using the same definition of `source' for PSD, nonattainment new source review and the construction moratorium. This reduces confusion and inconsistency." Finally, the agency explained that additional requirements that remained in place would accomplish the fundamental purposes of achieving attainment with NAAQS's as expeditiously as possible.[30] These conclusions were expressed *859 in a proposed rulemaking in August 1981 that was formally promulgated in October. See VII In this Court respondents expressly reject the basic rationable of the Court of Appeals' decision. That court viewed the statutory definition of the term "source" as sufficiently flexible to cover either a plantwide definition, a narrower definition covering each unit within a plant, or a dual definition that could apply to both the entire "bubble" and its components. It interpreted the policies of the statute, however, to mandate the plantwide definition in programs designed to maintain clean air and to forbid it in programs designed to improve air quality. Respondents place a fundamentally different construction on the statute. They contend that the text of the Act requires the EPA to use a dual definition if either a component of a plant, or the plant as a whole, emits over 100 tons of pollutant, it is a major stationary source. They thus contend that the EPA rules adopted in 1980, insofar as they apply to the maintenance of the quality of clean air, as well as the 1981 rules which apply to nonattainment areas, violate the statute.[31] Statutory Language The definition of the term "stationary source" in 111(a)(3) refers to "any building, structure, facility, or installation" which emits air pollution. See This definition is applicable only to the NSPS program by the express terms of the statute; the text of the statute does not make this definition *860 applicable to the permit program. Petitioners therefore maintain that there is no statutory language even relevant to ascertaining the meaning of stationary source in the permit program aside from 302(j), which defines the term "major stationary source." See We disagree with petitioners on this point. The definition in 302(j) tells us what the word "major" means a source must emit at least 100 tons of pollution to qualify but it sheds virtually no light on the meaning of the term "stationary source." It does equate a source with a facility a "major emitting facility" and a "major stationary source" are synonymous under 302(j). The ordinary meaning of the term "facility" is some collection of integrated elements which has been designed and constructed to achieve some purpose. Moreover, it is certainly no affront to common English usage to take a reference to a major facility or a major source to connote an entire plant as opposed to its constituent parts. Basically, however, the language of 302(j) simply does not compel any given interpretation of the term "source." Respondents recognize that, and hence point to 111(a)(3). Although the definition in that section is not literally applicable to the permit program, it sheds as much light on the meaning of the word "source" as anything in the statute.[32] As respondents point out, use of the words "building, structure, facility, or installation," as the definition of source, could be read to impose the permit conditions on an individual building that is a part of a plant.[33] A "word may have a character of its own not to be submerged by its association." Russell Motor Car On the other hand, the meaning of a word must be ascertained in the context of achieving particular objectives, and the words associated with it may indicate that the true meaning of the series is to convey a common idea. The language may reasonably be interpreted to impose the requirement on any discrete, but integrated, operation which pollutes. This gives meaning to all of the terms a single building, not part of a larger operation, would be covered if it emits more than 100 tons of pollution, as would any facility, structure, or installation. Indeed, the language itself implies a "bubble concept" of sorts: each enumerated item would seem to be treated as if it were encased in a bubble. While respondents insist that each of these terms must be given a discrete meaning, they argue that 111(a)(3) defines "source" as that term is used in 302(j). The latter section, however, equates a source with a facility, whereas the former defines "source" as a facility, among other items. We are not persuaded that parsing of general terms in the text of the statute will reveal an actual intent of Congress.[34]*862 We know full well that this language is not dispositive; the terms are overlapping and the language is not precisely directed to the question of the applicability of a given term in the context of a larger operation. To the extent any congressional "intent" can be discerned from this language, it would appear that the listing of overlapping, illustrative terms was intended to enlarge, rather than to confine, the scope of the agency's power to regulate particular sources in order to effectuate the policies of the Act. Legislative History In addition, respondents argue that the legislative history and policies of the Act foreclose the plantwide definition, and that the EPA's interpretation is not entitled to deference because it represents a sharp break with prior interpretations of the Act. Based on our examination of the legislative history, we agree with the Court of Appeals that it is unilluminating. The general remarks pointed to by respondents "were obviously not made with this narrow issue in mind and they cannot be said to demonstrate a Congressional desire" Jewell Ridge Coal Respondents' argument based on the legislative history relies heavily on Senator Muskie's observation that a new source is subject to the LAER requirement.[35] But the full statement is ambiguous and like the text of 173 itself, this comment does not tell us what a new source is, much less that it is to have an inflexible definition. We find that the legislative history as a whole is silent on the precise issue before us. It is, however, consistent with the view that the EPA should have broad discretion in implementing the policies of the 1977 Amendments. *863 More importantly, that history plainly identifies the policy concerns that motivated the enactment; the plantwide definition is fully consistent with one of those concerns the allowance of reasonable economic growth and, whether or not we believe it most effectively implements the other, we must recognize that the EPA has advanced a reasonable explanation for its conclusion that the regulations serve the environmental objectives as well. See and n. 29; see Indeed, its reasoning is supported by the public record developed in the rulemaking process,[36] as well as by certain private studies.[37] Our review of the EPA's varying interpretations of the word "source" both before and after the 1977 Amendments convinces us that the agency primarily responsible for administering this important legislation has consistently interpreted it flexibly not in a sterile textual vacuum, but in the context of implementing policy decisions in a technical and complex arena. The fact that the agency has from time to time changed its interpretation of the term "source" does not, as respondents argue, lead us to conclude that no deference should be accorded the agency's interpretation of the statute. An initial agency interpretation is not instantly carved in stone. On the contrary, the agency, to engage in informed rulemaking, must consider varying interpretations *864 and the wisdom of its policy on a continuing basis. Moreover, the fact that the agency has adopted different definitions in different contexts adds force to the argument that the definition itself is flexible, particularly since Congress has never indicated any disapproval of a flexible reading of the statute. Significantly, it was not the agency in 1980, but rather the Court of Appeals that read the statute inflexibly to command a plantwide definition for programs designed to maintain clean air and to forbid such a definition for programs designed to improve air quality. The distinction the court drew may well be a sensible one, but our labored review of the problem has surely disclosed that it is not a distinction that Congress ever articulated itself, or one that the EPA found in the statute before the courts began to review the legislative work product. We conclude that it was the Court of Appeals, rather than Congress or any of the decisionmakers who are authorized by Congress to administer this legislation, that was primarily responsible for the 1980 position taken by the agency. Policy The arguments over policy that are advanced in the parties' briefs create the impression that respondents are now waging in a judicial forum a specific policy battle which they ultimately lost in the agency and in the 32 jurisdictions opting for the "bubble concept," but one which was never waged in the Congress. Such policy arguments are more properly addressed to legislators or administrators, not to judges.[38] *865 In these cases the Administrator's interpretation represents a reasonable accommodation of manifestly competing interests and is entitled to deference: the regulatory scheme is technical and complex,[] the agency considered the matter in a detailed and reasoned fashion,[40] and the decision involves reconciling conflicting policies.[41] Congress intended to accommodate both interests, but did not do so itself on the level of specificity presented by these cases. Perhaps that body consciously desired the Administrator to strike the balance at this level, thinking that those with great expertise and charged with responsibility for administering the provision would be in a better position to do so; perhaps it simply did not consider the question at this level; and perhaps Congress was unable to forge a coalition on either side of the question, and those on each side decided to take their chances with the scheme devised by the agency. For judicial purposes, it matters not which of these things occurred. Judges are not experts in the field, and are not part of either political branch of the Government. Courts must, in some cases, reconcile competing political interests, but not on the basis of the judges' personal policy preferences. In contrast, an agency to which Congress has delegated policymaking responsibilities may, within the limits of that delegation, properly rely upon the incumbent administration's views of wise policy to inform its judgments. While agencies are not directly accountable to the people, the Chief Executive is, and it is entirely appropriate for this political branch of the Government to make such policy choices resolving the competing interests which Congress itself either inadvertently did not resolve, or intentionally left to be resolved by the *866 agency charged with the administration of the statute in light of everyday realities. When a challenge to an agency construction of a statutory provision, fairly conceptualized, really centers on the wisdom of the agency's policy, rather than whether it is a reasonable choice within a gap left open by Congress, the challenge must fail. In such a case, federal judges who have no constituency have a duty to respect legitimate policy choices made by those who do. The responsibilities for assessing the wisdom of such policy choices and resolving the struggle between competing views of the public interest are not judicial ones: "Our Constitution vests such responsibilities in the political branches." We hold that the EPA's definition of the term "source" is a permissible construction of the statute which seeks to accommodate progress in reducing air pollution with economic growth. "The Regulations which the Administrator has adopted provide what the agency could allowably view as [an] effective reconciliation of these twofold ends" United The judgment of the Court of Appeals is reversed. It is so ordered. JUSTICE MARSHALL and JUSTICE REHNQUIST took no part in the consideration or decision of these cases. JUSTICE O'CONNOR took no part in the decision of these cases. |
Justice Stevens | dissenting | false | United States v. Young | 1985-02-20T00:00:00 | null | https://www.courtlistener.com/opinion/111353/united-states-v-young/ | https://www.courtlistener.com/api/rest/v3/clusters/111353/ | 1,985 | 1984-030 | 1 | 5 | 4 | In Namet v. United States, 373 U.S. 179 (1963), the Court recognized that even in the absence of an objection, trial error may require reversal of a criminal conviction on either of two theories: (1) that it reflected prosecutorial misconduct, or (2) that it was obviously prejudicial to the accused. Id., at 186-187. In that case, after determining that the challenged error did not satisfy either standard, id., at 188-189, the Court concluded that it saw "no reason to require such extravagant protection against errors which were not obviously prejudicial and which the petitioner himself appeared to disregard." Id., at 190.[1] It therefore affirmed the judgment of the Court of Appeals in that case.
*36 In this case the Court has unanimously concluded that the prosecutor's response to defense counsel's closing argument constituted error.[2] It has thus decided against the Government the principal question that its petition for a writ of certiorari presented.[3] The Court has also unanimously concluded that "the prosecutor's comments crossed the lines of permissible conduct established by the ethical rules of the legal profession." Ante, at 14; see also ante, at 25-26 (BRENNAN, J., joined by MARSHALL and BLACKMUN, JJ., concurring in part and dissenting in part). Thus, at least one of the elements that was absent in Namet is present here.
With respect to the second element prejudice there is disagreement and, I submit, some confusion within the Court. The majority opinion carefully avoids denying that the prosecutorial misconduct was prejudicial to the accused. Instead, it concludes that the error did not "unfairly" prejudice the jury, ante, at 19, partly because the error was invited by defense counsel's misconduct and partly because the Court is convinced that respondent is guilty.[4] JUSTICE BRENNAN, on the other hand, correctly explains why this Court should permit the Court of Appeals to decide whether *37 the error was "plain" or "harmless." He therefore would send the case back to that court to perform that task.[5]
In my opinion, it is perfectly clear that the Court of Appeals has already made that determination. I do not understand how anyone could dispute the proposition that the prosecutor's comments were obviously prejudicial. Instead, the question is whether the degree of prejudice, buttressed by the legitimate interest in deterring prosecutorial misconduct, is sufficient to warrant reversal. On that question, the factor of judgment necessarily plays a critical role.[6] I am persuaded that a due respect for the work of our circuit judges, combined with a fair reading of their opinion in this case, warrants the conclusion that they have already done exactly what JUSTICE BRENNAN would have them do again.
The Court of Appeals' opinion took note of defense counsel's failure to make an objection to the improper argument, but nevertheless accepted the contention on appeal that "the prosecutor's conduct substantially prejudiced the Appellant at trial." App. to Pet. for Cert. 9a. After reviewing relevant portions of the transcript that "speak for themselves," id., at 10a, and considering other Tenth Circuit cases dealing with "prejudicial statements made by the prosecution during *38 argument to the jury," ibid., the Court of Appeals expressly concluded that "the above quoted remarks were sufficiently egregious as to constitute plain error." Ibid. I have no doubt that the judges of the Court of Appeals for the Tenth Circuit are familiar with the difference between "harmless error" and "plain error."[7] Rather than asking those judges to supplement the opinion they have already written, I would simply affirm their judgment.
| In the Court recognized that even in the absence of an objection, trial error may require reversal of a criminal conviction on either of two theories: (1) that it reflected prosecutorial misconduct, or (2) that it was obviously prejudicial to the accused. In that case, after determining that the challenged error did not satisfy either standard, the Court concluded that it saw "no reason to require such extravagant protection against errors which were not obviously prejudicial and which the petitioner himself appeared to disregard."[1] It therefore affirmed the judgment of the Court of Appeals in that case. *36 In this case the Court has unanimously concluded that the prosecutor's response to defense counsel's closing argument constituted error.[2] It has thus decided against the Government the principal question that its petition for a writ of certiorari presented.[3] The Court has also unanimously concluded that "the prosecutor's comments crossed the lines of permissible conduct established by the ethical rules of the legal profession." Ante, at 14; see also ante, at 25-26 (BRENNAN, J., joined by MARSHALL and BLACKMUN, JJ., concurring in part and dissenting in part). Thus, at least one of the elements that was absent in Namet is present here. With respect to the second element prejudice there is disagreement and, I submit, some confusion within the Court. The majority opinion carefully avoids denying that the prosecutorial misconduct was prejudicial to the accused. Instead, it concludes that the error did not "unfairly" prejudice the jury, ante, at 19, partly because the error was invited by defense counsel's misconduct and partly because the Court is convinced that respondent is guilty.[4] JUSTICE BRENNAN, on the other hand, correctly explains why this Court should permit the Court of Appeals to decide whether *37 the error was "plain" or "harmless." He therefore would send the case back to that court to perform that task.[5] In my opinion, it is perfectly clear that the Court of Appeals has already made that determination. I do not understand how anyone could dispute the proposition that the prosecutor's comments were obviously prejudicial. Instead, the question is whether the degree of prejudice, buttressed by the legitimate interest in deterring prosecutorial misconduct, is sufficient to warrant reversal. On that question, the factor of judgment necessarily plays a critical role.[6] I am persuaded that a due respect for the work of our circuit judges, combined with a fair reading of their opinion in this case, warrants the conclusion that they have already done exactly what JUSTICE BRENNAN would have them do again. The Court of Appeals' opinion took note of defense counsel's failure to make an objection to the improper argument, but nevertheless accepted the contention on appeal that "the prosecutor's conduct substantially prejudiced the Appellant at trial." App. to Pet. for Cert. 9a. After reviewing relevant portions of the transcript that "speak for themselves," at 10a, and considering other Tenth Circuit cases dealing with "prejudicial statements made by the prosecution during *38 argument to the jury," ib the Court of Appeals expressly concluded that "the above quoted remarks were sufficiently egregious as to constitute plain error." I have no doubt that the judges of the Court of Appeals for the Tenth Circuit are familiar with the difference between "harmless error" and "plain error."[7] Rather than asking those judges to supplement the opinion they have already written, I would simply affirm their judgment. |
Justice Rehnquist | majority | false | United States v. Cherokee Nation of Okla. | 1987-03-31T00:00:00 | null | https://www.courtlistener.com/opinion/111850/united-states-v-cherokee-nation-of-okla/ | https://www.courtlistener.com/api/rest/v3/clusters/111850/ | 1,987 | 1986-063 | 2 | 9 | 0 | In Choctaw Nation v. Oklahoma, 397 U.S. 620 (1970), the Court determined that certain treaties between the Cherokee, Chickasaw, and Choctaw Tribes and the United States granted to the Tribes fee simple title to the riverbed underlying specified portions of the Arkansas River in Oklahoma. The Court found the circumstances sufficient to overcome the "strong presumption against conveyance by the United States" of title to the bed of a navigable water. Montana v. United States, 450 U.S. 544, 552 (1981). See United States v. Holt State Bank, 270 U.S. 49 (1926). The question presented in this case is whether the United States must pay the Cherokee Nation compensation for damage to these riverbed interests caused by navigational improvements which it has made on the Arkansas River. The damage to sand and gravel deposits resulted from the McClellan-Kerr Project, approved by Congress in 1946, Act of July 24, 1946, ch. 595, 60 Stat. 634, 635-636, and designed to improve navigation by construction of a channel in the Arkansas River from its mouth at the Mississippi to Catoosa, Oklahoma. The project was completed in 1971.
After our decision in Choctaw Nation, the Cherokee Nation sought compensation from the Government. Congress refused to fund the claim after the Department of the Interior *702 and the Army Corps of Engineers concluded that the United States' navigational servitude rendered it meritless. See Department of the Interior and Related Agencies Appropriations for 1980: Hearings Before a Subcommittee of the House Committee on Appropriations, 96th Cong., 1st Sess., pt. 7, pp. 379-392 (1979). Congress did, however, provide respondent with the opportunity to seek judicial relief, conferring jurisdiction on the United States District Court for the Eastern District of Oklahoma to determine "any claim which the Cherokee Nation of Oklahoma may have against the United States for any and all damages to Cherokee tribal assets related to and arising from the construction of the [McClellan-Kerr Project]." H. R. 2329, 97th Cong., 1st Sess. (1981).
The Cherokee Nation filed a complaint contending that the construction of the McClellan-Kerr Project resulted in a taking under the Fifth Amendment of the Tribe's riverbed interests without just compensation. The United States in response claimed that its navigational servitude precluded liability for the alleged taking. The District Court granted the Tribe's motion for summary judgment, finding that the decision in Choctaw Nation created a "unique situation by which a portion of the navigable Arkansas River is, essentially, a private waterway belonging exclusively to the Cherokee Nation." App. to Pet. for Cert. 26a. Because the United States did not reserve its navigational servitude in the relevant treaties, the court held, it owed the Tribe just compensation. Id., at 27a.[1]
*703 A divided panel of the Court of Appeals for the Tenth Circuit affirmed, adopting a different analysis. 782 F.2d 871 (1986). The court rejected the District Court's conclusion that the United States' failure to reserve its navigational servitude defeated that interest. It found it "certain [that] the United States retained a navigational servitude in the Arkansas River." Id., at 876. Nevertheless, the court held that the servitude was insufficient to protect the United States from liability. Finding that "the assertion of a navigational servitude on particular waters acknowledges only that the property owner's right to use these waters is shared with the public at large," id., at 877, the court believed that the effect of the navigational servitude varied with the owner's intended use: "When the exercise of that public power affects private ownership rights not connected to a navigational use, the court must balance the public and private interests to decide whether just compensation is due." Ibid. Applying this test, the court concluded that though the Cherokee Nation could not interfere with the United States' exercise of the navigational servitude, it had a right to compensation for any consequent loss of property or diminution in value.[2]
We think the Court of Appeals erred in formulating a balancing test to evaluate this assertion of the navigational servitude. No such "balancing" is required where, as here, the interference with in-stream interests results from an exercise of the Government's power to regulate navigational uses of "the deep streams which penetrate our country in every *704 direction." Gibbons v. Ogden, 9 Wheat. 1, 195 (1824). Though "this Court has never held that the navigational servitude creates a blanket exception to the Takings Clause whenever Congress exercises its Commerce Clause authority to promote navigation," Kaiser Aetna v. United States, 444 U.S. 164, 172 (1979), there can be no doubt that "[t]he Commerce Clause confers a unique position upon the Government in connection with navigable waters." United States v. Rands, 389 U.S. 121, 122 (1967). It gives to the Federal Government "a `dominant servitude,' FPC v. Niagara Mohawk Power Corp., 347 U.S. 239, 249 (1954), which extends to the entire stream and the stream bed below ordinary high-water mark. The proper exercise of this power is not an invasion of any private property rights in the stream or the lands underlying it, for the damage sustained does not result from taking property from riparian owners within the meaning of the Fifth Amendment but from the lawful exercise of a power to which the interests of riparian owners have always been subject." Rands, supra, at 123.[3] See also United States v. Kansas City Life Ins. Co., 339 U.S. 799, 808 (1950); Scranton v. Wheeler, 179 U.S. 141, 163 (1900).
The application of these principles to interference with streambed interests has not depended on balancing this valid public purpose in light of the intended use of those interests by the owner. Thus, in Lewis Blue Point Oyster Cultivation Co. v. Briggs, 229 U.S. 82 (1913), the Court held that no taking occurred where dredging carried out under the direction of the United States destroyed oysters that had been cultivated *705 on privately held lands under the waters of the Great South Bay in New York. The decision rested on the view that the dominant right of navigation "must include the right to use the bed of the water for every purpose which is in aid of navigation." Id., at 87. The Court did not rely on the particular use to which the private owners put the bed, but rather observed that their very title to the submerged lands "is acquired and held subject to the power of Congress to deepen the water over such lands or to use them for any structure which the interest of navigation, in its judgment, may require." Id., at 88. See also United States v. Commodore Park, 324 U.S. 386, 390 (1945); United States v. Chicago, M., St. P. & P. R. Co., 312 U.S. 592, 596-597 (1941).
These well-established principles concerning the exercise of the United States' dominant servitude would, in the usual case, dictate that we reject respondent's "takings" claim. We do not understand respondent to argue otherwise. See e. g., Brief in Opposition 11-12; Tr. of Oral Arg. 16, 28-29. Instead, the Cherokee Nation asserts that its title to the Arkansas River bed is unique in scope and that interference with that interest requires just compensation. Respondent does not rely explicitly on any language of the relevant treaties, but rather on its reading of Choctaw Nation v. Oklahoma, 397 U.S. 620 (1970). We have noted that Choctaw Nation involved "very peculiar circumstances," Montana v. United States, 450 U. S., at 555, n. 5, in that "the Indians were promised virtually complete sovereignty over their new lands." Choctaw Nation, supra, at 635. These circumstances allowed the claimants to overcome the strong presumption against conveyance of riverbed interests by the United States, designed to protect the interests of the States under the equal-footing doctrine. See Montana v. United States, supra, at 551-553; Shively v. Bowlby, 152 U.S. 1, 48-50 (1894). Respondent urges that these circumstances further indicate that the United States abandoned its navigational servitude in the area. Thus, in respondent's view, the *706 treaties by which it gained fee simple title to the bed of the Arkansas River were such as to make the Arkansas River a "private stream," Brief for Respondent 28, "not intended as a public highway or artery of commerce." Id., at 23.
We think that the decision in Choctaw Nation was quite generous to respondent, and we refuse to give a still more expansive and novel reading of respondent's property interests. There is certainly nothing in Choctaw Nation itself that suggests such a broad reading of the conveyance. To the contrary, the Court expressly noted that the United States had no interest in retaining title to the submerged lands because "it had all it was concerned with in its navigational easement via the constitutional power over commerce." Choctaw Nation, supra, at 635 (emphasis added). The parties, including respondent here, clearly understood that the navigational servitude was dominant no matter how the question of riverbed ownership was resolved. See, e. g., Brief for Petitioner in Cherokee Nation v. Oklahoma, O. T. 1969, No. 59, p. 19 ("[T]here is nothing in the conveyance of title to the land beneath the navigable waters which conflicts with the power of the Government to hold such lands for navigation").[4]
Any other conclusion would be wholly extraordinary, for we have repeatedly held that the navigational servitude applies to all holders of riparian and riverbed interests. See Montana v. United States, supra, at 555; United States v. *707 Grand River Dam Authority, 363 U.S. 229, 233 (1960); United States v. Chandler-Dunbar Water Power Co., 229 U.S. 53, 63 (1913), citing Gibson v. United States, 166 U.S. 269, 271 (1897). Indeed, even when the sovereign States gain "the absolute right to all their navigable waters and the soils under them for their own common use" by operation of the equal-footing doctrine, Martin v. Waddell, 16 Pet. 367, 410 (1842), this "absolute right" is unquestionably subject to "the paramount power of the United States to ensure that such waters remain free to interstate and foreign commerce." Montana v. United States, supra, at 551. If the States themselves are subject to this servitude, we cannot conclude that respondent though granted a degree of sovereignty over tribal lands gained an exemption from the servitude simply because it received title to the riverbed interests. Such a waiver of sovereign authority will not be implied, but instead must be " `surrendered in unmistakable terms.' " Bowen v. Public Agencies Opposed to Social Security Entrapment, 477 U.S. 41, 52 (1986), quoting Merrion v. Jicarilla Apache Tribe, 455 U.S. 130, 148 (1982). Respondent can point to no such terms.
We also reject respondent's suggestion that the fiduciary obligations of the United States elevate the Government's actions into a taking. It is, of course, well established that the Government in its dealings with Indian tribal property acts in a fiduciary capacity. See Seminole Nation v. United States, 316 U.S. 286, 296-297 (1942). When it holds lands in trust on behalf of the tribes, the United States may not "give the tribal lands to others, or . . . appropriate them to its own purposes, without rendering, or assuming an obligation to render, just compensation for them." United States v. Creek Nation, 295 U.S. 103, 110 (1935). These principles, however, do little to aid respondent's cause, for they do not create property rights where none would otherwise exist but rather presuppose that the United States has interfered with existing tribal property interests. As we have explained, *708 the tribal interests at issue here simply do not include the right to be free from the navigational servitude, for exercise of the servitude is "not an invasion of any private property rights in the stream or the lands underlying it. . . ." United States v. Rands, 389 U. S., at 123.
The judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings consistent with this opinion.
It is so ordered.
| In Choctaw the Court determined that certain treaties between the Cherokee, Chickasaw, and Choctaw Tribes and the United granted to the Tribes fee simple title to the riverbed underlying specified portions of the Arkansas River in Oklahoma. The Court found the circumstances sufficient to overcome the "strong presumption against conveyance by the United " of title to the bed of a navigable water. See United The question presented in this case is whether the United must pay the Cherokee compensation for damage to these riverbed interests caused by navigational improvements which it has made on the Arkansas River. The damage to sand and gravel deposits resulted from the McClellan-Kerr Project, approved by Congress in 1946, Act of July 24, 1946, ch. 595, 5-6, and designed to improve navigation by construction of a channel in the Arkansas River from its mouth at the Mississippi to Catoosa, Oklahoma. The project was completed in 1971. After our decision in Choctaw the Cherokee sought compensation from the Government. Congress refused to fund the claim after the Department of the Interior *702 and the Army Corps of Engineers concluded that the United ' navigational servitude rendered it meritless. See Department of the Interior and Related Agencies Appropriations for 1980: Hearings Before a Subcommittee of the House Committee on Appropriations, 96th Cong., 1st Sess., pt. 7, pp. 379-392 Congress did, however, provide respondent with the opportunity to seek judicial relief, conferring jurisdiction on the United District Court for the Eastern District of Oklahoma to determine "any claim which the Cherokee of Oklahoma may have against the United for any and all damages to Cherokee tribal assets related to and arising from the construction of the [McClellan-Kerr Project]." H. R. 2329, 97th Cong., 1st Sess. The Cherokee filed a complaint contending that the construction of the McClellan-Kerr Project resulted in a taking under the Fifth Amendment of the Tribe's riverbed interests without just compensation. The United in response claimed that its navigational servitude precluded liability for the alleged taking. The District Court granted the Tribe's motion for summary judgment, finding that the decision in Choctaw created a "unique situation by which a portion of the navigable Arkansas River is, essentially, a private waterway belonging exclusively to the Cherokee" App. to Pet. for Cert. 26a. Because the United did not reserve its navigational servitude in the relevant treaties, the court held, it owed the Tribe just compensation. at 27a.[1] *703 A divided panel of the Court of Appeals for the Tenth Circuit affirmed, adopting a different analysis. The court rejected the District Court's conclusion that the United ' failure to reserve its navigational servitude defeated that interest. It found it "certain [that] the United retained a navigational servitude in the Arkansas River." Nevertheless, the court held that the servitude was insufficient to protect the United from liability. Finding that "the assertion of a navigational servitude on particular waters acknowledges only that the property owner's right to use these waters is shared with the public at large," the court believed that the effect of the navigational servitude varied with the owner's intended use: "When the exercise of that public power affects private ownership rights not connected to a navigational use, the court must balance the public and private interests to decide whether just compensation is due." Applying this test, the court concluded that though the Cherokee could not interfere with the United ' exercise of the navigational servitude, it had a right to compensation for any consequent loss of property or diminution in value.[2] We think the Court of Appeals erred in formulating a balancing test to evaluate this assertion of the navigational servitude. No such "balancing" is required where, as here, the interference with in-stream interests results from an exercise of the Government's power to regulate navigational uses of "the deep streams which penetrate our country in every *704 direction." Though "this Court has never held that the navigational servitude creates a blanket exception to the Takings Clause whenever Congress exercises its Commerce Clause authority to promote navigation," Kaiser there can be no doubt that "[t]he Commerce Clause confers a unique position upon the Government in connection with navigable waters." United It gives to the Federal Government "a `dominant servitude,' (4), which extends to the entire stream and the stream bed below ordinary high-water mark. The proper exercise of this power is not an invasion of any private property rights in the stream or the lands underlying it, for the damage sustained does not result from taking property from riparian owners within the meaning of the Fifth Amendment but from the lawful exercise of a power to which the interests of riparian owners have always been subject."[3] See also United (0); The application of these principles to interference with streambed interests has not depended on balancing this valid public purpose in light of the intended use of those interests by the owner. Thus, in Lewis Blue Point Oyster Cultivation the Court held that no taking occurred where dredging carried out under the direction of the United destroyed oysters that had been cultivated *705 on privately held lands under the waters of the Great South Bay in New York. The decision rested on the view that the dominant right of navigation "must include the right to use the bed of the water for every purpose which is in aid of navigation." The Court did not rely on the particular use to which the private owners put the bed, but rather observed that their very title to the submerged lands "is acquired and held subject to the power of Congress to deepen the water over such lands or to use them for any structure which the interest of navigation, in its judgment, may require." See also United ; United These well-established principles concerning the exercise of the United ' dominant servitude would, in the usual case, dictate that we reject respondent's "takings" claim. We do not understand respondent to argue otherwise. See e. g., Brief in Opposition 11-12; Tr. of Oral Arg. 16, 28-29. Instead, the Cherokee asserts that its title to the Arkansas River bed is unique in scope and that interference with that interest requires just compensation. Respondent does not rely explicitly on any language of the relevant treaties, but rather on its reading of Choctaw We have noted that Choctaw involved "very peculiar circumstances," n. 5, in that "the Indians were promised virtually complete sovereignty over their new lands." Choctaw These circumstances allowed the claimants to overcome the strong presumption against conveyance of riverbed interests by the United designed to protect the interests of the under the equal-footing doctrine. See ; Respondent urges that these circumstances further indicate that the United abandoned its navigational servitude in the area. Thus, in respondent's view, the *706 treaties by which it gained fee simple title to the bed of the Arkansas River were such as to make the Arkansas River a "private stream," Brief for Respondent 28, "not intended as a public highway or artery of commerce." We think that the decision in Choctaw was quite generous to respondent, and we refuse to give a still more expansive and novel reading of respondent's property interests. There is certainly nothing in Choctaw itself that suggests such a broad reading of the conveyance. To the contrary, the Court expressly noted that the United had no interest in retaining title to the submerged lands because "it had all it was concerned with in its navigational easement via the constitutional power over commerce." Choctaw The parties, including respondent here, clearly understood that the navigational servitude was dominant no matter how the question of riverbed ownership was resolved. See, e. g., Brief for Petitioner in Cherokee O. T. 1969, No. 59, p. 19 ("[T]here is nothing in the conveyance of title to the land beneath the navigable waters which conflicts with the power of the Government to hold such lands for navigation").[4] Any other conclusion would be wholly extraordinary, for we have repeatedly held that the navigational servitude applies to all holders of riparian and riverbed interests. See ; United v. *707 Grand River Dam Authority, ; United v. Chandler-Dunbar Water Power Co., citing Gibson v. United Indeed, even when the sovereign gain "the absolute right to all their navigable waters and the soils under them for their own common use" by operation of the equal-footing doctrine, this "absolute right" is unquestionably subject to "the paramount power of the United to ensure that such waters remain free to interstate and foreign commerce." If the themselves are subject to this servitude, we cannot conclude that respondent though granted a degree of sovereignty over tribal lands gained an exemption from the servitude simply because it received title to the riverbed interests. Such a waiver of sovereign authority will not be implied, but instead must be " `surrendered in unmistakable terms.' " quoting Respondent can point to no such terms. We also reject respondent's suggestion that the fiduciary obligations of the United elevate the Government's actions into a taking. It is, of course, well established that the Government in its dealings with Indian tribal property acts in a fiduciary capacity. See Seminole v. United When it holds lands in trust on behalf of the tribes, the United may not "give the tribal lands to others, or appropriate them to its own purposes, without rendering, or assuming an obligation to render, just compensation for them." United v. Creek These principles, however, do little to aid respondent's cause, for they do not create property rights where none would otherwise exist but rather presuppose that the United has interfered with existing tribal property interests. As we have explained, *708 the tribal interests at issue here simply do not include the right to be free from the navigational servitude, for exercise of the servitude is "not an invasion of any private property rights in the stream or the lands underlying it." United 389 U. S., The judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings consistent with this opinion. It is so ordered. |
Justice Rehnquist | dissenting | false | Sporhase v. Nebraska Ex Rel. Douglas | 1982-07-02T00:00:00 | null | https://www.courtlistener.com/opinion/110799/sporhase-v-nebraska-ex-rel-douglas/ | https://www.courtlistener.com/api/rest/v3/clusters/110799/ | 1,982 | 1981-176 | 2 | 7 | 2 | The issue presented by this case, and the only issue, is whether the existence of the Commerce Clause of the United States Constitution by itself, in the absence of any action by Congress, invalidates some or all of Neb. Rev. Stat. § 46-613.01 (1978), which relates to ground water. But instead of confining its opinion to this question, the Court first quite gratuitously undertakes to answer the question of whether the authority of Congress to regulate interstate commerce, conferred by the same provision of the Constitution, would enable it to legislate with respect to ground-water overdraft in some or all of the States.
That these two questions are quite distinct leaves no room for doubt. Congress may regulate not only the stream of commerce itself, but also activities which affect interstate commerce, including wholly intrastate activities. See, e. g., Kirschbaum Co. v. Walling, 316 U.S. 517 (1942); United States v. Darby, 312 U.S. 100 (1941); Houston & Texas R. Co. v. United States, 234 U.S. 342 (1914). The activity upon which the regulatory effect of the congressional statute falls in many of these cases does not directly involve articles of commerce at all. For example, in Kirschbaum, the employees were engaged in the operation and maintenance of a loft building in which large quantities of goods for interstate commerce were produced; no one contended that these employees themselves, or the work which they actually performed, dealt with articles of commerce. Nonetheless, the provisions of the Fair Labor Standards Act were applied to them because Congress extended the terms of the Act not only to those who were "engaged in commerce" but also to those who were engaged "in the production of goods for commerce." 316 U.S., at 522.
Thus, the authority of Congress under the power to regulate interstate commerce may reach a good deal further than *962 the mere negative impact of the Commerce Clause in the absence of any action by Congress. Upon a showing that ground-water overdraft has a substantial economic effect on interstate commerce, for example, Congress arguably could regulate ground-water overdraft, even if ground water is not an "article of commerce" itself. See, e. g., Hodel v. Virginia Surface Mining & Reclamation Assn., 452 U.S. 264, 281-283 (1981); id., at 310-313 (REHNQUIST, J., concurring in judgment); Wickard v. Filburn, 317 U.S. 111 (1942). It is therefore wholly unnecessary to decide whether Congress could regulate ground-water overdraft in order to decide this case; since Congress has not undertaken such a regulation, I would leave the determination of its validity until such time as it is necessary to decide that question.
The question actually involved in this case is whether Neb. Rev. Stat. § 46-613.01 (1978) runs afoul of the unexercised authority of Congress to regulate interstate commerce. While the Court apparently agrees that our equitable apportionment decrees in cases such as Wyoming v. Colorado, 353 U.S. 953 (1957), and the execution and approval of interstate compacts apportioning water have given rise to "the legal expectation that under certain circumstances each State may restrict water within its borders," ante, at 956, it insists on an elaborate balancing process in which the State's "interest" is weighed under traditional Commerce Clause analysis.
I think that in more than one of our cases in which a State has invoked our original jurisdiction, the unsoundness of the Court's approach is manifest. For example, in Georgia v. Tennessee Copper Co., 206 U.S. 230, 237 (1907), the Court said:
"This is a suit by a State for an injury to it in its capacity of quasi-sovereign. In that capacity the State has an interest independent of and behind the titles of its citizens, in all the earth and air within its domain. It has the last word as to whether its mountains shall be stripped of their forests and its inhabitants shall breathe pure air."
*963 Five years earlier, in Kansas v. Colorado, 185 U.S. 125, 142, 145-146 (1902), the Court had made clear that a State's quasi-sovereign interest in the flow of surface and subterranean water within its borders was of the same magnitude as its interest in pure air or healthy forests.
In my view, these cases appropriately recognize the traditional authority of a State over resources within its boundaries which are essential not only to the well-being but often to the very lives of its citizens. In the exercise of this authority, a State may so regulate a natural resource as to preclude that resource from attaining the status of an "article of commerce" for the purposes of the negative impact of the Commerce Clause. It is difficult, if not impossible, to conclude that "commerce" exists in an item that cannot be reduced to possession under state law and in which the State recognizes only a usufructuary right. "Commerce" cannot exist in a natural resource that cannot be sold, rented, traded, or transferred, but only used.
Of course, a State may not discriminate against interstate commerce when it regulates even such a resource. If the State allows indiscriminate intrastate commercial dealings in a particular resource, it may have a difficult task proving that an outright prohibition on interstate commercial dealings is not such a discrimination. I had thought that this was the basis for this Court's decisions in Hughes v. Oklahoma, 441 U.S. 322 (1979), Pennsylvania v. West Virginia, 262 U.S. 553 (1923), and West v. Kansas Natural Gas Co., 221 U.S. 229 (1911). In each case, the State permitted a natural resource to be reduced to private possession, permitted an intrastate market to exist in that resource, and either barred interstate commerce entirely or granted its residents a commercial preference.[1]
*964 By contrast, Nebraska so regulates ground water that it cannot be said that the State permits any "commerce," intrastate or interstate, to exist in this natural resource. As with almost all of the Western States, Nebraska does not recognize an absolute ownership interest in ground water, but grants landowners only a right to use ground water on the land from which it has been extracted. Moreover, the landowner's right to use ground water is limited. Nebraska landowners may not extract ground water "in excess of a reasonable and beneficial use upon the land in which he owns, especially if such use is injurious to others who have substantial rights to the waters, and if the natural underground supply is insufficient for all owners, each is entitled to a reasonable proportion of the whole." Olson v. City of Wahoo, 124 Neb. 802, 811, 248 N.W. 304, 308 (1933). With the exception of municipal water systems, Nebraska forbids any transportation of ground water off the land owned or controlled by the person who has appropriated the water from its subterranean source. 208 Neb. 703, 710, 305 N.W.2d 614, 619 (1981). See App. 68-69.
Nebraska places additional restrictions on ground-water users within certain areas, such as the portion of appellants' land situated in Nebraska, where the shortage of ground water is determined to be critical. Water users in appellants' district are permitted only to irrigate the acreage irrigated in 1977, or the average number of acres irrigated between 1972 and 1976, whichever is greater, and must obtain permission from the water district's board before any *965 additional acreage may be placed under irrigation. The amount of ground water that may be extracted is strictly limited on an acre-inch-per-irrigated-acre basis. There are also detailed regulations as to the spacing of wells and the use and operation of flow meters. Id., at 71-82.
Since Nebraska recognizes only a limited right to use ground water on land owned by the appropriator, it cannot be said that "commerce" in ground water exists as far as Nebraska is concerned. Therefore, it cannot be said that Neb. Rev. Stat. § 46-613.01 (1978) either discriminates against, or "burdens," interstate commerce. Section 46-613.01 is simply a regulation of the landowner's right to use ground water extracted from lands he owns within Nebraska.[2] Unlike the Court, I cannot agree that Nebraska's limitation upon a landowner's right to extract water from his land situated in Nebraska for his own use on land he owns in an adjoining State runs afoul of Congress' unexercised authority to regulate interstate commerce.[3]
| The issue presented by this case, and the only issue, is whether the existence of the Commerce Clause of the United States Constitution by itself, in the absence of any action by Congress, invalidates some or all of (1978), which relates to ground water. But instead of confining its opinion to this question, the Court first quite gratuitously undertakes to answer the question of whether the authority of Congress to regulate interstate commerce, conferred by the same provision of the Constitution, would enable it to legislate with respect to ground-water overdraft in some or all of the States. That these two questions are quite distinct leaves no room for doubt. Congress may regulate not only the stream of commerce itself, but also activities which affect interstate commerce, including wholly intrastate activities. See, e. g., Kirschbaum ; United ; Houston & Texas R. The activity upon which the regulatory effect of the congressional statute falls in many of these cases does not directly involve articles of commerce at all. For example, in Kirschbaum, the employees were engaged in the operation and maintenance of a loft building in which large quantities of goods for interstate commerce were produced; no one contended that these employees themselves, or the work which they actually performed, dealt with articles of commerce. Nonetheless, the provisions of the Fair Labor Standards Act were applied to them because Congress extended the terms of the Act not only to those who were "engaged in commerce" but also to those who were engaged "in the production of goods for commerce." Thus, the authority of Congress under the power to regulate interstate commerce may reach a good deal further than *962 the mere negative impact of the Commerce Clause in the absence of any action by Congress. Upon a showing that ground-water overdraft has a substantial economic effect on interstate commerce, for example, Congress arguably could regulate ground-water overdraft, even if ground water is not an "article of commerce" itself. See, e. g., ; ; It is therefore wholly unnecessary to decide whether Congress could regulate ground-water overdraft in order to decide this case; since Congress has not undertaken such a regulation, I would leave the determination of its validity until such time as it is necessary to decide that question. The question actually involved in this case is whether (1978) runs afoul of the unexercised authority of Congress to regulate interstate commerce. While the Court apparently agrees that our equitable apportionment decrees in cases such as and the execution and approval of interstate compacts apportioning water have given rise to "the legal expectation that under certain circumstances each State may restrict water within its borders," ante, at 956, it insists on an elaborate balancing process in which the State's "interest" is weighed under traditional Commerce Clause analysis. I think that in more than one of our cases in which a State has invoked our original jurisdiction, the unsoundness of the Court's approach is manifest. For example, in the Court said: "This is a suit by a State for an injury to it in its capacity of quasi-sovereign. In that capacity the State has an interest independent of and behind the titles of its citizens, in all the earth and air within its domain. It has the last word as to whether its mountains shall be stripped of their forests and its inhabitants shall breathe pure air." *963 Five years earlier, in the Court had made clear that a State's quasi-sovereign interest in the flow of surface and subterranean water within its borders was of the same magnitude as its interest in pure air or healthy forests. In my view, these cases appropriately recognize the traditional authority of a State over resources within its boundaries which are essential not only to the well-being but often to the very lives of its citizens. In the exercise of this authority, a State may so regulate a natural resource as to preclude that resource from attaining the status of an "article of commerce" for the purposes of the negative impact of the Commerce Clause. It is difficult, if not impossible, to conclude that "commerce" exists in an item that cannot be reduced to possession under state law and in which the State recognizes only a usufructuary right. "Commerce" cannot exist in a natural resource that cannot be sold, rented, traded, or transferred, but only used. Of course, a State may not discriminate against interstate commerce when it regulates even such a resource. If the State allows indiscriminate intrastate commercial dealings in a particular resource, it may have a difficult task proving that an outright prohibition on interstate commercial dealings is not such a discrimination. I had thought that this was the basis for this Court's decisions in and In each case, the State permitted a natural resource to be reduced to private possession, permitted an intrastate market to exist in that resource, and either barred interstate commerce entirely or granted its residents a commercial preference.[1] *964 By contrast, Nebraska so regulates ground water that it cannot be said that the State permits any "commerce," intrastate or interstate, to exist in this natural resource. As with almost all of the Western States, Nebraska does not recognize an absolute ownership interest in ground water, but grants landowners only a right to use ground water on the land from which it has been extracted. Moreover, the landowner's right to use ground water is limited. Nebraska landowners may not extract ground water "in excess of a reasonable and beneficial use upon the land in which he owns, especially if such use is injurious to others who have substantial rights to the waters, and if the natural underground supply is insufficient for all owners, each is entitled to a reasonable proportion of the whole." With the exception of municipal water systems, Nebraska forbids any transportation of ground water off the land owned or controlled by the person who has appropriated the water from its subterranean source. See App. 68-69. Nebraska places additional restrictions on ground-water users within certain areas, such as the portion of appellants' land situated in Nebraska, where the shortage of ground water is determined to be critical. Water users in appellants' district are permitted only to irrigate the acreage irrigated in 1977, or the average number of acres irrigated between 1972 and 1976, whichever is greater, and must obtain permission from the water district's board before any *965 additional acreage may be placed under irrigation. The amount of ground water that may be extracted is strictly limited on an acre-inch-per-irrigated-acre basis. There are also detailed regulations as to the spacing of wells and the use and operation of flow meters. Since Nebraska recognizes only a limited right to use ground water on land owned by the appropriator, it cannot be said that "commerce" in ground water exists as far as Nebraska is concerned. Therefore, it cannot be said that (1978) either discriminates against, or "burdens," interstate commerce. Section 46-613.01 is simply a regulation of the landowner's right to use ground water extracted from lands he owns within Nebraska.[2] Unlike the Court, I cannot agree that Nebraska's limitation upon a landowner's right to extract water from his land situated in Nebraska for his own use on land he owns in an adjoining State runs afoul of Congress' unexercised authority to regulate interstate commerce.[3] |
Justice Blackmun | dissenting | false | FBI v. Abramson | 1982-05-24T00:00:00 | null | https://www.courtlistener.com/opinion/110712/fbi-v-abramson/ | https://www.courtlistener.com/api/rest/v3/clusters/110712/ | 1,982 | 1981-096 | 1 | 5 | 4 | Exemption 7 of the Freedom of Information Act, 5 U.S. C. § 552(b)(7), permits agencies to withhold "investigatory records compiled for law enforcement purposes, but only to the extent that the production of such records would . . . (C) constitute an unwarranted invasion of personal privacy." (Emphasis added.) The Court today holds that this language authorizes petitioner FBI to withhold investigatory records not compiled for law enforcement purposes simply because some information contained in those records was compiled for such purposes. The Court declares that "[o]nce it is established that information was compiled pursuant to a legitimate law enforcement investigation and that disclosure of such information would lead to one of the listed harms [in Exemption 7], the information is exempt." Ante, at 631 (emphasis added).
I cannot escape the conclusion that the Court has simply substituted the word "information" for the word "records" in Exemption 7(C). Yet we have earlier recognized that "[t]he Freedom of Information Act deals with `agency records,' not information in the abstract." Forsham v. Harris, 445 U.S. 169, 185 (1980). I agree with JUSTICE O'CONNOR's assessment *633 that the legislative history reveals that Congress chose the term "records," rather than the word "information," advisedly. The Court's unwillingness to give the statutory language its plain meaning requires judges who are evaluating Exemption 7(C) claims to parse agency records and determine whether any piece of information contained in those records was originally compiled for a law enforcement purpose. Because the Court presents no reason, convincing to me, why its deviation from the statutory language is necessary or desirable, I respectfully dissent. | Exemption 7 of the Freedom of Information Act, 5 U.S. C. 552(b)(7), permits agencies to withhold "investigatory records compiled for law enforcement purposes, but only to the extent that the production of such records would (C) constitute an unwarranted invasion of personal privacy." (Emphasis added.) The Court today holds that this language authorizes petitioner FBI to withhold investigatory records not compiled for law enforcement purposes simply because some information contained in those records was compiled for such purposes. The Court declares that "[o]nce it is established that information was compiled pursuant to a legitimate law enforcement investigation and that disclosure of such information would lead to one of the listed harms [in Exemption 7], the information is exempt." Ante, at 631 (emphasis added). I cannot escape the conclusion that the Court has simply substituted the word "information" for the word "records" in Exemption 7(C). Yet we have earlier recognized that "[t]he Freedom of Information Act deals with `agency records,' not information in the abstract." I agree with JUSTICE O'CONNOR's assessment *633 that the legislative history reveals that Congress chose the term "records," rather than the word "information," advisedly. The Court's unwillingness to give the statutory language its plain meaning requires judges who are evaluating Exemption 7(C) claims to parse agency records and determine whether any piece of information contained in those records was originally compiled for a law enforcement purpose. Because the Court presents no reason, convincing to me, why its deviation from the statutory language is necessary or desirable, I respectfully dissent. |
Justice Stevens | concurring | false | Reves v. Ernst & Young | 1990-04-16T00:00:00 | null | https://www.courtlistener.com/opinion/112375/reves-v-ernst-young/ | https://www.courtlistener.com/api/rest/v3/clusters/112375/ | 1,990 | 1989-031 | 2 | 5 | 4 | While I join the Court's opinion, an important additional consideration supports my conclusion that these notes are securities *74 notwithstanding the statute's exclusion for currency and commercial paper that has a maturity of no more than nine months. See 15 U.S. C. § 78c(a)(10) (§ 3(a)(10) of the Securities Exchange Act of 1934). The Courts of Appeals have been unanimous in rejecting a literal reading of that exclusion. They have instead concluded that "when Congress spoke of notes with a maturity not exceeding nine months, it meant commercial paper, not investment securities." Sanders v. John Nuveen & Co., 463 F.2d 1075, 1080 (CA7), cert. denied, 409 U.S. 1009 (1972). This view was first set out in an opinion by Judge Sprecher, and soon thereafter endorsed by Chief Judge Friendly. Zeller v. Bogue Electric Mfg. Corp., 476 F.2d 795, 800 (CA2), cert. denied, 414 U.S. 908 (1973). Others have adopted the same position since. See, e. g., McClure v. First Nat. Bank of Lubbock, Texas, 497 F.2d 490, 494-495 (CA5 1974), cert. denied, 420 U.S. 930 (1975); Holloway v. Peat, Marwick, Mitchell & Co., 879 F.2d 772, 778 (CA10 1989); Baurer v. Planning Group, Inc., 215 U. S. App. D. C. 384, 389-391, 669 F.2d 770, 775-777 (1981).
In my view such a settled construction of an important federal statute should not be disturbed unless and until Congress so decides. "[A]fter a statute has been construed, either by this Court or by a consistent course of decision by other federal judges and agencies, it acquires a meaning that should be as clear as if the judicial gloss had been drafted by the Congress itself." Shearson/American Express Inc. v. McMahon, 482 U.S. 220, 268 (1987) (STEVENS, J., concurring in part and dissenting in part); see also Chesapeake & Ohio R. Co. v. Schwalb, 493 U.S. 40, 51 (1989) (STEVENS, J., concurring in judgment). What I have said before of taxation applies equally to securities regulation: "there is a strong interest in enabling" those affected "to predict the legal consequences of their proposed actions, and there is an even stronger general interest in ensuring that the responsibility for making changes in settled law rests squarely on *75 the shoulders of Congress." Commissioner v. Fink, 483 U.S. 89, 101 (1987) (dissenting opinion). Past errors may in rare cases be "sufficiently blatant" to overcome the " `strong presumption of continued validity that adheres in the judicial interpretation of a statute,' " but this is not such a case. Id., at 103 (quoting Square D Co. v. Niagara Frontier Tariff Bureau, Inc., 476 U.S. 409, 424 (1986)).
Indeed, the agreement among the Courts of Appeals is made all the more impressive in this case because it is buttressed by the views of the Securities and Exchange Commission. See Securities Act Release No. 33-4412, 26 Fed. Reg. 9158 (1961) (construing § 3(a)(3) of the Securities Act of 1933, the 1933 Act's counterpart to § 3(a)(10) of the 1934 Act). We have ourselves referred to the exclusion for notes with a maturity not exceeding nine months as an exclusion for "commercial paper." Securities Industry Assn. v. Board of Governors of Federal Reserve System, 468 U.S. 137, 150-152 (1984). Perhaps because the restriction of the exclusion to commercial paper is so well established, respondents admit that they did not even argue before the Court of Appeals that their notes were covered by the exclusion. A departure from this reliable consensus would upset the justified expectations of both the legal and investment communities.
Moreover, I am satisfied that the interpretation of the statute expounded by Judge Sprecher and Judge Friendly was entirely correct. As Judge Friendly has observed, the exclusion for short-term notes must be read in light of the prefatory language in § 2 of the 1933 Act and § 3 of the 1934 Act. See Exchange Nat. Bank of Chicago v. Touche Ross & Co., 544 F.2d 1126, 1131-1132, and nn. 7-10 (CA2 1976). Pursuant to that language, definitions specified by the Acts may not apply if the "context otherwise requires." Marine Bank v. Weaver, 455 U.S. 551, 556 (1982) (the "broad statutory definition is preceded, however, by the statement that the terms mentioned are not to be considered securities if `the context otherwise requires . . .' "); accord, Landreth Timber *76 Co. v. Landreth, 471 U.S. 681, 697-698 (1985) (STEVENS, J., dissenting). The context clause thus permits a judicial construction of the statute which harmonizes the facially rigid terms of the 9-month exclusion with the evident intent of Congress. Exchange Nat. Bank, 544 F. 2d, at 1132-1133. The legislative history of § 3(a)(3) of the 1933 Act indicates that the exclusion was intended to cover only commercial paper, and the SEC has so construed it. Sanders, 463 F. 2d, at 1079, and nn. 12-13; Zeller, 476 F. 2d, at 799-800, and n. 6. As the Courts of Appeals have agreed, there is no apparent reason to construe § 3(a)(10) of the 1934 Act differently. Sanders, 463 F. 2d, at 1079-1080, and n. 15; Zeller, 476 F. 2d, at 800. See also Comment, The Commercial Paper Market and the Securities Acts, 39 U. Chi. L. Rev. 362, 398 (1972).
For these reasons and those stated in the opinion of the Court, I conclude that the notes issued by respondents are securities within the meaning of the 1934 Act.
CHIEF JUSTICE REHNQUIST, with whom JUSTICE WHITE, JUSTICE O'CONNOR, and JUSTICE SCALIA join, concurring in part and dissenting in part.
I join Part II of the Court's opinion, but dissent from Part III and the statements of the Court's judgment in Parts I and IV. In Part III, the Court holds that these notes were not covered by the statutory exemption for "any note . . . which has a maturity at the time of issuance of not exceeding nine months." Treating demand notes as if they were a recent development in the law of negotiable instruments, the Court says "if it is plausible to regard a demand note as having an immediate maturity because demand could be made immediately, it is also plausible to regard the maturity of a demand note as being in excess of nine months because demand could be made many years or decades into the future. Given this ambiguity, the exclusion must be interpreted in accordance with its purpose." Ante, at 72-73.
*77 But the terms "note" and "maturity" did not spring full blown from the head of Congress in 1934. Neither are demand notes of recent vintage. "Note" and "maturity" have been terms of art in the legal profession for centuries, and a body of law concerning the characteristics of demand notes, including their maturity, was in existence at the time Congress passed the 1934 Act.
In construing any terms whose meanings are less than plain, we depend on the common understanding of those terms at the time of the statute's creation. See Gilbert v. United States, 370 U.S. 650, 655 (1962) ("[I]n the absence of anything to the contrary it is fair to assume that Congress use[s a] word in [a] statute in its common-law sense"); Roadway Express, Inc. v. Piper, 447 U.S. 752, 759 (1980) (in construing a word in a statute, "we may look to the contemporaneous understanding of the term"); Standard Oil Co. of New Jersey v. United States, 221 U.S. 1, 59 (1911) (common-law meaning "presumed" to have been Congress' intent); see also Lorillard v. Pons, 434 U.S. 575, 583 (1978); United States v. Spencer, 839 F.2d 1341, 1344 (CA9 1988). Contemporaneous editions of legal dictionaries defined "maturity" as "[t]he time when a . . . note becomes due." Black's Law Dictionary 1170 (3d ed. 1933); Cyclopedic Law Dictionary 649 (2d ed. 1922). Pursuant to the dominant consensus in the case law, instruments payable on demand were considered immediately "due" such that an action could be brought at any time without any other demand than the suit. See, e. g., M. Bigelow, Law of Bills, Notes, and Checks § 349, p. 265 (3d ed. W. Lile rev. 1928); 8 C. J., Bills and Notes § 602, p. 406, and n. 83 (1916). According to Bigelow:
"So far as maker and acceptor are concerned, paper payable. . . `on demand' is due from the moment of its delivery, and payment may be required on any business day, including the day of its issue, within the statute of limitations. In other words, as to these parties the paper is at maturity all the time, and no demand of payment is necessary *78 before suit thereon." Bigelow, supra, § 349, at 265 (emphasis added; emphasis in original deleted; footnote omitted).
To be sure, demand instruments were considered to have "the peculiar quality of having two maturity dates one for the purpose of holding to his obligation the party primarily liable (e. g. maker), and the other for enforcing the contracts of parties secondarily liable (e. g. drawer and indorsers)." Bigelow, supra, § 350, at 266 (emphasis omitted). But only the rule of immediate maturity respecting makers of demand notes has any bearing on our examination of the exemption; the language in the Act makes clear that it is the "maturity at time of issuance" with which we are concerned. 15 U.S. C. § 78c(a)(10). Accordingly, in the absence of some compelling indication to the contrary, the maturity date exemption must encompass demand notes because they possess "maturity at the time of issuance of not exceeding nine months."[*]
*79 Petitioners and the lower court decisions cited by JUSTICE STEVENS rely, virtually exclusively, on the legislative history of § 3(a)(3) of the 1933 Act for the proposition that the term "any note" in the exemption in § 3(a)(10) of the 1934 Act encompass only notes having the character of short-term "commercial paper" exchanged among sophisticated traders. I am not altogether convinced that the legislative history of § 3(a)(3) supports that interpretation even with respect to the term "any note" in the exemption in § 3(a)(3), and to bodily transpose that legislative history to another statute has little to commend it as a method of statutory construction.
The legislative history of the 1934 Act under which this case arises contains nothing which would support a restrictive reading of the exemption in question. Nor does the legislative history of § 3(a)(3) of the 1933 Act support the asserted limited construction of the exemption in § 3(a)(10) of the 1934 Act. Though the two most pertinent sources of congressional commentary on § 3(a)(3) H. R. Rep. No. 85, 73d Cong., 1st Sess., 15 (1933) and S. Rep. No. 47, 73d Cong., 1st Sess., 3-4 (1933) do suggest an intent to limit § 3(a)(3)'s exemption to short-term commercial paper, the references in those Reports to commercial paper simply did not survive in the language of the enactment. Indeed, the Senate Report stated "[n]otes, drafts, bills of exchange, and bankers' acceptances which are commercial paper and arise out of current commercial, agricultural, or industrial transactions, and which are not intended to be marketed to the public, are exempted. . . ." S. Rep. No. 47, supra, at 3-4 (emphasis added). Yet the provision enacted in § 3(a)(3) *80 of the 1933 Act exempts "[a]ny note, draft, bill of exchange, or banker's acceptance which arises out of a current transaction or the proceeds of which have been or are to be used for current transactions, and which has a maturity at the time of issuance of not exceeding nine months . . . ." 15 U.S. C. § 77c(a)(3) (emphasis added).
Such broadening of the language in the enacted version of § 3(a)(3), relative to the prototype from which it sprang, cannot easily be dismissed in interpreting § 3(a)(3). A fortiori, the legislative history's restrictive meaning cannot be imputed to the facially broader language in a different provision of another Act. Although I do not doubt that both the 1933 and 1934 Act exemptions encompass short-term commercial paper, the expansive language in the statutory provisions is strong evidence that, in the end, Congress meant for commercial paper merely to be a subset of a larger class of exempted short-term instruments.
The plausibility of imputing a restrictive reading to § 3(a) (10) from the legislative history of § 3(a)(3) is further weakened by the imperfect analogy between the two provisions in terms of both phraseology and nature. Section 3(a)(10) lacks the cryptic phrase in § 3(a)(3) which qualifies the class of instruments eligible for exemption as those arising "out of . . . current transaction[s] or the proceeds of which have been or are to be used for current transactions . . . ." While that passage somehow may strengthen an argument for limiting the exemption in § 3(a)(3) to commercial paper, its absence in § 3(a)(10) conversely militates against placing the same limitation thereon.
The exemption in § 3(a)(3) excepts the short-term instruments it covers solely from the registration requirements of the 1933 Act. The same instruments are not exempted from the 1933 Act's antifraud provisions. Compare 15 U.S. C. § 77c(a)(3) with 15 U.S. C. §§ 77l(2) and 77q(c); see also Securities Industry Assn. v. Board of Governors of Federal *81 Reserve System, 468 U.S. 137, 151 (1984). By contrast, the exemption in § 3(a)(10) of the 1934 Act exempts instruments encompassed thereunder from the entirety of the coverage of the 1934 Act including, conspicuously, the Act's antifraud provisions.
JUSTICE STEVENS argues that the suggested limited reading of the exemption in § 3(a)(10) of the 1934 Act "harmonizes" the plain terms of that provision with the legislative history of the 1933 Act. Ante, at 76. In his view, such harmony is required by the "context clause" at the beginning of the 1934 Act's general definition of "security." It seems to me, instead, that harmony is called for primarily between § 3(a)(10)'s general definition and its specific exemption. The fairest reading of the exemption in light of the context clause is that the situation described in the exemption notes with maturities at issue of less than nine months is one contextual exception Congress especially wanted courts to recognize. Such a reading does not render the context clause superfluous; it merely leaves it to the judiciary to flesh out additional "context clause" exceptions.
JUSTICE STEVENS also states that we have previously referred to the exemption in § 3(a)(10) as an exclusion for commercial paper. Ante, at 76 (citing Securities Industry Assn., supra, at 150-152). In the Securities Industry Assn. dictum, however, we described the exemption in § 3(a)(10) merely as "encompass[ing]" commercial paper and in no way concluded that the exemption was limited to commercial paper. See 468 U.S., at 150-151. Indeed, in Securities Industry Assn., our purpose in referring to § 3(a)(10) was to assist our determination whether commercial paper was even included in the 73d Congress' use of the words "notes . . . or other securities" in the Glass-Steagall Banking Act of 1933.
In sum, there is no justification for looking beyond the plain terms of § 3(a)(10), save for ascertaining the meaning of "maturity" with respect to demand notes. That inquiry reveals *82 that the Co-Op's demand notes come within the purview of the section's exemption for short-term securities. I would therefore affirm the judgment of the Court of Appeals, though on different reasoning.
| While I join the Court's opinion, an important additional consideration supports my conclusion that these notes are securities *74 notwithstanding the statute's exclusion for currency and commercial paper that has a maturity of no more than nine months. See 15 U.S. C. 78c(a)(10) ( 3(a)(10) of the Securities Exchange Act of 1934). The Courts of Appeals have been unanimous in rejecting a literal reading of that exclusion. They have instead concluded that "when Congress spoke of notes with a maturity not exceeding nine months, it meant commercial paper, not investment securities." (CA7), cert. denied, This view was first set out in an opinion by Judge Sprecher, and soon thereafter endorsed by Chief Judge Friendly. (CA2), cert. denied, Others have adopted the same position since. See, e. g., cert. denied, ; ; In my view such a settled construction of an important federal statute should not be disturbed unless and until Congress so decides. "[A]fter a statute has been construed, either by this Court or by a consistent course of decision by other federal judges and agencies, it acquires a meaning that should be as clear as if the judicial gloss had been drafted by the Congress itself." Shearson/American Express ; see also Chesapeake & Ohio R. What I have said before of taxation applies equally to securities regulation: "there is a strong interest in enabling" those affected "to predict the legal consequences of their proposed actions, and there is an even stronger general interest in ensuring that the responsibility for making changes in settled law rests squarely on *75 the shoulders of Congress." Past errors may in rare cases be "sufficiently blatant" to overcome the " `strong presumption of continued validity that adheres in the judicial interpretation of a statute,' " but this is not such a case. ). Indeed, the agreement among the Courts of Appeals is made all the more impressive in this case because it is buttressed by the views of the Securities and Exchange Commission. See Securities Act Release No. 33-4412, (1961) (construing 3(a)(3) of the Securities Act of 1933, the 1933 Act's counterpart to 3(a)(10) of the 1934 Act). We have ourselves referred to the exclusion for notes with a maturity not exceeding nine months as an exclusion for "commercial paper." Securities Industry Perhaps because the restriction of the exclusion to commercial paper is so well established, respondents admit that they did not even argue before the Court of Appeals that their notes were covered by the exclusion. A departure from this reliable consensus would upset the justified expectations of both the legal and investment communities. Moreover, I am satisfied that the interpretation of the statute expounded by Judge Sprecher and Judge Friendly was entirely correct. As Judge Friendly has observed, the exclusion for short-term notes must be read in light of the prefatory language in 2 of the 1933 Act and 3 of the 1934 Act. See Exchange Nat. Bank of Pursuant to that language, definitions specified by the Acts may not apply if the "context otherwise requires." Marine 455 U.S. 5, ; accord, Landreth Timber *76 The context clause thus permits a judicial construction of the statute which harmonizes the facially rigid terms of the 9-month exclusion with the evident intent of Congress. Exchange Nat. Bank, 544 F. 2d, at 1132-1133. The legislative history of 3(a)(3) of the 1933 Act indicates that the exclusion was intended to cover only commercial paper, and the SEC has so construed it. Sanders, 463 F. 2d, at 1079, and nn. 12-13; Zeller, 476 F. 2d, at 799-, and n. 6. As the Courts of Appeals have agreed, there is no apparent reason to construe 3(a)(10) of the 1934 Act differently. Sanders, 463 F. 2d, at 1079-, and n. 15; Zeller, 476 F. 2d, at See also Comment, The Commercial Paper Market and the Securities Acts, For these reasons and those stated in the opinion of the Court, I conclude that the notes issued by respondents are securities within the meaning of the 1934 Act. CHIEF JUSTICE REHNQUIST, with whom JUSTICE WHITE, JUSTICE O'CONNOR, and JUSTICE SCALIA join, concurring in part and dissenting in part. I join Part II of the Court's opinion, but dissent from Part III and the statements of the Court's judgment in Parts I and IV. In Part III, the Court holds that these notes were not covered by the statutory exemption for "any note which has a maturity at the time of issuance of not exceeding nine months." Treating demand notes as if they were a recent development in the law of negotiable instruments, the Court says "if it is plausible to regard a demand note as having an immediate maturity because demand could be made immediately, it is also plausible to regard the maturity of a demand note as being in excess of nine months because demand could be made many years or decades into the future. Given this ambiguity, the exclusion must be interpreted in accordance with its purpose." Ante, at 72-73. *77 But the terms "note" and "maturity" did not spring full blown from the head of Congress in 1934. Neither are demand notes of recent vintage. "Note" and "maturity" have been terms of art in the legal profession for centuries, and a body of law concerning the characteristics of demand notes, including their maturity, was in existence at the time Congress passed the 1934 Act. In construing any terms whose meanings are less than plain, we depend on the common understanding of those terms at the time of the statute's creation. See ; Roadway Express, ; Standard Oil Co. of New ; see also ; United Contemporaneous editions of legal dictionaries defined "maturity" as "[t]he time when a note becomes due." Black's Law Dictionary 1170 (3d ed. 1933); Cyclopedic Law Dictionary 649 (2d ed. 1922). Pursuant to the dominant consensus in the case law, instruments payable on demand were considered immediately "due" such that an action could be brought at any time without any other demand than the suit. See, e. g., M. Law of Bills, Notes, and Checks 349, p. 265 (3d ed. W. Lile rev. 1928); 8 C. J., Bills and Notes 602, p. 406, and n. 83 (1916). According to : "So far as maker and acceptor are concerned, paper payable. `on demand' is due from the moment of its delivery, and payment may be required on any business day, including the day of its issue, within the statute of limitations. In other words, as to these parties the paper is at maturity all the time, and no demand of payment is necessary *78 before suit thereon." 349, at 265 (emphasis added; emphasis in original deleted; footnote omitted). To be sure, demand instruments were considered to have "the peculiar quality of having two maturity dates one for the purpose of holding to his obligation the party primarily liable (e. g. maker), and the other for enforcing the contracts of parties secondarily liable (e. g. drawer and indorsers)." 350, at 266 (emphasis omitted). But only the rule of immediate maturity respecting makers of demand notes has any bearing on our examination of the exemption; the language in the Act makes clear that it is the "maturity at time of issuance" with which we are concerned. 15 U.S. C. 78c(a)(10). Accordingly, in the absence of some compelling indication to the contrary, the maturity date exemption must encompass demand notes because they possess "maturity at the time of issuance of not exceeding nine months."[*] *79 Petitioners and the lower court decisions cited by JUSTICE STEVENS rely, virtually exclusively, on the legislative history of 3(a)(3) of the 1933 Act for the proposition that the term "any note" in the exemption in 3(a)(10) of the 1934 Act encompass only notes having the character of short-term "commercial paper" exchanged among sophisticated traders. I am not altogether convinced that the legislative history of 3(a)(3) supports that interpretation even with respect to the term "any note" in the exemption in 3(a)(3), and to bodily transpose that legislative history to another statute has little to commend it as a method of statutory construction. The legislative history of the 1934 Act under which this case arises contains nothing which would support a restrictive reading of the exemption in question. Nor does the legislative history of 3(a)(3) of the 1933 Act support the asserted limited construction of the exemption in 3(a)(10) of the 1934 Act. Though the two most pertinent sources of congressional commentary on 3(a)(3) H. R. Rep. No. 85, 73d Cong., 1st Sess., 15 (1933) and S. Rep. No. 47, 73d Cong., 1st Sess., 3-4 (1933) do suggest an intent to limit 3(a)(3)'s exemption to short-term commercial paper, the references in those Reports to commercial paper simply did not survive in the language of the enactment. Indeed, the Senate Report stated "[n]otes, drafts, bills of exchange, and bankers' acceptances which are commercial paper and arise out of current commercial, agricultural, or industrial transactions, and which are not intended to be marketed to the public, are exempted." S. Rep. No. 47, Yet the provision enacted in 3(a)(3) *80 of the 1933 Act exempts "[a]ny note, draft, bill of exchange, or banker's acceptance which arises out of a current transaction or the proceeds of which have been or are to be used for current transactions, and which has a maturity at the time of issuance of not exceeding nine months" 15 U.S. C. 77c(a)(3) Such broadening of the language in the enacted version of 3(a)(3), relative to the prototype from which it sprang, cannot easily be dismissed in interpreting 3(a)(3). A fortiori, the legislative history's restrictive meaning cannot be imputed to the facially broader language in a different provision of another Act. Although I do not doubt that both the 1933 and 1934 Act exemptions encompass short-term commercial paper, the expansive language in the statutory provisions is strong evidence that, in the end, Congress meant for commercial paper merely to be a subset of a larger class of exempted short-term instruments. The plausibility of imputing a restrictive reading to 3(a) (10) from the legislative history of 3(a)(3) is further weakened by the imperfect analogy between the two provisions in terms of both phraseology and nature. Section 3(a)(10) lacks the cryptic phrase in 3(a)(3) which qualifies the class of instruments eligible for exemption as those arising "out of current transaction[s] or the proceeds of which have been or are to be used for current transactions" While that passage somehow may strengthen an argument for limiting the exemption in 3(a)(3) to commercial paper, its absence in 3(a)(10) conversely militates against placing the same limitation thereon. The exemption in 3(a)(3) excepts the short-term instruments it covers solely from the registration requirements of the 1933 Act. The same instruments are not exempted from the 1933 Act's antifraud provisions. Compare 15 U.S. C. 77c(a)(3) with 15 U.S. C. 77l(2) and 77q(c); see also Securities Industry 1 By contrast, the exemption in 3(a)(10) of the 1934 Act exempts instruments encompassed thereunder from the entirety of the coverage of the 1934 Act including, conspicuously, the Act's antifraud provisions. JUSTICE STEVENS argues that the suggested limited reading of the exemption in 3(a)(10) of the 1934 Act "harmonizes" the plain terms of that provision with the legislative history of the 1933 Act. Ante, at 76. In his view, such harmony is required by the "context clause" at the beginning of the 1934 Act's general definition of "security." It seems to me, instead, that harmony is called for primarily between 3(a)(10)'s general definition and its specific exemption. The fairest reading of the exemption in light of the context clause is that the situation described in the exemption notes with maturities at issue of less than nine months is one contextual exception Congress especially wanted courts to recognize. Such a reading does not render the context clause superfluous; it merely leaves it to the judiciary to flesh out additional "context clause" exceptions. JUSTICE STEVENS also states that we have previously referred to the exemption in 3(a)(10) as an exclusion for commercial paper. Ante, at 76 (citing Securities Industry at ). In the Securities Industry dictum, however, we described the exemption in 3(a)(10) merely as "encompass[ing]" commercial paper and in no way concluded that the exemption was limited to commercial paper. See -1. Indeed, in Securities Industry our purpose in referring to 3(a)(10) was to assist our determination whether commercial paper was even included in the 73d Congress' use of the words "notes or other securities" in the Glass-Steagall Banking Act of 1933. In sum, there is no justification for looking beyond the plain terms of 3(a)(10), save for ascertaining the meaning of "maturity" with respect to demand notes. That inquiry reveals *82 that the Co-Op's demand notes come within the purview of the section's exemption for short-term securities. I would therefore affirm the judgment of the Court of Appeals, though on different reasoning. |
per_curiam | per_curiam | true | Adarand Constructors, Inc. v. Slater | 2000-01-12T00:00:00 | null | https://www.courtlistener.com/opinion/1855418/adarand-constructors-inc-v-slater/ | https://www.courtlistener.com/api/rest/v3/clusters/1855418/ | 2,000 | 1999-020 | 2 | 9 | 0 | I Congress has adopted a policy that favors contracting with small businesses owned and controlled by the socially and economically disadvantaged. See § 8(d)(1) of the Small Business Act, as added by § 7 of Pub. L. 87-305, 75 Stat. 667, and as amended, 15 U.S. C. § 637(d)(1) (1994 ed., Supp. IV). To effectuate that policy, the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA), Pub. L. 102-240, § 1003(b), 105 Stat. 1919, which is an appropriations measure for the Department of Transportation (DOT), seeks to direct 10 percent of the contracting funds expended on projects funded in whole or in part by the appropriated funds to transportation projects employing so-called disadvantaged business enterprises.[1] ISTEA § 1003(b)(1).
*218 To qualify for that status, the small business must be certified as owned and controlled by socially and economically disadvantaged individuals. DOT does not itself conduct certifications, but relies on certifications from two main sources: the Small Business Administration, which certifies businesses for all types of federal procurement programs, and state highway agencies, which certify them for purposes of federally assisted highway projects. The federal regulations governing these certification programs, see 13 CFR pt. 124 (1999) (Small Business Administration); 64 Fed. Reg. 5096-5148 (1999) (to be codified in 49 CFR pt. 26) (DOT for state highway agencies), require that the certifying entity presume to be socially disadvantaged persons who are black, Hispanic, Asian Pacific, Subcontinent Asian, Native Americans, or members of other groups designated from time to time by the Small Business Administration. See 13 CFR § 124.103(b); 64 Fed. Reg. 5136 (§ 26.67). State highway agencies must in addition presume that women are socially disadvantaged. Ibid. Small businesses owned and controlled by persons who are not members of the preferred groups may also be certified, but only if they can demonstrate social disadvantage. See 13 CFR § 124.103(c); 64 Fed. Reg. 5136-5137 (§ 26.67(d)); id., at 5147-5148 (pt. 26, subpt. D, App. E). Third parties, as well as DOT, may challenge findings of social disadvantage. See 13 CFR § 124.1017(a); 64 Fed. Reg. 5142 (§ 26.87).
II
In 1989, DOT awarded the prime contract for a federal highway project in Colorado to Mountain Gravel & Construction Company. The contract included a Subcontractor Compensation Clausewhich the Small Business Act requires all *219 federal agencies to include in their prime contracts, see 15 U.S. C. § 637(d)rewarding the prime contractor for subcontracting with disadvantaged business enterprises, see § 637(d)(4)(E). Petitioner, whose principal is a white man, submitted the low bid on a portion of the project, but Mountain Gravel awarded the subcontract to a company that had previously been certified by the Colorado Department of Transportation (CDOT) as a disadvantaged business enterprise.
Petitioner brought suit against various federal officials, alleging that the Subcontractor Compensation Clause, and in particular the race-based presumption that forms its foundation, violated petitioner's Fifth Amendment right to equal protection. The Tenth Circuit, applying the so-called intermediate scrutiny approved in some of our cases involving classifications on a basis other than race, see Mississippi Univ. for Women v. Hogan, 458 U.S. 718 (1982); Craig v. Boren, 429 U.S. 190 (1976), upheld the use of the clause and the presumption. Adarand Constructors, Inc. v. Peña, 16 F.3d 1537 (1994). Because DOT's use of race-based measures should have been subjected to strict scrutiny, we reversed and remanded for the application of that standard. Adarand Constructors, Inc. v. Peña, 515 U.S. 200, 237-239 (1995) (Adarand I).
On remand, the District Court for the District of Colorado held that the clause and the presumption failed strict scrutiny because they were not narrowly tailored. Adarand Constructors, Inc. v. Peña, 965 F. Supp. 1556 (1997) (Adarand II). Specifically, the court held the presumption that members of the enumerated racial groups are socially disadvantaged to be both overinclusive and underinclusive, because it includes members of those groups who are not disadvantaged and excludes members of other groups who are. Id., at 1580. The District Court enjoined DOT from *220 using the clause and its presumption.[2]Id., at 1584. Respondents appealed to the Tenth Circuit.
Shortly thereafter, and while respondents' appeal was still pending, petitioner filed a second suit in the District Court, this time naming as defendants certain Colorado officials, and challenging (on the same grounds) the State's use of the federal guidelines in certifying disadvantaged business enterprises for federally assisted projects. Adarand Constructors, Inc. v. Romer, Civ. No. 97K-1351 (June 26, 1997). Shortly after this suit was filed, however, Colorado altered its certification program in response to the District Court's decision in Adarand II. Specifically, the State did away with the presumption of social disadvantage for certain minorities and women, App. to Pet. for Cert. 109-111, and in its place substituted a requirement that all applicants certify on their own account that each of the firm's majority owners "has experienced social disadvantage based upon the effects of racial, ethnic or gender discrimination," id., at 110. Colorado requires no further showing of social disadvantage by any applicant.
A few days after Colorado amended its certification procedure, the District Court held a hearing on petitioner's motion for a preliminary injunction in Romer. The District Court took judicial notice of its holding in Adarand II that the Federal Government had discriminated against petitioner's owner "by the application of unconstitutional rules and regulations." App. to Pet. for Cert. 136. As a result of that race-based discrimination, the District Court reasoned, petitioner likely was eligible for disadvantaged business status under Colorado's system for certifying businesses for federally assisted projectsthe system at issue in Romer. App. to Pet. for Cert. 137. The District Court therefore denied *221 petitioner's request for a preliminary injunction. Id., at 138. Petitioner then requested and received disadvantaged business status from CDOT.
Meanwhile, respondents' appeal from the District Court's decision in Adarand II was pending before the Tenth Circuit. Upon learning that CDOT had given petitioner disadvantaged business status, the Tenth Circuit held that the cause of action was moot, and vacated the District Court's judgment favorable to petitioner in Adarand II. 169 F.3d 1292, 1296-1297, 1299 (CA10 1999). Petitioner filed a petition for certiorari.
III
In dismissing the case as moot, the Tenth Circuit relied on the language of the Subcontractor Compensation Clause, which provides that "[a] small business concern will be considered a [disadvantaged business enterprise] after it has been certified as such by . . . any State's Department of Highways/Transportation." Id., at 1296. Because CDOT had certified petitioner as a disadvantaged business enterprise, the court reasoned, the language of the clause indicated that the Federal Government also had accepted petitioner's certification for purposes of federal projects. As a result, petitioner could no longer demonstrate "`an invasion of a legally protected interest' that is sufficiently `concrete and particularized' and `actual or imminent' " to establish standing. Arizonans for Official English v. Arizona, 520 U.S. 43, 64 (1997) (quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)). Because, the court continued, petitioner could not demonstrate such an invasion, its cause of action was moot. 169 F. 3d, at 1296-1297.
In so holding, the Tenth Circuit "confused mootness with standing," Friends of Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc., ante, at 189, and as a result placed the burden of proof on the wrong party. If this case is moot, it is because the Federal Government has accepted CDOT's *222 certification of petitioner as a disadvantaged business enterprise, and has thereby ceased its offending conduct. Voluntary cessation of challenged conduct moots a case, however, only if it is "absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur." United States v. Concentrated Phosphate Export Assn., Inc., 393 U.S. 199, 203 (1968) (emphasis added). And the "`heavy burden of persua[ding]' the court that the challenged conduct cannot reasonably be expected to start up again lies with the party asserting mootness. " Friends of Earth, ante, at 189 (emphasis added) (quoting Concentrated Phosphate Export Assn., supra, at 203).
Because respondents cannot satisfy this burden, the Tenth Circuit's error was a crucial one. As common sense would suggest, and as the Tenth Circuit itself recognized, DOT accepts only "valid certification[s]" from state agencies. 169 F. 3d, at 1298. As respondents concede, however, see Brief in Opposition 13-14, n. 6, DOT has yet to approveas it mustCDOT's procedure for certifying disadvantaged business enterprises, see 64 Fed. Reg. 5129 (1999) (49 CFR § 26.21(b)(1)) ("[The State] must submit a [disadvantaged business enterprise] program conforming to this part by August 31, 1999 to the concerned operating administration").
DOT has promulgated regulations outlining the procedure state highway agencies must follow in certifying firms as disadvantaged business enterprises. See 64 Fed. Reg. 5096 5148 (pt. 26). As described earlier, those regulations require the agency to presume that "women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, Subcontinent Asian Americans, or other minorities found to be disadvantaged by the [Small Business Administration]" are socially disadvantaged. Id., at 5136 (§ 26.67(a)(1)). Before individuals not members of those groups may be certified, the state agency must make individual determinations as to disadvantage. See id., at 5136 5137 (§ 26.67(d)) ("In such a proceeding, the applicant firm *223 has the burden of demonstrating to [the state highway agency], by a preponderance of the evidence, that the individuals who own and control it are socially and economically disadvantaged"); id., at 5147-5148 (pt. 26, subpt. D, App. E) (providing list of "elements" that highway agencies must consider in making individualized determinations of social disadvantage). CDOT's new procedure under which petitioner was certified applies no presumption in favor of minority groups, and accepts without investigation a firm's selfcertification of entitlement to disadvantaged business status. See App. to Pet. for Cert. 109-111. Given the material differences (not to say incompatibility) between that procedure and the requirements of the DOT regulations, it is not at all clear that CDOT's certification is a "valid certification," and hence not at all clear that the Subcontractor Compensation Clause requires its acceptance.
Before the Tenth Circuit, respondents took pains to "expres[s] no opinion regarding the correctness of Colorado's determination that [petitioner] is entitled to [disadvantaged business] status." Motion by the Federal Appellants to Dismiss Appeal as Moot and to Vacate the District Court Judgment in No. 97-1304, p. 3, n. 2. Instead, they stated flatly that "in the event there is a third-party challenge to [petitioner's] certification as a [disadvantaged business enterprise] and the decision on the challenge is appealed to DOT, DOT may review the decision to determine whether the certification was proper." Id., at 3-4, n. 2. In addition, DOT itself has the power to require States to initiate proceedings to withdraw a firm's disadvantaged status if there is "reasonable cause to believe" that the firm "does not meet the eligibility criteria" set forth in the federal regulations. 64 Fed. Reg. 5142 (§ 26.87(c)(1)). Given the patent incompatibility of the certification with the federal regulations, it is far from clear that these possibilities will not become reality. Indeed, challenges to petitioner's disadvantaged business status seem quite probable now that the Tenth Circuit, by *224 vacating Adarand II, has eliminated the sole basis for petitioner's certification in the first place.
The Tenth Circuit dismissed these possibilities as insufficiently particular and concrete to grant standing and therefore "too conjectural and speculative to avoid a finding of mootness." 169 F. 3d, at 1298 (internal quotation marks omitted). As we recently noted in Friends of the Earth, however, "[t]he plain lesson of [our precedents] is that there are circumstances in which the prospect that a defendant will engage in (or resume) harmful conduct may be too speculative to support standing, but not too speculative to overcome mootness." Ante, at 190. Because, under the circumstances of this case, it is impossible to conclude that respondents have borne their burden of establishing that it is "absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur," ante, at 189, petitioner's cause of action remains alive.
* * *
It is no small matter to deprive a litigant of the rewards of its efforts, particularly in a case that has been litigated up to this Court and back down again. Such action on grounds of mootness would be justified only if it were absolutely clear that the litigant no longer had any need of the judicial protection that it sought. Because that is not the case here, the petition for writ of certiorari is granted, the judgment of the United States Court of Appeals for the Tenth Circuit is reversed, and the case is remanded for further proceedings consistent with this opinion.
It is so ordered.
| I Congress has adopted a policy that favors contracting with small businesses owned and controlled by the socially and economically disadvantaged. See 8(d)(1) of the Small Business Act, as added by 7 of Stat. 667, and as amended, 15 U.S. C. 637(d)(1) ( ed., Supp. IV). To effectuate that policy, the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA), Pub. L. 102-240, 1003(b), which is an appropriations measure for the Department of Transportation (DOT), seeks to direct 10 percent of the contracting funds expended on projects funded in whole or in part by the appropriated funds to transportation projects employing so-called disadvantaged business enterprises.[1] ISTEA 1003(b)(1). *218 To qualify for that status, the small business must be certified as owned and controlled by socially and economically disadvantaged individuals. DOT does not itself conduct certifications, but relies on certifications from two main sources: the Small Business Administration, which certifies businesses for all types of federal procurement programs, and state highway agencies, which certify them for purposes of federally assisted highway projects. The federal regulations governing these certification programs, see 13 CFR pt. 124 (Small Business Administration); -5148 (to be codified in 49 CFR pt. 26) (DOT for state highway agencies), require that the certifying entity presume to be socially disadvantaged persons who are black, Hispanic, Asian Pacific, Subcontinent Asian, Native Americans, or members of other groups designated from time to time by the Small Business Administration. See 13 CFR 124.103(b); ( 26.67). State highway agencies must in addition presume that women are socially disadvantaged. Small businesses owned and controlled by persons who are not members of the preferred groups may also be certified, but only if they can demonstrate social disadvantage. See 13 CFR 124.103(c); -5137 ( 26.67(d)); Third parties, as well as DOT, may challenge findings of social disadvantage. See 13 CFR 124.1017(a); ( 26.87). II In 1989, DOT awarded the prime contract for a federal highway project in Colorado to Mountain Gravel & Construction Company. The contract included a Subcontractor Compensation Clausewhich the Small Business Act requires all *219 federal agencies to include in their prime contracts, see 15 U.S. C. 637(d)rewarding the prime contractor for subcontracting with disadvantaged business enterprises, see 637(d)(4)(E). Petitioner, whose principal is a white man, submitted the low bid on a portion of the project, but Mountain Gravel awarded the subcontract to a company that had previously been certified by the Colorado Department of Transportation (CDOT) as a disadvantaged business enterprise. Petitioner brought suit against various federal officials, alleging that the Subcontractor Compensation Clause, and in particular the race-based presumption that forms its foundation, violated petitioner's Fifth Amendment right to equal protection. The Tenth Circuit, applying the so-called intermediate scrutiny approved in some of our cases involving classifications on a basis other than race, see Mississippi Univ. for ; upheld the use of the clause and the presumption. Adarand Constructors, Because DOT's use of race-based measures should have been subjected to strict scrutiny, we reversed and remanded for the application of that standard. Adarand Constructors, On remand, the District Court for the District of Colorado held that the clause and the presumption failed strict scrutiny because they were not narrowly tailored. Adarand Constructors, Specifically, the court held the presumption that members of the enumerated racial groups are socially disadvantaged to be both overinclusive and underinclusive, because it includes members of those groups who are not disadvantaged and excludes members of other groups who are. The District Court enjoined DOT from *220 using the clause and its presumption.[2] at 1584. Respondents appealed to the Tenth Circuit. Shortly thereafter, and while respondents' appeal was still pending, petitioner filed a second suit in the District Court, this time naming as defendants certain Colorado officials, and challenging (on the same grounds) the State's use of the federal guidelines in certifying disadvantaged business enterprises for federally assisted projects. Adarand Constructors, Inc. v. Romer, Civ. No. 97K-1351 Shortly after this suit was filed, however, Colorado altered its certification program in response to the District Court's decision in Adarand II. Specifically, the State did away with the presumption of social disadvantage for certain minorities and women, App. to Pet. for Cert. 109-111, and in its place substituted a requirement that all applicants certify on their own account that each of the firm's majority owners "has experienced social disadvantage based upon the effects of racial, ethnic or gender discrimination," Colorado requires no further showing of social disadvantage by any applicant. A few days after Colorado amended its certification procedure, the District Court held a hearing on petitioner's motion for a preliminary injunction in Romer. The District Court took judicial notice of its holding in Adarand II that the Federal Government had discriminated against petitioner's owner "by the application of unconstitutional rules and regulations." App. to Pet. for Cert. 136. As a result of that race-based discrimination, the District Court reasoned, petitioner likely was eligible for disadvantaged business status under Colorado's system for certifying businesses for federally assisted projectsthe system at issue in Romer. App. to Pet. for Cert. 137. The District Court therefore denied *221 petitioner's request for a preliminary injunction. Petitioner then requested and received disadvantaged business status from CDOT. Meanwhile, respondents' appeal from the District Court's decision in Adarand II was pending before the Tenth Circuit. Upon learning that CDOT had given petitioner disadvantaged business status, the Tenth Circuit held that the cause of action was moot, and vacated the District Court's judgment favorable to petitioner in Adarand II. Petitioner filed a petition for certiorari. III In dismissing the case as moot, the Tenth Circuit relied on the language of the Subcontractor Compensation Clause, which provides that "[a] small business concern will be considered a [disadvantaged business enterprise] after it has been certified as such by any State's Department of Highways/Transportation." Because CDOT had certified petitioner as a disadvantaged business enterprise, the court reasoned, the language of the clause indicated that the Federal Government also had accepted petitioner's certification for purposes of federal projects. As a result, petitioner could no longer demonstrate "`an invasion of a legally protected interest' that is sufficiently `concrete and particularized' and `actual or imminent' " to establish standing. Arizonans for Official Because, the court continued, petitioner could not demonstrate such an invasion, its cause of action was 169 F. 3d, -1297. In so holding, the Tenth Circuit "confused mootness with standing," Friends of Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc., ante, at 189, and as a result placed the burden of proof on the wrong party. If this case is moot, it is because the Federal Government has accepted CDOT's *222 certification of petitioner as a disadvantaged business enterprise, and has thereby ceased its offending conduct. Voluntary cessation of challenged conduct moots a case, however, only if it is "absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur." United And the "`heavy burden of persua[ding]' the court that the challenged conduct cannot reasonably be expected to start up again lies with the party asserting mootness. " Friends of Earth, ante, at 189 (quoting Concentrated Phosphate Export at ). Because respondents cannot satisfy this burden, the Tenth Circuit's error was a crucial one. As common sense would suggest, and as the Tenth Circuit itself recognized, DOT accepts only "valid certification[s]" from state As respondents concede, however, see Brief in Opposition 13-14, n. 6, DOT has yet to approveas it mustCDOT's procedure for certifying disadvantaged business enterprises, see Fed. Reg. 5129 (49 CFR 26.21(b)(1)) ("[The State] must submit a [disadvantaged business enterprise] program conforming to this part by August 31, to the concerned operating administration"). DOT has promulgated regulations outlining the procedure state highway agencies must follow in certifying firms as disadvantaged business enterprises. See 5148 (pt. 26). As described earlier, those regulations require the agency to presume that "women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, Subcontinent Asian Americans, or other minorities found to be disadvantaged by the [Small Business Administration]" are socially disadvantaged. at 5136 ( 26.67(a)(1)). Before individuals not members of those groups may be certified, the state agency must make individual determinations as to disadvantage. See at 5136 5137 ( 26.67(d)) ("In such a proceeding, the applicant firm *223 has the burden of demonstrating to [the state highway agency], by a preponderance of the evidence, that the individuals who own and control it are socially and economically disadvantaged"); (providing list of "elements" that highway agencies must consider in making individualized determinations of social disadvantage). CDOT's new procedure under which petitioner was certified applies no presumption in favor of minority groups, and accepts without investigation a firm's selfcertification of entitlement to disadvantaged business status. See App. to Pet. for Cert. 109-111. Given the material differences (not to say incompatibility) between that procedure and the requirements of the DOT regulations, it is not at all clear that CDOT's certification is a "valid certification," and hence not at all clear that the Subcontractor Compensation Clause requires its acceptance. Before the Tenth Circuit, respondents took pains to "expres[s] no opinion regarding the correctness of Colorado's determination that [petitioner] is entitled to [disadvantaged business] status." Motion by the Federal Appellants to Dismiss Appeal as Moot and to Vacate the District Court Judgment in No. 97-1304, p. 3, n. 2. Instead, they stated flatly that "in the event there is a third-party challenge to [petitioner's] certification as a [disadvantaged business enterprise] and the decision on the challenge is appealed to DOT, DOT may review the decision to determine whether the certification was proper." In addition, DOT itself has the power to require States to initiate proceedings to withdraw a firm's disadvantaged status if there is "reasonable cause to believe" that the firm "does not meet the eligibility criteria" set forth in the federal regulations. ( 26.87(c)(1)). Given the patent incompatibility of the certification with the federal regulations, it is far from clear that these possibilities will not become reality. Indeed, challenges to petitioner's disadvantaged business status seem quite probable now that the Tenth Circuit, by *224 vacating Adarand II, has eliminated the sole basis for petitioner's certification in the first place. The Tenth Circuit dismissed these possibilities as insufficiently particular and concrete to grant standing and therefore "too conjectural and speculative to avoid a finding of mootness." As we recently noted in Friends of the Earth, however, "[t]he plain lesson of [our precedents] is that there are circumstances in which the prospect that a defendant will engage in (or resume) harmful conduct may be too speculative to support standing, but not too speculative to overcome mootness." Ante, at 190. Because, under the circumstances of this case, it is impossible to conclude that respondents have borne their burden of establishing that it is "absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur," ante, at 189, petitioner's cause of action remains alive. * * * It is no small matter to deprive a litigant of the rewards of its efforts, particularly in a case that has been litigated up to this Court and back down again. Such action on grounds of mootness would be justified only if it were absolutely clear that the litigant no longer had any need of the judicial protection that it sought. Because that is not the case here, the petition for writ of certiorari is granted, the judgment of the United States Court of Appeals for the Tenth Circuit is reversed, and the case is remanded for further proceedings consistent with this opinion. It is so ordered. |
Justice Thomas | dissenting | false | Northwest Airlines, Inc. v. County of Kent | 1994-01-24T00:00:00 | null | https://www.courtlistener.com/opinion/112927/northwest-airlines-inc-v-county-of-kent/ | https://www.courtlistener.com/api/rest/v3/clusters/112927/ | 1,994 | 1993-020 | 1 | 7 | 1 | Today the Court transforms a statutory prohibition on a narrow class of charges on air travel into a broad mandate for federal regulation and review of virtually all airport fees. I disagree with the Court that the landing fees, rental charges, and carrying charges challenged here fall within the scope of the Anti-Head Tax Act (AHTA or Act), 49 U.S. C. App. § 1513. Unlike the Court, I do not believe that the Act imposes a "reasonableness" requirement on all airport charges and user fees. Instead, the Act merely prohibits fees, taxes, and charges imposed on the bases specified in § 1513(a), and leaves airports free to impose other charges, subject to the restrictions of the dormant Commerce Clause. Because the Act does not apply to the fees at issue in this case, I would remand for consideration of petitioners' Commerce Clause claim. Accordingly, I respectfully dissent.
I
As the Court recognizes, ante, at 362-363, Congress passed the AHTA in response to this Court's decision in *375 Evansville-Vanderburgh Airport Authority Dist. v. Delta Airlines, Inc., 405 U.S. 707 (1972), which upheld against Commerce Clause challenge the imposition of a per capita ("head") tax on air travelers. The Act was designed primarily to deal with the proliferation of local head taxes in the wake of the Evansville decision. Aloha Airlines, Inc. v. Director of Taxation of Haw., 464 U.S. 7, 9, 13 (1983).
Two AHTA provisions are relevant here. Section 1513(a) prohibits state and local governments from imposing "a tax, fee, head charge, or other charge, directly or indirectly, on persons traveling in air commerce or on the carriage of persons traveling in air commerce or on the sale of air transportation or on the gross receipts derived therefrom." Section 1513(b), however, states that "nothing in [the Act]" prohibits the imposition of "taxes other than those enumerated in subsection (a)," including, among other things, property and net income taxes, and that the Act does not prohibit "reasonable rental charges, landing fees, and other service charges" collected from "aircraft operators for the use of airport facilities."
In the Court's view, § 1513(a) prohibits virtually all airport user fees, ante, at 365 ("Landing fees, terminal charges, and other airport user fees of the sort here challenged fit § 1513(a)'s description"), and § 1513(b) "saves" those fees that are "reasonable," ante, at 366, n. 9 ("[U]ser fees are covered by § 1513(a), but may be saved by § 1513(b)"). The Court supports its broad reading of § 1513(a) in part by noting that the section prohibits not only head taxes but also taxes on gross receipts. Ante, at 365 (citing Aloha Airlines, 464 U. S., at 12-13). That, however, merely states the obvious. Section 1513(a) expressly prohibits taxes "on the gross receipts derived" from the sale of air transportation. The mere fact that the Act is not strictly limited to head taxes, which were the Act's primary target, id., at 13, but also encompasses taxes on gross receipts from the sale of air transportation, *376 in no way suggests that the Act should be read to encompass all airport "user fees."
To be sure, the Act's apparently broad ban on any fees, taxes, or charges imposed "directly or indirectly, on persons traveling in air commerce," etc., superficially supports the Court's interpretation. Any cost an airline bears is in some sense an "indirect" charge "on persons traveling in air commerce," because the airline ultimately will pass that cost on to consumers in the form of higher ticket prices. But if § 1513(a) covers all charges indirectly imposed on air travelers, as the Court apparently believes, see ante, at 365, it should logically encompass all taxes imposed on airlines as well, including property taxes, net income taxes, franchise taxes, and sales and use taxes on the sale of goods and services. Yet § 1513(b) instructs that such taxes are not covered by § 1513(a)that they are "taxes other than those enumerated in subsection (a)." (Emphasis added.) Significantly, § 1513(b) is not phrased as an exemption for taxes otherwise within § 1513(a)'s prohibition, but rather as a clarification of the reach of § 1513(a). It makes clear that the language of § 1513(a) defining the prohibition does not extend by its own force to the taxes enumerated in § 1513(b). Under the Court's broad construction of § 1513(a)'s "directly or indirectly" language, however, the two provisions would appear to be in conflict.
Recognizing the significance of § 1513(b)'s treatment of taxes, the Court implicitly acknowledges that § 1513(a) does not cover the taxes listed in § 1513(b). Ante, at 366, n. 9. But the Court can only accomplish this reading by assuming that § 1513(b) treats the "rental charges, landing fees, and other service charges ... for the use of airport facilities" listed in that subsection differently from the enumerated taxes. In this understanding, while as to taxes § 1513(b) merely clarifies the scope of § 1513(a), as to fees it serves the altogether different function of providing an exemption from § 1513(a)'s prohibition. The Court supports this reading on *377 the ground that § 1513(b) does not explicitly describe the fees as distinct from ("other than") the fees prohibited in § 1513(a). That construction requires a rather unlikely reading of § 1513(a), however, because it means that the same language defining the scope of the prohibition in that section inexplicably would have one meaning when applied to fees, and quite a different (and more limited) meaning when applied to taxes. None of the taxes listed in § 1513(b), although borne indirectly by airline passengers, would constitute a "tax, fee, ... or other charge, [levied] directly or indirectly, on persons traveling in air commerce," etc. But a user fee charged to an airline, because it is borne indirectly by airline passengers, would constitute such a "tax, fee, ... or other charge...." Thus, the prohibition in § 1513(a) would not extend to, for example, property taxes, because they are not imposed on one of the bases listed in § 1513(a), but would extend to other fees or charges, regardless of the basis upon which they are imposed.
Adherence to the plain language of § 1513(a) avoids these problems. In my view, when the statute prohibits a tax or charge "on persons traveling in air commerce," "on the carriage of" such persons, "on the sale of air transportation," or "on the gross receipts derived therefrom," it defines the prohibition in terms of the prohibited basis of the tax or charge. That is, § 1513(a) prohibits the levy or collection of a tax or fee "on" certain subjects. A head tax, for example, is a charge "on persons traveling in air commerce" in that it is imposed on a per passenger basis. A landing fee, by contrast, is notrather, it is a charge on an aircraft's landing at an airport, without regard to the number of passengers it carries.[1]
*378 Section 1513(b) confirms that § 1513(a) is concerned with the basis on which the tax or charge is calculated. Property taxes, net income taxes, and franchise taxes are not imposed on one of the bases prohibited in § 1513(a), and as explained above, are not included in § 1513(a). Because the same language in § 1513(a) restricts taxes as well as fees and other charges, it seems logical that the fees referred to in § 1513(b), which also are not generally calculated on the bases listed in § 1513(a), are similarly beyond § 1513(a)'s prohibition.
Section 1513(b)'s reference to "reasonable" charges, then, does not impose a requirement that all airport user fees be "reasonable." Instead, it simply makes clear that state and local governments remain free to impose charges other than those proscribed by § 1513(a). Cf. Aloha Airlines, 464 U. S., at 12, n. 6 ("Section 1513(a) pre-empts a limited number of state taxes, ... [and] [§]1513(b) clarifies Congress' view that the States are still free to impose on airlines and air carriers `taxes other than those enumerated in subsection (a)'"). That is not to say that the term "reasonable" is superfluous. Had the Act made unqualified reference to landing fees and other user fees, it might have been read as an indication of congressional intent to authorize fees or charges that would otherwise be invalid under the dormant Commerce Clause. See Maine v. Taylor, 477 U.S. 131, 139 (1986). An unqualified reference might have also been understood to permit landing fees and other fees calculated on one of the bases prohibited by § 1513(a). See n. 1, supra. By including the term "reasonable," Congress ensured that the Act would not *379 be understood to displace the dormant Commerce Clause or to exempt user fees on aircraft operators per se from § 1513(a). In short, § 1513(b) merely clarifies that fees, taxes, and other charges not encompassed within § 1513(a) may be imposed if consistent with our dormant Commerce Clause jurisprudence.[2]
II
The considerable difficulty the Court has in finding content for the term "reasonable" should signal that Congress did not intend the Act to impose a comprehensive new regulation on airport fees. As the Court admits, the Act itself sets no standards for reasonableness. Ante, at 366. Finding no other source for a definition, the Court uses Evansville as its test of reasonableness, apparently for want of anything better. See ante, at 367-368. The Court seems to recognize that this is not a perfect fit (but "will suffice for the purpose at hand," ante, at 368), and with good reason. Reasonableness was only one of several factors considered in Evansville; nondiscrimination against interstate commerce is a separate concern and is of at least equal importance. See 405 U.S., at 716-717. Moreover, as the Court acknowledges, Congress enacted the Act precisely because it found the result in Evansville "unsatisfactory." Ante, at 368.
Nevertheless, the Court reads the Evansville standard into the statute for no reason other than that the parties invite us to do so and that this Court (after enactment of the AHTA) occasionally has applied Evansville to test reasonableness in other contexts. Ante, at 367-368. That the parties agree on a standard, however, does not mean that it is the correct one. Moreover, it seems somewhat odd to import into the Act the very standard that created the problem Congress ostensibly intended the Act to "correct." Indeed, read as the Court construes it, the Act would fail to prohibit *380 precisely the sort of fees § 1513(a) most clearly forbids. A head tax itself was held to be a "reasonable" user fee in Evansville (assuming, as the Court does, that Evansville applied a "reasonableness" standard). Under the Court's interpretation of the AHTA, there is nothing to prevent an airport from imposing a modest per passenger fee on airlines as a service charge for use of airport facilities.[3] Such a fee would pass muster under Evansville, and therefore would be "saved" by § 1513(b) as a "reasonable" fee, even though it is clearly a charge "on the carriage of persons traveling in air commerce." § 1513(a).[4] It is doubtful that Congress intended the AHTA to prohibit "unreasonable" landing fees, whatever they might be, while permitting "Evansville-reasonable" per capita user fees on aircraft operators. If, as the Court implies, Congress disapproved of the result but not the analysis in Evansville, it seems far more likely that it would have left the Commerce Clause analysis undisturbed while prohibiting head taxes and similar fees. In my view, that is precisely what § 1513 does.
Having applied a construction of "reasonable" that it admits is not compelled by the Act, the Court invites the Secretary of Transportation to devise a different, presumably better, *381 interpretation of the term, to which the Court will defer if it is a permissible construction of the Act.[5]Ante, at 368, n. 14. Given that the Act sets no standards for "reasonableness," ante, at 366, it is difficult to imagine how the Secretary's interpretation could be an impermissible one. Indeed, although the Court seems to assume that the standard would be at least as rigorous as the one it applies here, presumably the Secretary could, in the exercise of his expertise, devise a more permissive standard. Under the Court's analysis, there is no reason to assume that the Evansville standard is a minimum. If the Act imposes the comprehensive regulation of the reasonableness of airport charges that the Court sees, it would certainly constitute a clear expression of Congress' intention to displace the dormant Commerce Clause in this area, see Maine v. Taylor, 477 U. S., at 139, in which case the Secretary would be free to regulate either more or less restrictively than would the dormant Commerce Clause. Cf. Merrion v. Jicarilla Apache Tribe, 455 U.S. 130, 154 (1982). I simply find nothing in the AHTA that gives the Secretary such unbridled discretion to regulate all airport user fees.
III
Because the AHTA does not, in my view, apply to the fees in this case, it does not foreclose petitioners' challenge under the dormant Commerce Clause.[6] The courts below, however, *382 held that the Act, as they interpreted it, precluded that claim. 955 F.2d 1054, 1063-1064 (CA6 1992); No. G88-243 CA (WD Mich., Jan. 19, 1990), App. to Pet. for Cert. 46a. Because the lower courts should be given the opportunity to consider the merits of petitioners' dormant Commerce Clause challenge in the first instance, I would remand.
I therefore respectfully dissent.
| Today the Court transforms a statutory prohibition on a narrow class of charges on air travel into a broad mandate for federal regulation and review of virtually all airport fees. I disagree with the Court that the landing fees, rental charges, and carrying charges challenged here fall within the scope of the Anti-Head Tax Act (AHTA or Act), 49 U.S. C. App. 53. Unlike the Court, I do not believe that the Act imposes a "reasonableness" requirement on all airport charges and user fees. Instead, the Act merely prohibits fees, taxes, and charges imposed on the bases specified in 53(a), and leaves airports free to impose other charges, subject to the restrictions of the dormant Commerce Clause. Because the Act does not apply to the fees at issue in this case, I would remand for consideration of petitioners' Commerce Clause claim. Accordingly, I respectfully dissent. I As the Court recognizes, ante, at 362-363, Congress passed the AHTA in response to this Court's decision in *375 Evansville-Vanderburgh Airport Authority which upheld against Commerce Clause challenge the imposition of a per capita ("head") tax on air travelers. The Act was designed primarily to deal with the proliferation of local head taxes in the wake of the Evansville decision. Aloha Two AHTA provisions are relevant here. Section 53(a) prohibits state and local governments from imposing "a tax, fee, head charge, or other charge, directly or indirectly, on persons traveling in air commerce or on the carriage of persons traveling in air commerce or on the sale of air transportation or on the gross receipts derived therefrom." Section 53(b), however, states that "nothing in [the Act]" prohibits the imposition of "taxes other than those enumerated in subsection (a)," including, among other things, property and net income taxes, and that the Act does not prohibit "reasonable rental charges, landing fees, and other service charges" collected from "aircraft operators for the use of airport facilities." In the Court's view, 53(a) prohibits virtually all airport user fees, ante, at 365 ("Landing fees, terminal charges, and other airport user fees of the sort here challenged fit 53(a)'s description"), and 53(b) "saves" those fees that are "reasonable," ante, at 366, n. 9 ("[U]ser fees are covered by 53(a), but may be saved by 53(b)"). The Court supports its broad reading of 53(a) in part by noting that the section prohibits not only head taxes but also taxes on gross receipts. Ante, at 365 (citing Aloha -3). That, however, merely states the obvious. Section 53(a) expressly prohibits taxes "on the gross receipts derived" from the sale of air transportation. The mere fact that the Act is not strictly limited to head taxes, which were the Act's primary target, but also encompasses taxes on gross receipts from the sale of air transportation, *376 in no way suggests that the Act should be read to encompass all airport "user fees." To be sure, the Act's apparently broad ban on any fees, taxes, or charges imposed "directly or indirectly, on persons traveling in air commerce," etc., superficially supports the Court's interpretation. Any cost an airline bears is in some sense an "indirect" charge "on persons traveling in air commerce," because the airline ultimately will pass that cost on to consumers in the form of higher ticket prices. But if 53(a) covers all charges indirectly imposed on air travelers, as the Court apparently believes, see ante, at 365, it should logically encompass all taxes imposed on airlines as well, including property taxes, net income taxes, franchise taxes, and sales and use taxes on the sale of goods and services. Yet 53(b) instructs that such taxes are not covered by 53(a)that they are "taxes other than those enumerated in subsection (a)." (Emphasis added.) Significantly, 53(b) is not phrased as an exemption for taxes otherwise within 53(a)'s prohibition, but rather as a clarification of the reach of 53(a). It makes clear that the language of 53(a) defining the prohibition does not extend by its own force to the taxes enumerated in 53(b). Under the Court's broad construction of 53(a)'s "directly or indirectly" language, however, the two provisions would appear to be in conflict. Recognizing the significance of 53(b)'s treatment of taxes, the Court implicitly acknowledges that 53(a) does not cover the taxes listed in 53(b). Ante, at 366, n. 9. But the Court can only accomplish this reading by assuming that 53(b) treats the "rental charges, landing fees, and other service charges for the use of airport facilities" listed in that subsection differently from the enumerated taxes. In this understanding, while as to taxes 53(b) merely clarifies the scope of 53(a), as to fees it serves the altogether different function of providing an exemption from 53(a)'s prohibition. The Court supports this reading on *377 the ground that 53(b) does not explicitly describe the fees as distinct from ("other than") the fees prohibited in 53(a). That construction requires a rather unlikely reading of 53(a), however, because it means that the same language defining the scope of the prohibition in that section inexplicably would have one meaning when applied to fees, and quite a different (and more limited) meaning when applied to taxes. None of the taxes listed in 53(b), although borne indirectly by airline passengers, would constitute a "tax, fee, or other charge, [levied] directly or indirectly, on persons traveling in air commerce," etc. But a user fee charged to an airline, because it is borne indirectly by airline passengers, would constitute such a "tax, fee, or other charge." Thus, the prohibition in 53(a) would not extend to, for example, property taxes, because they are not imposed on one of the bases listed in 53(a), but would extend to other fees or charges, regardless of the basis upon which they are imposed. Adherence to the plain language of 53(a) avoids these problems. In my view, when the statute prohibits a tax or charge "on persons traveling in air commerce," "on the carriage of" such persons, "on the sale of air transportation," or "on the gross receipts derived therefrom," it defines the prohibition in terms of the prohibited basis of the tax or charge. That is, 53(a) prohibits the levy or collection of a tax or fee "on" certain subjects. A head tax, for example, is a charge "on persons traveling in air commerce" in that it is imposed on a per passenger basis. A landing fee, by contrast, is notrather, it is a charge on an aircraft's landing at an airport, without regard to the number of passengers it carries.[] *378 Section 53(b) confirms that 53(a) is concerned with the basis on which the tax or charge is calculated. Property taxes, net income taxes, and franchise taxes are not imposed on one of the bases prohibited in 53(a), and as explained above, are not included in 53(a). Because the same language in 53(a) restricts taxes as well as fees and other charges, it seems logical that the fees referred to in 53(b), which also are not generally calculated on the bases listed in 53(a), are similarly beyond 53(a)'s prohibition. Section 53(b)'s reference to "reasonable" charges, then, does not impose a requirement that all airport user fees be "reasonable." Instead, it simply makes clear that state and local governments remain free to impose charges other than those proscribed by 53(a). Cf. Aloha n. 6 pre-empts a limited number of state taxes, [and] []53(b) clarifies Congress' view that the States are still free to impose on airlines and air carriers `taxes other than those enumerated in subsection (a)'"). That is not to say that the term "reasonable" is superfluous. Had the Act made unqualified reference to landing fees and other user fees, it might have been read as an indication of congressional intent to authorize fees or charges that would otherwise be invalid under the dormant Commerce Clause. See An unqualified reference might have also been understood to permit landing fees and other fees calculated on one of the bases prohibited by 53(a). See n. By including the term "reasonable," Congress ensured that the Act would not *379 be understood to displace the dormant Commerce Clause or to exempt user fees on aircraft operators per se from 53(a). In short, 53(b) merely clarifies that fees, taxes, and other charges not encompassed within 53(a) may be imposed if consistent with our dormant Commerce Clause jurisprudence.[2] II The considerable difficulty the Court has in finding content for the term "reasonable" should signal that Congress did not intend the Act to impose a comprehensive new regulation on airport fees. As the Court admits, the Act itself sets no standards for reasonableness. Ante, at 366. Finding no other source for a definition, the Court uses Evansville as its test of reasonableness, apparently for want of anything better. See ante, at 367-368. The Court seems to recognize that this is not a perfect fit (but "will suffice for the purpose at hand," ante, at 368), and with good reason. Reasonableness was only one of several factors considered in Evansville; nondiscrimination against interstate commerce is a separate concern and is of at least equal importance. See 405 U.S., at 76-77. Moreover, as the Court acknowledges, Congress enacted the Act precisely because it found the result in Evansville "unsatisfactory." Ante, at 368. Nevertheless, the Court reads the Evansville standard into the statute for no reason other than that the parties invite us to do so and that this Court (after enactment of the AHTA) occasionally has applied Evansville to test reasonableness in other contexts. Ante, at 367-368. That the parties agree on a standard, however, does not mean that it is the correct one. Moreover, it seems somewhat odd to import into the Act the very standard that created the problem Congress ostensibly intended the Act to "correct." Indeed, read as the Court construes it, the Act would fail to prohibit *380 precisely the sort of fees 53(a) most clearly forbids. A head tax itself was held to be a "reasonable" user fee in Evansville (assuming, as the Court does, that Evansville applied a "reasonableness" standard). Under the Court's interpretation of the AHTA, there is nothing to prevent an airport from imposing a modest per passenger fee on airlines as a service charge for use of airport facilities.[3] Such a fee would pass muster under Evansville, and therefore would be "saved" by 53(b) as a "reasonable" fee, even though it is clearly a charge "on the carriage of persons traveling in air commerce." 53(a).[4] It is doubtful that Congress intended the AHTA to prohibit "unreasonable" landing fees, whatever they might be, while permitting "Evansville-reasonable" per capita user fees on aircraft operators. If, as the Court implies, Congress disapproved of the result but not the analysis in Evansville, it seems far more likely that it would have left the Commerce Clause analysis undisturbed while prohibiting head taxes and similar fees. In my view, that is precisely what 53 does. Having applied a construction of "reasonable" that it admits is not compelled by the Act, the Court invites the Secretary of Transportation to devise a different, presumably better, *38 interpretation of the term, to which the Court will defer if it is a permissible construction of the Act.[5]Ante, at 368, n. 4. Given that the Act sets no standards for "reasonableness," ante, at 366, it is difficult to imagine how the Secretary's interpretation could be an impermissible one. Indeed, although the Court seems to assume that the standard would be at least as rigorous as the one it applies here, presumably the Secretary could, in the exercise of his expertise, devise a more permissive standard. Under the Court's analysis, there is no reason to assume that the Evansville standard is a minimum. If the Act imposes the comprehensive regulation of the reasonableness of airport charges that the Court sees, it would certainly constitute a clear expression of Congress' intention to displace the dormant Commerce Clause in this area, see 477 U. S., 9, in which case the Secretary would be free to regulate either more or less restrictively than would the dormant Commerce Clause. Cf. 455 U.S. 30, 54 (982). I simply find nothing in the AHTA that gives the Secretary such unbridled discretion to regulate all airport user fees. III Because the AHTA does not, in my view, apply to the fees in this case, it does not foreclose petitioners' challenge under the dormant Commerce Clause.[6] The courts below, however, *382 held that the Act, as they interpreted it, precluded that claim. 955 F.2d 054, 063-064 (CA6 992); No. G88-243 CA (WD Mich., Jan. 9, 990), App. to Pet. for Cert. 46a. Because the lower courts should be given the opportunity to consider the merits of petitioners' dormant Commerce Clause challenge in the first instance, I would remand. I therefore respectfully dissent. |
Justice Rehnquist | dissenting | false | Hicks v. Oklahoma | 1980-06-16T00:00:00 | null | https://www.courtlistener.com/opinion/110303/hicks-v-oklahoma/ | https://www.courtlistener.com/api/rest/v3/clusters/110303/ | 1,980 | 1979-118 | 2 | 8 | 1 | The Court concludes that the Oklahoma Court of Criminal Appeals denied petitioner due process of law by refusing to vacate the sentence imposed at his trial for unlawful distribution *348 of heroin. That conclusion, in turn, depends on the Court's assertion that petitioner was impermissibly denied his state-created right to be sentenced by a jury. Because I believe that the Court either mischaracterizes the right conferred by state law or erroneously assumes a deprivation of that right, I dissent.
The Court is undoubtedly correct that Oklahoma law does confer a right to have a sentence imposed by a jury. Okla. Stat., Tit. 22, § 926 (1971). But it is equally true that petitioner was sentenced by a jury. The question is whether that sentence was validly imposed, either as a matter of state or federal law. For if the petitioner was constitutionally sentenced by his jury in the first instance, he has been afforded the process the State guaranteed him. The Oklahoma court found that petitioner was not properly sentenced. If this conclusion rested on an interpretation of state law, or a correct interpretation of federal law, then I would have less difficulty agreeing with the Court that petitioner was entitled to a new jury sentencing under principles of due process. But the Court fails to inquire into the basis of the Oklahoma court's conclusion that petitioner was improperly sentenced in the first instance. That question is central to the resolution of the due process issue presented by the case. The Court simply assumes that the Oklahoma court found that petitioner had not been sentenced in conformity with state law. This is an assumption, however, that cannot be divined from the available state cases. Those cases in fact strongly indicate that the decision of the state court here rested on an erroneous interpretation of federal law, not state law. If so, the Oklahoma court decision refusing to afford petitioner an opportunity to be resentenced by a jury would be correct, albeit for the wrong reason.
The issue in this case, then, is whether petitioner's original sentence denied him equal protection. The Oklahoma sentencing statute in effect at the time of petitioner's trial was designed to provide for increased sentences to multiple offenders *349 of the criminal laws.[*] Under Okla. Stat., Tit. 21, § 51 (A) (Supp. 1977) a defendant who is found guilty of an offense punishable by a term of imprisonment in excess of 5 years, after having been convicted of one offense punishable by imprisonment, is subject to sentence, fixed by the jury, ranging from 10 years to apparent infinity. (Oklahoma juries have apparently exercised this discretion with great relish, imposing sentences as long as 1,500 years in prison for second-time offenders. See Callins v. State, 500 P.2d 1333 (Crim. App. 1972).) Defendants convicted of more than one *350 prior offense were subject to sentencing under § 51 (B). Section 51 (B) did not invest the jury with discretion to determine the length of the term of imprisonment. Instead the section provided a formula for determining the length of the mandatory sentence to be imposed by a jury pursuant to instruction. This statutory scheme permitted the jury to impose sentence on defendants with only one prior conviction far in excess of those which were specified for defendants with two or more prior convictions. In Thigpen v. State, 571 P.2d 467 (Okla. Crim. App. 1977), decided after petitioner's mandatory sentence was imposed by the jury, a defendant with only one prior conviction challenged the constitutionality of the statute. The court concluded that this potential for disparate sentences rendered § 51 (B) "unconstitutional," and struck that section.
The Thigpen opinion does not indicate whether this conclusion is based on an interpretation of the State or Federal Constitution. The opinion does indicate, however, that in determining the constitutionality of the Act, the court had relied on an advisory opinion submitted by an Oklahoma state district judge. 571 P.2d, at 471, n. 3. That advisory opinion is attached as an appendix to the court opinion. The position advocated in the advisory opinion is that the Oklahoma sentencing statute violated the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution because of the potential for longer terms of imprisonment to those convicted of only one prior offense. The author of the advisory opinion relies exclusively on federal law in reaching this determination.
In this case, the Oklahoma court thought the federal equal protection holding in Thigpen applied to petitioner's sentencing as well. I cannot agree. Petitioner was a third-time offender who was given the benefit of the more lenient mandatory sentencing provisions before the decision in Thigpen. Thus he was not within the class of one-time offenders subject to more burdensome treatment under the statute. Since *351 petitioner was a member of the favored class, I cannot agree that petitioner's sentencing denied him equal protection or any other rights guaranteed under the Federal Constitution, I am unable to agree that due process required the State to afford him any additional opportunity to be sentenced by another jury, and would therefore affirm the judgment of the Court of Criminal Appeals of Oklahoma.
| The Court concludes that the Oklahoma Court of Criminal Appeals denied petitioner due process of law by refusing to vacate the sentence imposed at his trial for unlawful distribution *348 of heroin. That conclusion, in turn, depends on the Court's assertion that petitioner was impermissibly denied his state-created right to be sentenced by a jury. Because I believe that the Court either mischaracterizes the right conferred by state law or erroneously assumes a deprivation of that right, I dissent. The Court is undoubtedly correct that Oklahoma law does confer a right to have a sentence imposed by a jury. Okla. Stat., Tit. 22, 926 (1971). But it is equally true that petitioner was sentenced by a jury. The question is whether that sentence was validly imposed, either as a matter of state or federal law. For if the petitioner was constitutionally sentenced by his jury in the first instance, he has been afforded the process the State guaranteed him. The Oklahoma court found that petitioner was not properly sentenced. If this conclusion rested on an interpretation of state law, or a correct interpretation of federal law, then I would have less difficulty agreeing with the Court that petitioner was entitled to a new jury sentencing under principles of due process. But the Court fails to inquire into the basis of the Oklahoma court's conclusion that petitioner was improperly sentenced in the first instance. That question is central to the resolution of the due process issue presented by the case. The Court simply assumes that the Oklahoma court found that petitioner had not been sentenced in conformity with state law. This is an assumption, however, that cannot be divined from the available state cases. Those cases in fact strongly indicate that the decision of the state court here rested on an erroneous interpretation of federal law, not state law. If so, the Oklahoma court decision refusing to afford petitioner an opportunity to be resentenced by a jury would be correct, albeit for the wrong reason. The issue in this case, then, is whether petitioner's original sentence denied him equal protection. The Oklahoma sentencing statute in effect at the time of petitioner's trial was designed to provide for increased sentences to multiple offenders *349 of the criminal laws.[*] Under Okla. Stat., Tit. 21, 51 (A) a defendant who is found guilty of an offense punishable by a term of imprisonment in excess of 5 years, after having been convicted of one offense punishable by imprisonment, is subject to sentence, fixed by the jury, ranging from 10 years to apparent infinity.) Defendants convicted of more than one *350 prior offense were subject to sentencing under 51 (B). Section 51 (B) did not invest the jury with discretion to determine the length of the term of imprisonment. Instead the section provided a formula for determining the length of the mandatory sentence to be imposed by a jury pursuant to instruction. This statutory scheme permitted the jury to impose sentence on defendants with only one prior conviction far in excess of those which were specified for defendants with two or more prior convictions. In decided after petitioner's mandatory sentence was imposed by the jury, a defendant with only one prior conviction challenged the constitutionality of the statute. The court concluded that this potential for disparate sentences rendered 51 (B) "unconstitutional," and struck that section. The Thigpen opinion does not indicate whether this conclusion is based on an interpretation of the State or Federal Constitution. The opinion does indicate, however, that in determining the constitutionality of the Act, the court had relied on an advisory opinion submitted by an Oklahoma state district n. 3. That advisory opinion is attached as an appendix to the court opinion. The position advocated in the advisory opinion is that the Oklahoma sentencing statute violated the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution because of the potential for longer terms of imprisonment to those convicted of only one prior offense. The author of the advisory opinion relies exclusively on federal law in reaching this determination. In this case, the Oklahoma court thought the federal equal protection holding in Thigpen applied to petitioner's sentencing as well. I cannot agree. Petitioner was a third-time offender who was given the benefit of the more lenient mandatory sentencing provisions before the decision in Thigpen. Thus he was not within the class of one-time offenders subject to more burdensome treatment under the statute. Since *351 petitioner was a member of the favored class, I cannot agree that petitioner's sentencing denied him equal protection or any other rights guaranteed under the Federal Constitution, I am unable to agree that due process required the State to afford him any additional opportunity to be sentenced by another jury, and would therefore affirm the judgment of the Court of Criminal Appeals of Oklahoma. |
Justice Ginsburg | dissenting | false | Republic of Argentina v. NML Capital, Ltd. | 2014-06-16T00:00:00 | null | https://www.courtlistener.com/opinion/2679202/republic-of-argentina-v-nml-capital-ltd/ | https://www.courtlistener.com/api/rest/v3/clusters/2679202/ | 2,014 | 2013-059 | 2 | 7 | 1 | The Foreign Sovereign Immunities Act of 1976, 28
U.S. C. §§1330, 1602 et seq., if one of several conditions is
met, permits execution of a judgment rendered in the
United States against a foreign sovereign only on “property
in the United States . . . used for a commercial activity.”
§1610(a). Accordingly, no inquiry into a foreign sover-
eign’s property in the United States that is not “used for a
commercial activity” could be ordered; such an inquiry,
as the Court recognizes, would not be “ ‘relevant’ to execu-
tion in the first place.” Ante, at 10 (citing Fed. Rule Civ.
Proc. 26(b)(1)). Yet the Court permits unlimited inquiry
into Argentina’s property outside the United States,
whether or not the property is “used for a commercial
activity.” By what authorization does a court in the United
States become a “clearinghouse for information,” ante,
at 3 (internal quotation marks omitted), about any and all
property held by Argentina abroad? NML may seek such
information, the Court reasons, because “NML does not yet
know what property Argentina has [outside the United
States], let alone whether it is executable under the rele-
vant jurisdiction’s law.” Ante, at 10. But see Société
Nationale Industrielle Aérospatiale v. United States Dist.
Court for Southern Dist. of Iowa, 482 U.S. 522, 542 (1987)
(observing that other jurisdictions generally allow much
2 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
GINSBURG, J., dissenting
more limited discovery than is available in the United
States).
A court in the United States has no warrant to indulge
the assumption that, outside our country, the sky may be
the limit for attaching a foreign sovereign’s property in
order to execute a U. S. judgment against the foreign
sovereign. Cf. §1602 (“Under international law, . . . th[e]
commercial property [of a state] may be levied upon for the
satisfaction of judgments rendered against [the state] in
connection with [its] commercial activities.” (emphasis
added)). Without proof of any kind that other nations
broadly expose a foreign sovereign’s property to arrest,
attachment or execution, a more modest assumption is in
order. See EM Ltd. v. Republic of Argentina, 695 F.3d
201, 207 (CA2 2012) (recognizing that postjudgment dis-
covery “must be calculated to assist in collecting on a
judgment” (citing Fed. Rules Civ. Proc. 26(b)(1), 69(a)(2))).
Unless and until the judgment debtor, here, NML,
proves that other nations would allow unconstrained
access to Argentina’s assets, I would be guided by the one
law we know for sure—our own. That guide is all the
more appropriate, as our law coincides with the interna-
tional norm. See §1602. Accordingly, I would limit NML’s
discovery to property used here or abroad “in connection
with . . . commercial activities.” §§1602, 1610(a). I there-
fore dissent from the sweeping examination of Argentina’s
worldwide assets the Court exorbitantly approves today | The Foreign Sovereign Immunities Act of 1976, 28 U.S. C. 1602 et seq., if one of several conditions is met, permits execution of a judgment rendered in the United States against a foreign sovereign only on “property in the United States used for a commercial activity.” Accordingly, no inquiry into a foreign sover- eign’s property in the United States that is not “used for a commercial activity” could be ordered; such an inquiry, as the Court recognizes, would not be “ ‘relevant’ to execu- tion in the first place.” Ante, at 10 (citing Fed. Rule Civ. Proc. 26(b)(1)). Yet the Court permits unlimited inquiry into Argentina’s property outside the United States, whether or not the property is “used for a commercial activity.” By what authorization does a court in the United States become a “clearinghouse for information,” ante, at 3 (internal quotation marks omitted), about any and all property held by Argentina abroad? NML may seek such information, the Court reasons, because “NML does not yet know what property Argentina has [outside the United States], let alone whether it is executable under the rele- vant jurisdiction’s law.” Ante, at 10. But see Société Nationale Industrielle (observing that other jurisdictions generally allow much 2 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD. GINSBURG, J., dissenting more limited discovery than is available in the United States). A court in the United States has no warrant to indulge the assumption that, outside our country, the sky may be the limit for attaching a foreign sovereign’s property in order to execute a U. S. judgment against the foreign sovereign. Cf. (“Under international law, th[e] commercial property [of a state] may be levied upon for the satisfaction of judgments rendered against [the state] in connection with [its] commercial activities.” (emphasis added)). Without proof of any kind that other nations broadly expose a foreign sovereign’s property to arrest, attachment or execution, a more modest assumption is in order. See EM Ltd. v. Republic of Argentina, 695 F.3d 201, 207 (CA2 2012) (recognizing that postjudgment dis- covery “must be calculated to assist in collecting on a judgment” (citing Fed. Rules Civ. Proc. 26(b)(1), 69(a)(2))). Unless and until the judgment debtor, here, NML, proves that other nations would allow unconstrained access to Argentina’s assets, I would be guided by the one law we know for sure—our own. That guide is all the more appropriate, as our law coincides with the interna- tional norm. See Accordingly, I would limit NML’s discovery to property used here or abroad “in connection with commercial activities.” §, 1610(a). I there- fore dissent from the sweeping examination of Argentina’s worldwide assets the Court exorbitantly approves today |
Justice Blackmun | second_dissenting | true | Furman v. Georgia | 1972-06-29T00:00:00 | null | https://www.courtlistener.com/opinion/108605/furman-v-georgia/ | https://www.courtlistener.com/api/rest/v3/clusters/108605/ | 1,972 | 1971-170 | 2 | 5 | 4 | I join the respective opinions of THE CHIEF JUSTICE, MR. JUSTICE POWELL, and MR. JUSTICE REHNQUIST, and add only the following, somewhat personal, comments.
1. Cases such as these provide for me an excruciating agony of the spirit. I yield to no one in the depth of my distaste, antipathy, and, indeed, abhorrence, for the death penalty, with all its aspects of physical distress and fear and of moral judgment exercised by finite minds. That distaste is buttressed by a belief that capital punishment serves no useful purpose that can be demonstrated. For me, it violates childhood's training and life's experiences, and is not compatible *406 with the philosophical convictions I have been able to develop. It is antagonistic to any sense of "reverence for life." Were I a legislator, I would vote against the death penalty for the policy reasons argued by counsel for the respective petitioners and expressed and adopted in the several opinions filed by the Justices who vote to reverse these judgments.
2. Having lived for many years in a State that does not have the death penalty,[1] that effectively abolished it in 1911,[2] and that carried out its last execution on February 13, 1906,[3] capital punishment had never been a part of life for me. In my State, it just did not exist. So far as I can determine, the State, purely from a statistical deterrence point of view, was neither the worse nor the better for its abolition, for, as the concurring opinions observe, the statistics prove little, if anything. But the State and its citizens accepted the fact that the death penalty was not to be in the arsenal of possible punishments for any crime.
3. I, perhaps alone among the present members of the Court, am on judicial record as to this. As a member of the United States Court of Appeals, I first struggled silently with the issue of capital punishment in Feguer v. United States, 302 F.2d 214 (CA8 1962), cert. denied, 371 U.S. 872 (1962). The defendant in that case may have been one of the last to be executed under federal auspices. I struggled again with the issue, and once more refrained from comment, in my writing for an en banc court in Pope v. United States, 372 F.2d 710 (CA8 1967), vacated (upon acknowledgment by the Solicitor General of error revealed by the subsequently decided United States, v. Jackson, 390 U.S. 570 (1968)) and remanded, 392 U.S. 651 (1968). Finally, in Maxwell *407 v. Bishop, 398 F.2d 138 (CA8 1968), vacated and remanded, sua sponte, by the Court on grounds not raised below, 398 U.S. 262 (1970), I revealed, solitarily and not for the panel, my distress and concern. 398 F.2d, at 153-154.[4] And in Jackson v. Bishop, 404 F.2d 571 (CA8 1968), I had no hesitancy in writing a panel opinion that held the use of the strap by trusties upon fellow Arkansas prisoners to be a violation of the Eighth Amendment. That, however, was in-prison punishment imposed by inmate-foremen.
4. The several concurring opinions acknowledge, as they must, that until today capital punishment was accepted and assumed as not unconstitutional per se under the Eighth Amendment or the Fourteenth Amendment. This is either the flat or the implicit holding of a unanimous Court in Wilkerson v. Utah, 99 U.S. 130, 134-135, in 1879; of a unanimous Court in In re Kemmler, 136 U.S. 436, 447, in 1890; of the Court in Weems v. United States, 217 U.S. 349, in 1910; of all those members of the Court, a majority, who addressed the issue in Louisiana ex rel. Francis v. Resweber, 329 U.S. 459, 463-464, 471-472, in 1947; of Mr. Chief Justice Warren, speaking for himself and three others (Justices Black, DOUGLAS, *408 and Whittaker) in Trop v. Dulles, 356 U.S. 86, 99, in 1958;[5] in the denial of certiorari in Rudolph v. Alabama, 375 U.S. 889, in 1963 (where, however, JUSTICES DOUGLAS, BRENNAN, and Goldberg would have heard argument with respect to the imposition of the ultimate penalty on a convicted rapist who had "neither taken nor endangered human life"); and of Mr. Justice Black in McGautha v. California, 402 U.S. 183, 226, decided only last Term on May 3, 1971.[6]
Suddenly, however, the course of decision is now the opposite way, with the Court evidently persuaded that somehow the passage of time has taken us to a place of greater maturity and outlook. The argument, plausible and high-sounding as it may be, is not persuasive, for it is only one year since McGautha, only eight and one-half years since Rudolph, 14 years since Trop, and 25 years since Francis, and we have been presented with nothing that demonstrates a significant movement of any kind in these brief periods. The Court has just decided that it is time to strike down the death penalty. There would have been as much reason to do this *409 when any of the cited cases were decided. But the Court refrained from that action on each of those occasions.
The Court has recognized, and I certainly subscribe to the proposition, that the Cruel and Unusual Punishments Clause "may acquire meaning as public opinion becomes enlightened by a humane justice." Weems v. United States, 217 U. S., at 378. And Mr. Chief Justice Warren, for a plurality of the Court, referred to "the evolving standards of decency that mark the progress of a maturing society." Trop v. Dulles, 356 U. S., at 101. Mr. Jefferson expressed the same thought well.[7]
*410 My problem, however, as I have indicated, is the suddenness of the Court's perception of progress in the human attitude since decisions of only a short while ago.
5. To reverse the judgments in these cases is, of course, the easy choice. It is easier to strike the balance in favor of life and against death. It is comforting to relax in the thoughtsperhaps the rationalizations that this is the compassionate decision for a maturing society; that this is the moral and the "right" thing to do; that thereby we convince ourselves that we are moving down the road toward human decency; that we value life even though that life has taken another or others or has grievously scarred another or others and their families; and that we are less barbaric than we were in 1879, or in 1890, or in 1910, or in 1947, or in 1958, or in 1963, or a year ago, in 1971, when Wilkerson, Kemmler, Weems, Francis, Trop, Rudolph, and McGautha were respectively decided.
This, for me, is good argument, and it makes some sense. But it is good argument and it makes sense only in a legislative and executive way and not as a judicial expedient. As I have said above, were I a legislator, I would do all I could to sponsor and to vote for legislation abolishing the death penalty. And were I the chief executive of a sovereign State, I would be sorely tempted to exercise executive clemency as Governor Rockefeller of Arkansas did recently just before he departed from office. Thereon the Legislative Branch of the State or Federal Government, and secondarily, on the Executive Branchis where the authority and responsibility for this kind of action lies. The authority should not be taken over by the judiciary in the modern guise of an Eighth Amendment issue.
I do not sit on these cases, however, as a legislator, responsive, at least in part, to the will of constituents. *411 Our task here, as must so frequently be emphasized and re-emphasized, is to pass upon the constitutionality of legislation that has been enacted and that is challenged. This is the sole task for judges. We should not allow our personal preferences as to the wisdom of legislative and congressional action, or our distaste for such action, to guide our judicial decision in cases such as these. The temptations to cross that policy line are very great. In fact, as today's decision reveals, they are almost irresistible.
6. The Court, in my view, is somewhat propelled toward its result by the interim decision of the California Supreme Court, with one justice dissenting, that the death penalty is violative of that State's constitution. People v. Anderson, 6 Cal. 3d 628, 493 P.2d 880 (Feb. 18, 1972). So far as I am aware, that was the first time the death penalty in its entirety has been nullified by judicial decision. Cf. Ralph v. Warden, 438 F.2d 786, 793 (CA4 1970), cert. denied, post, p. 942. California's moral problem was a profound one, for more prisoners were on death row there than in any other State. California, of course, has the right to construe its constitution as it will. Its construction, however, is hardly a precedent for federal adjudication.
7. I trust the Court fully appreciates what it is doing when it decides these cases the way it does today. Not only are the capital punishment laws of 39 States and the District of Columbia struck down, but also all those provisions of the federal statutory structure that permit the death penalty apparently are voided. No longer is capital punishment possible, I suspect, for, among other crimes, treason, 18 U.S. C. § 2381; or assassination of the President, the Vice President, or those who stand elected to those positions, 18 U.S. C. § 1751; or assassination of a Member or member-elect of Congress, 18 U.S. C. § 351; or espionage, 18 U.S. C. § 794; *412 or rape within the special maritime jurisdiction, 18 U.S. C. § 2031; or aircraft or motor vehicle destruction where death occurs, 18 U.S. C. § 34; or explosives offenses where death results, 18 U.S. C. §§ 844 (d) and (f); or train wrecking, 18 U.S. C. § 1992; or aircraft piracy, 49 U.S. C. § 1472 (i). Also in jeopardy, perhaps, are the death penalty provisions in various Articles of the Uniform Code of Military Justice. 10 U.S. C. §§ 885, 890, 894, 899, 901, 904, 906, 913, 918, and 920. All these seem now to be discarded without a passing reference to the reasons, or the circumstances, that prompted their enactment, some very recent, and their retention in the face of efforts to repeal them.
8. It is of passing interest to note a few voting facts with respect to recent federal death penalty legislation:
A. The aircraft piracy statute, 49 U.S. C. § 1472 (i), was enacted September 5, 1961. The Senate vote on August 10 was 92-0. It was announced that Senators Chavez, Fulbright, Neuberger, and Symington were absent but that, if present, all four would vote yea. It was also announced, on the other side of the aisle, that Senator Butler was ill and that Senators Beall, Carlson, and Morton were absent or detained, but that those four, if present, would vote in the affirmative. These announcements, therefore, indicate that the true vote was 100-0. 107 Cong. Rec. 15440. The House passed the bill without recorded vote. 107 Cong. Rec. 16849.
B. The presidential assassination statute, 18 U.S. C. § 1751, was approved August 28, 1965, without recorded votes. 111 Cong. Rec. 14103, 18026, and 20239.
C. The Omnibus Crime Control Act of 1970 was approved January 2, 1971. Title IV thereof added the congressional assassination statute that is now 18 U.S. C. § 351. The recorded House vote on October 7, 1970, was 341-26, with 63 not voting and 62 of those paired. 116 Cong. Rec. 35363-35364. The Senate vote on October 8 *413 was 59-0, with 41 not voting, but with 21 of these announced as favoring the bill. 116 Cong. Rec. 35743. Final votes after conference were not recorded. 116 Cong. Rec. 42150, 42199.
It is impossible for me to believe that the many lawyer-members of the House and Senateincluding, I might add, outstanding leaders and prominent candidates for higher officewere callously unaware and insensitive of constitutional overtones in legislation of this type. The answer, of course, is that in 1961, in 1965, and in 1970 these elected representatives of the peoplefar more conscious of the temper of the times, of the maturing of society, and of the contemporary demands for man's dignity, than are we who sit cloistered on this Court took it as settled that the death penalty then, as it always had been, was not in itself unconstitutional. Some of those Members of Congress, I suspect, will be surprised at this Court's giant stride today.
9. If the reservations expressed by my Brother STEWART (which, as I read his opinion, my Brother WHITE shares) were to command support, namely, that capital punishment may not be unconstitutional so long as it be mandatorily imposed, the result, I fear, will be that statutes struck down today will be re-enacted by state legislatures to prescribe the death penalty for specified crimes without any alternative for the imposition of a lesser punishment in the discretion of the judge or jury, as the case may be. This approach, it seems to me, encourages legislation that is regressive and of an antique mold, for it eliminates the element of mercy in the imposition of punishment. I thought we had passed beyond that point in our criminology long ago.
10. It is not without interest, also, to note that, although the several concurring opinions acknowledge the heinous and atrocious character of the offenses committed by the petitioners, none of those opinions makes *414 reference to the misery the petitioners' crimes occasioned to the victims, to the families of the victims, and to the communities where the offenses took place. The arguments for the respective petitioners, particularly the oral arguments, were similarly and curiously devoid of reference to the victims. There is risk, of course, in a comment such as this, for it opens one to the charge of emphasizing the retributive. But see Williams v. New York, 337 U.S. 241, 248 (1949). Nevertheless, these cases are here because offenses to innocent victims were perpetrated. This fact, and the terror that occasioned it, and the fear that stalks the streets of many of our cities today perhaps deserve not to be entirely overlooked. Let us hope that, with the Court's decision, the terror imposed will be forgotten by those upon whom it was visited, and that our society will reap the hoped-for benefits of magnanimity.
Although personally I may rejoice at the Court's result, I find it difficult to accept or to justify as a matter of history, of law, or of constitutional pronouncement. I fear the Court has overstepped. It has sought and has achieved an end.
MR. JUSTICE POWELL, with whom THE CHIEF JUSTICE, MR. JUSTICE BLACKMUN, and MR. JUSTICE REHNQUIST join, dissenting.
The Court granted certiorari in these cases to consider whether the death penalty is any longer a permissible form of punishment. 403 U.S. 952 (1971). It is the judgment of five Justices that the death penalty, as customarily prescribed and implemented in this country today, offends the constitutional prohibition against cruel and unusual punishments. The reasons for that judgment are stated in five separate opinions, expressing as many separate rationales. In my view, none of these opinions provides a constitutionally adequate foundation for the Court's decision.
*415 MR. JUSTICE DOUGLAS concludes that capital punishment is incompatible with notions of "equal protection" that he finds to be "implicit" in the Eighth Amendment. Ante, at 257. MR. JUSTICE BRENNAN bases his judgment primarily on the thesis that the penalty "does not comport with human dignity." Ante, at 270. MR. JUSTICE STEWART concludes that the penalty is applied in a "wanton" and "freakish" manner. Ante, at 310. For MR. JUSTICE WHITE it is the "infrequency" with which the penalty is imposed that renders its use unconstitutional. Ante, at 313. MR. JUSTICE MARSHALL finds that capital punishment is an impermissible form of punishment because it is "morally unacceptable" and "excessive." Ante, at 360, 358.
Although the central theme of petitioners' presentations in these cases is that the imposition of the death penalty is per se unconstitutional, only two of today's opinions explicitly conclude that so sweeping a determination is mandated by the Constitution. Both MR. JUSTICE BRENNAN and MR. JUSTICE MARSHALL call for the abolition of all existing state and federal capital punishment statutes. They intimate as well that no capital statute could be devised in the future that might comport with the Eighth Amendment. While the practical consequences of the other three opinions are less certain, they at least do not purport to render impermissible every possible statutory scheme for the use of capital punishment that legislatures might hereafter devise.[1] Insofar as these latter opinions fail, at least explicitly, *416 to go as far as petitioners' contentions would carry them, their reservations are attributable to a willingness to accept only a portion of petitioners' thesis. For the reasons cogently set out in the CHIEF JUSTICE'S dissenting opinion (ante, at 396-403), and for reasons stated elsewhere in this opinion, I find my Brothers' less-than-absolute-abolition judgments unpersuasive. Because those judgments are, for me, not dispositive, I shall focus primarily on the broader ground upon which the petitions in these cases are premised. The foundations of my disagreement with that broader thesis are equally applicable to each of the concurring opinions. I will therefore, not endeavor to treat each one separately. Nor will I attempt to predict what forms of capital statutes, if any, may avoid condemnation in the future under the variety of views expressed by the collective majority today. That difficult task, not performed in any of the controlling opinions, must go unanswered until other cases presenting these more limited inquiries arise.
Whatever uncertainties may hereafter surface, several of the consequences of today's decision are unmistakably clear. The decision is plainly one of the greatest importance. *417 The Court's judgment removes the death sentences previously imposed on some 600 persons awaiting punishment in state and federal prisons throughout the country. At least for the present, it also bars the States and the Federal Government from seeking sentences of death for defendants awaiting trial on charges for which capital punishment was heretofore a potential alternative. The happy event for these countable few constitutes, however, only the most visible consequence of this decision. Less measurable, but certainly of no less significance, is the shattering effect this collection of views has on the root principles of stare decisis, federalism, judicial restraint andmost importantly separation of powers.
The Court rejects as not decisive the clearest evidence that the Framers of the Constitution and the authors of the Fourteenth Amendment believed that those documents posed no barrier to the death penalty. The Court also brushes aside an unbroken line of precedent reaffirming the heretofore virtually unquestioned constitutionality of capital punishment. Because of the pervasiveness of the constitutional ruling sought by petitioners, and accepted in varying degrees by five members of the Court, today's departure from established precedent invalidates a staggering number of state and federal laws. The capital punishment laws of no less than 39 States[2] and the District of Columbia are nullified. In addition, numerous provisions of the Criminal Code of the United States and of the Uniform Code of Military *418 Justice also are voided. The Court's judgment not only wipes out laws presently in existence, but denies to Congress and to the legislatures of the 50 States the power to adopt new policies contrary to the policy selected by the Court. Indeed, it is the view of two of my Brothers that the people of each State must be denied the prerogative to amend their constitutions to provide for capital punishment even selectively for the most heinous crime.
In terms of the constitutional role of this Court, the impact of the majority's ruling is all the greater because the decision encroaches upon an area squarely within the historic prerogative of the legislative branchboth state and federalto protect the citizenry through the designation of penalties for prohibitable conduct. It is the very sort of judgment that the legislative branch is competent to make and for which the judiciary is ill-equipped. Throughout our history, Justices of this Court have emphasized the gravity of decisions invalidating legislative judgments, admonishing the nine men who sit on this bench of the duty of self-restraint, especially when called upon to apply the expansive due process and cruel and unusual punishment rubrics. I can recall no case in which, in the name of deciding constitutional questions, this Court has subordinated national and local democratic processes to such an extent. Before turning to address the thesis of petitioners' case against capital punishmenta thesis that has proved, at least in large measure, persuasive to a majority of this Court I first will set out the principles that counsel against the Court's sweeping decision.
I
The Constitution itself poses the first obstacle to petitioners' argument that capital punishment is per se unconstitutional. The relevant provisions are the Fifth, *419 Eighth, and Fourteenth Amendments. The first of these provides in part:
"No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury . . . ; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; . . . nor be deprived of life, liberty, or property, without due process of law . . . ."
Thus, the Federal Government's power was restricted in order to guarantee those charged with crimes that the prosecution would have only a single opportunity to seek imposition of the death penalty and that the death penalty could not be exacted without due process and a grand jury indictment. The Fourteenth Amendment, adopted about 77 years after the Bill of Rights, imposed the due process limitation of the Fifth Amendment upon the States' power to authorize capital punishment.
The Eighth Amendment, adopted at the same time as the Fifth, proscribes "cruel and unusual" punishments. In an effort to discern its meaning, much has been written about its history in the opinions of this Court and elsewhere.[3] That history need not be restated here since, whatever punishments the Framers of the Constitution may have intended to prohibit under the "cruel and unusual" language, there cannot be the slightest doubt that they intended no absolute bar on the Government's authority to impose the death penalty. McGautha v. *420 California, 402 U.S. 183, 226 (1971) (separate opinion of Black, J.). As much is made clear by the three references to capital punishment in the Fifth Amendment. Indeed, the same body that proposed the Eighth Amendment also provided, in the first Crimes Act of 1790, for the death penalty for a number of offenses. 1 Stat. 112.
Of course, the specific prohibitions within the Bill of Rights are limitations on the exercise of power; they are not an affirmative grant of power to the Government. I, therefore, do not read the several references to capital punishment as foreclosing this Court from considering whether the death penalty in a particular case offends the Eighth and Fourteenth Amendments. Nor are "cruel and unusual punishments" and "due process of law" static concepts whose meaning and scope were sealed at the time of their writing. They were designed to be dynamic and to gain meaning through application to specific circumstances, many of which were not contemplated by their authors. While flexibility in the application of these broad concepts is one of the hallmarks of our system of government, the Court is not free to read into the Constitution a meaning that is plainly at variance with its language. Both the language of the Fifth and Fourteenth Amendments and the history of the Eighth Amendment confirm beyond doubt that the death penalty was considered to be a constitutionally permissible punishment. It is, however, within the historic process of constitutional adjudication to challenge the imposition of the death penalty in some barbaric manner or as a penalty wholly disproportionate to a particular criminal act. And in making such a judgment in a case before it, a court may consider contemporary standards to the extent they are relevant. While this weighing of a punishment against the Eighth Amendment standard on a case-by-case basis is consonant with history and precedent, it is not what *421 petitioners demand in these cases. They seek nothing less than the total abolition of capital punishment by judicial fiat.
II
Petitioners assert that the constitutional issue is an open one uncontrolled by prior decisions of this Court. They view the several cases decided under the Eighth Amendment as assuming the constitutionality of the death penalty without focusing squarely upon the issue. I do not believe that the case law can be so easily cast aside. The Court on numerous occasions has both assumed and asserted the constitutionality of capital punishment. In several cases that assumption provided a necessary foundation for the decision, as the issue was whether a particular means of carrying out a capital sentence would be allowed to stand. Each of those decisions necessarily was premised on the assumption that some method of exacting the penalty was permissible.
The issue in the first capital case in which the Eighth Amendment was invoked, Wilkerson v. Utah, 99 U.S. 130 (1879), was whether carrying out a death sentence by public shooting was cruel and unusual punishment. A unanimous Court upheld that form of execution, noting first that the punishment itself, as distinguished from the mode of its infliction, was "not pretended by the counsel of the prisoner" (id., at 137) to be cruel and unusual. The Court went on to hold that:
"Cruel and unusual punishments are forbidden by the Constitution, but the authorities . . . are quite sufficient to show that the punishment of shooting as a mode of executing the death penalty for the crime of murder in the first degree is not included in that category . . . ." Id., at 134-135.
Eleven years later, in In re Kemmler, 136 U.S. 436 (1890), the Court again faced a question involving the *422 method of carrying out a capital sentence. On review of a denial of habeas corpus relief by the Supreme Court of New York, this Court was called on to decide whether electrocution, which only very recently had been adopted by the New York Legislature as a means of execution, was impermissibly cruel and unusual in violation of the Fourteenth Amendment.[4] Chief Justice Fuller, speaking for the entire Court, ruled in favor of the State. Electrocution had been selected by the legislature, after careful investigation, as "the most humane and practical method known to modern science of carrying into effect the sentence of death." Id., at 444. The Court drew a clear line between the penalty itself and the mode of its execution:
"Punishments are cruel when they involve torture or a lingering death; but the punishment of death *423 is not cruel, within the meaning of that word as used in the Constitution. It implies there something inhuman and barbarous, something more than the mere extinguishment of life." Id., at 447.
More than 50 years later, in Louisiana ex rel. Francis v. Resweber, 329 U.S. 459 (1947), the Court considered a case in which, due to a mechanical malfunction, Louisiana's initial attempt to electrocute a convicted murderer had failed. Petitioner sought to block a second attempt to execute the sentence on the ground that to do so would constitute cruel and unusual punishment. In the plurality opinion written by Mr. Justice Reed, concurred in by Chief Justice Vinson and Justices Black and Jackson, relief was denied. Again the Court focused on the manner of execution, never questioning the propriety of the death sentence itself.
"The case before us does not call for an examination into any punishments except that of death. . . . The traditional humanity of modern Anglo-American law forbids the infliction of unnecessary pain in the execution of the death sentence. . . .
". . . The cruelty against which the Constitution protects a convicted man is cruelty inherent in the method of punishment, not the necessary suffering involved in any method employed to extinguish life humanely." Id., at 463-464.
Mr. Justice Frankfurter, unwilling to dispose of the case under the Eighth Amendment's specific prohibition, approved the second execution attempt under the Due Process Clause. He concluded that "a State may be found to deny a person due process by treating even one guilty of crime in a manner that violates standards of *424 decency more or less universally accepted though not when it treats him by a mode about which opinion is fairly divided." Id., at 469-470.
The four dissenting Justices, although finding a second attempt at execution to be impermissibly cruel, expressly recognized the validity of capital punishment:
"In determining whether the proposed procedure is unconstitutional, we must measure it against a lawful electrocution. . . . Electrocution, when instantaneous, can be inflicted by a state in conformity with due process of law. . . .
"The all-important consideration is that the execution shall be so instantaneous and substantially painless that the punishment shall be reduced, as nearly as possible, to no more than that of death itself." Id., at 474 (original emphasis).
Each of these cases involved the affirmance of a death sentence where its validity was attacked as violating the Eighth Amendment. Five opinions were written in these three cases, expressing the views of 23 Justices. While in the narrowest sense it is correct to say that in none was there a frontal attack upon the constitutionality of the death penalty, each opinion went well beyond an unarticulated assumption of validity. The power of the States to impose capital punishment was repeatedly and expressly recognized.
In addition to these cases in which the constitutionality of the death penalty was a necessary foundation for the decision, those who today would have this Court undertake the absolute abolition of the death penalty also must reject the opinions of other cases stipulating or assuming the constitutionality of capital punishment. Trop v. Dulles, 356 U.S. 86, 99, 100 (1958); Weems v. United States, 217 U.S. 349, 382, 409 (1910) *425 (White, J., joined by Holmes, J., dissenting).[5] See also McGautha v. California, 402 U. S., at 226 (separate opinion of Black, J.); Robinson v. California, 370 U.S. 660, 676 (1962) (DOUGLAS, J., concurring).
The plurality opinion in Trop v. Dulles, supra, is of special interest since it is this opinion, in large measure, that provides the foundation for the present attack on the death penalty.[6] It is anomalous that the standard urged by petitioners"evolving standards of decency that mark the progress of a maturing society" (356 U. S., at 101)should be derived from an opinion that so unqualifiedly rejects their arguments. Chief Justice Warren, joined by Justices Black, DOUGLAS, and Whittaker, stated flatly:
"At the outset, let us put to one side the death penalty as an index of the constitutional limit on punishment. Whatever the arguments may be against capital punishment, both on moral grounds and in terms of accomplishing the purposes of punishment and they are forcefulthe death penalty has been employed throughout our history, and, in a day when it is still widely accepted, it cannot be said to violate the constitutional concept of cruelty." Id., at 99.
The issue in Trop was whether forfeiture of citizenship was a cruel and unusual punishment when imposed on *426 a wartime deserter who had gone "over the hill" for less than a day and had willingly surrendered. In examining the consequences of the relatively novel punishment of denationalization,[7] Chief Justice Warren drew a line between "traditional" and "unusual" penalties:
"While the State has the power to punish, the [Eighth] Amendment stands to assure that this power be exercised within the limits of civilized standards. Fines, imprisonment and even execution may be imposed depending upon the enormity of the crime, but any technique outside the bounds of these traditional penalties is constitutionally suspect." Id., at 100.
The plurality's repeated disclaimers of any attack on capital punishment itself must be viewed as more than offhand dicta since those views were written in direct response to the strong language in Mr. Justice Frankfurter's dissent arguing that denationalization could not be a disproportionate penalty for a concededly capital offense.[8]
The most recent precedents of this CourtWitherspoon v. Illinois, 391 U.S. 510 (1968), and McGautha v. California, supraare also premised to a significant degree on the constitutionality of the death penalty. While the scope of review in both cases was limited to questions involving the procedures for selecting juries *427 and regulating their deliberations in capital cases,[9] those opinions were "singularly academic exercise[s]"[10] if the members of this Court were prepared at those times to find in the Constitution the complete prohibition of the death penalty. This is especially true of Mr. Justice Harlan's opinion for the Court in McGautha, in which, after a full review of the history of capital punishment, he concluded that "we find it quite impossible to say that committing to the untrammeled discretion of the jury the power to pronounce life or death in capital cases is offensive to anything in the Constitution." Id., at 207.[11]
*428 Perhaps enough has been said to demonstrate the unswerving position that this Court has taken in opinions spanning the last hundred years. On virtually every occasion that any opinion has touched on the question of the constitutionality of the death penalty, it has been asserted affirmatively, or tacitly assumed, that the Constitution does not prohibit the penalty. No Justice of the Court, until today, has dissented from this consistent reading of the Constitution. The petitioners in these cases now before the Court cannot fairly avoid the weight of this substantial body of precedent merely by asserting that there is no prior decision precisely in point. Stare decisis, if it is a doctrine founded on principle, surely applies where there exists a long line of cases endorsing or necessarily assuming the validity of a particular matter of constitutional interpretation. Green v. United States, 356 U.S. 165, 189-193 (1958) (Frankfurter, J., concurring). While these oft-repeated expressions of unchallenged belief in the constitutionality of capital punishment may not justify a summary disposition of the constitutional question before us, they are views expressed and joined in over the years by no less than 29 Justices of this Court and therefore merit the greatest respect.[12] Those who now resolve to set those views aside indeed have a heavy burden.
III
Petitioners seek to avoid the authority of the foregoing cases, and the weight of express recognition in the Constitution itself, by reasoning which will not withstand analysis. The thesis of petitioners' case derives from several opinions in which members of this Court *429 have recognized the dynamic nature of the prohibition against cruel and unusual punishments. The final meaning of those words was not set in 1791. Rather, to use the words of Chief Justice Warren speaking for a plurality of the Court in Trop v. Dulles, 356 U. S., at 100-101:
"[T]he words of the Amendment are not precise, and . . . their scope is not static. The Amendment must draw its meaning from the evolving standards of decency that mark the progress of a maturing society."
But this was not new doctrine. It was the approach to the Eighth Amendment taken by Mr. Justice McKenna in his opinion for the Court in Weems v. United States, 217 U.S. 349 (1910). Writing for four Justices sitting as the majority of the six-man Court deciding the case, he concluded that the clause must be "progressive"; it is not "fastened to the obsolete but may acquire meaning as public opinion becomes enlightened by a humane justice." Id., at 378. The same test was offered by Mr. Justice Frankfurter in his separate concurrence in Louisiana ex rel. Francis v. Resweber, 329 U. S., at 469. While he rejected the notion that the Fourteenth Amendment made the Eighth Amendment fully applicable to the States, he nonetheless found as a matter of due process that the States were prohibited from "treating even one guilty of crime in a manner that violates standards of decency more or less universally accepted."
Whether one views the question as one of due process or of cruel and unusual punishment, as I do for convenience in this case, the issue is essentially the same.[13] The fundamental premise upon which either standard is based is that notions of what constitutes cruel and unusual punishment or due process do evolve. *430 Neither the Congress nor any state legislature would today tolerate pillorying, branding, or cropping or nailing of the earspunishments that were in existence during our colonial era.[14] Should, however, any such punishment be prescribed, the courts would certainly enjoin its execution. See Jackson v. Bishop, 404 F.2d 571 (CA8 1968). Likewise, no court would approve any method of implementation of the death sentence found to involve unnecessary cruelty in light of presently available alternatives. Similarly, there may well be a process of evolving attitude with respect to the application of the death sentence for particular crimes.[15] See McGautha v. California, 402 U. S., at 242 (DOUGLAS, J., dissenting).
But we are not asked to consider the permissibility of any of the several methods employed in carrying out the death sentence. Nor are we asked, at least as part of the core submission in these cases, to determine whether the penalty might be a grossly excessive punishment for some specific criminal conduct. Either inquiry would call for a discriminating evaluation of particular means, or of the relationship between particular conduct and its punishment. Petitioners' principal argument goes far beyond the traditional process of case-by-case inclusion and exclusion. Instead the argument insists on an unprecedented constitutional rule of absolute prohibition of capital punishment for any crime, regardless of its depravity and impact on society. In calling for a precipitate and final judicial end to this form of penalty as offensive to evolving standards of decency, petitioners would have this Court abandon the traditional and more refined approach consistently followed in its prior Eighth Amendment precedents. What they are saying, in effect, is that the evolutionary *431 process has come suddenly to an end; that the ultimate wisdom as to the appropriateness of capital punishment under all circumstances, and for all future generations, has somehow been revealed.
The prior opinions of this Court point with great clarity to reasons why those of us who sit on this Court at a particular time should act with restraint before assuming, contrary to a century of precedent, that we now know the answer for all time to come. First, where as here, the language of the applicable provision provides great leeway and where the underlying social policies are felt to be of vital importance, the temptation to read personal preference into the Constitution is understandably great. It is too easy to propound our subjective standards of wise policy under the rubric of more or less universally held standards of decency. See Trop v. Dulles, 356 U. S., at 103 (Warren, C. J.), 119-120 (Frankfurter, J., dissenting); Louisiana ex rel. Francis v. Resweber, 329 U. S., at 470-471 (Frankfurter, J., concurring); Weems v. United States, 217 U. S., at 378-379 (McKenna, J.).
The second consideration dictating judicial self-restraint arises from a proper recognition of the respective roles of the legislative and judicial branches. The designation of punishments for crimes is a matter peculiarly within the sphere of the state and federal legislative bodies. See, e. g., In re Kemmler, 136 U. S., at 447; Trop v. Dulles, 356 U. S., at 103. When asked to encroach on the legislative prerogative we are well counseled to proceed with the utmost reticence. The review of legislative choices, in the performance of our duty to enforce the Constitution, has been characterized most appropriately by Mr. Justice Holmes as "the gravest and most delicate duty that this Court is called on to perform." Blodgett v. Holden, 275 U.S. 142, 147-148 (1927) (separate opinion).
*432 How much graver is that duty when we are not asked to pass on the constitutionality of a single penalty under the facts of a single case but instead are urged to overturn the legislative judgments of 40 state legislatures as well as those of Congress. In so doing is the majority able to claim, as did the Court in Weems, that it appreciates "to the fullest the wide range of power that the legislature possesses to adapt its penal laws to conditions as they may exist and punish the crimes of men according to their forms and frequency"? 217 U.S., at 379. I think not. No more eloquent statement of the essential separation of powers limitation on our prerogative can be found than the admonition of Mr. Justice Frankfurter, dissenting in Trop. His articulation of the traditional view takes on added significance where the Court undertakes to nullify the legislative judgments of the Congress and four-fifths of the States.
"What is always basic when the power of Congress to enact legislation is challenged is the appropriate approach to judicial review of congressional legislation . . . . When the power of Congress to pass a statute is challenged, the function of this Court is to determine whether legislative action lies clearly outside the constitutional grant of power to which it has been, or may fairly be, referred. In making this determination, the Court sits in judgment on the action of a co-ordinate branch of the Government while keeping unto itselfas it must under our constitutional systemthe final determination of its own power to act. . . .
"Rigorous observance of the difference between limits of power and wise exercise of powerbetween questions of authority and questions of prudencerequires the most alert appreciation of this decisive but subtle relationship of two concepts that too easily coalesce. No less does it require a *433 disciplined will to adhere to the difference. It is not easy to stand aloof and allow want of wisdom to prevail, to disregard one's own strongly held view of what is wise in the conduct of affairs. But it is not the business of this Court to pronounce policy. It must observe a fastidious regard for limitations on its own power, and this precludes the Court's giving effect to its own notions of what is wise or politic. That self-restraint is of the essence in the observance of the judicial oath, for the Constitution has not authorized the judges to sit in judgment on the wisdom of what Congress and the Executive Branch do." 356 U.S., at 119-120.
See also Mr. Justice White's dissenting opinion in Weems v. United States, 217 U. S., at 382.
IV
Although determining the range of available punishments for a particular crime is a legislative function, the very presence of the Cruel and Unusual Punishments Clause within the Bill of Rights requires, in the context of a specific case, that courts decide whether particular acts of the Congress offend that Amendment. The Due Process Clause of the Fourteenth Amendment imposes on the judiciary a similar obligation to scrutinize state legislation. But the proper exercise of that constitutional obligation in the cases before us today must be founded on a full recognition of the several considerations set forth abovethe affirmative references to capital punishment in the Constitution, the prevailing precedents of this Court, the limitations on the exercise of our power imposed by tested principles of judicial self-restraint, and the duty to avoid encroachment on the powers conferred upon state and federal legislatures. In the face of these considerations, only the most conclusive *434 of objective demonstrations could warrant this Court in holding capital punishment per se unconstitutional. The burden of seeking so sweeping a decision against such formidable obstacles is almost insuperable. Viewed from this perspective, as I believe it must be, the case against the death penalty falls far short.
Petitioners' contentions are premised, as indicated above, on the long-accepted view that concepts embodied in the Eighth and Fourteenth Amendments evolve. They present, with skill and persistence, a list of "objective indicators" which are said to demonstrate that prevailing standards of human decency have progressed to the final point of requiring the Court to hold, for all cases and for all time, that capital punishment is unconstitutional.
Briefly summarized, these proffered indicia of contemporary standards of decency include the following: (i) a worldwide trend toward the disuse of the death penalty;[16] (ii) the reflection in the scholarly literature of a progressive rejection of capital punishment founded essentially on moral opposition to such treatment;[17] (iii) the decreasing numbers of executions over the last 40 years and especially over the last decade;[18] (iv) the *435 small number of death sentences rendered in relation to the number of cases in which they might have been imposed;[19] and (v) the indication of public abhorrence of *436 the penalty reflected in the circumstances that executions are no longer public affairs.[20] The foregoing is an incomplete summary but it touches the major bases of petitioners' presentation. Although they are not appropriate for consideration as objective evidence, petitioners strongly urge two additional propositions. They contend, first, that the penalty survives public condemnation only through the infrequency, arbitrariness, and discriminatory nature of its application, and second, that there no longer exists any legitimate justification for the utilization of the ultimate penalty. These contentions, which have proved persuasive to several of the Justices constituting the majority, deserve separate consideration and will be considered in the ensuing sections. Before turning to those arguments, I first address the argument based on "objective" factors.
Any attempt to discern contemporary standards of decency through the review of objective factors must take into account several overriding considerations which petitioners choose to discount or ignore. In a democracy *437 the first indicator of the public's attitude must always be found in the legislative judgments of the people's chosen representatives. MR. JUSTICE MARSHALL'S opinion today catalogues the salient statistics. Forty States,[21] the District of Columbia, and the Federal Government still authorize the death penalty for a wide variety of crimes. That number has remained relatively static since the end of World War I. Ante, at 339-341. That does not mean, however, that capital punishment has become a forgotten issue in the legislative arena. As recently as January, 1971, Congress approved the death penalty for congressional assassination. 18 U.S. C. § 351. In 1965 Congress added the death penalty for presidential and vice presidential assassinations. 18 U.S. C. § 1751. Additionally, the aircraft piracy statute passed in 1961 also carries the death penalty. 49 U.S. C. § 1472 (i). MR. JUSTICE BLACKMUN'S dissenting opinion catalogues the impressive ease with which each of these statutes was approved. Ante, at 412-413. On the converse side, a bill proposing the abolition of capital punishment for all federal crimes was introduced in 1967 but failed to reach the Senate floor.[22]
At the state level, New York, among other States, has recently undertaken reconsideration of its capital crimes. A law passed in 1965 restricted the use of capital punishment to the crimes of murder of a police officer and murder by a person serving a sentence of life imprisonment. N. Y. Penal Code § 125.30 (1967).
I pause here to state that I am at a loss to understand *438 how those urging this Court to pursue a course of absolute abolition as a matter of constitutional judgment can draw any support from the New York experience. As is also the case with respect to recent legislative activity in Canada[23] and Great Britain,[24] New York's decision to restrict the availability of the death penalty is a product of refined and discriminating legislative judgment, reflecting, not the total rejection of capital punishment as inherently cruel, but a desire to limit it to those circumstances in which legislative judgment deems retention to be in the public interest. No such legislative flexibility is permitted by the contrary course petitioners urge this Court to follow.[25]
In addition to the New York experience, a number of other States have undertaken reconsideration of capital punishment in recent years. In four States the penalty has been put to a vote of the people through public referendaa means likely to supply objective evidence of community standards. In Oregon a referendum seeking abolition of capital punishment failed in 1958 but was subsequently approved in 1964.[26] Two years later the penalty was approved in Colorado by a wide margin.[27]*439 In Massachusetts in 1968, in an advisory referendum, the voters there likewise recommended retention of the penalty. In 1970, approximately 64% of the voters in Illinois approved the penalty.[28] In addition, the National Commission on Reform of Federal Criminal Laws reports that legislative committees in Massachusetts, Pennsylvania, and Maryland recommended abolition, while committees in New Jersey and Florida recommended retention.[29] The legislative views of other States have been summarized by Professor Hugo Bedau in his compilation of sources on capital punishment entitled The Death Penalty in America:
"What our legislative representatives think in the two score states which still have the death penalty may be inferred from the fate of the bills to repeal or modify the death penalty filed during recent years in the legislatures of more than half of these states. In about a dozen instances, the bills emerged from committee for a vote. But in none except Delaware did they become law. In those states where these bills were brought to the floor of the legislatures, the vote in most instances wasn't even close."[30]
This recent history of activity with respect to legislation concerning the death penalty abundantly refutes the abolitionist position.
The second and even more direct source of information *440 reflecting the public's attitude toward capital punishment is the jury. In Witherspoon v. Illinois, 391 U.S. 510 (1968), MR. JUSTICE STEWART, joined by JUSTICES BRENNAN and MARSHALL, characterized the jury's historic function in the sentencing process in the following terms:
"[T]he jury is given broad discretion to decide whether or not death is `the proper penalty' in a given case, and a juror's general views about capital punishment play an inevitable role in any such decision.
"A man who opposes the death penalty, no less than one who favors it, can make the discretionary judgment entrusted to him by the State and can thus obey the oath he takes as a juror. . . . Guided by neither rule nor standard, . . . a jury that must choose between life imprisonment and capital punishment can do little moreand must do nothing lessthan express the conscience of the community on the ultimate question of life or death."
"[O]ne of the most important functions any jury can perform in making such a selection is to maintain a link between contemporary community values and the penal systema link without which the determination of punishment could hardly reflect `the evolving standards of decency that mark the progress of a maturing society.' Trop v. Dulles, . . ."[31]
Any attempt to discern, therefore, where the prevailing standards of decency lie must take careful account of *441 the jury's response to the question of capital punishment. During the 1960's juries returned in excess of a thousand death sentences, a rate of approximately two per week. Whether it is true that death sentences were returned in less than 10% of the cases as petitioners estimate or whether some higher percentage is more accurate,[32] these totals simply do not support petitioners' assertion at oral argument that "the death penalty is virtually unanimously repudiated and condemned by the conscience of contemporary society."[33] It is also worthy of note that the annual rate of death sentences has remained relatively constant over the last 10 years and that the figure for 1970127 sentencesis the highest annual total since 1961.[34] It is true that the sentencing rate might be expected to rise, rather than remain constant, when the number of violent crimes increases as it has in this country.[35] And it may be conceded that the constancy in these statistics indicates the unwillingness of juries to demand the ultimate penalty in many cases where it might be imposed. But these considerations fall short of indicating that juries are imposing the death penalty with such rarity as to justify this Court in reading into this circumstance a public rejection of capital punishment.[36]
*442 One must conclude, contrary to petitioners' submission, that the indicators most likely to reflect the public's viewlegislative bodies, state referenda and the juries which have the actual responsibilitydo not support the contention that evolving standards of decency require total abolition of capital punishment.[37] Indeed, *443 the weight of the evidence indicates that the public generally has not accepted either the morality or the social merit of the views so passionately advocated by the articulate spokesmen for abolition. But however one may assess the amorphous ebb and flow of public opinion generally on this volatile issue, this type of inquiry lies at the peripherynot the coreof the judicial process in constitutional cases. The assessment of popular opinion is essentially a legislative, not a judicial, function.
V
Petitioners seek to salvage their thesis by arguing that the infrequency and discriminatory nature of the actual resort to the ultimate penalty tend to diffuse public opposition. We are told that the penalty is imposed exclusively on uninfluential minorities"the poor and powerless, personally ugly and socially unacceptable."[38] It is urged that this pattern of application assures that large segments of the public will be either uninformed or unconcerned and will have no reason to measure the punishment against prevailing moral standards.
Implicitly, this argument concedes the unsoundness of petitioners' contention, examined above under Part IV, that objective evidence shows a present and widespread community rejection of the death penalty. It is now said, *444 in effect, not that capital punishment presently offends our citizenry, but that the public would be offended if the penalty were enforced in a nondiscriminatory manner against a significant percentage of those charged with capital crimes, and if the public were thereby made aware of the moral issues surrounding capital punishment. Rather than merely registering the objective indicators on a judicial balance, we are asked ultimately to rest a far-reaching constitutional determination on a prediction regarding the subjective judgments of the mass of our people under hypothetical assumptions that may or may not be realistic.
Apart from the impermissibility of basing a constitutional judgment of this magnitude on such speculative assumptions, the argument suffers from other defects. If, as petitioners urge, we are to engage in speculation, it is not at all certain that the public would experience deep-felt revulsion if the States were to execute as many sentenced capital offenders this year as they executed in the mid-1930's.[39] It seems more likely that public reaction, rather than being characterized by undifferentiated rejection, would depend upon the facts and circumstances surrounding each particular case.
Members of this Court know, from the petitions and appeals that come before us regularly, that brutish and revolting murders continue to occur with disquieting frequency. Indeed, murders are so commonplace *445 in our society that only the most sensational receive significant and sustained publicity. It could hardly be suggested that in any of these highly publicized murder casesthe several senseless assassinations or the too numerous shocking multiple murders that have stained this country's recent historythe public has exhibited any signs of "revulsion" at the thought of executing the convicted murderers. The public outcry, as we all know, has been quite to the contrary. Furthermore, there is little reason to suspect that the public's reaction would differ significantly in response to other less publicized murders. It is certainly arguable that many such murders, because of their senselessness or barbarousness, would evoke a public demand for the death penalty rather than a public rejection of that alternative. Nor is there any rational basis for arguing that the public reaction to any of these crimes would be muted if the murderer were "rich and powerful." The demand for the ultimate sanction might well be greater, as a wealthy killer is hardly a sympathetic figure. While there might be specific cases in which capital punishment would be regarded as excessive and shocking to the conscience of the community, it can hardly be argued that the public's dissatisfaction with the penalty in particular cases would translate into a demand for absolute abolition.
In pursuing the foregoing speculation, I do not suggest that it is relevant to the appropriate disposition of these cases. The purpose of the digression is to indicate that judicial decisions cannot be founded on such speculations and assumptions, however appealing they may seem.
But the discrimination argument does not rest alone on a projection of the assumed effect on public opinion of more frequent executions. Much also is made of the undeniable fact that the death penalty has a greater impact on the lower economic strata of society, which *446 include a relatively higher percentage of persons of minority racial and ethnic group backgrounds. The argument drawn from this fact is two-pronged. In part it is merely an extension of the speculative approach pursued by petitioners, i. e., that public revulsion is suppressed in callous apathy because the penalty does not affect persons from the white middle class which constitutes the majority in this country. This aspect, however, adds little to the infrequency rationalization for public apathy which I have found unpersuasive.
As MR. JUSTICE MARSHALL'S opinion today demonstrates, the argument does have a more troubling aspect. It is his contention that if the average citizen were aware of the disproportionate burden of capital punishment borne by the "poor, the ignorant, and the underprivileged," he would find the penalty "shocking to his conscience and sense of justice" and would not stand for its further use. Ante, at 365-366, 369. This argument, like the apathy rationale, calls for further speculation on the part of the Court. It also illuminates the quicksands upon which we are asked to base this decision. Indeed, the two contentions seem to require contradictory assumptions regarding the public's moral attitude toward capital punishment. The apathy argument is predicated on the assumption that the penalty is used against the less influential elements of society, that the public is fully aware of this, and that it tolerates use of capital punishment only because of a callous indifference to the offenders who are sentenced. MR. JUSTICE MARSHALL'S argument, on the other hand, rests on the contrary assumption that the public does not know against whom the penalty is enforced and that if the public were educated to this fact it would find the punishment intolerable. Ante, at 369. Neither assumption can claim to be an entirely accurate portrayal of public attitude; for some acceptance of capital punishment might be a consequence *447 of hardened apathy based on the knowledge of infrequent and uneven application, while for others acceptance may grow only out of ignorance. More significantly, however, neither supposition acknowledges what, for me, is a more basic flaw.
Certainly the claim is justified that this criminal sanction falls more heavily on the relatively impoverished and underprivileged elements of society. The "have-nots" in every society always have been subject to greater pressure to commit crimes and to fewer constraints than their more affluent fellow citizens. This is, indeed, a tragic byproduct of social and economic deprivation, but it is not an argument of constitutional proportions under the Eighth or Fourteenth Amendment. The same discriminatory impact argument could be made with equal force and logic with respect to those sentenced to prison terms. The Due Process Clause admits of no distinction between the deprivation of "life" and the deprivation of "liberty." If discriminatory impact renders capital punishment cruel and unusual, it likewise renders invalid most of the prescribed penalties for crimes of violence. The root causes of the higher incidence of criminal penalties on "minorities and the poor" will not be cured by abolishing the system of penalties. Nor, indeed, could any society have a viable system of criminal justice if sanctions were abolished or ameliorated because most of those who commit crimes happen to be underprivileged. The basic problem results not from the penalties imposed for criminal conduct but from social and economic factors that have plagued humanity since the beginning of recorded history, frustrating all efforts to create in any country at any time the perfect society in which there are no "poor," no "minorities" and no "underprivileged."[40]*448 The causes underlying this problem are unrelated to the constitutional issue before the Court.
Finally, yet another theory for abolishing the death penaltyreflected in varying degrees in each of the concurring opinions todayis predicated on the discriminatory impact argument. Quite apart from measuring the public's acceptance or rejection of the death penalty under the "standards of decency" rationale, MR. JUSTICE DOUGLAS finds the punishment cruel and unusual because it is "arbitrarily" invoked. He finds that "the basic theme of equal protection is implicit" in the Eighth Amendment, and that the Amendment is violated when jury sentencing may be characterized as arbitrary or discriminatory. Ante, at 249. While MR. JUSTICE STEWART does not purport to rely on notions of equal protection, he also rests primarily on what he views to be a history of arbitrariness. Ante, at 309-310.[41] Whatever may be the facts with respect to jury sentencing, this argument calls for a reconsideration of the "standards" aspects of the Court's decision in McGautha v. California, 402 U.S. 183 (1971). Although that is the unmistakable thrust of these opinions today, I see no reason to reassess the standards question considered so carefully in Mr. Justice Harlan's opinion for the Court *449 last Term. Having so recently reaffirmed our historic dedication to entrusting the sentencing function to the jury's "untrammeled discretion" (id., at 207), it is difficult to see how the Court can now hold the entire process constitutionally defective under the Eighth Amendment. For all of these reasons I find little merit in the various discrimination arguments, at least in the several lights in which they have been cast in these cases.
Although not presented by any of the petitioners today, a different argument, premised on the Equal Protection Clause, might well be made. If a Negro defendant, for instance, could demonstrate that members of his race were being singled out for more severe punishment than others charged with the same offense, a constitutional violation might be established. This was the contention made in Maxwell v. Bishop, 398 F.2d 138 (CA8 1968), vacated and remanded on other grounds, 398 U.S. 262 (1970), in which the Eighth Circuit was asked to issue a writ of habeas corpus setting aside a death sentence imposed on a Negro defendant convicted of rape. In that case substantial statistical evidence was introduced tending to show a pronounced disproportion in the number of Negroes receiving death sentences for rape in parts of Arkansas and elsewhere in the South. That evidence was not excluded but was found to be insufficient to show discrimination in sentencing in Maxwell's trial. MR. JUSTICE BLACKMUN, then sitting on the Court of Appeals for the Eighth Circuit. concluded:
"The petitioner's argument is an interesting one and we are not disposed to say that it could not have some validity and weight in certain situations. Like the trial court, however . . . we feel that the argument does not have validity and pertinent application to Maxwell's case.
....
*450 "We are not yet ready to condemn and upset the result reached in every case of a Negro rape defendant in the State of Arkansas on the basis of broad theories of social and statistical injustice. . . .
.....
"We do not say that there is no ground for suspicion that the death penalty for rape may have been discriminatorily applied over the decades in that large area of states whose statutes provide for it. There are recognizable indicators of this. But . . . improper state practice of the past does not automatically invalidate a procedure of the present. . . ." Id., at 146-148.
I agree that discriminatory application of the death penalty in the past, admittedly indefensible, is no justification for holding today that capital punishment is invalid in all cases in which sentences were handed out to members of the class discriminated against. But Maxwell does point the way to a means of raising the equal protection challenge that is more consonant with precedent and the Constitution's mandates than the several courses pursued by today's concurring opinions.
A final comment on the racial discrimination problem seems appropriate. The possibility of racial bias in the trial and sentencing process has diminished in recent years. The segregation of our society in decades past, which contributed substantially to the severity of punishment for interracial crimes, is now no longer prevalent in this country. Likewise, the day is past when juries do not represent the minority group elements of the community. The assurance of fair trials for all citizens is greater today than at any previous time in our history. Because standards of criminal justice have "evolved" in a manner favorable to the accused, discriminatory imposition of capital punishment is far less likely today than in the past.
*451 VI
Petitioner in Branch v. Texas, No. 69-5031, and to a lesser extent the petitioners in the other cases before us today, urge that capital punishment is cruel and unusual because it no longer serves any rational legislative interests. Before turning to consider whether any of the traditional aims of punishment justify the death penalty, I should make clear the context in which I approach this aspect of the cases.
First, I find no supportin the language of the Constitution, in its history, or in the cases arising under itfor the view that this Court may invalidate a category of penalties because we deem less severe penalties adequate to serve the ends of penology. While the cases affirm our authority to prohibit punishments that are cruelly inhumane (e. g., Wilkerson v. Utah, 99 U. S., at 135-136; In re Kemmler, 136 U. S., at 447), and punishments that are cruelly excessive in that they are disproportionate to particular crimes (see Part VII, infra), the precedents of this Court afford no basis for striking down a particular form of punishment because we may be persuaded that means less stringent would be equally efficacious.
Secondly, if we were free to question the justifications for the use of capital punishment, a heavy burden would rest on those who attack the legislatures' judgments to prove the lack of rational justifications. This Court has long held that legislative decisions in this area, which lie within the special competency of that branch, are entitled to a presumption of validity. See, e. g., Trop v. Dulles, 356 U. S., at 103; Louisiana ex rel. Francis v. Resweber, 329 U. S., at 470 (Frankfurter, J., concurring); Weems v. United States, 217 U. S., at 378-379; In re Kemmler, 136 U. S., at 449.
*452 I come now to consider, subject to the reservations above expressed, the two justifications most often cited for the retention of capital punishment. The concept of retributionthough popular for centuriesis now criticized as unworthy of a civilized people. Yet this Court has acknowledged the existence of a retributive element in criminal sanctions and has never heretofore found it impermissible. In Williams v. New York, 337 U.S. 241 (1949), Mr. Justice Black stated that,
"Retribution is no longer the dominant objective of the criminal law. Reformation and rehabilitation of offenders have become important goals of criminal jurisprudence." Id., at 248.
It is clear, however, that the Court did not reject retribution altogether. The record in that case indicated that one of the reasons why the trial judge imposed the death penalty was his sense of revulsion at the "shocking details of the crime." Id., at 244. Although his motivation was clearly retributive, the Court upheld the trial judge's sentence.[42] Similarly, MR. JUSTICE MARSHALL noted in his plurality opinion in Powell v. Texas, 392 U.S. 514, 530 (1968), that this Court "has never held that anything in the Constitution requires that penal sanctions be designed solely to achieve therapeutic or rehabilitative effects."[43]
*453 While retribution alone may seem an unworthy justification in a moral sense, its utility in a system of criminal justice requiring public support has long been recognized. Lord Justice Denning, now Master of the Rolls of the Court of Appeal in England, testified on this subject before the British Royal Commission on Capital Punishment:
"Many are inclined to test the efficacy of punishment solely by its value as a deterrent: but this is too narrow a view. Punishment is the way in which society expresses its denunciation of wrong doing: and, in order to maintain respect for law, it is essential that the punishment inflicted for grave crimes should adequately reflect the revulsion felt by the great majority of citizens for them. It is a mistake to consider the objects of punishment as being deterrent or reformative or preventive and nothing else. If this were so, we should not send to prison a man who was guilty of motor manslaughter, but only disqualify him from driving; but would public opinion be content with this? The truth is that some crimes are so outrageous that society insists on adequate punishment, because the wrong-doer deserves it, irrespective of whether it is a deterrent or not."[44]
The view expressed by Lord Denning was cited approvingly in the Royal Commission's Report, recognizing "a *454 strong and widespread demand for retribution."[45] MR. JUSTICE STEWART makes much the same point in his opinion today when he concludes that expression of man's retributive instincts in the sentencing process "serves an important purpose in promoting the stability of a society governed by law." Ante, at 308. The view, moreover, is not without respectable support in the jurisprudential literature in this country,[46] despite a substantial body of opinion to the contrary.[47] And it is conceded on all sides that, not infrequently, cases arise that are so shocking or offensive that the public demands the ultimate penalty for the transgressor.
Deterrence is a more appealing justification, although opinions again differ widely. Indeed, the deterrence issue lies at the heart of much of the debate between the abolitionists and retentionists.[48] Statistical studies, based primarily on trends in States that have abolished the penalty, tend to support the view that the death penalty has not been proved to be a superior deterrent.[49] Some dispute the validity of this conclusion,[50] pointing *455 out that the studies do not show that the death penalty has no deterrent effect on any categories of crimes. On the basis of the literature and studies currently available, I find myself in agreement with the conclusions drawn by the Royal Commission following its exhaustive study of this issue:
"The general conclusion which we reach, after careful review of all the evidence we have been able to obtain as to the deterrent effect of capital punishment, may be stated as follows. Prima facie the penalty of death is likely to have a stronger effect as a deterrent to normal human beings than any other form of punishment, and there is some evidence (though no convincing statistical evidence) that this is in fact so. But this effect does not operate universally or uniformly, and there are many offenders on whom it is limited and may often be negligible. It is accordingly important to view this question in a just perspective and not base a penal policy in relation to murder on exaggerated estimates of the uniquely deterrent force of the death penalty."[51]
Only recently this Court was called on to consider the deterrence argument in relation to punishment by fines for public drunkenness. Powell v. Texas, 392 U.S. 514 (1968). The Court was unwilling to strike down the Texas statute on grounds that it lacked a rational foundation. What MR. JUSTICE MARSHALL said there would seem to have equal applicability in this case:
"The long-standing and still raging debate over the validity of the deterrence justification for penal sanctions has not reached any sufficiently clear conclusions to permit it to be said that such sanctions are ineffective in any particular context or for any *456 particular group of people who are able to appreciate the consequences of their acts. . . ." Id., at 531.
As I noted at the outset of this section, legislative judgments as to the efficacy of particular punishments are presumptively rational and may not be struck down under the Eighth Amendment because this Court may think that some alternative sanction would be more appropriate. Even if such judgments were within the judicial prerogative, petitioners have failed to show that there exist no justifications for the legislative enactments challenged in these cases.[52] While the evidence and arguments advanced by petitioners might have proved profoundly persuasive if addressed to a legislative body, they do not approach the showing traditionally required before a court declares that the legislature has acted irrationally.
VII
In two of the cases before us today juries imposed sentences of death after convictions for rape.[53] In these cases we are urged to hold that even if capital punishment is permissible for some crimes, it is a cruel and unusual punishment for this crime. Petitioners in these cases rely on the Court's opinions holding that the Eighth Amendment, in addition to prohibiting punishments *457 deemed barbarous and inhumane, also condemns punishments that are greatly disproportionate to the crime charged. This reading of the Amendment was first expressed by Mr. Justice Field in his dissenting opinion in O'Neil v. Vermont, 144 U.S. 323, 337 (1892), a case in which a defendant charged with a large number of violations of Vermont's liquor laws received a fine in excess of $6,600, or a 54-year jail sentence if the fine was not paid. The majority refused to consider the question on the ground that the Eighth Amendment did not apply to the States. The dissent, after carefully examining the history of that Amendment and the Fourteenth, concluded that its prohibition was binding on Vermont and that it was directed against "all punishments which by their excessive length or severity are greatly disproportioned to the offences charged." Id., at 339-340.[54]
The Court, in Weems v. United States, 217 U.S. 349 (1910), adopted Mr. Justice Field's view. The defendant, in Weems, charged with falsifying Government documents, had been sentenced to serve 15 years in cadena temporal, a punishment which included carrying chains at the wrists and ankles and the perpetual loss of the right to vote and hold office. Finding the sentence grossly excessive in length and condition of imprisonment, the Court struck it down. This notion of disproportionalitythat particular sentences may be cruelly excessive for particular crimeshas been cited with approval in more recent decisions of this Court. See Robinson v. California, 370 U. S., at 667; Trop v. Dulles, 356 U. S., at 100; see also Howard v. Fleming, 191 U.S. 126, 135-136 (1903).
These cases, while providing a rationale for gauging the constitutionality of capital sentences imposed for rape, *458 also indicate the existence of necessary limitations on the judicial function. The use of limiting terms in the various expressions of this test found in the opinionsgrossly excessive, greatly disproportionateemphasizes that the Court's power to strike down punishments as excessive must be exercised with the greatest circumspection. As I have noted earlier, nothing in the history of the Cruel and Unusual Punishments Clause indicates that it may properly be utilized by the judiciary to strike down punishmentsauthorized by legislatures and imposed by juriesin any but the extraordinary case. This Court is not empowered to sit as a court of sentencing review, implementing the personal views of its members on the proper role of penology. To do so is to usurp a function committed to the Legislative Branch and beyond the power and competency of this Court.
Operating within these narrow limits, I find it quite impossible to declare the death sentence grossly excessive for all rapes. Rape is widely recognized as among the most serious of violent crimes, as witnessed by the very fact that it is punishable by death in 16 States and by life imprisonment in most other States.[55] The several reasons why rape stands so high on the list of serious crimes are well known: It is widely viewed as the most atrocious of intrusions upon the privacy and dignity of the victim; never is the crime committed accidentally; rarely can it be said to be unpremeditated; *459 often the victim suffers serious physical injury; the psychological impact can often be as great as the physical consequences; in a real sense, the threat of both types of injury is always present.[56] For these reasons, and for the reasons arguing against abolition of the death penalty altogether, the excessiveness rationale provides no basis for rejection of the penalty for rape in all cases.
The argument that the death penalty for rape lacks rational justification because less severe punishments might be viewed as accomplishing the proper goals of penology is as inapposite here as it was in considering per se abolition. See Part VI supra. The state of knowledge with respect to the deterrent value of the sentence for this crime is inconclusive.[57] Moreover, what has been said about the concept of retribution applies with equal force where the crime is rape. There are many cases in which the sordid, heinous nature of a particular crime, demeaning, humiliating, and often physically or psychologically traumatic, will call for public condemnation. In a period in our country's history when the frequency of this crime is increasing alarmingly,[58] it is indeed a grave event for the Court to take from the States whatever deterrent and retributive weight the death penalty retains.
Other less sweeping applications of the disproportionality concept have been suggested. Recently the Fourth Circuit struck down a death sentence in Ralph v. Warden, 438 F.2d 786 (1970), holding that the death penalty was an appropriate punishment for rape *460 only where life is "endangered." Chief Judge Haynsworth, who joined in the panel's opinion, wrote separately in denying the State of Maryland's petition for rehearing in order to make clear the basis for his joinder. He stated that, for him, the appropriate test was not whether life was endangered, but whether the victim in fact suffered "grievous physical or psychological harm." Id., at 794. See Rudolph v. Alabama, 375 U.S. 889 (1963) (dissent from the denial of certiorari).
It seems to me that both of these tests depart from established principles and also raise serious practical problems. How are those cases in which the victim's life is endangered to be distinguished from those in which no danger is found? The threat of serious injury is implicit in the definition of rape; the victim is either forced into submission by physical violence or by the threat of violence. Certainly that test would provide little comfort for either of the rape defendants in the cases presently before us. Both criminal acts were accomplished only after a violent struggle. Petitioner Jackson held a scissors blade against his victim's neck. Petitioner Branch had less difficulty subduing his 65-year-old victim. Both assailants threatened to kill their victims. See MR. JUSTICE DOUGLAS' opinion, ante, at 252-253. The alternate test, limiting the penalty to cases in which the victim suffers physical or emotional harm, might present even greater problems of application. While most physical effects may be seen and objectively measured, the emotional impact may be impossible to gauge at any particular point in time. The extent and duration of psychological trauma may not be known or ascertainable prior to the date of trial.
While I reject each of these attempts to establish specific categories of cases in which the death penalty may be deemed excessive, I view them as groping *461 toward what is for me the appropriate application of the Eighth Amendment. While in my view the disproportionality test may not be used either to strike down the death penalty for rape altogether or to install the Court as a tribunal for sentencing review, that test may find its application in the peculiar circumstances of specific cases. Its utilization should be limited to the rare case in which the death penalty is rendered for a crime technically falling within the legislatively defined class but factually falling outside the likely legislative intent in creating the category. Specific rape cases (and specific homicides as well) can be imagined in which the conduct of the accused would render the ultimate penalty a grossly excessive punishment. Although this case-by-case approach may seem painfully slow and inadequate to those who wish the Court to assume an activist legislative role in reforming criminal punishments, it is the approach dictated both by our prior opinions and by a due recognition of the limitations of judicial power. This approach, rather than the majority's more pervasive and less refined judgment, marks for me the appropriate course under the Eighth Amendment.
VIII
I now return to the overriding question in these cases: whether this Court, acting in conformity with the Constitution, can justify its judgment to abolish capital punishment as heretofore known in this country. It is important to keep in focus the enormity of the step undertaken by the Court today. Not only does it invalidate hundreds of state and federal laws, it deprives those jurisdictions of the power to legislate with respect to capital punishment in the future, except in a manner consistent with the cloudily outlined views of those Justices who do not purport to undertake total abolition. *462 Nothing short of an amendment to the United States Constitution can reverse the Court's judgments. Meanwhile, all flexibility is foreclosed. The normal democratic process, as well as the opportunities for the several States to respond to the will of their people expressed through ballot referenda (as in Massachusetts, Illinois, and Colorado),[59] is now shut off.
The sobering disadvantage of constitutional adjudication of this magnitude is the universality and permanence of the judgment. The enduring merit of legislative action is its responsiveness to the democratic process, and to revision and change: mistaken judgments may be corrected and refinements perfected. In England[60] and Canada[61] critical choices were made after studies canvassing all competing views, and in those countries revisions may be made in light of experience.[62]
As recently as 1967 a presidential commission did consider, as part of an overall study of crime in this country, whether the death penalty should be abolished. *463 The commission's unanimous recommendation was as follows:
"The question whether capital punishment is an appropriate sanction is a policy decision to be made by each State. Where it is retained, the types of offenses for which it is available should be strictly limited, and the law should be enforced in an even-handed and nondiscriminatory manner, with procedures for review of death sentences that are fair and expeditious. When a State finds that it cannot administer the penalty in such a manner, or that the death penalty is being imposed but not carried into effect, the penalty should be abandoned."[63]
The thrust of the Commission's recommendation, as presently relevant, is that this question "is a policy decision to be made by each State." There is no hint that this decision could or should be made by the judicial branch.
The National Commission on Reform of Federal Criminal Laws also considered the capital punishment issue. The introductory commentary of its final report states that "a sharp division [existed] within the Commission on the subject of capital punishment," although a *464 majority favored its abolition.[64] Again, consideration of the question was directed to the propriety of retention or abolition as a legislative matter. There was no suggestion that the difference of opinion existing among commission members, and generally across the country, could or should be resolved in one stroke by a decision of this Court.[65] Similar activity was, before today, evident at the state level with re-evaluation having been undertaken by special legislative committees in some States and by public ballot in others.[66]
With deference and respect for the views of the Justices who differ, it seems to me that all these studiesboth in this country and elsewheresuggest that, as a matter of policy and precedent, this is a classic case for the exercise of our oft-announced allegiance to judicial restraint. I know of no case in which greater gravity and delicacy have attached to the duty that this Court is called on to perform whenever legislationstate or federalis challenged on constitutional grounds.[67] It seems to me that the sweeping judicial action undertaken today reflects a *465 basic lack of faith and confidence in the democratic process. Many may regret, as I do, the failure of some legislative bodies to address the capital punishment issue with greater frankness or effectiveness. Many might decry their failure either to abolish the penalty entirely or selectively, or to establish standards for its enforcement. But impatience with the slowness, and even the unresponsiveness, of legislatures is no justification for judicial intrusion upon their historic powers. Rarely has there been a more appropriate opportunity for this Court to heed the philosophy of Mr. Justice Oliver Wendell Holmes. As Mr. Justice Frankfurter reminded the Court in Trop:
"[T]he whole of [Mr. Justice Holmes'] work during his thirty years of service on this Court should be a constant reminder that the power to invalidate legislation must not be exercised as if, either in constitutional theory or in the art of government, it stood as the sole bulwark against unwisdom or excesses of the moment." 356 U.S., at 128.
MR. JUSTICE REHNQUIST, with whom THE CHIEF JUSTICE, MR. JUSTICE BLACKMUN, and MR. JUSTICE POWELL join, dissenting.
The Court's judgments today strike down a penalty that our Nation's legislators have thought necessary since our country was founded. My Brothers DOUGLAS, BRENNAN, and MARSHALL would at one fell swoop invalidate laws enacted by Congress and 40 of the 50 state legislatures, and would consign to the limbo of unconstitutionality under a single rubric penalties for offenses as varied and unique as murder, piracy, mutiny, highjacking, and desertion in the face of the enemy. My Brothers STEWART and WHITE, asserting reliance on a more limited rationalethe reluctance of judges and juries actually to impose the death penalty in the majority of capital *466 casesjoin in the judgments in these cases. Whatever its precise rationale, today's holding necessarily brings into sharp relief the fundamental question of the role of judicial review in a democratic society. How can government by the elected representatives of the people co-exist with the power of the federal judiciary, whose members are constitutionally insulated from responsiveness to the popular will, to declare invalid laws duly enacted by the popular branches of government?
The answer, of course, is found in Hamilton's Federalist Paper No. 78 and in Chief Justice Marshall's classic opinion in Marbury v. Madison, 1 Cranch 137 (1803). An oft-told story since then, it bears summarization once more. Sovereignty resides ultimately in the people as a whole and, by adopting through their States a written Constitution for the Nation and subsequently adding amendments to that instrument, they have both granted certain powers to the National Government, and denied other powers to the National and the State Governments. Courts are exercising no more than the judicial function conferred upon them by Art. III of the Constitution when they assess, in a case before them, whether or not a particular legislative enactment is within the authority granted by the Constitution to the enacting body, and whether it runs afoul of some limitation placed by the Constitution on the authority of that body. For the theory is that the people themselves have spoken in the Constitution, and therefore its commands are superior to the commands of the legislature, which is merely an agent of the people.
The Founding Fathers thus wisely sought to have the best of both worlds, the undeniable benefits of both democratic self-government and individual rights protected against possible excesses of that form of government.
The courts in cases properly before them have been entrusted under the Constitution with the last word, short of constitutional amendment, as to whether a law passed *467 by the legislature conforms to the Constitution. But just because courts in general, and this Court in particular, do have the last word, the admonition of Mr. Justice Stone dissenting in United States v. Butler must be constantly borne in mind:
"[W]hile unconstitutional exercise of power by the executive and legislative branches of the government is subject to judicial restraint, the only check upon our own exercise of power is our own sense of self-restraint." 297 U.S. 1, 78-79 (1936).
Rigorous attention to the limits of this Court's authority is likewise enjoined because of the natural desire that beguiles judges along with other human beings into imposing their own views of goodness, truth, and justice upon others. Judges differ only in that they have the power, if not the authority, to enforce their desires. This is doubtless why nearly two centuries of judicial precedent from this Court counsel the sparing use of that power. The most expansive reading of the leading constitutional cases does not remotely suggest that this Court has been granted a roving commission, either by the Founding Fathers or by the framers of the Fourteenth Amendment, to strike down laws that are based upon notions of policy or morality suddenly found unacceptable by a majority of this Court. The Framers of the Constitution would doubtless have agreed with the great English political philosopher John Stuart Mill when he observed:
"The disposition of mankind, whether as rulers or as fellow-citizens, to impose their own opinions and inclinations as a rule of conduct on others, is so energetically supported by some of the best and by some of the worst feelings incident to human nature, that it is hardly ever kept under restraint by anything but want of power." On Liberty 28 (1885).
*468 A separate reason for deference to the legislative judgment is the consequence of human error on the part of the judiciary with respect to the constitutional issue before it. Human error there is bound to be, judges being men and women, and men and women being what they are. But an error in mistakenly sustaining the constitutionality of a particular enactment, while wrongfully depriving the individual of a right secured to him by the Constitution, nonetheless does so by simply letting stand a duly enacted law of a democratically chosen legislative body. The error resulting from a mistaken upholding of an individual's constitutional claim against the validity of a legislative enactment is a good deal more serious. For the result in such a case is not to leave standing a law duly enacted by a representative assembly, but to impose upon the Nation the judicial fiat of a majority of a court of judges whose connection with the popular will is remote at best.
The task of judging constitutional cases imposed by Art. III cannot for this reason be avoided, but it must surely be approached with the deepest humility and genuine deference to legislative judgment. Today's decision to invalidate capital punishment is, I respectfully submit, significantly lacking in those attributes. For the reasons well stated in the opinions of THE CHIEF JUSTICE, MR. JUSTICE BLACKMUN, and MR. JUSTICE POWELL, I conclude that this decision holding unconstitutional capital punishment is not an act of judgment, but rather an act of will. It completely ignores the strictures of Mr. Justice Holmes, writing more than 40 years ago in Baldwin v. Missouri:
"I have not yet adequately expressed the more than anxiety that I feel at the ever increasing scope given to the Fourteenth Amendment in cutting down what I believe to be the constitutional rights of the States. As the decisions now stand, I see hardly *469 any limit but the sky to the invalidating of those rights if they happen to strike a majority of this Court as for any reason undesirable. I cannot believe that the Amendment was intended to give us carte blanche to embody our economic or moral beliefs in its prohibitions. Yet I can think of no narrower reason that seems to me to justify the present and the earlier decisions to which I have referred. Of course the words `due process of law,' if taken in their literal meaning, have no application to this case; and while it is too late to deny that they have been given a much more extended and artificial signification, still we ought to remember the great caution shown by the Constitution in limiting the power of the States, and should be slow to construe the clause in the Fourteenth Amendment as committing to the Court, with no guide but the Court's own discretion, the validity of whatever laws the States may pass." 281 U.S. 586, 595 (1930) (dissenting opinion).
More than 20 years ago, Justice Jackson made a similar observation with respect to this Court's restriction of the States in the enforcement of their own criminal laws:
"The use of the due process clause to disable the States in protection of society from crime is quite as dangerous and delicate a use of federal judicial power as to use it to disable them from social or economic experimentation." Ashcraft v. Tennessee, 322 U.S. 143, 174 (1944) (dissenting opinion).
If there can be said to be one dominant theme in the Constitution, perhaps more fully articulated in the Federalist Papers than in the instrument itself, it is the notion of checks and balances. The Framers were well aware of the natural desire of office holders as well as others to seek to expand the scope and authority of their *470 particular office at the expense of others. They sought to provide against success in such efforts by erecting adequate checks and balances in the form of grants of authority to each branch of the government in order to counteract and prevent usurpation on the part of the others.
This philosophy of the Framers is best described by one of the ablest and greatest of their number, James Madison, in Federalist No. 51:
"In framing a government which is to be administered by men over men, the great difficulty lies in this: You must first enable the government to controul the governed; and in the next place, oblige it to control itself."
Madison's observation applies to the Judicial Branch with at least as much force as to the Legislative and Executive Branches. While overreaching by the Legislative and Executive Branches may result in the sacrifice of individual protections that the Constitution was designed to secure against action of the State, judicial over-reaching may result in sacrifice of the equally important right of the people to govern themselves. The Due Process and Equal Protection Clauses of the Fourteenth Amendment were "never intended to destroy the States' power to govern themselves." Black, J., in Oregon v. Mitchell, 400 U.S. 112, 126 (1970).
The very nature of judicial review, as pointed out by Justice Stone in his dissent in the Butler case, makes the courts the least subject to Madisonian check in the event that they shall, for the best of motives, expand judicial authority beyond the limits contemplated by the Framers. It is for this reason that judicial self-restraint is surely an implied, if not an expressed, condition of the grant of authority of judicial review. The Court's holding in these cases has been reached, I believe, in complete disregard of that implied condition.
| I join the respective opinions of THE CHIEF JUSTICE, MR. JUSTICE POWELL, and MR. JUSTICE REHNQUIST, and add only the following, somewhat personal, comments. 1. Cases such as these provide for me an excruciating agony of the spirit. I yield to no one in the depth of my distaste, antipathy, and, indeed, abhorrence, for the death penalty, with all its aspects of physical distress and fear and of moral judgment exercised by finite minds. That distaste is buttressed by a belief that capital punishment serves no useful purpose that can be demonstrated. For me, it violates childhood's training and life's experiences, and is not compatible *406 with the philosophical convictions I have been able to develop. It is antagonistic to any sense of "reverence for life." Were I a legislator, I would vote against the death penalty for the policy reasons argued by counsel for the respective petitioners and expressed and adopted in the several opinions filed by the Justices who vote to reverse these judgments. 2. Having lived for many years in a State that does not have the death penalty,[1] that effectively abolished it in 1911,[2] and that carried out its last execution on February 13, 1906,[3] capital punishment had never been a part of life for me. In my State, it just did not exist. So far as I can determine, the State, purely from a statistical deterrence point of view, was neither the worse nor the better for its abolition, for, as the concurring opinions observe, the statistics prove little, if anything. But the State and its citizens accepted the fact that the death penalty was not to be in the arsenal of possible punishments for any crime. 3. I, perhaps alone among the present members of the Court, am on judicial record as to this. As a member of the United Court of Appeals, I first struggled silently with the issue of capital punishment in cert. denied, The defendant in that case may have been one of the last to be executed under federal auspices. I struggled again with the issue, and once more refrained from comment, in my writing for an en banc court in vacated ) and remanded, Finally, in Maxwell vacated and remanded, sua sponte, by the Court on grounds not raised below, I revealed, solitarily and not for the panel, my distress and -154.[4] And in I had no hesitancy in writing a panel opinion that held the use of the strap by trusties upon fellow Arkansas prisoners to be a violation of the Eighth Amendment. That, however, was in-prison punishment imposed by inmate-foremen. 4. The several concurring opinions acknowledge, as they must, that until today capital punishment was accepted and assumed as not unconstitutional per se under the Eighth Amendment or the Fourteenth Amendment. This is either the flat or the implicit holding of a unanimous Court in in 1879; of a unanimous Court in In re in 1890; of the Court in in 1910; of all those members of the Court, a majority, who addressed the issue in Louisiana ex rel. in 1947; of Mr. Chief Justice Warren, speaking for himself and three others (Justices Black, DOUGLAS, *408 and Whittaker) in in 1958;[5] in the denial of certiorari in in 1963 (where, however, JUSTICES DOUGLAS, BRENNAN, and Goldberg would have heard argument with respect to the imposition of the ultimate penalty on a convicted rapist who had "neither taken nor endangered human life"); and of Mr. Justice Black in decided only last Term on May 3, 1971.[6] Suddenly, however, the course of decision is now the opposite way, with the Court evidently persuaded that somehow the passage of time has taken us to a place of greater maturity and outlook. The argument, plausible and high-sounding as it may be, is not persuasive, for it is only one year since McGautha, only eight and one-half years since Rudolph, 14 years since Trop, and 25 years since Francis, and we have been presented with nothing that demonstrates a significant movement of any kind in these brief periods. The Court has just decided that it is time to strike down the death penalty. There would have been as much reason to do this *409 when any of the cited cases were decided. But the Court refrained from that action on each of those occasions. The Court has recognized, and I certainly subscribe to the proposition, that the Cruel and Unusual Punishments Clause "may acquire meaning as public opinion becomes enlightened by a humane justice." And Mr. Chief Justice Warren, for a plurality of the Court, referred to "the evolving standards of decency that mark the progress of a maturing society." Mr. Jefferson expressed the same thought well.[7] *410 My problem, however, as I have indicated, is the suddenness of the Court's perception of progress in the human attitude since decisions of only a short while ago. 5. To reverse the judgments in these cases is, of course, the easy choice. It is easier to strike the balance in favor of life and against death. It is comforting to relax in the thoughtsperhaps the rationalizations that this is the compassionate decision for a maturing society; that this is the moral and the "right" thing to do; that thereby we convince ourselves that we are moving down the road toward human decency; that we value life even though that life has taken another or others or has grievously scarred another or others and their families; and that we are less barbaric than we were in 1879, or in 1890, or in 1910, or in 1947, or in 1958, or in 1963, or a year ago, in 1971, when Wilkerson, Weems, Francis, Trop, Rudolph, and McGautha were respectively decided. This, for me, is good argument, and it makes some sense. But it is good argument and it makes sense only in a legislative and executive way and not as a judicial expedient. As I have said above, were I a legislator, I would do all I could to sponsor and to vote for legislation abolishing the death penalty. And were I the chief executive of a sovereign State, I would be sorely tempted to exercise executive clemency as Governor Rockefeller of Arkansas did recently just before he departed from office. Thereon the Legislative Branch of the State or Federal Government, and secondarily, on the Executive Branchis where the authority and responsibility for this kind of action lies. The authority should not be taken over by the judiciary in the modern guise of an Eighth Amendment issue. I do not sit on these cases, however, as a legislator, responsive, at least in part, to the will of constituents. *411 Our task here, as must so frequently be emphasized and re-emphasized, is to pass upon the constitutionality of legislation that has been enacted and that is challenged. This is the sole task for judges. We should not allow our personal preferences as to the wisdom of legislative and congressional action, or our distaste for such action, to guide our judicial decision in cases such as these. The temptations to cross that policy line are very great. In fact, as today's decision reveals, they are almost irresistible. 6. The Court, in my view, is somewhat propelled toward its result by the interim decision of the Supreme Court, with one justice dissenting, that the death penalty is violative of that State's constitution. So far as I am aware, that was the first time the death penalty in its entirety has been nullified by judicial decision. Cf. cert. denied, post, p. 942. 's moral problem was a profound one, for more prisoners were on death row there than in any other State. of course, has the right to construe its constitution as it will. Its construction, however, is hardly a precedent for federal adjudication. 7. I trust the Court fully appreciates what it is doing when it decides these cases the way it does today. Not only are the capital punishment laws of 39 and the District of Columbia struck down, but also all those provisions of the federal statutory structure that permit the death penalty apparently are voided. No longer is capital punishment possible, I suspect, for, among other crimes, treason, 18 U.S. C. 2381; or assassination of the President, the Vice President, or those who stand elected to those positions, 18 U.S. C. 1751; or assassination of a Member or member-elect of Congress, 18 U.S. C. 351; or espionage, 18 U.S. C. 794; *412 or rape within the special maritime jurisdiction, 18 U.S. C. 2031; or aircraft or motor vehicle destruction where death occurs, 18 U.S. C. 34; or explosives offenses where death results, 18 U.S. C. 844 (d) and (f); or train wrecking, 18 U.S. C. 12; or aircraft piracy, 49 U.S. C. 1472 (i). Also in jeopardy, perhaps, are the death penalty provisions in various Articles of the Uniform Code of Military Justice. 10 U.S. C. 885, 890, 894, 8, 901, 904, 906, 913, 918, and 920. All these seem now to be discarded without a passing reference to the reasons, or the circumstances, that prompted their enactment, some very recent, and their retention in the face of efforts to repeal them. 8. It is of passing interest to note a few voting facts with respect to recent federal death penalty legislation: A. The aircraft piracy statute, 49 U.S. C. 1472 (i), was enacted September 5, 1961. The Senate vote on August 10 was 92-0. It was announced that Senators Chavez, Fulbright, Neuberger, and Symington were absent but that, if present, all four would vote yea. It was also announced, on the other side of the aisle, that Senator Butler was ill and that Senators Beall, Carlson, and Morton were absent or detained, but that those four, if present, would vote in the affirmative. These announcements, therefore, indicate that the true vote was 100-0. 107 Cong. Rec. 15440. The House passed the bill without recorded vote. 107 Cong. Rec. 16849. B. The presidential assassination statute, 18 U.S. C. 1751, was approved August 28, 1965, without recorded votes. 111 Cong. Rec. 14103, 18026, and 20239. C. The Omnibus Crime Control Act of was approved January 2, 1971. Title IV thereof added the congressional assassination statute that is now 18 U.S. C. 351. The recorded House vote on October 7, was 341-26, with 63 not voting and 62 of those paired. 116 Cong. Rec. 35363-35364. The Senate vote on October 8 *413 was 59-0, with 41 not voting, but with 21 of these announced as favoring the bill. 116 Cong. Rec. 35743. Final votes after conference were not recorded. 116 Cong. Rec. 42150, 421. It is impossible for me to believe that the many lawyer-members of the House and Senateincluding, I might add, outstanding leaders and prominent candidates for higher officewere callously unaware and insensitive of constitutional overtones in legislation of this type. The answer, of course, is that in 1961, in 1965, and in these elected representatives of the peoplefar more conscious of the temper of the times, of the maturing of society, and of the contemporary demands for man's dignity, than are we who sit cloistered on this Court took it as settled that the death penalty then, as it always had been, was not in itself unconstitutional. Some of those Members of Congress, I suspect, will be surprised at this Court's giant stride today. 9. If the reservations expressed by my Brother STEWART (which, as I read his opinion, my Brother WHITE shares) were to command support, namely, that capital punishment may not be unconstitutional so long as it be mandatorily imposed, the result, I fear, will be that statutes struck down today will be re-enacted by state legislatures to prescribe the death penalty for specified crimes without any alternative for the imposition of a lesser punishment in the discretion of the judge or jury, as the case may be. This approach, it seems to me, encourages legislation that is regressive and of an antique mold, for it eliminates the element of mercy in the imposition of punishment. I thought we had passed beyond that point in our criminology long ago. 10. It is not without interest, also, to note that, although the several concurring opinions acknowledge the heinous and atrocious character of the offenses committed by the petitioners, none of those opinions makes *414 reference to the misery the petitioners' crimes occasioned to the victims, to the families of the victims, and to the communities where the offenses took place. The arguments for the respective petitioners, particularly the oral arguments, were similarly and curiously devoid of reference to the victims. There is risk, of course, in a comment such as this, for it opens one to the charge of emphasizing the retributive. But see Nevertheless, these cases are here because offenses to innocent victims were perpetrated. This fact, and the terror that occasioned it, and the fear that stalks the streets of many of our cities today perhaps deserve not to be entirely overlooked. Let us hope that, with the Court's decision, the terror imposed will be forgotten by those upon whom it was visited, and that our society will reap the hoped-for benefits of magnanimity. Although personally I may rejoice at the Court's result, I find it difficult to accept or to justify as a matter of history, of law, or of constitutional pronouncement. I fear the Court has overstepped. It has sought and has achieved an end. MR. JUSTICE POWELL, with whom THE CHIEF JUSTICE, MR. JUSTICE BLACKMUN, and MR. JUSTICE REHNQUIST join, dissenting. The Court granted certiorari in these cases to consider whether the death penalty is any longer a permissible form of punishment. It is the judgment of five Justices that the death penalty, as customarily prescribed and implemented in this country today, offends the constitutional prohibition against cruel and unusual punishments. The reasons for that judgment are stated in five separate opinions, expressing as many separate rationales. In my view, none of these opinions provides a constitutionally adequate foundation for the Court's decision. *415 MR. JUSTICE DOUGLAS concludes that capital punishment is incompatible with notions of "equal protection" that he finds to be "implicit" in the Eighth Amendment. Ante, at 257. MR. JUSTICE BRENNAN bases his judgment primarily on the thesis that the penalty "does not comport with human dignity." Ante, at 270. MR. JUSTICE STEWART concludes that the penalty is applied in a "wanton" and "freakish" manner. Ante, at 310. For MR. JUSTICE WHITE it is the "infrequency" with which the penalty is imposed that renders its use unconstitutional. Ante, at 313. MR. JUSTICE MARSHALL finds that capital punishment is an impermissible form of punishment because it is "morally unacceptable" and "excessive." Ante, at 360, 358. Although the central theme of petitioners' presentations in these cases is that the imposition of the death penalty is per se unconstitutional, only two of today's opinions explicitly conclude that so sweeping a determination is mandated by the Constitution. Both MR. JUSTICE BRENNAN and MR. JUSTICE MARSHALL call for the abolition of all existing state and federal capital punishment statutes. They intimate as well that no capital statute could be devised in the future that might comport with the Eighth Amendment. While the practical consequences of the other three opinions are less certain, they at least do not purport to render impermissible every possible statutory scheme for the use of capital punishment that legislatures might hereafter devise.[1] Insofar as these latter opinions fail, at least explicitly, *416 to go as far as petitioners' contentions would carry them, their reservations are attributable to a willingness to accept only a portion of petitioners' thesis. For the reasons cogently set out in the CHIEF JUSTICE'S dissenting opinion (ante, at 396-403), and for reasons stated elsewhere in this opinion, I find my Brothers' less-than-absolute-abolition judgments unpersuasive. Because those judgments are, for me, not dispositive, I shall focus primarily on the broader ground upon which the petitions in these cases are premised. The foundations of my disagreement with that broader thesis are equally applicable to each of the concurring opinions. I will therefore, not endeavor to treat each one separately. Nor will I attempt to predict what forms of capital statutes, if any, may avoid condemnation in the future under the variety of views expressed by the collective majority today. That difficult task, not performed in any of the controlling opinions, must go unanswered until other cases presenting these more limited inquiries arise. Whatever uncertainties may hereafter surface, several of the consequences of today's decision are unmistakably clear. The decision is plainly one of the greatest importance. *417 The Court's judgment removes the death sentences previously imposed on some 600 persons awaiting punishment in state and federal prisons throughout the country. At least for the present, it also bars the and the Federal Government from seeking sentences of death for defendants awaiting trial on charges for which capital punishment was heretofore a potential alternative. The happy event for these countable few constitutes, however, only the most visible consequence of this decision. Less measurable, but certainly of no less significance, is the shattering effect this collection of views has on the root principles of stare decisis, federalism, judicial restraint andmost importantly separation of powers. The Court rejects as not decisive the clearest evidence that the Framers of the Constitution and the authors of the Fourteenth Amendment believed that those documents posed no barrier to the death penalty. The Court also brushes aside an unbroken line of precedent reaffirming the heretofore virtually unquestioned constitutionality of capital punishment. Because of the pervasiveness of the constitutional ruling sought by petitioners, and accepted in varying degrees by five members of the Court, today's departure from established precedent invalidates a staggering number of state and federal laws. The capital punishment laws of no less than 39 [2] and the District of Columbia are nullified. In addition, numerous provisions of the Criminal Code of the United and of the Uniform Code of Military *418 Justice also are voided. The Court's judgment not only wipes out laws presently in existence, but denies to Congress and to the legislatures of the 50 the power to adopt new policies contrary to the policy selected by the Court. Indeed, it is the view of two of my Brothers that the people of each State must be denied the prerogative to amend their constitutions to provide for capital punishment even selectively for the most heinous crime. In terms of the constitutional role of this Court, the impact of the majority's ruling is all the greater because the decision encroaches upon an area squarely within the historic prerogative of the legislative branchboth state and federalto protect the citizenry through the designation of penalties for prohibitable conduct. It is the very sort of judgment that the legislative branch is competent to make and for which the judiciary is ill-equipped. Throughout our history, Justices of this Court have emphasized the gravity of decisions invalidating legislative judgments, admonishing the nine men who sit on this bench of the duty of self-restraint, especially when called upon to apply the expansive due process and cruel and unusual punishment rubrics. I can recall no case in which, in the name of deciding constitutional questions, this Court has subordinated national and local democratic processes to such an extent. Before turning to address the thesis of petitioners' case against capital punishmenta thesis that has proved, at least in large measure, persuasive to a majority of this Court I first will set out the principles that counsel against the Court's sweeping decision. I The Constitution itself poses the first obstacle to petitioners' argument that capital punishment is per se unconstitutional. The relevant provisions are the Fifth, *419 Eighth, and Fourteenth Amendments. The first of these provides in part: "No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury ; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor be deprived of life, liberty, or property, without due process of law" Thus, the Federal Government's power was restricted in order to guarantee those charged with crimes that the prosecution would have only a single opportunity to seek imposition of the death penalty and that the death penalty could not be exacted without due process and a grand jury indictment. The Fourteenth Amendment, adopted about 77 years after the Bill of Rights, imposed the due process limitation of the Fifth Amendment upon the ' power to authorize capital punishment. The Eighth Amendment, adopted at the same time as the Fifth, proscribes "cruel and unusual" punishments. In an effort to discern its meaning, much has been written about its history in the opinions of this Court and elsewhere.[3] That history need not be restated here since, whatever punishments the Framers of the Constitution may have intended to prohibit under the "cruel and unusual" language, there cannot be the slightest doubt that they intended no absolute bar on the Government's authority to impose the death penalty. As much is made clear by the three references to capital punishment in the Fifth Amendment. Indeed, the same body that proposed the Eighth Amendment also provided, in the first Crimes Act of 1790, for the death penalty for a number of offenses. Of course, the specific prohibitions within the Bill of Rights are limitations on the exercise of power; they are not an affirmative grant of power to the Government. I, therefore, do not read the several references to capital punishment as foreclosing this Court from considering whether the death penalty in a particular case offends the Eighth and Fourteenth Amendments. Nor are "cruel and unusual punishments" and "due process of law" static concepts whose meaning and scope were sealed at the time of their writing. They were designed to be dynamic and to gain meaning through application to specific circumstances, many of which were not contemplated by their authors. While flexibility in the application of these broad concepts is one of the hallmarks of our system of government, the Court is not free to read into the Constitution a meaning that is plainly at variance with its language. Both the language of the Fifth and Fourteenth Amendments and the history of the Eighth Amendment confirm beyond doubt that the death penalty was considered to be a constitutionally permissible punishment. It is, however, within the historic process of constitutional adjudication to challenge the imposition of the death penalty in some barbaric manner or as a penalty wholly disproportionate to a particular criminal act. And in making such a judgment in a case before it, a court may consider contemporary standards to the extent they are relevant. While this weighing of a punishment against the Eighth Amendment standard on a case-by-case basis is consonant with history and precedent, it is not what *421 petitioners demand in these cases. They seek nothing less than the total abolition of capital punishment by judicial fiat. II Petitioners assert that the constitutional issue is an open one uncontrolled by prior decisions of this Court. They view the several cases decided under the Eighth Amendment as assuming the constitutionality of the death penalty without focusing squarely upon the issue. I do not believe that the case law can be so easily cast aside. The Court on numerous occasions has both assumed and asserted the constitutionality of capital punishment. In several cases that assumption provided a necessary foundation for the decision, as the issue was whether a particular means of carrying out a capital sentence would be allowed to stand. Each of those decisions necessarily was premised on the assumption that some method of exacting the penalty was permissible. The issue in the first capital case in which the Eighth Amendment was invoked, was whether carrying out a death sentence by public shooting was cruel and unusual punishment. A unanimous Court upheld that form of execution, noting first that the punishment itself, as distinguished from the mode of its infliction, was "not pretended by the counsel of the prisoner" (id., at 137) to be cruel and unusual. The Court went on to hold that: "Cruel and unusual punishments are forbidden by the Constitution, but the authorities are quite sufficient to show that the punishment of shooting as a mode of executing the death penalty for the crime of murder in the first degree is not included in that category" at Eleven years later, in In re the Court again faced a question involving the *422 method of carrying out a capital sentence. On review of a denial of habeas corpus relief by the Supreme Court of New York, this Court was called on to decide whether electrocution, which only very recently had been adopted by the New York Legislature as a means of execution, was impermissibly cruel and unusual in violation of the Fourteenth Amendment.[4] Chief Justice Fuller, speaking for the entire Court, ruled in favor of the State. Electrocution had been selected by the legislature, after careful investigation, as "the most humane and practical method known to modern science of carrying into effect the sentence of death." The Court drew a clear line between the penalty itself and the mode of its execution: "Punishments are cruel when they involve torture or a lingering death; but the punishment of death *423 is not cruel, within the meaning of that word as used in the Constitution. It implies there something inhuman and barbarous, something more than the mere extinguishment of life." at More than 50 years later, in Louisiana ex rel. the Court considered a case in which, due to a mechanical malfunction, Louisiana's initial attempt to electrocute a convicted murderer had failed. Petitioner sought to block a second attempt to execute the sentence on the ground that to do so would constitute cruel and unusual punishment. In the plurality opinion written by Mr. Justice Reed, concurred in by Chief Justice Vinson and Justices Black and Jackson, relief was denied. Again the Court focused on the manner of execution, never questioning the propriety of the death sentence itself. "The case before us does not call for an examination into any punishments except that of death. The traditional humanity of modern Anglo-American law forbids the infliction of unnecessary pain in the execution of the death sentence. ". The cruelty against which the Constitution protects a convicted man is cruelty inherent in the method of punishment, not the necessary suffering involved in any method employed to extinguish life humanely." Mr. Justice Frankfurter, unwilling to dispose of the case under the Eighth Amendment's specific prohibition, approved the second execution attempt under the Due Process Clause. He concluded that "a State may be found to deny a person due process by treating even one guilty of crime in a manner that violates standards of *424 decency more or less universally accepted though not when it treats him by a mode about which opinion is fairly divided." The four dissenting Justices, although finding a second attempt at execution to be impermissibly cruel, expressly recognized the validity of capital punishment: "In determining whether the proposed procedure is unconstitutional, we must measure it against a lawful electrocution. Electrocution, when instantaneous, can be inflicted by a state in conformity with due process of law. "The all-important consideration is that the execution shall be so instantaneous and substantially painless that the punishment shall be reduced, as nearly as possible, to no more than that of death itself." Each of these cases involved the affirmance of a death sentence where its validity was attacked as violating the Eighth Amendment. Five opinions were written in these three cases, expressing the views of 23 Justices. While in the narrowest sense it is correct to say that in none was there a frontal attack upon the constitutionality of the death penalty, each opinion went well beyond an unarticulated assumption of validity. The power of the to impose capital punishment was repeatedly and expressly recognized. In addition to these cases in which the constitutionality of the death penalty was a necessary foundation for the decision, those who today would have this Court undertake the absolute abolition of the death penalty also must reject the opinions of other cases stipulating or assuming the constitutionality of capital punishment. 100 ; *425 (White, J., joined by Holmes, J., dissenting).[5] See also 402 U. S., at ; Robinson v. The plurality opinion in is of special interest since it is this opinion, in large measure, that provides the foundation for the present attack on the death penalty.[6] It is anomalous that the standard urged by petitioners"evolving standards of decency that mark the progress of a maturing society" ()should be derived from an opinion that so unqualifiedly rejects their arguments. Chief Justice Warren, joined by Justices Black, DOUGLAS, and Whittaker, stated flatly: "At the outset, let us put to one side the death penalty as an index of the constitutional limit on punishment. Whatever the arguments may be against capital punishment, both on moral grounds and in terms of accomplishing the purposes of punishment and they are forcefulthe death penalty has been employed throughout our history, and, in a day when it is still widely accepted, it cannot be said to violate the constitutional concept of cruelty." at The issue in Trop was whether forfeiture of citizenship was a cruel and unusual punishment when imposed on *426 a wartime deserter who had gone "over the hill" for less than a day and had willingly surrendered. In examining the consequences of the relatively novel punishment of denationalization,[7] Chief Justice Warren drew a line between "traditional" and "unusual" penalties: "While the State has the power to punish, the [Eighth] Amendment stands to assure that this power be exercised within the limits of civilized standards. Fines, imprisonment and even execution may be imposed depending upon the enormity of the crime, but any technique outside the bounds of these traditional penalties is constitutionally suspect." The plurality's repeated disclaimers of any attack on capital punishment itself must be viewed as more than offhand dicta since those views were written in direct response to the strong language in Mr. Justice Frankfurter's dissent arguing that denationalization could not be a disproportionate penalty for a concededly capital offense.[8] The most recent precedents of this and supraare also premised to a significant degree on the constitutionality of the death penalty. While the scope of review in both cases was limited to questions involving the procedures for selecting juries *427 and regulating their deliberations in capital cases,[9] those opinions were "singularly academic exercise[s]"[10] if the members of this Court were prepared at those times to find in the Constitution the complete prohibition of the death penalty. This is especially true of Mr. Justice Harlan's opinion for the Court in McGautha, in which, after a full review of the history of capital punishment, he concluded that "we find it quite impossible to say that committing to the untrammeled discretion of the jury the power to pronounce life or death in capital cases is offensive to anything in the Constitution."[11] *428 Perhaps enough has been said to demonstrate the unswerving position that this Court has taken in opinions spanning the last hundred years. On virtually every occasion that any opinion has touched on the question of the constitutionality of the death penalty, it has been asserted affirmatively, or tacitly assumed, that the Constitution does not prohibit the penalty. No Justice of the Court, until today, has dissented from this consistent reading of the Constitution. The petitioners in these cases now before the Court cannot fairly avoid the weight of this substantial body of precedent merely by asserting that there is no prior decision precisely in point. Stare decisis, if it is a doctrine founded on principle, surely applies where there exists a long line of cases endorsing or necessarily assuming the validity of a particular matter of constitutional interpretation. Green v. United While these oft-repeated expressions of unchallenged belief in the constitutionality of capital punishment may not justify a summary disposition of the constitutional question before us, they are views expressed and joined in over the years by no less than 29 Justices of this Court and therefore merit the greatest respect.[12] Those who now resolve to set those views aside indeed have a heavy burden. III Petitioners seek to avoid the authority of the foregoing cases, and the weight of express recognition in the Constitution itself, by reasoning which will not withstand analysis. The thesis of petitioners' case derives from several opinions in which members of this Court *429 have recognized the dynamic nature of the prohibition against cruel and unusual punishments. The final meaning of those words was not set in 1791. Rather, to use the words of Chief Justice Warren speaking for a plurality of the Court in 356 U. S., -101: "[T]he words of the Amendment are not precise, and their scope is not static. The Amendment must draw its meaning from the evolving standards of decency that mark the progress of a maturing society." But this was not new doctrine. It was the approach to the Eighth Amendment taken by Mr. Justice McKenna in his opinion for the Court in Writing for four Justices sitting as the majority of the six-man Court deciding the case, he concluded that the clause must be "progressive"; it is not "fastened to the obsolete but may acquire meaning as public opinion becomes enlightened by a humane justice." The same test was offered by Mr. Justice Frankfurter in his separate concurrence in Louisiana ex rel. While he rejected the notion that the Fourteenth Amendment made the Eighth Amendment fully applicable to the he nonetheless found as a matter of due process that the were prohibited from "treating even one guilty of crime in a manner that violates standards of decency more or less universally accepted." Whether one views the question as one of due process or of cruel and unusual punishment, as I do for convenience in this case, the issue is essentially the same.[13] The fundamental premise upon which either standard is based is that notions of what constitutes cruel and unusual punishment or due process do evolve. *430 Neither the Congress nor any state legislature would today tolerate pillorying, branding, or cropping or nailing of the earspunishments that were in existence during our colonial era.[14] Should, however, any such punishment be prescribed, the courts would certainly enjoin its execution. See Likewise, no court would approve any method of implementation of the death sentence found to involve unnecessary cruelty in light of presently available alternatives. Similarly, there may well be a process of evolving attitude with respect to the application of the death sentence for particular crimes.[15] See But we are not asked to consider the permissibility of any of the several methods employed in carrying out the death sentence. Nor are we asked, at least as part of the core submission in these cases, to determine whether the penalty might be a grossly excessive punishment for some specific criminal conduct. Either inquiry would call for a discriminating evaluation of particular means, or of the relationship between particular conduct and its punishment. Petitioners' principal argument goes far beyond the traditional process of case-by-case inclusion and exclusion. Instead the argument insists on an unprecedented constitutional rule of absolute prohibition of capital punishment for any crime, regardless of its depravity and impact on society. In calling for a precipitate and final judicial end to this form of penalty as offensive to evolving standards of decency, petitioners would have this Court abandon the traditional and more refined approach consistently followed in its prior Eighth Amendment precedents. What they are saying, in effect, is that the evolutionary *431 process has come suddenly to an end; that the ultimate wisdom as to the appropriateness of capital punishment under all circumstances, and for all future generations, has somehow been revealed. The prior opinions of this Court point with great clarity to reasons why those of us who sit on this Court at a particular time should act with restraint before assuming, contrary to a century of precedent, that we now know the answer for all time to come. First, where as here, the language of the applicable provision provides great leeway and where the underlying social policies are felt to be of vital importance, the temptation to read personal preference into the Constitution is understandably great. It is too easy to propound our subjective standards of wise policy under the rubric of more or less universally held standards of decency. See 119-120 (Frankfurter, J., dissenting); Louisiana ex rel. -471 ; -379 The second consideration dictating judicial self-restraint arises from a proper recognition of the respective roles of the legislative and judicial branches. The designation of punishments for crimes is a matter peculiarly within the sphere of the state and federal legislative bodies. See, e. g., In re 136 U. S., at ; When asked to encroach on the legislative prerogative we are well counseled to proceed with the utmost reticence. The review of legislative choices, in the performance of our duty to enforce the Constitution, has been characterized most appropriately by Mr. Justice Holmes as "the gravest and most delicate duty that this Court is called on to perform." *432 How much graver is that duty when we are not asked to pass on the constitutionality of a single penalty under the facts of a single case but instead are urged to overturn the legislative judgments of 40 state legislatures as well as those of Congress. In so doing is the majority able to claim, as did the Court in Weems, that it appreciates "to the fullest the wide range of power that the legislature possesses to adapt its penal laws to conditions as they may exist and punish the crimes of men according to their forms and frequency"? I think not. No more eloquent statement of the essential separation of powers limitation on our prerogative can be found than the admonition of Mr. Justice Frankfurter, dissenting in Trop. His articulation of the traditional view takes on added significance where the Court undertakes to nullify the legislative judgments of the Congress and four-fifths of the "What is always basic when the power of Congress to enact legislation is challenged is the appropriate approach to judicial review of congressional legislation When the power of Congress to pass a statute is challenged, the function of this Court is to determine whether legislative action lies clearly outside the constitutional grant of power to which it has been, or may fairly be, referred. In making this determination, the Court sits in judgment on the action of a co-ordinate branch of the Government while keeping unto itselfas it must under our constitutional systemthe final determination of its own power to act. "Rigorous observance of the difference between limits of power and wise exercise of powerbetween questions of authority and questions of prudencerequires the most alert appreciation of this decisive but subtle relationship of two concepts that too easily coalesce. No less does it require a *433 disciplined will to adhere to the difference. It is not easy to stand aloof and allow want of wisdom to prevail, to disregard one's own strongly held view of what is wise in the conduct of affairs. But it is not the business of this Court to pronounce policy. It must observe a fastidious regard for limitations on its own power, and this precludes the Court's giving effect to its own notions of what is wise or politic. That self-restraint is of the essence in the observance of the judicial oath, for the Constitution has not authorized the judges to sit in judgment on the wisdom of what Congress and the Executive Branch do." -120. See also Mr. Justice White's dissenting opinion in IV Although determining the range of available punishments for a particular crime is a legislative function, the very presence of the Cruel and Unusual Punishments Clause within the Bill of Rights requires, in the context of a specific case, that courts decide whether particular acts of the Congress offend that Amendment. The Due Process Clause of the Fourteenth Amendment imposes on the judiciary a similar obligation to scrutinize state legislation. But the proper exercise of that constitutional obligation in the cases before us today must be founded on a full recognition of the several considerations set forth abovethe affirmative references to capital punishment in the Constitution, the prevailing precedents of this Court, the limitations on the exercise of our power imposed by tested principles of judicial self-restraint, and the duty to avoid encroachment on the powers conferred upon state and federal legislatures. In the face of these considerations, only the most conclusive *434 of objective demonstrations could warrant this Court in holding capital punishment per se unconstitutional. The burden of seeking so sweeping a decision against such formidable obstacles is almost insuperable. Viewed from this perspective, as I believe it must be, the case against the death penalty falls far short. Petitioners' contentions are premised, as indicated above, on the long-accepted view that concepts embodied in the Eighth and Fourteenth Amendments evolve. They present, with skill and persistence, a list of "objective indicators" which are said to demonstrate that prevailing standards of human decency have progressed to the final point of requiring the Court to hold, for all cases and for all time, that capital punishment is unconstitutional. Briefly summarized, these proffered indicia of contemporary standards of decency include the following: (i) a worldwide trend toward the disuse of the death penalty;[16] (ii) the reflection in the scholarly literature of a progressive rejection of capital punishment founded essentially on moral opposition to such treatment;[17] (iii) the decreasing numbers of executions over the last 40 years and especially over the last decade;[18] (iv) the *435 small number of death sentences rendered in relation to the number of cases in which they might have been imposed;[19] and (v) the indication of public abhorrence of *436 the penalty reflected in the circumstances that executions are no longer public affairs.[20] The foregoing is an incomplete summary but it touches the major bases of petitioners' presentation. Although they are not appropriate for consideration as objective evidence, petitioners strongly urge two additional propositions. They contend, first, that the penalty survives public condemnation only through the infrequency, arbitrariness, and discriminatory nature of its application, and second, that there no longer exists any legitimate justification for the utilization of the ultimate penalty. These contentions, which have proved persuasive to several of the Justices constituting the majority, deserve separate consideration and will be considered in the ensuing sections. Before turning to those arguments, I first address the argument based on "objective" factors. Any attempt to discern contemporary standards of decency through the review of objective factors must take into account several overriding considerations which petitioners choose to discount or ignore. In a democracy *437 the first indicator of the public's attitude must always be found in the legislative judgments of the people's chosen representatives. MR. JUSTICE MARSHALL'S opinion today catalogues the salient statistics. Forty[21] the District of Columbia, and the Federal Government still authorize the death penalty for a wide variety of crimes. That number has remained relatively static since the end of World War I. Ante, at 339-341. That does not mean, however, that capital punishment has become a forgotten issue in the legislative arena. As recently as January, 1971, Congress approved the death penalty for congressional assassination. 18 U.S. C. 351. In 1965 Congress added the death penalty for presidential and vice presidential assassinations. 18 U.S. C. 1751. Additionally, the aircraft piracy statute passed in 1961 also carries the death penalty. 49 U.S. C. 1472 (i). MR. JUSTICE BLACKMUN'S dissenting opinion catalogues the impressive ease with which each of these statutes was approved. Ante, at 412-413. On the converse side, a bill proposing the abolition of capital punishment for all federal crimes was introduced in but failed to reach the Senate floor.[22] At the state level, New York, among other has recently undertaken reconsideration of its capital crimes. A law passed in 1965 restricted the use of capital punishment to the crimes of murder of a police officer and murder by a person serving a sentence of life imprisonment. N. Y. Penal Code 125.30 I pause here to state that I am at a loss to understand *438 how those urging this Court to pursue a course of absolute abolition as a matter of constitutional judgment can draw any support from the New York experience. As is also the case with respect to recent legislative activity in Canada[23] and Great Britain,[24] New York's decision to restrict the availability of the death penalty is a product of refined and discriminating legislative judgment, reflecting, not the total rejection of capital punishment as inherently cruel, but a desire to limit it to those circumstances in which legislative judgment deems retention to be in the public interest. No such legislative flexibility is permitted by the contrary course petitioners urge this Court to follow.[25] In addition to the New York experience, a number of other have undertaken reconsideration of capital punishment in recent years. In four the penalty has been put to a vote of the people through public referendaa means likely to supply objective evidence of community standards. In Oregon a referendum seeking abolition of capital punishment failed in 1958 but was subsequently approved in 1964.[26] Two years later the penalty was approved in Colorado by a wide margin.[27]*439 In Massachusetts in in an advisory referendum, the voters there likewise recommended retention of the penalty. In approximately 64% of the voters in Illinois approved the penalty.[28] In addition, the National Commission on Reform of Federal Criminal Laws reports that legislative committees in Massachusetts, Pennsylvania, and Maryland recommended abolition, while committees in New Jersey and Florida recommended retention.[29] The legislative views of other have been summarized by Professor Hugo Bedau in his compilation of sources on capital punishment entitled The Death Penalty in America: "What our legislative representatives think in the two score states which still have the death penalty may be inferred from the fate of the bills to repeal or modify the death penalty filed during recent years in the legislatures of more than half of these states. In about a dozen instances, the bills emerged from committee for a vote. But in none except Delaware did they become law. In those states where these bills were brought to the floor of the legislatures, the vote in most instances wasn't even close."[30] This recent history of activity with respect to legislation concerning the death penalty abundantly refutes the abolitionist position. The second and even more direct source of information *440 reflecting the public's attitude toward capital punishment is the jury. In MR. JUSTICE STEWART, joined by JUSTICES BRENNAN and MARSHALL, characterized the jury's historic function in the sentencing process in the following terms: "[T]he jury is given broad discretion to decide whether or not death is `the proper penalty' in a given case, and a juror's general views about capital punishment play an inevitable role in any such decision. "A man who opposes the death penalty, no less than one who favors it, can make the discretionary judgment entrusted to him by the State and can thus obey the oath he takes as a juror. Guided by neither rule nor standard, a jury that must choose between life imprisonment and capital punishment can do little moreand must do nothing lessthan express the conscience of the community on the ultimate question of life or death." "[O]ne of the most important functions any jury can perform in making such a selection is to maintain a link between contemporary community values and the penal systema link without which the determination of punishment could hardly reflect `the evolving standards of decency that mark the progress of a maturing society.'"[31] Any attempt to discern, therefore, where the prevailing standards of decency lie must take careful account of *441 the jury's response to the question of capital punishment. During the 1960's juries returned in excess of a thousand death sentences, a rate of approximately two per week. Whether it is true that death sentences were returned in less than 10% of the cases as petitioners estimate or whether some higher percentage is more accurate,[32] these totals simply do not support petitioners' assertion at oral argument that "the death penalty is virtually unanimously repudiated and condemned by the conscience of contemporary society."[33] It is also worthy of note that the annual rate of death sentences has remained relatively constant over the last 10 years and that the figure for 127 sentencesis the highest annual total since 1961.[34] It is true that the sentencing rate might be expected to rise, rather than remain constant, when the number of violent crimes increases as it has in this country.[35] And it may be conceded that the constancy in these statistics indicates the unwillingness of juries to demand the ultimate penalty in many cases where it might be imposed. But these considerations fall short of indicating that juries are imposing the death penalty with such rarity as to justify this Court in reading into this circumstance a public rejection of capital punishment.[36] *442 One must conclude, contrary to petitioners' submission, that the indicators most likely to reflect the public's viewlegislative bodies, state referenda and the juries which have the actual responsibilitydo not support the contention that evolving standards of decency require total abolition of capital punishment.[37] Indeed, *443 the weight of the evidence indicates that the public generally has not accepted either the morality or the social merit of the views so passionately advocated by the articulate spokesmen for abolition. But however one may assess the amorphous ebb and flow of public opinion generally on this volatile issue, this type of inquiry lies at the peripherynot the coreof the judicial process in constitutional cases. The assessment of popular opinion is essentially a legislative, not a judicial, function. V Petitioners seek to salvage their thesis by arguing that the infrequency and discriminatory nature of the actual resort to the ultimate penalty tend to diffuse public opposition. We are told that the penalty is imposed exclusively on uninfluential minorities"the poor and powerless, personally ugly and socially unacceptable."[38] It is urged that this pattern of application assures that large segments of the public will be either uninformed or unconcerned and will have no reason to measure the punishment against prevailing moral standards. Implicitly, this argument concedes the unsoundness of petitioners' contention, examined above under Part IV, that objective evidence shows a present and widespread community rejection of the death penalty. It is now said, *444 in effect, not that capital punishment presently offends our citizenry, but that the public would be offended if the penalty were enforced in a nondiscriminatory manner against a significant percentage of those charged with capital crimes, and if the public were thereby made aware of the moral issues surrounding capital punishment. Rather than merely registering the objective indicators on a judicial balance, we are asked ultimately to rest a far-reaching constitutional determination on a prediction regarding the subjective judgments of the mass of our people under hypothetical assumptions that may or may not be realistic. Apart from the impermissibility of basing a constitutional judgment of this magnitude on such speculative assumptions, the argument suffers from other defects. If, as petitioners urge, we are to engage in speculation, it is not at all certain that the public would experience deep-felt revulsion if the were to execute as many sentenced capital offenders this year as they executed in the mid-1930's.[39] It seems more likely that public reaction, rather than being characterized by undifferentiated rejection, would depend upon the facts and circumstances surrounding each particular case. Members of this Court know, from the petitions and appeals that come before us regularly, that brutish and revolting murders continue to occur with disquieting frequency. Indeed, murders are so commonplace *445 in our society that only the most sensational receive significant and sustained publicity. It could hardly be suggested that in any of these highly publicized murder casesthe several senseless assassinations or the too numerous shocking multiple murders that have stained this country's recent historythe public has exhibited any signs of "revulsion" at the thought of executing the convicted murderers. The public outcry, as we all know, has been quite to the contrary. Furthermore, there is little reason to suspect that the public's reaction would differ significantly in response to other less publicized murders. It is certainly arguable that many such murders, because of their senselessness or barbarousness, would evoke a public demand for the death penalty rather than a public rejection of that alternative. Nor is there any rational basis for arguing that the public reaction to any of these crimes would be muted if the murderer were "rich and powerful." The demand for the ultimate sanction might well be greater, as a wealthy killer is hardly a sympathetic figure. While there might be specific cases in which capital punishment would be regarded as excessive and shocking to the conscience of the community, it can hardly be argued that the public's dissatisfaction with the penalty in particular cases would translate into a demand for absolute abolition. In pursuing the foregoing speculation, I do not suggest that it is relevant to the appropriate disposition of these cases. The purpose of the digression is to indicate that judicial decisions cannot be founded on such speculations and assumptions, however appealing they may seem. But the discrimination argument does not rest alone on a projection of the assumed effect on public opinion of more frequent executions. Much also is made of the undeniable fact that the death penalty has a greater impact on the lower economic strata of society, which *446 include a relatively higher percentage of persons of minority racial and ethnic group backgrounds. The argument drawn from this fact is two-pronged. In part it is merely an extension of the speculative approach pursued by petitioners, i. e., that public revulsion is suppressed in callous apathy because the penalty does not affect persons from the white middle class which constitutes the majority in this country. This aspect, however, adds little to the infrequency rationalization for public apathy which I have found unpersuasive. As MR. JUSTICE MARSHALL'S opinion today demonstrates, the argument does have a more troubling aspect. It is his contention that if the average citizen were aware of the disproportionate burden of capital punishment borne by the "poor, the ignorant, and the underprivileged," he would find the penalty "shocking to his conscience and sense of justice" and would not stand for its further use. Ante, at 365-366, 369. This argument, like the apathy rationale, calls for further speculation on the part of the Court. It also illuminates the quicksands upon which we are asked to base this decision. Indeed, the two contentions seem to require contradictory assumptions regarding the public's moral attitude toward capital punishment. The apathy argument is predicated on the assumption that the penalty is used against the less influential elements of society, that the public is fully aware of this, and that it tolerates use of capital punishment only because of a callous indifference to the offenders who are sentenced. MR. JUSTICE MARSHALL'S argument, on the other hand, rests on the contrary assumption that the public does not know against whom the penalty is enforced and that if the public were educated to this fact it would find the punishment intolerable. Ante, at 369. Neither assumption can claim to be an entirely accurate portrayal of public attitude; for some acceptance of capital punishment might be a consequence * of hardened apathy based on the knowledge of infrequent and uneven application, while for others acceptance may grow only out of ignorance. More significantly, however, neither supposition acknowledges what, for me, is a more basic flaw. Certainly the claim is justified that this criminal sanction falls more heavily on the relatively impoverished and underprivileged elements of society. The "have-nots" in every society always have been subject to greater pressure to commit crimes and to fewer constraints than their more affluent fellow citizens. This is, indeed, a tragic byproduct of social and economic deprivation, but it is not an argument of constitutional proportions under the Eighth or Fourteenth Amendment. The same discriminatory impact argument could be made with equal force and logic with respect to those sentenced to prison terms. The Due Process Clause admits of no distinction between the deprivation of "life" and the deprivation of "liberty." If discriminatory impact renders capital punishment cruel and unusual, it likewise renders invalid most of the prescribed penalties for crimes of violence. The root causes of the higher incidence of criminal penalties on "minorities and the poor" will not be cured by abolishing the system of penalties. Nor, indeed, could any society have a viable system of criminal justice if sanctions were abolished or ameliorated because most of those who commit crimes happen to be underprivileged. The basic problem results not from the penalties imposed for criminal conduct but from social and economic factors that have plagued humanity since the beginning of recorded history, frustrating all efforts to create in any country at any time the perfect society in which there are no "poor," no "minorities" and no "underprivileged."[40]*448 The causes underlying this problem are unrelated to the constitutional issue before the Court. Finally, yet another theory for abolishing the death penaltyreflected in varying degrees in each of the concurring opinions todayis predicated on the discriminatory impact argument. Quite apart from measuring the public's acceptance or rejection of the death penalty under the "standards of decency" rationale, MR. JUSTICE DOUGLAS finds the punishment cruel and unusual because it is "arbitrarily" invoked. He finds that "the basic theme of equal protection is implicit" in the Eighth Amendment, and that the Amendment is violated when jury sentencing may be characterized as arbitrary or discriminatory. Ante, at 249. While MR. JUSTICE STEWART does not purport to rely on notions of equal protection, he also rests primarily on what he views to be a history of arbitrariness. Ante, at 309-310.[41] Whatever may be the facts with respect to jury sentencing, this argument calls for a reconsideration of the "standards" aspects of the Court's decision in Although that is the unmistakable thrust of these opinions today, I see no reason to reassess the standards question considered so carefully in Mr. Justice Harlan's opinion for the Court *449 last Term. Having so recently reaffirmed our historic dedication to entrusting the sentencing function to the jury's "untrammeled discretion" (id., ), it is difficult to see how the Court can now hold the entire process constitutionally defective under the Eighth Amendment. For all of these reasons I find little merit in the various discrimination arguments, at least in the several lights in which they have been cast in these cases. Although not presented by any of the petitioners today, a different argument, premised on the Equal Protection Clause, might well be made. If a Negro defendant, for instance, could demonstrate that members of his race were being singled out for more severe punishment than others charged with the same offense, a constitutional violation might be established. This was the contention made in vacated and remanded on other grounds, in which the Eighth Circuit was asked to issue a writ of habeas corpus setting aside a death sentence imposed on a Negro defendant convicted of rape. In that case substantial statistical evidence was introduced tending to show a pronounced disproportion in the number of Negroes receiving death sentences for rape in parts of Arkansas and elsewhere in the South. That evidence was not excluded but was found to be insufficient to show discrimination in sentencing in Maxwell's trial. MR. JUSTICE BLACKMUN, then sitting on the Court of Appeals for the Eighth Circuit. concluded: "The petitioner's argument is an interesting one and we are not disposed to say that it could not have some validity and weight in certain situations. Like the trial court, however we feel that the argument does not have validity and pertinent application to Maxwell's case. *450 "We are not yet ready to condemn and upset the result reached in every case of a Negro rape defendant in the State of Arkansas on the basis of broad theories of social and statistical injustice. "We do not say that there is no ground for suspicion that the death penalty for rape may have been discriminatorily applied over the decades in that large area of states whose statutes provide for it. There are recognizable indicators of this. But improper state practice of the past does not automatically invalidate a procedure of the present." I agree that discriminatory application of the death penalty in the past, admittedly indefensible, is no justification for holding today that capital punishment is invalid in all cases in which sentences were handed out to members of the class discriminated against. But Maxwell does point the way to a means of raising the equal protection challenge that is more consonant with precedent and the Constitution's mandates than the several courses pursued by today's concurring opinions. A final comment on the racial discrimination problem seems appropriate. The possibility of racial bias in the trial and sentencing process has diminished in recent years. The segregation of our society in decades past, which contributed substantially to the severity of punishment for interracial crimes, is now no longer prevalent in this country. Likewise, the day is past when juries do not represent the minority group elements of the community. The assurance of fair trials for all citizens is greater today than at any previous time in our history. Because standards of criminal justice have "evolved" in a manner favorable to the accused, discriminatory imposition of capital punishment is far less likely today than in the past. *451 Petitioner in Branch v. Texas, No. 69-5031, and to a lesser extent the petitioners in the other cases before us today, urge that capital punishment is cruel and unusual because it no longer serves any rational legislative interests. Before turning to consider whether any of the traditional aims of punishment justify the death penalty, I should make clear the context in which I approach this aspect of the cases. First, I find no supportin the language of the Constitution, in its history, or in the cases arising under itfor the view that this Court may invalidate a category of penalties because we deem less severe penalties adequate to serve the ends of penology. While the cases affirm our authority to prohibit punishments that are cruelly inhumane (e. g., U. S., at ; In re 136 U. S., at ), and punishments that are cruelly excessive in that they are disproportionate to particular crimes (see Part I, infra), the precedents of this Court afford no basis for striking down a particular form of punishment because we may be persuaded that means less stringent would be equally efficacious. Secondly, if we were free to question the justifications for the use of capital punishment, a heavy burden would rest on those who attack the legislatures' judgments to prove the lack of rational justifications. This Court has long held that legislative decisions in this area, which lie within the special competency of that branch, are entitled to a presumption of validity. See, e. g., ; Louisiana ex rel. ; -379; In re *452 I come now to consider, subject to the reservations above expressed, the two justifications most often cited for the retention of capital punishment. The concept of retributionthough popular for centuriesis now criticized as unworthy of a civilized people. Yet this Court has acknowledged the existence of a retributive element in criminal sanctions and has never heretofore found it impermissible. In Mr. Justice Black stated that, "Retribution is no longer the dominant objective of the criminal law. Reformation and rehabilitation of offenders have become important goals of criminal jurisprudence." at It is clear, however, that the Court did not reject retribution altogether. The record in that case indicated that one of the reasons why the trial judge imposed the death penalty was his sense of revulsion at the "shocking details of the crime." Although his motivation was clearly retributive, the Court upheld the trial judge's sentence.[42] Similarly, MR. JUSTICE MARSHALL noted in his plurality opinion in that this Court "has never held that anything in the Constitution requires that penal sanctions be designed solely to achieve therapeutic or rehabilitative effects."[43] *453 While retribution alone may seem an unworthy justification in a moral sense, its utility in a system of criminal justice requiring public support has long been recognized. Lord Justice Denning, now Master of the Rolls of the Court of Appeal in England, testified on this subject before the British Royal Commission on Capital Punishment: "Many are inclined to test the efficacy of punishment solely by its value as a deterrent: but this is too narrow a view. Punishment is the way in which society expresses its denunciation of wrong doing: and, in order to maintain respect for law, it is essential that the punishment inflicted for grave crimes should adequately reflect the revulsion felt by the great majority of citizens for them. It is a mistake to consider the objects of punishment as being deterrent or reformative or preventive and nothing else. If this were so, we should not send to prison a man who was guilty of motor manslaughter, but only disqualify him from driving; but would public opinion be content with this? The truth is that some crimes are so outrageous that society insists on adequate punishment, because the wrong-doer deserves it, irrespective of whether it is a deterrent or not."[44] The view expressed by Lord Denning was cited approvingly in the Royal Commission's Report, recognizing "a *454 strong and widespread demand for retribution."[45] MR. JUSTICE STEWART makes much the same point in his opinion today when he concludes that expression of man's retributive instincts in the sentencing process "serves an important purpose in promoting the stability of a society governed by law." Ante, at 308. The view, moreover, is not without respectable support in the jurisprudential literature in this country,[46] despite a substantial body of opinion to the contrary.[47] And it is conceded on all sides that, not infrequently, cases arise that are so shocking or offensive that the public demands the ultimate penalty for the transgressor. Deterrence is a more appealing justification, although opinions again differ widely. Indeed, the deterrence issue lies at the heart of much of the debate between the abolitionists and retentionists.[48] Statistical studies, based primarily on trends in that have abolished the penalty, tend to support the view that the death penalty has not been proved to be a superior deterrent.[49] Some dispute the validity of this conclusion,[50] pointing *455 out that the studies do not show that the death penalty has no deterrent effect on any categories of crimes. On the basis of the literature and studies currently available, I find myself in agreement with the conclusions drawn by the Royal Commission following its exhaustive study of this issue: "The general conclusion which we reach, after careful review of all the evidence we have been able to obtain as to the deterrent effect of capital punishment, may be stated as follows. Prima facie the penalty of death is likely to have a stronger effect as a deterrent to normal human beings than any other form of punishment, and there is some evidence (though no convincing statistical evidence) that this is in fact so. But this effect does not operate universally or uniformly, and there are many offenders on whom it is limited and may often be negligible. It is accordingly important to view this question in a just perspective and not base a penal policy in relation to murder on exaggerated estimates of the uniquely deterrent force of the death penalty."[51] Only recently this Court was called on to consider the deterrence argument in relation to punishment by fines for public drunkenness. The Court was unwilling to strike down the Texas statute on grounds that it lacked a rational foundation. What MR. JUSTICE MARSHALL said there would seem to have equal applicability in this case: "The long-standing and still raging debate over the validity of the deterrence justification for penal sanctions has not reached any sufficiently clear conclusions to permit it to be said that such sanctions are ineffective in any particular context or for any *456 particular group of people who are able to appreciate the consequences of their acts." As I noted at the outset of this section, legislative judgments as to the efficacy of particular punishments are presumptively rational and may not be struck down under the Eighth Amendment because this Court may think that some alternative sanction would be more appropriate. Even if such judgments were within the judicial prerogative, petitioners have failed to show that there exist no justifications for the legislative enactments challenged in these cases.[52] While the evidence and arguments advanced by petitioners might have proved profoundly persuasive if addressed to a legislative body, they do not approach the showing traditionally required before a court declares that the legislature has acted irrationally. I In two of the cases before us today juries imposed sentences of death after convictions for rape.[53] In these cases we are urged to hold that even if capital punishment is permissible for some crimes, it is a cruel and unusual punishment for this crime. Petitioners in these cases rely on the Court's opinions holding that the Eighth Amendment, in addition to prohibiting punishments *457 deemed barbarous and inhumane, also condemns punishments that are greatly disproportionate to the crime charged. This reading of the Amendment was first expressed by Mr. Justice Field in his dissenting opinion in a case in which a defendant charged with a large number of violations of Vermont's liquor laws received a fine in excess of $6,600, or a 54-year jail sentence if the fine was not paid. The majority refused to consider the question on the ground that the Eighth Amendment did not apply to the The dissent, after carefully examining the history of that Amendment and the Fourteenth, concluded that its prohibition was binding on Vermont and that it was directed against "all punishments which by their excessive length or severity are greatly disproportioned to the offences charged."[54] The Court, in adopted Mr. Justice Field's view. The defendant, in Weems, charged with falsifying Government documents, had been sentenced to serve 15 years in cadena temporal, a punishment which included carrying chains at the wrists and ankles and the perpetual loss of the right to vote and hold office. Finding the sentence grossly excessive in length and condition of imprisonment, the Court struck it down. This notion of disproportionalitythat particular sentences may be cruelly excessive for particular crimeshas been cited with approval in more recent decisions of this Court. See Robinson v. ; 356 U. S., ; see also These cases, while providing a rationale for gauging the constitutionality of capital sentences imposed for rape, *458 also indicate the existence of necessary limitations on the judicial function. The use of limiting terms in the various expressions of this test found in the opinionsgrossly excessive, greatly disproportionateemphasizes that the Court's power to strike down punishments as excessive must be exercised with the greatest circumspection. As I have noted earlier, nothing in the history of the Cruel and Unusual Punishments Clause indicates that it may properly be utilized by the judiciary to strike down punishmentsauthorized by legislatures and imposed by juriesin any but the extraordinary case. This Court is not empowered to sit as a court of sentencing review, implementing the personal views of its members on the proper role of penology. To do so is to usurp a function committed to the Legislative Branch and beyond the power and competency of this Court. Operating within these narrow limits, I find it quite impossible to declare the death sentence grossly excessive for all rapes. Rape is widely recognized as among the most serious of violent crimes, as witnessed by the very fact that it is punishable by death in 16 and by life imprisonment in most other[55] The several reasons why rape stands so high on the list of serious crimes are well known: It is widely viewed as the most atrocious of intrusions upon the privacy and dignity of the victim; never is the crime committed accidentally; rarely can it be said to be unpremeditated; *459 often the victim suffers serious physical injury; the psychological impact can often be as great as the physical consequences; in a real sense, the threat of both types of injury is always present.[56] For these reasons, and for the reasons arguing against abolition of the death penalty altogether, the excessiveness rationale provides no basis for rejection of the penalty for rape in all cases. The argument that the death penalty for rape lacks rational justification because less severe punishments might be viewed as accomplishing the proper goals of penology is as inapposite here as it was in considering per se abolition. See Part The state of knowledge with respect to the deterrent value of the sentence for this crime is inconclusive.[57] Moreover, what has been said about the concept of retribution applies with equal force where the crime is rape. There are many cases in which the sordid, heinous nature of a particular crime, demeaning, humiliating, and often physically or psychologically traumatic, will call for public condemnation. In a period in our country's history when the frequency of this crime is increasing alarmingly,[58] it is indeed a grave event for the Court to take from the whatever deterrent and retributive weight the death penalty retains. Other less sweeping applications of the disproportionality concept have been suggested. Recently the Fourth Circuit struck down a death sentence in holding that the death penalty was an appropriate punishment for rape *460 only where life is "endangered." Chief Judge Haynsworth, who joined in the panel's opinion, wrote separately in denying the State of Maryland's petition for rehearing in order to make clear the basis for his joinder. He stated that, for him, the appropriate test was not whether life was endangered, but whether the victim in fact suffered "grievous physical or psychological harm." See It seems to me that both of these tests depart from established principles and also raise serious practical problems. How are those cases in which the victim's life is endangered to be distinguished from those in which no danger is found? The threat of serious injury is implicit in the definition of rape; the victim is either forced into submission by physical violence or by the threat of violence. Certainly that test would provide little comfort for either of the rape defendants in the cases presently before us. Both criminal acts were accomplished only after a violent struggle. Petitioner Jackson held a scissors blade against his victim's neck. Petitioner Branch had less difficulty subduing his 65-year-old victim. Both assailants threatened to kill their victims. See MR. JUSTICE DOUGLAS' opinion, ante, at 252-253. The alternate test, limiting the penalty to cases in which the victim suffers physical or emotional harm, might present even greater problems of application. While most physical effects may be seen and objectively measured, the emotional impact may be impossible to gauge at any particular point in time. The extent and duration of psychological trauma may not be known or ascertainable prior to the date of trial. While I reject each of these attempts to establish specific categories of cases in which the death penalty may be deemed excessive, I view them as groping *461 toward what is for me the appropriate application of the Eighth Amendment. While in my view the disproportionality test may not be used either to strike down the death penalty for rape altogether or to install the Court as a tribunal for sentencing review, that test may find its application in the peculiar circumstances of specific cases. Its utilization should be limited to the rare case in which the death penalty is rendered for a crime technically falling within the legislatively defined class but factually falling outside the likely legislative intent in creating the category. Specific rape cases (and specific homicides as well) can be imagined in which the conduct of the accused would render the ultimate penalty a grossly excessive punishment. Although this case-by-case approach may seem painfully slow and inadequate to those who wish the Court to assume an activist legislative role in reforming criminal punishments, it is the approach dictated both by our prior opinions and by a due recognition of the limitations of judicial power. This approach, rather than the majority's more pervasive and less refined judgment, marks for me the appropriate course under the Eighth Amendment. II I now return to the overriding question in these cases: whether this Court, acting in conformity with the Constitution, can justify its judgment to abolish capital punishment as heretofore known in this country. It is important to keep in focus the enormity of the step undertaken by the Court today. Not only does it invalidate hundreds of state and federal laws, it deprives those jurisdictions of the power to legislate with respect to capital punishment in the future, except in a manner consistent with the cloudily outlined views of those Justices who do not purport to undertake total abolition. *462 Nothing short of an amendment to the United Constitution can reverse the Court's judgments. Meanwhile, all flexibility is foreclosed. The normal democratic process, as well as the opportunities for the several to respond to the will of their people expressed through ballot referenda (as in Massachusetts, Illinois, and Colorado),[59] is now shut off. The sobering disadvantage of constitutional adjudication of this magnitude is the universality and permanence of the judgment. The enduring merit of legislative action is its responsiveness to the democratic process, and to revision and change: mistaken judgments may be corrected and refinements perfected. In England[60] and Canada[61] critical choices were made after studies canvassing all competing views, and in those countries revisions may be made in light of experience.[62] As recently as a presidential commission did consider, as part of an overall study of crime in this country, whether the death penalty should be abolished. *463 The commission's unanimous recommendation was as follows: "The question whether capital punishment is an appropriate sanction is a policy decision to be made by each State. Where it is retained, the types of offenses for which it is available should be strictly limited, and the law should be enforced in an even-handed and nondiscriminatory manner, with procedures for review of death sentences that are fair and expeditious. When a State finds that it cannot administer the penalty in such a manner, or that the death penalty is being imposed but not carried into effect, the penalty should be abandoned."[63] The thrust of the Commission's recommendation, as presently relevant, is that this question "is a policy decision to be made by each State." There is no hint that this decision could or should be made by the judicial branch. The National Commission on Reform of Federal Criminal Laws also considered the capital punishment issue. The introductory commentary of its final report states that "a sharp division [existed] within the Commission on the subject of capital punishment," although a *464 majority favored its abolition.[64] Again, consideration of the question was directed to the propriety of retention or abolition as a legislative matter. There was no suggestion that the difference of opinion existing among commission members, and generally across the country, could or should be resolved in one stroke by a decision of this Court.[65] Similar activity was, before today, evident at the state level with re-evaluation having been undertaken by special legislative committees in some and by public ballot in others.[66] With deference and respect for the views of the Justices who differ, it seems to me that all these studiesboth in this country and elsewheresuggest that, as a matter of policy and precedent, this is a classic case for the exercise of our oft-announced allegiance to judicial restraint. I know of no case in which greater gravity and delicacy have attached to the duty that this Court is called on to perform whenever legislationstate or federalis challenged on constitutional grounds.[67] It seems to me that the sweeping judicial action undertaken today reflects a *465 basic lack of faith and confidence in the democratic process. Many may regret, as I do, the failure of some legislative bodies to address the capital punishment issue with greater frankness or effectiveness. Many might decry their failure either to abolish the penalty entirely or selectively, or to establish standards for its enforcement. But impatience with the slowness, and even the unresponsiveness, of legislatures is no justification for judicial intrusion upon their historic powers. Rarely has there been a more appropriate opportunity for this Court to heed the philosophy of Mr. Justice Oliver Wendell Holmes. As Mr. Justice Frankfurter reminded the Court in Trop: "[T]he whole of [Mr. Justice Holmes'] work during his thirty years of service on this Court should be a constant reminder that the power to invalidate legislation must not be exercised as if, either in constitutional theory or in the art of government, it stood as the sole bulwark against unwisdom or excesses of the moment." MR. JUSTICE REHNQUIST, with whom THE CHIEF JUSTICE, MR. JUSTICE BLACKMUN, and MR. JUSTICE POWELL join, dissenting. The Court's judgments today strike down a penalty that our Nation's legislators have thought necessary since our country was founded. My Brothers DOUGLAS, BRENNAN, and MARSHALL would at one fell swoop invalidate laws enacted by Congress and 40 of the 50 state legislatures, and would consign to the limbo of unconstitutionality under a single rubric penalties for offenses as varied and unique as murder, piracy, mutiny, highjacking, and desertion in the face of the enemy. My Brothers STEWART and WHITE, asserting reliance on a more limited rationalethe reluctance of judges and juries actually to impose the death penalty in the majority of capital *466 casesjoin in the judgments in these cases. Whatever its precise rationale, today's holding necessarily brings into sharp relief the fundamental question of the role of judicial review in a democratic society. How can government by the elected representatives of the people co-exist with the power of the federal judiciary, whose members are constitutionally insulated from responsiveness to the popular will, to declare invalid laws duly enacted by the popular branches of government? The answer, of course, is found in Hamilton's Federalist Paper No. 78 and in Chief Justice Marshall's classic opinion in An oft-told story since then, it bears summarization once more. Sovereignty resides ultimately in the people as a whole and, by adopting through their a written Constitution for the Nation and subsequently adding amendments to that instrument, they have both granted certain powers to the National Government, and denied other powers to the National and the State Governments. Courts are exercising no more than the judicial function conferred upon them by Art. III of the Constitution when they assess, in a case before them, whether or not a particular legislative enactment is within the authority granted by the Constitution to the enacting body, and whether it runs afoul of some limitation placed by the Constitution on the authority of that body. For the theory is that the people themselves have spoken in the Constitution, and therefore its commands are superior to the commands of the legislature, which is merely an agent of the people. The Founding Fathers thus wisely sought to have the best of both worlds, the undeniable benefits of both democratic self-government and individual rights protected against possible excesses of that form of government. The courts in cases properly before them have been entrusted under the Constitution with the last word, short of constitutional amendment, as to whether a law passed *467 by the legislature conforms to the Constitution. But just because courts in general, and this Court in particular, do have the last word, the admonition of Mr. Justice Stone dissenting in United v. Butler must be constantly borne in mind: "[W]hile unconstitutional exercise of power by the executive and legislative branches of the government is subject to judicial restraint, the only check upon our own exercise of power is our own sense of self-restraint." Rigorous attention to the limits of this Court's authority is likewise enjoined because of the natural desire that beguiles judges along with other human beings into imposing their own views of goodness, truth, and justice upon others. Judges differ only in that they have the power, if not the authority, to enforce their desires. This is doubtless why nearly two centuries of judicial precedent from this Court counsel the sparing use of that power. The most expansive reading of the leading constitutional cases does not remotely suggest that this Court has been granted a roving commission, either by the Founding Fathers or by the framers of the Fourteenth Amendment, to strike down laws that are based upon notions of policy or morality suddenly found unacceptable by a majority of this Court. The Framers of the Constitution would doubtless have agreed with the great English political philosopher John Stuart Mill when he observed: "The disposition of mankind, whether as rulers or as fellow-citizens, to impose their own opinions and inclinations as a rule of conduct on others, is so energetically supported by some of the best and by some of the worst feelings incident to human nature, that it is hardly ever kept under restraint by anything but want of power." On Liberty 28 (1885). *468 A separate reason for deference to the legislative judgment is the consequence of human error on the part of the judiciary with respect to the constitutional issue before it. Human error there is bound to be, judges being men and women, and men and women being what they are. But an error in mistakenly sustaining the constitutionality of a particular enactment, while wrongfully depriving the individual of a right secured to him by the Constitution, nonetheless does so by simply letting stand a duly enacted law of a democratically chosen legislative body. The error resulting from a mistaken upholding of an individual's constitutional claim against the validity of a legislative enactment is a good deal more serious. For the result in such a case is not to leave standing a law duly enacted by a representative assembly, but to impose upon the Nation the judicial fiat of a majority of a court of judges whose connection with the popular will is remote at best. The task of judging constitutional cases imposed by Art. III cannot for this reason be avoided, but it must surely be approached with the deepest humility and genuine deference to legislative judgment. Today's decision to invalidate capital punishment is, I respectfully submit, significantly lacking in those attributes. For the reasons well stated in the opinions of THE CHIEF JUSTICE, MR. JUSTICE BLACKMUN, and MR. JUSTICE POWELL, I conclude that this decision holding unconstitutional capital punishment is not an act of judgment, but rather an act of will. It completely ignores the strictures of Mr. Justice Holmes, writing more than 40 years ago in Baldwin v. Missouri: "I have not yet adequately expressed the more than anxiety that I feel at the ever increasing scope given to the Fourteenth Amendment in cutting down what I believe to be the constitutional rights of the As the decisions now stand, I see hardly *469 any limit but the sky to the invalidating of those rights if they happen to strike a majority of this Court as for any reason undesirable. I cannot believe that the Amendment was intended to give us carte blanche to embody our economic or moral beliefs in its prohibitions. Yet I can think of no narrower reason that seems to me to justify the present and the earlier decisions to which I have referred. Of course the words `due process of law,' if taken in their literal meaning, have no application to this case; and while it is too late to deny that they have been given a much more extended and artificial signification, still we ought to remember the great caution shown by the Constitution in limiting the power of the and should be slow to construe the clause in the Fourteenth Amendment as committing to the Court, with no guide but the Court's own discretion, the validity of whatever laws the may pass." More than 20 years ago, Justice Jackson made a similar observation with respect to this Court's restriction of the in the enforcement of their own criminal laws: "The use of the due process clause to disable the in protection of society from crime is quite as dangerous and delicate a use of federal judicial power as to use it to disable them from social or economic experimentation." If there can be said to be one dominant theme in the Constitution, perhaps more fully articulated in the Federalist Papers than in the instrument itself, it is the notion of checks and balances. The Framers were well aware of the natural desire of office holders as well as others to seek to expand the scope and authority of their *470 particular office at the expense of others. They sought to provide against success in such efforts by erecting adequate checks and balances in the form of grants of authority to each branch of the government in order to counteract and prevent usurpation on the part of the others. This philosophy of the Framers is best described by one of the ablest and greatest of their number, James Madison, in Federalist No. 51: "In framing a government which is to be administered by men over men, the great difficulty lies in this: You must first enable the government to controul the governed; and in the next place, oblige it to control itself." Madison's observation applies to the Judicial Branch with at least as much force as to the Legislative and Executive Branches. While overreaching by the Legislative and Executive Branches may result in the sacrifice of individual protections that the Constitution was designed to secure against action of the State, judicial over-reaching may result in sacrifice of the equally important right of the people to govern themselves. The Due Process and Equal Protection Clauses of the Fourteenth Amendment were "never intended to destroy the ' power to govern themselves." Black, J., in The very nature of judicial review, as pointed out by Justice Stone in his dissent in the Butler case, makes the courts the least subject to Madisonian check in the event that they shall, for the best of motives, expand judicial authority beyond the limits contemplated by the Framers. It is for this reason that judicial self-restraint is surely an implied, if not an expressed, condition of the grant of authority of judicial review. The Court's holding in these cases has been reached, I believe, in complete disregard of that implied condition. |
Justice Ginsburg | dissenting | false | Kirtsaeng v. John Wiley & Sons, Inc. | 2013-03-19T00:00:00 | null | https://www.courtlistener.com/opinion/2959744/kirtsaeng-v-john-wiley-sons-inc/ | https://www.courtlistener.com/api/rest/v3/clusters/2959744/ | 2,013 | 2012-025 | 2 | 6 | 3 | “In the interpretation of statutes, the function of the
courts is easily stated. It is to construe the language so as
to give effect to the intent of Congress.” United States v.
American Trucking Assns., Inc., 310 U.S. 534, 542 (1940).
Instead of adhering to the Legislature’s design, the Court
today adopts an interpretation of the Copyright Act at
odds with Congress’ aim to protect copyright owners
against the unauthorized importation of low-priced, foreign
made copies of their copyrighted works. The Court’s bold
departure from Congress’ design is all the more stunning,
for it places the United States at the vanguard of the
movement for “international exhaustion” of copyrights—a
movement the United States has steadfastly resisted on
the world stage.
To justify a holding that shrinks to insignificance copy
right protection against the unauthorized importation of
foreign-made copies, the Court identifies several “practical
problems.” Ante, at 24. The Court’s parade of horribles,
however, is largely imaginary. Congress’ objective in
enacting 17 U.S. C. §602(a)(1)’s importation prohibition
can be honored without generating the absurd conse
quences hypothesized in the Court’s opinion. I dissent
2 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
from the Court’s embrace of “international exhaustion,”
and would affirm the sound judgment of the Court of
Appeals.
I
Because economic conditions and demand for particular
goods vary across the globe, copyright owners have a
financial incentive to charge different prices for copies of
their works in different geographic regions. Their ability
to engage in such price discrimination, however, is under
mined if arbitrageurs are permitted to import copies
from low-price regions and sell them in high-price regions.
The question in this case is whether the unauthorized
importation of foreign-made copies constitutes copyright
infringement under U. S. law.
To answer this question, one must examine three provi
sions of Title 17 of the U. S. Code: §§106(3), 109(a), and
602(a)(1). Section 106 sets forth the “exclusive rights” of a
copyright owner, including the right “to distribute copies
or phonorecords of the copyrighted work to the public by
sale or other transfer of ownership, or by rental, lease, or
lending.” §106(3). This distribution right is limited by
§109(a), which provides: “Notwithstanding the provisions
of section 106(3), the owner of a particular copy or phono-
record lawfully made under this title . . . is entitled,
without the authority of the copyright owner, to sell or
otherwise dispose of the possession of that copy or
phonorecord.” Section 109(a) codifies the “first sale doc
trine,” a doctrine articulated in Bobbs-Merrill Co. v.
Straus, 210 U.S. 339, 349–351 (1908), which held that a
copyright owner could not control the price at which re
tailers sold lawfully purchased copies of its work. The
first sale doctrine recognizes that a copyright owner
should not be permitted to exercise perpetual control over
the distribution of copies of a copyrighted work. At some
point—ordinarily the time of the first commercial sale—
Cite as: 568 U. S. ____ (2013) 3
GINSBURG, J., dissenting
the copyright owner’s exclusive right under §106(3) to
control the distribution of a particular copy is exhausted,
and from that point forward, the copy can be resold or
otherwise redistributed without the copyright owner’s
authorization.
Section 602(a)(1) (2006 ed., Supp. V)1—last, but most
critical, of the three copyright provisions bearing on this
case—is an importation ban. It reads:
“Importation into the United States, without the
authority of the owner of copyright under this title, of
copies or phonorecords of a work that have been
acquired outside the United States is an infringe-
ment of the exclusive right to distribute copies or
phonorecords under section 106, actionable under sec
tion 501.”
In Quality King Distributors, Inc. v. L’anza Research
Int’l, Inc., 523 U.S. 135, 143–154 (1998), the Court held
that a copyright owner’s right to control importation under
§602(a)(1) is a component of the distribution right set forth
in §106(3) and is therefore subject to §109(a)’s codification
of the first sale doctrine. Quality King thus held that
the importation of copies made in the United States but
sold abroad did not rank as copyright infringement
under §602(a)(1). Id., at 143–154. See also id., at 154
(GINSBURG, J., concurring) (Quality King “involve[d] a
‘round trip’ journey, travel of the copies in question from
the United States to places abroad, then back again”).2
——————
1 In 2008, Congress renumbered what was previously §602(a) as
§602(a)(1). See Prioritizing Resources and Organization for Intellectual
Property Act of 2008 (PROIPA), §105(b)(2), 122 Stat. 4259. Like the
Court, I refer to the provision by its current numbering.
2 Although JUSTICE KAGAN’s concurrence suggests that Quality King
erred in “holding that §109(a) limits §602(a)(1),” ante, at 2, that recent,
unanimous holding must be taken as a given. See John R. Sand &
Gravel Co. v. United States, 552 U.S. 130, 139 (2008) (“[S]tare decisis
in respect to statutory interpretation has ‘special force,’ for ‘Congress
4 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
Important to the Court’s holding, the copies at issue in
Quality King had been “ ‘lawfully made under [Title
17]’ ”—a prerequisite for application of §109(a). Id., at 143,
n. 9 (quoting §109(a)). Section 602(a)(1), the Court noted,
would apply to “copies that were ‘lawfully made’ not under
the United States Copyright Act, but instead, under the
law of some other country.” Id., at 147. Drawing on an
example discussed during a 1964 public meeting on pro
posed revisions to the U. S. copyright laws,3 the Court
stated:
“If the author of [a] work gave the exclusive United
States distribution rights—enforceable under the
Act—to the publisher of the United States edition and
the exclusive British distribution rights to the pub
lisher of the British edition, . . . presumably only those
[copies] made by the publisher of the United States
edition would be ‘lawfully made under this title’
within the meaning of §109(a). The first sale doctrine
would not provide the publisher of the British edition
who decided to sell in the American market with a de
fense to an action under §602(a) (or, for that matter,
——————
remains free to alter what we have done.’ ” (quoting Patterson v.
McLean Credit Union, 491 U.S. 164, 172–173 (1989))). The Court’s
objective in this case should be to avoid unduly “constrict[ing] the scope
of §602(a)(1)’s ban on unauthorized importation,” ante, at 1 (opinion of
KAGAN, J.), while at the same time remaining faithful to Quality King’s
holding and to the text and history of other Copyright Act provisions.
This aim is not difficult to achieve. See Parts II–V, infra. JUSTICE
KAGAN and I appear to agree to this extent: Congress meant the ban on
unauthorized importation to have real force. See ante, at 3 (acknowl
edging that “Wiley may have a point about what §602(a)(1) was de
signed to do”).
3 See Quality King Distributors, Inc. v. L’anza Research Int’l, Inc., 523
U.S. 135, 148, n. 20 (1998) (quoting Copyright Law Revision Part 4:
Further Discussions and Comments on Preliminary Draft for Revised
U. S. Copyright Law, 88th Cong., 2d Sess., 119 (H. R. Judiciary Comm.
Print 1964) (hereinafter Copyright Law Revision Part 4) (statement of
Harriet Pilpel)).
Cite as: 568 U. S. ____ (2013) 5
GINSBURG, J., dissenting
to an action under §106(3), if there was a distribution
of the copies).” Id., at 148.
As the District Court and the Court of Appeals concluded,
see 654 F.3d 210, 221–222 (CA2 2011); App. to Pet. for
Cert. 70a–73a, application of the Quality King analysis to
the facts of this case would preclude any invocation of
§109(a). Petitioner Supap Kirtsaeng imported and then
sold at a profit over 600 copies of copyrighted textbooks
printed outside the United States by the Asian subsidiary
of respondent John Wiley & Sons, Inc. (Wiley). App. 29–
34. See also ante, at 3–5 (opinion of the Court). In the
words the Court used in Quality King, these copies “were
‘lawfully made’ not under the United States Copyright
Act, but instead, under the law of some other country.”
523 U.S., at 147. Section 109(a) therefore does not ap-
ply, and Kirtsaeng’s unauthorized importation constitutes
copyright infringement under §602(a)(1).
The Court does not deny that under the language I have
quoted from Quality King, Wiley would prevail. Ante, at
27. Nevertheless, the Court dismisses this language, to
which all Members of the Quality King Court subscribed,
as ill-considered dictum. Ante, at 27–28. I agree that the
discussion was dictum in the sense that it was not essen
tial to the Court’s judgment. See Quality King, 523 U.S.,
at 154 (GINSBURG, J., concurring) (“[W]e do not today
resolve cases in which the allegedly infringing imports
were manufactured abroad.”). But I disagree with the
Court’s conclusion that this dictum was ill considered.
Instead, for the reasons explained below, I would hold,
consistently with Quality King’s dictum, that §602(a)(1)
authorizes a copyright owner to bar the importation of a
copy manufactured abroad for sale abroad.
II
The text of the Copyright Act demonstrates that Con
gress intended to provide copyright owners with a potent
6 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
remedy against the importation of foreign-made copies of
their copyrighted works. As the Court recognizes, ante, at
3, this case turns on the meaning of the phrase “lawfully
made under this title” in §109(a). In my view, that phrase
is most sensibly read as referring to instances in which a
copy’s creation is governed by, and conducted in compli
ance with, Title 17 of the U. S. Code. This reading is
consistent with the Court’s interpretation of similar lan
guage in other statutes. See Florida Dept. of Revenue v.
Piccadilly Cafeterias, Inc., 554 U.S. 33, 52–53 (2008)
(“under” in 11 U.S. C. §1146(a), a Bankruptcy Code provi
sion exempting certain asset transfers from stamp taxes,
means “pursuant to”); Ardestani v. INS, 502 U.S. 129, 135
(1991) (the phrase “under section 554” in the Equal Access
to Justice Act means “subject to” or “governed by” 5
U.S. C. §554 (internal quotation marks omitted)). It also
accords with dictionary definitions of the word “under.”
See, e.g., American Heritage Dictionary 1887 (5th ed.
2011) (“under” means, among other things, “[s]ubject to
the authority, rule, or control of ”).
Section 109(a), properly read, affords Kirtsaeng no
defense against Wiley’s claim of copyright infringement.
The Copyright Act, it has been observed time and again,
does not apply extraterritorially. See United Dictionary
Co. v. G. & C. Merriam Co., 208 U.S. 260, 264 (1908)
(copyright statute requiring that U. S. copyright notices be
placed in all copies of a work did not apply to copies pub
lished abroad because U. S. copyright laws have no “force”
beyond the United States’ borders); 4 M. Nimmer & D.
Nimmer, Copyright §17.02, p. 17–18 (2012) (hereinafter
Nimmer) (“[C]opyright laws do not have any extraterrito
rial operation.”); 4 W. Patry, Copyright §13:22, p. 13–66
(2012) (hereinafter Patry) (“Copyright laws are rigor-
ously territorial.”). The printing of Wiley’s foreign
manufactured textbooks therefore was not governed by
Title 17. The textbooks thus were not “lawfully made
Cite as: 568 U. S. ____ (2013) 7
GINSBURG, J., dissenting
under [Title 17],” the crucial precondition for application
of §109(a). And if §109(a) does not apply, there is no dis
pute that Kirtsaeng’s conduct constituted copyright in
fringement under §602(a)(1).
The Court’s point of departure is similar to mine. Ac
cording to the Court, the phrase “ ‘lawfully made under
this title’ means made ‘in accordance with’ or ‘in compli
ance with’ the Copyright Act.” Ante, at 8. But the Court
overlooks that, according to the very dictionaries it cites,
ante, at 9, the word “under” commonly signals a relation
ship of subjection, where one thing is governed or regu-
lated by another. See Black’s Law Dictionary 1525 (6th ed.
1990) (“under” “frequently” means “inferior” or “subordi
nate” (internal quotation marks omitted)); 18 Oxford
English Dictionary 950 (2d ed. 1989) (“under” means,
among other things, “[i]n accordance with (some regulative
power or principle)” (emphasis added)). See also Webster’s
Third New International Dictionary 2487 (1961) (“under”
means, among other things, “in . . . a condition of sub-
jection, regulation, or subordination” and “suffering re
striction, restraint, or control by”). Only by disregarding
this established meaning of “under” can the Court arrive
at the conclusion that Wiley’s foreign-manufactured text
books were “lawfully made under” U. S. copyright law,
even though that law did not govern their creation. It is
anomalous, however, to speak of particular conduct as
“lawful” under an inapplicable law. For example, one
might say that driving on the right side of the road in
England is “lawful” under U. S. law, but that would be so
only because U. S. law has nothing to say about the sub
ject. The governing law is English law, and English law
demands that driving be done on the left side of the road.4
——————
4 The Court asserts that my position gives the word “lawfully” in
§109(a) “little, if any, linguistic work to do.” Ante, at 9. That is not so.
My reading gives meaning to each word in the phrase “lawfully made
8 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
The logical implication of the Court’s definition of the
word “under” is that any copy manufactured abroad—even
a piratical one made without the copyright owner’s author
ization and in violation of the law of the country where it
was created—would fall within the scope of §109(a). Any
such copy would have been made “in accordance with” or
“in compliance with” the U. S. Copyright Act, in the sense
that manufacturing the copy did not violate the Act (be
cause the Act does not apply extraterritorially).
The Court rightly refuses to accept such an absurd
conclusion. Instead, it interprets §109(a) as applying only
to copies whose making actually complied with Title 17, or
would have complied with Title 17 had Title 17 been ap
plicable (i.e., had the copies been made in the United
States). See ante, at 8 (“§109(a)’s ‘first sale’ doctrine would
apply to copyrighted works as long as their manufacture
met the requirements of American copyright law.”). Con
gress, however, used express language when it called for
such a counterfactual inquiry in 17 U.S. C. §§602(a)(2)
and (b). See §602(a)(2) (“Importation into the United
States or exportation from the United States, without the
authority of the owner of copyright under this title, of
copies or phonorecords, the making of which either consti
tuted an infringement of copyright, or which would have
constituted an infringement of copyright if this title had
been applicable, is an infringement of the exclusive right
to distribute copies or phonorecords under section 106.”
(emphasis added)); §602(b) (“In a case where the making
——————
under this title.” The word “made” signifies that the conduct at issue is
the creation or manufacture of a copy. See Webster’s Third New
International Dictionary 1356 (1961) (defining “made” as “artificially
produced by a manufacturing process”). The word “lawfully” indicates
that for §109(a) to apply, the copy’s creation must have complied with
some body of law. Finally, the prepositional phrase “under this title”
clarifies what that body of law is—namely, the copyright prescriptions
contained in Title 17 of the U. S. Code.
Cite as: 568 U. S. ____ (2013) 9
GINSBURG, J., dissenting
of the copies or phonorecords would have constituted an
infringement of copyright if this title had been applicable,
their importation is prohibited.” (emphasis added)). Had
Congress intended courts to engage in a similarly hypo
thetical inquiry under §109(a), Congress would pre
sumably have included similar language in that section.
See Russello v. United States, 464 U.S. 16, 23 (1983)
(“ ‘[W]here Congress includes particular language in one
section of a statute but omits it in another section of the
same Act, it is generally presumed that Congress acts
intentionally and purposely in the disparate inclusion
or exclusion.’ ” (quoting United States v. Wong Kim Bo,
472 F.2d 720, 722 (CA5 1972) (per curiam); brackets in
original)).5
——————
5 Attempting to show that my reading of §109(a) is susceptible to the
same criticism, the Court points to the now-repealed “manufacturing
clause,” which required “copies of a work consisting preponderantly of
nondramatic literary material . . . in the English language” to be
“manufactured in the United States or Canada.” Copyright Act of 1976,
§601(a), 90 Stat. 2588. Because Congress expressly referred to manu
facturing in this provision, the Court contends, the phrase “lawfully
made under this title” in §109(a) cannot mean “manufactured in the
United States.” Ante, at 19. This argument is a non sequitur. I do not
contend that the phrases “lawfully made under this title” and “manu
factured in the United States” are interchangeable. To repeat, I read
the phrase “lawfully made under this title” as referring to instances in
which a copy’s creation is governed by, and conducted in compliance
with, Title 17 of the U. S. Code. See supra, at 6. Not all copies “manu
factured in the United States” will satisfy this standard. For example,
piratical copies manufactured in the United States without the copy
right owner’s authorization are not “lawfully made under [Title 17].”
Nor would the phrase “lawfully manufactured in the United States” be
an exact substitute for “lawfully made under this title.” The making of
a copy may be lawful under Title 17 yet still violate some other provi
sion of law. Consider, for example, a copy made with the copyright
owner’s authorization by workers who are paid less than minimum
wage. The copy would be “lawfully made under [Title 17]” in the sense
that its creation would not violate any provision of that title, but the
copy’s manufacturing would nonetheless be unlawful due to the viola
10 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
Not only does the Court adopt an unnatural construc
tion of the §109(a) phrase “lawfully made under this title.”
Concomitantly, the Court reduces §602(a)(1) to insignifi
cance. As the Court appears to acknowledge, see ante, at
26, the only independent effect §602(a)(1) has under to
day’s decision is to prohibit unauthorized importations
carried out by persons who merely have possession of, but
do not own, the imported copies. See 17 U.S. C. §109(a)
(§109(a) applies to any “owner of a particular copy or
phonorecord lawfully made under this title” (emphasis
added)).6 If this is enough to avoid rendering §602(a)(1)
entirely “superfluous,” ante, at 26, it hardly suffices to give
the owner’s importation right the scope Congress intended
it to have. Congress used broad language in §602(a)(1); it
did so to achieve a broad objective. Had Congress intended
simply to provide a copyright remedy against larcenous
lessees, licensees, consignees, and bailees of films and
other copyright-protected goods, see ante, at 13–14, 26, it
likely would have used language tailored to that narrow
purpose. See 2 Nimmer §8.12[B][6][c], at 8–184.31, n. 432
(“It may be wondered whether . . . potential causes of
action [against licensees and the like] are more than theo
retical.”). See also ante, at 2 (KAGAN, J., concurring) (the
Court’s decision limits §602(a)(1) “to a fairly esoteric set of
——————
tion of the minimum-wage laws.
6 When §602(a)(1) was originally enacted in 1976, it played an addi
tional role—providing a private cause of action against importers of
piratical goods. See Quality King, 523 U.S., at 146. In 2008, however,
Congress amended §602 to provide for such a cause of action in
§602(a)(2), which prohibits the unauthorized “[i]mportation into the
United States . . . of copies or phonorecords, the making of which either
constituted an infringement of copyright, or which would have consti
tuted an infringement of copyright if [Title 17] had been applicable.”
See PROIPA, §105(b)(3), 122 Stat. 4259–4260. Thus, under the Court’s
interpretation, the only conduct reached by §602(a)(1) but not
§602(a)(2) is a nonowner’s unauthorized importation of a nonpiratical
copy.
Cite as: 568 U. S. ____ (2013) 11
GINSBURG, J., dissenting
applications”).7
The Court’s decision also overwhelms 17 U.S. C.
§602(a)(3)’s exceptions to §602(a)(1)’s importation prohibi
tion. 2 P. Goldstein, Copyright §7.6.1.2(a), p. 7:141 (3d ed.
2012) (hereinafter Goldstein).8 Those exceptions permit
the importation of copies without the copyright owner’s
authorization for certain governmental, personal, schol-
arly, educational, and religious purposes. 17 U.S. C.
§602(a)(3). Copies imported under these exceptions “will
often be lawfully made gray market goods purchased
through normal market channels abroad.” 2 Goldstein
——————
7 Notably, the Court ignores the history of §602(a)(1), which reveals
that the primary purpose of the prescription was not to provide a
remedy against rogue licensees, consignees, and bailees, against whom
copyright owners could frequently assert breach-of-contract claims even
in the absence of §602(a)(1). Instead, the primary purpose of §602(a)(1)
was to reach third-party importers, enterprising actors like Kirtsaeng,
against whom copyright owners could not assert contract claims due to
lack of privity. See Part III, infra.
8 Section 602(a)(3) provides:
“This subsection [i.e., §602(a)] does not apply to—
“(A) importation or exportation of copies or phonorecords under the
authority or for the use of the Government of the United States or of
any State or political subdivision of a State, but not including copies or
phonorecords for use in schools, or copies of any audiovisual work
imported for purposes other than archival use;
“(B) importation or exportation, for the private use of the importer or
exporter and not for distribution, by any person with respect to no more
than one copy or phonorecord of any one work at any one time, or by
any person arriving from outside the United States or departing from
the United States with respect to copies or phonorecords forming part
of such person’s personal baggage; or
“(C) importation by or for an organization operated for scholarly,
educational, or religious purposes and not for private gain, with respect
to no more than one copy of an audiovisual work solely for its archival
purposes, and no more than five copies or phonorecords of any other
work for its library lending or archival purposes, unless the importation
of such copies or phonorecords is part of an activity consisting of sys
tematic reproduction or distribution, engaged in by such organization
in violation of the provisions of section 108(g)(2).”
12 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
§7.6.1.2(a), at 7:141.9 But if, as the Court holds, such
copies can in any event be imported by virtue of §109(a),
§602(a)(3)’s work has already been done. For example,
had Congress conceived of §109(a)’s sweep as the Court
does, what earthly reason would there be to provide, as
Congress did in §602(a)(3)(C), that a library may import
“no more than five copies” of a non-audiovisual work for its
“lending or archival purposes”?
The far more plausible reading of §§109(a) and 602(a),
then, is that Congress intended §109(a) to apply to copies
made in the United States, not to copies manufactured
and sold abroad. That reading of the first sale and impor
tation provisions leaves §602(a)(3)’s exceptions with real,
meaningful work to do. See TRW Inc. v. Andrews, 534
U.S. 19, 31 (2001) (“It is a cardinal principle of statutory
construction that a statute ought, upon the whole, to be so
construed that, if it can be prevented, no clause, sen
tence, or word shall be superfluous, void, or insignificant.”
(internal quotation marks omitted)). In the range of circum
stances covered by the exceptions, §602(a)(3) frees indi
viduals and entities who purchase foreign-made copies
abroad from the requirement they would otherwise face
under §602(a)(1) of obtaining the copyright owner’s per
mission to import the copies into the United States.10
——————
9 The term “gray market good” refers to a good that is “imported out
side the distribution channels that have been contractually negotiated
by the intellectual property owner.” Forsyth & Rothnie, Parallel
Imports, in The Interface Between Intellectual Property Rights and
Competition Policy 429 (S. Anderman ed. 2007). Such goods are also
commonly called “parallel imports.” Ibid.
10 The Court asserts that its reading of §109(a) is bolstered by §104,
which extends the copyright “protection[s]” of Title 17 to a wide variety
of foreign works. See ante, at 10–11. The “protection under this title”
afforded by §104, however, is merely protection against infringing
conduct within the United States, the only place where Title 17 applies.
See 4 W. Patry, Copyright §13:44.10, pp. 13–128 to 13–129 (2012)
(hereinafter Patry). Thus, my reading of the phrase “under this title” in
Cite as: 568 U. S. ____ (2013) 13
GINSBURG, J., dissenting
III
The history of §602(a)(1) reinforces the conclusion I
draw from the text of the relevant provisions: §109(a)
does not apply to copies manufactured abroad. Section
602(a)(1) was enacted as part of the Copyright Act of 1976,
90 Stat. 2589–2590. That Act was the product of a lengthy
revision effort overseen by the U. S. Copyright Office. See
Mills Music, Inc. v. Snyder, 469 U.S. 153, 159–160 (1985).
In its initial 1961 report on recommended revisions, the
Copyright Office noted that publishers had “suggested
that the [then-existing] import ban on piratical copies
should be extended to bar the importation of . . . foreign
edition[s]” in violation of “agreements to divide interna
tional markets for copyrighted works.” Copyright Law
Revision: Report of the Register of Copyrights on the
General Revision of the U. S. Copyright Law, 87th Cong.,
1st Sess., 126 (H. R. Judiciary Comm. Print 1961) (herein
after Copyright Law Revision). See Copyright Act of 1947,
§106, 61 Stat. 663 (“The importation into the United
States . . . of any piratical copies of any work copyrighted
——————
§109(a) is consistent with Congress’ use of that phrase in §104. Fur
thermore, §104 describes which works are entitled to copyright protec
tion under U. S. law. But no one disputes that Wiley’s copyrights in the
works at issue in this case are valid. The only question is whether
Kirtsaeng’s importation of copies of those works infringed Wiley’s
copyrights. It is basic to copyright law that “[o]wnership of a copyright
. . . is distinct from ownership of any material object in which the work
is embodied.” 17 U.S. C. §202. See also §101 (“ ‘Copies’ are material
objects, other than phonorecords, in which a work is fixed by any
method now known or later developed, and from which the work can be
perceived, reproduced, or otherwise communicated, either directly or
with the aid of a machine or device.”). Given the distinction copyright
law draws between works and copies, §104 is inapposite to the question
here presented. 4 Patry §13:44.10, at 13–129 (“There is no connection,
linguistically or substantively, between Section[s] 104 and 109: Section
104 deals with national eligibility for the intangible work of authorship;
Section 109(a) deals with the tangible, physical embodiment of the
work, the ‘copy.’ ”).
14 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
in the United States . . . is prohibited.”). The Copyright
Office originally recommended against such an extension
of the importation ban, reasoning that enforcement of
territorial restrictions was best left to contract law. Copy
right Law Revision 126.
Publishing-industry representatives argued strenuously
against the position initially taken by the Copyright Of
fice. At a 1962 panel discussion on the Copyright Office’s
report, for example, Horace Manges of the American Book
Publishers Council stated:
“When a U. S. book publisher enters into a contract
with a British publisher to acquire exclusive U. S.
rights for a particular book, he often finds that the
English edition . . . of that particular book finds its
way into this country. Now it’s all right to say, ‘Com
mence a lawsuit for breach of contract.’ But this is
expensive, burdensome, and, for the most part, inef
fective.” Copyright Law Revision Part 2: Discussion
and Comments on Report of the Register of Copy
rights on the General Revision of the U. S. Copyright
Law, 88th Cong., 1st Sess., 212 (H. R. Judiciary
Comm. Print 1963).
Sidney Diamond, representing London Records, elabo
rated on Manges’ statement. “There are many situations,”
he explained, “in which it is not necessarily a question of
the inadequacy of a contract remedy—in the sense that it
may be difficult or not quick enough to solve the particular
problem.” Id., at 213. “Very frequently,” Diamond stated,
publishers “run into a situation where . . . copies of [a]
work . . . produced in a foreign country . . . may be shipped
[to the United States] without violating any contract of the
U. S. copyright proprietor.” Ibid. To illustrate, Diamond
noted, if a “British publisher [sells a copy] to an individual
who in turn ship[s] it over” to the United States, the indi
vidual’s conduct would not “violate [any] contract between
Cite as: 568 U. S. ____ (2013) 15
GINSBURG, J., dissenting
the British and the American publisher.” Ibid. In such a
case, “no possibility of any contract remedy” would exist.
Ibid. The facts of Kirtsaeng’s case fit Diamond’s example,
save that the copies at issue here were printed and ini-
tially sold in Asia rather than Great Britain.
After considering comments on its 1961 report, the
Copyright Office “prepared a preliminary draft of provi
sions for a new copyright statute.” Copyright Law Revi
sion Part 3: Preliminary Draft for Revised U. S. Copyright
Law and Discussions and Comments on the Draft, 88th
Cong., 2d Sess., V (H. R. Judiciary Comm. Print 1964).
Section 44 of the draft statute addressed the concerns
raised by publishing-industry representatives. In particu
lar, §44(a) provided:
“Importation into the United States of copies or rec
ords of a work for the purpose of distribution to the
public shall, if such articles are imported without the
authority of the owner of the exclusive right to dis
tribute copies or records under this title, constitute an
infringement of copyright actionable under section 35
[i.e., the section providing for a private cause of action
for copyright infringement].” Id., at 32–33.
In a 1964 panel discussion regarding the draft statute,
Abe Goldman, the Copyright Office’s General Counsel, left
no doubt about the meaning of §44(a). It represented, he
explained, a “shif[t]” from the Copyright Office’s 1961
report, which had recommended against using copyright
law to facilitate publishers’ efforts to segment interna
tional markets. Copyright Law Revision Part 4: Further
Discussions and Comments on Preliminary Draft for
Revised U. S. Copyright Law, 88th Cong., 2d Sess., 203
(H. R. Judiciary Comm. Print 1964). Section 44(a), Gold
man stated, would allow copyright owners to bring in
fringement actions against importers of “foreign copies
that were made under proper authority.” Ibid. See also
16 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
id., at 205–206 (Goldman agreed with a speaker’s com
ment that §44(a) “enlarge[d]” U. S. copyright law by ex
tending import prohibitions “to works legally produced in
Europe” and other foreign countries).11
The next step in the copyright revision process was the
introduction in Congress of a draft bill on July 20, 1964.
See Copyright Law Revision Part 5: 1964 Revision Bill
with Discussions and Comments, 89th Cong., 1st Sess., III
(H. R. Judiciary Comm. Print 1965). After another round
of public comments, a revised bill was introduced on Feb
ruary 4, 1965. See Copyright Law Revision Part 6: Sup
plementary Report of the Register of Copyrights on the
General Revision of the U. S. Copyright Law: 1965 Revi
sion Bill, 89th Cong., 1st Sess., V (H. R. Judiciary Comm.
Print 1965) (hereinafter Copyright Law Revision Part 6).
In language closely resembling the statutory text later
enacted by Congress, §602(a) of the 1965 bill provided:
“Importation into the United States, without the au
thority of the owner of copyright under this title, of
copies or phonorecords of a work for the purpose of
distribution to the public is an infringement of the ex
clusive right to distribute copies or phonorecords un
der section 106, actionable under section 501.” Id., at
292.12
——————
11 As the Court observes, ante, at 29, Irwin Karp of the Authors
League of America stated at the 1964 panel discussion that §44(a) ran
counter to “the very basic concept of copyright law that, once you’ve sold
a copy legally, you can’t restrict its resale.” Copyright Law Revision
Part 4, at 212. When asked if he was “presenting . . . an argument
against” §44(a), however, Karp responded that he was “neutral on th[e]
provision.” Id., at 211. There is thus little reason to believe that any
changes to the wording of §44(a) before its codification in §602(a) were
made in response to Karp’s discussion of “the problem of restricting
[the] transfer of . . . lawfully obtained [foreign] copies.” Ibid.
12 There is but one difference between this language from the 1965
bill and the corresponding language in the current version of §602(a)(1):
Cite as: 568 U. S. ____ (2013) 17
GINSBURG, J., dissenting
The Court implies that the 1965 bill’s “explici[t] re
fer[ence] to §106” showed a marked departure from §44(a)
of the Copyright Office’s prior draft. Ante, at 29. The
Copyright Office, however, did not see it that way. In its
summary of the 1965 bill’s provisions, the Copyright Office
observed that §602(a) of the 1965 bill, like §44(a) of the
Copyright Office’s prior draft, see supra, at 15–16, permit
ted copyright owners to bring infringement actions against
unauthorized importers in cases “where the copyright
owner had authorized the making of [the imported] copies
in a foreign country for distribution only in that country.”
Copyright Law Revision Part 6, at 149–150. See also id.,
at XXVI (Under §602(a) of the 1965 bill, “[a]n unauthorized
importer could be enjoined and sued for damages both
where the copies or phonorecords he was importing
were ‘piratical’ (that is, where their making would have
constituted an infringement if the U. S. copyright law
could have been applied), and where their making was
‘lawful.’ ”).
The current text of §602(a)(1) was finally enacted into
law in 1976. See Copyright Act of 1976, §602(a), 90 Stat.
2589–2590. The House and Senate Committee Reports on
the 1976 Act demonstrate that Congress understood, as
did the Copyright Office, just what that text meant. Both
Reports state:
“Section 602 [deals] with two separate situations: im
portation of ‘piratical’ articles (that is, copies or
phonorecords made without any authorization of the
——————
In the current version, the phrase “for the purpose of distribution to the
public” is omitted and the phrase “that have been acquired outside the
United States” appears in its stead. There are no material differences
between the quoted language from the 1965 bill and the corresponding
language contained in the 1964 bill. See Copyright Law Revision Part
6: Supplementary Report of the Register of Copyrights on the General
Revision of the U. S. Copyright Law: 1965 Revision Bill, 89th Cong., 1st
Sess., 292–293 (H. R. Judiciary Comm. Print 1965).
18 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
copyright owner), and unauthorized importation of
copies or phonorecords that were lawfully made. The
general approach of section 602 is to make unauthor-
ized importation an act of infringement in both cases,
but to permit the Bureau of Customs to prohibit im
portation only of ‘piratical’ articles.” S. Rep. No. 94–
473, p. 151 (1975) (emphasis added). See also H. R.
Rep. No. 94–1476, p. 169 (1976) (same).
In sum, the legislative history of the Copyright Act of
1976 is hardly “inconclusive.” Ante, at 28. To the con
trary, it confirms what the plain text of the Act conveys:
Congress intended §602(a)(1) to provide copyright owners
with a remedy against the unauthorized importation of
foreign-made copies of their works, even if those copies
were made and sold abroad with the copyright owner’s
authorization.13
IV
Unlike the Court’s holding, my position is consistent with
the stance the United States has taken in international
trade negotiations. This case bears on the highly con
tentious trade issue of interterritorial exhaustion. The
issue arises because intellectual property law is territorial
in nature, see supra, at 6, which means that creators of
intellectual property “may hold a set of parallel” intellec
tual property rights under the laws of different nations.
Chiappetta, The Desirability of Agreeing to Disagree: The
WTO, TRIPS, International IPR Exhaustion and a Few
Other Things, 21 Mich. J. Int’l L. 333, 340–341 (2000)
(hereinafter Chiappetta). There is no international con
——————
13 The Court purports to find support for its position in the House and
Senate Committee Reports on the 1976 Copyright Act. Ante, at 30–31.
It fails to come up with anything in the Act’s legislative history, how
ever, showing that Congress understood the words “lawfully made under
this title” in §109(a) to encompass foreign-made copies.
Cite as: 568 U. S. ____ (2013) 19
GINSBURG, J., dissenting
sensus on whether the sale in one country of a good in-
corporating protected intellectual property exhausts the
intellectual property owner’s right to control the distribu
tion of that good elsewhere. Indeed, the members of the
World Trade Organization, “agreeing to disagree,”14 pro
vided in Article 6 of the Agreement on Trade-Related
Aspects of Intellectual Property Rights (TRIPS), Apr. 15,
1994, 33 I. L. M. 1197, 1200, that “nothing in this Agree
ment shall be used to address the issue of . . . exhaustion.”
See Chiappetta 346 (observing that exhaustion of intellec
tual property rights was “hotly debated” during the TRIPS
negotiations and that Article 6 “reflects [the negotiators’]
ultimate inability to agree” on a single international
standard). Similar language appears in other treaties to
which the United States is a party. See World Intellectual
Property Organization (WIPO) Copyright Treaty, Art. 6(2),
Dec. 20, 1996, S. Treaty Doc. No. 105–17, p. 7 (“Nothing in
this Treaty shall affect the freedom of Contracting Parties
to determine the conditions, if any, under which the ex
haustion of the right [to control distribution of copies of a
copyrighted work] applies after the first sale or other
transfer of ownership of the original or a copy of the work
with the authorization of the author.”); WIPO Perfor
mances and Phonograms Treaty, Art. 8(2), Dec. 20, 1996,
S. Treaty Doc. No. 105–17, p. 28 (containing language
nearly identical to Article 6(2) of the WIPO Copyright
Treaty).
In the absence of agreement at the international level,
each country has been left to choose for itself the exhaus
tion framework it will follow. One option is a national
exhaustion regime, under which a copyright owner’s right
——————
14 Chiappetta,The Desirability of Agreeing to Disagree: The WTO,
TRIPS, International IPR Exhaustion and a Few Other Things, 21
Mich. J. Int’l L. 333, 340 (2000) (hereinafter Chiappetta) (internal
quotation marks omitted).
20 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
to control distribution of a particular copy is exhausted
only within the country in which the copy is sold. See
Forsyth & Rothnie, Parallel Imports, in The Interface
Between Intellectual Property Rights and Competition
Policy 429, 430 (S. Anderman ed. 2007) (hereinafter
Forsyth & Rothnie). Another option is a rule of international
exhaustion, under which the authorized distribution of a
particular copy anywhere in the world exhausts the copy
right owner’s distribution right everywhere with respect
to that copy. See ibid. The European Union has adopted
the intermediate approach of regional exhaustion, under
which the sale of a copy anywhere within the European
Economic Area exhausts the copyright owner’s distribu
tion right throughout that region. See id., at 430, 445.
Section 602(a)(1), in my view, ties the United States to a
national-exhaustion framework. The Court’s decision, in con-
trast, places the United States solidly in the international
exhaustion camp.
Strong arguments have been made both in favor of, and
in opposition to, international exhaustion. See Chiappetta
360 (“[r]easonable people making valid points can, and
do, reach conflicting conclusions” regarding the desirability
of international exhaustion). International exhaustion
subjects copyright-protected goods to competition from
lower priced imports and, to that extent, benefits con-
sumers. Correspondingly, copyright owners profit from a
national-exhaustion regime, which also enlarges the mon
etary incentive to create new copyrightable works. See
Forsyth & Rothnie 432–437 (surveying arguments for and
against international exhaustion).
Weighing the competing policy concerns, our Govern
ment reached the conclusion that widespread adoption of
the international-exhaustion framework would be incon
sistent with the long-term economic interests of the United
States. See Brief for United States as Amicus Curiae in
Quality King, O. T. 1997, No. 96–1470, pp. 22–26 (herein
Cite as: 568 U. S. ____ (2013) 21
GINSBURG, J., dissenting
after Quality King Brief).15 Accordingly, the United States
has steadfastly “taken the position in international trade
negotiations that domestic copyright owners should . . .
have the right to prevent the unauthorized importation of
copies of their work sold abroad.” Id., at 22. The United
States has “advanced this position in multilateral trade
negotiations,” including the negotiations on the TRIPS
Agreement. Id., at 24. See also D. Gervais, The TRIPS
Agreement: Drafting History and Analysis §2.63, p. 199
(3d ed. 2008). It has also taken a dim view of our trading
partners’ adoption of legislation incorporating elements
of international exhaustion. See Clapperton & Corones,
Locking in Customers, Locking Out Competitors: Anti-
Circumvention Laws in Australia and Their Potential
Effect on Competition in High Technology Markets, 30
Melbourne U. L. Rev. 657, 664 (2006) (United States
expressed concern regarding international-exhaustion leg-
islation in Australia); Montén, Comment, The Inconsistency
Between Section 301 and TRIPS: Counterproductive
With Respect to the Future of International Protection
of Intellectual Property Rights? 9 Marq. Intellectual
——————
15 The Court states that my “reliance on the Solicitor General’s posi
tion in Quality King is undermined by his agreement in that case with
[the] reading of §109(a)” that the Court today adopts. Ante, at 33. The
United States’ principal concern in both Quality King and this case,
however, has been to protect copyright owners’ “right to prevent paral
lel imports.” Brief for United States as Amicus Curiae in Quality King,
O. T. 1997, No. 96–1470, p. 6 (hereinafter Quality King Brief). See also
Brief for United States as Amicus Curiae 14 (arguing that Kirtsaeng’s
interpretation of §109(a), which the Court adopts, would “subver[t]
Section 602(a)(1)’s ban on unauthorized importation”). In Quality King,
the Solicitor General urged this Court to hold that §109(a)’s codification
of the first sale doctrine does not limit the right to control importation
set forth in §602(a). Quality King Brief 7–30. After Quality King
rejected that contention, the United States reconsidered its position,
and it now endorses the interpretation of the §109(a) phrase “lawfully
made under this title” I would adopt. Brief for United States as Amicus
Curiae 6–7, 13–14.
22 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
Property L. Rev. 387, 417–418 (2005) (same with respect
to New Zealand and Taiwan).
Even if the text and history of the Copyright Act were am-
biguous on the answer to the question this case presents—
which they are not, see Parts II–III, supra16—I
would resist a holding out of accord with the firm position
the United States has taken on exhaustion in internation
al negotiations. Quality King, I acknowledge, discounted
the Government’s concerns about potential inconsistency
with United States obligations under certain bilateral
trade agreements. See 523 U.S., at 153–154. See also
Quality King Brief 22–24 (listing the agreements). That
decision, however, dealt only with copyright-protected
products made in the United States. See 523 U.S., at 154
(GINSBURG, J., concurring). Quality King left open the
question whether owners of U. S. copyrights could retain
control over the importation of copies manufactured and
sold abroad—a point the Court obscures, see ante, at 33
(arguing that Quality King “significantly eroded” the
national-exhaustion principle that, in my view, §602(a)(1)
embraces). The Court today answers that question with a
resounding “no,” and in doing so, it risks undermining the
United States’ credibility on the world stage. While the
Government has urged our trading partners to refrain
from adopting international-exhaustion regimes that could
benefit consumers within their borders but would impact
adversely on intellectual-property producers in the United
States, the Court embraces an international-exhaustion
rule that could benefit U. S. consumers but would likely
——————
16 Congress hardly lacks capacity to provide for international exhaus
tion when that is its intent. Indeed, Congress has expressly provided
for international exhaustion in the narrow context of semiconductor
chips embodying protected “mask works.” See 17 U.S. C. §§905(2),
906(b). See also 2 M. Nimmer & D. Nimmer, Copyright §8A.06[E],
p. 8A–37 (2012) (hereinafter Nimmer) (“[T]he first sale doctrine under
[§906(b)] expressly immunizes unauthorized importation.”).
Cite as: 568 U. S. ____ (2013) 23
GINSBURG, J., dissenting
disadvantage foreign holders of U. S. copyrights. This
dissonance scarcely enhances the United States’ “role as a
trusted partner in multilateral endeavors.” Vimar Seguros
y Reaseguros, S. A. v. M/V Sky Reefer, 515 U.S. 528,
539 (1995).
V
I turn now to the Court’s justifications for a decision
difficult to reconcile with the Copyright Act’s text and
history.
A
The Court asserts that its holding “is consistent with
antitrust laws that ordinarily forbid market divisions.”
Ante, at 32. See also ante, at 18 (again referring to anti
trust principles). Section 602(a)(1), however, read as I do
and as the Government does, simply facilitates copyright
owners’ efforts to impose “vertical restraints” on distribu
tors of copies of their works. See Forsyth & Rothnie 435
(“Parallel importation restrictions enable manufacturers
and distributors to erect ‘vertical restraints’ in the market
through exclusive distribution agreements.”). See gener-
ally Leegin Creative Leather Products, Inc. v. PSKS, Inc.,
551 U.S. 877 (2007) (discussing vertical restraints). We
have held that vertical restraints are not per se illegal
under §1 of the Sherman Act, 15 U.S. C. §1, because such
“restraints can have procompetitive effects.” 551 U.S., at
881–882.17
——————
17 Despite the Court’s suggestion to the contrary, this case in no
way implicates the per se antitrust prohibition against horizontal
“ ‘[a]greements between competitors to allocate territories to minimize
competition.’ ” Ante, at 32 (quoting Palmer v. BRG of Ga., Inc., 498
U.S. 46, 49 (1990) (per curiam)). Wiley is not requesting authority to
enter into collusive agreements with other textbook publishers that
would, for example, make Wiley the exclusive supplier of textbooks
on particular subjects within particular geographic regions. Instead,
Wiley asserts no more than the prerogative to impose vertical restraints
24 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
B
The Court sees many “horribles” following from a hold
ing that the §109(a) phrase “lawfully made under this
title” does not encompass foreign-made copies. Ante, at 22
(internal quotation marks omitted). If §109(a) excluded
foreign-made copies, the Court fears, then copyright own
ers could exercise perpetual control over the downstream
distribution or public display of such copies. A ruling in
Wiley’s favor, the Court asserts, would shutter libraries,
put used-book dealers out of business, cripple art muse
ums, and prevent the resale of a wide range of consumer
goods, from cars to calculators. Ante, at 19–22. See also
ante, at 2–3 (KAGAN, J., concurring) (expressing concern
about “imposing downstream liability on those who pur
chase and resell in the United States copies that happen
to have been manufactured abroad”). Copyright law and
precedent, however, erect barriers to the anticipated
horribles.18
1
Recognizing that foreign-made copies fall outside the
ambit of §109(a) would not mean they are forever free of
the first sale doctrine. As earlier observed, see supra, at 2,
the Court stated that doctrine initially in its 1908 Bobbs-
——————
on the distribution of its own textbooks. See Hovenkamp, Post-Sale
Restraints and Competitive Harm: The First Sale Doctrine in Perspec
tive, 66 N. Y. U. Ann. Survey Am. L. 487, 488 (2011) (“vertical re
straints” include “limits [on] the way a seller’s own product can be
distributed”).
18 As the Court observes, ante, at 32–33, the United States stated at
oral argument that the types of “horribles” predicted in the Court’s
opinion would, if they came to pass, be “worse than the frustration of
market segmentation” that will result from the Court’s interpretation
of §109(a). Tr. of Oral Arg. 51. The United States, however, recognized
that this purported dilemma is a false one. As the United States
explained, the Court’s horribles can be avoided while still giving mean
ingful effect to §602(a)(1)’s ban on unauthorized importation. Ibid.
Cite as: 568 U. S. ____ (2013) 25
GINSBURG, J., dissenting
Merrill decision. At that time, no statutory provision
expressly codified the first sale doctrine. Instead, copy
right law merely provided that copyright owners had “the
sole liberty of printing, reprinting, publishing, completing,
copying, executing, finishing, and vending” their works.
Copyright Act of 1891, §1, 26 Stat. 1107.
In Bobbs-Merrill, the Court addressed the scope of the
statutory right to “ven[d].” In granting that right, the
Court held, Congress did not intend to permit copyright
owners “to fasten . . . a restriction upon the subsequent
alienation of the subject-matter of copyright after the
owner had parted with the title to one who had acquired
full dominion over it and had given a satisfactory price for
it.” 210 U.S., at 349–350. “[O]ne who has sold a copy
righted article . . . without restriction,” the Court ex
plained, “has parted with all right to control the sale of it.”
Id., at 350. Thus, “[t]he purchaser of a book, once sold by
authority of the owner of the copyright, may sell it again,
although he could not publish a new edition of it.” Ibid.
Under the logic of Bobbs-Merrill, the sale of a foreign
manufactured copy in the United States carried out with
the copyright owner’s authorization would exhaust the
copyright owner’s right to “vend” that copy. The copy
could thenceforth be resold, lent out, or otherwise redis
tributed without further authorization from the copyright
owner. Although §106(3) uses the word “distribute” rather
than “vend,” there is no reason to think Congress intended
the word “distribute” to bear a meaning different from the
construction the Court gave to the word “vend” in Bobbs-
Merrill. See ibid. (emphasizing that the question before
the Court was “purely [one] of statutory construction”).19
——————
19 It appears that the Copyright Act of 1976 omitted the word “vend”
and introduced the word “distribute” to avoid the “redundan[cy]”
present in pre-1976 law. Copyright Law Revision: Report of the Regis
ter of Copyrights on the General Revision of the U. S. Copyright Law,
87th Cong., 1st Sess., 21 (H. R. Judiciary Comm. Print 1961) (noting
26 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
Thus, in accord with Bobbs-Merrill, the first authorized
distribution of a foreign-made copy in the United States
exhausts the copyright owner’s distribution right under
§106(3). After such an authorized distribution, a library
may lend, or a used-book dealer may resell, the foreign
made copy without seeking the copyright owner’s permis
sion. Cf. ante, at 19–21.
For example, if Wiley, rather than Kirtsaeng, had
imported into the United States and then sold the foreign
made textbooks at issue in this case, Wiley’s §106(3) dis
tribution right would have been exhausted under the
rationale of Bobbs-Merrill. Purchasers of the textbooks
would thus be free to dispose of the books as they wished
without first gaining a license from Wiley.
This line of reasoning, it must be acknowledged, signifi
cantly curtails the independent effect of §109(a). If, as I
maintain, the term “distribute” in §106(3) incorporates the
first sale doctrine by virtue of Bobbs-Merrill, then
§109(a)’s codification of that doctrine adds little to the
regulatory regime.20 Section 109(a), however, does serve
——————
that the exclusive rights to “publish” and “vend” works under the
Copyright Act of 1947, §1(a), 61 Stat. 652–653, were “redundant”).
20 My position that Bobbs-Merrill lives on as a limiting construction of
the §106(3) distribution right does not leave §109(a) with no work to do.
There can be little doubt that the books at issue in Bobbs-Merrill were
published and first sold in the United States. See Bobbs-Merrill Co. v.
Straus, 139 F. 155, 157 (CC SDNY 1905) (the publisher claiming copy-
right infringement in Bobbs-Merrill was incorporated and had its
principal office in Indiana). See also Copyright Act of 1891, §3, 26 Stat.
1107–1108 (generally prohibiting importation, even by the copyright
owner, of foreign-manufactured copies of copyrighted books); 4 Patry
§13:40, at 13–111 (under the Copyright Act of 1891, “copies of books by
both foreign and U. S. authors had to be printed in the United States”).
But cf. ante, at 18 (asserting, without acknowledging the 1891 Copy
right Act’s general prohibition against the importation of foreign-made
copies of copyrighted books, that the Court is unable to find any “geo
graphical distinctions . . . in Bobbs-Merrill ”). Thus, exhaustion occurs
under Bobbs-Merrill only when a copy is distributed within the United
Cite as: 568 U. S. ____ (2013) 27
GINSBURG, J., dissenting
as a statutory bulwark against courts deviating from
Bobbs-Merrill in a way that increases copyright owners’
control over downstream distribution, and legislative
history indicates that is precisely the role Congress in
tended §109(a) to play. Congress first codified the first
sale doctrine in §41 of the Copyright Act of 1909, 35 Stat.
1084.21 It did so, the House Committee Report on the
1909 Act explains, “in order to make . . . clear that [Con
gress had] no intention [of] enlarg[ing] in any way the
construction to be given to the word ‘vend.’ ” H. R. Rep.
No. 2222, 60th Cong., 2d Sess., 19 (1909). According to the
Committee Report, §41 was “not intended to change [exist
ing law] in any way.” Ibid. The position I have stated and
explained accords with this expression of congressional
intent. In enacting §41 and its successors, I would hold,
Congress did not “change . . . existing law,” ibid., by strip
ping the word “vend” (and thus its substitute “distribute”)
of the limiting construction imposed in Bobbs-Merrill.
In any event, the reading of the Copyright Act to which
I subscribe honors Congress’ aim in enacting §109(a)
while the Court’s reading of the Act severely diminishes
§602(a)(1)’s role. See supra, at 10–12. My position in no
way tugs against the principle underlying §109(a)—i.e.,
that certain conduct by the copyright owner exhausts the
——————
States with the copyright owner’s permission, not when it is distributed
abroad. But under §109(a), as interpreted in Quality King, any author
ized distribution of a U. S.-made copy, even a distribution occurring in
a foreign country, exhausts the copyright owner’s distribution right
under §106(3). See 523 U.S., at 145, n. 14. Section 109(a) therefore
provides for exhaustion in a circumstance not reached by Bobbs-Merrill.
21 Section 41 of the 1909 Act provided: “[N]othing in this Act shall be
deemed to forbid, prevent, or restrict the transfer of any copy of a
copyrighted work the possession of which has been lawfully obtained.”
35 Stat. 1084. This language was repeated without material change in
§27 of the Copyright Act of 1947, 61 Stat. 660. As noted above, see
supra, at 2, 17 U.S. C. §109(a) sets out the current codification of the
first sale doctrine.
28 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
owner’s §106(3) distribution right. The Court, in contrast,
fails to give meaningful effect to Congress’ manifest intent
in §602(a)(1) to grant copyright owners the right to control
the importation of foreign-made copies of their works.
2
Other statutory prescriptions provide further protection
against the absurd consequences imagined by the Court.
For example, §602(a)(3)(C) permits “an organization oper
ated for scholarly, educational, or religious purposes” to
import, without the copyright owner’s authorization, up to
five foreign-made copies of a non-audiovisual work—
notably, a book—for “library lending or archival purposes.”
But cf. ante, at 19–20 (suggesting that affirming the Se
cond Circuit’s decision might prevent libraries from lend
ing foreign-made books).22
The Court also notes that amici representing art muse
ums fear that a ruling in Wiley’s favor would prevent
museums from displaying works of art created abroad.
Ante, at 22 (citing Brief for Association of Art Museum
Directors et al.). These amici observe that a museum’s
right to display works of art often depends on 17 U.S. C.
§109(c). See Brief for Association of Art Museum Direc
tors et al. 11–13.23 That provision addresses exhaustion of
——————
22 A group of amici representing libraries expresses the concern
that lower courts might interpret §602(a)(3)(C) as authorizing only
the importing, but not the lending, of foreign-made copies of
non-audiovisual works. See Brief for American Library Association
et al. 20. The United States maintains, and I agree, however, that
§602(a)(3)(C) “is fairly (and best) read as implicitly authorizing lending,
in addition to importation, of all works other than audiovisual works.”
Brief for United States as Amicus Curiae 30, n. 6.
23 Title 17 U.S. C. §109(c) provides: “Notwithstanding the provisions
of section 106(5), the owner of a particular copy lawfully made under
this title, or any person authorized by such owner, is entitled, without
the authority of the copyright owner, to display that copy publicly,
either directly or by the projection of no more than one image at a time,
to viewers present at the place where the copy is located.”
Cite as: 568 U. S. ____ (2013) 29
GINSBURG, J., dissenting
a copyright owner’s exclusive right under §106(5) to
publicly display the owner’s work. Because §109(c), like
§109(a), applies only to copies “lawfully made under this
title,” amici contend that a ruling in Wiley’s favor would
prevent museums from invoking §109(c) with respect to
foreign-made works of art. Id., at 11–13.24
Limiting §109(c) to U. S.-made works, however, does not
bar art museums from lawfully displaying works made in
other countries. Museums can, of course, seek the copy
right owner’s permission to display a work. Furthermore,
the sale of a work of art to a U. S. museum may carry with
it an implied license to publicly display the work. See 2
Patry §5:131, at 5–280 (“[C]ourts have noted the potential
availability of an implied nonexclusive licens[e] when the
circumstances . . . demonstrate that the parties intended
that the work would be used for a specific purpose.”).
Displaying a work of art as part of a museum exhibition
might also qualify as a “fair use” under 17 U.S. C. §107.
Cf. Bouchat v. Baltimore Ravens Ltd. Partnership, 619
F.3d 301, 313–316 (CA4 2010) (display of copyrighted logo
in museum-like exhibition constituted “fair use”).
The Court worries about the resale of foreign-made
consumer goods “contain[ing] copyrightable software pro
grams or packaging.” Ante, at 21. For example, the Court
observes that a car might be programmed with diverse
forms of software, the copyrights to which might be
owned by individuals or entities other than the manu-
facturer of the car. Ibid. Must a car owner, the Court
asks, obtain permission from all of these various copyright
owners before reselling her car? Ibid. Although this
question strays far from the one presented in this case and
briefed by the parties, principles of fair use and implied
——————
24 The word “copy,” as it appears in §109(c), applies to the original of a
work of art because the Copyright Act defines the term “copies” to
“includ[e] the material object . . . in which the work is first fixed.” §101.
30 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
license (to the extent that express licenses do not exist)
would likely permit the car to be resold without the copy
right owners’ authorization.25
Most telling in this regard, no court, it appears, has
been called upon to answer any of the Court’s “horribles”
in an actual case. Three decades have passed since a
federal court first published an opinion reading §109(a) as
applicable exclusively to copies made in the United States.
See Columbia Broadcasting System, Inc. v. Scorpio Music
Distributors, Inc., 569 F. Supp. 47, 49 (ED Pa. 1983),
summarily aff ’d, 738 F.2d 424 (CA3 1984) (table). Yet
Kirtsaeng and his supporting amici cite not a single case
in which the owner of a consumer good authorized for sale
in the United States has been sued for copyright infringe
ment after reselling the item or giving it away as a gift or
to charity. The absence of such lawsuits is unsurprising.
Routinely suing one’s customers is hardly a best business
——————
25 Principlesof fair use and implied license may also allow a U. S.
tourist “who buys a copyrighted work of art, a poster, or . . . a bumper
sticker” abroad to publicly “display it in America without the copyright
owner’s further authorization.” Ante, at 15. (The tourist could lawfully
bring the work of art, poster, or bumper sticker into the United States
under 17 U.S. C. §602(a)(3)(B), which provides that §602(a)(1)’s impor
tation ban does not apply to “importation . . . by any person arriving
from outside the United States . . . with respect to copies . . . forming
part of such person’s personal baggage.”). Furthermore, an individual
clearly would not incur liability for infringement merely by displaying a
foreign-made poster or other artwork in her home. See §106(5) (grant
ing the owners of copyrights in “literary, musical, dramatic, and chore
ographic works, pantomimes, and pictorial, graphic, or sculptural
works” the exclusive right “to display the copyrighted work publicly”
(emphasis added)). See also §101 (a work is displayed “publicly” if it is
displayed “at a place open to the public or at any place where a sub
stantial number of persons outside of a normal circle of a family and its
social acquaintances is gathered” (emphasis added)). Cf. 2 Nimmer
§8.14[C][1], at 8–192.2(1) (“[A] performance limited to members of
the family and invited guests is not a public performance.” (footnote
omitted)).
Cite as: 568 U. S. ____ (2013) 31
GINSBURG, J., dissenting
practice.26 Manufacturers, moreover, may be hesitant to
do business with software programmers taken to suing
consumers. Manufacturers may also insist that soft
ware programmers agree to contract terms barring such
lawsuits.
The Court provides a different explanation for the
absence of the untoward consequences predicted in its
opinion—namely, that lower court decisions regarding the
scope of §109(a)’s first sale prescription have not been
uniform. Ante, at 23. Uncertainty generated by these
conflicting decisions, the Court notes, may have deterred
some copyright owners from pressing infringement claims.
Ante, at 23–24. But if, as the Court suggests, there are a
multitude of copyright owners champing at the bit to bring
lawsuits against libraries, art museums, and consumers in
an effort to exercise perpetual control over the down
stream distribution and public display of foreign-made
copies, might one not expect that at least a handful of such
lawsuits would have been filed over the past 30 years?
The absence of such suits indicates that the “practical
problems” hypothesized by the Court are greatly exagger
ated. Ante, at 24.27 They surely do not warrant disregard
——————
26 Exerting extensive control over secondary markets may not always
be in a manufacturer’s best interest. Carmakers, for example, often
trumpet the resale value of their vehicles. See, e.g., Nolan, UD grad
leads Cadillac marketing, Dayton Daily News, Apr. 2, 2009, p. A8
(“Cadillac plays up its warranty coverage and reliable resale value to
prospective customers.”). If the transaction costs of reselling vehicles
were to rise, consumers’ perception of a new car’s value, and thus the
price they are willing to pay for such a car, might fall—an outcome
hardly favorable to automobile manufacturers.
27 It should not be overlooked that the ability to prevent importation
of foreign-made copies encourages copyright owners such as Wiley to
offer copies of their works at reduced prices to consumers in less devel
oped countries who might otherwise be unable to afford them. The
Court’s holding, however, prevents copyright owners from barring the
importation of such low-priced copies into the United States, where
they will compete with the higher priced editions copyright owners
32 KIRTSAENG v. JOHN WILEY & SONS, INC.
GINSBURG, J., dissenting
ing Congress’ intent, expressed in §602(a)(1), to grant
copyright owners the authority to bar the importation of
foreign-made copies of their works. Cf. Hartford Under-
writers Ins. Co. v. Union Planters Bank, N. A., 530 U.S. 1,
6 (2000) (“[W]hen the statute’s language is plain, the sole
function of the courts—at least where the disposition
required by the text is not absurd—is to enforce it accord
ing to its terms.” (internal quotation marks omitted)).
VI
To recapitulate, the objective of statutory interpretation
is “to give effect to the intent of Congress.” American
Trucking Assns., 310 U.S., at 542. Here, two congres-
sional aims are evident. First, in enacting §602(a)(1), Con
gress intended to grant copyright owners permission to
segment international markets by barring the importation
of foreign-made copies into the United States. Second, as
codification of the first sale doctrine underscores, Congress
did not want the exclusive distribution right conferred in
§106(3) to be boundless. Instead of harmonizing these
objectives, the Court subordinates the first entirely to the
second. It is unsurprising that none of the three major
treatises on U. S. copyright law embrace the Court’s con
struction of §109(a). See 2 Nimmer §8.12[B][6][c], at
——————
make available for sale in this country. To protect their profit margins
in the U. S. market, copyright owners may raise prices in less devel
oped countries or may withdraw from such markets altogether. See
Brief for United States as Amicus Curiae 26; Brief for Text and Aca
demic Authors Association as Amicus Curiae 12; Brief for Association of
American Publishers as Amicus Curiae 37. See also Chiappetta 357–
358 (a rule of national exhaustion “encourages entry and participation
in developing markets at lower, locally more affordable prices by
eliminating them as risky sources of cheaper parallel imports back into
premium markets”). Such an outcome would disserve consumers—and
especially students—in developing nations and would hardly advance
the “American foreign policy goals” of supporting education and eco
nomic development in such countries. Quality King Brief 25–26.
Cite as: 568 U. S. ____ (2013) 33
GINSBURG, J., dissenting
8–184.34 to 8–184.35; 2 Goldstein §7.6.1.2(a), at 7:141; 4
Patry §§13:22, 13:44, 13:44.10.
Rather than adopting the very international-exhaustion
rule the United States has consistently resisted in
international-trade negotiations, I would adhere to the
national-exhaustion framework set by the Copyright
Act’s text and history. Under that regime, codified in
§602(a)(1), Kirtsaeng’s unauthorized importation of the
foreign-made textbooks involved in this case infringed
Wiley’s copyrights. I would therefore affirm the Second
Circuit’s judgment | “In the interpretation of statutes, the function of the courts is easily stated. It is to construe the language so as to give effect to the intent of Congress.” United States v. American Trucking Inc., Instead of adhering to the Legislature’s design, the Court today adopts an interpretation of the Copyright Act at odds with Congress’ aim to protect copyright owners against the unauthorized importation of low-priced, foreign made copies of their copyrighted works. The Court’s bold departure from Congress’ design is all the more stunning, for it places the United States at the vanguard of the movement for “international exhaustion” of copyrights—a movement the United States has steadfastly resisted on the world stage. To justify a holding that shrinks to insignificance copy right protection against the unauthorized importation of foreign-made copies, the Court identifies several “practical problems.” Ante, The Court’s parade of horribles, however, is largely imaginary. Congress’ objective in enacting 17 U.S. C. importation prohibition can be honored without generating the absurd conse quences hypothesized in the Court’s opinion. I dissent 2 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting from the Court’s embrace of “international exhaustion,” and would affirm the sound judgment of the Court of Appeals. I Because economic conditions and demand for particular goods vary across the globe, copyright owners have a financial incentive to charge different prices for copies of their works in different geographic regions. Their ability to engage in such price discrimination, however, is under mined if arbitrageurs are permitted to import copies from low-price regions and sell them in high-price regions. The question in this case is whether the unauthorized importation of foreign-made copies constitutes copyright infringement under U. S. law. To answer this question, one must examine three provi sions of Title 17 of the U. S. Code: 109(a), and 602(a)(1). Section 106 sets forth the “exclusive rights” of a copyright owner, including the right “to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending.” This distribution right is limited by which provides: “Notwithstanding the provisions of section 106(3), the owner of a particular copy or phono- record lawfully made under this title is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord.” Section 109(a) codifies the “first sale doc trine,” a doctrine articulated in Bobbs-Merrill Co. v. Straus, which held that a copyright owner could not control the price at which re tailers sold lawfully purchased copies of its work. The first sale doctrine recognizes that a copyright owner should not be permitted to exercise perpetual control over the distribution of copies of a copyrighted work. At some point—ordinarily the time of the first commercial sale— Cite as: 568 U. S. (2013) 3 GINSBURG, J., dissenting the copyright owner’s exclusive right under to control the distribution of a particular copy is exhausted, and from that point forward, the copy can be resold or otherwise redistributed without the copyright owner’s authorization. Section 602(a)(1) (2006 ed., Supp. V)1—last, but most critical, of the three copyright provisions bearing on this case—is an importation ban. It reads: “Importation into the United States, without the authority of the owner of copyright under this title, of copies or phonorecords of a work that have been acquired outside the United States is an infringe- ment of the exclusive right to distribute copies or phonorecords under section 106, actionable under sec tion 501.” In Quality Distributors, the Court held that a copyright owner’s right to control importation under is a component of the distribution right set forth in and is therefore subject to codification of the first sale doctrine. Quality thus held that the importation of copies made in the United States but sold abroad did not rank as copyright infringement under at See also (GINSBURG, J., concurring) (Quality “involve[d] a ‘round trip’ journey, travel of the copies in question from the United States to places abroad, then back again”).2 —————— 1 In 2008, Congress renumbered what was previously as See Prioritizing Resources and Organization for Intellectual Property Act of 2008 (PROIPA), Like the Court, I refer to the provision by its current numbering. 2 Although JUSTICE KAGAN’s concurrence suggests that Quality erred in “holding that limits” ante, that recent, unanimous holding must be taken as a given. See John R. Sand & Gravel (“[S]tare decisis in respect to statutory interpretation has ‘special force,’ for ‘Congress 4 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting Important to the Court’s holding, the copies at issue in Quality had been “ ‘lawfully made under [Title 17]’ ”—a prerequisite for application of n. 9 (quoting ). Section 602(a)(1), the Court noted, would apply to “copies that were ‘lawfully made’ not under the United States Copyright Act, but instead, under the law of some other country.” Drawing on an example discussed during a 1964 public meeting on pro posed revisions to the U. S. copyright laws,3 the Court stated: “If the author of [a] work gave the exclusive United States distribution rights—enforceable under the Act—to the publisher of the United States edition and the exclusive British distribution rights to the pub lisher of the British edition, presumably only those [copies] made by the publisher of the United States edition would be ‘lawfully made under this title’ within the meaning of The first sale doctrine would not provide the publisher of the British edition who decided to sell in the American market with a de fense to an action under )). The Court’s objective in this case should be to avoid unduly “constrict[ing] the scope of ban on unauthorized importation,” ante, at 1 (opinion of KAGAN, J.), while at the same time remaining faithful to Quality ’s holding and to the text and history of other Copyright Act provisions. This aim is not difficult to achieve. See Parts II–V, infra. JUSTICE KAGAN and I appear to agree to this extent: Congress meant the ban on unauthorized importation to have real force. See ante, at 3 (acknowl edging that “Wiley may have a point about what was de signed to do”). 3 See Quality Distributors, Inc. v. L’anza Research Int’l, Inc., 5 U.S. 148, n. 20 (quoting Copyright Law Revision Part 4: Further Discussions and Comments on Preliminary Draft for Revised U. S. Copyright Law, 88th Cong., 2d Sess., 119 (H. R. Judiciary Comm. Print 1964) (hereinafter Copyright Law Revision Part 4) (statement of Harriet Pilpel)). Cite as: 568 U. S. (2013) 5 GINSBURG, J., dissenting to an action under if there was a distribution of the copies).” As the District Court and the Court of Appeals concluded, see ; App. to Pet. for Cert. 70a–73a, application of the Quality analysis to the facts of this case would preclude any invocation of Petitioner Supap Kirtsaeng imported and then sold at a profit over 600 copies of copyrighted textbooks printed outside the United States by the Asian subsidiary of respondent John Wiley & Sons, Inc. (Wiley). App. 29– 34. See also ante, at 3–5 (opinion of the Court). In the words the Court used in Quality these copies “were ‘lawfully made’ not under the United States Copyright Act, but instead, under the law of some other country.” 5 U.S., Section 109(a) therefore does not ap- ply, and Kirtsaeng’s unauthorized importation constitutes copyright infringement under The Court does not deny that under the language I have quoted from Quality Wiley would prevail. Ante, at 27. Nevertheless, the Court dismisses this language, to which all Members of the Quality Court subscribed, as ill-considered dictum. Ante, 7–28. I agree that the discussion was dictum in the sense that it was not essen tial to the Court’s judgment. See Quality 5 U.S., (GINSBURG, J., concurring) (“[W]e do not today resolve cases in which the allegedly infringing imports were manufactured abroad.”). But I disagree with the Court’s conclusion that this dictum was ill considered. Instead, for the reasons explained below, I would hold, consistently with Quality ’s dictum, that authorizes a copyright owner to bar the importation of a copy manufactured abroad for sale abroad. II The text of the Copyright Act demonstrates that Con gress intended to provide copyright owners with a potent 6 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting remedy against the importation of foreign-made copies of their copyrighted works. As the Court recognizes, ante, at 3, this case turns on the meaning of the phrase “lawfully made under this title” in In my view, that phrase is most sensibly read as referring to instances in which a copy’s creation is governed by, and conducted in compli ance with, Title 17 of the U. S. Code. This reading is consistent with the Court’s interpretation of similar lan guage in other statutes. See Florida Dept. of Revenue v. Piccadilly Cafeterias, Inc., (“under” in 11 U.S. C. a Bankruptcy Code provi sion exempting certain asset transfers from stamp taxes, means “pursuant to”); (1991) (the phrase “under section 554” in the Equal Access to Justice Act means “subject to” or “governed by” 5 U.S. C. (internal quotation marks omitted)). It also accords with dictionary definitions of the word “under.” See, e.g., American Heritage Dictionary 1887 (“under” means, among other things, “[s]ubject to the authority, rule, or control of ”). Section 109(a), properly read, affords Kirtsaeng no defense against Wiley’s claim of copyright infringement. The Copyright Act, it has been observed time and again, does not apply extraterritorially. See United Dictionary (copyright statute requiring that U. S. copyright notices be placed in all copies of a work did not apply to copies pub lished abroad because U. S. copyright laws have no “force” beyond the United States’ borders); 4 M. Nimmer & D. Nimmer, Copyright p. 17–18 (2012) (hereinafter Nimmer) (“[C]opyright laws do not have any extraterrito rial operation.”); 4 W. Patry, Copyright p. 13–66 (2012) (hereinafter Patry) (“Copyright laws are rigor- ously territorial.”). The printing of Wiley’s foreign manufactured textbooks therefore was not governed by Title 17. The textbooks thus were not “lawfully made Cite as: 568 U. S. (2013) 7 GINSBURG, J., dissenting under [Title 17],” the crucial precondition for application of And if does not apply, there is no dis pute that Kirtsaeng’s conduct constituted copyright in fringement under The Court’s point of departure is similar to mine. Ac cording to the Court, the phrase “ ‘lawfully made under this title’ means made ‘in accordance with’ or ‘in compli ance with’ the Copyright Act.” Ante, at 8. But the Court overlooks that, according to the very dictionaries it cites, ante, at 9, the word “under” commonly signals a relation ship of subjection, where one thing is governed or regu- lated by another. See Black’s Law Dictionary 1525 (6th ed. 1990) (“under” “frequently” means “inferior” or “subordi nate” (internal quotation marks omitted)); 18 Oxford English Dictionary 950 (“under” means, among other things, “[i]n accordance with (some regulative power or principle)” (emphasis added)). See also Webster’s Third New International Dictionary 2487 (1961) (“under” means, among other things, “in a condition of sub- jection, regulation, or subordination” and “suffering re striction, restraint, or control by”). Only by disregarding this established meaning of “under” can the Court arrive at the conclusion that Wiley’s foreign-manufactured text books were “lawfully made under” U. S. copyright law, even though that law did not govern their creation. It is anomalous, however, to speak of particular conduct as “lawful” under an inapplicable law. For example, one might say that driving on the right side of the road in England is “lawful” under U. S. law, but that would be so only because U. S. law has nothing to say about the sub ject. The governing law is English law, and English law demands that driving be done on the left side of the road.4 —————— 4 The Court asserts that my position gives the word “lawfully” in “little, if any, linguistic work to do.” Ante, at 9. That is not so. My reading gives meaning to each word in the phrase “lawfully made 8 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting The logical implication of the Court’s definition of the word “under” is that any copy manufactured abroad—even a piratical one made without the copyright owner’s author ization and in violation of the law of the country where it was created—would fall within the scope of Any such copy would have been made “in accordance with” or “in compliance with” the U. S. Copyright Act, in the sense that manufacturing the copy did not violate the Act (be cause the Act does not apply extraterritorially). The Court rightly refuses to accept such an absurd conclusion. Instead, it interprets as applying only to copies whose making actually complied with Title 17, or would have complied with Title 17 had Title 17 been ap plicable (i.e., had the copies been made in the United States). See ante, at 8 (“ ‘first sale’ doctrine would apply to copyrighted works as long as their manufacture met the requirements of American copyright law.”). Con gress, however, used express language when it called for such a counterfactual inquiry in 17 U.S. C. §(2) and (b). See (2) (“Importation into the United States or exportation from the United States, without the authority of the owner of copyright under this title, of copies or phonorecords, the making of which either consti tuted an infringement of copyright, or which would have constituted an infringement of copyright if this title had been applicable, is an infringement of the exclusive right to distribute copies or phonorecords under section 106.” (emphasis added)); (“In a case where the making —————— under this title.” The word “made” signifies that the conduct at issue is the creation or manufacture of a copy. See Webster’s Third New International Dictionary 6 (1961) (defining “made” as “artificially produced by a manufacturing process”). The word “lawfully” indicates that for to apply, the copy’s creation must have complied with some body of law. Finally, the prepositional phrase “under this title” clarifies what that body of law is—namely, the copyright prescriptions contained in Title 17 of the U. S. Code. Cite as: 568 U. S. (2013) 9 GINSBURG, J., dissenting of the copies or phonorecords would have constituted an infringement of copyright if this title had been applicable, their importation is prohibited.” (emphasis added)). Had Congress intended courts to engage in a similarly hypo thetical inquiry under Congress would pre sumably have included similar language in that section. See ; brackets in original)).5 —————— 5 Attempting to show that my reading of is susceptible to the same criticism, the Court points to the now-repealed “manufacturing clause,” which required “copies of a work consisting preponderantly of nondramatic literary material in the English language” to be “manufactured in the United States or Canada.” Copyright Act of 1976, Because Congress expressly referred to manu facturing in this provision, the Court contends, the phrase “lawfully made under this title” in cannot mean “manufactured in the United States.” Ante, at 19. This argument is a non sequitur. I do not contend that the phrases “lawfully made under this title” and “manu factured in the United States” are interchangeable. To repeat, I read the phrase “lawfully made under this title” as referring to instances in which a copy’s creation is governed by, and conducted in compliance with, Title 17 of the U. S. Code. See Not all copies “manu factured in the United States” will satisfy this standard. For example, piratical copies manufactured in the United States without the copy right owner’s authorization are not “lawfully made under [Title 17].” Nor would the phrase “lawfully manufactured in the United States” be an exact substitute for “lawfully made under this title.” The making of a copy may be lawful under Title 17 yet still violate some other provi sion of law. Consider, for example, a copy made with the copyright owner’s authorization by workers who are paid less than minimum wage. The copy would be “lawfully made under [Title 17]” in the sense that its creation would not violate any provision of that title, but the copy’s manufacturing would nonetheless be unlawful due to the viola 10 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting Not only does the Court adopt an unnatural construc tion of the phrase “lawfully made under this title.” Concomitantly, the Court reduces to insignifi cance. As the Court appears to acknowledge, see ante, at 26, the only independent effect has under to day’s decision is to prohibit unauthorized importations carried out by persons who merely have possession of, but do not own, the imported copies. See 17 U.S. C. ( applies to any “owner of a particular copy or phonorecord lawfully made under this title” (emphasis added)).6 If this is enough to avoid rendering entirely “superfluous,” ante, 6, it hardly suffices to give the owner’s importation right the scope Congress intended it to have. Congress used broad language in ; it did so to achieve a broad objective. Had Congress intended simply to provide a copyright remedy against larcenous lessees, licensees, consignees, and bailees of films and other copyright-protected goods, see ante, at 13–14, 26, it likely would have used language tailored to that narrow purpose. See 2 Nimmer at 8–184.31, n. 432 (“It may be wondered whether potential causes of action [against licensees and the like] are more than theo retical.”). See also ante, (KAGAN, J., concurring) (the Court’s decision limits “to a fairly esoteric set of —————— tion of the minimum-wage laws. 6 When was originally enacted in 1976, it played an addi tional role—providing a private cause of action against importers of piratical goods. See Quality 5 U.S., at 146. In 2008, however, Congress amended to provide for such a cause of action in (2), which prohibits the unauthorized “[i]mportation into the United States of copies or phonorecords, the making of which either constituted an infringement of copyright, or which would have consti tuted an infringement of copyright if [Title 17] had been applicable.” See PROIPA, –4260. Thus, under the Court’s interpretation, the only conduct reached by but not (2) is a nonowner’s unauthorized importation of a nonpiratical copy. Cite as: 568 U. S. (2013) 11 GINSBURG, J., dissenting applications”).7 The Court’s decision also overwhelms 17 U.S. C. (3)’s exceptions to importation prohibi tion. 2 P. Goldstein, Copyright p. 7:141 (3d ed. 2012) (hereinafter Goldstein).8 Those exceptions permit the importation of copies without the copyright owner’s authorization for certain governmental, personal, schol- arly, educational, and religious purposes. 17 U.S. C. (3). Copies imported under these exceptions “will often be lawfully made gray market goods purchased through normal market channels abroad.” 2 Goldstein —————— 7 Notably, the Court ignores the history of which reveals that the primary purpose of the prescription was not to provide a remedy against rogue licensees, consignees, and bailees, against whom copyright owners could frequently assert breach-of-contract claims even in the absence of Instead, the primary purpose of was to reach third-party importers, enterprising actors like Kirtsaeng, against whom copyright owners could not assert contract claims due to lack of privity. See Part III, infra. 8 Section 602(a)(3) provides: “This subsection [i.e., ] does not apply to— “(A) importation or exportation of copies or phonorecords under the authority or for the use of the Government of the United States or of any State or political subdivision of a State, but not including copies or phonorecords for use in schools, or copies of any audiovisual work imported for purposes other than archival use; “(B) importation or exportation, for the private use of the importer or exporter and not for distribution, by any person with respect to no more than one copy or phonorecord of any one work at any one time, or by any person arriving from outside the United States or departing from the United States with respect to copies or phonorecords forming part of such person’s personal baggage; or “(C) importation by or for an organization operated for scholarly, educational, or religious purposes and not for private gain, with respect to no more than one copy of an audiovisual work solely for its archival purposes, and no more than five copies or phonorecords of any other work for its library lending or archival purposes, unless the importation of such copies or phonorecords is part of an activity consisting of sys tematic reproduction or distribution, engaged in by such organization in violation of the provisions of section 108(g)(2).” 12 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting at 7:141.9 But if, as the Court holds, such copies can in any event be imported by virtue of (3)’s work has already been done. For example, had Congress conceived of sweep as the Court does, what earthly reason would there be to provide, as Congress did in (3)(C), that a library may import “no more than five copies” of a non-audiovisual work for its “lending or archival purposes”? The far more plausible reading of § and 602(a), then, is that Congress intended to apply to copies made in the United States, not to copies manufactured and sold abroad. That reading of the first sale and impor tation provisions leaves (3)’s exceptions with real, meaningful work to do. See TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001) (“It is a cardinal principle of statutory construction that a statute ought, upon the whole, to be so construed that, if it can be prevented, no clause, sen tence, or word shall be superfluous, void, or insignificant.” (internal quotation marks omitted)). In the range of circum stances covered by the exceptions, (3) frees indi viduals and entities who purchase foreign-made copies abroad from the requirement they would otherwise face under of obtaining the copyright owner’s per mission to import the copies into the United States.10 —————— 9 The term “gray market good” refers to a good that is “imported out side the distribution channels that have been contractually negotiated by the intellectual property owner.” Forsyth & Rothnie, Parallel Imports, in The Interface Between Intellectual Property Rights and Competition Policy 429 Such goods are also commonly called “parallel imports.” 10 The Court asserts that its reading of is bolstered by which extends the copyright “protection[s]” of Title 17 to a wide variety of foreign works. See ante, at 10–11. The “protection under this title” afforded by however, is merely protection against infringing conduct within the United States, the only place where Title 17 applies. See 4 W. Patry, Copyright pp. 13–128 to 13–129 (2012) (hereinafter Patry). Thus, my reading of the phrase “under this title” in Cite as: 568 U. S. (2013) 13 GINSBURG, J., dissenting III The history of reinforces the conclusion I draw from the text of the relevant provisions: does not apply to copies manufactured abroad. Section 602(a)(1) was enacted as part of the Copyright Act of 1976, –2590. That Act was the product of a lengthy revision effort overseen by the U. S. Copyright Office. See Mills Music, In its initial 1961 report on recommended revisions, the Copyright Office noted that publishers had “suggested that the [then-existing] import ban on piratical copies should be extended to bar the importation of foreign edition[s]” in violation of “agreements to divide interna tional markets for copyrighted works.” Copyright Law Revision: Report of the Register of Copyrights on the General Revision of the U. S. Copyright Law, 87th Cong., 1st Sess., 126 (H. R. Judiciary Comm. Print 1961) (herein after Copyright Law Revision). See Copyright Act of 1947, (“The importation into the United States of any piratical copies of any work copyrighted —————— is consistent with Congress’ use of that phrase in Fur thermore, describes which works are entitled to copyright protec tion under U. S. law. But no one disputes that Wiley’s copyrights in the works at issue in this case are valid. The only question is whether Kirtsaeng’s importation of copies of those works infringed Wiley’s copyrights. It is basic to copyright law that “[o]wnership of a copyright is distinct from ownership of any material object in which the work is embodied.” 17 U.S. C. See also (“ ‘Copies’ are material objects, other than phonorecords, in which a work is fixed by any method now known or later developed, and from which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.”). Given the distinction copyright law draws between works and copies, is inapposite to the question here presented. 4 Patry at 13–129 (“There is no connection, linguistically or substantively, between Section[s] 104 and 109: Section 104 deals with national eligibility for the intangible work of authorship; Section 109(a) deals with the tangible, physical embodiment of the work, the ‘copy.’ ”). 14 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting in the United States is prohibited.”). The Copyright Office originally recommended against such an extension of the importation ban, reasoning that enforcement of territorial restrictions was best left to contract law. Copy right Law Revision 126. Publishing-industry representatives argued strenuously against the position initially taken by the Copyright Of fice. At a 1962 panel discussion on the Copyright Office’s report, for example, Horace Manges of the American Book Publishers Council stated: “When a U. S. book publisher enters into a contract with a British publisher to acquire exclusive U. S. rights for a particular book, he often finds that the English edition of that particular book finds its way into this country. Now it’s all right to say, ‘Com mence a lawsuit for breach of contract.’ But this is expensive, burdensome, and, for the most part, inef fective.” Copyright Law Revision Part 2: Discussion and Comments on Report of the Register of Copy rights on the General Revision of the U. S. Copyright Law, 88th Cong., 1st Sess., 212 (H. R. Judiciary Comm. Print 1963). Sidney Diamond, representing London Records, elabo rated on Manges’ statement. “There are many situations,” he explained, “in which it is not necessarily a question of the inadequacy of a contract remedy—in the sense that it may be difficult or not quick enough to solve the particular problem.” “Very frequently,” Diamond stated, publishers “run into a situation where copies of [a] work produced in a foreign country may be shipped [to the United States] without violating any contract of the U. S. copyright proprietor.” To illustrate, Diamond noted, if a “British publisher [sells a copy] to an individual who in turn ship[s] it over” to the United States, the indi vidual’s conduct would not “violate [any] contract between Cite as: 568 U. S. (2013) 15 GINSBURG, J., dissenting the British and the American publisher.” In such a case, “no possibility of any contract remedy” would exist. The facts of Kirtsaeng’s case fit Diamond’s example, save that the copies at issue here were printed and ini- tially sold in Asia rather than Great Britain. After considering comments on its 1961 report, the Copyright Office “prepared a preliminary draft of provi sions for a new copyright statute.” Copyright Law Revi sion Part 3: Preliminary Draft for Revised U. S. Copyright Law and Discussions and Comments on the Draft, 88th Cong., 2d Sess., V (H. R. Judiciary Comm. Print 1964). Section 44 of the draft statute addressed the concerns raised by publishing-industry representatives. In particu lar, provided: “Importation into the United States of copies or rec ords of a work for the purpose of distribution to the public shall, if such articles are imported without the authority of the owner of the exclusive right to dis tribute copies or records under this title, constitute an infringement of copyright actionable under section 35 [i.e., the section providing for a private cause of action for copyright infringement].” at 32–33. In a 1964 panel discussion regarding the draft statute, Abe Goldman, the Copyright Office’s General Counsel, left no doubt about the meaning of It represented, he explained, a “shif[t]” from the Copyright Office’s 1961 report, which had recommended against using copyright law to facilitate publishers’ efforts to segment interna tional markets. Copyright Law Revision Part 4: Further Discussions and Comments on Preliminary Draft for Revised U. S. Copyright Law, 88th Cong., 2d Sess., 203 (H. R. Judiciary Comm. Print 1964). Section 44(a), Gold man stated, would allow copyright owners to bring in fringement actions against importers of “foreign copies that were made under proper authority.” See also 16 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting 05–206 (Goldman agreed with a speaker’s com ment that “enlarge[d]” U. S. copyright law by ex tending import prohibitions “to works legally produced in Europe” and other foreign countries).11 The next step in the copyright revision process was the introduction in Congress of a draft bill on July 20, 1964. See Copyright Law Revision Part 5: 1964 Revision Bill with Discussions and Comments, 89th Cong., 1st Sess., III (H. R. Judiciary Comm. Print 1965). After another round of public comments, a revised bill was introduced on Feb ruary 4, 1965. See Copyright Law Revision Part 6: Sup plementary Report of the Register of Copyrights on the General Revision of the U. S. Copyright Law: 1965 Revi sion Bill, 89th Cong., 1st Sess., V (H. R. Judiciary Comm. Print 1965) (hereinafter Copyright Law Revision Part 6). In language closely resembling the statutory text later enacted by Congress, of the 1965 bill provided: “Importation into the United States, without the au thority of the owner of copyright under this title, of copies or phonorecords of a work for the purpose of distribution to the public is an infringement of the ex clusive right to distribute copies or phonorecords un der section 106, actionable under section 501.” at 292.12 —————— 11 As the Court observes, ante, 9, Irwin Karp of the Authors League of America stated at the 1964 panel discussion that ran counter to “the very basic concept of copyright law that, once you’ve sold a copy legally, you can’t restrict its resale.” Copyright Law Revision Part 4, 12. When asked if he was “presenting an argument against” however, Karp responded that he was “neutral on th[e] provision.” There is thus little reason to believe that any changes to the wording of before its codification in were made in response to Karp’s discussion of “the problem of restricting [the] transfer of lawfully obtained [foreign] copies.” 12 There is but one difference between this language from the 1965 bill and the corresponding language in the current version of : Cite as: 568 U. S. (2013) 17 GINSBURG, J., dissenting The Court implies that the 1965 bill’s “explici[t] re fer[ence] to showed a marked departure from of the Copyright Office’s prior draft. Ante, 9. The Copyright Office, however, did not see it that way. In its summary of the 1965 bill’s provisions, the Copyright Office observed that of the 1965 bill, like of the Copyright Office’s prior draft, see at 15–16, permit ted copyright owners to bring infringement actions against unauthorized importers in cases “where the copyright owner had authorized the making of [the imported] copies in a foreign country for distribution only in that country.” Copyright Law Revision Part 6, at 1–150. See also at XXVI (Under of the 1965 bill, “[a]n unauthorized importer could be enjoined and sued for damages both where the copies or phonorecords he was importing were ‘piratical’ (that is, where their making would have constituted an infringement if the U. S. copyright law could have been applied), and where their making was ‘lawful.’ ”). The current text of was finally enacted into law in 1976. See Copyright Act of 1976, 90 Stat. 2589–2590. The House and Senate Committee Reports on the 1976 Act demonstrate that Congress understood, as did the Copyright Office, just what that text meant. Both Reports state: “Section 602 [deals] with two separate situations: im portation of ‘piratical’ articles (that is, copies or phonorecords made without any authorization of the —————— In the current version, the phrase “for the purpose of distribution to the public” is omitted and the phrase “that have been acquired outside the United States” appears in its stead. There are no material differences between the quoted language from the 1965 bill and the corresponding language contained in the 1964 bill. See Copyright Law Revision Part 6: Supplementary Report of the Register of Copyrights on the General Revision of the U. S. Copyright Law: 1965 Revision Bill, 89th Cong., 1st Sess., 292–293 (H. R. Judiciary Comm. Print 1965). 18 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting copyright owner), and unauthorized importation of copies or phonorecords that were lawfully made. The general approach of section 602 is to make unauthor- ized importation an act of infringement in both cases, but to permit the Bureau of Customs to prohibit im portation only of ‘piratical’ articles.” S. Rep. No. 94– 473, p. 151 (1975) (emphasis added). See also H. R. Rep. No. 94–1476, p. 169 (1976) (same). In sum, the legislative history of the Copyright Act of 1976 is hardly “inconclusive.” Ante, 8. To the con trary, it confirms what the plain text of the Act conveys: Congress intended to provide copyright owners with a remedy against the unauthorized importation of foreign-made copies of their works, even if those copies were made and sold abroad with the copyright owner’s authorization.13 IV Unlike the Court’s holding, my position is consistent with the stance the United States has taken in international trade negotiations. This case bears on the highly con tentious trade issue of interterritorial exhaustion. The issue arises because intellectual property law is territorial in nature, see which means that creators of intellectual property “may hold a set of parallel” intellec tual property rights under the laws of different nations. Chiappetta, The Desirability of Agreeing to Disagree: The WTO, TRIPS, International IPR Exhaustion and a Few Other Things, 21 Mich. J. Int’l L. 333, 340–341 (2000) (hereinafter Chiappetta). There is no international con —————— 13 The Court purports to find support for its position in the House and Senate Committee Reports on the 1976 Copyright Act. Ante, at 30–31. It fails to come up with anything in the Act’s legislative history, how ever, showing that Congress understood the words “lawfully made under this title” in to encompass foreign-made copies. Cite as: 568 U. S. (2013) 19 GINSBURG, J., dissenting sensus on whether the sale in one country of a good in- corporating protected intellectual property exhausts the intellectual property owner’s right to control the distribu tion of that good elsewhere. Indeed, the members of the World Trade Organization, “agreeing to disagree,”14 pro vided in Article 6 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), Apr. 15, 1994, 33 I. L. M. 1197, 1200, that “nothing in this Agree ment shall be used to address the issue of exhaustion.” See Chiappetta 346 (observing that exhaustion of intellec tual property rights was “hotly debated” during the TRIPS negotiations and that Article 6 “reflects [the negotiators’] ultimate inability to agree” on a single international standard). Similar language appears in other treaties to which the United States is a party. See World Intellectual Property Organization (WIPO) Copyright Treaty, Art. 6(2), Dec. 20, 1996, S. Treaty Doc. No. 105–17, p. 7 (“Nothing in this Treaty shall affect the freedom of Contracting Parties to determine the conditions, if any, under which the ex haustion of the right [to control distribution of copies of a copyrighted work] applies after the first sale or other transfer of ownership of the original or a copy of the work with the authorization of the author.”); WIPO Perfor mances and Phonograms Treaty, Art. 8(2), Dec. 20, 1996, S. Treaty Doc. No. 105–17, p. 28 (containing language nearly identical to Article 6(2) of the WIPO Copyright Treaty). In the absence of agreement at the international level, each country has been left to choose for itself the exhaus tion framework it will follow. One option is a national exhaustion regime, under which a copyright owner’s right —————— 14 Chiappetta,The Desirability of Agreeing to Disagree: The WTO, TRIPS, International IPR Exhaustion and a Few Other Things, 21 Mich. J. Int’l L. 333, 340 (2000) (hereinafter Chiappetta) (internal quotation marks omitted). 20 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting to control distribution of a particular copy is exhausted only within the country in which the copy is sold. See Forsyth & Rothnie, Parallel Imports, in The Interface Between Intellectual Property Rights and Competition Policy 429, 430 (hereinafter Forsyth & Rothnie). Another option is a rule of international exhaustion, under which the authorized distribution of a particular copy anywhere in the world exhausts the copy right owner’s distribution right everywhere with respect to that copy. See The European Union has adopted the intermediate approach of regional exhaustion, under which the sale of a copy anywhere within the European Economic Area exhausts the copyright owner’s distribu tion right throughout that region. See Section 602(a)(1), in my view, ties the United States to a national-exhaustion framework. The Court’s decision, in con- trast, places the United States solidly in the international exhaustion camp. Strong arguments have been made both in favor of, and in opposition to, international exhaustion. See Chiappetta 360 (“[r]easonable people making valid points can, and do, reach conflicting conclusions” regarding the desirability of international exhaustion). International exhaustion subjects copyright-protected goods to competition from lower priced imports and, to that extent, benefits con- sumers. Correspondingly, copyright owners profit from a national-exhaustion regime, which also enlarges the mon etary incentive to create new copyrightable works. See Forsyth & Rothnie 432–437 (surveying arguments for and against international exhaustion). Weighing the competing policy concerns, our Govern ment reached the conclusion that widespread adoption of the international-exhaustion framework would be incon sistent with the long-term economic interests of the United States. See Brief for United States as Amicus Curiae in Quality O. T. 1997, No. 96–1470, pp. 22–26 (herein Cite as: 568 U. S. (2013) 21 GINSBURG, J., dissenting after Quality Brief).15 Accordingly, the United States has steadfastly “taken the position in international trade negotiations that domestic copyright owners should have the right to prevent the unauthorized importation of copies of their work sold abroad.” The United States has “advanced this position in multilateral trade negotiations,” including the negotiations on the TRIPS Agreement. See also D. Gervais, The TRIPS Agreement: Drafting History and Analysis p. 199 It has also taken a dim view of our trading partners’ adoption of legislation incorporating elements of international exhaustion. See Clapperton & Corones, Locking in Customers, Locking Out Competitors: Anti- Circumvention Laws in Australia and Their Potential Effect on Competition in High Technology Markets, 30 Melbourne U. L. Rev. 657, 664 (2006) (United States expressed concern regarding international-exhaustion leg- islation in Australia); Montén, Comment, The Inconsistency Between Section 301 and TRIPS: Counterproductive With Respect to the Future of International Protection of Intellectual Property Rights? 9 Marq. Intellectual —————— 15 The Court states that my “reliance on the Solicitor General’s posi tion in Quality is undermined by his agreement in that case with [the] reading of ” that the Court today adopts. Ante, at 33. The United States’ principal concern in both Quality and this case, however, has been to protect copyright owners’ “right to prevent paral lel imports.” Brief for United States as Amicus Curiae in Quality O. T. 1997, No. 96–1470, p. 6 (hereinafter Quality Brief). See also Brief for United States as Amicus Curiae 14 (arguing that Kirtsaeng’s interpretation of which the Court adopts, would “subver[t] Section 602(a)(1)’s ban on unauthorized importation”). In Quality the Solicitor General urged this Court to hold that codification of the first sale doctrine does not limit the right to control importation set forth in Quality Brief 7–30. After Quality rejected that contention, the United States reconsidered its position, and it now endorses the interpretation of the phrase “lawfully made under this title” I would adopt. Brief for United States as Amicus Curiae 6–7, 13–14. 22 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting Property L. Rev. 387, 417–418 (2005) (same with respect to New Zealand and Taiwan). Even if the text and history of the Copyright Act were am- biguous on the answer to the question this case presents— which they are not, see Parts II–III, supra16—I would resist a holding out of accord with the firm position the United States has taken on exhaustion in internation al negotiations. Quality I acknowledge, discounted the Government’s concerns about potential inconsistency with United States obligations under certain bilateral trade agreements. See 5 U.S., at 153–154. See also Quality Brief 22–24 (listing the agreements). That decision, however, dealt only with copyright-protected products made in the United States. See 5 U.S., (GINSBURG, J., concurring). Quality left open the question whether owners of U. S. copyrights could retain control over the importation of copies manufactured and sold abroad—a point the Court obscures, see ante, at 33 (arguing that Quality “significantly eroded” the national-exhaustion principle that, in my view, embraces). The Court today answers that question with a resounding “no,” and in doing so, it risks undermining the United States’ credibility on the world stage. While the Government has urged our trading partners to refrain from adopting international-exhaustion regimes that could benefit consumers within their borders but would impact adversely on intellectual-property producers in the United States, the Court embraces an international-exhaustion rule that could benefit U. S. consumers but would likely —————— 16 Congress hardly lacks capacity to provide for international exhaus tion when that is its intent. Indeed, Congress has expressly provided for international exhaustion in the narrow context of semiconductor chips embodying protected “mask works.” See 17 U.S. C. 906(b). See also 2 M. Nimmer & D. Nimmer, Copyright p. 8A–37 (2012) (hereinafter Nimmer) (“[T]he first sale doctrine under expressly immunizes unauthorized importation.”). Cite as: 568 U. S. (2013) GINSBURG, J., dissenting disadvantage foreign holders of U. S. copyrights. This dissonance scarcely enhances the United States’ “role as a trusted partner in multilateral endeavors.” Vimar Seguros y Reaseguros, S. 539 (1995). V I turn now to the Court’s justifications for a decision difficult to reconcile with the Copyright Act’s text and history. A The Court asserts that its holding “is consistent with antitrust laws that ordinarily forbid market divisions.” Ante, at 32. See also ante, at 18 (again referring to anti trust principles). Section 602(a)(1), however, read as I do and as the Government does, simply facilitates copyright owners’ efforts to impose “vertical restraints” on distribu tors of copies of their works. See Forsyth & Rothnie 435 (“Parallel importation restrictions enable manufacturers and distributors to erect ‘vertical restraints’ in the market through exclusive distribution agreements.”). See gener- ally Leegin Creative Leather Products, We have held that vertical restraints are not per se illegal under of the Sherman Act, 15 U.S. C. because such “restraints can have procompetitive effects.” 551 U.S., at 881–882.17 —————— 17 Despite the Court’s suggestion to the contrary, this case in no way implicates the per se antitrust prohibition against horizontal “ ‘[a]greements between competitors to allocate territories to minimize competition.’ ” Ante, at 32 (quoting Palmer v. BRG of Ga., Inc., 8 U.S. 46, (1990) ). Wiley is not requesting authority to enter into collusive agreements with other textbook publishers that would, for example, make Wiley the exclusive supplier of textbooks on particular subjects within particular geographic regions. Instead, Wiley asserts no more than the prerogative to impose vertical restraints 24 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting B The Court sees many “horribles” following from a hold ing that the phrase “lawfully made under this title” does not encompass foreign-made copies. Ante, (internal quotation marks omitted). If excluded foreign-made copies, the Court fears, then copyright own ers could exercise perpetual control over the downstream distribution or public display of such copies. A ruling in Wiley’s favor, the Court asserts, would shutter libraries, put used-book dealers out of business, cripple art muse ums, and prevent the resale of a wide range of consumer goods, from cars to calculators. Ante, at 19–22. See also ante, –3 (KAGAN, J., concurring) (expressing concern about “imposing downstream liability on those who pur chase and resell in the United States copies that happen to have been manufactured abroad”). Copyright law and precedent, however, erect barriers to the anticipated horribles.18 1 Recognizing that foreign-made copies fall outside the ambit of would not mean they are forever free of the first sale doctrine. As earlier observed, see the Court stated that doctrine initially in its 1908 Bobbs- —————— on the distribution of its own textbooks. See Hovenkamp, Post-Sale Restraints and Competitive Harm: The First Sale Doctrine in Perspec tive, 66 N. Y. U. Ann. Survey Am. L. 487, 488 (“vertical re straints” include “limits [on] the way a seller’s own product can be distributed”). 18 As the Court observes, ante, at 32–33, the United States stated at oral argument that the types of “horribles” predicted in the Court’s opinion would, if they came to pass, be “worse than the frustration of market segmentation” that will result from the Court’s interpretation of Tr. of Oral Arg. 51. The United States, however, recognized that this purported dilemma is a false one. As the United States explained, the Court’s horribles can be avoided while still giving mean ingful effect to ban on unauthorized importation. Cite as: 568 U. S. (2013) 25 GINSBURG, J., dissenting Merrill decision. At that time, no statutory provision expressly codified the first sale doctrine. Instead, copy right law merely provided that copyright owners had “the sole liberty of printing, reprinting, publishing, completing, copying, executing, finishing, and vending” their works. Copyright Act of 1891, In Bobbs-Merrill, the Court addressed the scope of the statutory right to “ven[d].” In granting that right, the Court held, Congress did not intend to permit copyright owners “to fasten a restriction upon the subsequent alienation of the subject-matter of copyright after the owner had parted with the title to one who had acquired full dominion over it and had given a satisfactory price for it.” –350. “[O]ne who has sold a copy righted article without restriction,” the Court ex plained, “has parted with all right to control the sale of it.” Thus, “[t]he purchaser of a book, once sold by authority of the owner of the copyright, may sell it again, although he could not publish a new edition of it.” Under the logic of Bobbs-Merrill, the sale of a foreign manufactured copy in the United States carried out with the copyright owner’s authorization would exhaust the copyright owner’s right to “vend” that copy. The copy could thenceforth be resold, lent out, or otherwise redis tributed without further authorization from the copyright owner. Although uses the word “distribute” rather than “vend,” there is no reason to think Congress intended the word “distribute” to bear a meaning different from the construction the Court gave to the word “vend” in Bobbs- Merrill. See (emphasizing that the question before the Court was “purely [one] of statutory construction”).19 —————— 19 It appears that the Copyright Act of 1976 omitted the word “vend” and introduced the word “distribute” to avoid the “redundan[cy]” present in pre-1976 law. Copyright Law Revision: Report of the Regis ter of Copyrights on the General Revision of the U. S. Copyright Law, 87th Cong., 1st Sess., 21 (H. R. Judiciary Comm. Print 1961) (noting 26 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting Thus, in accord with Bobbs-Merrill, the first authorized distribution of a foreign-made copy in the United States exhausts the copyright owner’s distribution right under After such an authorized distribution, a library may lend, or a used-book dealer may resell, the foreign made copy without seeking the copyright owner’s permis sion. Cf. ante, at 19–21. For example, if Wiley, rather than Kirtsaeng, had imported into the United States and then sold the foreign made textbooks at issue in this case, Wiley’s dis tribution right would have been exhausted under the rationale of Bobbs-Merrill. Purchasers of the textbooks would thus be free to dispose of the books as they wished without first gaining a license from Wiley. This line of reasoning, it must be acknowledged, signifi cantly curtails the independent effect of If, as I maintain, the term “distribute” in incorporates the first sale doctrine by virtue of Bobbs-Merrill, then codification of that doctrine adds little to the regulatory regime.20 Section 109(a), however, does serve —————— that the exclusive rights to “publish” and “vend” works under the Copyright Act of 1947, (a), –653, were “redundant”). 20 My position that Bobbs-Merrill lives on as a limiting construction of the distribution right does not leave with no work to do. There can be little doubt that the books at issue in Bobbs-Merrill were published and first sold in the United States. See Bobbs-Merrill Co. v. Straus, F. 155, (the publisher claiming copy- right infringement in Bobbs-Merrill was incorporated and had its principal office in Indiana). See also Copyright Act of 1891, 26 Stat. 1107–1108 (generally prohibiting importation, even by the copyright owner, of foreign-manufactured copies of copyrighted books); 4 Patry 3:40, at 13–111 (under the Copyright Act of 1891, “copies of books by both foreign and U. S. authors had to be printed in the United States”). But cf. ante, at 18 (asserting, without acknowledging the 1891 Copy right Act’s general prohibition against the importation of foreign-made copies of copyrighted books, that the Court is unable to find any “geo graphical distinctions in Bobbs-Merrill ”). Thus, exhaustion occurs under Bobbs-Merrill only when a copy is distributed within the United Cite as: 568 U. S. (2013) 27 GINSBURG, J., dissenting as a statutory bulwark against courts deviating from Bobbs-Merrill in a way that increases copyright owners’ control over downstream distribution, and legislative history indicates that is precisely the role Congress in tended to play. Congress first codified the first sale doctrine in of the Copyright Act of 1909, 35 Stat. 1084.21 It did so, the House Committee Report on the 1909 Act explains, “in order to make clear that [Con gress had] no intention [of] enlarg[ing] in any way the construction to be given to the word ‘vend.’ ” H. R. Rep. No. 2222, 60th Cong., 2d Sess., 19 (1909). According to the Committee Report, was “not intended to change [exist ing law] in any way.” The position I have stated and explained accords with this expression of congressional intent. In enacting and its successors, I would hold, Congress did not “change existing law,” ib by strip ping the word “vend” (and thus its substitute “distribute”) of the limiting construction imposed in Bobbs-Merrill. In any event, the reading of the Copyright Act to which I subscribe honors Congress’ aim in enacting while the Court’s reading of the Act severely diminishes role. See at 10–12. My position in no way tugs against the principle underlying —i.e., that certain conduct by the copyright owner exhausts the —————— States with the copyright owner’s permission, not when it is distributed abroad. But under as interpreted in Quality any author ized distribution of a U. S.-made copy, even a distribution occurring in a foreign country, exhausts the copyright owner’s distribution right under See 5 U.S., at 145, n. 14. Section 109(a) therefore provides for exhaustion in a circumstance not reached by Bobbs-Merrill. 21 Section 41 of the 1909 Act provided: “[N]othing in this Act shall be deemed to forbid, prevent, or restrict the transfer of any copy of a copyrighted work the possession of which has been lawfully obtained.” This language was repeated without material change in of the Copyright Act of 1947, As noted above, see 17 U.S. C. sets out the current codification of the first sale doctrine. 28 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting owner’s distribution right. The Court, in contrast, fails to give meaningful effect to Congress’ manifest intent in to grant copyright owners the right to control the importation of foreign-made copies of their works. 2 Other statutory prescriptions provide further protection against the absurd consequences imagined by the Court. For example, (3)(C) permits “an organization oper ated for scholarly, educational, or religious purposes” to import, without the copyright owner’s authorization, up to five foreign-made copies of a non-audiovisual work— notably, a book—for “library lending or archival purposes.” But cf. ante, at 19–20 (suggesting that affirming the Se cond Circuit’s decision might prevent libraries from lend ing foreign-made books).22 The Court also notes that amici representing art muse ums fear that a ruling in Wiley’s favor would prevent museums from displaying works of art created abroad. Ante, (citing Brief for Association of Art Museum Directors et al.). These amici observe that a museum’s right to display works of art often depends on 17 U.S. C. 09(c). See Brief for Association of Art Museum Direc tors et al. 11–13. That provision addresses exhaustion of —————— 22 A group of amici representing libraries expresses the concern that lower courts might interpret (3)(C) as authorizing only the importing, but not the lending, of foreign-made copies of non-audiovisual works. See Brief for American Library Association et al. 20. The United States maintains, and I agree, however, that (3)(C) “is fairly (and best) read as implicitly authorizing lending, in addition to importation, of all works other than audiovisual works.” Brief for United States as Amicus Curiae 30, n. 6. Title 17 U.S. C. 09(c) provides: “Notwithstanding the provisions of section 106(5), the owner of a particular copy lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to display that copy publicly, either directly or by the projection of no more than one image at a time, to viewers present at the place where the copy is located.” Cite as: 568 U. S. (2013) 29 GINSBURG, J., dissenting a copyright owner’s exclusive right under 06(5) to publicly display the owner’s work. Because 09(c), like applies only to copies “lawfully made under this title,” amici contend that a ruling in Wiley’s favor would prevent museums from invoking 09(c) with respect to foreign-made works of art. at 11–13.24 Limiting 09(c) to U. S.-made works, however, does not bar art museums from lawfully displaying works made in other countries. Museums can, of course, seek the copy right owner’s permission to display a work. Furthermore, the sale of a work of art to a U. S. museum may carry with it an implied license to publicly display the work. See 2 Patry at 5–280 (“[C]ourts have noted the potential availability of an implied nonexclusive licens[e] when the circumstances demonstrate that the parties intended that the work would be used for a specific purpose.”). Displaying a work of art as part of a museum exhibition might also qualify as a “fair use” under 17 U.S. C. 07. Cf. Bouchat v. Baltimore Ravens Ltd. Partnership, 619 F.3d 301, 313–316 (CA4 2010) (display of copyrighted logo in museum-like exhibition constituted “fair use”). The Court worries about the resale of foreign-made consumer goods “contain[ing] copyrightable software pro grams or packaging.” Ante, 1. For example, the Court observes that a car might be programmed with diverse forms of software, the copyrights to which might be owned by individuals or entities other than the manu- facturer of the car. Must a car owner, the Court asks, obtain permission from all of these various copyright owners before reselling her car? Although this question strays far from the one presented in this case and briefed by the parties, principles of fair use and implied —————— 24 The word “copy,” as it appears in 09(c), applies to the original of a work of art because the Copyright Act defines the term “copies” to “includ[e] the material object in which the work is first fixed.” 30 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting license (to the extent that express licenses do not exist) would likely permit the car to be resold without the copy right owners’ authorization.25 Most telling in this regard, no court, it appears, has been called upon to answer any of the Court’s “horribles” in an actual case. Three decades have passed since a federal court first published an opinion reading as applicable exclusively to copies made in the United States. See Columbia Broadcasting System, summarily aff ’d, Yet Kirtsaeng and his supporting amici cite not a single case in which the owner of a consumer good authorized for sale in the United States has been sued for copyright infringe ment after reselling the item or giving it away as a gift or to charity. The absence of such lawsuits is unsurprising. Routinely suing one’s customers is hardly a best business —————— 25 Principlesof fair use and implied license may also allow a U. S. tourist “who buys a copyrighted work of art, a poster, or a bumper sticker” abroad to publicly “display it in America without the copyright owner’s further authorization.” Ante, at 15. (The tourist could lawfully bring the work of art, poster, or bumper sticker into the United States under 17 U.S. C. (3)(B), which provides that impor tation ban does not apply to “importation by any person arriving from outside the United States with respect to copies forming part of such person’s personal baggage.”). Furthermore, an individual clearly would not incur liability for infringement merely by displaying a foreign-made poster or other artwork in her home. See 06(5) (grant ing the owners of copyrights in “literary, musical, dramatic, and chore ographic works, pantomimes, and pictorial, graphic, or sculptural works” the exclusive right “to display the copyrighted work publicly” (emphasis added)). See also (a work is displayed “publicly” if it is displayed “at a place open to the public or at any place where a sub stantial number of persons outside of a normal circle of a family and its social acquaintances is gathered” (emphasis added)). Cf. 2 Nimmer at 8–192.2(1) (“[A] performance limited to members of the family and invited guests is not a public performance.” (footnote omitted)). Cite as: 568 U. S. (2013) 31 GINSBURG, J., dissenting practice.26 Manufacturers, moreover, may be hesitant to do business with software programmers taken to suing consumers. Manufacturers may also insist that soft ware programmers agree to contract terms barring such lawsuits. The Court provides a different explanation for the absence of the untoward consequences predicted in its opinion—namely, that lower court decisions regarding the scope of first sale prescription have not been uniform. Ante, at Uncertainty generated by these conflicting decisions, the Court notes, may have deterred some copyright owners from pressing infringement claims. Ante, at –24. But if, as the Court suggests, there are a multitude of copyright owners champing at the bit to bring lawsuits against libraries, art museums, and consumers in an effort to exercise perpetual control over the down stream distribution and public display of foreign-made copies, might one not expect that at least a handful of such lawsuits would have been filed over the past 30 years? The absence of such suits indicates that the “practical problems” hypothesized by the Court are greatly exagger ated. Ante,27 They surely do not warrant disregard —————— 26 Exerting extensive control over secondary markets may not always be in a manufacturer’s best interest. Carmakers, for example, often trumpet the resale value of their vehicles. See, e.g., Nolan, UD grad leads Cadillac marketing, Dayton Daily News, Apr. 2, 2009, p. A8 (“Cadillac plays up its warranty coverage and reliable resale value to prospective customers.”). If the transaction costs of reselling vehicles were to rise, consumers’ perception of a new car’s value, and thus the price they are willing to pay for such a car, might fall—an outcome hardly favorable to automobile manufacturers. 27 It should not be overlooked that the ability to prevent importation of foreign-made copies encourages copyright owners such as Wiley to offer copies of their works at reduced prices to consumers in less devel oped countries who might otherwise be unable to afford them. The Court’s holding, however, prevents copyright owners from barring the importation of such low-priced copies into the United States, where they will compete with the higher priced editions copyright owners 32 KIRTSAENG v. JOHN WILEY & SONS, INC. GINSBURG, J., dissenting ing Congress’ intent, expressed in to grant copyright owners the authority to bar the importation of foreign-made copies of their works. Cf. Hartford Under- writers Ins. 6 (2000) (“[W]hen the statute’s language is plain, the sole function of the courts—at least where the disposition required by the text is not absurd—is to enforce it accord ing to its terms.” (internal quotation marks omitted)). VI To recapitulate, the objective of statutory interpretation is “to give effect to the intent of Congress.” American Trucking 310 U.S., at Here, two congres- sional aims are evident. First, in enacting Con gress intended to grant copyright owners permission to segment international markets by barring the importation of foreign-made copies into the United States. Second, as codification of the first sale doctrine underscores, Congress did not want the exclusive distribution right conferred in to be boundless. Instead of harmonizing these objectives, the Court subordinates the first entirely to the second. It is unsurprising that none of the three major treatises on U. S. copyright law embrace the Court’s con struction of See 2 Nimmer at —————— make available for sale in this country. To protect their profit margins in the U. S. market, copyright owners may raise prices in less devel oped countries or may withdraw from such markets altogether. See Brief for United States as Amicus Curiae 26; Brief for Text and Aca demic Authors Association as Amicus Curiae 12; Brief for Association of American Publishers as Amicus Curiae 37. See also Chiappetta 357– 358 (a rule of national exhaustion “encourages entry and participation in developing markets at lower, locally more affordable prices by eliminating them as risky sources of cheaper parallel imports back into premium markets”). Such an outcome would disserve consumers—and especially students—in developing nations and would hardly advance the “American foreign policy goals” of supporting education and eco nomic development in such countries. Quality Brief 25–26. Cite as: 568 U. S. (2013) 33 GINSBURG, J., dissenting 8–184.34 to 8–184.35; 2 Goldstein at 7:141; 4 Patry § 13:44, 13:44.10. Rather than adopting the very international-exhaustion rule the United States has consistently resisted in international-trade negotiations, I would adhere to the national-exhaustion framework set by the Copyright Act’s text and history. Under that regime, codified in Kirtsaeng’s unauthorized importation of the foreign-made textbooks involved in this case infringed Wiley’s copyrights. I would therefore affirm the Second Circuit’s judgment |
Justice Ginsburg | majority | false | Thryv, Inc. v. Click-To-Call Technologies, LP | 2020-04-20T00:00:00 | null | https://www.courtlistener.com/opinion/4746632/thryv-inc-v-click-to-call-technologies-lp/ | https://www.courtlistener.com/api/rest/v3/clusters/4746632/ | 2,020 | null | null | null | null | *
Inter partes review is an administrative process in which
a patent challenger may ask the U. S. Patent and Trade-
mark Office (PTO) to reconsider the validity of earlier
granted patent claims. This case concerns a statutorily pre-
scribed limitation of the issues a party may raise on appeal
from an inter partes review proceeding.
When presented with a request for inter partes review,
the agency must decide whether to institute review. 35
U.S. C. §314. Among other conditions set by statute, if the
request comes more than a year after suit against the re-
questing party for patent infringement, “[a]n inter partes
review may not be instituted.” §315(b). “The determination
by the [PTO] Director whether to institute an inter partes
review under this section shall be final and nonappealable.”
§314(d).†
In this case, the agency instituted inter partes review in
——————
*JUSTICE THOMAS and JUSTICE ALITO join all but Part III–C of this
opinion.
† Key statutory provisions are reproduced in an appendix to this opin-
ion.
2 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion of the Court
response to a petition from Thryv, Inc., resulting in the can-
cellation of several patent claims. Patent owner Click-to-
Call Technologies, LP, appealed, contending that Thryv’s
petition was untimely under §315(b).
The question before us: Does §314(d)’s bar on judicial re-
view of the agency’s decision to institute inter partes review
preclude Click-to-Call’s appeal? Our answer is yes. The
agency’s application of §315(b)’s time limit, we hold, is
closely related to its decision whether to institute inter
partes review and is therefore rendered nonappealable by
§314(d).
I
The Patent and Trademark Office has several ways “to
reexamine—and perhaps cancel—a patent claim that it had
previously allowed.” Cuozzo Speed Technologies, LLC v.
Lee, 579 U. S. ___, ___ (2016) (slip op., at 3). Congress es-
tablished the procedure at issue here, inter partes review,
in the Leahy-Smith America Invents Act (AIA), 125 Stat.
284, enacted in 2011. See 35 U.S. C. §311 et seq. Inter
partes review allows third parties to challenge patent
claims on grounds of invalidity specified by statute.
§311(b).
For inter partes review to proceed, the agency must agree
to institute review. §314. Any person who is not the pat-
ent’s owner may file a petition requesting inter partes re-
view. §311(a). The patent owner may oppose institution of
inter partes review, asserting the petition’s “failure . . . to
meet any requirement of this chapter.” §313.
The AIA sets out prerequisites for institution. Among
them, “[t]he Director may not authorize an inter partes re-
view to be instituted unless the Director determines . . .
that there is a reasonable likelihood that the petitioner
would prevail with respect to at least 1 of the claims chal-
lenged in the petition.” §314(a). Most pertinent to this case,
Cite as: 590 U. S. ____ (2020) 3
Opinion of the Court
“[a]n inter partes review may not be instituted if the peti-
tion requesting the proceeding is filed more than 1 year af-
ter the date on which the petitioner, real party in interest,
or privy of the petitioner is served with a complaint alleging
infringement of the patent.” §315(b).
After receiving the petition and any response, the PTO
“Director shall determine whether to institute an inter
partes review under this chapter.” §314(b). The Director
has delegated institution authority to the Patent Trial and
Appeal Board (Board). 37 CFR §42.4(a) (2019). As just
noted, the federal agency’s “determination . . . whether to
institute an inter partes review under this section” is “final
and nonappealable.” 35 U.S. C. §314(d).
Upon electing to institute inter partes review, the Board
conducts a proceeding to evaluate the challenged claims’ va-
lidity. See §316. At the conclusion of the proceeding—if
review “is instituted and not dismissed”—the Board “is-
sue[s] a final written decision with respect to the patenta-
bility of ” the challenged claims. §318(a). “A party dissatis-
fied with the final written decision . . . may appeal the
decision” to the Court of Appeals for the Federal Circuit.
§319.
II
Respondent Click-to-Call owns a patent relating to a
technology for anonymous telephone calls, U. S. Patent No.
5,818,836 (’836 patent). In 2013, petitioner Thryv sought
inter partes review, challenging several of the patent’s
claims.1
In opposition, Click-to-Call urged that §315(b) barred in-
stitution of inter partes review because Thryv filed its peti-
tion too late. Click-to-Call pointed to an infringement suit
——————
1 More precisely, the petition was filed by four companies, including
YellowPages.com, LLC, and Ingenio, LLC. Through “a series of mergers,
sales, and name changes,” both became Thryv. Brief for Petitioner 8.
For simplicity, we refer to Thryv and its predecessor entities as “Thryv.”
4 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion of the Court
filed in 2001, which ended in a voluntary dismissal without
prejudice.2 In Click-to-Call’s view, that 2001 suit started
§315(b)’s one-year clock, making the 2013 petition
untimely.
The Board disagreed. Section 315(b) did not bar the in-
stitution of inter partes review, the Board concluded, be-
cause a complaint dismissed without prejudice does not
trigger §315(b)’s one-year limit. Finding no other barrier to
institution, the Board decided to institute review. After
proceedings on the merits, the Board issued a final written
decision reiterating its rejection of Click-to-Call’s §315(b)
argument and canceling 13 of the patent’s claims as obvious
or lacking novelty.
Click-to-Call appealed, challenging only the Board’s de-
termination that §315(b) did not preclude inter partes re-
view. The Court of Appeals dismissed the appeal for lack of
jurisdiction, agreeing with Thryv and the Director (who in-
tervened on appeal) that §314(d)’s bar on appeal of the in-
stitution decision precludes judicial review of the agency’s
application of §315(b). Citing our intervening decision in
Cuozzo, see infra, at 6–7, we granted certiorari, vacated the
judgment, and remanded. Click-to-Call Technologies, LP v.
Oracle Corp., 579 U. S. ___ (2016). On remand, the Court
of Appeals again dismissed the appeal on the same ground.
Thereafter, in another case, the en banc Federal Circuit
held that “time-bar determinations under §315(b) are ap-
pealable” notwithstanding §314(d). Wi-Fi One, LLC v.
Broadcom Corp., 878 F.3d 1364, 1367 (2018). The majority
opinion construed §314(d)’s reference to the determination
whether to institute inter partes review “under this section”
——————
2 The 2001 suit was brought by Inforocket.Com, Inc.—then the exclu-
sive licensee of the ’836 patent—against Keen, Inc. See Inforocket.Com,
Inc. v. Keen, Inc., No. 1:01–cv–05130 (SDNY). While the suit was pend-
ing, Keen acquired Inforocket and the District Court dismissed the suit
without prejudice. By the time of the inter partes review petition, Keen
had become Ingenio (now Thryv).
Cite as: 590 U. S. ____ (2020) 5
Opinion of the Court
as trained on the likelihood-of-success requirement stated
in §314(a). Id., at 1372. The §315(b) timeliness
determination, the majority concluded, “is not ‘closely
related’ to the institution decision addressed in §314(a).”
Id., at 1374 (quoting Cuozzo, 579 U. S., at ___ (slip op., at
12)). The majority therefore held that for §315(b) appeals,
§314(d) does not displace the usual presumption favoring
judicial review of agency action. Wi-Fi One, 878 F.3d, at
1374–1375. In a concurring opinion, Judge O’Malley
emphasized a “simpler” basis for the same conclusion. Id.,
at 1375. In her view, §314(d) shields from review only the
agency’s assessment of a petition’s “substantive adequacy,”
not questions about the agency’s “authority to act.” Id., at
1376.
Judge Hughes, joined by Judges Lourie, Bryson, and Dyk,
dissented, expressing a position that today’s dissent
characterizes as “extraordinary.” Post, at 6. Those judges
concluded that §314(d) conveys Congress’ “clear and
unmistakable” “intent to prohibit judicial review of the
Board’s [inter partes review] institution decision.” Wi-Fi
One, 878 F.3d, at 1378. That prohibition applies to §315(b)
issues, the Federal Circuit dissenters maintained, because
§315(b) “describes when an [inter partes review] may be
‘instituted.’ ” Id., at 1377, 1378–1379 (quoting §315(b)).
In light of its en banc decision in Wi-Fi One, the Court of
Appeals granted panel rehearing in this case. Treating the
Board’s application of §315(b) as judicially reviewable, the
panel’s revised opinion held that the Board erred by insti-
tuting review. The petition for inter partes review here was
untimely, the Court of Appeals held, because the 2001 in-
fringement complaint, though dismissed without prejudice,
started the one-year clock under §315(b).3 The court there-
fore vacated the Board’s final written decision, which had
——————
3 A footnote in the panel’s opinion noted that the Court of Appeals sit-
6 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion of the Court
invalidated 13 of Click-to-Call’s claims for want of the req-
uisite novelty and nonobviousness, and remanded with in-
structions to dismiss.
We granted certiorari to resolve the reviewability issue,
587 U. S. ___ (2019), and now vacate the Federal Circuit’s
judgment and remand with instructions to dismiss the ap-
peal for lack of appellate jurisdiction.
III
A
To determine whether §314(d) precludes judicial review
of the agency’s application of §315(b)’s time prescription, we
begin by defining §314(d)’s scope. Section 314(d)’s text ren-
ders “final and nonappealable” the “determination by the
Director whether to institute an inter partes review under
this section.” §314(d) (emphasis added). That language in-
dicates that a party generally cannot contend on appeal
that the agency should have refused “to institute an inter
partes review.”
We held as much in Cuozzo. There, a party contended on
appeal that the agency should have refused to institute in-
ter partes review because the petition failed §312(a)(3)’s re-
quirement that the grounds for challenging patent claims
must be identified “with particularity.” 579 U. S., at ___
(slip op., at 6) (internal quotation marks omitted). This
“contention that the Patent Office unlawfully initiated its
agency review is not appealable,” we held, for “that is what
§314(d) says.” Id., at ___ (slip op., at 7). Section 314(d), we
explained, “preclud[es] review of the Patent Office’s institu-
tion decisions” with sufficient clarity to overcome the
——————
ting en banc had considered and agreed with the panel majority’s conclu-
sion that a complaint voluntarily dismissed without prejudice can trigger
§315(b)’s time bar. Click-to-Call Technologies, LP v. Ingenio, Inc., 899
F.3d 1321, 1328, n. 3 (CA Fed. 2018). On that issue, Judge Taranto is-
sued a concurring opinion, id., at 1343–1347, and Judge Dyk, joined by
Judge Lourie, issued a dissenting opinion, id., at 1350–1355. That ques-
tion is outside the scope of our review.
Cite as: 590 U. S. ____ (2020) 7
Opinion of the Court
“ ‘strong presumption’ in favor of judicial review.” Id., at
___–___ (slip op., at 9–11) (quoting Mach Mining, LLC v.
EEOC, 575 U.S. 480, 486 (2015)). See Cuozzo, 579 U. S.,
at ___– ___ (slip op., at 9–11) (finding “ ‘clear and convincing’
indications . . . that Congress intended to bar review” (quot-
ing Block v. Community Nutrition Institute, 467 U.S. 340,
349–350 (1984))).
We reserved judgment in Cuozzo, however, on whether
§314(d) would bar appeals reaching well beyond the deci-
sion to institute inter partes review. 579 U. S., at ___ (slip
op., at 11). We declined to “decide the precise effect of
§314(d) on,” for example, “appeals that implicate constitu-
tional questions.” Ibid. Instead, we defined the bounds of
our holding this way: “[O]ur interpretation applies where
the grounds for attacking the decision to institute inter
partes review consist of questions that are closely tied to
the application and interpretation of statutes related to the
Patent Office’s decision to initiate inter partes review.”
Ibid.
B
We therefore ask whether a challenge based on §315(b)
ranks as an appeal of the agency’s decision “to institute an
inter partes review.” §314(d). We need not venture beyond
Cuozzo’s holding that §314(d) bars review at least of mat-
ters “closely tied to the application and interpretation of
statutes related to” the institution decision, 579 U. S., at
___ (slip op., at 11), for a §315(b) challenge easily meets that
measurement.
Section 315(b)’s time limitation is integral to, indeed a
condition on, institution. After all, §315(b) sets forth a cir-
cumstance in which “[a]n inter partes review may not be
instituted.” Even Click-to-Call and the Court of Appeals
recognize that §315(b) governs institution. See Brief for Re-
spondent Click-to-Call 1 (§315(b) is “a clear limit on the
Board’s institution authority”); Wi-Fi One, 878 F.3d, at
8 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion of the Court
1373 (“§315(b) controls the Director’s authority to institute
[inter partes review]”).
Because §315(b) expressly governs institution and noth-
ing more, a contention that a petition fails under §315(b) is
a contention that the agency should have refused “to insti-
tute an inter partes review.” §314(d). A challenge to a pe-
tition’s timeliness under §315(b) thus raises “an ordinary
dispute about the application of ” an institution-related
statute. Cuozzo, 579 U. S., at ___ (slip op., at 7). In this
case as in Cuozzo, therefore, §314(d) overcomes the pre-
sumption favoring judicial review.4
C
The AIA’s purpose and design strongly reinforce our con-
clusion. By providing for inter partes review, Congress,
concerned about overpatenting and its diminishment of
competition, sought to weed out bad patent claims effi-
ciently. See id., at ___ (slip op., at 8); H. R. Rep. No. 112–
98, pt. 1, p. 40 (2011) (“The legislation is designed to estab-
lish a more efficient and streamlined patent system that
will improve patent quality and limit unnecessary and
counterproductive litigation costs.”).5
——————
4 We do not decide whether mandamus would be available in an ex-
traordinary case. Cf. Cuozzo Speed Technologies, LLC v. Lee, 579 U. S.
___, ___–___, n. 5 (2016) (ALITO, J., concurring in part and dissenting in
part) (slip op., at 5–6, n. 5).
5 The dissent acknowledges that “Congress authorized inter partes re-
view to encourage further scrutiny of already issued patents.” Post, at
14. Yet the dissent, despite the Court’s decision upholding the constitu-
tionality of such review in Oil States Energy Services, LLC v. Greene’s
Energy Group, LLC, 584 U. S. ___ (2018), appears ultimately to urge that
Congress lacks authority to permit second looks. Patents are property,
the dissent several times repeats, and Congress has no prerogative to
allow “property-taking-by-bureaucracy.” Post, at 1, 18–21. But see Oil
States, 584 U. S., at ___ (slip op., at 7) (“patents are public franchises”
(internal quotation marks omitted)). The second look Congress put in
place is assigned to the very same bureaucracy that granted the patent
in the first place. Why should that bureaucracy be trusted to give an
Cite as: 590 U. S. ____ (2020) 9
Opinion of the Court
Allowing §315(b) appeals would tug against that objec-
tive, wasting the resources spent resolving patentability
and leaving bad patents enforceable. A successful §315(b)
appeal would terminate in vacatur of the agency’s decision;
in lieu of enabling judicial review of patentability, vacatur
would unwind the agency’s merits decision. See Cuozzo,
579 U. S., at ___ (slip op., at 8). And because a patent owner
would need to appeal on §315(b) untimeliness grounds only
if she could not prevail on patentability, §315(b) appeals
would operate to save bad patent claims. This case illus-
trates the dynamic. The agency held Click-to-Call’s patent
claims invalid, and Click-to-Call does not contest that hold-
ing. It resists only the agency’s institution decision, mind-
ful that if the institution decision is reversed, then the
agency’s work will be undone and the canceled patent
claims resurrected.
Other features of the statutory design confirm that Con-
gress prioritized patentability over §315(b)’s timeliness re-
quirement. A petitioner’s failure to satisfy §315(b) does not
prevent the agency from conducting inter partes review of
the challenged patent claims; the agency can do so at an-
other petitioner’s request. §311(a). Nor does failure to sat-
isfy §315(b) prevent the original initiator from participating
on the merits; the §315(b)-barred party can join a proceed-
ing initiated by another petitioner. §315(b), (c). And once
inter partes review is instituted, the agency may issue a fi-
nal written decision even “[i]f no petitioner remains in the
inter partes review.” §317(a). It is unsurprising that a stat-
utory scheme so consistently elevating resolution of patent-
ability above a petitioner’s compliance with §315(b) would
exclude §315(b) appeals, thereby preserving the Board’s ad-
judication of the merits.
——————
honest count on first view, but a jaundiced one on second look? See post,
at 19–20.
10 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion of the Court
Judicial review of §315(b) rulings, moreover, would do lit-
tle to serve other statutory goals. The purpose of §315(b),
all agree, is to minimize burdensome overlap between inter
partes review and patent-infringement litigation. Brief for
Petitioner 24; Brief for Federal Respondent 36; Brief for Re-
spondent Click-to-Call 37. Judicial review after the agency
proceedings cannot undo the burdens already occasioned.
Nor are §315(b) appeals necessary to protect patent claims
from wrongful invalidation, for patent owners remain free
to appeal final decisions on the merits. §319.
IV
Click-to-Call advances a narrower reading of §314(d). In
Click-to-Call’s view, which the dissent embraces, post, at 6–
18, the bar on judicial review applies only to the agency’s
threshold determination under §314(a) of the question
whether the petitioner has a reasonable likelihood of pre-
vailing. Section 314(d) addresses the “determination by the
Director whether to institute inter partes review under this
section” (emphasis added), and, Click-to-Call maintains,
§314(a) contains “the only substantive determination refer-
enced in” the same section as §314(d). Brief for Respondent
Click-to-Call 16. This interpretation, Click-to-Call argues,
supplies a clear rule consonant with the presumption favor-
ing judicial review. Cf. supra, at 4–5 (Federal Circuit’s en
banc Wi-Fi One decision).
Cuozzo is fatal to Click-to-Call’s interpretation. Section
314(d)’s review bar is not confined to the agency’s applica-
tion of §314(a), for in Cuozzo we held unreviewable the
agency’s application of §312(a)(3). 579 U. S., at ___–___
(slip op., at 7–8). Far from limiting the appeal bar to
§314(a) and “nothing else” as Click-to-Call urges, Brief for
Respondent 29, the Court’s opinion in Cuozzo explained
that the bar extends to challenges grounded in “statutes re-
lated to” the institution decision. 579 U. S., at ___ (slip op.,
at 11).
Cite as: 590 U. S. ____ (2020) 11
Opinion of the Court
The text of §314(d) offers Click-to-Call no support. The
provision sweeps more broadly than the determination
about whether “there is a reasonable likelihood that the pe-
titioner would prevail.” §314(a). Rather, it encompasses
the entire determination “whether to institute an inter
partes review.” §314(d).
And §314(d) refers not to a determination under subsec-
tion (a), but to the determination “under this section.” That
phrase indicates that §314 governs the Director’s institu-
tion of inter partes review. Titled “Institution of inter
partes review,” §314 is the section housing the command to
the Director to “determine whether to institute an inter
partes review,” §314(b). Thus, every decision to institute is
made “under” §314 but must take account of specifications
in other provisions—such as the §312(a)(3) particularity re-
quirement at issue in Cuozzo and the §315(b) timeliness re-
quirement at issue here. Similar clarifying language recurs
throughout the AIA. See, e.g., §315(c) (referring to the Di-
rector’s determination regarding “the institution of an inter
partes review under section 314” (emphasis added)); §314(b)
(referring to “a petition filed under section 311,” the section
authorizing the filing of petitions (emphasis added));
§314(b)(1) (referring to “a preliminary response to the peti-
tion under section 313,” the section authorizing the filing of
preliminary responses to petitions (emphasis added)).
If Congress had intended Click-to-Call’s meaning, it had
at hand readymade language from a precursor to §314(d):
“A determination by the Director under subsection (a) shall
be final and non-appealable.” 35 U.S. C. §312(c) (2006 ed.)
(emphasis added) (governing inter partes reexamination).
Or Congress might have borrowed from a related provision:
“A determination by the Director pursuant to subsection (a)
of this section that no substantial new question of patenta-
bility has been raised will be final and nonappealable.” 35
U.S. C. §303(c) (emphasis added) (governing ex parte reex-
12 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion of the Court
amination). Instead, Congress chose to shield from appel-
late review the determination “whether to institute an inter
partes review under this section.” §314(d) (emphasis
added). That departure in language suggests a departure
in meaning. See Henson v. Santander Consumer USA Inc.,
582 U. S. ___, ___ (2017) (slip op., at 6).
Click-to-Call doubts that Congress would have limited
the agency’s institution authority in §315(b) without ensur-
ing judicial supervision. Congress entrusted the institution
decision to the agency, however, to avoid the significant
costs, already recounted, of nullifying a thoroughgoing de-
termination about a patent’s validity. See supra, at 8–9.
That goal—preventing appeals that would frustrate effi-
cient resolution of patentability—extends beyond §314(a)
appeals.
Click-to-Call also contends that we adopted its interpre-
tation of §314(d) in SAS Institute Inc. v. Iancu, 584 U. S. ___
(2018). Neither of our holdings in that case assists Click-
to-Call, and both holdings remain governing law. SAS In-
stitute first held that once the agency institutes an inter
partes review, it must “resolve all of the claims in the case.”
Id., at ___ (slip op., at 1). SAS Institute located that rule in
§318(a), which requires the agency to decide “the patenta-
bility of any patent claim challenged by the petitioner.”
Ibid. (emphasis in original; internal quotation marks omit-
ted). SAS Institute next held that §314(d) did not bar judi-
cial review of §318(a)’s application. Id., at ___–___ (slip op.,
at 12–14). Our decision explained that “nothing in §314(d)
or Cuozzo withdraws our power to ensure that an inter
partes review proceeds in accordance with the law’s de-
mands.” Id., at ___ (slip op., at 14). That reviewability hold-
ing is inapplicable here, for Click-to-Call’s appeal chal-
lenges not the manner in which the agency’s review
“proceeds” once instituted, but whether the agency should
have instituted review at all.
Cite as: 590 U. S. ____ (2020) 13
Opinion of the Court
Click-to-Call homes in on a single sentence from SAS In-
stitute’s reviewability discussion: “Cuozzo concluded that
§314(d) precludes judicial review only of the Director’s ‘ini-
tial determination’ under §314(a) that ‘there is a “reason-
able likelihood” that the claims are unpatentable on the
grounds asserted’ and review is therefore justified.” Id., at
___ (slip op., at 13) (quoting Cuozzo, 579 U. S., at ___ (slip
op., at 9)). But that sentence’s account of Cuozzo is incom-
plete. Recall that Cuozzo itself applied §314(d)’s appeal bar
to a challenge on grounds other than §314(a). See supra, at
10. To understand how far beyond §314(a) the bar on judi-
cial review extends, we look to the statute and Cuozzo; for
the reasons stated above, they establish that §314(d) bars
challenges resting on §315(b).6
——————
6 Defending Click-to-Call’s interpretation, the dissent takes a view of
our precedent that neither Click-to-Call nor the Federal Circuit ad-
vances. See post, at 15–18. The dissent does not consider itself bound
by Cuozzo’s conclusion that §314(d) bars appeal of “questions that are
closely tied to the application and interpretation of statutes related to
the Patent Office’s decision to initiate inter partes review,” 579 U. S., at
___ (slip op., at 11). According to the dissent, that statement is dicta
later repudiated in SAS Institute Inc. v. Iancu, 584 U. S. ___ (2018).
But Cuozzo concerned an appeal resting on a “related statutory sec-
tion”: §312(a)(3). 579 U. S., at ___ (slip op., at 7). That §312(a)(3)
challenge was tied to institution, the Court explained, for two reasons:
first, because it “attack[ed] a ‘determination . . . whether to institute’
review,” id., at ___–___ (slip op., at 7–8); second, because the §312(a)(3)
challenge was related to invoking §314(a)’s condition on institution, id.,
at ___ (slip op., at 12). Cuozzo’s recognition that §314(d) can bar chal-
lenges rooted in provisions other than §314(a) was hardly “dicta,” post,
at 16—it was the Court’s holding. And SAS Institute purported to adhere
to Cuozzo, not to overrule it. 584 U. S., at ___–___ (slip op., at 13–14).
The Court in SAS Institute said, specifically, that it discerned “nothing
in . . . Cuozzo” inconsistent with its conclusion. Id., at ___ (slip op.,
at 14).
We do not so lightly treat our determinations as dicta and our decisions
as overruling others sub silentio. Nor can we countenance the dissent’s
dangerous insinuation that today’s decision is not “really” binding prec-
edent. Post, at 17–18 (“[W]ho can say?”); post, at 18 (“Litigants and lower
14 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion of the Court
V
Click-to-Call presses an alternative reason why the
Board’s ruling on its §315(b) objection is appealable. The
Board’s final written decision addressed the §315(b) issue,
so Click-to-Call argues that it may appeal under §319,
which authorizes appeal from the final written decision.
But even labeled as an appeal from the final written deci-
sion, Click-to-Call’s attempt to overturn the Board’s §315(b)
ruling is still barred by §314(d). Because §315(b)’s sole of-
fice is to govern institution, Click-to-Call’s contention re-
mains, essentially, that the agency should have refused to
institute inter partes review. As explained, §314(d) makes
that contention unreviewable.
* * *
For the reasons stated, we vacate the judgment of the
United States Court of Appeals for the Federal Circuit and
remand the case with instructions to dismiss for lack of ap-
pellate jurisdiction.
It is so ordered.
——————
courts alike will just have to wait and see.”). Lest any “confusion” re-
main, post, at 17, we reaffirm today our holding in Cuozzo: Section 314(d)
generally precludes appeals of the agency’s institution decision, includ-
ing, beyond genuine debate, appeals “consist[ing] of questions that are
closely tied to the application and interpretation of statutes related to”
the institution decision. 579 U. S., at ___, ___ (slip op., at 7, 11). The
appeal bar, we therefore reiterate, is not limited to the agency’s applica-
tion of §314(a).
Cite as: 590 U. S. ____ (2020) 15
Opinion
Appendix of the of
to opinion Court
the Court
APPENDIX OF KEY STATUTORY PROVISIONS
35 U.S. C. §314:
“Institution of inter partes review
“(a) THRESHOLD.—The Director may not authorize
an inter partes review to be instituted unless the Di-
rector determines that the information presented in
the petition filed under section 311 and any response
filed under section 313 shows that there is a reasonable
likelihood that the petitioner would prevail with re-
spect to at least 1 of the claims challenged in the peti-
tion.
“(b) TIMING.—The Director shall determine whether
to institute an inter partes review under this chapter
pursuant to a petition filed under section 311 within 3
months after—
“(1) receiving a preliminary response to the petition
under section 313; or
“(2) if no such preliminary response is filed, the last
date on which such response may be filed.
“(c) NOTICE.—The Director shall notify the petitioner
and patent owner, in writing, of the Director’s determi-
nation under subsection (a), and shall make such notice
available to the public as soon as is practicable. Such
notice shall include the date on which the review shall
commence.
“(d) NO APPEAL.—The determination by the Director
whether to institute an inter partes review under this
section shall be final and nonappealable.”
16 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP
Opinion
Appendix of the of
to opinion Court
the Court
35 U.S. C. §315(b):
“PATENT OWNER’S ACTION.—An inter partes review
may not be instituted if the petition requesting the pro-
ceeding is filed more than 1 year after the date on
which the petitioner, real party in interest, or privy of
the petitioner is served with a complaint alleging in-
fringement of the patent. The time limitation set forth
in the preceding sentence shall not apply to a request
for joinder under subsection (c).”
Cite as: 590 U. S. ____ (2020) 1
GORSUCH, J., dissenting
SUPREME COURT OF THE UNITED STATES
_________________
No. 18–916
_________________
THRYV, INC., FKA DEX MEDIA, INC., PETITIONER v.
CLICK-TO-CALL TECHNOLOGIES, LP, ET AL. | * Inter partes review is an administrative process in which a patent challenger may ask the U. S. Patent and Trade- mark Office (PTO) to reconsider the validity of earlier granted patent claims. This case concerns a statutorily pre- scribed limitation of the issues a party may raise on appeal from an inter partes review proceeding. When presented with a request for inter partes review, the agency must decide whether to institute review. 35 U.S. C. Among other conditions set by statute, if the request comes more than a year after suit against the re- questing party for patent infringement, “[a]n inter partes review may not be instituted.” “The determination by the [PTO] Director whether to institute an inter partes review under this section shall be final and nonappealable.” In this case, the agency instituted inter partes review in —————— *JUSTICE THOMAS and JUSTICE ALITO join all but Part III–C of this opinion. † Key statutory provisions are reproduced in an appendix to this opin- ion. 2 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion of the Court response to a petition from Thryv, Inc., resulting in the can- cellation of several patent claims. Patent owner Click-to- Call Technologies, LP, appealed, contending that Thryv’s petition was untimely under The question before us: Does bar on judicial re- view of the agency’s decision to institute inter partes review preclude Click-to-Call’s appeal? Our answer is yes. The agency’s application of time limit, we hold, is closely related to its decision whether to institute inter partes review and is therefore rendered nonappealable by I The Patent and Trademark Office has several ways “to reexamine—and perhaps cancel—a patent claim that it had previously allowed.” Cuozzo Speed Technologies, LLC v. Lee, 579 U. S. (2016) (slip op., at 3). Congress es- tablished the procedure at issue here, inter partes review, in the Leahy-Smith America Invents Act (AIA), 125 Stat. 284, enacted in 2011. See 35 U.S. C. et seq. Inter partes review allows third parties to challenge patent claims on grounds of invalidity specified by statute. (b). For inter partes review to proceed, the agency must agree to institute review. Any person who is not the pat- ent’s owner may file a petition requesting inter partes re- view. (a). The patent owner may oppose institution of inter partes review, asserting the petition’s “failure to meet any requirement of this chapter.” The AIA sets out prerequisites for institution. Among them, “[t]he Director may not authorize an inter partes re- view to be instituted unless the Director determines that there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims chal- lenged in the petition.” Most pertinent to this case, Cite as: 590 U. S. (2020) 3 Opinion of the Court “[a]n inter partes review may not be instituted if the peti- tion requesting the proceeding is filed more than 1 year af- ter the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.” After receiving the petition and any response, the PTO “Director shall determine whether to institute an inter partes review under this chapter.” The Director has delegated institution authority to the Patent Trial and Appeal Board (Board). (a) (2019). As just noted, the federal agency’s “determination whether to institute an inter partes review under this section” is “final and nonappealable.” 35 U.S. C. Upon electing to institute inter partes review, the Board conducts a proceeding to evaluate the challenged claims’ va- lidity. See At the conclusion of the proceeding—if review “is instituted and not dismissed”—the Board “is- sue[s] a final written decision with respect to the patenta- bility of ” the challenged claims. “A party dissatis- fied with the final written decision may appeal the decision” to the Court of Appeals for the Federal Circuit. II Respondent Click-to-Call owns a patent relating to a technology for anonymous telephone calls, U. S. Patent No. 5,818,836 (’836 patent). In 2013, petitioner Thryv sought inter partes review, challenging several of the patent’s claims.1 In opposition, Click-to-Call urged that barred in- stitution of inter partes review because Thryv filed its peti- tion too late. Click-to-Call pointed to an infringement suit —————— 1 More precisely, the petition was filed by four companies, including YellowPages.com, LLC, and Ingenio, LLC. Through “a series of mergers, sales, and name changes,” both became Thryv. Brief for Petitioner 8. For simplicity, we refer to Thryv and its predecessor entities as “Thryv.” 4 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion of the Court filed in 2001, which ended in a voluntary dismissal without prejudice.2 In Click-to-Call’s view, that 2001 suit started one-year clock, making the 2013 petition untimely. The Board disagreed. Section 315(b) did not bar the in- stitution of inter partes review, the Board concluded, be- cause a complaint dismissed without prejudice does not trigger one-year limit. Finding no other barrier to institution, the Board decided to institute review. After proceedings on the merits, the Board issued a final written decision reiterating its rejection of Click-to-Call’s argument and canceling 13 of the patent’s claims as obvious or lacking novelty. Click-to-Call appealed, challenging only the Board’s de- termination that did not preclude inter partes re- view. The Court of Appeals dismissed the appeal for lack of jurisdiction, agreeing with Thryv and the Director (who in- tervened on appeal) that bar on appeal of the in- stitution decision precludes judicial review of the agency’s application of Citing our intervening decision in Cuozzo, see infra, at 6–7, we granted certiorari, vacated the judgment, and remanded. Click-to-Call Technologies, LP v. Oracle Corp., 579 U. S. (2016). On remand, the Court of Appeals again dismissed the appeal on the same ground. Thereafter, in another case, the en banc Federal Circuit held that “time-bar determinations under are ap- pealable” notwithstanding Wi-Fi LLC v. Broadcom Corp., The majority opinion construed reference to the determination whether to institute inter partes review “under this section” —————— 2 The 2001 suit was brought by Inforocket.Com, Inc.—then the exclu- sive licensee of the ’836 patent—against Keen, Inc. See Inforocket.Com, Inc. v. Keen, Inc., No. 1:01–cv–05130 (SDNY). While the suit was pend- ing, Keen acquired Inforocket and the District Court dismissed the suit without prejudice. By the time of the inter partes review petition, Keen had become Ingenio (now Thryv). Cite as: 590 U. S. (2020) 5 Opinion of the Court as trained on the likelihood-of-success requirement stated in The timeliness determination, the majority concluded, “is not ‘closely related’ to the institution decision addressed in ” (quoting Cuozzo, 579 U. S., at (slip op., at 12)). The majority therefore held that for appeals, does not displace the usual presumption favoring judicial review of agency action. Wi-Fi 878 F.3d, at 1374–1375. In a concurring opinion, Judge O’Malley emphasized a “simpler” basis for the same conclusion. at 1375. In her view, shields from review only the agency’s assessment of a petition’s “substantive adequacy,” not questions about the agency’s “authority to act.” at 1376. Judge Hughes, joined by Judges Lourie, Bryson, and Dyk, dissented, expressing a position that today’s dissent characterizes as “extraordinary.” Post, at 6. Those judges concluded that conveys Congress’ “clear and unmistakable” “intent to prohibit judicial review of the Board’s [inter partes review] institution decision.” Wi-Fi That prohibition applies to issues, the Federal Circuit dissenters maintained, because “describes when an [inter partes review] may be ‘instituted.’ ” 1378–1379 (quoting ). In light of its en banc decision in Wi-Fi the Court of Appeals granted panel rehearing in this case. Treating the Board’s application of as judicially reviewable, the panel’s revised opinion held that the Board erred by insti- tuting review. The petition for inter partes review here was untimely, the Court of Appeals held, because the 2001 in- fringement complaint, though dismissed without prejudice, started the one-year clock under 3 The court there- fore vacated the Board’s final written decision, which had —————— 3 A footnote in the panel’s opinion noted that the Court of Appeals sit- 6 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion of the Court invalidated 13 of Click-to-Call’s claims for want of the req- uisite novelty and nonobviousness, and remanded with in- structions to dismiss. We granted certiorari to resolve the reviewability issue, 587 U. S. (2019), and now vacate the Federal Circuit’s judgment and remand with instructions to dismiss the ap- peal for lack of appellate jurisdiction. III A To determine whether precludes judicial review of the agency’s application of time prescription, we begin by defining scope. Section 314(d)’s text ren- ders “final and nonappealable” the “determination by the Director whether to institute an inter partes review under this section.” (emphasis added). That language in- dicates that a party generally cannot contend on appeal that the agency should have refused “to institute an inter partes review.” We held as much in Cuozzo. There, a party contended on appeal that the agency should have refused to institute in- ter partes review because the petition failed re- quirement that the grounds for challenging patent claims must be identified “with particularity.” 579 U. S., at (slip op., at 6) (internal quotation marks omitted). This “contention that the Patent Office unlawfully initiated its agency review is not appealable,” we held, for “that is what says.” at (slip op., at 7). Section 314(d), we explained, “preclud[es] review of the Patent Office’s institu- tion decisions” with sufficient clarity to overcome the —————— ting en banc had considered and agreed with the panel majority’s conclu- sion that a complaint voluntarily dismissed without prejudice can trigger time bar. Click-to-Call Technologies, LP v. Ingenio, Inc., 899 F.3d 1321, 1328, n. 3 On that issue, Judge Taranto is- sued a concurring opinion, at 1343–1347, and Judge Dyk, joined by Judge Lourie, issued a dissenting opinion, at 1350–1355. That ques- tion is outside the scope of our review. Cite as: 590 U. S. (2020) 7 Opinion of the Court “ ‘strong presumption’ in favor of judicial review.” at – (slip op., at 9–11) ). See Cuozzo, 579 U. S., at – (slip op., at 9–11) (finding “ ‘clear and convincing’ indications that Congress intended to bar review” (quot- ing 349–350 (1984))). We reserved judgment in Cuozzo, however, on whether would bar appeals reaching well beyond the deci- sion to institute inter partes review. 579 U. S., at (slip op., at 11). We declined to “decide the precise effect of on,” for example, “appeals that implicate constitu- tional questions.” Instead, we defined the bounds of our holding this way: “[O]ur interpretation applies where the grounds for attacking the decision to institute inter partes review consist of questions that are closely tied to the application and interpretation of statutes related to the Patent Office’s decision to initiate inter partes review.” B We therefore ask whether a challenge based on ranks as an appeal of the agency’s decision “to institute an inter partes review.” We need not venture beyond Cuozzo’s holding that bars review at least of mat- ters “closely tied to the application and interpretation of statutes related to” the institution decision, 579 U. S., at (slip op., at 11), for a challenge easily meets that measurement. Section 315(b)’s time limitation is integral to, indeed a condition on, institution. After all, sets forth a cir- cumstance in which “[a]n inter partes review may not be instituted.” Even Click-to-Call and the Court of Appeals recognize that governs institution. See Brief for Re- spondent Click-to-Call 1 ( is “a clear limit on the Board’s institution authority”); Wi-Fi 878 F.3d, at 8 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion of the Court 1373 (“ controls the Director’s authority to institute [inter partes review]”). Because expressly governs institution and noth- ing more, a contention that a petition fails under is a contention that the agency should have refused “to insti- tute an inter partes review.” A challenge to a pe- tition’s timeliness under thus raises “an ordinary dispute about the application of ” an institution-related statute. Cuozzo, 579 U. S., at (slip op., at 7). In this case as in Cuozzo, therefore, overcomes the pre- sumption favoring judicial review.4 C The AIA’s purpose and design strongly reinforce our con- clusion. By providing for inter partes review, Congress, concerned about overpatenting and its diminishment of competition, sought to weed out bad patent claims effi- ciently. See at (slip op., at 8); H. R. Rep. No. 112– 98, pt. 1, p. 40 (2011) (“The legislation is designed to estab- lish a more efficient and streamlined patent system that will improve patent quality and limit unnecessary and counterproductive litigation costs.”).5 —————— 4 We do not decide whether mandamus would be available in an ex- traordinary case. Cuozzo Speed Technologies, LLC v. Lee, 579 U. S. –, n. 5 (2016) (ALITO, J., concurring in part and dissenting in part) (slip op., at 5–6, n. 5). 5 The dissent acknowledges that “Congress authorized inter partes re- view to encourage further scrutiny of already issued patents.” Post, at 14. Yet the dissent, despite the Court’s decision upholding the constitu- tionality of such review in Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, 584 U. S. appears ultimately to urge that Congress lacks authority to permit second looks. Patents are property, the dissent several times repeats, and Congress has no prerogative to allow “property-taking-by-bureaucracy.” Post, at 1, 18–21. But see Oil States, 584 U. S., at (slip op., at 7) (“patents are public franchises” (internal quotation marks omitted)). The second look Congress put in place is assigned to the very same bureaucracy that granted the patent in the first place. Why should that bureaucracy be trusted to give an Cite as: 590 U. S. (2020) 9 Opinion of the Court Allowing appeals would tug against that objec- tive, wasting the resources spent resolving patentability and leaving bad patents enforceable. A successful appeal would terminate in vacatur of the agency’s decision; in lieu of enabling judicial review of patentability, vacatur would unwind the agency’s merits decision. See Cuozzo, 579 U. S., at (slip op., at 8). And because a patent owner would need to appeal on untimeliness grounds only if she could not prevail on patentability, appeals would operate to save bad patent claims. This case illus- trates the dynamic. The agency held Click-to-Call’s patent claims invalid, and Click-to-Call does not contest that hold- ing. It resists only the agency’s institution decision, mind- ful that if the institution decision is reversed, then the agency’s work will be undone and the canceled patent claims resurrected. Other features of the statutory design confirm that Con- gress prioritized patentability over timeliness re- quirement. A petitioner’s failure to satisfy does not prevent the agency from conducting inter partes review of the challenged patent claims; the agency can do so at an- other petitioner’s request. (a). Nor does failure to sat- isfy prevent the original initiator from participating on the merits; the -barred party can join a proceed- ing initiated by another petitioner. (c). And once inter partes review is instituted, the agency may issue a fi- nal written decision even “[i]f no petitioner remains in the inter partes review.” It is unsurprising that a stat- utory scheme so consistently elevating resolution of patent- ability above a petitioner’s compliance with would exclude appeals, thereby preserving the Board’s ad- judication of the merits. —————— honest count on first view, but a jaundiced one on second look? See post, at 19–20. 10 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion of the Court Judicial review of rulings, moreover, would do lit- tle to serve other statutory goals. The purpose of all agree, is to minimize burdensome overlap between inter partes review and patent-infringement litigation. Brief for Petitioner 24; Brief for Federal Respondent 36; Brief for Re- spondent Click-to-Call 37. Judicial review after the agency proceedings cannot undo the burdens already occasioned. Nor are appeals necessary to protect patent claims from wrongful invalidation, for patent owners remain free to appeal final decisions on the merits. IV Click-to-Call advances a narrower reading of In Click-to-Call’s view, which the dissent embraces, post, at 6– 18, the bar on judicial review applies only to the agency’s threshold determination under of the question whether the petitioner has a reasonable likelihood of pre- vailing. Section 314(d) addresses the “determination by the Director whether to institute inter partes review under this section” (emphasis added), and, Click-to-Call maintains, contains “the only substantive determination refer- enced in” the same section as Brief for Respondent Click-to-Call 16. This interpretation, Click-to-Call argues, supplies a clear rule consonant with the presumption favor- ing judicial review. at 4–5 (Federal Circuit’s en banc Wi-Fi decision). Cuozzo is fatal to Click-to-Call’s interpretation. Section 314(d)’s review bar is not confined to the agency’s applica- tion of for in Cuozzo we held unreviewable the agency’s application of 579 U. S., at – (slip op., at 7–8). Far from limiting the appeal bar to and “nothing else” as Click-to-Call urges, Brief for Respondent 29, the Court’s opinion in Cuozzo explained that the bar extends to challenges grounded in “statutes re- lated to” the institution decision. 579 U. S., at (slip op., at 11). Cite as: 590 U. S. (2020) 11 Opinion of the Court The text of offers Click-to-Call no support. The provision sweeps more broadly than the determination about whether “there is a reasonable likelihood that the pe- titioner would prevail.” Rather, it encompasses the entire determination “whether to institute an inter partes review.” And refers not to a determination under subsec- tion (a), but to the determination “under this section.” That phrase indicates that governs the Director’s institu- tion of inter partes review. Titled “Institution of inter partes review,” is the section housing the command to the Director to “determine whether to institute an inter partes review,” Thus, every decision to institute is made “under” but must take account of specifications in other provisions—such as the particularity re- quirement at issue in Cuozzo and the timeliness re- quirement at issue here. Similar clarifying language recurs throughout the AIA. See, e.g., (referring to the Di- rector’s determination regarding “the institution of an inter partes review under section 314” (emphasis added)); (b) (referring to “a petition filed under section 311,” the section authorizing the filing of petitions (emphasis added)); (b)(1) (referring to “a preliminary response to the peti- tion under section 313,” the section authorizing the filing of preliminary responses to petitions (emphasis added)). If Congress had intended Click-to-Call’s meaning, it had at hand readymade language from a precursor to : “A determination by the Director under subsection (a) shall be final and non-appealable.” 35 U.S. C. (2006 ed.) (emphasis added) (governing inter partes reexamination). Or Congress might have borrowed from a related provision: “A determination by the Director pursuant to subsection (a) of this section that no substantial new question of patenta- bility has been raised will be final and nonappealable.” 35 U.S. C. (emphasis added) (governing ex parte reex- 12 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion of the Court amination). Instead, Congress chose to shield from appel- late review the determination “whether to institute an inter partes review under this section.” (emphasis added). That departure in language suggests a departure in meaning. See Henson v. Santander Consumer USA Inc., 582 U. S. (2017) (slip op., at 6). Click-to-Call doubts that Congress would have limited the agency’s institution authority in without ensur- ing judicial supervision. Congress entrusted the institution decision to the agency, however, to avoid the significant costs, already recounted, of nullifying a thoroughgoing de- termination about a patent’s validity. See at 8–9. That goal—preventing appeals that would frustrate effi- cient resolution of patentability—extends beyond appeals. Click-to-Call also contends that we adopted its interpre- tation of in SAS Institute Inc. v. Iancu, 584 U. S. Neither of our holdings in that case assists Click- to-Call, and both holdings remain governing law. SAS In- stitute first held that once the agency institutes an inter partes review, it must “resolve all of the claims in the case.” at (slip op., at 1). SAS Institute located that rule in which requires the agency to decide “the patenta- bility of any patent claim challenged by the petitioner.” (emphasis in original; internal quotation marks omit- ted). SAS Institute next held that did not bar judi- cial review of application. at – (slip op., at 12–14). Our decision explained that “nothing in or Cuozzo withdraws our power to ensure that an inter partes review proceeds in accordance with the law’s de- mands.” at (slip op., at 14). That reviewability hold- ing is inapplicable here, for Click-to-Call’s appeal chal- lenges not the manner in which the agency’s review “proceeds” once instituted, but whether the agency should have instituted review at all. Cite as: 590 U. S. (2020) 13 Opinion of the Court Click-to-Call homes in on a single sentence from SAS In- stitute’s reviewability discussion: “Cuozzo concluded that precludes judicial review only of the Director’s ‘ini- tial determination’ under that ‘there is a “reason- able likelihood” that the claims are unpatentable on the grounds asserted’ and review is therefore justified.” at (slip op., at 13) (quoting Cuozzo, 579 U. S., at (slip op., at 9)). But that sentence’s account of Cuozzo is incom- plete. Recall that Cuozzo itself applied appeal bar to a challenge on grounds other than See at 10. To understand how far beyond the bar on judi- cial review extends, we look to the statute and Cuozzo; for the reasons stated above, they establish that bars challenges resting on 6 —————— 6 Defending Click-to-Call’s interpretation, the dissent takes a view of our precedent that neither Click-to-Call nor the Federal Circuit ad- vances. See post, at 15–18. The dissent does not consider itself bound by Cuozzo’s conclusion that bars appeal of “questions that are closely tied to the application and interpretation of statutes related to the Patent Office’s decision to initiate inter partes review,” 579 U. S., at (slip op., at 11). According to the dissent, that statement is dicta later repudiated in SAS Institute Inc. v. Iancu, 584 U. S. But Cuozzo concerned an appeal resting on a “related statutory sec- tion”: 579 U. S., at (slip op., at 7). That challenge was tied to institution, the Court explained, for two reasons: first, because it “attack[ed] a ‘determination whether to institute’ review,” at – (slip op., at 7–8); second, because the challenge was related to invoking ’s condition on institution, at (slip op., at 12). Cuozzo’s recognition that can bar chal- lenges rooted in provisions other than was hardly “dicta,” post, at 16—it was the Court’s holding. And SAS Institute purported to adhere to Cuozzo, not to overrule it. 584 U. S., at – (slip op., at 13–14). The Court in SAS Institute said, specifically, that it discerned “nothing in Cuozzo” inconsistent with its conclusion. at (slip op., at 14). We do not so lightly treat our determinations as dicta and our decisions as overruling others sub silentio. Nor can we countenance the dissent’s dangerous insinuation that today’s decision is not “really” binding prec- edent. Post, at 17–18 (“[W]ho can say?”); post, at 18 (“Litigants and lower 14 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion of the Court V Click-to-Call presses an alternative reason why the Board’s ruling on its objection is appealable. The Board’s final written decision addressed the issue, so Click-to-Call argues that it may appeal under which authorizes appeal from the final written decision. But even labeled as an appeal from the final written deci- sion, Click-to-Call’s attempt to overturn the Board’s ruling is still barred by Because sole of- fice is to govern institution, Click-to-Call’s contention re- mains, essentially, that the agency should have refused to institute inter partes review. As explained, makes that contention unreviewable. * * * For the reasons stated, we vacate the judgment of the United States Court of Appeals for the Federal Circuit and remand the case with instructions to dismiss for lack of ap- pellate jurisdiction. It is so ordered. —————— courts alike will just have to wait and see.”). Lest any “confusion” re- main, post, at 17, we reaffirm today our holding in Cuozzo: Section 314(d) generally precludes appeals of the agency’s institution decision, includ- ing, beyond genuine debate, appeals “consist[ing] of questions that are closely tied to the application and interpretation of statutes related to” the institution decision. 579 U. S., at (slip op., at 7, 11). The appeal bar, we therefore reiterate, is not limited to the agency’s applica- tion of Cite as: 590 U. S. (2020) 15 Opinion Appendix of the of to opinion Court the Court APPENDIX OF KEY STATUTORY PROVISIONS 35 U.S. C. : “Institution of inter partes review “(a) THRESHOLD.—The Director may not authorize an inter partes review to be instituted unless the Di- rector determines that the information presented in the petition filed under section 311 and any response filed under section 313 shows that there is a reasonable likelihood that the petitioner would prevail with re- spect to at least 1 of the claims challenged in the peti- tion. “(b) TIMING.—The Director shall determine whether to institute an inter partes review under this chapter pursuant to a petition filed under section 311 within 3 months after— “(1) receiving a preliminary response to the petition under section 313; or “(2) if no such preliminary response is filed, the last date on which such response may be filed. “(c) NOTICE.—The Director shall notify the petitioner and patent owner, in writing, of the Director’s determi- nation under subsection (a), and shall make such notice available to the public as soon as is practicable. Such notice shall include the date on which the review shall commence. “(d) NO APPEAL.—The determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable.” 16 THRYV, INC. v. CLICK-TO-CALL TECHNOLOGIES, LP Opinion Appendix of the of to opinion Court the Court 35 U.S. C. : “PATENT OWNER’S ACTION.—An inter partes review may not be instituted if the petition requesting the pro- ceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging in- fringement of the patent. The time limitation set forth in the preceding sentence shall not apply to a request for joinder under subsection (c).” Cite as: 590 U. S. (2020) 1 GORSUCH, J., dissenting SUPREME COURT OF THE UNITED STATES No. 18–916 THRYV, INC., FKA DEX MEDIA, INC., PETITIONER v. CLICK-TO-CALL TECHNOLOGIES, LP, ET AL. |
Justice Brennan | majority | false | Tate v. Short | 1971-03-02T00:00:00 | null | https://www.courtlistener.com/opinion/108282/tate-v-short/ | https://www.courtlistener.com/api/rest/v3/clusters/108282/ | 1,971 | 1970-054 | 2 | 9 | 0 | Petitioner accumulated fines of $425 on nine convictions in the Corporation Court of Houston, Texas, for traffic offenses. He was unable to pay the fines because of indigency[1] and the Corporation Court, which otherwise has no jurisdiction to impose prison sentences,[2] committed him to the municipal prison farm according to the provisions of a state statute and municipal ordinance[3] which required that he remain there a sufficient *397 time to satisfy the fines at the rate of five dollars for each day; this required that he serve 85 days at the prison farm. After 21 days in custody, petitioner was released on bond when he applied to the County Criminal Court of Harris County for a writ of habeas corpus. He alleged that: "Because I am too poor, I am, therefore, unable to pay the accumulated fine of $425." The county court held that "legal cause has been shown for the imprisonment," and denied the application. The Court of Criminal Appeals of Texas affirmed, stating: "We overrule appellant's contention that because he is too poor to pay the fines his imprisonment is unconstitutional." 445 S.W.2d 210 (1969). We granted certiorari, 399 U.S. 925 (1970). We reverse on the authority of our decision in Williams v. Illinois, 399 U.S. 235 (1970).
The Illinois statute involved in Williams authorized both a fine and imprisonment. Williams was given the maximum sentence for petty theft of one year's imprisonment and a $500 fine, plus $5 in court costs. The judgment, as permitted by the Illinois statute, provided that if, when the one-year sentence expired, Williams did not pay the fine and court costs, he was to remain in jail a sufficient length of time to satisfy the total amount at the rate of $5 per day. We held that the Illinois statute as applied to Williams worked an invidious discrimination solely because he was too poor to pay the fine, and therefore violated the Equal Protection Clause.
Although the instant case involves offenses punishable by fines only, petitioner's imprisonment for nonpayment *398 constitutes precisely the same unconstitutional discrimination since, like Williams, petitioner was subjected to imprisonment solely because of his indigency.[4] In Morris v. Schoonfield, 399 U.S. 508, 509 (1970), four members of the Court anticipated the problem of this case and stated the view, which we now adopt, that
"the same constitutional defect condemned in Williams also inheres in jailing an indigent for failing to make immediate payment of any fine, whether or not the fine is accompanied by a jail term and whether or not the jail term of the indigent extends beyond the maximum term that may be imposed on a person willing and able to pay a fine. In each case, the Constitution prohibits the State from imposing a fine as a sentence and then automatically converting it into a jail term solely because the defendant is indigent and cannot forthwith pay the fine in full."
Our opinion in Williams stated the premise of this conclusion in saying that "the Equal Protection Clause of the Fourteenth Amendment requires that the statutory *399 ceiling placed on imprisonment for any substantive offense be the same for all defendants irrespective of their economic status." 399 U.S., at 244. Since Texas has legislated a "fines only" policy for traffic offenses, that statutory ceiling cannot, consistently with the Equal Protection Clause, limit the punishment to payment of the fine if one is able to pay it, yet convert the fine into a prison term for an indigent defendant without the means to pay his fine. Imprisonment in such a case is not imposed to further any penal objective of the State. It is imposed to augment the State's revenues but obviously does not serve that purpose; the defendant cannot pay because he is indigent and his imprisonment, rather than aiding collection of the revenue, saddles the State with the cost of feeding and housing him for the period of his imprisonment.
There are, however, other alternatives to which the State may constitutionally resort to serve its concededly valid interest in enforcing payment of fines. We repeat our observation in Williams in that regard, 399 U.S., at 244-245 (footnotes omitted):
"The State is not powerless to enforce judgments against those financially unable to pay a fine; indeed, a different result would amount to inverse discrimination since it would enable an indigent to avoid both the fine and imprisonment for nonpayment whereas other defendants must always suffer one or the other conviction.
"It is unnecessary for us to canvass the numerous alternatives to which the State by legislative enactment or judges within the scope of their authority may resort in order to avoid imprisoning an indigent beyond the statutory maximum for involuntary nonpayment of a fine or court costs. Appellant has suggested several plans, some of which are *400 already utilized in some States, while others resemble those proposed by various studies. The State is free to choose from among the variety of solutions already proposed and, of course, it may devise new ones."[5]
We emphasize that our holding today does not suggest any constitutional infirmity in imprisonment of a defendant with the means to pay a fine who refuses or neglects to do so. Nor is our decision to be understood *401 as precluding imprisonment as an enforcement method when alternative means are unsuccessful despite the defendant's reasonable efforts to satisfy the fines by those means; the determination of the constitutionality of imprisonment in that circumstance must await the presentation of a concrete case.
The judgment of the Court of Criminal Appeals of Texas is reversed and the case is remanded for further proceedings not inconsistent with this opinion.
It is so ordered.
MR. JUSTICE BLACK concurs in the result.
MR. JUSTICE HARLAN concurs in the judgment of the Court on the basis of the considerations set forth in his opinion concurring in the result in Williams v. Illinois, 399 U.S. 235, 259 (1970).
MR. | Petitioner accumulated fines of $425 on nine convictions in the Corporation Court of Houston, Texas, for traffic offenses. He was unable to pay the fines because of indigency[1] and the Corporation Court, which otherwise has no jurisdiction to impose prison sentences,[2] committed him to the municipal prison farm according to the provisions of a state statute and municipal ordinance[3] which required that he remain there a sufficient *397 time to satisfy the fines at the rate of five dollars for each day; this required that he serve 85 days at the prison farm. After 21 days in custody, petitioner was released on bond when he applied to the County Criminal Court of Harris County for a writ of habeas corpus. He alleged that: "Because I am too poor, I am, therefore, unable to pay the accumulated fine of $425." The county court held that "legal cause has been shown for the imprisonment," and denied the application. The Court of Criminal Appeals of Texas affirmed, stating: "We overrule appellant's contention that because he is too poor to pay the fines his imprisonment is unconstitutional." We granted certiorari, We reverse on the authority of our decision in The Illinois statute involved in Williams authorized both a fine and imprisonment. Williams was given the maximum sentence for petty theft of one year's imprisonment and a $500 fine, plus $5 in court costs. The judgment, as permitted by the Illinois statute, provided that if, when the one-year sentence expired, Williams did not pay the fine and court costs, he was to remain in jail a sufficient length of time to satisfy the total amount at the rate of $5 per day. We held that the Illinois statute as applied to Williams worked an invidious discrimination solely because he was too poor to pay the fine, and therefore violated the Equal Protection Clause. Although the instant case involves offenses punishable by fines only, petitioner's imprisonment for nonpayment *398 constitutes precisely the same unconstitutional discrimination since, like Williams, petitioner was subjected to imprisonment solely because of his indigency.[4] In four members of the Court anticipated the problem of this case and stated the view, which we now adopt, that "the same constitutional defect condemned in Williams also inheres in jailing an indigent for failing to make immediate payment of any fine, whether or not the fine is accompanied by a jail term and whether or not the jail term of the indigent extends beyond the maximum term that may be imposed on a person willing and able to pay a fine. In each case, the Constitution prohibits the State from imposing a fine as a sentence and then automatically converting it into a jail term solely because the defendant is indigent and cannot forthwith pay the fine in full." Our opinion in Williams stated the premise of this conclusion in saying that "the Equal Protection Clause of the Fourteenth Amendment requires that the statutory *399 ceiling placed on imprisonment for any substantive offense be the same for all defendants irrespective of their economic status." Since Texas has legislated a "fines only" policy for traffic offenses, that statutory ceiling cannot, consistently with the Equal Protection Clause, limit the punishment to payment of the fine if one is able to pay it, yet convert the fine into a prison term for an indigent defendant without the means to pay his fine. Imprisonment in such a case is not imposed to further any penal objective of the State. It is imposed to augment the State's revenues but obviously does not serve that purpose; the defendant cannot pay because he is indigent and his imprisonment, rather than aiding collection of the revenue, saddles the State with the cost of feeding and housing him for the period of his imprisonment. There are, however, other alternatives to which the State may constitutionally resort to serve its concededly valid interest in enforcing payment of fines. We repeat our observation in Williams in that -245 : "The State is not powerless to enforce judgments against those financially unable to pay a fine; indeed, a different result would amount to inverse discrimination since it would enable an indigent to avoid both the fine and imprisonment for nonpayment whereas other defendants must always suffer one or the other conviction. "It is unnecessary for us to canvass the numerous alternatives to which the State by legislative enactment or judges within the scope of their authority may resort in order to avoid imprisoning an indigent beyond the statutory maximum for involuntary nonpayment of a fine or court costs. Appellant has suggested several plans, some of which are *400 already utilized in some States, while others resemble those proposed by various studies. The State is free to choose from among the variety of solutions already proposed and, of course, it may devise new ones."[5] We emphasize that our holding today does not suggest any constitutional infirmity in imprisonment of a defendant with the means to pay a fine who refuses or neglects to do so. Nor is our decision to be understood *401 as precluding imprisonment as an enforcement method when alternative means are unsuccessful despite the defendant's reasonable efforts to satisfy the fines by those means; the determination of the constitutionality of imprisonment in that circumstance must await the presentation of a concrete case. The judgment of the Court of Criminal Appeals of Texas is reversed and the case is remanded for further proceedings not inconsistent with this opinion. It is so ordered. MR. JUSTICE BLACK concurs in the result. MR. JUSTICE HARLAN concurs in the judgment of the Court on the basis of the considerations set forth in his opinion concurring in the result in MR. |
Justice Stevens | dissenting | false | Gonzaga Univ. v. Doe | 2002-06-20T00:00:00 | null | https://www.courtlistener.com/opinion/121157/gonzaga-univ-v-doe/ | https://www.courtlistener.com/api/rest/v3/clusters/121157/ | 2,002 | 2001-069 | 1 | 7 | 2 | The Court's ratio decidendi in this case has a "now you see it, now you don't" character. At times, the Court seems to hold that the Family Educational Rights and Privacy Act of 1974 (FERPA or Act), 20 U.S. C. § 1232g, simply does not create any federal rights, thereby disposing of the case with a negative answer to the question "whether Congress intended to create a federal right, " ante, at 283. This interpretation would explain the Court's studious avoidance of the rights-creating language in the title and the text of the Act. Alternatively, its opinion may be read as accepting the proposition that FERPA does indeed create both parental rights of access to student records and student rights of privacy in such records, but that those federal rights are of a lesser value because Congress did not intend them to be enforceable by their owners. See, e. g., ante, at 290 (requiring of respondent "no less and no more" than what is required of plaintiffs attempting to prove that a statute creates an implied right of action). I shall first explain why the statute does, indeed, create federal rights, and then explain why the Court's novel attempt to craft a new category of second-class statutory rights is misguided.
I
Title 20 U.S. C. § 1232g, which embodies FERPA in its entirety, includes 10 subsections, which create rights for both students and their parents, and describe the procedures for enforcing and protecting those rights. Subsection (a)(1)(A) accords parents "the right to inspect and review the education records of their children."[1] Subsection (a)(1)(D) provides *294 that a "student or a person applying for admission" may waive "his right of access" to certain confidential statements. Two separate provisions protect students' privacy rights: subsection (a)(2) refers to "the privacy rights of students," and subsection (c) protects "the rights of privacy of students and their families." And subsection (d) provides that after a student has attained the age of 18, "the rights accorded to the parents of the student" shall thereafter be extended to the student. Given such explicit rights-creating language, the title of the statute, which describes "family educational rights," is appropriate: The entire statutory scheme was designed to protect such rights.
Of course, as we have stated previously, a "blanket approach" to determining whether a statute creates rights enforceable under 42 U.S. C. § 1983 (1994 ed., Supp. V) is inappropriate. Blessing v. Freestone, 520 U.S. 329, 344 (1997). The precise statutory provision at issue in this case is § 1232g(b).[2] Although the rights-creating language in this subsection is not as explicit as it is in other parts of the statute, it is clear that, in substance, § 1232g(b) formulates an individual right: in respondent's words, the "right of parents to withhold consent and prevent the unauthorized release of education record information by an educational *295 institution . . . that has a policy or practice of releasing such information." Brief for Respondent 11. This provision plainly meets the standards we articulated in Blessing for establishing a federal right: It is directed to the benefit of individual students and parents; the provision is binding on States, as it is "couched in mandatory, rather than precatory, terms"; and the right is far from "`vague and amorphous,' " 520 U.S., at 340-341. Indeed, the right at issue is more specific and clear than rights previously found enforceable under § 1983 in Wright v. Roanoke Redevelopment and Housing Authority, 479 U.S. 418 (1987), and Wilder v. Virginia Hospital Assn., 496 U.S. 498 (1990), both of which involved plaintiffs' entitlement to "reasonable" amounts of money.[3] As such, the federal right created by § 1232g(b) is "presumptively enforceable by § 1983," ante, at 284.
The Court claims that § 1232g(b), because it references a "policy or practice," has an aggregate focus and thus cannot qualify as an individual right. See ante, at 288 (emphasis deleted). But § 1232g(b) does not simply ban an institution from having a policy or practicewhich would be a more systemic requirement. Rather, it permits a policy or practice of releasing information, so long as "there is written consent from the student's parents specifying records to be released, the reasons for such release, and to whom, and with a copy of the records to be released to the student's parents and the student if desired by the parents." 20 U.S. C. § 1232g(b)(2)(A). The provision speaks of the individual "student," not students generally. In light of FERPA's stated purpose to "protect such individuals' rights to privacy by limiting the transferability of their records without their consent," 120 Cong. Rec. 39862 (1974) (statement of Sen. *296 Buckley), the individual focus of § 1232g(b) is manifest. Moreover, simply because a "pattern or practice" is a precondition to individual relief does not mean that the right asserted is not an individually enforceable right. Cf. Monell v. New York City Dept. of Social Servs., 436 U.S. 658, 690 695 (1978) (authorizing municipal liability under § 1983 when a municipality's "policy or custom" has caused the violation of an individual's federal rights).
Although § 1232g(b) alone provides strong evidence that an individual federal right has been created, this conclusion is bolstered by viewing the provision in the overall context of FERPA. Not once in its opinion does the Court acknowledge the substantial number of references to "rights" in the FERPA provisions surrounding § 1232g(b), even though our past § 1983 cases have made clear that a given statutory provision's meaning is to be discerned "in light of the entire legislative enactment," Suter v. Artist M., 503 U.S. 347, 357 (1992).[4] Rather, ignoring these provisions, the Court asserts that FERPAnot just § 1232g(b)"entirely lack[s]" rights-creating language, ante, at 287. The Court also claims that "we have never before held . . . that spending legislation drafted in terms resembling those of FERPA can confer enforceable rights." Ante, at 279. In making this claim, the Court contrasts FERPA's "[n]o funds shall be made available" language with "individually focused terminology" *297 characteristic of federal antidiscrimination statutes, such as "[n]o person . . . shall . . . be subjected to discrimination," ante, at 287. But the sort of rights-creating language idealized by the Court has never been present in our § 1983 cases; rather, such language ordinarily gives rise to an implied cause of action. See Cannon v. University of Chicago, 441 U.S. 677, 690, n. 13 (1979). None of our four most recent cases involving whether a Spending Clause statute created rights enforceable under § 1983Wright, Wilder, Suter, and Blessing involved the sort of "no person shall" rightscreating language envisioned by the Court. And in two of those casesWright and Wilder we concluded that individual rights enforceable under § 1983 existed. See n. 3, supra.
Although a "presumptively enforceable" right, ante, at 284, has been created by § 1232g(b), one final question remains. As our cases recognize, Congress can rebut the presumption of enforcement under § 1983 either "expressly, by forbidding recourse to § 1983 in the statute itself, or impliedly, by creating a comprehensive enforcement scheme that is incompatible with individual enforcement [actions]." Blessing, 520 U. S., at 341. FERPA has not explicitly foreclosed enforcement under § 1983. The only question, then, is whether the administrative enforcement mechanisms provided by the statute are "comprehensive" and "incompatible" with § 1983 actions. As the Court explains, ante, at 289, FERPA authorizes the establishment of an administrative enforcement framework, and the Secretary of Education has created the Family Policy Compliance Office (FPCO) to "deal with violations" of the Act, 20 U.S. C. § 1232g(f). FPCO accepts complaints from the public concerning alleged FERPA violations and, if it so chooses, may follow up on such a complaint by informing institutions of the steps they must take to comply with FERPA, see 34 CFR §§ 99.63-99.67 (2001), and, in exceptional cases, by administrative adjudication against noncomplying institutions, see 20 U.S. C. § 1234. These administrative *298 avenues fall far short of what is necessary to overcome the presumption of enforceability. We have only found a comprehensive administrative scheme precluding enforceability under § 1983 in two of our past casesMiddlesex County Sewerage Authority v. National Sea Clammers Assn., 453 U.S. 1 (1981), and Smith v. Robinson, 468 U.S. 992 (1984). In Sea Clammers, the relevant statute not only had "unusually elaborate enforcement provisions," but it also permitted private citizens to bring enforcement actions in court. 453 U.S., at 13-14. In Smith, the statute at issue provided for "carefully tailored" administrative proceedings followed by federal judicial review. 468 U.S., at 1009. In contrast, FERPA provides no guaranteed access to a formal administrative proceeding or to federal judicial review; rather, it leaves to administrative discretion the decision whether to follow up on individual complaints. As we said in Blessing, 520 U. S., at 348, the enforcement scheme here is "far more limited than those in Sea Clammers and Smith, " and thus does not preclude enforcement under § 1983.[5]
*299 II
Since FERPA was enacted in 1974, all of the Federal Courts of Appeals expressly deciding the question have concluded that FERPA creates federal rights enforceable under § 1983.[6] Nearly all other federal and state courts reaching the issue agree with these Circuits.[7] Congress has not overruled these decisions by amending FERPA to expressly preclude recourse to § 1983. And yet, the Court departs from over a quarter century of settled law in concluding that FERPA creates no enforceable rights. Perhaps more pernicious than its disturbing of the settled status of FERPA rights, though, is the Court's novel use of our implied right of action cases in determining whether a federal right exists for § 1983 purposes.
In my analysis of whether § 1232g(b) creates a right for § 1983 purposes, I have assumed the Court's forthrightness in stating that the question presented is "whether Congress intended to create a federal right, " ante, at 283, and that "[p]laintiffs suing under § 1983 do not have the burden of showing an intent to create a private remedy," ante, at 284. Rather than proceeding with a straightforward analysis *300 under these principles, however, the Court has undermined both of these assertions by needlessly borrowing from cases involving implied rights of actioncases which place a more exacting standard on plaintiffs. See ante, at 283-286. By using these cases, the Court now appears to require a heightened showing from § 1983 plaintiffs: "[I]f Congress wishes to create new rights enforceable under § 1983, it must do so in clear and unambiguous termsno less and no more than what is required for Congress to create new rights enforceable under an implied private right of action." Ante, at 290.
A requirement that Congress intend a "right to support a cause of action," ante, at 283, as opposed to simply the creation of an individual federal right, makes sense in the implied right of action context. As we have explained, our implied right of action cases "reflec[t] a concern, grounded in separation of powers, that Congress rather than the courts controls the availability of remedies for violations of statutes." Wilder, 496 U. S., at 509, n. 9. However, imposing the implied right of action framework upon the § 1983 inquiry, see ante, at 283-286, is not necessary: The separationof-powers concerns present in the implied right of action context "are not present in a § 1983 case," because Congress expressly authorized private suits in § 1983 itself. Wilder, 496 U. S., at 509, n. 9. Nor is it consistent with our precedent, which has always treated the implied right of action and § 1983 inquiries as separate. See, e. g., ibid.[8]
It has been long recognized that the pertinent question in determining whether a statute provides a basis for a § 1983 suit is whether Congress intended to create individual rights binding on Statesas opposed to mere "precatory terms" that do not "unambiguously" create state obligations, Penn- *301 hurst State School and Hospital v. Halderman, 451 U.S. 1, 17, 18 (1981), or "generalized," "systemwide" duties on States, Blessing, 520 U. S., at 343; Suter, 503 U. S., at 363. What has never before been required is congressional intent specifically to make the right enforceable under § 1983. Yet that is exactly what the Court, at points, appears to require by relying on implied right of action cases: the Court now asks whether "Congress nonetheless intended private suits to be brought before thousands of federal- and state-court judges," ante, at 290.
If it were true, as the Court claims, that the implied right of action and § 1983 inquiries neatly "overlap in one meaningful respectin either case we must first determine whether Congress intended to create a federal right, " ante, at 283, then I would have less trouble referencing implied right of action precedent to determine whether a federal right exists. Contrary to the Court's suggestion, however, our implied right of action cases do not necessarily cleanly separate out the "right" question from the "cause of action" question. For example, in the discussion of rights-creating language in Cannon v. University of Chicago, 441 U.S. 677 (1979), which the Court characterizes as pertaining only to whether there is a right, ante, at 287, Cannon's reasoning is explicitly based on whether there is "reason to infer a private remedy," 441 U.S., at 691, and the "propriety of implication of a cause of action," id., at 690, n. 13. Because Cannon and other implied right of action cases do not clearly distinguish the questions of "right" and "cause of action," it is inappropriate to use these cases to determine whether a statute creates rights enforceable under § 1983.
The Court, however, asserts that it has not imported the entire implied right of action inquiry into the § 1983 context, explaining that while § 1983 plaintiffs share with implied right of action plaintiffs the burden of establishing a federal right, § 1983 plaintiffs "do not have the burden of showing an intent to create a private remedy because § 1983 generally *302 supplies a remedy for the vindication of rights secured by federal statutes." Ante, at 284. If the Court has not adopted such a requirement in the § 1983 contextwhich it purports not to have donethen there should be no difference between the Court's "new" approach to discerning a federal right in the § 1983 context and the test we have "traditionally" used, as articulated in Blessing: whether Congress intended to benefit individual plaintiffs, whether the right asserted is not "`vague and amorphous,' " and whether Congress has placed a binding obligation on the State with respect to the right asserted. 520 U.S., at 340-341. Indeed, the Court's analysis, in part, closely tracks Blessing `s factors, as it examines the statute's language, and the asserted right's individual versus systematic thrust. See ante, at 287-289.
The Court's opinion in other places, however, appears to require more of plaintiffs. By defining the § 1983 plaintiff's burden concerning "whether a statute confers any right at all," ante, at 285, as whether "Congress nonetheless intended private suits to be brought before thousands of federal- and state-court judges," ante, at 290, the Court has collapsed the ostensible two parts of the implied right of action test ("is there a right" and "is it enforceable") into one. As a result, and despite its statement to the contrary, ante, at 284, the Court seems to place the unwarranted "burden of showing an intent to create a private remedy," ibid., on § 1983 plaintiffs. Moreover, by circularly defining a right actionable under § 1983 as, in essence, "a right which Congress intended to make enforceable," the Court has erodedif not evisceratedthe long-established principle of presumptive enforceability of rights under § 1983. Under this reading of the Court's opinion, a right under Blessing is second class compared to a right whose enforcement Congress has clearly intended. Creating such a hierarchy of rights is not only *303 novel, but it blurs the long-recognized distinction between rights and remedies. And it does nothing to clarify our § 1983 jurisprudence.
Accordingly, I respectfully dissent.
| The Court's ratio decidendi in this case has a "now you see it, now you don't" character. At times, the Court seems to hold that the Family Educational Rights and Privacy Act of 1974 (FERPA or Act), 20 U.S. C. 122g, simply does not create any federal rights, thereby disposing of the case with a negative answer to the question "whether Congress intended to create a federal right, " ante, at 28. This interpretation would explain the Court's studious avoidance of the rights-creating language in the title and the text of the Act. Alternatively, its opinion may be read as accepting the proposition that FERPA does indeed create both parental rights of access to student records and student rights of privacy in such records, but that those federal rights are of a lesser value because Congress did not intend them to be enforceable by their owners. See, e. g., ante, at 290 (requiring of respondent "no less and no more" than what is required of plaintiffs attempting to prove that a statute creates an implied right of action). I shall first explain why the statute does, indeed, create federal rights, and then explain why the Court's novel attempt to craft a new category of second-class statutory rights is misguided. I Title 20 U.S. C. 122g, which embodies FERPA in its entirety, includes 10 subsections, which create rights for both students and their parents, and describe the procedures for enforcing and protecting those rights. Subsection (a)(1)(A) accords parents "the right to inspect and review the education records of their children."[1] Subsection (a)(1)(D) provides *294 that a "student or a person applying for admission" may waive "his right of access" to certain confidential statements. Two separate provisions protect students' privacy rights: subsection (a)(2) refers to "the privacy rights of students," and subsection (c) protects "the rights of privacy of students and their families." And subsection (d) provides that after a student has attained the age of 18, "the rights accorded to the parents of the student" shall thereafter be extended to the student. Given such explicit rights-creating language, the title of the statute, which describes "family educational rights," is appropriate: The entire statutory scheme was designed to protect such rights. Of course, as we have stated previously, a "blanket approach" to determining whether a statute creates rights enforceable under 42 U.S. C. 198 (1994 ed., Supp. V) is inappropriate. The precise statutory provision at issue in this case is 122g(b).[2] Although the rights-creating language in this subsection is not as explicit as it is in other parts of the statute, it is clear that, in substance, 122g(b) formulates an individual right: in respondent's words, the "right of parents to withhold consent and prevent the unauthorized release of education record information by an educational *295 institution that has a policy or practice of releasing such information." Brief for Respondent 11. This provision plainly meets the standards we articulated in for establishing a federal right: It is directed to the benefit of individual students and parents; the provision is binding on States, as it is "couched in mandatory, rather than precatory, terms"; and the right is far from "`vague and amorphous,' " -41. Indeed, the right at issue is more specific and clear than rights previously found enforceable under 198 in and both of which involved plaintiffs' entitlement to "reasonable" amounts of money.[] As such, the federal right created by 122g(b) is "presumptively enforceable by 198," ante, at 284. The Court claims that 122g(b), because it references a "policy or practice," has an aggregate focus and thus cannot qualify as an individual right. See ante, at 288 (emphasis deleted). But 122g(b) does not simply ban an institution from having a policy or practicewhich would be a more systemic requirement. Rather, it permits a policy or practice of releasing information, so long as "there is written consent from the student's parents specifying records to be released, the reasons for such release, and to whom, and with a copy of the records to be released to the student's parents and the student if desired by the parents." 20 U.S. C. 122g(b)(2)(A). The provision speaks of the individual "student," not students generally. In light of FERPA's stated purpose to "protect such individuals' rights to privacy by limiting the transferability of their records without their consent," 120 Cong. Rec. 9862 (1974) (statement of Sen. *296 Buckley), the individual focus of 122g(b) is manifest. Moreover, simply because a "pattern or practice" is a precondition to individual relief does not mean that the right asserted is not an individually enforceable right. Cf. (authorizing municipal liability under 198 when a municipality's "policy or custom" has caused the violation of an individual's federal rights). Although 122g(b) alone provides strong evidence that an individual federal right has been created, this conclusion is bolstered by viewing the provision in the overall context of FERPA. Not once in its opinion does the Court acknowledge the substantial number of references to "rights" in the FERPA provisions surrounding 122g(b), even though our past 198 cases have made clear that a given statutory provision's meaning is to be discerned "in light of the entire legislative enactment,"[4] Rather, ignoring these provisions, the Court asserts that FERPAnot just 122g(b)"entirely lack[s]" rights-creating language, ante, at 287. The Court also claims that "we have never before held that spending legislation drafted in terms resembling those of FERPA can confer enforceable rights." Ante, at 279. In making this claim, the Court contrasts FERPA's "[n]o funds shall be made available" language with "individually focused terminology" *297 characteristic of federal antidiscrimination statutes, such as "[n]o person shall be subjected to discrimination," ante, at 287. But the sort of rights-creating language idealized by the Court has never been present in our 198 cases; rather, such language ordinarily gives rise to an implied cause of action. See None of our four most recent cases involving whether a Spending Clause statute created rights enforceable under 198Wright, and involved the sort of "no person shall" rightscreating language envisioned by the Court. And in two of those casesWright and we concluded that individual rights enforceable under 198 existed. See n. Although a "presumptively enforceable" right, ante, at 284, has been created by 122g(b), one final question remains. As our cases recognize, Congress can rebut the presumption of enforcement under 198 either "expressly, by forbidding recourse to 198 in the statute itself, or impliedly, by creating a comprehensive enforcement scheme that is incompatible with individual enforcement [actions]." 520 U. S., at 41. FERPA has not explicitly foreclosed enforcement under 198. The only question, then, is whether the administrative enforcement mechanisms provided by the statute are "comprehensive" and "incompatible" with 198 actions. As the Court explains, ante, at 289, FERPA authorizes the establishment of an administrative enforcement framework, and the Secretary of Education has created the Family Policy Compliance Office (FPCO) to "deal with violations" of the Act, 20 U.S. C. 122g(f). FPCO accepts complaints from the public concerning alleged FERPA violations and, if it so chooses, may follow up on such a complaint by informing institutions of the steps they must take to comply with FERPA, see 4 CFR 99.6-99.67 (2001), and, in exceptional cases, by administrative adjudication against noncomplying institutions, see 20 U.S. C. 124. These administrative *298 avenues fall far short of what is necessary to overcome the presumption of enforceability. We have only found a comprehensive administrative scheme precluding enforceability under 198 in two of our past casesMiddlesex County Sewerage 45 U.S. 1 and In Sea Clammers, the relevant statute not only had "unusually elaborate enforcement provisions," but it also permitted private citizens to bring enforcement actions in 45 U.S., at 1-14. In Smith, the statute at issue provided for "carefully tailored" administrative proceedings followed by federal judicial In contrast, FERPA provides no guaranteed access to a formal administrative proceeding or to federal judicial review; rather, it leaves to administrative discretion the decision whether to follow up on individual complaints. As we said in 520 U. S., at 48, the enforcement scheme here is "far more limited than those in Sea Clammers and Smith, " and thus does not preclude enforcement under 198.[5] *299 II Since FERPA was enacted in 1974, all of the Federal Courts of Appeals expressly deciding the question have concluded that FERPA creates federal rights enforceable under 198.[6] Nearly all other federal and state courts reaching the issue agree with these Circuits.[7] Congress has not overruled these decisions by amending FERPA to expressly preclude recourse to 198. And yet, the Court departs from over a quarter century of settled law in concluding that FERPA creates no enforceable rights. Perhaps more pernicious than its disturbing of the settled status of FERPA rights, though, is the Court's novel use of our implied right of action cases in determining whether a federal right exists for 198 purposes. In my analysis of whether 122g(b) creates a right for 198 purposes, I have assumed the Court's forthrightness in stating that the question presented is "whether Congress intended to create a federal right, " ante, at 28, and that "[p]laintiffs suing under 198 do not have the burden of showing an intent to create a private remedy," ante, at 284. Rather than proceeding with a straightforward analysis *00 under these principles, however, the Court has undermined both of these assertions by needlessly borrowing from cases involving implied rights of actioncases which place a more exacting standard on plaintiffs. See ante, at 28-286. By using these cases, the Court now appears to require a heightened showing from 198 plaintiffs: "[I]f Congress wishes to create new rights enforceable under 198, it must do so in clear and unambiguous termsno less and no more than what is required for Congress to create new rights enforceable under an implied private right of action." Ante, at 290. A requirement that Congress intend a "right to support a cause of action," ante, at 28, as opposed to simply the creation of an individual federal right, makes sense in the implied right of action context. As we have explained, our implied right of action cases "reflec[t] a concern, grounded in separation of powers, that Congress rather than the courts controls the availability of remedies for violations of statutes." n. 9. However, imposing the implied right of action framework upon the 198 inquiry, see ante, at 28-286, is not necessary: The separationof-powers concerns present in the implied right of action context "are not present in a 198 case," because Congress expressly authorized private suits in 198 itself. n. 9. Nor is it consistent with our precedent, which has always treated the implied right of action and 198 inquiries as separate. See, e. g., ibid.[8] It has been long recognized that the pertinent question in determining whether a statute provides a basis for a 198 suit is whether Congress intended to create individual rights binding on Statesas opposed to mere "precatory terms" that do not "unambiguously" create state obligations, Penn- *01 hurst State School and or "generalized," "systemwide" duties on States, 520 U. S., at 4; 50 U. S., at 6. What has never before been required is congressional intent specifically to make the right enforceable under 198. Yet that is exactly what the Court, at points, appears to require by relying on implied right of action cases: the Court now asks whether "Congress nonetheless intended private suits to be brought before thousands of federal- and state-court judges," ante, at 290. If it were true, as the Court claims, that the implied right of action and 198 inquiries neatly "overlap in one meaningful respectin either case we must first determine whether Congress intended to create a federal right, " ante, at 28, then I would have less trouble referencing implied right of action precedent to determine whether a federal right exists. Contrary to the Court's suggestion, however, our implied right of action cases do not necessarily cleanly separate out the "right" question from the "cause of action" question. For example, in the discussion of rights-creating language in which the Court characterizes as pertaining only to whether there is a right, ante, at 287, Cannon's reasoning is explicitly based on whether there is "reason to infer a private remedy," and the "propriety of implication of a cause of action," at Because Cannon and other implied right of action cases do not clearly distinguish the questions of "right" and "cause of action," it is inappropriate to use these cases to determine whether a statute creates rights enforceable under 198. The Court, however, asserts that it has not imported the entire implied right of action inquiry into the 198 context, explaining that while 198 plaintiffs share with implied right of action plaintiffs the burden of establishing a federal right, 198 plaintiffs "do not have the burden of showing an intent to create a private remedy because 198 generally *02 supplies a remedy for the vindication of rights secured by federal statutes." Ante, at 284. If the Court has not adopted such a requirement in the 198 contextwhich it purports not to have donethen there should be no difference between the Court's "new" approach to discerning a federal right in the 198 context and the test we have "traditionally" used, as articulated in : whether Congress intended to benefit individual plaintiffs, whether the right asserted is not "`vague and amorphous,' " and whether Congress has placed a binding obligation on the State with respect to the right asserted. -41. Indeed, the Court's analysis, in part, closely tracks `s factors, as it examines the statute's language, and the asserted right's individual versus systematic thrust. See ante, at 287-289. The Court's opinion in other places, however, appears to require more of plaintiffs. By defining the 198 plaintiff's burden concerning "whether a statute confers any right at all," ante, at 285, as whether "Congress nonetheless intended private suits to be brought before thousands of federal- and state-court judges," ante, at 290, the Court has collapsed the ostensible two parts of the implied right of action test ("is there a right" and "is it enforceable") into one. As a result, and despite its statement to the contrary, ante, at 284, the Court seems to place the unwarranted "burden of showing an intent to create a private remedy," ib on 198 plaintiffs. Moreover, by circularly defining a right actionable under 198 as, in essence, "a right which Congress intended to make enforceable," the Court has erodedif not evisceratedthe long-established principle of presumptive enforceability of rights under 198. Under this reading of the Court's opinion, a right under is second class compared to a right whose enforcement Congress has clearly intended. Creating such a hierarchy of rights is not only *0 novel, but it blurs the long-recognized distinction between rights and remedies. And it does nothing to clarify our 198 jurisprudence. Accordingly, I respectfully dissent. |
Justice Douglas | concurring | true | Clay v. United States | 1971-06-28T00:00:00 | null | https://www.courtlistener.com/opinion/108382/clay-v-united-states/ | https://www.courtlistener.com/api/rest/v3/clusters/108382/ | 1,971 | 1970-143 | 2 | 8 | 0 | I would reverse this judgment of conviction and set the petitioner free.
In Sicurella v. United States, 348 U.S. 385,[1] the wars *706 that the applicant would fight were not "carnal" but those "in defense of Kingdom interests." Id., at 389. Since it was impossible to determine on exactly which grounds the Appeal Board had based its decision, we reversed the decision sustaining the judgment of conviction. We said: "It is difficult for us to believe that the Congress had in mind this type of activity when it said the thrust of conscientious objection must go to `participation in war in any form.' " Id., at 390.
In the present case there is no line between "carnal" war and "spiritual" or symbolic wars. Those who know the history of the Mediterranean littoral know that the jihad of the Moslem was a bloody war.
This case is very close in its essentials to Negre v. Larsen, 401 U.S. 437, decided March 8, 1971. The church to which that registrant belonged favored "just" wars and provided guidelines to define them. The church did not oppose the war in Vietnam but the registrant refused to comply with an order to go to Vietnam because participating in that conflict would violate his conscience. The Court refused to grant him relief as a conscientious objector, overruling his constitutional claim.
The case of Clay is somewhat different, though analogous. While there are some bits of evidence showing conscientious objection to the Vietnam conflict, the basic objection was based on the teachings of his religion. He testified that he was
"sincere in every bit of what the Holy Qur'an and *707 the teachings of the Honorable Elijah Muhammad tell us and it is that we are not to participate in wars on the side of nobody whoon the side of nonbelievers, and this is a Christian country and this is not a Muslim country, and the Government and the history and the facts shows that every move toward the Honorable Elijah Muhammad is made to distort and is made to ridicule him and is made to condemn him and the Government has admitted that the police of Los Angeles were wrong about attacking and killing our brothers and sisters and they were wrong in Newark, New Jersey, and they were wrong in Louisiana, and the outright, every day oppressors and enemies are the people as a whole, the whites of this nation. So, we are not, according to the Holy Qur'an, to even as much as aid in passing a cup of water to theeven a wounded. I mean, this is in the Holy Qur'an, and as I said earlier, this is not me talking to get the draft boardor to dodge nothing. This is there before I was borned and it will be there when I'm dead but we believe in not only that part of it, but all of it."
At another point he testified: "[T]he Holy Qur'an do teach us that we do not take part ofin any part of war unless declared by Allah himself, or unless it's an Islamic World War, or a Holy War, and it goes as far the Holy Qur'an is talking still, and saying we are not to even as much as aid the infidels or the nonbelievers in Islam, even to as much as handing them a cup of water during battle."
"So, this is the teachings of the Holy Qur'an before I was born, and the Qur'an, we follow not only that part of it, but every part."
*708 The Koran defines jihad as an injunction to the believers to war against nonbelievers:[2]
"O ye who believe! Shall I guide you to a gainful trade which will save you from painful punishment? Believe in Allah and His Apostle and carry on warfare (jihad) in the path of Allah with your possessions and your persons. That is better for you. If ye have knowledge, He will forgive your sins, and will place you in the Gardens beneath which the streams flow, and in fine houses in the Gardens of Eden: that is the great gain." M. Khadduri, War and Peace in the Law of Islam 55-56 (1955).
The Sale edition of the Koran, which first appeared in England in 1734, gives the following translation at 410-411 (9th ed. 1923):
"Thus God propoundeth unto men their examples. When ye encounter the unbelievers, strike off their heads, until ye have made a great slaughter among them; and bind them in bonds; and either give them a free dismission afterwards, or exact a ransom; until the war shall have laid down its arms. This shall ye do. Verily if God pleased he could take vengeance on them, without your assistance; but he commandeth you to fight his battles, that he may prove the one of you by the other. And as to those who fight in defence of God's true religion, God will not suffer their works to perish: he will guide them, and will dispose their heart aright; and *709 he will lead them into paradise, of which he hath told them. O true believers, if ye assist God, by fighting for his religion, he will assist you against your enemies; and will set your feet fast. . . ."
War is not the exclusive type of jihad; there is action by the believer's heart, by his tongue, by his hands, as well as by the sword. War and Peace in the Law of Islam 56. As respects the military aspects it is written:
"The jihad, in other words, is a sanction against polytheism and must be suffered by all non-Muslims who reject Islam, or, in the case of the dhimmis (Scripturaries), refuse to pay the poll tax. The jihad, therefore, may be defined as the litigation between Islam and polytheism; it is also a form of punishment to be inflicted upon Islam's enemies and the renegades from the faith. Thus in Islam, as in Western Christendom, the jihad is the bellum justum." Id., at 59.
The jihad is the Moslem's counterpart of the "just" war as it has been known in the West.[3] Neither Clay nor Negre should be subject to punishment because he will not renounce the "truth" of the teaching of his respective church that wars indeed may exist which are just wars in which a Moslem or Catholic has a respective duty to participate.
What Clay's testimony adds up to is that he believes only in war as sanctioned by the Koran, that is to say, a religious war against nonbelievers. All other wars are unjust.
That is a matter of belief, of conscience, of religious principle. Both Clay and Negre were "by reason of religious *710 training and belief" conscientiously opposed to participation in war of the character proscribed by their respective religions. That belief is a matter of conscience protected by the First Amendment which Congress has no power to qualify or dilute as it did in § 6 (j) of the Military Selective Service Act of 1967, 50 U.S. C. App. § 456 (j) (1964 ed., Supp. V) when it restricted the exemption to those "conscientiously opposed to participation in war in any form." For the reasons I stated in Negre and in Gillette v. United States, 401 U.S. 437, 463 and 470, that construction puts Clay in a class honored by the First Amendment, even though those schooled in a different conception of "just" wars may find it quite irrational.
I would reverse the judgment below.
MR. JUSTICE HARLAN, concurring in the result.
I concur in the result on the following ground. The Department of Justice advice letter was at least susceptible of the reading that petitioner's proof of sincerity was insufficient as a matter of law because his conscientious objector claim had not been timely asserted. This would have been erroneous advice had the Department's letter been so read. Since the Appeals Board might have acted on such an interpretation of the letter, reversal is required under Sicurella v. United States, 348 U.S. 385 (1955).
| I would reverse this judgment of conviction and set the petitioner free. In[1] the wars *706 that the applicant would fight were not "carnal" but those "in defense of Kingdom interests." Since it was impossible to determine on exactly which grounds the Appeal Board had based its decision, we reversed the decision sustaining the judgment of conviction. We said: "It is difficult for us to believe that the Congress had in mind this type of activity when it said the thrust of conscientious objection must go to `participation in war in any form.' " In the present case there is no line between "carnal" war and "spiritual" or symbolic wars. Those who know the history of the Mediterranean littoral know that the jihad of the Moslem was a bloody war. This case is very close in its essentials to decided March 8, 1971. The church to which that registrant belonged favored "just" wars and provided guidelines to define them. The church did not oppose the war in Vietnam but the registrant refused to comply with an order to go to Vietnam because participating in that conflict would violate his conscience. The Court refused to grant him relief as a conscientious objector, overruling his constitutional claim. The case of Clay is somewhat different, though analogous. While there are some bits of evidence showing conscientious objection to the Vietnam conflict, the basic objection was based on the teachings of his religion. He testified that he was "sincere in every bit of what the Holy Qur'an and *707 the teachings of the Honorable Elijah Muhammad tell us and it is that we are not to participate in wars on the side of nobody whoon the side of nonbelievers, and this is a Christian country and this is not a Muslim country, and the Government and the history and the facts shows that every move toward the Honorable Elijah Muhammad is made to distort and is made to ridicule him and is made to condemn him and the Government has admitted that the police of Los Angeles were wrong about attacking and killing our brothers and sisters and they were wrong in Newark, New Jersey, and they were wrong in Louisiana, and the outright, every day oppressors and enemies are the people as a whole, the whites of this nation. So, we are not, according to the Holy Qur'an, to even as much as aid in passing a cup of water to theeven a wounded. I mean, this is in the Holy Qur'an, and as I said earlier, this is not me talking to get the draft boardor to dodge nothing. This is there before I was borned and it will be there when I'm dead but we believe in not only that part of it, but all of it." At another point he testified: "[T]he Holy Qur'an do teach us that we do not take part ofin any part of war unless declared by Allah himself, or unless it's an Islamic World War, or a Holy War, and it goes as far the Holy Qur'an is talking still, and saying we are not to even as much as aid the infidels or the nonbelievers in Islam, even to as much as handing them a cup of water during battle." "So, this is the teachings of the Holy Qur'an before I was born, and the Qur'an, we follow not only that part of it, but every part." *708 The Koran defines jihad as an injunction to the believers to war against nonbelievers:[2] "O ye who believe! Shall I guide you to a gainful trade which will save you from painful punishment? Believe in Allah and His Apostle and carry on warfare (jihad) in the path of Allah with your possessions and your persons. That is better for you. If ye have knowledge, He will forgive your sins, and will place you in the Gardens beneath which the streams flow, and in fine houses in the Gardens of Eden: that is the great gain." M. Khadduri, War and Peace in the Law of Islam 55-56 The Sale edition of the Koran, which first appeared in England in 1734, gives the following translation at 410-411 (9th ed. 1923): "Thus God propoundeth unto men their examples. When ye encounter the unbelievers, strike off their heads, until ye have made a great slaughter among them; and bind them in bonds; and either give them a free dismission afterwards, or exact a ransom; until the war shall have laid down its arms. This shall ye do. Verily if God pleased he could take vengeance on them, without your assistance; but he commandeth you to fight his battles, that he may prove the one of you by the other. And as to those who fight in defence of God's true religion, God will not suffer their works to perish: he will guide them, and will dispose their heart aright; and *709 he will lead them into paradise, of which he hath told them. O true believers, if ye assist God, by fighting for his religion, he will assist you against your enemies; and will set your feet fast." War is not the exclusive type of jihad; there is action by the believer's heart, by his tongue, by his hands, as well as by the sword. War and Peace in the Law of Islam 56. As respects the military aspects it is written: "The jihad, in other words, is a sanction against polytheism and must be suffered by all non-Muslims who reject Islam, or, in the case of the dhimmis (Scripturaries), refuse to pay the poll tax. The jihad, therefore, may be defined as the litigation between Islam and polytheism; it is also a form of punishment to be inflicted upon Islam's enemies and the renegades from the faith. Thus in Islam, as in Western Christendom, the jihad is the bellum justum." The jihad is the Moslem's counterpart of the "just" war as it has been known in the West.[3] Neither Clay nor Negre should be subject to punishment because he will not renounce the "truth" of the teaching of his respective church that wars indeed may exist which are just wars in which a Moslem or Catholic has a respective duty to participate. What Clay's testimony adds up to is that he believes only in war as sanctioned by the Koran, that is to say, a religious war against nonbelievers. All other wars are unjust. That is a matter of belief, of conscience, of religious principle. Both Clay and Negre were "by reason of religious *710 training and belief" conscientiously opposed to participation in war of the character proscribed by their respective religions. That belief is a matter of conscience protected by the First Amendment which Congress has no power to qualify or dilute as it did in 6 (j) of the Military Selective Service Act of 1967, 50 U.S. C. App. 456 (j) (1964 ed., Supp. V) when it restricted the exemption to those "conscientiously opposed to participation in war in any form." For the reasons I stated in Negre and in 463 and 470, that construction puts Clay in a class honored by the First Amendment, even though those schooled in a different conception of "just" wars may find it quite irrational. I would reverse the judgment below. MR. JUSTICE HARLAN, concurring in the result. I concur in the result on the following ground. The Department of Justice advice letter was at least susceptible of the reading that petitioner's proof of sincerity was insufficient as a matter of law because his conscientious objector claim had not been timely asserted. This would have been erroneous advice had the Department's letter been so read. Since the Appeals Board might have acted on such an interpretation of the letter, reversal is required under |
Justice Stewart | majority | false | Geduldig v. Aiello | 1974-06-17T00:00:00 | null | https://www.courtlistener.com/opinion/109065/geduldig-v-aiello/ | https://www.courtlistener.com/api/rest/v3/clusters/109065/ | 1,974 | 1973-137 | 1 | 6 | 3 | For almost 30 years California has administered a disability insurance system that pays benefits to persons in private employment who are temporarily unable to work because of disability not covered by workmen's compensation. The appellees brought this action to challenge the constitutionality of a provision of the California program that, in defining "disability," excludes from coverage certain disabilities resulting from pregnancy. Because the appellees sought to enjoin the enforcement of this state statute, a three-judge court was convened pursuant to 28 U.S. C. §§ 2281 and 2284.[1] On *487 the appellees' motion for summary judgment, the District Court, by a divided vote, held that this provision of the disability insurance program violates the Equal Protection Clause of the Fourteenth Amendment, and therefore enjoined its continued enforcement. 359 F. Supp. 792. The District Court denied a motion to stay its judgment pending appeal. The appellant thereupon filed a similar motion in this Court, which we granted. 414 U.S. 897. We subsequently noted probable jurisdiction of the appeal. 414 U.S. 1110.
I
California's disability insurance system is funded entirely from contributions deducted from the wages of participating employees. Participation in the program is mandatory unless the employees are protected by a voluntary private plan approved by the State.[2] Each employee is required to contribute one percent of his salary, up to an annual maximum of $85.[3] These contributions are placed in the Unemployment Compensation Disability Fund, which is established and administered as a special trust fund within the state treasury.[4] It is from this Disability Fund that benefits under the program are paid.
An individual is eligible for disability benefits if, during a one-year base period prior to his disability, he has contributed one percent of a minimum income of $300 to the Disability Fund.[5] In the event he suffers a compensable disability, the individual can receive a "weekly benefit amount" of between $25 and $105, depending on the amount he earned during the highest quarter of the *488 base period.[6] Benefits are not paid until the eighth day of disability, unless the employee is hospitalized, in which case benefits commence on the first day of hospitalization.[7] In addition to the "weekly benefit amount," a hospitalized employee is entitled to receive "additional benefits" of $12 per day of hospitalization.[8] "Weekly benefit amounts" for any one disability are payable for 26 weeks so long as the total amount paid does not exceed one-half of the wages received during the base period.[9] "Additional benefits" for any one disability are paid for a maximum of 20 days.[10]
In return for his one-percent contribution to the Disability Fund, the individual employee is insured against the risk of disability stemming from a substantial number of "mental or physical illness[es] and mental or physical injur[ies]." Cal. Unemp. Ins. Code § 2626. It is not every disabling condition, however, that triggers the obligation to pay benefits under the program. As already noted, for example, any disability of less than eight days' duration is not compensable, except when the employee is hospitalized. Conversely, no benefits are payable for any single disability beyond 26 weeks. Further, disability is not compensable if it results from the individual's court commitment as a dipsomaniac, drug addict, or sexual psychopath.[11] Finally, § 2626 of the Unemployment *489 Insurance Code excludes from coverage certain disabilities that are attributable to pregnancy. It is this provision that is at issue in the present case.
Appellant is the Director of the California Department of Human Resources Development.[12] He is responsible for the administration of the State's disability insurance program. Appellees are four women who have paid sufficient amounts into the Disability Fund to be eligible for benefits under the program. Each of the appellees became pregnant and suffered employment disability as a result of her pregnancy. With respect to three of the appellees, Carolyn Aiello, Augustina Armendariz, and Elizabeth Johnson, the disabilities were attributable to abnormal complications encountered during their pregnancies.[13] The fourth, Jacqueline Jaramillo, experienced a normal pregnancy, which was the sole cause of her disability.
At all times relevant to this case, § 2626 of the Unemployment Insurance Code provided:
" `Disability' or `disabled' includes both mental or physical illness and mental or physical injury. An individual shall be deemed disabled in any day in which, because of his physical or mental condition, he is unable to perform his regular or customary work. In no case shall the term `disability' or `disabled' include any injury or illness caused by or arising in connection with pregnancy up to the termination of such pregnancy and for a period of 28 days thereafter." (Emphasis added.)
*490 Appellant construed and applied the final sentence of this statute to preclude the payment of benefits for any disability resulting from pregnancy. As a result, the appellees were ruled ineligible for disability benefits by reason of this provision, and they sued to enjoin its enforcement. The District Court, finding "that the exclusion of pregnancy-related disabilities is not based upon a classification having a rational and substantial relationship to a legitimate state purpose," held that the exclusion was unconstitutional under the Equal Protection Clause. 359 F. Supp., at 801.
Shortly before the District Court's decision in this case, the California Court of Appeal, in a suit brought by a woman who suffered an ectopic pregnancy, held that § 2626 does not bar the payment of benefits on account of disability that results from medical complications arising during pregnancy. Rentzer v. Unemployment Insurance Appeals Board, 32 Cal. App. 3d 604, 108 Cal. Rptr. 336 (1973).[14] The state court construed the statute to preclude only the payment of benefits for disability accompanying normal pregnancy.[15] The appellant *491 acquiesced in this construction and issued administrative guidelines that exclude only the payment of "maternity benefits"i. e., hospitalization and disability benefits for normal delivery and recuperation.
Although Rentzer was decided some 10 days before the District Court's decision in this case, there was apparently no opportunity to call the court's attention to it. The appellant, therefore, asked the court to reconsider its decision in light of the construction that the California Court of Appeal had given to § 2626 in the Rentzer case. By a divided vote, the court denied the motion for reconsideration. Although a more definitive ruling would surely have been preferable, we interpret the District Court's denial of the appellant's motion as a determination that its decision was not affected by the limiting construction given to § 2626 in Rentzer.
Because of the Rentzer decision and the revised administrative guidelines that resulted from it, the appellees Aiello, Armendariz, and Johnson, whose disabilities were attributable to causes other than normal pregnancy and delivery, became entitled to benefits under the disability insurance program, and their claims have since been paid. With respect to appellee Jaramillo, however, whose disability stemmed solely from normal pregnancy and childbirth, § 2626 continues to bar the *492 payment of any benefits. It is evident that only Jaramillo continues to have a live controversy with the appellant as to the validity of § 2626. The claims of the other appellees have been mooted by the change that Rentzer worked in the construction and application of that provision. Thus, the issue before the Court on this appeal is whether the California disability insurance program invidiously discriminates against Jaramillo and others similarly situated by not paying insurance benefits for disability that accompanies normal pregnancy and childbirth.
II
It is clear that California intended to establish this benefit system as an insurance program that was to function essentially in accordance with insurance concepts.[16] Since the program was instituted in 1946, it has been totally self-supporting, never drawing on general state revenues to finance disability or hospital benefits. The Disability Fund is wholly supported by the one percent of wages annually contributed by participating employees. At oral argument, counsel for the appellant informed us that in recent years between 90% and *493 103% of the revenue to the Disability Fund has been paid out in disability and hospital benefits. This history strongly suggests that the one-percent contribution rate, in addition to being easily computable, bears a close and substantial relationship to the level of benefits payable and to the disability risks insured under the program.
Over the years California has demonstrated a strong commitment not to increase the contribution rate above the one-percent level. The State has sought to provide the broadest possible disability protection that would be affordable by all employees, including those with very low incomes. Because any larger percentage or any flat dollar-amount rate of contribution would impose an increasingly regressive levy bearing most heavily upon those with the lowest incomes, the State has resisted any attempt to change the required contribution from the one-percent level. The program is thus structured, in terms of the level of benefits and the risks insured, to maintain the solvency of the Disability Fund at a one-percent annual level of contribution.[17]
In ordering the State to pay benefits for disability accompanying normal pregnancy and delivery, the District Court acknowledged the State's contention "that coverage of these disabilities is so extraordinarily expensive that it would be impossible to maintain a program supported by employee contributions if these disabilities are included." 359 F. Supp., at 798. There is considerable disagreement between the parties with respect to how great the increased costs would actually be, but they *494 would clearly be substantial.[18] For purposes of analysis the District Court accepted the State's estimate, which was in excess of $100 million annually, and stated: "[I]t is clear that including these disabilities would not destroy the program. The increased costs could be accommodated quite easily by making reasonable changes in the contribution rate, the maximum benefits allowable, and the other variables affecting the solvency of the program." Ibid.
Each of these "variables"the benefit level deemed appropriate to compensate employee disability, the risks selected to be insured under the program, and the contribution rate chosen to maintain the solvency of the program and at the same time to permit low-income employees to participate with minimal personal sacrifice represents a policy determination by the State. The essential issue in this case is whether the Equal Protection Clause requires such policies to be sacrificed or compromised in order to finance the payment of benefits to those whose disability is attributable to normal pregnancy and delivery.
We cannot agree that the exclusion of this disability from coverage amounts to invidious discrimination under the Equal Protection Clause. California does not discriminate with respect to the persons or groups which are eligible for disability insurance protection under the program. The classification challenged in this case relates to the asserted underinclusiveness of the set of risks that the State has selected to insure. Although California has created a program to insure most risks of employment *495 disability, it has not chosen to insure all such risks, and this decision is reflected in the level of annual contributions exacted from participating employees. This Court has held that, consistently with the Equal Protection Clause, a State "may take one step at a time, addressing itself to the phase of the problem which seems most acute to the legislative mind. . . . The legislature may select one phase of one field and apply a remedy there, neglecting the others. . . ." Williamson v. Lee Optical Co., 348 U.S. 483, 489 (1955); Jefferson v. Hackney, 406 U.S. 535 (1972). Particularly with respect to social welfare programs, so long as the line drawn by the State is rationally supportable, the courts will not interpose their judgment as to the appropriate stopping point. "[T]he Equal Protection Clause does not require that a State must choose between attacking every aspect of a problem or not attacking the problem at all." Dandridge v. Williams, 397 U.S. 471, 486-487 (1970).
The District Court suggested that moderate alterations in what it regarded as "variables" of the disability insurance program could be made to accommodate the substantial expense required to include normal pregnancy within the program's protection. The same can be said, however, with respect to the other expensive class of disabilities that are excluded from coverageshort-term disabilities. If the Equal Protection Clause were thought to compel disability payments for normal pregnancy, it is hard to perceive why it would not also compel payments for short-term disabilities suffered by participating employees.[19]
It is evident that a totally comprehensive program would be substantially more costly than the present program and would inevitably require state subsidy, a higher *496 rate of employee contribution, a lower scale of benefits for those suffering insured disabilities, or some combination of these measures. There is nothing in the Constitution, however, that requires the State to subordinate or compromise its legitimate interests solely to create a more comprehensive social insurance program than it already has.
The State has a legitimate interest in maintaining the self-supporting nature of its insurance program. Similarly, it has an interest in distributing the available resources in such a way as to keep benefit payments at an adequate level for disabilities that are covered, rather than to cover all disabilities inadequately. Finally, California has a legitimate concern in maintaining the contribution rate at a level that will not unduly burden participating employees, particularly low-income employees who may be most in need of the disability insurance.
These policies provide an objective and wholly non-invidious basis for the State's decision not to create a more comprehensive insurance program than it has. There is no evidence in the record that the selection of the risks insured by the program worked to discriminate against any definable group or class in terms of the aggregate risk protection derived by that group or class from the program.[20] There is no risk from which men are protected *497 and women are not. Likewise, there is no risk from which women are protected and men are not.[21]
The appellee simply contends that, although she has received insurance protection equivalent to that provided all other participating employees, she has suffered discrimination because she encountered a risk that was outside the program's protection. For the reasons we have stated, we hold that this contention is not a valid one under the Equal Protection Clause of the Fourteenth Amendment.
The stay heretofore issued by the Court is vacated, and the judgment of the District Court is
Reversed.
MR. JUSTICE BRENNAN, with whom MR. JUSTICE DOUGLAS and MR. | For almost 30 years California has administered a disability insurance system that pays benefits to persons in private employment who are temporarily unable to work because of disability not covered by workmen's compensation. The appellees brought this action to challenge the constitutionality of a provision of the California program that, in defining "disability," excludes from coverage certain disabilities resulting from pregnancy. Because the appellees sought to enjoin the enforcement of this state statute, a three-judge court was convened pursuant to 28 U.S. C. 2281 and 2284.[1] On *487 the appellees' motion for summary judgment, the District Court, by a divided vote, held that this provision of the disability insurance program violates the Equal Protection Clause of the Fourteenth Amendment, and therefore enjoined its continued enforcement. The District Court denied a motion to stay its judgment pending appeal. The appellant thereupon filed a similar motion in this Court, which we granted. We subsequently noted probable jurisdiction of the appeal. I California's disability insurance system is funded entirely from contributions deducted from the wages of participating employees. Participation in the program is mandatory unless the employees are protected by a voluntary private plan approved by the State.[2] Each employee is required to contribute one percent of his salary, up to an annual maximum of $85.[3] These contributions are placed in the Unemployment Compensation Disability Fund, which is established and administered as a special trust fund within the state treasury.[4] It is from this Disability Fund that benefits under the program are paid. An individual is eligible for disability benefits if, during a one-year base period prior to his disability, he has contributed one percent of a minimum income of $300 to the Disability Fund.[5] In the event he suffers a compensable disability, the individual can receive a "weekly benefit amount" of between $25 and $105, depending on the amount he earned during the highest quarter of the *488 base period.[6] Benefits are not paid until the eighth day of disability, unless the employee is hospitalized, in which case benefits commence on the first day of hospitalization.[7] In addition to the "weekly benefit amount," a hospitalized employee is entitled to receive "additional benefits" of $12 per day of hospitalization.[8] "Weekly benefit amounts" for any one disability are payable for 26 weeks so long as the total amount paid does not exceed one-half of the wages received during the base period.[9] "Additional benefits" for any one disability are paid for a maximum of 20 days.[10] In return for his one-percent contribution to the Disability Fund, the individual employee is insured against the risk of disability stemming from a substantial number of "mental or physical illness[es] and mental or physical injur[ies]." It is not every disabling condition, however, that triggers the obligation to pay benefits under the program. As already noted, for example, any disability of less than eight days' duration is not compensable, except when the employee is hospitalized. Conversely, no benefits are payable for any single disability beyond 26 weeks. Further, disability is not compensable if it results from the individual's court commitment as a dipsomaniac, drug addict, or sexual psychopath.[11] Finally, 2626 of the Unemployment * Insurance Code excludes from coverage certain disabilities that are attributable to pregnancy. It is this provision that is at issue in the present case. Appellant is the Director of the California Department of Human Resources Development.[12] He is responsible for the administration of the State's disability insurance program. Appellees are four women who have paid sufficient amounts into the Disability Fund to be eligible for benefits under the program. Each of the appellees became pregnant and suffered employment disability as a result of her pregnancy. With respect to three of the appellees, Carolyn Aiello, Augustina Armendariz, and Elizabeth Johnson, the disabilities were attributable to abnormal complications encountered during their pregnancies.[13] The fourth, Jacqueline Jaramillo, experienced a normal pregnancy, which was the sole cause of her disability. At all times relevant to this case, 2626 of the Unemployment Insurance Code provided: " `Disability' or `disabled' includes both mental or physical illness and mental or physical injury. An individual shall be deemed disabled in any day in which, because of his physical or mental condition, he is unable to perform his regular or customary work. In no case shall the term `disability' or `disabled' include any injury or illness caused by or arising in connection with pregnancy up to the termination of such pregnancy and for a period of 28 days thereafter." (Emphasis added.) *490 Appellant construed and applied the final sentence of this statute to preclude the payment of benefits for any disability resulting from pregnancy. As a result, the appellees were ruled ineligible for disability benefits by reason of this provision, and they sued to enjoin its enforcement. The District Court, finding "that the exclusion of pregnancy-related disabilities is not based upon a classification having a rational and substantial relationship to a legitimate state purpose," held that the exclusion was unconstitutional under the Equal Protection Shortly before the District Court's decision in this case, the California Court of Appeal, in a suit brought by a woman who suffered an ectopic pregnancy, held that 2626 does not bar the payment of benefits on account of disability that results from medical complications arising during pregnancy.[14] The state court construed the statute to preclude only the payment of benefits for disability accompanying normal pregnancy.[15] The appellant *491 acquiesced in this construction and issued administrative guidelines that exclude only the payment of "maternity benefits"i. e., hospitalization and disability benefits for normal delivery and recuperation. Although Rentzer was decided some 10 days before the District Court's decision in this case, there was apparently no opportunity to call the court's attention to it. The appellant, therefore, asked the court to reconsider its decision in light of the construction that the California Court of Appeal had given to 2626 in the Rentzer case. By a divided vote, the court denied the motion for reconsideration. Although a more definitive ruling would surely have been preferable, we interpret the District Court's denial of the appellant's motion as a determination that its decision was not affected by the limiting construction given to 2626 in Rentzer. Because of the Rentzer decision and the revised administrative guidelines that resulted from it, the appellees Aiello, Armendariz, and Johnson, whose disabilities were attributable to causes other than normal pregnancy and delivery, became entitled to benefits under the disability insurance program, and their claims have since been paid. With respect to appellee Jaramillo, however, whose disability stemmed solely from normal pregnancy and childbirth, 2626 continues to bar the *492 payment of any benefits. It is evident that only Jaramillo continues to have a live controversy with the appellant as to the validity of 2626. The claims of the other appellees have been mooted by the change that Rentzer worked in the construction and application of that provision. Thus, the issue before the Court on this appeal is whether the California disability insurance program invidiously discriminates against Jaramillo and others similarly situated by not paying insurance benefits for disability that accompanies normal pregnancy and childbirth. II It is clear that California intended to establish this benefit system as an insurance program that was to function essentially in accordance with insurance concepts.[16] Since the program was instituted in 1946, it has been totally self-supporting, never drawing on general state revenues to finance disability or hospital benefits. The Disability Fund is wholly supported by the one percent of wages annually contributed by participating employees. At oral argument, counsel for the appellant informed us that in recent years between 90% and *493 103% of the revenue to the Disability Fund has been paid out in disability and hospital benefits. This history strongly suggests that the one-percent contribution rate, in addition to being easily computable, bears a close and substantial relationship to the level of benefits payable and to the disability risks insured under the program. Over the years California has demonstrated a strong commitment not to increase the contribution rate above the one-percent level. The State has sought to provide the broadest possible disability protection that would be affordable by all employees, including those with very low incomes. Because any larger percentage or any flat dollar-amount rate of contribution would impose an increasingly regressive levy bearing most heavily upon those with the lowest incomes, the State has resisted any attempt to change the required contribution from the one-percent level. The program is thus structured, in terms of the level of benefits and the risks insured, to maintain the solvency of the Disability Fund at a one-percent annual level of contribution.[17] In ordering the State to pay benefits for disability accompanying normal pregnancy and delivery, the District Court acknowledged the State's contention "that coverage of these disabilities is so extraordinarily expensive that it would be impossible to maintain a program supported by employee contributions if these disabilities are included." There is considerable disagreement between the parties with respect to how great the increased costs would actually be, but they *494 would clearly be substantial.[18] For purposes of analysis the District Court accepted the State's estimate, which was in excess of $100 million annually, and stated: "[I]t is clear that including these disabilities would not destroy the program. The increased costs could be accommodated quite easily by making reasonable changes in the contribution rate, the maximum benefits allowable, and the other variables affecting the solvency of the program." Each of these "variables"the benefit level deemed appropriate to compensate employee disability, the risks selected to be insured under the program, and the contribution rate chosen to maintain the solvency of the program and at the same time to permit low-income employees to participate with minimal personal sacrifice represents a policy determination by the State. The essential issue in this case is whether the Equal Protection Clause requires such policies to be sacrificed or compromised in order to finance the payment of benefits to those whose disability is attributable to normal pregnancy and delivery. We cannot agree that the exclusion of this disability from coverage amounts to invidious discrimination under the Equal Protection California does not discriminate with respect to the persons or groups which are eligible for disability insurance protection under the program. The classification challenged in this case relates to the asserted underinclusiveness of the set of risks that the State has selected to insure. Although California has created a program to insure most risks of employment *495 disability, it has not chosen to insure all such risks, and this decision is reflected in the level of annual contributions exacted from participating employees. This Court has held that, consistently with the Equal Protection Clause, a State "may take one step at a time, addressing itself to the phase of the problem which seems most acute to the legislative mind. The legislature may select one phase of one field and apply a remedy there, neglecting the others." ; Particularly with respect to social welfare programs, so long as the line drawn by the State is rationally supportable, the courts will not interpose their judgment as to the appropriate stopping point. "[T]he Equal Protection Clause does not require that a State must choose between attacking every aspect of a problem or not attacking the problem at all." The District Court suggested that moderate alterations in what it regarded as "variables" of the disability insurance program could be made to accommodate the substantial expense required to include normal pregnancy within the program's protection. The same can be said, however, with respect to the other expensive class of disabilities that are excluded from coverageshort-term disabilities. If the Equal Protection Clause were thought to compel disability payments for normal pregnancy, it is hard to perceive why it would not also compel payments for short-term disabilities suffered by participating employees.[19] It is evident that a totally comprehensive program would be substantially more costly than the present program and would inevitably require state subsidy, a higher *496 rate of employee contribution, a lower scale of benefits for those suffering insured disabilities, or some combination of these measures. There is nothing in the Constitution, however, that requires the State to subordinate or compromise its legitimate interests solely to create a more comprehensive social insurance program than it already has. The State has a legitimate interest in maintaining the self-supporting nature of its insurance program. Similarly, it has an interest in distributing the available resources in such a way as to keep benefit payments at an adequate level for disabilities that are covered, rather than to cover all disabilities inadequately. Finally, California has a legitimate concern in maintaining the contribution rate at a level that will not unduly burden participating employees, particularly low-income employees who may be most in need of the disability insurance. These policies provide an objective and wholly non-invidious basis for the State's decision not to create a more comprehensive insurance program than it has. There is no evidence in the record that the selection of the risks insured by the program worked to discriminate against any definable group or class in terms of the aggregate risk protection derived by that group or class from the program.[20] There is no risk from which men are protected *497 and women are not. Likewise, there is no risk from which women are protected and men are not.[21] The appellee simply contends that, although she has received insurance protection equivalent to that provided all other participating employees, she has suffered discrimination because she encountered a risk that was outside the program's protection. For the reasons we have stated, we hold that this contention is not a valid one under the Equal Protection Clause of the Fourteenth Amendment. The stay heretofore issued by the Court is vacated, and the judgment of the District Court is Reversed. MR. JUSTICE BRENNAN, with whom MR. JUSTICE DOUGLAS and MR. |
Justice Brennan | majority | false | Michelin Tire Corp. v. Wages | 1976-01-14T00:00:00 | null | https://www.courtlistener.com/opinion/109344/michelin-tire-corp-v-wages/ | https://www.courtlistener.com/api/rest/v3/clusters/109344/ | 1,976 | 1975-024 | 2 | 8 | 0 | Respondents, the Tax Commissioner and Tax Assessors of Gwinnett County, Ga., assessed ad valorem property taxes against tires and tubes imported by petitioner from France and Nova Scotia that were included on the assessment dates in an inventory maintained at its wholesale distribution warehouse in the county. Petitioner brought this action for declaratory and injunctive relief in the Superior Court of Gwinnett County, alleging that with the exception of certain passenger tubes that had been removed from the original shipping cartons,[1] the ad valorem property taxes assessed against *279 its inventory of imported tires and tubes were prohibited by Art. I, § 10, cl. 2, of the Constitution, which provides in pertinent part: "No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws . . . ." After trial, the Superior Court granted the requested declaratory and injunctive relief. On appeal, the Supreme Court of Georgia affirmed in part and reversed in part, agreeing that the tubes in the corrugated shipping cartons were immune from ad valorem taxation, but holding that the tires had lost their status as imports and had become subject to such taxation because they had been mingled with other tires imported in bulk, sorted, and arranged for sale. 233 Ga. 712, 214 S.E.2d 349 (1975). We granted certiorari, 422 U.S. 1040 (1975). The only question presented is whether the Georgia Supreme Court was correct in holding that the tires were subject to the ad valorem property tax.[2] We affirm without addressing the question whether the Georgia Supreme Court was correct in holding that the tires had lost their status as imports. We hold that, in any event, Georgia's assessment of a nondiscriminatory ad valorem property tax against the imported tires is not within the constitutional prohibition against laying "any Imposts or Duties on Imports. . ." and that insofar as Low v. Austin, 13 Wall. 29 (1872) is to the contrary, that decision is overruled.
I
Petitioner, a New York corporation qualified to do business in Georgia, operates as an importer and wholesale *280 distributor in the United States of automobile and truck tires and tubes manufactured in France and Nova Scotia by Michelin Tires, Ltd. The business is operated from distribution warehouses in various parts of the country. Distribution and sale of tires and tubes from the Gwinnett County warehouse is limited to the 250-300 franchised dealers with whom petitioner does all of its business in six southeastern States. Some 25% of the tires and tubes are manufactured in and imported from Nova Scotia, and are brought to the United States in tractor-driven, over-the-road trailers packed and sealed at the Nova Scotia factory. The remaining 75% of the imported tires and tubes are brought to the United States by sea from France and Nova Scotia in sea vans packed and sealed at the foreign factories. Sea vans are essentially over-the-road trailers from which the wheels are removed before being loaded aboard ship. Upon arrival of the ship at the United States port of entry, the vans are unloaded, the wheels are replaced, and the vans are tractor-hauled to petitioner's distribution warehouse after clearing customs upon payment of a 4% import duty.
The imported tires, each of which has its own serial number, are packed in bulk into the trailers and vans, without otherwise being packaged or bundled. They lose their identity as a unit, however, when unloaded from the trailers and vans at the distribution warehouse. When unloaded they are sorted by size and style, without segregation by place of manufacture, stacked on wooden pallets each bearing four stacks of five tires of the same size and style, and stored in pallet stacks of three pallets each. This is the only processing required or performed to ready the tires for sale and delivery to the franchised dealers.
Sales of tires and tubes from the Gwinnett County *281 distribution warehouse to the franchised dealers average 4,000-5,000 pounds per sale. Orders are filled without regard to the shipments in which the tires and tubes arrived in the United States or the place of their manufacture. Delivery to the franchised dealers is by common carrier or customer pickup.
II
Both Georgia courts addressed the question whether, without regard to whether the imported tires had lost their character as imports, Georgia's nondiscriminatory ad valorem tax fell within the constitutional prohibition against the laying by States of "any Imposts or Duties on Imports . . . ." The Superior Court expressed strong doubts that the ad valorem tax fell within the prohibition but concluded that it was bound by this Court's decisions to the contrary. The Superior Court stated:
"While it would seem that where said tires and tubes have been placed in [petitioner's] general inventory for the purpose of sale to its customers, . . . such inventory should be taxed to the same extent as any other inventory of any other business in Gwinnett County, and the Court would so hold if supported by the law, it is clear that where the property is imported for resale it retains its import exemption from ad valorem taxes until after such sale," "[for] [t]he immunity of imported goods from local taxation includes immunity from local ad valorem property taxes; Hooven & Allison Company v. Evatt, 324 U.S. 652; Low v. Austin, 80 U.S. 29." Pet. for Cert., App. A-4, A-3.
Similarly, the Georgia Supreme Court stated, 233 Ga., at 722, 214 S.E. 2d. at 355:
"[Petitioners] argue that an annual ad valorem tax is not a tax on imports within the meaning of *282 the federal constitutional provision. We reject this argument on the basis of the above-cited authority. [E. g., Low v. Austin.]"
Low v. Austin, supra, is the leading decision of this Court holding that the States are prohibited by the Import-Export Clause from imposing a nondiscriminatory ad valorem property tax on imported goods until they lose their character as imports and become incorporated into the mass of property in the State. The Court there reviewed a decision of the California Supreme Court that had sustained the constitutionality of California's nondiscriminatory ad valorem tax on the ground that the Import-Export Clause only prohibited taxes upon the character of the goods as imports and therefore did not prohibit nondiscriminatory taxes upon the goods as property. See 13 Wall., at 30-31. This Court reversed on its reading of the seminal opinion construing the Import-Export Clause, Brown v. Maryland, 12 Wheat. 419 (1827), as holding that "[w]hilst retaining their character as imports, a tax upon them, in any shape, is within the constitutional prohibition." 13 Wall., at 34.
Scholarly analysis has been uniformly critical of Low v. Austin. It is true that Mr. Chief Justice Marshall, speaking for the Court in Brown v. Maryland, supra, at 442, said that "while [the thing imported remains] the property of the importer, in his warehouse, in the original form or package in which it was imported, a tax upon it is too plainly a duty on imports to escape the prohibition in the constitution." Commentators have uniformly agreed that Low v. Austin misread this dictum in holding that the Court in Brown included nondiscriminatory ad valorem property taxes among prohibited "imposts" or "duties," for the contrary conclusion is plainly to be inferred from consideration of the specific abuses which led the Framers to include the Import-Export *283 Clause in the Constitution. See, e. g., Powell, State Taxation of ImportsWhen Does an Import Cease to Be an Import?, 58 Harv. L. Rev. 858 (1945); Note, The Supreme Court, 1958 Term, 73 Harv. L. Rev. 126, 176 (1959); Early & Weitzman, A Century of Dissent: The Immunity of Goods Imported for Resale From Non-discriminatory State Personal Property Taxes, 7 Sw. U. L. Rev. 247 (1975); Dakin, The Protective Cloak of the Export-Import Clause: Immunity for the Goods or Immunity for the Process?, 19 La. L. Rev. 747 (1959).
Our independent study persuades us that a nondiscriminatory ad valorem property tax is not the type of state exaction which the Framers of the Constitution or the Court in Brown had in mind as being an "impost" or "duty" and that Low v. Austin's reliance upon the Brown dictum to reach the contrary conclusion was misplaced.
III
One of the major defects of the Articles of Confederation, and a compelling reason for the calling of the Constitutional Convention of 1787, was the fact that the Articles essentially left the individual States free to burden commerce both among themselves and with foreign countries very much as they pleased. Before 1787 it was commonplace for seaboard States with port facilities to derive revenue to defray the costs of state and local governments by imposing taxes on imported goods destined for customers in other States. At the same time, there was no secure source of revenue for the central government. James Madison, in his Preface to Debates in the Convention of 1787, 3 M. Farrand, The Records of the Federal Convention of 1787, p. 542 (1911) (hereafter Farrand), provides a graphic description of the situation:
"The other source of dissatisfaction was the peculiar situation of some of the States, which having no *284 convenient ports for foreign commerce, were subject to be taxed by their neighbors, thro whose ports, their commerce was carried on. New Jersey, placed between Phila. & N. York, was likened to a Cask tapped at both ends: and N. Carolina between Virga. & S. Carolina to a patient bleeding at both Arms. The Articles of Confederation provided no remedy for the complaint: which produced a strong protest on the part of N. Jersey; and never ceased to be a source of dissatisfaction & discord, until the new Constitution, superseded the old."[3]
And further, id., at 546-548:
"Rh. I. was the only exception to a compliance with the recommendation from Annapolis [to have a Const. Convention], well known to have been swayed by an obdurate adherence to an advantage which her position gave her of taxing her neighbors thro' their consumption of imported supplies, an advantage which it was foreseen would be taken from her by a revisal of the Articles of Confederation.
.....
"The same want of a general power over Commerce *285 led to an exercise of this power separately, by the States, wch not only proved abortive, but engendered rival, conflicting and angry regulations. Besides the vain attempts to supply their respective treasuries by imposts, which turned their commerce into the neighboring ports, and to co-erce a relaxation of the British monopoly of the W. Indn. navigation, which was attempted by Virga. . . . the States having ports for foreign commerce, taxed & irritated the adjoining States, trading thro' them, as N. Y. Pena. Virga. & S-Carolina."
The Framers of the Constitution thus sought to alleviate three main concerns by committing sole power to lay imposts and duties on imports in the Federal Government, with no concurrent state power: the Federal Government must speak with one voice when regulating commercial relations with foreign governments, and tariffs, which might affect foreign relations, could not be implemented by the States consistently with that exclusive power;[4] import revenues were to be the major source of revenue of the Federal Government and should not be diverted to the States;[5] and harmony among the States might be disturbed unless seaboard States, with their crucial ports of entry, were prohibited from levying taxes on citizens of other States by taxing goods merely *286 flowing through their ports to the other States not situated as favorably geographically.[6]
Nothing in the history of the Import-Export Clause even remotely suggests that a nondiscriminatory ad valorem property tax which is also imposed on imported goods that are no longer in import transit was the type of exaction that was regarded as objectionable by the Framers of the Constitution. For such an exaction, unlike discriminatory state taxation against imported goods as imports, was not regarded as an impediment that severely hampered commerce or constituted a form of tribute by seaboard States to the disadvantage of the other States.
It is obvious that such nondiscriminatory property taxation can have no impact whatsoever on the Federal Government's exclusive regulation of foreign commerce, probably the most important purpose of the Clause's prohibition. By definition, such a tax does not fall on imports as such because of their place of origin. It cannot be used to create special protective tariffs or particular preferences for certain domestic goods, and it cannot be applied selectively to encourage or discourage any importation in a manner inconsistent with federal regulation.
Nor will such taxation deprive the Federal Government of the exclusive right to all revenues from imposts and duties on imports and exports, since that right by definition only extends to revenues from exactions of a particular category: if nondiscriminatory ad valorem taxation is not in that category, it deprives the Federal *287 Government of nothing to which it is entitled. Unlike imposts and duties, which are essentially taxes on the commercial privilege of bringing goods into a country, such property taxes are taxes by which a State apportions the cost of such services as police and fire protection among the beneficiaries according to their respective wealth; there is no reason why an importer should not bear his share of these costs along with his competitors handling only domestic goods. The Import-Export Clause clearly prohibits state taxation based on the foreign origin of the imported goods, but it cannot be read to accord imported goods preferential treatment that permits escape from uniform taxes imposed without regard to foreign origin for services which the State supplies. See, e. g., May v. New Orleans, 178 U.S. 496, 502-504, 507-509 (1900). It may be that such taxation could diminish federal impost revenues to the extent its economic burden may discourage purchase or importation of foreign goods. The prevention or avoidance of this incidental effect was not, however, even remotely an objective of the Framers in enacting the prohibition. Certainly the Court in Brown did not think so. See 12 Wheat., at 443-444. Taxes imposed after an initial sale, after the breakup of the shipping packages, or the moment goods imported for use are committed to current operational needs are also all likely to have an incidental effect on the volume of goods imported; yet all are permissible. See, e. g., Waring v. The Mayor, 8 Wall. 110 (1869) (taxation after initial sale); May v. New Orleans, supra (taxation after breakup of shipping packages); Youngstown Sheet & Tube Co. v. Bowers, 358 U.S. 534 (1959) (taxation of goods committed to current operational needs by manufacturer). What those taxes and nondiscriminatory ad valorem property taxes share, it should be emphasized, is *288 the characteristic that they cannot be selectively imposed and increased so as substantially to impair or prohibit importation.[7]
Finally, nondiscriminatory ad valorem property taxes do not interfere with the free flow of imported goods among the States, as did the exactions by States under the Articles of Confederation directed solely at imported goods. Indeed, importers of goods destined for inland States can easily avoid even those taxes in today's world. Modern transportation methods such as air freight and containerized packaging, and the development of railroads and the Nation's internal waterways, enable importation directly into the inland States. Petitioner, for example, operates other distribution centers from wholesale warehouses in inland States. Actually, a quarter of the tires distributed from petitioner's Georgia warehouse are imported interstate directly from Canada. To be sure, allowance of nondiscriminatory ad valorem property taxation may increase the cost of goods purchased by "inland" consumers.[8] But as already noted, *289 such taxation is the quid pro quo for benefits actually conferred by the taxing State. There is no reason why local taxpayers should subsidize the services used by the importer; ultimate consumers should pay for such services as police and fire protection accorded the goods just as much as they should pay transportation costs associated with those goods.[9] An evil to be prevented *290 by the Import-Export Clause was the levying of taxes which could only be imposed because of the peculiar geographical situation of certain States that enabled them to single out goods destined for other States. In effect, the Clause was fashioned to prevent the imposition of exactions which were no more than transit fees on the privilege of moving through a State.[10] A nondiscriminatory ad valorem property tax obviously stands on a different footing, and to the extent there is any conflict whatsoever with this purpose of the Clause, it may be secured merely by prohibiting the assessment of even nondiscriminatory property taxes on goods which are merely in transit through the State when the tax is assessed.[11]
Admittedly, the wording of the prohibition of the Import-Export Clause does not in terms except nondiscriminatory taxes with some impact on imports or exports. But just as clearly, the Clause is not written in terms of a broad prohibition of every "tax." The prohibition is only against States laying "Imposts or Duties" on "Imports." By contrast, Congress is empowered to "lay and collect Taxes, Duties, Imposts, and Excises," which plainly lends support to a reading of the Import-Export Clause as not prohibiting every exaction or "tax" which falls in some measure on imported goods. Indeed, Professor Crosskey makes a persuasive demonstration *291 that the words "imposts" and "duties" as used in 1787 had meanings well understood to be exactions upon imported goods as imports. "Imposts" were like customs duties, that is, charges levied on imports at the time and place of importation. "Duties" was a broader term embracing excises as well as customs duties, and probably only capitation, land, and general property exactions were known by the term "tax" rather than the term "duty." 1 W. Crosskey, Politics and the Constitution in the History of the United States 296-297 (1953).[12] The characteristic common to both "imposts" *292 and "duties" was that they were exactions directed at imports or commercial activity as such and, as imposed by the seaboard States under the Articles of Confederation, *293 were purposefully employed to regulate interstate and foreign commerce and tax States situated less favorably geographically.
In any event, since prohibition of nondiscriminatory ad valorem property taxation would not further the objectives of the Import-Export Clause, only the clearest constitutional mandate should lead us to condemn such taxation. The terminology employed in the Clause "Imposts or Duties"is sufficiently ambiguous that we decline to presume it was intended to embrace taxation *294 that does not create the evils the Clause was specifically intended to eliminate.
IV
The Court in Low v. Austin nevertheless expanded the prohibition of the Clause to include nondiscriminatory ad valorem property taxes, and did so with no analysis, but with only the statement that Brown v. Maryland had marked the line "where the power of Congress over the goods imported ends, and that of the State begins, with as much precision as the subject admits." 13 Wall., at 32. But the opinion in Brown v. Maryland cannot properly be read to propose such a broad definition of "imposts" or "duties." The tax there held to be prohibited by the Import-Export Clause was imposed under a Maryland statute that required importers of foreign goods, and wholesalers selling the same by bale or package, to obtain a license and pay a $50 fee therefor, subject to certain forfeitures and penalties for noncompliance. The importers contested the validity of the statute, arguing that the license was a "palpable evasion" of the Import-Export Clause because it was essentially equivalent to a duty on imports. They contended that asserted differences between the license fee and a tax directly imposed on imports were more formal than substantial: the privilege of bringing the goods into the country could not realistically be divorced from the privilege of selling the goods, since the power to prohibit sale would be the power to prohibit importation, 12 Wheat., at 422; the payment of the tax at the time of sale rather than at the time of importation would be irrelevant since it would still be a tax on the same privilege at either time, id., at 423; and the fact that a license operates on the person of the importer while the duty operates on the goods themselves is irrelevant in that either levy would directly increase the cost of the goods, ibid. Since the *295 power to impose a license on importers would also entail a power to price them out of the market or prohibit them entirely, the importers concluded that such a power must be repugnant to the exclusive federal power to regulate foreign commerce, id., at 423-425.
The Attorney General of Maryland, Roger Taney, later Chief Justice, defended the constitutionality of Maryland's law. He argued that the fee was not a prohibited "impost" or "duty" because the license fee was not a tax upon the imported goods, but on the importers, a tax upon the occupation and nothing more, and the Import-Export Clause prohibited only exactions on the right of importation and not an exaction upon the occupation of importers. He contended that, in any event, the Clause, if not read as prohibiting only exactions on the right of importation, but, more broadly, as also prohibiting exactions on goods imported, would necessarily immunize imports from all state taxation at any time. Moreover, if the privilege of selling is a concomitant of the privilege of importing, the argument proved too much; the importer could sell free of regulation by the States in any place and in any manner, even importing free of regulations concerning the bringing of noxious goods into the city, or auctioning the goods in public warehouses, or selling at retail or as a traveling peddler, activities that had traditionally been subject to state regulation and taxation.
The Court in Brown refused to define "imposts" or "duties" comprehensively, since the Maryland statute presented only the question "whether the legislature of a State can constitutionally require the importer of foreign articles to take out a license from the State, before he shall be permitted to sell a bale or package so imported." 12 Wheat., at 436. However, in holding that the Maryland license fee was within prohibited "imposts, *296 or duties on imports . . ." the Court significantly characterized an impost or duty as "a custom or a tax levied on articles brought into a country," id., at 437, although also holding that, while normally levied before the articles are permitted to enter, the exactions are no less within the prohibition if levied upon the goods as imports after entry; since "imports" are the goods imported, the prohibition of imposts or duties on "imports" was more than a prohibition of a tax on the act of importation; it "extends to a duty levied after [the thing imported] has entered the country," id., at 438. And since the power to prohibit sale of an article is the power to prohibit its introduction into the country, the privilege of sale must be a concomitant of the privilege of importation, and licenses on the right to sell must therefore also fall within the constitutional prohibition. Id., at 439.
Taney's argument was persuasive, however, to the extent that the Court was prompted to declare that "the words of the prohibition ought not to be pressed to their utmost extent; . . . in our complex system, the object of the powers conferred on the government of the Union, and the nature of the often conflicting powers which remain in the States, must always be taken into view . . . . [T]here must be a point of time when the prohibition ceases, and the power of the State to tax commences. . . ." Id., at 441.
The Court stated that there were two situations in which the prohibition would not apply. One was the case of a state tax levied after the imported goods had lost their status as imports. The Court devised an evidentiary tool, the "original package" test, for use in making that determination. The formula was: "It is sufficient for the present to say, generally, that when the importer has so acted upon the thing imported, *297 that it has become incorporated and mixed up with the mass of property in the country, it has, perhaps, lost its distinctive character as an import, and has become subject to the taxing power of the State; but while remaining the property of the importer, in his warehouse, in the original form or package in which it was imported, a tax upon it is too plainly a duty on imports to escape the prohibition in the constitution." Id., at 441-442. "It is a matter of hornbook knowledge that the original package statement of Justice Marshall was an illustration, rather than a formula, and that its application is evidentiary, and not substantive . . . ." Galveston v. Mexican Petroleum Corp., 15 F.2d 208 (SD Tex. 1926).
The other was the situation of particular significance to our decision of this case, that is, when the particular state exaction is not a prohibited "impost" or "duty." The Court first stated its view of the characteristics of prohibited state levies. It said that the obvious clue was the express exception of the Import-Export Clause authorizing "imposts or duties" that "may be absolutely necessary for executing [the State's] inspection Laws." "[T]his exception," said the Court, "in favor of duties for the support of inspection laws, goes far in proving that the framers of the constitution classed taxes of a similar character with those imposed for the purposes of inspection, with duties on imports and exports, and supposed them to be prohibited." 12 Wheat., at 438 (emphasis supplied). The characteristic of the prohibited levy, the Court said later in the opinionillustrated by the Maryland license taxwas that "the tax intercepts the import, as an import, in its way to become incorporated with the general mass of property, and denies it the privilege of becoming so incorporated until it shall have contributed to the revenue of the State." Id., at 443 (emphasis *298 supplied). The Court illustrated the kinds of state exactions that in its view fell without the prohibition as examples of neutral and nondiscriminatory taxation: a tax on itinerant peddlers, a service charge for the use of a public auctioneer, a property tax on plate or furniture personally used by the importer. These could not be considered within the constitutional prohibition because they were imposed without regard to the origin of the goods taxed. Id., at 443, 444. In contrast, the Maryland exaction in question was a license fee which singled out imports, and therefore was prohibited because "the tax intercepts the import, as an import, in its way to become incorporated with the general mass of property." Id., at 443. (Emphasis supplied.)
Thus, it is clear that the Court's view in Brown was that merely because certain actions taken by the importer on his imported goods would so mingle them with the common property within the State as to "lose their distinctive character as imports" and render them subject to the taxing power of the State, did not mean that in the absence of such action, no exaction could be imposed on the goods. Rather, the Court clearly implied that the prohibition would not apply to a state tax that treated imported goods in their original packages no differently from the "common mass of property in the country"; that is, treated it in a manner that did not depend on the foreign origins of the goods.
Despite the language and objectives of the Import-Export Clause, and despite the limited nature of the holding in Brown v. Maryland, the Court in Low v. Austin ignored the warning that the boundary between the power of States to tax persons and property within their jurisdictions and the limitations on the power of the States to impose imposts or duties with respect to "imports" was a subtle and difficult line which *299 must be drawn as the cases arise. Low v. Austin also ignored the cautionary remark that; for those reasons, it "might be premature to state any rule as being universal in its application." 12 Wheat., at 441. Although it was "sufficient" in the context of Maryland's license tax on the right to sell imported goods to note that a tax imposed directly on imported goods which have not been acted upon in any way would clearly fall within the constitutional prohibition, that observation did not apply, as the foregoing analysis indicates, to a state tax which treated those same goods without regard to the fact of their foreign origin.
Low v. Austin compounded the error in misreading the Brown opinion by the further error of misreading the views of Mr. Chief Justice Taney as expressed in his opinion in the License Cases, 5 How. 504 (1847) (six Justices wrote separately in the cases). As already observed, when the Chief Justice was Attorney General of Maryland he argued Brown v. Maryland for the State. He had argued that the Maryland license fee requirement fell upon the importer, not the imported goods, and therefore fell without the Import-Export Clause's prohibition against imposts or duties on "imports." In the License Cases he observed that "further and more mature reflection has convinced me that the rule laid down [in Brown v. Maryland] is a just and safe one, and perhaps the best that could have been adopted for preserving the right of the United States on the one hand, and of the States on the other, and preventing collision between them. The question, I have already said, was a very difficult one for the judicial mind. In the nature of things, the line of division is in some degree vague and indefinite, and I do not see how it could be drawn more accurately and correctly, or more in harmony with the obvious intention and object of this provision in the *300 constitution. Indeed, goods imported, while they remain in the hands of the importer, in the form and shape in which they were brought into the country, can in no just sense be regarded as a part of that mass of property in the State usually taxed for the support of the State government." 5 How., at 575.
Low v. Austin quoted this excerpt, 13 Wall., at 33-34, as supporting the holding, id., at 34, that "a tax upon [imported goods], in any shape, is within the constitutional prohibition." But Mr. Chief Justice Taney said much more in his opinion in the License Cases, and what he said further makes crystal clear that the prohibition applied only to state exactions upon imports as imports and did not apply to nondiscriminatory ad valorem property taxes. For, continuing his analysis in the very paragraph from which Low v. Austin excerpted only a part, he concluded: "A tax in any shape . . . cannot be done directly, in the shape of a duty on imports, for that is expressly prohibited. And as it cannot be done directly, it could hardly be a just and sound construction of the constitution which would enable a State to accomplish precisely the same thing under another name, and in a different form." 5 How., at 576 (emphasis supplied). The Chief Justice then went on to distinguish an exaction upon imports as imports from property taxes indiscriminately applied to all owners of property, stating, ibid.:
"Undoubtedly a State may impose a tax upon its citizens in proportion to the amount they are respectively worth; and the importing merchant is liable to this assessment like any other citizen, and is chargeable according to the amount of his property, whether it consists of money engaged in trade, or of imported goods which he proposes to sell, or any other property of which he is the owner. *301 But a tax of this description stands upon a very different footing from a tax on the thing imported, while it remains a part of foreign commerce, and is not introduced into the general mass of property in the State." (Emphasis supplied.)
Thus Mr. Chief Justice Taney's opinion is authority, precisely contrary to the reading of Low v. Austin, that nondiscriminatory ad valorem property taxes are not prohibited by the Import-Export Clause.
It follows from the foregoing that Low v. Austin was wrongly decided. That decision therefore must be, and is, overruled.[13]
*302 V
Petitioner's tires in this case were no longer in transit. They were stored in a distribution warehouse from which petitioner conducted a wholesale operation, taking orders from franchised dealers and filling them from a constantly replenished inventory. The warehouse was operated no differently than would be a distribution warehouse utilized by a wholesaler dealing solely in domestic goods, and we therefore hold that the non-discriminatory property tax levied on petitioner's inventory of imported tires was not interdicted by the Import-Export Clause of the Constitution. The judgment of the Supreme Court of Georgia is accordingly
Affirmed.
MR. JUSTICE STEVENS took no part in the consideration or decision of this case.
MR. JUSTICE WHITE, concurring in the judgment. | Respondents, the Tax Commissioner and Tax Assessors of Gwinnett County, Ga., assessed ad valorem property taxes against tires and tubes imported by petitioner from France and Nova Scotia that were included on the assessment dates in an inventory maintained at its wholesale distribution warehouse in the county. Petitioner brought this action for declaratory and injunctive relief in the Superior Court of Gwinnett County, alleging that with the exception of certain passenger tubes that had been removed from the original shipping cartons,[1] the ad valorem property taxes assessed against *279 its inventory of imported tires and tubes were prohibited by Art. I, 10, cl. 2, of the Constitution, which provides in pertinent part: "No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws" After trial, the Superior Court granted the requested declaratory and injunctive relief. On appeal, the Supreme Court of Georgia affirmed in part and reversed in part, agreeing that the tubes in the corrugated shipping cartons were immune from ad valorem taxation, but holding that the tires had lost their status as imports and had become subject to such taxation because they had been mingled with other tires imported in bulk, sorted, and arranged for sale. We granted certiorari, The only question presented is whether the Georgia Supreme Court was correct in holding that the tires were subject to the ad valorem property tax.[2] We affirm without addressing the question whether the Georgia Supreme Court was correct in holding that the tires had lost their status as imports. We hold that, in any event, Georgia's assessment of a nondiscriminatory ad valorem property tax against the imported tires is not within the constitutional prohibition against laying "any Imposts or Duties on Imports." and that insofar as is to the contrary, that decision is overruled. I Petitioner, a New York corporation qualified to do business in Georgia, operates as an importer and wholesale *280 distributor in the United States of automobile and truck tires and tubes manufactured in France and Nova Scotia by Michelin Tires, Ltd. The business is operated from distribution warehouses in various parts of the country. Distribution and sale of tires and tubes from the Gwinnett County warehouse is limited to the 250-300 franchised dealers with whom petitioner does all of its business in six southeastern States. Some 25% of the tires and tubes are manufactured in and imported from Nova Scotia, and are brought to the United States in tractor-driven, over-the-road trailers packed and sealed at the Nova Scotia factory. The remaining 75% of the imported tires and tubes are brought to the United States by sea from France and Nova Scotia in sea vans packed and sealed at the foreign factories. Sea vans are essentially over-the-road trailers from which the wheels are removed before being loaded aboard ship. Upon arrival of the ship at the United States port of entry, the vans are unloaded, the wheels are replaced, and the vans are tractor-hauled to petitioner's distribution warehouse after clearing customs upon payment of a 4% import duty. The imported tires, each of which has its own serial number, are packed in bulk into the trailers and vans, without otherwise being packaged or bundled. They lose their identity as a unit, however, when unloaded from the trailers and vans at the distribution warehouse. When unloaded they are sorted by size and style, without segregation by place of manufacture, stacked on wooden pallets each bearing four stacks of five tires of the same size and style, and stored in pallet stacks of three pallets each. This is the only processing required or performed to ready the tires for sale and delivery to the franchised dealers. Sales of tires and tubes from the Gwinnett County *281 distribution warehouse to the franchised dealers average 4,000-5,000 pounds per sale. Orders are filled without regard to the shipments in which the tires and tubes arrived in the United States or the place of their manufacture. Delivery to the franchised dealers is by common carrier or customer pickup. II Both Georgia courts addressed the question whether, without regard to whether the imported tires had lost their character as imports, Georgia's nondiscriminatory ad valorem tax fell within the constitutional prohibition against the laying by States of "any Imposts or Duties on Imports" The Superior Court expressed strong doubts that the ad valorem tax fell within the prohibition but concluded that it was bound by this Court's decisions to the contrary. The Superior Court : "While it would seem that where said tires and tubes have been placed in [petitioner's] general inventory for the purpose of sale to its customers, such inventory should be taxed to the same extent as any other inventory of any other business in Gwinnett County, and the Court would so hold if supported by the law, it is clear that where the property is imported for resale it retains its import exemption from ad valorem taxes until after such sale," "[for] [t]he immunity of imported goods from local taxation includes immunity from local ad valorem property taxes; Hooven & Allison ;" Pet. for Cert., App. A-4, A-3. Similarly, the Georgia Supreme Court 214 S.E. 2d. at 355: "[Petitioners] argue that an annual ad valorem tax is not a tax on imports within the meaning of *282 the federal constitutional provision. We reject this argument on the basis of the above-cited authority. [E. g.,]" is the leading decision of this Court holding that the States are prohibited by the Import-Export Clause from imposing a nondiscriminatory ad valorem property tax on imported goods until they lose their character as imports and become incorporated into the mass of property in the State. The Court there reviewed a decision of the California Supreme Court that had sustained the constitutionality of California's nondiscriminatory ad valorem tax on the ground that the Import-Export Clause only prohibited taxes upon the character of the goods as imports and therefore did not prohibit nondiscriminatory taxes upon the goods as property. See -31. This Court reversed on its reading of the seminal opinion construing the Import-Export Clause, as holding that "[w]hilst retaining their character as imports, a tax upon them, in any shape, is within the constitutional prohibition." Scholarly analysis has been uniformly critical of It is true that Mr. Chief Justice Marshall, speaking for the Court in said that "while [the thing imported remains] the property of the importer, in his warehouse, in the original form or package in which it was imported, a tax upon it is too plainly a duty on imports to escape the prohibition in the constitution." Commentators have uniformly agreed that misread this dictum in holding that the Court in Brown included nondiscriminatory ad valorem property taxes among prohibited "imposts" or "duties," for the contrary conclusion is plainly to be inferred from consideration of the specific abuses which led the Framers to include the Import-Export *283 Clause in the Constitution. See, e. g., Powell, State Taxation of ImportsWhen Does an Import Cease to Be an Import?, ; Note, The Supreme Court, 1958 Term, ; Early & Weitzman, A Century of Dissent: The Immunity of Goods Imported for Resale From Non-discriminatory State Personal Property Taxes, ; Dakin, The Protective Cloak of the Export-Import Clause: Immunity for the Goods or Immunity for the Process?, Our independent study persuades us that a nondiscriminatory ad valorem property tax is not the type of state exaction which the Framers of the Constitution or the Court in Brown had in mind as being an "impost" or "duty" and that 's reliance upon the Brown dictum to reach the contrary conclusion was misplaced. III One of the major defects of the Articles of Confederation, and a compelling reason for the calling of the Constitutional Convention of 1787, was the fact that the Articles essentially left the individual States free to burden commerce both among themselves and with foreign countries very much as they pleased. Before 1787 it was commonplace for seaboard States with port facilities to derive revenue to defray the costs of state and local governments by imposing taxes on imported goods destined for customers in other States. At the same time, there was no secure source of revenue for the central government. James Madison, in his Preface to Debates in the Convention of 1787, 3 M. Farrand, The Records of the Federal Convention of 1787, p. 542 (1911) (hereafter Farrand), provides a graphic description of the situation: "The other source of dissatisfaction was the peculiar situation of some of the States, which having no *284 convenient ports for foreign commerce, were subject to be taxed by their neighbors, thro whose ports, their commerce was carried on. New Jersey, placed between Phila. & N. York, was likened to a Cask tapped at both ends: and N. Carolina between Virga. & S. Carolina to a patient bleeding at both Arms. The Articles of Confederation provided no remedy for the complaint: which produced a strong protest on the part of N. Jersey; and never ceased to be a source of dissatisfaction & discord, until the new Constitution, superseded the old."[3] And further, at 546-548: "Rh. I. was the only exception to a compliance with the recommendation from Annapolis [to have a Const. Convention], well known to have been swayed by an obdurate adherence to an advantage which her position gave her of taxing her neighbors thro' their consumption of imported supplies, an advantage which it was foreseen would be taken from her by a revisal of the Articles of Confederation. "The same want of a general power over Commerce *285 led to an exercise of this power separately, by the States, wch not only proved abortive, but engendered rival, conflicting and angry regulations. Besides the vain attempts to supply their respective treasuries by imposts, which turned their commerce into the neighboring ports, and to co-erce a relaxation of the British monopoly of the W. Indn. navigation, which was attempted by Virga. the States having ports for foreign commerce, taxed & irritated the adjoining States, trading thro' them, as N. Y. Pena. Virga. & S-Carolina." The Framers of the Constitution thus sought to alleviate three main concerns by committing sole power to lay imposts and duties on imports in the Federal Government, with no concurrent state power: the Federal Government must speak with one voice when regulating commercial relations with foreign governments, and tariffs, which might affect foreign relations, could not be implemented by the States consistently with that exclusive power;[4] import revenues were to be the major source of revenue of the Federal Government and should not be diverted to the States;[5] and harmony among the States might be disturbed unless seaboard States, with their crucial ports of entry, were prohibited from levying taxes on citizens of other States by taxing goods merely *286 flowing through their ports to the other States not situated as favorably geographically.[6] Nothing in the history of the Import-Export Clause even remotely suggests that a nondiscriminatory ad valorem property tax which is also imposed on imported goods that are no longer in import transit was the type of exaction that was regarded as objectionable by the Framers of the Constitution. For such an exaction, unlike discriminatory state taxation against imported goods as imports, was not regarded as an impediment that severely hampered commerce or constituted a form of tribute by seaboard States to the disadvantage of the other States. It is obvious that such nondiscriminatory property taxation can have no impact whatsoever on the Federal Government's exclusive regulation of foreign commerce, probably the most important purpose of the Clause's prohibition. By definition, such a tax does not fall on imports as such because of their place of origin. It cannot be used to create special protective tariffs or particular preferences for certain domestic goods, and it cannot be applied selectively to encourage or discourage any importation in a manner inconsistent with federal regulation. Nor will such taxation deprive the Federal Government of the exclusive right to all revenues from imposts and duties on imports and exports, since that right by definition only extends to revenues from exactions of a particular category: if nondiscriminatory ad valorem taxation is not in that category, it deprives the Federal *287 Government of nothing to which it is entitled. Unlike imposts and duties, which are essentially taxes on the commercial privilege of bringing goods into a country, such property taxes are taxes by which a State apportions the cost of such services as police and fire protection among the beneficiaries according to their respective wealth; there is no reason why an importer should not bear his share of these costs along with his competitors handling only domestic goods. The Import-Export Clause clearly prohibits state taxation based on the foreign origin of the imported goods, but it cannot be read to accord imported goods preferential treatment that permits escape from uniform taxes imposed without regard to foreign origin for services which the State supplies. See, e. g., It may be that such taxation could diminish federal impost revenues to the extent its economic burden may discourage purchase or importation of foreign goods. The prevention or avoidance of this incidental effect was not, however, even remotely an objective of the Framers in enacting the prohibition. Certainly the Court in Brown did not think so. See -444. Taxes imposed after an initial sale, after the breakup of the shipping packages, or the moment goods imported for use are committed to current operational needs are also all likely to have an incidental effect on the volume of goods imported; yet all are permissible. See, e. g., ; ; Youngstown Sheet & Tube What those taxes and nondiscriminatory ad valorem property taxes share, it should be emphasized, is *288 the characteristic that they cannot be selectively imposed and increased so as substantially to impair or prohibit importation.[7] Finally, nondiscriminatory ad valorem property taxes do not interfere with the free flow of imported goods among the States, as did the exactions by States under the Articles of Confederation directed solely at imported goods. Indeed, importers of goods destined for inland States can easily avoid even those taxes in today's world. Modern transportation methods such as air freight and containerized packaging, and the development of railroads and the Nation's internal waterways, enable importation directly into the inland States. Petitioner, for example, operates other distribution centers from wholesale warehouses in inland States. Actually, a quarter of the tires distributed from petitioner's Georgia warehouse are imported interstate directly from Canada. To be sure, allowance of nondiscriminatory ad valorem property taxation may increase the cost of goods purchased by "inland" consumers.[8] But as already noted, *289 such taxation is the quid pro quo for benefits actually conferred by the taxing State. There is no reason why local taxpayers should subsidize the services used by the importer; ultimate consumers should pay for such services as police and fire protection accorded the goods just as much as they should pay transportation costs associated with those goods.[9] An evil to be prevented *290 by the Import-Export Clause was the levying of taxes which could only be imposed because of the peculiar geographical situation of certain States that enabled them to single out goods destined for other States. In effect, the Clause was fashioned to prevent the imposition of exactions which were no more than transit fees on the privilege of moving through a State.[10] A nondiscriminatory ad valorem property tax obviously stands on a different footing, and to the extent there is any conflict whatsoever with this purpose of the Clause, it may be secured merely by prohibiting the assessment of even nondiscriminatory property taxes on goods which are merely in transit through the State when the tax is assessed.[11] Admittedly, the wording of the prohibition of the Import-Export Clause does not in terms except nondiscriminatory taxes with some impact on imports or exports. But just as clearly, the Clause is not written in terms of a broad prohibition of every "tax." The prohibition is only against States laying "Imposts or Duties" on "Imports." By contrast, Congress is empowered to "lay and collect Taxes, Duties, Imposts, and Excises," which plainly lends support to a reading of the Import-Export Clause as not prohibiting every exaction or "tax" which falls in some measure on imported goods. Indeed, Professor Crosskey makes a persuasive demonstration *291 that the words "imposts" and "duties" as used in 1787 had meanings well understood to be exactions upon imported goods as imports. "Imposts" were like customs duties, that is, charges levied on imports at the time and place of importation. "Duties" was a broader term embracing excises as well as customs duties, and probably only capitation, land, and general property exactions were known by the term "tax" rather than the term "duty." 1 W. Crosskey, Politics and the Constitution in the History of the United States 296-297 (1953).[12] The characteristic common to both "imposts" *292 and "duties" was that they were exactions directed at imports or commercial activity as such and, as imposed by the seaboard States under the Articles of Confederation, *293 were purposefully employed to regulate interstate and foreign commerce and tax States situated less favorably geographically. In any event, since prohibition of nondiscriminatory ad valorem property taxation would not further the objectives of the Import-Export Clause, only the clearest constitutional mandate should lead us to condemn such taxation. The terminology employed in the Clause "Imposts or Duties"is sufficiently ambiguous that we decline to presume it was intended to embrace taxation *294 that does not create the evils the Clause was specifically intended to eliminate. IV The Court in nevertheless expanded the prohibition of the Clause to include nondiscriminatory ad valorem property taxes, and did so with no analysis, but with only the statement that had marked the line "where the power of Congress over the goods imported ends, and that of the State begins, with as much precision as the subject admits." But the opinion in cannot properly be read to propose such a broad definition of "imposts" or "duties." The tax there held to be prohibited by the Import-Export Clause was imposed under a statute that required importers of foreign goods, and wholesalers selling the same by bale or package, to obtain a license and pay a $50 fee therefor, subject to certain forfeitures and penalties for noncompliance. The importers contested the validity of the statute, arguing that the license was a "palpable evasion" of the Import-Export Clause because it was essentially equivalent to a duty on imports. They contended that asserted differences between the license fee and a tax directly imposed on imports were more formal than substantial: the privilege of bringing the goods into the country could not realistically be divorced from the privilege of selling the goods, since the power to prohibit sale would be the power to prohibit importation, ; the payment of the tax at the time of sale rather than at the time of importation would be irrelevant since it would still be a tax on the same privilege at either time, ; and the fact that a license operates on the person of the importer while the duty operates on the goods themselves is irrelevant in that either levy would directly increase the cost of the goods, Since the *295 power to impose a license on importers would also entail a power to price them out of the market or prohibit them entirely, the importers concluded that such a power must be repugnant to the exclusive federal power to regulate foreign commerce, -425. The Attorney General of Roger Taney, later Chief Justice, defended the constitutionality of 's law. He argued that the fee was not a prohibited "impost" or "duty" because the license fee was not a tax upon the imported goods, but on the importers, a tax upon the occupation and nothing more, and the Import-Export Clause prohibited only exactions on the right of importation and not an exaction upon the occupation of importers. He contended that, in any event, the Clause, if not read as prohibiting only exactions on the right of importation, but, more broadly, as also prohibiting exactions on goods imported, would necessarily immunize imports from all state taxation at any time. Moreover, if the privilege of selling is a concomitant of the privilege of importing, the argument proved too much; the importer could sell free of regulation by the States in any place and in any manner, even importing free of regulations concerning the bringing of noxious goods into the city, or auctioning the goods in public warehouses, or selling at retail or as a traveling peddler, activities that had traditionally been subject to state regulation and taxation. The Court in Brown refused to define "imposts" or "duties" comprehensively, since the statute presented only the question "whether the legislature of a State can constitutionally require the importer of foreign articles to take out a license from the State, before he shall be permitted to sell a bale or package so imported." However, in holding that the license fee was within prohibited "imposts, *296 or duties on imports" the Court significantly characterized an impost or duty as "a custom or a tax levied on articles brought into a country," although also holding that, while normally levied before the articles are permitted to enter, the exactions are no less within the prohibition if levied upon the goods as imports after entry; since "imports" are the goods imported, the prohibition of imposts or duties on "imports" was more than a prohibition of a tax on the act of importation; it "extends to a duty levied after [the thing imported] has entered the country," And since the power to prohibit sale of an article is the power to prohibit its introduction into the country, the privilege of sale must be a concomitant of the privilege of importation, and licenses on the right to sell must therefore also fall within the constitutional prohibition. Taney's argument was persuasive, however, to the extent that the Court was prompted to declare that "the words of the prohibition ought not to be pressed to their utmost extent; in our complex system, the object of the powers conferred on the government of the Union, and the nature of the often conflicting powers which remain in the States, must always be taken into view [T]here must be a point of time when the prohibition ceases, and the power of the State to tax commences." The Court that there were two situations in which the prohibition would not apply. One was the case of a state tax levied after the imported goods had lost their status as imports. The Court devised an evidentiary tool, the "original package" test, for use in making that determination. The formula was: "It is sufficient for the present to say, generally, that when the importer has so acted upon the thing imported, *297 that it has become incorporated and mixed up with the mass of property in the country, it has, perhaps, lost its distinctive character as an import, and has become subject to the taxing power of the State; but while remaining the property of the importer, in his warehouse, in the original form or package in which it was imported, a tax upon it is too plainly a duty on imports to escape the prohibition in the constitution." -442. "It is a matter of hornbook knowledge that the original package statement of Justice Marshall was an illustration, rather than a formula, and that its application is evidentiary, and not substantive" The other was the situation of particular significance to our decision of this case, that is, when the particular state exaction is not a prohibited "impost" or "duty." The Court first its view of the characteristics of prohibited state levies. It said that the obvious clue was the express exception of the Import-Export Clause authorizing "imposts or duties" that "may be absolutely necessary for executing [the State's] inspection Laws." "[T]his exception," said the Court, "in favor of duties for the support of inspection laws, goes far in proving that the framers of the constitution classed taxes of a similar character with those imposed for the purposes of inspection, with duties on imports and exports, and supposed them to be prohibited." 12 Wheat., The characteristic of the prohibited levy, the Court said later in the opinionillustrated by the license taxwas that "the tax intercepts the import, as an import, in its way to become incorporated with the general mass of property, and denies it the privilege of becoming so incorporated until it shall have contributed to the revenue of the State." The Court illustrated the kinds of state exactions that in its view fell without the prohibition as examples of neutral and nondiscriminatory taxation: a tax on itinerant peddlers, a service charge for the use of a public auctioneer, a property tax on plate or furniture personally used by the importer. These could not be considered within the constitutional prohibition because they were imposed without regard to the origin of the goods taxed. 444. In contrast, the exaction in question was a license fee which singled out imports, and therefore was prohibited because "the tax intercepts the import, as an import, in its way to become incorporated with the general mass of property." (Emphasis supplied.) Thus, it is clear that the Court's view in Brown was that merely because certain actions taken by the importer on his imported goods would so mingle them with the common property within the State as to "lose their distinctive character as imports" and render them subject to the taxing power of the State, did not mean that in the absence of such action, no exaction could be imposed on the goods. Rather, the Court clearly implied that the prohibition would not apply to a state tax that treated imported goods in their original packages no differently from the "common mass of property in the country"; that is, treated it in a manner that did not depend on the foreign origins of the goods. Despite the language and objectives of the Import-Export Clause, and despite the limited nature of the holding in the Court in ignored the warning that the boundary between the power of States to tax persons and property within their jurisdictions and the limitations on the power of the States to impose imposts or duties with respect to "imports" was a subtle and difficult line which *299 must be drawn as the cases arise. also ignored the cautionary remark that; for those reasons, it "might be premature to state any rule as being universal in its application." 12 Wheat., Although it was "sufficient" in the context of 's license tax on the right to sell imported goods to note that a tax imposed directly on imported goods which have not been acted upon in any way would clearly fall within the constitutional prohibition, that observation did not apply, as the foregoing analysis indicates, to a state tax which treated those same goods without regard to the fact of their foreign origin. compounded the error in misreading the Brown opinion by the further error of misreading the views of Mr. Chief Justice Taney as expressed in his opinion in the License Cases, As already observed, when the Chief Justice was Attorney General of he argued for the State. He had argued that the license fee requirement fell upon the importer, not the imported goods, and therefore fell without the Import-Export Clause's prohibition against imposts or duties on "imports." In the License Cases he observed that "further and more mature reflection has convinced me that the rule laid down [in ] is a just and safe one, and perhaps the best that could have been adopted for preserving the right of the United States on the one hand, and of the States on the other, and preventing collision between them. The question, I have already said, was a very difficult one for the judicial mind. In the nature of things, the line of division is in some degree vague and indefinite, and I do not see how it could be drawn more accurately and correctly, or more in harmony with the obvious intention and object of this provision in the *300 constitution. Indeed, goods imported, while they remain in the hands of the importer, in the form and shape in which they were brought into the country, can in no just sense be regarded as a part of that mass of property in the State usually taxed for the support of the State government." quoted this -34, as supporting the holding, that "a tax upon [imported goods], in any shape, is within the constitutional prohibition." But Mr. Chief Justice Taney said much more in his opinion in the License Cases, and what he said further makes crystal clear that the prohibition applied only to state exactions upon imports as imports and did not apply to nondiscriminatory ad valorem property taxes. For, continuing his analysis in the very paragraph from which ed only a part, he concluded: "A tax in any shape cannot be done directly, in the shape of a duty on imports, for that is expressly prohibited. And as it cannot be done directly, it could hardly be a just and sound construction of the constitution which would enable a State to accomplish precisely the same thing under another name, and in a different form." The Chief Justice then went on to distinguish an exaction upon imports as imports from property taxes indiscriminately applied to all owners of property, stating, : "Undoubtedly a State may impose a tax upon its citizens in proportion to the amount they are respectively worth; and the importing merchant is liable to this assessment like any other citizen, and is chargeable according to the amount of his property, whether it consists of money engaged in trade, or of imported goods which he proposes to sell, or any other property of which he is the owner. *301 But a tax of this description stands upon a very different footing from a tax on the thing imported, while it remains a part of foreign commerce, and is not introduced into the general mass of property in the State." (Emphasis supplied.) Thus Mr. Chief Justice Taney's opinion is authority, precisely contrary to the reading of that nondiscriminatory ad valorem property taxes are not prohibited by the Import-Export Clause. It follows from the foregoing that was wrongly decided. That decision therefore must be, and is, overruled.[13] *302 V Petitioner's tires in this case were no longer in transit. They were stored in a distribution warehouse from which petitioner conducted a wholesale operation, taking orders from franchised dealers and filling them from a constantly replenished inventory. The warehouse was operated no differently than would be a distribution warehouse utilized by a wholesaler dealing solely in domestic goods, and we therefore hold that the non-discriminatory property tax levied on petitioner's inventory of imported tires was not interdicted by the Import-Export Clause of the Constitution. The judgment of the Supreme Court of Georgia is accordingly Affirmed. MR. JUSTICE STEVENS took no part in the consideration or decision of this case. MR. JUSTICE WHITE, concurring in the judgment. |
Justice Marshall | majority | false | United States v. Mitchell | 1980-06-02T00:00:00 | null | https://www.courtlistener.com/opinion/110233/united-states-v-mitchell/ | https://www.courtlistener.com/api/rest/v3/clusters/110233/ | 1,980 | 1979-065 | 2 | 5 | 3 | This case presents the question whether the Indian General Allotment Act of 1887 authorizes the award of money damages against the United States for alleged mismanagement of forests located on lands allotted to Indians under that Act.
I
In 1873, a Reservation was established by Executive Order in the State of Washington for the Quinault Tribe. 1 C. Kappler, Indian Affairs 923 (2d ed. 1904). Much of the land within the Reservation was forested. By 1935, acting under the authority of the General Allotment Act of 1887, ch. 119, 24 Stat. 388, as amended, 25 U.S. C. § 331 et seq., the Government had allotted all of the Reservation's land in trust *537 to individual Indians. Other enactments of Congress require the Secretary of the Interior to manage these forests, sell the timber, and pay the proceeds of such sales, less administrative expenses, to the allottees.[1]
The respondents are 1,465 individual allottees of land contained in the Quinault Reservation, the Quinault Tribe, which now holds some allotments, and the Quinault Allottees Association, an unincorporated association formed to promote the interests of the allottees of the Quinault Reservation. In four actions consolidated in the Court of Claims, the respondents sought to recover damages from the Government for alleged mismanagement of timber resources found on the Reservation. The respondents asserted that the Government: (1) failed to obtain fair market value for timber sold; (2) failed to manage timber on a sustained-yield basis and to rehabilitate the land after logging; (3) failed to obtain payment for some merchantable timber; (4) failed to develop a proper system of roads and easements for timber operations and exacted improper charges from allottees for roads; (5) failed to pay interest on certain funds and paid insufficient interest on other funds; and (6) exacted excessive administrative charges from allottees. The respondents contended that they were entitled to recover money damages because this alleged misconduct breached a fiduciary duty owed to them by the United States as trustee of the allotted lands under the General Allotment Act.
The United States moved to dismiss the respondents' actions on the ground that it had not waived its sovereign *538 immunity with respect to the claims raised. The Court of Claims, sitting en banc, denied the Government's motion. 219 Ct. Cl. 95, 591 F.2d 1300 (1979). Reasoning that Government mismanagement of the kind alleged breaches the Government's fiduciary duty under the General Allotment Act, the court held that the Act provides Indian allottees a cause of action for money damages against the United States.
We granted certiorari, 442 U.S. 940 (1979), and now reverse and remand.
II
It is elementary that "[t]he United States, as sovereign, is immune from suit save as it consents to be sued . . . , and the terms of its consent to be sued in any court define that court's jurisdiction to entertain the suit." United States v. Sherwood, 312 U.S. 584, 586 (1941). A waiver of sovereign immunity "cannot be implied but must be unequivocally expressed." United States v. King, 395 U.S. 1, 4 (1969). In the absence of clear congressional consent, then, "there is no jurisdiction in the Court of Claims more than in any other court to entertain suits against the United States." United States v. Sherwood, supra, at 587-588.
The individual claimants in this action premised jurisdiction in the Court of Claims upon the Tucker Act, 28 U.S. C. § 1491, which gives that court jurisdiction of "any claim against the United States founded either upon the Constitution, or any Act of Congress." The Tucker Act is "only a jurisdictional statute; it does not create any substantive right enforceable against the United States for money damages." United States v. Testan, 424 U.S. 392, 398 (1976). The Act merely "confers jurisdiction upon [the Court of Claims] whenever the substantive right exists." Ibid. The individual claimants, therefore, must look beyond the jurisdictional statute for a waiver of sovereign immunity with respect to their claims.
The same is true for the tribal claimant. Jurisdiction over *539 its claims was based on § 24 of the Indian Claims Commission Act, 28 U.S. C. § 1505. That provision states:
"The Court of Claims shall have jurisdiction of any claim against the United States accruing after August 13, 1946, in favor of any tribe, band, or other identifiable group of American Indians residing within the territorial limits of the United States or Alaska whenever such claim is one arising under the Constitution, laws or treaties of the United States, or Executive orders of the President, or is one which otherwise would be cognizable in the Court of Claims if the claimant were not an Indian tribe, band or group."
By enacting this statute, Congress plainly intended to give tribal claimants the same access to the Court of Claims provided to individuals by the Tucker Act. The House Committee Report stated:
"As respects claims accruing after its adoption this bill confers jurisdiction on the Court of Claims to determine and adjudicate any tribal claim of a character which would be cognizable in the Court of Claims if the claimant were not an Indian tribe. In such cases the claimants are to be entitled to recover in the same manner, to the same extent, and subject to the same conditions and limitations, and the United States shall be entitled to the same defenses, both at law and in equity, . . . as in cases brought in the Court of Claims by non-Indians under section 145 of the Judicial Code [now 28 U.S. C. § 1491], as amended." H. R. Rep. No. 1466, 79th Cong., 1st Sess., 13 (1945).
See also Hearings on H. R. 1198 and H. R. 1341 before the House Committee on Indian Affairs, 79th Cong., 1st Sess., 149 (1945) (statement of Assistant Solicitor Cohen); H. R. Rep. No. 352, 81st Cong., 1st Sess., 15-16 (1949) (recodifying the statute).
*540 Under 28 U.S. C. § 1505, then, tribal claimants have the same access to the Court of Claims provided to individual claimants by 28 U.S. C. § 1491, and the United States is entitled to the same defenses at law and in equity under both statutes. It follows that 28 U.S. C. § 1505 no more confers a substantive right against the United States to recover money damages than does 28 U.S. C. § 1491.[2]
III
Section 1 of the General Allotment Act authorizes the President to allot to each Indian residing on a reservation up to 80 acres of agricultural land or 160 acres of grazing land found within the reservation. 24 Stat. 388, as amended, 25 U.S. C. § 331. Section 5 of the Act provides that the United *541 States shall retain title to such allotted lands in trust for the benefit of the allottees:
"Upon the approval of the allotments provided for in this act by the Secretary of the Interior, he shall cause patents to issue therefor in the name of the allottees, which patents shall be of the legal effect, and declare that the United States does and will hold the land thus allotted, for the period of twenty-five years, in trust for the sole use and benefit of the Indian to whom such allotment shall have been made . . . and that at the expiration of said period the United States will convey the same by patent to said Indian . . . , in fee, discharged of said trust and free of all charge or incumbrance whatsoever: Provided, That the President of the United States may in any case in his discretion extend the period. And if any conveyance shall be made of the lands set apart and allotted as herein provided, or any contract made touching the same, before the expiration of the time above mentioned, such conveyance or contract shall be absolutely null and void." 24 Stat. 389, as amended, 25 U.S. C. § 348.
Under § 2 of the Indian Reorganization Act of 1934, 48 Stat. 984, 25 U.S. C. § 462, the United States now holds title to these lands indefinitely.
The Court of Claims held that the General Allotment Act creates a fiduciary duty on the part of the United States to manage timber resources properly and constitutes a waiver of sovereign immunity against a suit for money damages as compensation for breaches of that duty. The court drew both of these conclusions from the Act's language providing that the United States is to "hold the land . . . in trust for the sole use and benefit of the" allottee. The court held that this language created an express trust, and concluded that money damages are available to compensate for breaches of this trust, apparently because that remedy is available in the *542 ordinary situation in which a trustee has violated a fiduciary duty and because without money damages allottees would have no effective redress for breaches of trust.
We need not consider whether, had Congress actually intended the General Allotment Act to impose upon the Government all fiduciary duties ordinarily placed by equity upon a trustee, the Act would constitute a waiver of sovereign immunity. We conclude that the Act created only a limited trust relationship between the United States and the allottee that does not impose any duty upon the Government to manage timber resources.
The Act does not unambiguously provide that the United States has undertaken full fiduciary responsibilities as to the management of allotted lands. The language of § 5 that imposes the trust in question must be read in pari materia with the language of §§ 1 and 2.[3] Both of these sections indicate that the Indian allottee, and not a representative of the United States, is responsible for using the land for agricultural *543 cultural or grazing purposes. Furthermore, the legislative history of the Act[4] plainly indicates that the trust Congress placed on allotted lands is of limited scope. Congress intended that, even during the period in which title to allotted land would remain in the United States, the allottee would occupy the land as a homestead for his personal use in agriculture or grazing. See Mattz v. Arnett, 412 U.S. 481, 496 (1973); 13 Cong. Rec. 3211 (1882) (Sen. Dawes) (the allottee is to be "the occupant of the land and enjoy all its use"). See also H. R. Rep. No. 2247, 48th Cong., 2d Sess., 1 (1885); 17 Cong. Rec. 1630-1631 (1886) (Sens. Plumb and Dawes); id., at 1632 (Sen. Maxey); 18 Cong. Rec. 190-191 (1886) (Rep. Skinner). Under this scheme, then, the allottee, and not the United States, was to manage the land.
The earliest drafts of the Act provided that, during the 25-year period before the allottee would receive fee simple title, the allottee would hold title to the land subject to a restraint on alienation. S. 1773, 46th Cong., 3d Sess. (1880); S. 1455, 47th Cong., 1st Sess. (1882). On Senator Dawes' motion, this language was amended to provide that the United States would hold the land "in trust" for that period. 13 Cong. Rec. 3212 (1882). Senator Dawes explained that the statute as amended would still ensure that title to the land would be transferred to the Indian allottee at the expiration of 25 years. He promoted the amendment because he feared that States might attempt to tax allotted lands if the allottees held title to them subject to a restraint on alienation. By placing title in the United States in trust for the *544 allottee, his amendment made it "impossible to raise the question of [state] taxation." Id., at 3211. The next draft of the Act introduced in the Congress reflected this amendment, see S. 48, 48th Cong., 1st Sess. (1884), as, of course, did the Act as enacted, 24 Stat. 388 (1887). It is plain, then, that when Congress enacted the General Allotment Act, it intended that the United States "hold the land . . . in trust" not because it wished the Government to control use of the land and be subject to money damages for breaches of fiduciary duty, but simply because it wished to prevent alienation of the land and to ensure that allottees would be immune from state taxation.[5]
*545 Furthermore, events surrounding and following the passage of the General Allotment Act indicate that the Act should not be read as authorizing, much less requiring, the Government to manage timber resources for the benefit of Indian allottees. In 1874, this Court determined that Indians held only a right of occupancy, and not title, to Indian lands, and therefore that they could cut timber for the purpose of clearing the land, but not for the primary purpose of marketing the timber. United States v. Cook, 19 Wall. 591. In 1889, two years after the General Allotment Act was enacted, the Attorney General determined that the rule of United States v. Cook, supra, applied to allotted as well as unallotted lands, unless a statute explicitly provided to the contrary. 19 Op. Atty. Gen. 232. Congress ratified the Attorney General's opinion by enacting a provision authorizing the sale of dead timber on Indian allotments and reservations, but forbidding the sale of live timber. Act of Feb. 16, 1889, ch. 172, 25 Stat. 673. See also Pine River Logging Co. v. United States, 186 U.S. 279 (1902).
As time passed, Congress occasionally passed legislation authorizing the harvesting and sale of timber on specific reservations. See, e. g., ch. 1350, 34 Stat. 91 (1906) (Jicarilla Apache Reservation). In 1910, Congress reversed its general policy. It empowered the Secretary of the Interior to sell timber on unallotted lands and apply the proceeds of the sales, less administrative expenses, to the benefit of the Indians. Ch. 431, § 7, 36 Stat. 857, as amended, 25 U.S. C. § 407. The Secretary was also authorized to consent to the sale of timber by the owner of any Indian land "held under a trust or other patent containing restrictions on alienations." Id., § 8, as amended, 25 U.S. C. § 406 (a). The Secretary *546 was directed to pay the proceeds of these sales, less administrative expenses, to the "owner" of the allotted lands. Ibid. Congress subsequently enacted other legislation directing the Secretary on how to manage Indian timber resources.[6]
The General Allotment Act, then, cannot be read as establishing that the United States has a fiduciary responsibility for management of allotted forest lands. Any right of the respondents to recover money damages for Government mis-management of timber resources must be found in some source other than that Act.[7]
The judgment of the Court of Claims is reversed, and the case is remanded for further proceedings consistent with this opinion.
It is so ordered.
THE CHIEF JUSTICE took no part in the decision of this case.
MR. JUSTICE WHITE, with whom MR. JUSTICE BRENNAN and MR. | This case presents the question whether the Indian General Allotment Act of 1887 authorizes the award of money damages against the United States for alleged mismanagement of forests located on lands allotted to Indians under that Act. I In 1873, a Reservation was established by Executive Order in the State of Washington for the Quinault Tribe. 1 C. Kappler, Indian Affairs 923 (2d ed. 190). Much of the land within the Reservation was forested. By 1935, acting under the authority of the General Allotment Act of 1887, ch. 119, as amended, 25 U.S. C. 331 et seq., the Government had allotted all of the Reservation's land in trust *537 to individual Indians. Other enactments of Congress require the Secretary of the Interior to manage these forests, sell the timber, and pay the proceeds of such sales, less administrative expenses, to the allottees.[1] The respondents are 1,65 individual allottees of land contained in the Quinault Reservation, the Quinault Tribe, which now holds some allotments, and the Quinault Allottees Association, an unincorporated association formed to promote the interests of the allottees of the Quinault Reservation. In four actions consolidated in the Court of Claims, the respondents sought to recover damages from the Government for alleged mismanagement of timber resources found on the Reservation. The respondents asserted that the Government: (1) failed to obtain fair market value for timber sold; (2) failed to manage timber on a sustained-yield basis and to rehabilitate the land after logging; (3) failed to obtain payment for some merchantable timber; () failed to develop a proper system of roads and easements for timber operations and exacted improper charges from allottees for roads; (5) failed to pay interest on certain funds and paid insufficient interest on other funds; and (6) exacted excessive administrative charges from allottees. The respondents contended that they were entitled to recover money damages because this alleged misconduct breached a fiduciary duty owed to them by the United States as trustee of the allotted lands under the General Allotment Act. The United States moved to dismiss the respondents' actions on the ground that it had not waived its sovereign *538 immunity with respect to the claims raised. The Court of Claims, sitting en banc, denied the Government's motion. Reasoning that Government mismanagement of the kind alleged breaches the Government's fiduciary duty under the General Allotment Act, the court held that the Act provides Indian allottees a cause of action for money damages against the United States. We granted certiorari, and now reverse and remand. II It is elementary that "[t]he United States, as sovereign, is immune from suit save as it consents to be sued and the terms of its consent to be sued in any court define that court's jurisdiction to entertain the suit." United A waiver of sovereign immunity "cannot be implied but must be unequivocally expressed." United In the absence of clear congressional consent, then, "there is no jurisdiction in the Court of Claims more than in any other court to entertain suits against the United States." United The individual claimants in this action premised jurisdiction in the Court of Claims upon the Tucker Act, 28 U.S. C. 191, which gives that court jurisdiction of "any claim against the United States founded either upon the Constitution, or any Act of Congress." The Tucker Act is "only a jurisdictional statute; it does not create any substantive right enforceable against the United States for money damages." United 2 U.S. 392, The Act merely "confers jurisdiction upon [the Court of Claims] whenever the substantive right exists." The individual claimants, therefore, must look beyond the jurisdictional statute for a waiver of sovereign immunity with respect to their claims. The same is true for the tribal claimant. Jurisdiction over *539 its claims was based on 2 of the Indian Claims Commission Act, 28 U.S. C. 1505. That provision states: "The Court of Claims shall have jurisdiction of any claim against the United States accruing after August 13, 196, in favor of any tribe, band, or other identifiable group of American Indians residing within the territorial limits of the United States or Alaska whenever such claim is one arising under the Constitution, laws or treaties of the United States, or Executive orders of the President, or is one which otherwise would be cognizable in the Court of Claims if the claimant were not an Indian tribe, band or group." By enacting this statute, Congress plainly intended to give tribal claimants the same access to the Court of Claims provided to individuals by the Tucker Act. The House Committee Report stated: "As respects claims accruing after its adoption this bill confers jurisdiction on the Court of Claims to determine and adjudicate any tribal claim of a character which would be cognizable in the Court of Claims if the claimant were not an Indian tribe. In such cases the claimants are to be entitled to recover in the same manner, to the same extent, and subject to the same conditions and limitations, and the United States shall be entitled to the same defenses, both at law and in equity, as in cases brought in the Court of Claims by non-Indians under section 15 of the Judicial Code [now 28 U.S. C. 191], as amended." H. R. Rep. No. 166, 79th Cong., 1st Sess., 13 (195). See also Hearings on H. R. 1198 and H. R. 131 before the House Committee on Indian Affairs, 79th Cong., 1st Sess., 19 (195) (statement of Assistant Solicitor Cohen); H. R. Rep. No. 352, 81st Cong., 1st Sess., 15-16 (199) (recodifying the statute). *50 Under 28 U.S. C. 1505, then, tribal claimants have the same access to the Court of Claims provided to individual claimants by 28 U.S. C. 191, and the United States is entitled to the same defenses at law and in equity under both statutes. It follows that 28 U.S. C. 1505 no more confers a substantive right against the United States to recover money damages than does 28 U.S. C. 191.[2] III Section 1 of the General Allotment Act authorizes the President to allot to each Indian residing on a reservation up to 80 acres of agricultural land or 160 acres of grazing land found within the reservation. as amended, 25 U.S. C. 331. Section 5 of the Act provides that the United *51 States shall retain title to such allotted lands in trust for the benefit of the allottees: "Upon the approval of the allotments provided for in this act by the Secretary of the Interior, he shall cause patents to issue therefor in the name of the allottees, which patents shall be of the legal effect, and declare that the United States does and will hold the land thus allotted, for the period of twenty-five years, in trust for the sole use and benefit of the Indian to whom such allotment shall have been made and that at the expiration of said period the United States will convey the same by patent to said Indian in fee, discharged of said trust and free of all charge or incumbrance whatsoever: Provided, That the President of the United States may in any case in his discretion extend the period. And if any conveyance shall be made of the lands set apart and allotted as herein provided, or any contract made touching the same, before the expiration of the time above mentioned, such conveyance or contract shall be absolutely null and void." 2 Stat. 389, as amended, 25 U.S. C. 38. Under 2 of the Indian Reorganization Act of 193, 8 Stat. 98, 25 U.S. C. 62, the United States now holds title to these lands indefinitely. The Court of Claims held that the General Allotment Act creates a fiduciary duty on the part of the United States to manage timber resources properly and constitutes a waiver of sovereign immunity against a suit for money damages as compensation for breaches of that duty. The court drew both of these conclusions from the Act's language providing that the United States is to "hold the land in trust for the sole use and benefit of the" allottee. The court held that this language created an express trust, and concluded that money damages are available to compensate for breaches of this trust, apparently because that remedy is available in the *52 ordinary situation in which a trustee has violated a fiduciary duty and because without money damages allottees would have no effective redress for breaches of trust. We need not consider whether, had Congress actually intended the General Allotment Act to impose upon the Government all fiduciary duties ordinarily placed by equity upon a trustee, the Act would constitute a waiver of sovereign immunity. We conclude that the Act created only a limited trust relationship between the United States and the allottee that does not impose any duty upon the Government to manage timber resources. The Act does not unambiguously provide that the United States has undertaken full fiduciary responsibilities as to the management of allotted lands. The language of 5 that imposes the trust in question must be read in pari materia with the language of 1 and 2.[3] Both of these sections indicate that the Indian allottee, and not a representative of the United States, is responsible for using the land for agricultural *53 cultural or grazing purposes. Furthermore, the legislative history of the Act[] plainly indicates that the trust Congress placed on allotted lands is of limited scope. Congress intended that, even during the period in which title to allotted land would remain in the United States, the allottee would occupy the land as a homestead for his personal use in agriculture or grazing. See 12 U.S. 81, 96 ; 13 Cong. Rec. 3211 (1882) (Sen. Dawes) (the allottee is to be "the occupant of the land and enjoy all its use"). See also H. R. Rep. No. 227, 8th Cong., 2d Sess., 1 (1885); 17 Cong. Rec. 1630-1631 (1886) (Sens. Plumb and Dawes); ; 18 Cong. Rec. 190-191 (1886) (Rep. Skinner). Under this scheme, then, the allottee, and not the United States, was to manage the land. The earliest drafts of the Act provided that, during the 25-year period before the allottee would receive fee simple title, the allottee would hold title to the land subject to a restraint on alienation. S. 1773, 6th Cong., 3d Sess. (1880); S. 155, 7th Cong., 1st Sess. (1882). On Senator Dawes' motion, this language was amended to provide that the United States would hold the land "in trust" for that period. 13 Cong. Rec. 3212 (1882). Senator Dawes explained that the statute as amended would still ensure that title to the land would be transferred to the Indian allottee at the expiration of 25 years. He promoted the amendment because he feared that States might attempt to tax allotted lands if the allottees held title to them subject to a restraint on alienation. By placing title in the United States in trust for the *5 allottee, his amendment made it "impossible to raise the question of [state] taxation." The next draft of the Act introduced in the Congress reflected this amendment, see S. 8, 8th Cong., 1st Sess. (188), as, of course, did the Act as enacted, (1887). It is plain, then, that when Congress enacted the General Allotment Act, it intended that the United States "hold the land in trust" not because it wished the Government to control use of the land and be subject to money damages for breaches of fiduciary duty, but simply because it wished to prevent alienation of the land and to ensure that allottees would be immune from state taxation.[5] *55 Furthermore, events surrounding and following the passage of the General Allotment Act indicate that the Act should not be read as authorizing, much less requiring, the Government to manage timber resources for the benefit of Indian allottees. In 187, this Court determined that Indians held only a right of occupancy, and not title, to Indian lands, and therefore that they could cut timber for the purpose of clearing the land, but not for the primary purpose of marketing the timber. United In 1889, two years after the General Allotment Act was enacted, the Attorney General determined that the rule of United applied to allotted as well as unallotted lands, unless a statute explicitly provided to the contrary. 19 Op. Atty. Gen. 232. Congress ratified the Attorney General's opinion by enacting a provision authorizing the sale of dead timber on Indian allotments and reservations, but forbidding the sale of live timber. Act of Feb. 16, 1889, ch. 172, See also Pine River Logging As time passed, Congress occasionally passed legislation authorizing the harvesting and sale of timber on specific reservations. See, e. g., ch. 1350, 3 Stat. 91 (1906) In 1910, Congress reversed its general policy. It empowered the Secretary of the Interior to sell timber on unallotted lands and apply the proceeds of the sales, less administrative expenses, to the benefit of the Indians. Ch. 31, 7, as amended, 25 U.S. C. 07. The Secretary was also authorized to consent to the sale of timber by the owner of any Indian land "held under a trust or other patent containing restrictions on alienations." 8, as amended, 25 U.S. C. 06 (a). The Secretary *56 was directed to pay the proceeds of these sales, less administrative expenses, to the "owner" of the allotted lands. Congress subsequently enacted other legislation directing the Secretary on how to manage Indian timber resources.[6] The General Allotment Act, then, cannot be read as establishing that the United States has a fiduciary responsibility for management of allotted forest lands. Any right of the respondents to recover money damages for Government mis-management of timber resources must be found in some source other than that Act.[7] The judgment of the Court of Claims is reversed, and the case is remanded for further proceedings consistent with this opinion. It is so ordered. THE CHIEF JUSTICE took no part in the decision of this case. MR. JUSTICE WHITE, with whom MR. JUSTICE BRENNAN and MR. |
Justice Burger | concurring | false | Teamsters v. Daniel | 1979-01-16T00:00:00 | null | https://www.courtlistener.com/opinion/109975/teamsters-v-daniel/ | https://www.courtlistener.com/api/rest/v3/clusters/109975/ | 1,979 | 1978-033 | 1 | 8 | 0 | I join in the opinion of the Court except as to the discussion of the 1970 amendment to § 3 (a) (2) of the Securities Act. There is no need to deal, in this case, with the scope of the exemption, since it is not an issue presented for decision.
The Commission argues that the new exemption from the registration requirement of the Act applies to participation in a pension plan, and infers that Congress must have understood that such participation is a security which otherwise would be subject to the Act. It is not necessary to evaluate the Commission's interpretation of the exemption, however, because even if it is correct, it does not support the conclusion the Commission draws.
*571 First, the inference concerning Congress' understanding of the Act in 1970 is tenuous. The language of the amendment covers a variety of financial interests, some of which clearly are "securities" as defined in the Act. Congress most likely acted with a view to those interests, without considering other financial interests like those involved here, for which registration never had been required.
Second, even if a draftsman concerned with exempting a variety of interests from the registration requirement may have believed, in 1970, that certain pension interests were within the statutory definition of "security," that would have little, if any, bearing on this case. At issue here is the construction of definitions enacted in 1933 and 1934.
The briefs suggest that the construction of the 1970 amendment may be problematic. The scope of the exemption may be of real importance to someone in some future casebut it is not so in connection with this action. Accordingly, I reserve any expression of views on the issue at this time.
| I join in the opinion of the Court except as to the discussion of the 1970 amendment to 3 (a) (2) of the Securities Act. There is no need to deal, in this case, with the scope of the exemption, since it is not an issue presented for decision. The Commission argues that the new exemption from the registration requirement of the Act applies to participation in a pension plan, and infers that Congress must have understood that such participation is a security which otherwise would be subject to the Act. It is not necessary to evaluate the Commission's interpretation of the exemption, however, because even if it is correct, it does not support the conclusion the Commission draws. *571 First, the inference concerning Congress' understanding of the Act in 1970 is tenuous. The language of the amendment covers a variety of financial interests, some of which clearly are "securities" as defined in the Act. Congress most likely acted with a view to those interests, without considering other financial interests like those involved here, for which registration never had been required. Second, even if a draftsman concerned with exempting a variety of interests from the registration requirement may have believed, in 1970, that certain pension interests were within the statutory definition of "security," that would have little, if any, bearing on this case. At issue here is the construction of definitions enacted in 1933 and 1934. The briefs suggest that the construction of the 1970 amendment may be problematic. The scope of the exemption may be of real importance to someone in some future casebut it is not so in connection with this action. Accordingly, I reserve any expression of views on the issue at this time. |
Justice Marshall | dissenting | false | Kelley v. Johnson | 1976-04-05T00:00:00 | null | https://www.courtlistener.com/opinion/109423/kelley-v-johnson/ | https://www.courtlistener.com/api/rest/v3/clusters/109423/ | 1,976 | 1975-071 | 1 | 6 | 2 | The Court today upholds the constitutionality of Suffolk County's regulation limiting the length of a policeman's *250 hair. While the Court only assumes for purposes of its opinion that "the citizenry at large has some sort of `liberty' interest within the Fourteenth Amendment in matters of personal appearance . . . ," ante, at 244, I think it clear that the Fourteenth Amendment does indeed protect against comprehensive regulation of what citizens may or may not wear. And I find that the rationales offered by the Court to justify the regulation in this case are insufficient to demonstrate its constitutionality. Accordingly, I respectfully dissent.
I
As the Court recognizes, the Fourteenth Amendment's guarantee against the deprivation of liberty "protects substantive aspects of liberty against unconstitutional restrictions by the State." Ante, at 244. And we have observed that "[l]iberty under law extends to the full range of conduct which the individual is free to pursue." Bolling v. Sharpe, 347 U.S. 497, 499 (1954). See also Poe v. Ullman, 367 U.S. 497, 543 (1961) (Harlan, J., dissenting).[1] It seems to me manifest that that "full range of conduct" must encompass one's interest in dressing according to his own taste. An individual's personal appearance may reflect, sustain, and nourish his personality and may well be used as a means of expressing his *251 attitude and lifestyle.[2] In taking control over a citizen's personal appearance, the government forces him to sacrifice substantial elements of his integrity and identity as well. To say that the liberty guarantee of the Fourteenth Amendment does not encompass matters of personal appearance would be fundamentally inconsistent with the values of privacy, self-identity, autonomy, and personal integrity that I have always assumed the Constitution was designed to protect. See Roe v. Wade, 410 U.S. 113 (1973); Stanley v. Georgia, 394 U.S. 557, 564 (1969); Griswold v. Connecticut, 381 U.S. 479, 485 (1965); Olmstead v. United States, 277 U.S. 438, 478 (1928) (Brandeis, J., dissenting).
If little can be found in past cases of this Court or indeed in the Nation's history on the specific issue of a citizen's right to choose his own personal appearance, it is only because the right has been so clear as to be beyond question. When the right has been mentioned, its existence has simply been taken for granted. For instance, the assumption that the right exists is reflected in the 1789 congressional debates over which guarantees should be explicitly articulated in the Bill of Rights. I. Brant. The Bill of Rights 53-67 (1965). There was considerable debate over whether the right of assembly should be expressly mentioned. Congressman Benson of New York argued that its inclusion was necessary to assure that the right would not be infringed by the government. In response, Congressman Sedgwick of Massachusetts indicated:
"If the committee were governed by that general *252 principle . . . they might have declared that a man should have a right to wear his hat if he pleased . . . but [I] would ask the gentleman whether he thought it necessary to enter these trifles in a declaration of rights, in a Government where none of them were intended to be infringed." Id., at 54-55 (emphasis added).
Thus, while they did not include it in the Bill of Rights, Sedgwick and his colleagues clearly believed there to be a right in one's personal appearance. And, while they may have regarded the right as a trifle as long as it was honored, they clearly would not have so regarded it if it were infringed.
This Court, too, has taken as an axiom that there is a right in one's personal appearance.[3] Indeed, in 1958 we used the existence of that right as support for our recognition of the right to travel:
"The right to travel is a part of the `liberty' of which the citizen cannot be deprived without due process of law under the Fifth Amendment. . . . It may be as close to the heart of the individual as the choice *253 of what he eats, or wears, or reads." Kent v. Dulles, 357 U.S. 116, 125 126 (1958) (emphasis added).
To my mind, the right in one's personal appearance is inextricably bound up with the historically recognized right of "every individual to the possession and control of his own person," Union Pacific R. Co. v. Botsford, 141 U.S. 250, 251 (1891), and, perhaps even more fundamentally, with "the right to be let alonethe most comprehensive of rights and the right most valued by civilized men." Olmstead v. United States, supra, at 478 (Brandeis, J., dissenting). In an increasingly crowded society in which it is already extremely difficult to maintain one's identity and personal integrity, it would be distressing, to say the least, if the government could regulate our personal appearance unconfined by any constitutional strictures whatsoever.[4]
*254 II
Acting on its assumption that the Fourteenth Amendment does encompass a right in one's personal appearance, the Court justifies the challenged hair-length regulation on the grounds that such regulations may "be based on a desire to make police officers readily recognizable to the members of the public, or a desire for the esprit de corps which such similarity is felt to inculcate within the police force itself." Ante, at 248. While fully accepting the aims of "identifiability" and maintenance of esprit de corps, I find no rational relationship between the challenged regulation and these goals.[5]
As for the first justification offered by the Court, I simply do not see how requiring policemen to maintain hair of under a certain length could rationally be argued to contribute to making them identifiable to the public as policemen. Surely, the fact that a uniformed police officer is wearing his hair below his collar will make him *255 no less identifiable as a policeman. And one cannot easily imagine a plainclothes officer being readily identifiable as such simply because his hair does not extend beneath his collar.
As for the Court's second justification, the fact that it is the president of the Patrolmen's Benevolent Association, in his official capacity, who has challenged the regulation here would seem to indicate that the regulation would if anything, decrease rather than increase the police force's esprit de corps.[6] And even if one accepted the argument that substantial similarity in appearance would increase a force's esprit de corps, I simply do not understand how implementation of this regulation could be expected to create any increment in similarity of appearance among members of a uniformed police force. While the regulation prohibits hair below the ears or the collar and limits the length of sideburns, it allows the maintenance of any type of hairstyle, other than a ponytail. Thus, as long as their hair does not go below their collars, two police officers, one with an "Afro" hair style and the other with a crewcut could both be in full compliance with the regulation.[7]
*256 The Court cautions us not to view the hair-length regulation in isolation, but rather to examine it "in the context of the county's chosen mode of organization for its police force." Ante, at 247. While the Court's caution is well taken, one should also keep in mind, as I fear the Court does not, that what is ultimately under scrutiny is neither the overall structure of the police force nor the uniform and equipment requirements to which its members are subject, but rather the regulation which dictates acceptable hair lengths. The fact that the uniform requirement, for instance, may be rationally related to the goals of increasing police officer "identifiability" and the maintenance of esprit de corps does absolutely nothing to establish the legitimacy of the hair-length regulation. I see no connection between the regulation and the offered rationales[8] and would accordingly affirm the judgment of the Court of Appeals.
| The Court today upholds the constitutionality of Suffolk County's regulation limiting the length of a policeman's *250 hair. While the Court only assumes for purposes of its opinion that "the citizenry at large has some sort of `liberty' interest within the Fourteenth Amendment in matters of personal appearance" ante, at 244, I think it clear that the Fourteenth Amendment does indeed protect against comprehensive regulation of what citizens may or may not wear. And I find that the rationales offered by the Court to justify the regulation in this case are insufficient to demonstrate its constitutionality. Accordingly, I respectfully dissent. I As the Court recognizes, the Fourteenth Amendment's guarantee against the deprivation of liberty "protects substantive aspects of liberty against unconstitutional restrictions by the State." Ante, at 244. And we have observed that "[l]iberty under law extends to the full range of conduct which the individual is free to pursue." See also[1] It seems to me manifest that that "full range of conduct" must encompass one's interest in dressing according to his own taste. An individual's personal appearance may reflect, sustain, and nourish his personality and may well be used as a means of expressing his * attitude and lifestyle.[2] In taking control over a citizen's personal appearance, the government forces him to sacrifice substantial elements of his integrity and identity as well. To say that the liberty guarantee of the Fourteenth Amendment does not encompass matters of personal appearance would be fundamentally inconsistent with the values of privacy, self-identity, autonomy, and personal integrity that I have always assumed the Constitution was designed to protect. See ; ; ; If little can be found in past cases of this Court or indeed in the Nation's history on the specific issue of a citizen's right to choose his own personal appearance, it is only because the right has been so clear as to be beyond question. When the right has been mentioned, its existence has simply been taken for granted. For instance, the assumption that the right exists is reflected in the 1789 congressional debates over which guarantees should be explicitly articulated in the Bill of Rights. I. Brant. The Bill of Rights 53-67 There was considerable debate over whether the right of assembly should be expressly mentioned. Congressman Benson of New York argued that its inclusion was necessary to assure that the right would not be infringed by the government. In response, Congressman Sedgwick of Massachusetts indicated: "If the committee were governed by that general *252 principle they might have declared that a man should have a right to wear his hat if he pleased but [I] would ask the gentleman whether he thought it necessary to enter these trifles in a declaration of rights, in a Government where none of them were intended to be infringed." Thus, while they did not include it in the Bill of Rights, Sedgwick and his colleagues clearly believed there to be a right in one's personal appearance. And, while they may have regarded the right as a trifle as long as it was honored, they clearly would not have so regarded it if it were infringed. This Court, too, has taken as an axiom that there is a right in one's personal appearance.[3] Indeed, in 1958 we used the existence of that right as support for our recognition of the right to travel: "The right to travel is a part of the `liberty' of which the citizen cannot be deprived without due process of law under the Fifth Amendment. It may be as close to the heart of the individual as the choice *253 of what he eats, or wears, or reads." To my mind, the right in one's personal appearance is inextricably bound up with the historically recognized right of "every individual to the possession and control of his own person," Union Pacific R. and, perhaps even more fundamentally, with "the right to be let alonethe most comprehensive of rights and the right most valued by civilized men." at In an increasingly crowded society in which it is already extremely difficult to maintain one's identity and personal integrity, it would be distressing, to say the least, if the government could regulate our personal appearance unconfined by any constitutional strictures whatsoever.[4] *254 II Acting on its assumption that the Fourteenth Amendment does encompass a right in one's personal appearance, the Court justifies the challenged hair-length regulation on the grounds that such regulations may "be based on a desire to make police officers readily recognizable to the members of the public, or a desire for the esprit de corps which such similarity is felt to inculcate within the police force itself." Ante, at 248. While fully accepting the aims of "identifiability" and maintenance of esprit de corps, I find no rational relationship between the challenged regulation and these goals.[5] As for the first justification offered by the Court, I simply do not see how requiring policemen to maintain hair of under a certain length could rationally be argued to contribute to making them identifiable to the public as policemen. Surely, the fact that a uniformed police officer is wearing his hair below his collar will make him *255 no less identifiable as a policeman. And one cannot easily imagine a plainclothes officer being readily identifiable as such simply because his hair does not extend beneath his collar. As for the Court's second justification, the fact that it is the president of the Patrolmen's Benevolent Association, in his official capacity, who has challenged the regulation here would seem to indicate that the regulation would if anything, decrease rather than increase the police force's esprit de corps.[6] And even if one accepted the argument that substantial similarity in appearance would increase a force's esprit de corps, I simply do not understand how implementation of this regulation could be expected to create any increment in similarity of appearance among members of a uniformed police force. While the regulation prohibits hair below the ears or the collar and limits the length of sideburns, it allows the maintenance of any type of hairstyle, other than a ponytail. Thus, as long as their hair does not go below their collars, two police officers, one with an "Afro" hair style and the other with a crewcut could both be in full compliance with the regulation.[7] *256 The Court cautions us not to view the hair-length regulation in isolation, but rather to examine it "in the context of the county's chosen mode of organization for its police force." Ante, at 247. While the Court's caution is well taken, one should also keep in mind, as I fear the Court does not, that what is ultimately under scrutiny is neither the overall structure of the police force nor the uniform and equipment requirements to which its members are subject, but rather the regulation which dictates acceptable hair lengths. The fact that the uniform requirement, for instance, may be rationally related to the goals of increasing police officer "identifiability" and the maintenance of esprit de corps does absolutely nothing to establish the legitimacy of the hair-length regulation. I see no connection between the regulation and the offered rationales[8] and would accordingly affirm the judgment of the Court of Appeals. |
Justice Scalia | dissenting | false | Camps Newfound/Owatonna, Inc. v. Town of Harrison | 1997-05-19T00:00:00 | null | https://www.courtlistener.com/opinion/118111/camps-newfoundowatonna-inc-v-town-of-harrison/ | https://www.courtlistener.com/api/rest/v3/clusters/118111/ | 1,997 | 1996-055 | 2 | 5 | 4 | The Court's negative Commerce Clause jurisprudence has drifted far from its moorings. Originally designed to create a national market for commercial activity, it is today invoked to prevent a State from giving a tax break to charities that benefit the State's inhabitants. In my view, Maine's tax exemption, which excuses from taxation only that property *596 used to relieve the State of its burden of caring for its residents, survives even our most demanding Commerce Clause scrutiny.
I
We have often said that the purpose of our negative Commerce Clause jurisprudence is to create a national market. As Justice Jackson once observed, the "vision of the Founders" was "that every farmer and every craftsman shall be encouraged to produce by the certainty that he will have free access to every market in the Nation, that no home embargoes will withhold his exports, and no foreign state will by customs duties or regulations exclude them." H. P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 539 (1949). In our zeal to advance this policy, however, we must take care not to overstep our mandate, for the Commerce Clause was not intended "to cut the States off from legislating on all subjects relating to the health, life, and safety of their citizens, though the legislation might indirectly affect the commerce of the country." Huron Portland Cement Co. v. Detroit, 362 U.S. 440, 443-444 (1960).
Our cases have struggled (to put it nicely) to develop a set of rules by which we may preserve a national market without needlessly intruding upon the States' police powers, each exercise of which no doubt has some effect on the commerce of the Nation. See Oklahoma Tax Comm'n v. Jefferson Lines, Inc., 514 U.S. 175, 180-183 (1995). The rules that we currently use can be simply stated, if not simply applied: Where a state law facially discriminates against interstate commerce, we observe what has sometimes been referred to as a "virtually per se rule of invalidity;" where, on the other hand, a state law is nondiscriminatory, but nonetheless adversely affects interstate commerce, we employ a deferential "balancing test," under which the law will be sustained unless "the burden imposed on [interstate] commerce is clearly excessive in relation to the putative local benefits," Pike v. Bruce Church, Inc., 397 U.S. 137, 142 (1970). See Oregon *597 Waste Systems, Inc. v. Department of Environmental Quality of Ore., 511 U.S. 93, 99 (1994).
While the "virtually per se rule of invalidity" entails application of the "strictest scrutiny," Hughes v. Oklahoma, 441 U.S. 322, 337 (1979), it does not necessarily result in the invalidation of facially discriminatory state legislation, see, e. g., Maine v. Taylor, 477 U.S. 131 (1986) (upholding absolute ban on the importation of bait fish into Maine), for "what may appear to be a `discriminatory' provision in the constitutionally prohibited sensethat is, a protectionist enactmentmay on closer analysis not be so," New Energy Co. of Ind. v. Limbach, 486 U.S. 269, 278 (1988). Thus, even a statute that erects an absolute barrier to the movement of goods across state lines will be upheld if "the discrimination is demonstrably justified by a valid factor unrelated to economic protectionism," id., at 274, or to put a finer point on it, if the state law "advances a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory alternatives," id., at 278.
In addition to laws that employ suspect means as a necessary expedient to the advancement of legitimate state ends, we have also preserved from judicial invalidation laws that confer advantages upon the State's residents but do so without regulating interstate commerce. We have therefore excepted the State from scrutiny when it participates in markets rather than regulates themby selling cement, for example, see Reeves, Inc. v. Stake, 447 U.S. 429 (1980), or purchasing auto hulks, see Hughes v. Alexandria Scrap Corp., 426 U.S. 794 (1976), or hiring contractors, see White v. Massachusetts Council of Constr. Employers, Inc., 460 U.S. 204 (1983). Likewise, we have said that direct subsidies to domestic industry do not run afoul of the Commerce Clause. See New Energy Co., supra, at 278. In sum, we have declared that "[t]he Commerce Clause does not prohibit all state action designed to give its residents an advantage in the marketplace, but only action of that description in con- *598 nection with the State's regulation of interstate commerce. " Ibid. (emphasis in original).
II
In applying the foregoing principles to the case before us, it is of course important to understand the precise scope of the exemption created by Me. Rev. Stat. Ann., Tit. 36, § 652(1)(A) (Supp. 1996-1997). The Court's analysis suffers from the misapprehension that § 652(1)(A) "sweeps to cover broad swathes of the nonprofit sector," ante, at 594, including nonprofit corporations engaged in quintessentially commercial activities. That is not so. A review of Maine law demonstrates that the provision at issue here is a narrow tax exemption, designed merely to compensate or subsidize those organizations that contribute to the public fisc by dispensing public benefits the State might otherwise provide.
Although Maine allows nonprofit corporations to be organized "for any lawful purpose," Me. Rev. Stat. Ann., Tit. 13B, § 201 (1981 and Supp. 1996-1997), the exemption supplied by § 652(1)(A) does not extend to all nonprofit organizations, but only to those "benevolent and charitable institutions," § 652(1)(A), which are "organized and conducted exclusively for benevolent and charitable purposes," § 652(1)(C)(1) (emphasis added), and only to those parcels of real property and items of personal property that are used "solely," § 652(1)(A), "to further the organization's charitable purposes," Poland v. Poland Springs Health Institute, Inc., 649 A.2d 1098, 1100 (Me. 1994). The Maine Supreme Judicial Court has defined the statutory term "benevolent and charitable institutions" to include only those nonprofits that dispense "charity," which is in turn defined to include only those acts which are
"`for the benefit of an indefinite number of persons, either by bringing their minds or hearts under the influence of education or religion, by relieving their bodies from disease, suffering, or constraint, by assisting them *599 to establish themselves in life, or by erecting or maintaining public buildings or works or otherwise lessening the burdens of government. ` " Lewiston v. Marcotte Congregate Housing, Inc., 673 A.2d 209, 211 (1996) (emphasis added).
Moreover, the Maine Supreme Judicial Court has further limited the § 652(1)(A) exemption by insisting that the party claiming its benefit "bring its claim unmistakably within the spirit and intent of the act creating the exemption," ibid. (internal quotation marks omitted), and by proclaiming that the spirit and intent of § 652(1)(A) is to compensate charitable organizations for their contribution to the public fisc. As the court has explained:
"`[A]ny institution which by its charitable activities relieves the government of part of [its] burden is conferring a pecuniary benefit upon the body politic, and in receiving exemption from taxation it is merely being given a "quid pro quo" for its services in providing something which otherwise the government would have to provide.' " Episcopal Camp Foundation, Inc. v. Hope, 666 A.2d 108, 110 (1995) (quoting Young Men's Christian Assn. of Germantown v. Philadelphia, 323 Pa. 401, 413, 187 A. 204, 210 (1936)).
Thus, § 652(1)(A) exemptions have been denied to organizations that do not provide substantial public benefits, as defined by reference to the state public policy. In one case, for example, an organization devoted to maintaining a wildlife sanctuary was denied exemption on the ground that the preserve's prohibition on deer hunting conflicted with state policy on game management, so that the preserve could not be deemed to provide a public benefit. See Holbrook Island Sanctuary v. Brooksville, 214 A.2d 660 (Me. 1965). Even churches have been denied exemptions, see Pentecostal Assembly of Bangor v. Maidlow, 414 A.2d 891, 893-894 *600 (Me. 1980) ("religious purposes are not to be equated with benevolent and charitable purposes").
The Maine Supreme Judicial Court has adhered rigorously to the requirement that the exempt property be used "solely" for charitable purposes. Even when there is no question that the organization owning the property is devoted exclusively to charitable purposes, the entire exemption will be forfeited if even a small fraction of the property is not used in furtherance of those purposes. See Lewiston, supra, at 212-213 (denying exemption to a building 18 percent of which was leased at market rates); Nature Conservancy of Pine Tree State, Inc. v. Bristol, 385 A.2d 39, 43 (1978) (denying exemption to a nature preserve on which the grantors had reserved rights-of-way).
That § 652(1)(A) serves to compensate private charities for helping to relieve the State of its burden of caring for its residents should not be obscured by the fact that this particular case involves a summer camp rather than a more traditional form of social service. The statute that the Court strikes down does not speak of "camps" at all, but rather lists as examples of "benevolent and charitable institutions" nonprofit nursing homes, boarding homes, community mental health service facilities, and child care centers, see § 652(1)(A). Some summer camps fall within the exemption under a 1933 decision of the Supreme Judicial Court which applied it to a tuition-free camp for indigent children, see Camp Emoh Associates v. Inhabitants of Lyman, 166 A. 59, 60, and under a recent 4-to-3 decision which relied heavily on the fact that the camp at issue provided "moral instruction" and training in "social living and civic responsibility," and was not only "nonprofit" but furnished its camping services below cost, see Episcopal Camp Foundation, supra, at 109, 111. What is at issue in this case is not whether a summer camp can properly be regarded as relieving the State of social costs, but rather whether, assuming it can, a distinction between charities serving mainly residents and *601 charities operated principally for the benefit of nonresidents is constitutional.[1]
III
I turn next to the validity of this focused tax exemption applicable only to property used solely for charitable purposes by organizations devoted exclusively to charityunder the negative Commerce Clause principles discussed earlier. The Court readily concludes that, by limiting the class of eligible property to that which is used "principally for the benefit of persons who are Maine residents," the statute "facially discriminates" against interstate commerce. That seems to me not necessarily true. Disparate treatment constitutes discrimination only if the objects of the disparate treatment are, for the relevant purposes, similarly situated. See General Motors Corp. v. Tracy, 519 U.S. 278, 298-299 *602 (1997). And for purposes of entitlement to a tax subsidy from the State, it is certainly reasonable to think that property gratuitously devoted to relieving the State of some of its welfare burden is not similarly situated to property used "principally for the benefit of persons who are not residents of [the State]," § 652(1)(A). As we have seen, the theory underlying the exemption is that it is a quid pro quo for uncompensated expenditures that lessen the State's burden of providing assistance to its residents.
The Court seeks to establish "facial discrimination" by showing that the effect of treating disparate property disparately is to produce higher costs for those users of the property who come from out of State. But that could be regarded as an indirect effect upon interstate commerce produced by a tax scheme that is not facially discriminatory, which means that the proper mode of analysis would be the more lenient "balancing" standard discussed above. We follow precisely this mode of analysis in Tracy, upholding an Ohio law that provides preferential tax treatment to domestic public utilities. Such entities, we conclude, are not "similarly situated" to other fuel distributors; their insulation from out-of-state competition does not violate the negative Commerce Clause because it "serves important interests in health and safety." 519 U.S., at 306. The Court in Tracy paints a compelling image of people shivering in their homes in the dead of winter without the assured service that competition-sheltered public utilities provide. See id., at 301-302, 306. No less important, however, is the availability of many of the benefits provided by Maine's private charities and facilitated not by total insulation from competition but by favorable tax treatment: care for the sick and dying, for example, or nursing services for the elderly.
Even if, however, the Maine statute displays "facial discrimination" against interstate commerce, that is not the end of the analysis. The most remarkable thing about today's judgment is that it is rendered without inquiry into whether the purposes of the tax exemption justify its favoritism. *603 Once having concluded that the statute is facially discriminatory, the Court rests. "[T]he Town," it asserts, "has made no effort to defend the statute under the per se rule." Ante, at 582. This seems to me a pointless technicality. The town of Harrison (Town) has asserted that the State's interest in encouraging private entities to shoulder part of its socialwelfare burden validates this provision under the negative Commerce Clause. Whether it does so because the presence of that interest causes the resident-benefiting charities not to be "similarly situated" to the non-resident-benefiting charities, and hence negates "facial discrimination," or rather because the presence of that interest justifies "facial discrimination," is a question that is not only of no consequence but is also probably unanswerable. To strike down this statute because the Town's lawyers put the argument in one form rather than the other is truly senseless.[2]
If the Court were to proceed with that further analysis it would have to conclude, in my view, that this is one of those cases in which the "virtually per se rule of invalidity" does not apply. Facially discriminatory or not, the exemption is no more an artifice of economic protectionism than any state law which dispenses public assistance only to the State's residents.[3] Our cases have always recognized the legitimacy of *604 limiting state-provided welfare benefits to bona fide residents. As Justice Stevens once wrote for a unanimous Court: "Neither the overnight visitor, the unfriendly agent of a hostile power, the resident diplomat, nor the illegal entrant, can advance even a colorable claim to a share in the bounty that a conscientious sovereign makes available to its own citizens." Mathews v. Diaz, 426 U.S. 67, 80 (1976). States have restricted public assistance to their own bona fide residents since colonial times, see, M. Ierley, With Charity For All, Welfare and Society, Ancient Times to the Present 41 (1984), and such self-interested behavior (or, put more benignly, application of the principle that charity begins at home) is inherent in the very structure of our federal system, cf. Edgar v. MITE Corp., 457 U.S. 624, 644 (1982) ("[T]he State has no legitimate interest in protecting nonresident[s]"). We have therefore upheld against equal protection challenge continuing residency requirements for municipal employment, see McCarthy v. Philadelphia Civil Serv. Comm'n, 424 U.S. 645 (1976) (per curiam), and bona fide *605 residency requirements for free primary and secondary schooling, see Martinez v. Bynum, 461 U.S. 321 (1983).
If the negative Commerce Clause requires the invalidation of a law such as § 652(1)(A), as a logical matter it also requires invalidation of the laws involved in those cases. After all, the Court today relies not on any discrimination against out-of-state nonprofits, but on the supposed discrimination against nonresident would-be recipients of charity (the nonprofits' "customers"); surely those individuals are similarly discriminated against in the direct distribution of state benefits. The problem, of course, is not limited to municipal employment and free public schooling, but extends also to libraries, orphanages, homeless shelters, and refuges for battered women. One could hardly explain the constitutionality of a State's limiting its provision of these to its own residents on the theory that the State is a "market participant." These are traditional governmental functions, far removed from commercial activity and utterly unconnected to any genuine private market.
If, however, a State that provides social services directly may limit its largesse to its own residents, I see no reason why a State that chooses to provide some of its social services indirectlyby compensating or subsidizing private charitable providerscannot be similarly restrictive.[4] In fact, we have already approved it. In Board of Ed. of Ky. Annual Conference of Methodist Episcopal Church v. Illinois, 203 U.S. 553 (1906), we upheld a state law providing an inheritance *606 tax exemption to in-state charities but denying a similar exemption to out-of-state charities. We recognized that such exemptions are nothing but compensation to private organizations for their assistance in alleviating the State's burden of caring for its less fortunate residents, see id., at 561. "[I]t cannot be said," we wrote, "that if a State exempts property bequeathed for charitable or educational purposes from taxation it is unreasonable or arbitrary to require the charity to be exercised or the education to be bestowed within her borders and for her people," id., at 563.[5]
It is true that the opinion in Board of Ed. of Ky. addressed only the Equal Protection and Privileges and Immunities Clauses of the Fourteenth Amendment, and not the Commerce Clause. A Commerce Clause argument was unquestionably raised by the plaintiff in error, however, in both brief, see Brief for Plaintiff in Error, D. T. 1906, No. 103, pp. 30-38, and oral argument, see 203 U.S., at 555 (argument of counsel), and the Court could not have reached the disposition it did without rejecting it. "[T]he Court implicitly rejected [the] argumen[t] . . . by refusing to address [it]." Clemons v. Mississippi, 494 U.S. 738, 747-748, n. 3 (1990). The Commerce Clause objection went undiscussed, I think, because it was (as it is here) utterly contrived: The State's *607 legislated distinction between charity "bestowed within her borders and for her people" and charity bestowed elsewhere or for others did not implicate commerce at all, except to the indirect and permissible extent that innumerable state laws do.
Finally, even if Maine's property tax exemption for local charities constituted facial discrimination against out-ofstate commerce, and even if its policy justification (unrelated to economic protectionism) were insufficient to survive our "virtually per se rule of invalidity," cf. Maine v. Taylor, 477 U.S. 131 (1986), there would remain the question whether we should not recognize an additional exception to the negative Commerce Clause, as we have in Tracy. As that case explains, just as a public health justification unrelated to economic protectionism may justify an overt discrimination against goods moving in interstate commerce, "so may health and safety considerations be weighed in the process of deciding the threshold question whether the conditions entailing application of the dormant Commerce Clause are present." 519 U.S., at 307. Today's opinion goes to great length to reject the Town's contention that Maine's property tax exemption does not fall squarely within either the "market participant" or "subsidy" exceptions to the negative Commerce Clause, but never stops to ask whether those exceptions are the only ones that may apply. As we explicitly acknowledge in Tracy which effectively creates what might be called a "public utilities" exception to the negative Commerce Clausethe "subsidy" and "market participant" exceptions do not exhaust the realm of state actions that we should abstain from scrutinizing under the Commerce Clause. In my view, the provision by a State of free public schooling, public assistance, and other forms of social welfare to only (or principally) its own residentswhether it be accomplished directly or by providing tax exemptions, cash, or other property to private organizations that perform the work for the Stateimplicates none of the concerns underlying our *608 negative Commerce Clause jurisprudence. That is, I think, self-evidently true, despite the Court's effort to label the recipients of the State's philanthropy as "customers," or "clientele," see, e. g., ante, at 576. Because § 652(1)(A) clearly serves these purposes and has nothing to do with economic protectionism, I believe that it is beyond scrutiny under the negative Commerce Clause.
* * *
As I have discussed, there are various routes by which the Court could validate the statute at issue here: on the ground that it does not constitute "facial discrimination" against interstate commerce and readily survives the Pike v. Bruce Church balancing test; on the ground that it does constitute "facial discrimination" but is supported by such traditional and important state interests that it survives scrutiny under the "virtually per se rule of invalidity"; or on the ground that there is a "domestic charity" exception (just as there is a "public utility" exception) to the negative Commerce Clause. Whichever route is selected, it seems to me that the quid pro quo exemption at issue here is such a reasonable exercise of the State's taxing power that it is not prohibited by the Commerce Clause in the absence of congressional action. We held as much in Board of Ed. of Ky. and should not overrule that decision.
The State of Maine may have special need for a charitable-exemption limitation of the sort at issue here: Its lands and lakes are attractive to various charities of more densely populated Eastern States, which would (if the limitation did not exist) compel the taxpayers of Maine to subsidize their generosity. But the principle involved in our disapproval of Maine's exemption limitation has broad application elsewhere. A State will be unable, for example, to exempt private schools that serve its citizens from state and local real estate taxes unless it exempts as well private schools attended predominantly or entirely by students from *609 out of State. A State that provides a tax exemption for real property used exclusively for the purpose of feeding the poor must provide an exemption for the facilities of an organization devoted exclusively to feeding the poor in another country. These results may well be in accord with the parable of the Good Samaritan, but they have nothing to do with the Commerce Clause.
I respectfully dissent. | The Court's negative Commerce Clause jurisprudence has drifted far from its moorings. Originally designed to create a national market for commercial activity, it is today invoked to prevent a State from giving a tax break to charities that benefit the State's inhabitants. In my view, Maine's tax exemption, which excuses from taxation only that property *596 used to relieve the State of its burden of caring for its residents, survives even our most demanding Commerce Clause scrutiny. I We have often said that the purpose of our negative Commerce Clause jurisprudence is to create a national market. As Justice Jackson once observed, the "vision of the Founders" was "that every farmer and every craftsman shall be encouraged to produce by the certainty that he will have free access to every market in the Nation, that no home embargoes will withhold his exports, and no foreign state will by customs duties or regulations exclude them." H. P. Hood & Sons, In our zeal to advance this policy, however, we must take care not to overstep our mandate, for the Commerce Clause was not intended "to cut the States off from legislating on all subjects relating to the health, life, and safety of their citizens, though the legislation might indirectly affect the commerce of the country." Huron Portland Cement Our cases have struggled (to put it nicely) to develop a set of rules by which we may preserve a national market without needlessly intruding upon the States' police powers, each exercise of which no doubt has some effect on the commerce of the Nation. See Oklahoma Tax The rules that we currently use can be simply stated, if not simply applied: Where a state law facially discriminates against interstate commerce, we observe what has sometimes been referred to as a "virtually per se rule of invalidity;" where, on the other hand, a state law is nondiscriminatory, but nonetheless adversely affects interstate commerce, we employ a deferential "balancing test," under which the law will be sustained unless "the burden imposed on [interstate] commerce is clearly excessive in relation to the putative local benefits," See Oregon *597 Waste Systems, While the "virtually per se rule of invalidity" entails application of the "strictest scrutiny," it does not necessarily result in the invalidation of facially discriminatory state legislation, see, e. g., for "what may appear to be a `discriminatory' provision in the constitutionally prohibited sensethat is, a protectionist enactmentmay on closer analysis not be so," New Energy of Thus, even a statute that erects an absolute barrier to the movement of goods across state lines will be upheld if "the discrimination is demonstrably justified by a valid factor unrelated to economic protectionism," or to put a finer point on it, if the state law "advances a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory alternatives," at In addition to laws that employ suspect means as a necessary expedient to the advancement of legitimate state ends, we have also preserved from judicial invalidation laws that confer advantages upon the State's residents but do so without regulating interstate commerce. We have therefore excepted the State from scrutiny when it participates in markets rather than regulates themby selling cement, for example, see Reeves, or purchasing auto hulks, see or hiring contractors, see Likewise, we have said that direct subsidies to domestic industry do not run afoul of the Commerce Clause. See New Energy at In sum, we have declared that "[t]he Commerce Clause does not prohibit all state action designed to give its residents an advantage in the marketplace, but only action of that description in con- *598 nection with the State's regulation of interstate commerce. " II In applying the foregoing principles to the case before us, it is of course important to understand the precise scope of the exemption created by Me. Rev. Stat. Ann., Tit. 36, 652(1)(A) (Supp. 16-17). The Court's analysis suffers from the misapprehension that 652(1)(A) "sweeps to cover broad swathes of the nonprofit sector," ante, at 594, including nonprofit corporations engaged in quintessentially commercial activities. That is not so. A review of Maine law demonstrates that the provision at issue here is a narrow tax exemption, designed merely to compensate or subsidize those organizations that contribute to the public fisc by dispensing public benefits the State might otherwise provide. Although Maine allows nonprofit corporations to be organized "for any lawful purpose," Me. Rev. Stat. Ann., Tit. 13B, 201 (1981 and Supp. 16-17), the exemption supplied by 652(1)(A) does not extend to all nonprofit organizations, but only to those "benevolent and charitable institutions," 652(1)(A), which are "organized and conducted exclusively for benevolent and charitable purposes," 652(1)(C)(1) and only to those parcels of real property and items of personal property that are used "solely," 652(1)(A), "to further the organization's charitable purposes," The Maine Supreme Judicial Court has defined the statutory term "benevolent and charitable institutions" to include only those nonprofits that dispense "charity," which is in turn defined to include only those acts which are "`for the benefit of an indefinite number of persons, either by bringing their minds or hearts under the influence of education or religion, by relieving their bodies from disease, suffering, or constraint, by assisting them *5 to establish themselves in life, or by erecting or maintaining public buildings or works or otherwise lessening the burdens of government. ` " (16) Moreover, the Maine Supreme Judicial Court has further limited the 652(1)(A) exemption by insisting that the party claiming its benefit "bring its claim unmistakably within the spirit and intent of the act creating the exemption," and by proclaiming that the spirit and intent of 652(1)(A) is to compensate charitable organizations for their contribution to the public fisc. As the court has explained: "`[A]ny institution which by its charitable activities relieves the government of part of [its] burden is conferring a pecuniary benefit upon the body politic, and in receiving exemption from taxation it is merely being given a "quid pro quo" for its services in providing something which otherwise the government would have to provide.' " Episcopal Camp Thus, 652(1)(A) exemptions have been denied to organizations that do not provide substantial public benefits, as defined by reference to the state public policy. In one case, for example, an organization devoted to maintaining a wildlife sanctuary was denied exemption on the ground that the preserve's prohibition on deer hunting conflicted with state policy on game management, so that the preserve could not be deemed to provide a public benefit. See Holbrook Island Even churches have been denied exemptions, see Pentecostal Assembly of The Maine Supreme Judicial Court has adhered rigorously to the requirement that the exempt property be used "solely" for charitable purposes. Even when there is no question that the organization owning the property is devoted exclusively to charitable purposes, the entire exemption will be forfeited if even a small fraction of the property is not used in furtherance of those purposes. See ; Nature Conservancy of Pine Tree State, That 652(1)(A) serves to compensate private charities for helping to relieve the State of its burden of caring for its residents should not be obscured by the fact that this particular case involves a summer camp rather than a more traditional form of social service. The statute that the Court strikes down does not speak of "camps" at all, but rather lists as examples of "benevolent and charitable institutions" nonprofit nursing homes, boarding homes, community mental health service facilities, and child care centers, see 652(1)(A). Some summer camps fall within the exemption under a 1933 decision of the Supreme Judicial Court which applied it to a tuition-free camp for indigent children, see Camp Emoh and under a recent 4-to-3 decision which relied heavily on the fact that the camp at issue provided "moral instruction" and training in "social living and civic responsibility," and was not only "nonprofit" but furnished its camping services below cost, see Episcopal Camp What is at issue in this case is not whether a summer camp can properly be regarded as relieving the State of social costs, but rather whether, assuming it can, a distinction between charities serving mainly residents and *1 charities operated principally for the benefit of nonresidents is constitutional.[1] III I turn next to the validity of this focused tax exemption applicable only to property used solely for charitable purposes by organizations devoted exclusively to charityunder the negative Commerce Clause principles discussed earlier. The Court readily concludes that, by limiting the class of eligible property to that which is used "principally for the benefit of persons who are Maine residents," the statute "facially discriminates" against interstate commerce. That seems to me not necessarily true. Disparate treatment constitutes discrimination only if the objects of the disparate treatment are, for the relevant purposes, similarly situated. See General Motors 519 U.S. 298-2 *2 (17). And for purposes of entitlement to a tax subsidy from the State, it is certainly reasonable to think that property gratuitously devoted to relieving the State of some of its welfare burden is not similarly situated to property used "principally for the benefit of persons who are not residents of [the State]," 652(1)(A). As we have seen, the theory underlying the exemption is that it is a quid pro quo for uncompensated expenditures that lessen the State's burden of providing assistance to its residents. The Court seeks to establish "facial discrimination" by showing that the effect of treating disparate property disparately is to produce higher costs for those users of the property who come from out of State. But that could be regarded as an indirect effect upon interstate commerce produced by a tax scheme that is not facially discriminatory, which means that the proper mode of analysis would be the more lenient "balancing" standard discussed above. We follow precisely this mode of analysis in Tracy, upholding an Ohio law that provides preferential tax treatment to domestic public utilities. Such entities, we conclude, are not "similarly situated" to other fuel distributors; their insulation from out-of-state competition does not violate the negative Commerce Clause because it "serves important interests in health and safety." The Court in Tracy paints a compelling image of people shivering in their homes in the dead of winter without the assured service that competition-sheltered public utilities provide. See No less important, however, is the availability of many of the benefits provided by Maine's private charities and facilitated not by total insulation from competition but by favorable tax treatment: care for the sick and dying, for example, or nursing services for the elderly. Even if, however, the Maine statute displays "facial discrimination" against interstate commerce, that is not the end of the analysis. The most remarkable thing about today's judgment is that it is rendered without inquiry into whether the purposes of the tax exemption justify its favoritism. *3 Once having concluded that the statute is facially discriminatory, the Court rests. "[T]he Town," it asserts, "has made no effort to defend the statute under the per se rule." Ante, at 582. This seems to me a pointless technicality. The town of Harrison (Town) has asserted that the State's interest in encouraging private entities to shoulder part of its socialwelfare burden validates this provision under the negative Commerce Clause. Whether it does so because the presence of that interest causes the resident-benefiting charities not to be "similarly situated" to the non-resident-benefiting charities, and hence negates "facial discrimination," or rather because the presence of that interest justifies "facial discrimination," is a question that is not only of no consequence but is also probably unanswerable. To strike down this statute because the Town's lawyers put the argument in one form rather than the other is truly senseless.[2] If the Court were to proceed with that further analysis it would have to conclude, in my view, that this is one of those cases in which the "virtually per se rule of invalidity" does not apply. Facially discriminatory or not, the exemption is no more an artifice of economic protectionism than any state law which dispenses public assistance only to the State's residents.[3] Our cases have always recognized the legitimacy of *4 limiting state-provided welfare benefits to bona fide residents. As Justice Stevens once wrote for a unanimous Court: "Neither the overnight visitor, the unfriendly agent of a hostile power, the resident diplomat, nor the illegal entrant, can advance even a colorable claim to a share in the bounty that a conscientious sovereign makes available to its own citizens." States have restricted public assistance to their own bona fide residents since colonial times, see, M. Ierley, With Charity For All, Welfare and Society, Ancient Times to the Present 41 (1984), and such self-interested behavior (or, put more benignly, application of the principle that charity begins at home) is inherent in the very structure of our federal system, cf. We have therefore upheld against equal protection challenge continuing residency requirements for municipal employment, see and bona fide *5 residency requirements for free primary and secondary schooling, see If the negative Commerce Clause requires the invalidation of a law such as 652(1)(A), as a logical matter it also requires invalidation of the laws involved in those cases. After all, the Court today relies not on any discrimination against out-of-state nonprofits, but on the supposed discrimination against nonresident would-be recipients of charity (the nonprofits' "customers"); surely those individuals are similarly discriminated against in the direct distribution of state benefits. The problem, of course, is not limited to municipal employment and free public schooling, but extends also to libraries, orphanages, homeless shelters, and refuges for battered women. One could hardly explain the constitutionality of a State's limiting its provision of these to its own residents on the theory that the State is a "market participant." These are traditional governmental functions, far removed from commercial activity and utterly unconnected to any genuine private market. If, however, a State that provides social services directly may limit its largesse to its own residents, I see no reason why a State that chooses to provide some of its social services indirectlyby compensating or subsidizing private charitable providerscannot be similarly restrictive.[4] In fact, we have already approved it. In Board of Ed. of Ky. Annual Conference of Methodist Episcopal we upheld a state law providing an inheritance *6 tax exemption to in-state charities but denying a similar exemption to out-of-state charities. We recognized that such exemptions are nothing but compensation to private organizations for their assistance in alleviating the State's burden of caring for its less fortunate residents, see "[I]t cannot be said," we wrote, "that if a State exempts property bequeathed for charitable or educational purposes from taxation it is unreasonable or arbitrary to require the charity to be exercised or the education to be bestowed within her borders and for her people,"[5] It is true that the opinion in Board of Ed. of Ky. addressed only the Equal Protection and Privileges and Immunities Clauses of the Fourteenth Amendment, and not the Commerce Clause. A Commerce Clause argument was unquestionably raised by the plaintiff in error, however, in both brief, see Brief for Plaintiff in Error, D. T. 1906, No. 103, pp. 30-38, and oral argument, see and the Court could not have reached the disposition it did without rejecting it. "[T]he Court implicitly rejected [the] argumen[t] by refusing to address [it]." (10). The Commerce Clause objection went undiscussed, I think, because it was (as it is here) utterly contrived: The State's *7 legislated distinction between charity "bestowed within her borders and for her people" and charity bestowed elsewhere or for others did not implicate commerce at all, except to the indirect and permissible extent that innumerable state laws do. Finally, even if Maine's property tax exemption for local charities constituted facial discrimination against out-ofstate commerce, and even if its policy justification (unrelated to economic protectionism) were insufficient to survive our "virtually per se rule of invalidity," cf. there would remain the question whether we should not recognize an additional exception to the negative Commerce Clause, as we have in Tracy. As that case explains, just as a public health justification unrelated to economic protectionism may justify an overt discrimination against goods moving in interstate commerce, "so may health and safety considerations be weighed in the process of deciding the threshold question whether the conditions entailing application of the dormant Commerce Clause are present." Today's opinion goes to great length to reject the Town's contention that Maine's property tax exemption does not fall squarely within either the "market participant" or "subsidy" exceptions to the negative Commerce Clause, but never stops to ask whether those exceptions are the only ones that may apply. As we explicitly acknowledge in Tracy which effectively creates what might be called a "public utilities" exception to the negative Commerce Clausethe "subsidy" and "market participant" exceptions do not exhaust the realm of state actions that we should abstain from scrutinizing under the Commerce Clause. In my view, the provision by a State of free public schooling, public assistance, and other forms of social welfare to only (or principally) its own residentswhether it be accomplished directly or by providing tax exemptions, cash, or other property to private organizations that perform the work for the Stateimplicates none of the concerns underlying our *8 negative Commerce Clause jurisprudence. That is, I think, self-evidently true, despite the Court's effort to label the recipients of the State's philanthropy as "customers," or "clientele," see, e. g., ante, at 576. Because 652(1)(A) clearly serves these purposes and has nothing to do with economic protectionism, I believe that it is beyond scrutiny under the negative Commerce Clause. * * * As I have discussed, there are various routes by which the Court could validate the statute at issue here: on the ground that it does not constitute "facial discrimination" against interstate commerce and readily survives the Pike v. Bruce Church balancing test; on the ground that it does constitute "facial discrimination" but is supported by such traditional and important state interests that it survives scrutiny under the "virtually per se rule of invalidity"; or on the ground that there is a "domestic charity" exception (just as there is a "public utility" exception) to the negative Commerce Clause. Whichever route is selected, it seems to me that the quid pro quo exemption at issue here is such a reasonable exercise of the State's taxing power that it is not prohibited by the Commerce Clause in the absence of congressional action. We held as much in Board of Ed. of Ky. and should not overrule that decision. The State of Maine may have special need for a charitable-exemption limitation of the sort at issue here: Its lands and lakes are attractive to various charities of more densely populated Eastern States, which would (if the limitation did not exist) compel the taxpayers of Maine to subsidize their generosity. But the principle involved in our disapproval of Maine's exemption limitation has broad application elsewhere. A State will be unable, for example, to exempt private schools that serve its citizens from state and local real estate taxes unless it exempts as well private schools attended predominantly or entirely by students from *9 out of State. A State that provides a tax exemption for real property used exclusively for the purpose of feeding the poor must provide an exemption for the facilities of an organization devoted exclusively to feeding the poor in another country. These results may well be in accord with the parable of the Good Samaritan, but they have nothing to do with the Commerce Clause. I respectfully dissent. |
Justice Brennan | majority | false | United States v. Rodgers | 1983-05-31T00:00:00 | null | https://www.courtlistener.com/opinion/110942/united-states-v-rodgers/ | https://www.courtlistener.com/api/rest/v3/clusters/110942/ | 1,983 | 1982-088 | 2 | 5 | 4 | These consolidated cases involve the relationship between the imperatives of federal tax collection and rights accorded by state property laws. Section 7403 of the Internal Revenue Code of 1954, 26 U.S. C. § 7403 (1976 ed. and Supp. V), authorizes the judicial sale of certain properties to satisfy the tax indebtedness of delinquent taxpayers. The issue in both cases is whether § 7403 empowers a federal district court to order the sale of a family home in which a delinquent taxpayer had an interest at the time he incurred his indebtedness, but in which the taxpayer's spouse, who does not owe any of that indebtedness, also has a separate "homestead" right as defined by Texas law. We hold that the statute does grant power to order the sale, but that its exercise is limited to some degree by equitable discretion. We also hold that, if the home is sold, the nondelinquent spouse is entitled, as part of the distribution of proceeds required under § 7403, to so much of the proceeds as represents complete compensation for the loss of the homestead estate.
I
A
Section 7403 provides in full as follows:
"(a) Filing. In any case where there has been a refusal or neglect to pay any tax, or to discharge any liability in respect thereof, whether or not levy has been made, the Attorney General or his delegate, at the request of the Secretary [of the Treasury], may direct a civil action to be filed in a district court of the United States to enforce the lien of the United States under this title with respect to such tax or liability or to subject any *681 property, of whatever nature, of the delinquent, or in which he has any right, title, or interest, to the payment of such tax or liability. For purposes of the preceding sentence, any acceleration of payment under section 6166(g) shall be treated as a neglect to pay tax.
"(b) Parties. All persons having liens upon or claiming any interest in the property involved in such action shall be made parties thereto.
"(c) Adjudication and decree. The court shall, after the parties have been duly notified of the action, proceed to adjudicate all matters involved therein and finally determine the merits of all claims to and liens upon the property, and, in all cases where a claim or interest of the United States therein is established, may decree a sale of such property, by the proper officer of the court, and a distribution of the proceeds of such sale according to the findings of the court in respect to the interests of the parties and of the United States. If the property is sold to satisfy a first lien held by the United States, the United States may bid at the sale such sum, not exceeding the amount of such lien with expenses of sale, as the Secretary directs.
"(d) Receivership. In any such proceeding, at the instance of the United States, the court may appoint a receiver to enforce the lien, or, upon certification by the Secretary during the pendency of such proceedings that it is in the public interest, may appoint a receiver with all the powers of a receiver in equity."
As a general matter,[1] the "lien of the United States" referred to in § 7403(a) is that created by 26 U.S. C. § 6321, which provides:
"If any person liable to pay any tax neglects or refuses to pay the same after demand, the amount (including any *682 interest, additional amount, addition to tax, or assessable penalty, together with any costs that may accrue in addition thereto) shall be a lien in favor of the United States upon all property and rights to property, whether real or personal, belonging to such person."[2]
Section 7403, whose basic elements go back to revenue legislation passed in 1868 (§ 106 of the Act of July 20, 1868, ch. 186, 15 Stat. 167) is one of a number of distinct enforcement tools available to the United States for the collection of delinquent taxes.[3] The Government may, for example, simply sue for the unpaid amount, and, on getting a judgment, exercise the usual rights of a judgment creditor. See 26 U.S. C. §§ 6502(a), 7401, 7402(a). Yet a third route is administrative levy under 26 U.S. C. § 6331(a), which provides:
"If any person liable to pay any tax neglects or refuses to pay the same within 10 days after notice and demand, it shall be lawful for the Secretary [or his delegate] to collect such tax (and such further sum as shall be sufficient to cover the expenses of the levy) by levy upon all property and rights to property (except such property as is exempt under section 6334) belonging to such person or on which there is a lien provided in this chapter for the payment of such tax . . . ."
Administrative levy, unlike an ordinary lawsuit, and unlike the procedure described in § 7403, does not require any judicial intervention, and it is up to the taxpayer, if he so *683 chooses, to go to court if he claims that the assessed amount was not legally owing. See generally Bull v. United States, 295 U.S. 247, 260 (1935).[4]
The common purpose of this formidable arsenal of collection tools is to ensure the prompt and certain enforcement of the tax laws in a system relying primarily on self-reporting. See G. M. Leasing Corp. v. United States, 429 U.S. 338, 350 (1977); United States v. Security Trust & Savings Bank, 340 U.S. 47, 51 (1950); Bull v. United States, supra, at 259-260.[5] Moreover, it has long been an axiom of our tax collection scheme that, although the definition of underlying property interests is left to state law, the consequences that attach to those interests is a matter left to federal law. See United States v. Mitchell, 403 U.S. 190, 205 (1971) (state law determines income attributable to wife as community property, but state law allowing wife to renounce community rights and obligations not effective as to liability for federal tax); United States v. Union Central Life Insurance Co., 368 U.S. 291, 293-295 (1961) (federal tax lien not subject, even as against good-faith purchaser, to state filing requirements); Aquilino v. United States, 363 U.S. 509, 513-515 (1960), and cases cited (attachment of federal lien depends on whether "property" or "rights to property" exist under state law; priority of federal lien depends on federal law); United States v. Bess, 357 U.S. 51, 56-57 (1958) (once it has been determined that state law has created property interests sufficient for federal tax lien to attach, state law "is inoperative to prevent the attachment" of such liens); Springer v. United States, 102 U.S. 586, 594 (1881) (federal tax sale not subject to state requirement that independent lots be sold separately).
*684 B
The substance of Texas law related to the homestead right may usefully be divided into two categories. Cf. Woods v. Alvarado State Bank, 118 Tex. 586, 590, 19 S.W.2d 35, 35 (1929). First, in common with a large number of States, Texas establishes the family home or place of business[6] as an enclave exempted from the reach of most creditors. Thus, under Tex. Const., Art. 16, § 50:
"The homestead of a family, or of a single adult person, shall be, and is hereby protected from forced sale, for the payment of all debts except for [certain exceptions not relevant here] . . . . No mortgage, trust deed, or other lien on the homestead shall ever be valid, except for [certain exceptions not relevant here]."[7]
Second, in common with a somewhat smaller number of States, Texas gives members of the family unit additional rights in the homestead property itself. Thus, in a clause not included in the above quotation, Tex. Const., Art 16, § 50, also provides that "the owner or claimant of the property *685 claimed as homestead [may not], if married, sell or abandon the homestead without the consent of the other spouse, given in such manner as may be prescribed by law."[8] Equally important, Art. 16, § 52, provides:
"On the death of the husband or wife, or both, the homestead shall descend and vest in like manner as other real property of the deceased, and shall be governed by the same laws of descent and distribution, but it shall not be partitioned among the heirs of the deceased during the lifetime of the surviving husband or wife, or so long as the survivor may elect to use or occupy the same as a homestead, or so long as the guardian of the minor children of the deceased may be permitted, under the order of the proper court having the jurisdiction, to use and occupy the same."[9]
The effect of these provisions in the Texas Constitution is to give each spouse in a marriage a separate and undivided possessory interest in the homestead, which is only lost by death or abandonment, and which may not be compromised either by the other spouse or by his or her heirs.[10] It bears emphasis that the rights accorded by the homestead laws vest independently in each spouse regardless of whether one spouse, or both, actually owns the fee interest in the homestead. Thus, although analogy is somewhat hazardous in *686 this area, it may be said that the homestead laws have the effect of reducing the underlying ownership rights in a homestead property to something akin to remainder interests and vesting in each spouse an interest akin to an undivided life estate in the property. See Williams v. Williams, 569 S.W.2d 867, 869 (Tex. 1978), and cases cited; Paddock v. Siemoneit, 147 Tex. 571, 585, 218 S.W.2d 428, 436 (1949), and cases cited; Hill v. Hill, 623 S.W.2d 779, 780 (Tex. App. 1981), and cases cited. This analogy, although it does some injustice to the nuances present in the Texas homestead statute,[11] also serves to bring to the fore something that has been repeatedly emphasized by the Texas courts, and that was reaffirmed by the Court of Appeals in these cases: that the Texas homestead right is not a mere statutory entitlement, but a vested property right. As the Supreme Court of Texas has put it, a spouse "has a vested estate in the land of which she cannot be divested during her life except by abandonment or a voluntary conveyance in the manner prescribed by law." Paddock v. Siemoneit, supra, at 585, 218 S.W.2d, at 436; see United States v. Rogers, 649 F.2d 1117, 1127 (CA5 1981), and cases cited.[12]
II
The two cases before us were consolidated for oral argument before the United States Court of Appeals for the Fifth Circuit, and resulted in opinions issued on the same day. United States v. Rogers, supra;[13] Ingram v. Dallas Dept. of *687 Housing & Urban Rehabilitation, 649 F.2d 1128 (1981). They arise out of legally comparable, but quite distinct, sets of facts.
A
Lucille Mitzi Bosco Rodgers is the widow of Philip S. Bosco, whom she married in 1937. She and Mr. Bosco acquired, as community property, a residence in Dallas, Texas, and occupied it as their homestead. Subsequently, in 1971 and 1972, the Internal Revenue Service issued assessments totaling more than $900,000 for federal wagering taxes, penalties, and interest, against Philip for the taxable years 1966 through 1971. These taxes remained unpaid at the time of Philip's death in 1974. Since Philip's death, Lucille has continued to occupy the property as her homestead, and now lives there with her present husband.
On September 23, 1977, the Government filed suit under 26 U.S. C. §§ 7402 and 7403 in the United States District Court for the Northern District of Texas against Mrs. Rodgers and Philip's son, daughter, and executor. The suit sought to reduce to judgment the assessments against Philip, to enforce the Government's tax liens, including the one that had attached to Philip's interest in the residence, and to obtain a deficiency judgment in the amount of any unsatisfied part of the liability. On cross-motions for summary judgment, the District Court granted partial summary judgment on, among other things, the defendants' claim that the federal tax liens could not defeat Mrs. Rodgers' state-created right not to have her homestead subjected to a forced sale. Fed. Rule Civ. Proc. 54(b).
The Court of Appeals affirmed on the homestead issue,[14] holding that if "a homestead interest is, under state law, a property right, possessed by the nontaxpayer spouse at the time the lien attaches to the taxpayer spouse's interest, then the federal tax lien may not be foreclosed against the homestead *688 property for as long as the nontaxpayer spouse maintains his or her homestead interest under state law." 649 F.2d, at 1125 (footnotes omitted). The court implied that the Government had the choice of either waiting until Mrs. Rodgers' homestead interest lapsed, or satisfying itself with a forced sale of only Philip Bosco's interest in the property.
B
Joerene Ingram is the divorced wife of Donald Ingram. During their marriage, Joerene and Donald acquired, as community property, a residence in Dallas, Texas, and occupied it as their homestead. Subsequently, in 1972 and 1973, the Internal Revenue Service issued assessments against Donald Ingram relating to unpaid taxes withheld from wages of employees of a company of which he was president. Deducting payments made on account of these liabilities, there remains unpaid approximately $9,000, plus interest. In addition, in 1973, the Service made an assessment against both Donald and Joerene in the amount of $283.33, plus interest, relating to their joint income tax liability for 1971. These amounts also remain unpaid.
In March 1975, at about the time the Ingrams were seeking a divorce, their residence was destroyed by fire. In September 1975, the Ingrams obtained a divorce. In connection with the divorce, they entered into a property settlement agreement, one provision of which was that Donald would convey to Joerene his interest in the real property involved in this case in exchange for $1,500, to be paid from the proceeds of the sale of the property. Joerene tried to sell the property, through a trustee, but was unsuccessful in those efforts, apparently because of the federal tax liens encumbering the property. To make matters worse, she then received notice from the City of Dallas Department of Housing and Urban Rehabilitation (Department) that unless she complied with local ordinances, the remains of the fire-damaged *689 residence would be demolished. Following a hearing, the Department issued a final notice and a work order to demolish. Joerene Ingram and the trustee then filed suit in Texas state court to quiet title to the property, to remove the federal tax liens, and to enjoin demolition. The defendants were the United States, the Department, and several creditors claiming an interest in the property.
The United States removed the suit to the District Court for the Northern District of Texas. It then filed a counterclaim against Joerene Ingram and Donald Ingram (who was added as a defendant on the counterclaim) for both the unpaid withholding taxes and the joint liability for unpaid income taxes. In its prayer for relief, the Government sought, among other things, judicial sale of the property under § 7403. Pursuant to a stipulation of the parties, the property was sold unencumbered and the proceeds (approximately $16,250) were deposited into the registry of the District Court pending the outcome of the suit. The parties agreed that their rights, claims, and priorities would be determined as if the sale had not taken place, and that the proceeds would be divided according to their respective interests. On cross-motions for summary judgment, the District Court granted summary judgment on the Government's counterclaims.
The Court of Appeals affirmed in part, and reversed and remanded in part. It agreed that the Government could foreclose its lien on the proceeds from the sale of the property to collect the $283.33, plus interest, for the unpaid income tax owed by Joerene and Donald Ingram jointly. Applying its decision in Rodgers, however, it also held that the Government could not reach the proceeds of the sale of the property to collect the individual liability of Donald Ingram, assuming Joerene Ingram had maintained her homestead interest in the property. The court remanded, however, for a factual determination of whether Joerene had "abandoned" the *690 homestead by dividing the insurance proceeds with Donald and by attempting even before the stipulation entered into with the Government to sell the property and divide the proceeds of that sale with Donald.[15]
C
The Government filed a single petition for certiorari in both these cases. See this Court's Rule 19.4. We granted certiorari, 456 U.S. 904 (1982), in order to resolve a conflict among the Courts of Appeals as to the proper interpretation of § 7403.
III
A
The basic holding underlying the Court of Appeals' view that the Government was not authorized to seek a sale of the homes in which respondents held a homestead interest is that "when a delinquent taxpayer shares his ownership interest in property jointly with other persons rather than being the sole owner, his `property' and `rights to property' to which the federal tax lien attaches under 26 U.S. C. § 6321, and on which federal levy may be had under 26 U.S. C. § 7403(a), involve only his interest in the property, and not the entire property." 649 F.2d, at 1125 (emphasis in original). According to the Court of Appeals, this principle applies, not only in the homestead context, but in any cotenancy in which unindebted third parties share an ownership interest with a delinquent taxpayer. See Folsom v. United States, 306 F.2d 361 (CA5 1962).
We agree with the Court of Appeals that the Government's lien under § 6321 cannot extend beyond the property interests *691 held by the delinquent taxpayer.[16] We also agree that the Government may not ultimately collect, as satisfaction for the indebtedness owed to it, more than the value of the property interests that are actually liable for that debt. But, in this context at least, the right to collect and the right to seek a forced sale are two quite different things.
The Court of Appeals for the Fifth Circuit recognized that it was the only Court of Appeals that had adopted the view that the Government could seek the sale, under § 7403, of only the delinquent taxpayer's "interest in the property, and not the entire property." 649 F.2d, at 1125, and n. 12. We agree with the prevailing view that such a restrictive reading of § 7403 flies in the face of the plain meaning of the statute. See, e. g., United States v. Trilling, 328 F.2d 699, 702-703 (CA7 1964); Washington v. United States, 402 F.2d 3, 6-7 (CA4 1968); United States v. Overman, 424 F.2d 1142, 1146 (CA9 1970); United States v. Kocher, 468 F.2d 503, 506-507 (CA2 1972); see also Mansfield v. Excelsior Refining Co., 135 U.S. 326, 339-341 (1890).[17]
*692 Section 7403(a) provides, not only that the Government may "enforce [its] lien," but also that it may seek to "subject any property, of whatever nature, of the delinquent, or in which he has any right, title, or interest, to the payment of such tax or liability" (emphasis added). This clause in and of itself defeats the reading proposed by the Court of Appeals.[18]*693 Section 7403(b) then provides that "[a]ll persons having liens upon or claiming any interest in the property involved in such action shall be made parties thereto" (emphasis added). Obviously, no joinder of persons claiming independent interests in the property would be necessary if the Government were only authorized to seek the sale of the delinquent taxpayer's own interests. Finally, § 7403(c) provides that the district court should "determine the merits of all claims to and liens upon the property, and, in all cases where a claim or interest of the United States therein is established, may decree a sale of such property . . . and a distribution of the proceeds of such sale according to the findings of the court in respect to the interests of the parties and of the United States" (emphasis added). Again, we must read the statute *694 to contemplate, not merely the sale of the delinquent taxpayer's own interest, but the sale of the entire property (as long as the United States has any "claim or interest" in it), and the recognition of third-party interests through the mechanism of judicial valuation and distribution.
Our reading of § 7403 is consistent with the policy inherent in the tax statutes in favor of the prompt and certain collection of delinquent taxes. See supra, at 683. It requires no citation to point out that interests in property, when sold separately, may be worth either significantly more or significantly less than the sum of their parts. When the latter is the case, it makes considerable sense to allow the Government to seek the sale of the whole, and obtain its fair share of the proceeds, rather than satisfy itself with a mere sale of the part.
Our reading is also supported by an examination of the historical background against which the predecessor statute to § 7403 was enacted. In 1868, as today, state taxation consisted in large part of ad valorem taxation on real property. In enforcing such taxes against delinquent taxpayers, one usual remedy was a sale by the State of the assessed property. The prevailing although admittedly not universal view was that such sales were in rem proceedings, and that the title that was created in the sale extinguished not only the interests of the person liable to pay the tax, but also any other interests that had attached to the property, even if the owners of such interests could not otherwise be held liable for the tax. See generally H. Black, Law of Tax Titles §§ 231-236 (1888); W. Burroughs, Law of Taxation § 122 (1877). Where in rem proceedings were the rule, they were generally held to cut off as well dower or homestead rights possessed by the delinquent taxpayer's spouse. See Lucas v. Purdy, 142 Iowa 359, 120 N.W. 1063 (1909); Robbins v. Barron, 32 Mich. 36 (1875); Jones v. Devore, 8 Ohio St. 430 (1858); Black 299; Burroughs 348. But cf. R. Blackwell, Power to Sell Land for the Non-Payment of Taxes 550 (3d ed. 1869).
*695 One evident purpose of the federal judicial sale provision enacted in 1868 was to obtain for the federal tax collector some of the advantages that many States enjoyed through in rem tax enforcement. As one commentator has put it, echoing almost exactly the usual description of state in rem proceedings, the § 7403 proceeding
"from its very nature, is a proceeding in rem. The purchaser receives a complete new title and not just somebody's interest. The court finds the state of the title to the real estate in question, orders it sold if the United States has a lien on it, and divides the proceeds accordingly. All prior interests are cut off and the title starts over again in the new purchaser." Rogge, The Tax Lien of the United States, 13 A. B. A. J. 576, 577 (1927).
See also G. Holmes, Federal Income Tax 546-547 (1920).
Even as it gave the Government the right to seek an undivided sale in an in rem proceeding, however, the predecessor to § 7403 departed quite sharply from the model provided by the States by guaranteeing that third parties with an interest in the property receive a share of the proceeds commensurate with the value of their interests. This apparently unique provision was prompted, we can assume, by the sense that, precisely because the federal taxes involved were not taxes on the real property being sold, simple justice required significantly greater solicitude for third parties than was generally available in state in rem proceedings.[19]
Finally, our reading of the statute is significantly bolstered by a comparison with the statutory language setting out the administrative levy remedy also available to the Government.[20]*696 Under 26 U.S. C. § 6331(a), the Government may sell for the collection of unpaid taxes all nonexempt "property and rights to property . . . belonging to such person [i. e., the delinquent taxpayer] or on which there is a lien provided in this chapter for the payment of such tax" (emphasis added). This language clearly embodies the limitation that the Court of Appeals thought was present in § 7403, and it has been so interpreted by the courts.[21] Section 6331, unlike § 7403, does not require notice and hearing for third parties, because no rights of third parties are intended to be implicated by § 6331. Indeed, third parties whose property or interests in property have been seized inadvertently are entitled to claim that the property has been "wrongfully levied upon," and may apply for its return either through administrative channels, 26 U.S. C. § 6343(b), or through a civil action filed in a federal district court, § 7426(a)(1); see §§ 7426(b)(1), 7426(b)(2)(A).[22] In the absence of such "wrongful levy," the entire proceeds of a sale conducted pursuant to administrative levy may be applied, without any prior distribution of the sort required by § 7403, to the expenses of the levy and sale, the specific tax liability on the seized property, and the general tax liability of the delinquent taxpayer. 26 U.S. C. § 6342.
We are not entirely unmoved by the force of the basic intuition underlying the Court of Appeals' view of § 7403 that the Government, though it has the "right to pursue the property *697 of the [delinquent] taxpayer with all the force and fury at its command," should not have any right, superior to that of other creditors, to disturb the settled expectations of innocent third parties. Folsom v. United States, 306 F. 2d, at 367-368. In fact, however, the Government's right to seek a forced sale of the entire property in which a delinquent taxpayer had an interest does not arise out of its privileges as an ordinary creditor, but out of the express terms of § 7403. Moreover, the use of the power granted by § 7403 is not the act of an ordinary creditor, but the exercise of a sovereign prerogative, incident to the power to enforce the obligations of the delinquent taxpayer himself, and ultimately grounded in the constitutional mandate to "lay and collect taxes."[23] Cf. Bull v. United States, 295 U. S., at 259-260; Phillips v. Commissioner, 283 U.S. 589, 595-597 (1931); United States v. Snyder, 149 U.S. 210, 214-215 (1893).
Admittedly, if § 7403 allowed for the gratuitous confiscation of one person's property interests in order to satisfy another person's tax indebtedness, such a provision might pose significant difficulties under the Due Process Clause of the Fifth Amendment.[24] But, as we have already indicated, § 7403 makes no further use of third-party property interests than to facilitate the extraction of value from those concurrent property interests that are properly liable for the taxpayer's debt. To the extent that third-party property interests are "taken" in the process, § 7403 provides compensation for that "taking" by requiring that the court distribute the proceeds of the sale "according to the findings of the court in respect to the interests of the parties and of the United *698 States." Cf. United States v. Overman, 424 F. 2d, at 1146. Moreover, we hold, on the basis of what we are informed about the nature of the homestead estate in Texas, that it is the sort of property interest for whose loss an innocent third party must be compensated under § 7403. Cf. United States v. General Motors Corp., 323 U.S. 373, 377-378 (1945).[25] We therefore see no contradiction, at least at the level of basic principle, between the enforcement powers granted to the Government under § 7403 and the recognition of vested property interests granted to innocent third parties under state law.
The exact method for the distribution required by § 7403 is not before us at this time. But we can get a rough idea of the practical consequences of the principles we have just set out. For example, if we assume, only for the sake of illustration, that a homestead estate is the exact economic equivalent of a life estate, and that the use of a standard statutory or commercial table and an 8% discount rate is appropriate in calculating the value of that estate, then three nondelinquent surviving or remaining spouses, aged 30, 50, and 70 years, each holding a homestead estate, would be entitled to approximately 97%, 89%, and 64%, respectively, of the proceeds of the sale of their homes as compensation for that *699 estate.[26] In addition, if we assume that each of these hypothetical nondelinquent spouses also has a protected half-interest in the underlying ownership rights to the property being sold,[27] then their total compensation would be approximately 99%, 95%, and 82%, respectively, of the proceeds from such sale.
In sum, the Internal Revenue Code, seen as a whole, contains a number of cumulative collection devices, each with its own advantages and disadvantages for the tax collector. Among the advantages of administrative levy is that it is quick and relatively inexpensive. Among the advantages of a § 7403 proceeding is that it gives the Federal Government the opportunity to seek the highest return possible on the forced sale of property interests liable for the payment of federal taxes. The provisions of § 7403 are broad and profound. Nevertheless, § 7403 is punctilious in protecting the vested rights of third parties caught in the Government's collection effort, and in ensuring that the Government not receive out of the proceeds of the sale any more than that to which it is properly entitled. Of course, the exercise in any particular case of the power granted under § 7403 to seek the forced sale of property interests other than those of the delinquent taxpayer is left in the first instance to the good sense and common decency of the collecting authorities. 26 U.S. C. § 7403(a). We also explore in Part IV of this opinion the nature *700 of the limited discretion left to the courts in proceedings brought under § 7403. But that the power exists, and that it is necessary to the prompt and certain enforcement of the tax laws, we have no doubt.
B
There is another, intermeshed but analytically distinguishable, ground advanced by the Court of Appeals and the respondents and reiterated by the dissent for denying the Government the right to seek the forced sale of property held as a homestead by a nondelinquent third party. Taken in itself, this view would hold that, even if § 7403 normally allows for the forced sale of property interests other than those directly liable for the indebtedness of the delinquent taxpayer, the special protections accorded by the exemption aspect of Texas homestead law, see supra, at 685-686, should immunize it from the reach of § 7403.
The Court of Appeals conceded that "the homestead interest of a taxpayer spouse, i. e., that of one who himself has tax liability, clearly cannot by itself defeat [the enforcement under § 7403 of] a federal tax lien." 649 F.2d, at 1121 (emphasis in original); see also 649 F.2d, at 1132 (authorizing levy on proceeds in Ingram case to the extent of the $283.33 liability jointly owed by Mr. and Mrs. Ingram). This proposition, although not explicit in the Code, is clearly implicit in 26 U.S. C. § 6334(c) (relating to exemptions from levy),[28] and in our decisions in United States v. Mitchell, 403 U. S., at 204-205; Aquilino v. United States, 363 U. S., at 513-514; and United States v. Bess, 357 U. S., at 56-57, discussed supra, at 683. The Court of Appeals also held that, if the homestead interest under Texas law were "merely an exemption" without accompanying vested property rights, it would not be effective against the Federal Government in a § 7403 *701 proceeding, even in the case of a nondelinquent spouse. 649 F.2d, at 1125. Nevertheless, the court concluded that, if the homestead estate both was claimed by a nondelinquent spouse and constituted a property right under state law, then it would bar the Federal Government from pursuing a forced sale of the entire property.
We disagree. If § 7403 is intended, as we believe it is, to reach the entire property in which a delinquent taxpayer has or had any "right, title, or interest," then state-created exemptions against forced sale should be no more effective with regard to the entire property than with regard to the "right, title, or interest" itself. Accord, United States v. Overman, 424 F. 2d, at 1145-1147; Herndon v. United States, 501 F.2d 1219, 1223-1224 (CA8 1974) (Ross, J., concurring).[29] No exception of the sort carved out by the Court of Appeals appears on the face of the statute, and we decline to frustrate the policy of the statute by reading such an exception into it. Cf. Hisquierdo v. Hisquierdo, 439 U.S. 572, 586-587 (1979); United States v. Mitchell, supra, at 205-206. Moreover, the Supremacy Clause[30] which provides the underpinning for the Federal Government's right to sweep aside state-created exemptions in the first place is as potent in its application to innocent bystanders as in its application to delinquent debtors. See United States v. Union Central Life Insurance Co., 368 U. S., at 293-295 (federal tax lien good against bona fide purchaser, even though lien not filed in accordance with provisions of state law); cf. Hisquierdo v. Hisquierdo, supra, at 585-586; United States v. Carmack, 329 U.S. 230, 236-240 *702 (1946). Whatever property rights attach to a homestead under Texas law are adequately discharged by the payment of compensation, and no further deference to state law is required, either by § 7403 or by the Constitution.
The dissent urges us to carve out an exception from the plain language of § 7403 in that "small number of joint-ownership situations . . . [in which] the delinquent taxpayer has no right to force partition or otherwise to alienate the entire property without the consent of the co-owner." Post, at 715. Its primary argument in favor of such an exception is that it would be consistent with traditional limitations on the rights of a lienholder. Post, at 713-715, 723-724. If § 7403 truly embodied traditional limitations on the rights of lienholders, however, then we would have to conclude that Folsom v. United States, 306 F.2d 361 (CA5 1962), discussed supra, at 690, 696-697, was correctly decided, a proposition that even the dissent is not willing to advance. See post, at 713, 714, n. 2, 726. More importantly, we believe that the better analogy in this case is not to the traditional rights of lienholders, but to the traditional powers of a taxing authority in an in rem enforcement proceeding. See supra, at 694-695.[31]
*703 IV
A
Although we have held that the Supremacy Clause allows the federal tax collector to convert a nondelinquent spouse's *704 homestead estate into its fair cash value, and that such a conversion satisfies the requirements of due process, we are not blind to the fact that in practical terms financial compensation may not always be a completely adequate substitute for a roof over one's head. Cf. United States v. 564.54 Acres of Land, 441 U.S. 506, 510-513 (1979). This problem seems particularly acute in the case of a homestead interest. First, the nature of the market for life estates or the market for rental property may be such that the value of a homestead interest, calculated as some fraction of the total value of a home, would be less than the price demanded by the market for a lifetime's interest in an equivalent home. Second, any calculation of the cash value of a homestead interest must of necessity be based on actuarial statistics, and will unavoidably undercompensate persons who end up living longer than the average.[32] Indeed, it is precisely because of problems such as these that a number of courts, in eminent domain cases involving property divided between a homestead interest and underlying ownership rights or between a life estate and a remainder interest, have refused to distribute the proceeds *705 according to an actuarial formula, and have instead placed the entire award in trust (or reinvested it in a new parcel of property) with the income (or use) going to the life-estate holder during his or her lifetime, and the corpus vesting in the holder of the remainder interest upon the death of the life-estate holder.[33]
If the sale and distribution provided for in § 7403 were mandatory, the practical problems we have just described would be of little legal consequence. The statute provides, however, that the court in a § 7403 proceeding "shall . . . proceed to adjudicate all matters involved therein and finally determine the merits of all claims to and liens upon the property, and, in all cases where a claim or interest of the United States therein is established, may decree a sale of such property. . ." (emphasis added), and respondents argue that this language allows a district court hearing a § 7403 proceeding to exercise a degree of equitable discretion and refuse to authorize a forced sale in a particular case. See Tillery v. Parks, 630 F.2d 775 (CA10 1980); United States v. Eaves, 499 F.2d 869, 870-871 (CA10 1974); United States v. Hershberger, 475 F. 2d, at 679-680; United States v. Overman, 424 F. 2d, at 1146; United States v. Morrison, 247 F.2d 285, 289-291 (CA5 1957). The Court of Appeals agreed *706 with this interpretation of the statute, although it does not appear to have relied on it, 649 F.2d, at 1125, and in any event neither it nor the District Court undertook any particularized equitable assessment of the cases now before us. We find the question to be close, but on balance, we too conclude that § 7403 does not require a district court to authorize a forced sale under absolutely all circumstances, and that some limited room is left in the statute for the exercise of reasoned discretion.
B
The word "may," when used in a statute, usually implies some degree of discretion.[34] This common-sense principle of statutory construction is by no means invariable, however, see Mason v. Fearson, 9 How. 248, 258-260 (1850); see generally United States ex rel. Siegel v. Thoman, 156 U.S. 353, 359-360 (1895), and cases cited, and can be defeated by indications of legislative intent to the contrary or by obvious inferences from the structure and purpose of the statute, see ibid.
In these cases, we have little to go on in discerning Congress' intent except for one crucial fact: before 1936, the predecessor statute to § 7403 used the word "shall" rather than the word "may" in describing the court's role in ordering a forced sale of property in which a claim or interest of the United States had been shown. Revenue Act of 1926, Pub. L. 20, § 1127, 44 Stat. (part 2) 9, 123-124. In 1936, as one of a number of amendments in the text of the provision, Congress changed "shall" to "may." Revenue Act of 1936, Pub. L. 740, § 802, 49 Stat. 1648, 1743-1744. The other changes specifically, expanding the scope of § 7403 to include personal as well as real property, and adding the receivership option *707 now embodied in § 7403(d), see supra, at 681 are explained in the legislative history.[35] There is no direct explanation for the change from "shall" to "may."[36]
The Government argues that the only significance of the change from "shall" to "may" was that "Congress recognized it had specifically authorized sale of interests in property, sale of the entire property, and receivership. Employing the term `shall' with respect to each may have been perceived as confusing insofar as it could be read as directing contradictory requirements." Reply Brief for United States 8, n. 5. *708 We find this explanation plausible, but not compelling. If Congress had really meant no more than to adjust the forced sale language to take into account the receivership option, it could have easily expressed that intention more clearly by language to the effect of "the court shall either decree the sale of such property . . . or, upon the instance of the United States, appoint a receiver to enforce the lien, etc." Moreover, the authors of an earlier, unpassed, otherwise virtually identical proposal introduced in the House, did not think it necessary to change "shall" to "may" in their version of the legislation. See nn. 35, 36, supra.
Faced as we are with such an ambiguous legislative record, we come to rest with the natural meaning of the language enacted into law. In light of the fact that Congress did see fit to explain the other changes in the 1936 Act, we do not assert that Congress, without comment or explanation, intended to create equitable discretion where none existed before. On the other hand, there is support in our prior cases for the proposition that an unexplained change in statutory wording from "shall" to "may" is best construed as indicating a congressional belief that equitable discretion existed all along. Moore v. Illinois Central R. Co., 312 U.S. 630, 635 (1941); cf. Haig v. Agee, 453 U.S. 280, 294, n. 26 (1981).
In addition, reading "may" as either conferring or confirming a degree of equitable discretion conforms to the even more important principle of statutory construction that Congress should not lightly be assumed to have enacted a statutory scheme foreclosing a court of equity from the exercise of its traditional discretion. Weinberger v. Romero-Barcelo, 456 U.S. 305, 313 (1982); Porter v. Warner Holding Co., 328 U.S. 395, 398 (1946); Hecht Co. v. Bowles, 321 U.S. 321, 330 (1944). A § 7403 proceeding is by its nature a proceeding in equity,[37] and judicial sales in general have traditionally *709 been accompanied by at least a limited degree of judicial discretion.[38]
Finally, we are convinced that recognizing that district courts may exercise a degree of equitable discretion in § 7403 proceedings is consistent with the policies of the statute: unlike an absolute exception, which we rejected above, the exercise of limited equitable discretion in individual cases can take into account both the Government's interest in prompt and certain collection of delinquent taxes and the possibility that innocent third parties will be unduly harmed by that effort.
C
To say that district courts need not always go ahead with a forced sale authorized by § 7403 is not to say that they have unbridled discretion. We can think of virtually no circumstances, for example, in which it would be permissible to refuse to authorize a sale simply to protect the interests of the delinquent taxpayer himself or herself.[39] And even when the interests of third parties are involved, we think that a *710 certain fairly limited set of considerations will almost always be paramount.
First, a court should consider the extent to which the Government's financial interests would be prejudiced if it were relegated to a forced sale of the partial interest actually liable for the delinquent taxes. Even the Government seems to concede that, if such a partial sale would not prejudice it at all (because the separate market value of the partial interest is likely to be equal to or greater than its value as a fraction of the total value of the entire property) then there would be no reason at all to authorize a sale of the entire property. Tr. of Oral Arg. 7, 13; Reply Brief for United States 8, n. 5.[40] We think that a natural extension of this principle, however, is that, even when the partial interest would be worth less sold separately than sold as part of the entire property, the possibility of prejudice to the Government can still be measured as a matter of degree. Simply put, the higher the expected market price, the less the prejudice, and the less weighty the Government's interest in going ahead with a sale of the entire property.[41]
Second, a court should consider whether the third party with a nonliable separate interest in the property would, in the normal course of events (leaving aside § 7403 and eminent domain proceedings, of course), have a legally recognized expectation that that separate property would not be subject *711 to forced sale by the delinquent taxpayer or his or her creditors. If there is no such expectation, then there would seem to be little reason not to authorize the sale. Again, however, this factor is amenable to considerations of degree. The Texas homestead laws are almost absolute in their protections against forced sale.[42] The usual cotenancy arrangement, which allows any cotenant to seek a judicial sale of the property and distribution of the proceeds, but which also allows the other cotenants to resist the sale and apply instead for a partition in kind, is further along the continuum. And a host of other types of property interests are arrayed between and beyond.
Third, a court should consider the likely prejudice to the third party, both in personal dislocation costs and in the sort of practical undercompensation described supra, at 704-705.
Fourth, a court should consider the relative character and value of the nonliable and liable interests held in the property: if, for example, in the case of real property, the third party has no present possessory interest or fee interest in the property, there may be little reason not to allow the sale; if, on the other hand, the third party not only has a possessory interest or fee interest, but that interest is worth 99% of the value of the property, then there might well be virtually no reason to allow the sale to proceed.
We do not pretend that the factors we have just outlined constitute an exhaustive list; we certainly do not contemplate that they be used as a "mechanical checklist" to the exclusion of common sense and consideration of special circumstances. Cf. Moses H. Cone Hospital v. Mercury Construction Corp., 460 U.S. 1, 16 (1983). We do emphasize, however, that the limited discretion accorded by § 7403 should be exercised rigorously and sparingly, keeping in mind the Government's paramount interest in prompt and certain collection of delinquent taxes.
*712 V
In these cases, no individualized equitable balance of the sort we have just outlined has yet been attempted. In the Rodgers case, the record before us, although it is quite clear as to the legal issues relevant to the second consideration noted above, affords us little guidance otherwise. In any event, we think that the task of exercising equitable discretion should be left to the District Court in the first instance.
The Ingram case is a bit more complicated, even leaving aside the fact of the stipulated sale by which we are constrained to treat the escrow fund now sitting in the registry of the District Court as if it were a house. First, as the Court of Appeals pointed out, there remains a question under Texas law as to whether Joerene Ingram abandoned the homestead by the time of the stipulated sale. Second, the Government, in addition to its lien for the individual debt of Donald Ingram, has a further lien for $283.33, plus interest, on the house, representing the joint liability of Donald and Joerene Ingram. Because Joerene Ingram is not a "third party" as to that joint liability, we can see no reason, as long as that amount remains unpaid, not to allow a "sale" of the "house" (i. e., a levy on the proceeds of the stipulated sale) for satisfaction of the debt. Moreover, once the dam is broken, there is no reason, under our interpretation of § 7403, not to allow the Government also to collect on the individual debt of Donald Ingram out of that portion of the proceeds of the sale representing property interests properly liable for the debt. On the other hand, it would certainly be to Mrs. Ingram's advantage to discharge her personal liability before the Government can proceed with its "sale," in which event, assuming that she has not abandoned the homestead, the District Court will be obliged to strike an equitable balance on the same general principles as those that govern the Rodgers case.
The judgment of the Court of Appeals in Rodgers is reversed, its judgment in Ingram is vacated, and both cases *713A are remanded with directions that they be remanded to the District Court for further proceedings consistent with this opinion.
So ordered.
*713B JUSTICE BLACKMUN, with whom JUSTICE REHNQUIST, JUSTICE STEVENS, and JUSTICE O'CONNOR join, concurring in the result in part and dissenting in part.
The Court today properly rejects the broad legal principle concerning 26 U.S. C. § 7403 that was announced by the Court of Appeals. See ante, at 687-688 and 690-691. I agree that, in some situations, § 7403 gives the Government the power to sell property not belonging to the taxpayer. Our task, however, is to ascertain how far Congress intended that power to extend. In my view, § 7403 confers on the Government the power to sell or force the sale of jointly owned property only insofar as the tax debtor's interest in that property would permit him to do so; it does not confer on the Government the power to sell jointly owned property if an unindebted co-owner enjoys an indestructible right to bar a sale and to continue in possession. Because Mrs. Rodgers had such a right, and because she is not herself indebted to the Government, I dissent from the Court's disposition of her case.
I
It is basic in the common law that a lienholder enjoys rights in property no greater than those of the debtor himself; that is, the lienholder does no more than step into the debtor's shoes. 1 L. Jones, Law of Liens § 9, pp. 9-10 (1914). Thus, as a general rule, "[t]he lien of a judgment . . . cannot be made effectual to bind or to convey any greater or other estate than the debtor himself, in the exercise of his rights, could voluntarily have transferred or alienated." 49 C. J. S., Judgments § 478 (1947) (collecting cases); Commercial Credit Co. v. Davidson, 112 F.2d 54, 57 (CA5 1940); Wiltshire v. Warburton, 59 F.2d 611, 614 (CA4 1932). Similarly, pursuant to a state tax lien, "no greater interest in land than that *714 which was held by the taxpayer and taxable to him may be sold, so that, where a sale is had for unpaid taxes on a leasehold estate, only the leasehold estate is subject to conveyance."[1] 85 C. J. S., Taxation § 806 (1954) (footnote omitted) (collecting cases); United States v. Erie County, 31 F. Supp. 57, 60 (WDNY 1939). The lienholder may compel the debtor to exercise his property rights in order to meet his obligations or the lienholder may exercise those rights for him. But the debtor's default does not vest in the lienholder rights that were not available to the debtor himself.
In most situations in which a delinquent taxpayer shares property with an unindebted third party, it does no violence to this principle to order a sale of the entire property so long as the third party is fully compensated. A joint owner usually has at his disposal the power to convey the property or force its conveyance. Thus, for example, a joint tenant or tenant in common may seek partition. See generally W. Plumb, Federal Tax Liens 35 (3d ed. 1972). If a joint tenant is delinquent in his taxes, the United States does no more than step into the delinquent taxpayer's shoes when it compels a sale.[2]
*715 In a small number of joint-ownership situations, however, the delinquent taxpayer has no right to force partition or otherwise to alienate the entire property without the consent of the co-owner. These include tenancies by the entirety and certain homestead estates. See Plumb, Federal Liens and Priorities Agenda for the Next Decade II, 77 Yale L. J. 605, 634 (1968). In this case, the homestead estate owned by the delinquent taxpayer Mrs. Rodgers' deceased husband did not include the right to sell or force the sale of the homestead during Mrs. Rodgers' lifetime without her consent. Mrs. Rodgers had, and still has, an indefeasible right to possession, an interest, as the Court recognizes, "akin to an undivided life estate." Ante, at 686. A lienholder stepping into the shoes of the delinquent taxpayer would not be able to force a sale.
II
By holding that the District Court has the discretion to order a sale of Mrs. Rodgers' property, the Court necessarily finds in the general language of § 7403 a congressional intent to abrogate the rule that the tax collector's lien does not afford him rights in property in excess of the rights of the delinquent taxpayer.[3] I do not dispute that the general *716 language of § 7403, standing alone, is subject to the interpretation the Court gives it. From its enactment in 1868[4] to the present day, the language of this statute has been sweeping; read literally, it admits of no exceptions. But when broadly worded statutes, particularly those of some antiquity, are in derogation of common-law principles, this Court has hesitated to heed arguments that they should be applied literally. See Imbler v. Pachtman, 424 U.S. 409, 417 (1976). In such cases, the Court has presumed in the absence of a clear indication to the contrary that Congress did not mean by its use of general language to contravene fundamental precepts of the common law.[5]
*717 A
Apart from the general language of the statute, the Court points to nothing indicating a congressional intent to abrogate the traditional rule. It seems to me, indeed, that the evidence definitely points the other way. Scholarly comment on § 7403, and on § 6321, the tax lien provision, consistently has maintained that, in States such as Texas that confer on each spouse absolute rights to full use and possession of the homestead for life, the homestead property rights of an unindebted spouse may not be sold by the tax collector to satisfy the other spouse's tax debt.[6] Court decisions addressing *718 this point have been to the same effect.[7] In 1966, the American Bar Association placed before Congress this virtually undisputed view of the law of federal tax liens. Legislative History 177.[8] Since 1936, Congress repeatedly has addressed *719 the law of federal tax liens, directing some attention to § 7403.[9] Against the background of this consensus among courts and commentators that tax liens may not be enforced against such homesteads so long as an unindebted spouse still lives, Congress did not change the law.
In fact, in 1954 the Senate foiled an attempt by the House to extend the reach of federal tax liens to tenancies by the entirety, a spousal property interest similar to the Texas homestead.[10] The rule pronounced in the courts, e. g., United States v. Hutcherson, 188 F.2d 326, 331 (CA8 1951); United States v. Nathanson, 60 F. Supp. 193, 194 (ED Mich. 1945), and the view of the commentators, e. g., Anderson, supra n. 3, at 254; Clark, supra n. 3, at 17, was that tenancies by the entirety, like Texas homesteads, could not be sold to enforce the tax liability of one spouse. The House passed *720 an amendment that would have extended the tax lien created by § 6321 expressly to the taxpayer's interest as tenant by the entirety. H. R. 8300, 83d Cong., 2d Sess., § 6321 (1954) (Code bill). The Senate removed the language, stating: "The deletion of the phrase is intended to continue the existing law." S. Rep. No. 1622, 83d Cong., 2d Sess., 575 (1954).
It is true, of course, that tenancies by the entirety were held to be immune from federal tax sales on a theory different from that applied to homestead property like Mrs. Rodgers'. See ante, at 703-704, n. 31. But it was established that both types of property interests precluded the Government from satisfying the tax debts of one spouse by selling the jointly owned property. In the absence of any evidence of congressional intent to the contrary, this deliberate choice to leave undisturbed the bar to tax enforcement created by a tenancy by the entirety[11] suggests that Congress did not object to the similar effect of the Texas homestead right, an effect consistent with principles basic to the common law of liens.
*721 B
Although disclaiming it as a basis for decision, the Court relies on Mansfield v. Excelsior Refining Co., 135 U.S. 326, 339-341 (1890), to support its reading of § 7403. Ante, at 691-692, n. 17. In Mansfield, a tenant who operated a distillery on leased property fell delinquent in its taxes. The Government sought to sell by administrative levy the entire fee, not just the tenant's leasehold interest. The fee was owned by a third party, and the delinquent taxpayer's leasehold interest obviously did not give him the power to sell the fee. The Mansfield Court would not allow a sale by administrative levy, but suggested that on the facts of that case, the Government could seek a judicial sale of the entire property under the predecessor of § 7403. Focusing on just this portion of the Mansfield opinion, the Court now states that "[r]ead broadly, Mansfield is on `all fours' with our holding today." Ante, at 692, n. 17.
To the contrary, Mansfield is not on "all fours" with today's holding, and indeed undermines it. In the same 1868 Act in which it passed the original predecessor to § 7403, Congress enacted a separate provision to ensure the collection of taxes from distillers. Section 8 of that Act required each distiller to own its distillery property in fee and free from liens. Alternatively, a distiller could file with the tax collector the fee owner's written consent granting a tax lien of the United States priority over all other claims to the property, and granting the United States full title in the property in case of forfeiture. Act of July 20, 1868, ch. 186, § 8, 15 Stat. 128.
The taxpayer's landlord in Mansfield had executed such a waiver, and the Court stated that "the vital question" was the waiver's effect. 135 U.S., at 338. Rejecting the Government's position, the Court held that the waiver did not permit sale of the property by administrative levy. The Court made clear, however, that its reading of the statute did *722 not render the waiver requirement useless. "By the waiver the government . . . acquired the right, by a suit [under the predecessor of § 7403], to have sold, under the decree of a court, not only the distiller's leasehold interest, but the fee in the premises." Id., at 340.
Thus, the Mansfield Court considered the waiver to be a condition precedent to the Government's power, under the predecessor of § 7403, to sell the landlord's fee interest when the tenant was in default in its taxes. If § 7403 gives the Government this power without the necessity of a waiver as the Court today holds it seems unlikely that Congress would have considered it necessary, in the very Act in which it passed § 7403's predecessor, to require that a distiller either own the fee outright or obtain from its landlord advance authorization for a sale of the fee to satisfy the distiller's tax liabilities.[12] Outside the distillery context, Congress must have intended that the Government's power to force a sale of the fee would be no more extensive than that of the delinquent taxpayer.
*723 C
The Court's "broad reading" of Mansfield's holding reflects only the extraordinary breadth of its own. As read by the Court, Mansfield authorizes, without the consent of the owner of the fee, a judicial sale of a building should a tenant fail to pay his taxes, a judicial sale of a farm should the holder of an easement across it become delinquent,[13] or a judicial sale of a condominium or cooperative apartment house to satisfy the tax debt of any co-owner.[14] The Court imputes to Congress an intent to permit the sale of the farm or the building even though the fee owners have paid their taxes and even though, in signing a lease or conveying an easement, the fee owners did not surrender their indefeasible right to prevent the sale of their property.
Prior to 1936, moreover, the predecessor of § 7403(c) required a court at the Government's request to sell the property *724 in which the tax debtor had an interest. See ante, at 706-709. Thus, the Court's view attributes to Congress the incredible intention to mandate the sale of the entire property whenever the holder of an easement, a tenant, or one with a similarly minimal interest fails to pay a tax and the Government invokes its right to bring an action to enforce its lien. It is hardly surprising that counsel for the Government has been unable to cite a single instance before or after this Court's decision in Mansfield in which the Government, outside the context of the homestead cases, invoked § 7403 or its predecessors to assert a property right greater than the tax-payer himself could have asserted. Tr. of Oral Arg. 14-16. To abrogate the common-law rule that the tax collector gains only the property rights of the tax debtor leads to absurd results.
III
Without direct evidence of congressional intent to contravene the traditional and sensible common-law rule, the Court advances three arguments purporting to lend indirect support for its construction of § 7403.
A
First, the Court claims that its construction is consistent with the policy favoring "the prompt and certain collection of delinquent taxes." Ante, at 694. This rationale would support any exercise of governmental power to secure tax payments. Were there two equally plausible suppositions of congressional intent, this policy might counsel in favor of choosing the construction more favorable to the Government. But when one interpretation contravenes both traditional rules of law and the common sense and common values on which they are built, the fact that it favors the Government's interests cannot be dispositive.[15]
*725 Moreover, the Government's interest would not be compromised substantially by a rule permitting it to sell property only when the delinquent taxpayer could have done so. In this case, the delinquent taxpayer's homestead interest, it is assumed, gave him a "half-interest in the underlying ownership rights to the property being sold." Ante, at 699. An immediate forced sale of the entire property would yield for the Government no more than half the present value of the remainder interest, the residue left after the present values of the nondelinquent spouse's life estate and half-interest in the remainder are subtracted. As the Court notes, the Government can expect to receive only a small fraction of the proceeds. Ibid. An immediate sale of the delinquent taxpayer's future interest in the property might well command a commensurate price.
Alternatively, the Government could maintain its lien on the property until Mrs. Rodgers dies and then could force a sale. Because the delinquent taxpayer's estate retains a half-interest in the remainder, the Government would be entitled to half of the proceeds at that time. The Government's yield from this future sale, discounted to its present value, should not differ significantly from its yield under the Court's approach. The principal difference is that, following the common-law rule, Mrs. Rodgers' entitlement to live out her life on her homestead would be respected.
An approach consistent with the common law need not prejudice the Government's interest in the "certain" collection of taxes. Under § 7403(d),[16] the District Court has the power to appoint a receiver, who could supervise the property to protect the Government's interests while respecting Mrs. Rodgers' rights to possession and enjoyment. Plumb, *726 77 Yale L. J., at 638. Indeed, just such an approach was suggested by the American Bar Association's Committee on Federal Liens, 84 A. B. A. Rep. 645, 681-682 (1959), which drafted the tax lien amendments adopted in 1966. Legislative History 108-109 (statement of Laurens Williams).
B
The Court also would support its construction by contrasting § 7403 with the more restrictive language of § 6331, the administrative tax levy provision. Ante, at 695-697. It is true that § 6331 permits the sale only of "property and rights to property . . . belonging to" the taxpayer, while § 7403 generally authorizes the sale of property in which the taxpayer has an interest. But the greater power conferred by § 7403 is needed to enable the Government to seek the sale of jointly owned property whenever the tax debtor's rights in the property would have permitted him to seek a forced sale. Section 7403 certainly permits the Government, in such circumstances, to seek partition of the property in federal, rather than state, court, to seek authority to sell the tax debtor's part or the whole, and, in the same proceeding, to have determined the entitlements of the various claimants, including competing lienholders, to the proceeds of the property sold. See generally Plumb, 77 Yale L. J., at 628-629. Absent the more expansive language of § 7403, this would not be possible. That language, however, does not manifest congressional intent to produce the extraordinary consequences yielded by the Court's interpretation.
C
The Court also asserts that its construction of § 7403 is consistent with "the traditional powers of a taxing authority in an in rem enforcement proceeding," even if it is not consistent with the traditional rights of lienholders. Ante, at 694-695 and 702. This, with all respect, is not so. In rem tax enforcement proceedings never have been used to sell property *727 belonging to unindebted third parties in order to satisfy a tax delinquency unrelated to the property sold. As the Court recognizes, ante, at 694, such proceedings are brought to sell land in order to satisfy delinquent ad valorem taxes assessed on the land itself. 2 T. Cooley, Law of Taxation 866, 910 (3d ed. 1903). It is said that the land itself is liable for such taxes, and that conflicting ownership rights thus do not bar its sale. See id., at 866-868; H. Black, Law of Tax Titles 296 (1888); W. Burroughs, Law of Taxation 346-349 (1877). The cases relied upon by the Court for the proposition that in rem tax proceedings extinguish the homestead rights of an unindebted spouse merely applied this rule. Lucas v. Purdy, 142 Iowa 359, 120 N.W. 1063 (1909); Robbins v. Barron, 32 Mich. 36 (1875); Jones v. Devore, 8 Ohio St. 430 (1858).
On the other hand, if the tax is assessed on an individual's separate interest in the land, rather than on the land itself, the tax debt is personal to the individual and "[n]othing more [than the individual's interest] . . . can become delinquent; nothing more can be sold." Black, supra, at 301; see R. Blackwell, On the Power to Sell Land 908, 920, 942 (5th ed. 1889); 2 Cooley, supra, at 870-871; Burroughs, supra, at 347. The real property interests of third parties cannot be sold through an in rem proceeding to satisfy a personal tax liability. The "traditional powers of a taxing authority" to sell the entire property and extinguish the interests of unindebted third parties thus are limited to collection of taxes assessed on the land itself, and have no application to delinquent taxes, like those at issue in these cases, assessed personally against one joint owner.[17]
*728 Some States, it is true, have authorized by statute the sale of real property to satisfy the owner's tax debts, even where the delinquent taxes are unrelated to the property. See Larimer County v. National State Bank of Boulder, 11 Colo. 564 (1888); Iowa Land Co. v. Douglas County, 8 S. D. 491 (1896). The Court does not suggest, however, that jointly owned real property ever has been sold pursuant to such a statute when an unindebted co-owner has indefeasible rights therein. Indeed, the traditional distinction between taxes for which the land is liable and tax liabilities personal to the taxpayer would preclude such a sale. Thus, even if one purpose of § 7403's predecessor statute "was to obtain for the federal tax collector some of the advantages that many States enjoyed through in rem tax enforcement," ante, at 695, Congress would not have intended the result the Court reaches today. A state tax collector could not confiscate the indefeasible real property interests of a nondelinquent third party to satisfy the personal tax liability of a co-owner.[18]
*729 IV
The Court recognizes that Mrs. Rodgers has an indestructible property right under Texas law to use, possess, and enjoy her homestead during her lifetime, and that the delinquent taxpayer's property interests would not have enabled him to disturb that right against her will. Ante, at 685-686. The Court recognizes that Mrs. Rodgers has no outstanding tax liability and that the Government has no lien on Mrs. Rodgers' property or property rights. Because I conclude that Congress did not intend § 7403 to permit federal courts to grant property rights to the Government greater than those enjoyed by the tax debtor, I would hold that the Government may not sell Mrs. Rodgers' homestead without her consent. To the extent the Court holds to the contrary, I respectfully dissent.
V
Mrs. Ingram's case, however, is materially different. Like her husband, Mrs. Ingram was liable for back taxes, and consequently the Government had a lien on her interests in property as well as on her husband's interests. Exercising both spouses' rights in the homestead, the Government is entitled *730 to force a sale, Plumb, 13 Tax L. Rev., at 263; see Shambaugh v. Scofield, 132 F.2d 345 (CA5 1942), subject only to the discretion of the District Court. See ante, at 703-711. Second, when Mrs. Ingram and her former husband were divorced, the homestead became subject to partition under Texas law. See ante, at 685, n. 10. In Mrs. Ingram's case, therefore, I concur in the result.
| These consolidated cases involve the relationship between the imperatives of federal tax collection and rights accorded by state property laws. Section 7403 of the Internal Revenue Code of 1954, 26 U.S. C. 7403 (1976 ed. and Supp. V), authorizes the judicial sale of certain properties to satisfy the tax indebtedness of delinquent taxpayers. The issue in both cases is whether 7403 empowers a federal district court to order the sale of a family home in which a delinquent taxpayer had an interest at the time he incurred his indebtedness, but in which the taxpayer's spouse, who does not owe any of that indebtedness, has a separate "homestead" right as defined by Texas law. We hold that the statute does grant power to order the sale, but that s exercise is limed to some degree by equable discretion. We hold that, if the home is sold, the nondelinquent spouse is entled, as part of the distribution of proceeds required under 7403, to so much of the proceeds as represents complete compensation for the loss of the homestead estate. I A Section 7403 provides in full as follows: "(a) Filing. In any case where there has been a refusal or neglect to pay any tax, or to discharge any liabily in respect thereof, whether or not levy has been made, the Attorney General or his delegate, at the request of the Secretary [of the Treasury], may direct a civil action to be filed in a district court of the Uned to enforce the lien of the Uned under this tle wh respect to such tax or liabily or to subject any *681 property, of whatever nature, of the delinquent, or in which he has any right, tle, or interest, to the payment of such tax or liabily. For purposes of the preceding sentence, any acceleration of payment under section 66(g) shall be treated as a neglect to pay tax. "(b) Parties. All persons having liens upon or claiming any interest in the property involved in such action shall be made parties thereto. "(c) Adjudication and decree. The court shall, after the parties have been duly notified of the action, proceed to adjudicate all matters involved therein and finally determine the mers of all claims to and liens upon the property, and, in all cases where a claim or interest of the Uned therein is established, may decree a sale of such property, by the proper officer of the court, and a distribution of the proceeds of such sale according to the findings of the court in respect to the interests of the parties and of the Uned If the property is sold to satisfy a first lien held by the Uned the Uned may bid at the sale such sum, not exceeding the amount of such lien wh expenses of sale, as the Secretary directs. "(d) Receivership. In any such proceeding, at the instance of the Uned the court may appoint a receiver to enforce the lien, or, upon certification by the Secretary during the pendency of such proceedings that is in the public interest, may appoint a receiver wh all the powers of a receiver in equy." As a general matter,[1] the "lien of the Uned " referred to in 7403(a) is that created by 26 U.S. C. 6321, which provides: "If any person liable to pay any tax neglects or refuses to pay the same after demand, the amount (including any *682 interest, addional amount, addion to tax, or assessable penalty, together wh any costs that may accrue in addion thereto) shall be a lien in favor of the Uned upon all property and rights to property, whether real or personal, belonging to such person."[2] Section 7403, whose basic elements go back to revenue legislation passed in 1868 ( 106 of the Act of July 20, 1868, ch. 186, ) is one of a number of distinct enforcement tools available to the Uned for the collection of delinquent taxes.[3] The Government may, for example, simply sue for the unpaid amount, and, on getting a judgment, exercise the usual rights of a judgment credor. See 26 U.S. C. 6502(a), 7401, 7402(a). Yet a third route is administrative levy under 26 U.S. C. 6(a), which provides: "If any person liable to pay any tax neglects or refuses to pay the same whin 10 days after notice and demand, shall be lawful for the Secretary [or his delegate] to collect such tax (and such further sum as shall be sufficient to cover the expenses of the levy) by levy upon all property and rights to property (except such property as is exempt under section 6334) belonging to such person or on which there is a lien provided in this chapter for the payment of such tax" Administrative levy, unlike an ordinary lawsu, and unlike the procedure in 7403, does not require any judicial intervention, and is up to the taxpayer, if he so *683 chooses, to go to court if he claims that the assessed amount was not legally owing. See generally[4] The common purpose of this formidable arsenal of collection tools is to ensure the prompt and certain enforcement of the tax laws in a system relying primarily on self-reporting. See G. M. Leasing ; Uned ; at 259-.[5] Moreover, has long been an axiom of our tax collection scheme that, although the definion of underlying property interests is left to state law, the consequences that attach to those interests is a matter left to federal law. See Uned v. ; Uned v. Union Central Life Insurance ; Aquilino v. Uned 3-5 and cases ced (attachment of federal lien depends on whether "property" or "rights to property" exist under state law; priory of federal lien depends on federal law); Uned v. 7 U.S. ; Springer v. Uned *684 B The substance of Texas law related to the homestead right may usefully be divided into two categories. Cf. First, in common wh a large number of Texas establishes the family home or place of business[6] as an enclave exempted from the reach of most credors. Thus, under Tex. Const., Art. 50: "The homestead of a family, or of a single adult person, shall be, and is hereby protected from forced sale, for the payment of all debts except for [certain exceptions not relevant here] No mortgage, trust deed, or other lien on the homestead shall ever be valid, except for [certain exceptions not relevant here]."[7] Second, in common wh a somewhat smaller number of Texas gives members of the family un addional rights in the homestead property self. Thus, in a clause not included in the above quotation, Tex. Const., Art 50, provides that "the owner or claimant of the property *685 claimed as homestead [may not], if married, sell or abandon the homestead whout the consent of the other spouse, given in such manner as may be prescribed by law."[8] Equally important, Art. 52, provides: "On the death of the husband or wife, or both, the homestead shall descend and vest in like manner as other real property of the deceased, and shall be governed by the same laws of descent and distribution, but shall not be partioned among the heirs of the deceased during the lifetime of the surviving husband or wife, or so long as the survivor may elect to use or occupy the same as a homestead, or so long as the guardian of the minor children of the deceased may be permted, under the order of the proper court having the jurisdiction, to use and occupy the same."[9] The effect of these provisions in the Texas Constution is to give each spouse in a marriage a separate and undivided possessory interest in the homestead, which is only lost by death or abandonment, and which may not be compromised eher by the other spouse or by his or her heirs.[10] It bears emphasis that the rights accorded by the homestead laws vest independently in each spouse regardless of whether one spouse, or both, actually owns the fee interest in the homestead. Thus, although analogy is somewhat hazardous in *686 this area, may be said that the homestead laws have the effect of reducing the underlying ownership rights in a homestead property to something akin to remainder interests and vesting in each spouse an interest akin to an undivided life estate in the property. See and cases ced; and cases ced; and cases ced. This analogy, although does some injustice to the nuances present in the Texas homestead statute,[11] serves to bring to the fore something that has been repeatedly emphasized by the Texas courts, and that was reaffirmed by the Court of Appeals in these cases: that the Texas homestead right is not a mere statutory entlement, but a vested property right. As the Supreme Court of Texas has put a spouse "has a vested estate in the land of which she cannot be divested during her life except by abandonment or a voluntary conveyance in the manner prescribed by law." at 218 S.W.2d, at ; see Uned v. Rogers, and cases ced.[12] II The two cases before us were consolidated for oral argument before the Uned Court of Appeals for the Fifth Circu, and resulted in opinions issued on the same day. Uned v. Rogers, ;[13] They arise out of legally comparable, but que distinct, sets of facts. A Lucille Mzi Bosco Rodgers is the widow of Philip S. Bosco, whom she married in 1937. She and Mr. Bosco acquired, as communy property, a residence in Dallas, Texas, and occupied as their homestead. Subsequently, in 1971 and the Internal Revenue Service issued assessments totaling more than $900,000 for federal wagering taxes, penalties, and interest, against Philip for the taxable years 1966 through 1971. These taxes remained unpaid at the time of Philip's death in Since Philip's death, Lucille has continued to occupy the property as her homestead, and now lives there wh her present husband. On September 23, 1977, the Government filed su under 26 U.S. C. 7402 and 7403 in the Uned District Court for the Northern District of Texas against Mrs. Rodgers and Philip's son, daughter, and executor. The su sought to reduce to judgment the assessments against Philip, to enforce the Government's tax liens, including the one that had attached to Philip's interest in the residence, and to obtain a deficiency judgment in the amount of any unsatisfied part of the liabily. On cross-motions for summary judgment, the District Court granted partial summary judgment on, among other things, the defendants' claim that the federal tax liens could not defeat Mrs. Rodgers' state-created right not to have her homestead subjected to a forced sale. Fed. Rule Civ. Proc. 54(b). The Court of Appeals affirmed on the homestead issue,[14] holding that if "a homestead interest is, under state law, a property right, possessed by the nontaxpayer spouse at the time the lien attaches to the taxpayer spouse's interest, then the federal tax lien may not be foreclosed against the homestead *688 property for as long as the nontaxpayer spouse maintains his or her homestead interest under state law." The court implied that the Government had the choice of eher waing until Mrs. Rodgers' homestead interest lapsed, or satisfying self wh a forced sale of only Philip Bosco's interest in the property. B Joerene Ingram is the divorced wife of Donald Ingram. During their marriage, Joerene and Donald acquired, as communy property, a residence in Dallas, Texas, and occupied as their homestead. Subsequently, in and 1973, the Internal Revenue Service issued assessments against Donald Ingram relating to unpaid taxes whheld from wages of employees of a company of which he was president. Deducting payments made on account of these liabilies, there remains unpaid approximately $9,000, plus interest. In addion, in 1973, the Service made an assessment against both Donald and Joerene in the amount of $283.33, plus interest, relating to their joint income tax liabily for 1971. These amounts remain unpaid. In March 1975, at about the time the Ingrams were seeking a divorce, their residence was destroyed by fire. In September 1975, the Ingrams obtained a divorce. In connection wh the divorce, they entered into a property settlement agreement, one provision of which was that Donald would convey to Joerene his interest in the real property involved in this case in exchange for $1,500, to be paid from the proceeds of the sale of the property. Joerene tried to sell the property, through a trustee, but was unsuccessful in those efforts, apparently because of the federal tax liens encumbering the property. To make matters worse, she then received notice from the Cy of Dallas Department of Housing and Urban Rehabilation (Department) that unless she complied wh local ordinances, the remains of the fire-damaged *689 residence would be demolished. Following a hearing, the Department issued a final notice and a work order to demolish. Joerene Ingram and the trustee then filed su in Texas state court to quiet tle to the property, to remove the federal tax liens, and to enjoin demolion. The defendants were the Uned the Department, and several credors claiming an interest in the property. The Uned removed the su to the District Court for the Northern District of Texas. It then filed a counterclaim against Joerene Ingram and Donald Ingram (who was added as a defendant on the counterclaim) for both the unpaid whholding taxes and the joint liabily for unpaid income taxes. In s prayer for relief, the Government sought, among other things, judicial sale of the property under 7403. Pursuant to a stipulation of the parties, the property was sold unencumbered and the proceeds (approximately $,250) were deposed into the registry of the District Court pending the outcome of the su. The parties agreed that their rights, claims, and priories would be determined as if the sale had not taken place, and that the proceeds would be divided according to their respective interests. On cross-motions for summary judgment, the District Court granted summary judgment on the Government's counterclaims. The Court of Appeals affirmed in part, and reversed and remanded in part. It agreed that the Government could foreclose s lien on the proceeds from the sale of the property to collect the $283.33, plus interest, for the unpaid income tax owed by Joerene and Donald Ingram jointly. Applying s decision in Rodgers, however, held that the Government could not reach the proceeds of the sale of the property to collect the individual liabily of Donald Ingram, assuming Joerene Ingram had maintained her homestead interest in the property. The court remanded, however, for a factual determination of whether Joerene had "abandoned" the *690 homestead by dividing the insurance proceeds wh Donald and by attempting even before the stipulation entered into wh the Government to sell the property and divide the proceeds of that sale wh Donald.[15] C The Government filed a single petion for certiorari in both these cases. See this Court's Rule 19.4. We granted certiorari, in order to resolve a conflict among the Courts of Appeals as to the proper interpretation of 7403. III A The basic holding underlying the Court of Appeals' view that the Government was not authorized to seek a sale of the homes in which respondents held a homestead interest is that "when a delinquent taxpayer shares his ownership interest in property jointly wh other persons rather than being the sole owner, his `property' and `rights to property' to which the federal tax lien attaches under 26 U.S. C. 6321, and on which federal levy may be had under 26 U.S. C. 7403(a), involve only his interest in the property, and not the entire property." According to the Court of Appeals, this principle applies, not only in the homestead context, but in any cotenancy in which unindebted third parties share an ownership interest wh a delinquent taxpayer. See Folsom v. Uned We agree wh the Court of Appeals that the Government's lien under 6321 cannot extend beyond the property interests *691 held by the delinquent taxpayer.[] We agree that the Government may not ultimately collect, as satisfaction for the indebtedness owed to more than the value of the property interests that are actually liable for that debt. But, in this context at least, the right to collect and the right to seek a forced sale are two que different things. The Court of Appeals for the Fifth Circu recognized that was the only Court of Appeals that had adopted the view that the Government could seek the sale, under 7403, of only the delinquent taxpayer's "interest in the property, and not the entire property." and n. 12. We agree wh the prevailing view that such a restrictive reading of 7403 flies in the face of the plain meaning of the statute. See, e. g., Uned v. Trilling, ; Washington v. Uned ; Uned v. Overman, ; Uned v. Kocher, ; see 1 U.S. 326,[17] *692 Section 7403(a) provides, not only that the Government may "enforce [s] lien," but that may seek to "subject any property, of whatever nature, of the delinquent, or in which he has any right, tle, or interest, to the payment of such tax or liabily" (emphasis added). This clause in and of self defeats the reading proposed by the Court of Appeals.[18]*693 Section 7403(b) then provides that "[a]ll persons having liens upon or claiming any interest in the property involved in such action shall be made parties thereto" (emphasis added). Obviously, no joinder of persons claiming independent interests in the property would be necessary if the Government were only authorized to seek the sale of the delinquent taxpayer's own interests. Finally, 7403(c) provides that the district court should "determine the mers of all claims to and liens upon the property, and, in all cases where a claim or interest of the Uned therein is established, may decree a sale of such property and a distribution of the proceeds of such sale according to the findings of the court in respect to the interests of the parties and of the Uned " (emphasis added). Again, we must read the statute *694 to contemplate, not merely the sale of the delinquent taxpayer's own interest, but the sale of the entire property (as long as the Uned has any "claim or interest" in ), and the recognion of third-party interests through the mechanism of judicial valuation and distribution. Our reading of 7403 is consistent wh the policy inherent in the tax statutes in favor of the prompt and certain collection of delinquent taxes. See It requires no cation to point out that interests in property, when sold separately, may be worth eher significantly more or significantly less than the sum of their parts. When the latter is the case, makes considerable sense to allow the Government to seek the sale of the whole, and obtain s fair share of the proceeds, rather than satisfy self wh a mere sale of the part. Our reading is supported by an examination of the historical background against which the predecessor statute to 7403 was enacted. In 1868, as today, state taxation consisted in large part of ad valorem taxation on real property. In enforcing such taxes against delinquent taxpayers, one usual remedy was a sale by the State of the assessed property. The prevailing although admtedly not universal view was that such sales were in rem proceedings, and that the tle that was created in the sale extinguished not only the interests of the person liable to pay the tax, but any other interests that had attached to the property, even if the owners of such interests could not otherwise be held liable for the tax. See generally H. Law of Tax Tles 231-2 ; W. Law of Taxation 122 (1877). Where in rem proceedings were the rule, they were generally held to cut off as well dower or homestead rights possessed by the delinquent taxpayer's See 142 Iowa 9, ; ; ; 299; 348. But cf. R. well, Power to Sell Land for the Non-Payment of Taxes 550 (3d ed. 1). *695 One evident purpose of the federal judicial sale provision enacted in 1868 was to obtain for the federal tax collector some of the advantages that many enjoyed through in rem tax enforcement. As one commentator has put echoing almost exactly the usual description of state in rem proceedings, the 7403 proceeding "from s very nature, is a proceeding in rem. The purchaser receives a complete new tle and not just somebody's interest. The court finds the state of the tle to the real estate in question, orders sold if the Uned has a lien on and divides the proceeds accordingly. All prior interests are cut off and the tle starts over again in the new purchaser." Rogge, The Tax Lien of the Uned 13 A. B. A. J. 6, 7 (1927). See G. Holmes, Federal Income Tax 546-547 (1920). Even as gave the Government the right to seek an undivided sale in an in rem proceeding, however, the predecessor to 7403 departed que sharply from the model provided by the by guaranteeing that third parties wh an interest in the property receive a share of the proceeds commensurate wh the value of their interests. This apparently unique provision was prompted, we can assume, by the sense that, precisely because the federal taxes involved were not taxes on the real property being sold, simple justice required significantly greater solicude for third parties than was generally available in state in rem proceedings.[19] Finally, our reading of the statute is significantly bolstered by a comparison wh the statutory language setting out the administrative levy remedy available to the Government.[20]*696 Under 26 U.S. C. 6(a), the Government may sell for the collection of unpaid taxes all nonexempt "property and rights to property belonging to such person [i. e., the delinquent taxpayer] or on which there is a lien provided in this chapter for the payment of such tax" (emphasis added). This language clearly embodies the limation that the Court of Appeals thought was present in 7403, and has been so interpreted by the courts.[21] Section 6, unlike 7403, does not require notice and hearing for third parties, because no rights of third parties are intended to be implicated by 6. Indeed, third parties whose property or interests in property have been seized inadvertently are entled to claim that the property has been "wrongfully levied upon," and may apply for s return eher through administrative channels, 26 U.S. C. 6343(b), or through a civil action filed in a federal district court, 7426(a)(1); see 7426(b)(1), 7426(b)(2)(A).[22] In the absence of such "wrongful levy," the entire proceeds of a sale conducted pursuant to administrative levy may be applied, whout any prior distribution of the sort required by 7403, to the expenses of the levy and sale, the specific tax liabily on the seized property, and the general tax liabily of the delinquent taxpayer. 26 U.S. C. 6342. We are not entirely unmoved by the force of the basic intuion underlying the Court of Appeals' view of 7403 that the Government, though has the "right to pursue the property *697 of the [delinquent] taxpayer wh all the force and fury at s command," should not have any right, superior to that of other credors, to disturb the settled expectations of innocent third parties. Folsom v. Uned 306 F. 2d, at 7-8. In fact, however, the Government's right to seek a forced sale of the entire property in which a delinquent taxpayer had an interest does not arise out of s privileges as an ordinary credor, but out of the express terms of 7403. Moreover, the use of the power granted by 7403 is not the act of an ordinary credor, but the exercise of a sovereign prerogative, incident to the power to enforce the obligations of the delinquent taxpayer himself, and ultimately grounded in the constutional mandate to "lay and collect taxes."[23] Cf. -; ; Uned v. Snyder, Admtedly, if 7403 allowed for the gratuous confiscation of one person's property interests in order to satisfy another person's tax indebtedness, such a provision might pose significant difficulties under the Due Process Clause of the Fifth Amendment.[24] But, as we have already indicated, 7403 makes no further use of third-party property interests than to facilate the extraction of value from those concurrent property interests that are properly liable for the taxpayer's debt. To the extent that third-party property interests are "taken" in the process, 7403 provides compensation for that "taking" by requiring that the court distribute the proceeds of the sale "according to the findings of the court in respect to the interests of the parties and of the Uned *698" Cf. Uned v. Overman, 424 F. 2d, at Moreover, we hold, on the basis of what we are informed about the nature of the homestead estate in Texas, that is the sort of property interest for whose loss an innocent third party must be compensated under 7403. Cf. Uned v. General Motors Corp.,[25] We therefore see no contradiction, at least at the level of basic principle, between the enforcement powers granted to the Government under 7403 and the recognion of vested property interests granted to innocent third parties under state law. The exact method for the distribution required by 7403 is not before us at this time. But we can get a rough idea of the practical consequences of the principles we have just set out. For example, if we assume, only for the sake of illustration, that a homestead estate is the exact economic equivalent of a life estate, and that the use of a standard statutory or commercial table and an 8% discount rate is appropriate in calculating the value of that estate, then three nondelinquent surviving or remaining spouses, aged 30, 50, and 70 years, each holding a homestead estate, would be entled to approximately 97%, 89%, and 64%, respectively, of the proceeds of the sale of their homes as compensation for that *699 estate.[26] In addion, if we assume that each of these hypothetical nondelinquent spouses has a protected half-interest in the underlying ownership rights to the property being sold,[27] then their total compensation would be approximately 99%, 95%, and 82%, respectively, of the proceeds from such sale. In sum, the Internal Revenue Code, seen as a whole, contains a number of cumulative collection devices, each wh s own advantages and disadvantages for the tax collector. Among the advantages of administrative levy is that is quick and relatively inexpensive. Among the advantages of a 7403 proceeding is that gives the Federal Government the opportuny to seek the highest return possible on the forced sale of property interests liable for the payment of federal taxes. The provisions of 7403 are broad and profound. Nevertheless, 7403 is punctilious in protecting the vested rights of third parties caught in the Government's collection effort, and in ensuring that the Government not receive out of the proceeds of the sale any more than that to which is properly entled. Of course, the exercise in any particular case of the power granted under 7403 to seek the forced sale of property interests other than those of the delinquent taxpayer is left in the first instance to the good sense and common decency of the collecting authories. 26 U.S. C. 7403(a). We explore in Part IV of this opinion the nature *700 of the limed discretion left to the courts in proceedings brought under 7403. But that the power exists, and that is necessary to the prompt and certain enforcement of the tax laws, we have no doubt. B There is another, intermeshed but analytically distinguishable, ground advanced by the Court of Appeals and the respondents and reerated by the dissent for denying the Government the right to seek the forced sale of property held as a homestead by a nondelinquent third party. Taken in self, this view would hold that, even if 7403 normally allows for the forced sale of property interests other than those directly liable for the indebtedness of the delinquent taxpayer, the special protections accorded by the exemption aspect of Texas homestead law, see should immunize from the reach of 7403. The Court of Appeals conceded that "the homestead interest of a taxpayer spouse, i. e., that of one who himself has tax liabily, clearly cannot by self defeat [the enforcement under 7403 of] a federal tax lien." ; see This proposion, although not explic in the Code, is clearly implic in 26 U.S. C. 6334(c) (relating to exemptions from levy),[28] and in our decisions in Uned v. -; Aquilino v. Uned 3 U. S., at 3-4; and Uned v. 7 U. S., at The Court of Appeals held that, if the homestead interest under Texas law were "merely an exemption" whout accompanying vested property rights, would not be effective against the Federal Government in a 7403 *701 proceeding, even in the case of a nondelinquent Nevertheless, the court concluded that, if the homestead estate both was claimed by a nondelinquent spouse and constuted a property right under state law, then would bar the Federal Government from pursuing a forced sale of the entire property. We disagree. If 7403 is intended, as we believe is, to reach the entire property in which a delinquent taxpayer has or had any "right, tle, or interest," then state-created exemptions against forced sale should be no more effective wh regard to the entire property than wh regard to the "right, tle, or interest" self. Accord, Uned v. Overman, 424 F. 2d, at 1145-1147; Herndon v. Uned[29] No exception of the sort carved out by the Court of Appeals appears on the face of the statute, and we decline to frustrate the policy of the statute by reading such an exception into Cf. ; Uned v. at -206. Moreover, the Supremacy Clause[30] which provides the underpinning for the Federal Government's right to sweep aside state-created exemptions in the first place is as potent in s application to innocent bystanders as in s application to delinquent debtors. See Uned v. Union Central Life Insurance 8 U. S., at ; cf. at -586; Uned v. Carmack, Whatever property rights attach to a homestead under Texas law are adequately discharged by the payment of compensation, and no further deference to state law is required, eher by 7403 or by the Constution. The dissent urges us to carve out an exception from the plain language of 7403 in that "small number of joint-ownership suations [in which] the delinquent taxpayer has no right to force partion or otherwise to alienate the entire property whout the consent of the co-owner." Post, at 715. Its primary argument in favor of such an exception is that would be consistent wh tradional limations on the rights of a lienholder. Post, at 713-715, 723-724. If 7403 truly embodied tradional limations on the rights of lienholders, however, then we would have to conclude that Folsom v. Uned was correctly decided, a proposion that even the dissent is not willing to advance. See post, at 713, 714, n. 2, 726. More importantly, we believe that the better analogy in this case is not to the tradional rights of lienholders, but to the tradional powers of a taxing authory in an in rem enforcement proceeding. See[31] *703 IV A Although we have held that the Supremacy Clause allows the federal tax collector to convert a nondelinquent spouse's *704 homestead estate into s fair cash value, and that such a conversion satisfies the requirements of due process, we are not blind to the fact that in practical terms financial compensation may not always be a completely adequate substute for a roof over one's head. Cf. Uned v. 564.54 Acres of Land, 0-3 This problem seems particularly acute in the case of a homestead interest. First, the nature of the market for life estates or the market for rental property may be such that the value of a homestead interest, calculated as some fraction of the total value of a home, would be less than the price demanded by the market for a lifetime's interest in an equivalent home. Second, any calculation of the cash value of a homestead interest must of necessy be based on actuarial statistics, and will unavoidably undercompensate persons who end up living longer than the average.[32] Indeed, is precisely because of problems such as these that a number of courts, in eminent domain cases involving property divided between a homestead interest and underlying ownership rights or between a life estate and a remainder interest, have refused to distribute the proceeds *705 according to an actuarial formula, and have instead placed the entire award in trust (or reinvested in a new parcel of property) wh the income (or use) going to the life-estate holder during his or her lifetime, and the corpus vesting in the holder of the remainder interest upon the death of the life-estate holder.[33] If the sale and distribution provided for in 7403 were mandatory, the practical problems we have just would be of ltle legal consequence. The statute provides, however, that the court in a 7403 proceeding "shall proceed to adjudicate all matters involved therein and finally determine the mers of all claims to and liens upon the property, and, in all cases where a claim or interest of the Uned therein is established, may decree a sale of such property." (emphasis added), and respondents argue that this language allows a district court hearing a 7403 proceeding to exercise a degree of equable discretion and refuse to authorize a forced sale in a particular case. See ; Uned v. Eaves, 499 F.2d ; Uned v. Hershberger, 475 F. 2d, at 679-680; Uned v. Overman, 424 F. 2d, at ; Uned v. Morrison, The Court of Appeals agreed *706 wh this interpretation of the statute, although does not appear to have relied on and in any event neher nor the District Court undertook any particularized equable assessment of the cases now before us. We find the question to be close, but on balance, we too conclude that 7403 does not require a district court to authorize a forced sale under absolutely all circumstances, and that some limed room is left in the statute for the exercise of reasoned discretion. B The word "may," when used in a statute, usually implies some degree of discretion.[34] This common-sense principle of statutory construction is by no means invariable, however, see 258- ; see generally Uned ex rel. 156 U.S. 3, 9-0 and cases ced, and can be defeated by indications of legislative intent to the contrary or by obvious inferences from the structure and purpose of the statute, see In these cases, we have ltle to go on in discerning Congress' intent except for one crucial fact: before 19, the predecessor statute to 7403 used the word "shall" rather than the word "may" in describing the court's role in ordering a forced sale of property in which a claim or interest of the Uned had been shown. Revenue Act of 1926, Pub. L. 20, 44 Stat. (part 2) 9, 123-124. In 19, as one of a number of amendments in the text of the provision, Congress changed "shall" to "may." Revenue Act of 19, Pub. L. 740, 802, 1743-1744. The other changes specifically, expanding the scope of 7403 to include personal as well as real property, and adding the receivership option *707 now embodied in 7403(d), see at 681 are explained in the legislative history.[] There is no direct explanation for the change from "shall" to "may."[] The Government argues that the only significance of the change from "shall" to "may" was that "Congress recognized had specifically authorized sale of interests in property, sale of the entire property, and receivership. Employing the term `shall' wh respect to each may have been perceived as confusing insofar as could be read as directing contradictory requirements." Reply Brief for Uned 8, n. 5. *708 We find this explanation plausible, but not compelling. If Congress had really meant no more than to adjust the forced sale language to take into account the receivership option, could have easily expressed that intention more clearly by language to the effect of "the court shall eher decree the sale of such property or, upon the instance of the Uned appoint a receiver to enforce the lien, etc." Moreover, the authors of an earlier, unpassed, otherwise virtually identical proposal introduced in the House, did not think necessary to change "shall" to "may" in their version of the legislation. See nn. Faced as we are wh such an ambiguous legislative record, we come to rest wh the natural meaning of the language enacted into law. In light of the fact that Congress did see f to explain the other changes in the 19 Act, we do not assert that Congress, whout comment or explanation, intended to create equable discretion where none existed before. On the other hand, there is support in our prior cases for the proposion that an unexplained change in statutory wording from "shall" to "may" is best construed as indicating a congressional belief that equable discretion existed all along. Moore v. Illinois Central R. 6 ; cf. In addion, reading "may" as eher conferring or confirming a degree of equable discretion conforms to the even more important principle of statutory construction that Congress should not lightly be assumed to have enacted a statutory scheme foreclosing a court of equy from the exercise of s tradional discretion. ; Porter v. Warner Holding ; Hecht v. Bowles, A 7403 proceeding is by s nature a proceeding in equy,[37] and judicial sales in general have tradionally *709 been accompanied by at least a limed degree of judicial discretion.[38] Finally, we are convinced that recognizing that district courts may exercise a degree of equable discretion in 7403 proceedings is consistent wh the policies of the statute: unlike an absolute exception, which we rejected above, the exercise of limed equable discretion in individual cases can take into account both the Government's interest in prompt and certain collection of delinquent taxes and the possibily that innocent third parties will be unduly harmed by that effort. C To say that district courts need not always go ahead wh a forced sale authorized by 7403 is not to say that they have unbridled discretion. We can think of virtually no circumstances, for example, in which would be permissible to refuse to authorize a sale simply to protect the interests of the delinquent taxpayer himself or herself.[39] And even when the interests of third parties are involved, we think that a *710 certain fairly limed set of considerations will almost always be paramount. First, a court should consider the extent to which the Government's financial interests would be prejudiced if were relegated to a forced sale of the partial interest actually liable for the delinquent taxes. Even the Government seems to concede that, if such a partial sale would not prejudice at all (because the separate market value of the partial interest is likely to be equal to or greater than s value as a fraction of the total value of the entire property) then there would be no reason at all to authorize a sale of the entire property. Tr. of Oral Arg. 7, 13; Reply Brief for Uned 8, n. 5.[40] We think that a natural extension of this principle, however, is that, even when the partial interest would be worth less sold separately than sold as part of the entire property, the possibily of prejudice to the Government can still be measured as a matter of degree. Simply put, the higher the expected market price, the less the prejudice, and the less weighty the Government's interest in going ahead wh a sale of the entire property.[41] Second, a court should consider whether the third party wh a nonliable separate interest in the property would, in the normal course of events (leaving aside 7403 and eminent domain proceedings, of course), have a legally recognized expectation that that separate property would not be subject *711 to forced sale by the delinquent taxpayer or his or her credors. If there is no such expectation, then there would seem to be ltle reason not to authorize the sale. Again, however, this factor is amenable to considerations of degree. The Texas homestead laws are almost absolute in their protections against forced sale.[42] The usual cotenancy arrangement, which allows any cotenant to seek a judicial sale of the property and distribution of the proceeds, but which allows the other cotenants to resist the sale and apply instead for a partion in kind, is further along the continuum. And a host of other types of property interests are arrayed between and beyond. Third, a court should consider the likely prejudice to the third party, both in personal dislocation costs and in the sort of practical undercompensation Fourth, a court should consider the relative character and value of the nonliable and liable interests held in the property: if, for example, in the case of real property, the third party has no present possessory interest or fee interest in the property, there may be ltle reason not to allow the sale; if, on the other hand, the third party not only has a possessory interest or fee interest, but that interest is worth 99% of the value of the property, then there might well be virtually no reason to allow the sale to proceed. We do not pretend that the factors we have just outlined constute an exhaustive list; we certainly do not contemplate that they be used as a "mechanical checklist" to the exclusion of common sense and consideration of special circumstances. Cf. Moses H. Cone Hospal v. Mercury Construction Corp., We do emphasize, however, that the limed discretion accorded by 7403 should be exercised rigorously and sparingly, keeping in mind the Government's paramount interest in prompt and certain collection of delinquent taxes. *712 V In these cases, no individualized equable balance of the sort we have just outlined has yet been attempted. In the Rodgers case, the record before us, although is que clear as to the legal issues relevant to the second consideration noted above, affords us ltle guidance otherwise. In any event, we think that the task of exercising equable discretion should be left to the District Court in the first instance. The Ingram case is a b more complicated, even leaving aside the fact of the stipulated sale by which we are constrained to treat the escrow fund now sting in the registry of the District Court as if were a house. First, as the Court of Appeals pointed out, there remains a question under Texas law as to whether Joerene Ingram abandoned the homestead by the time of the stipulated sale. Second, the Government, in addion to s lien for the individual debt of Donald Ingram, has a further lien for $283.33, plus interest, on the house, representing the joint liabily of Donald and Joerene Ingram. Because Joerene Ingram is not a "third party" as to that joint liabily, we can see no reason, as long as that amount remains unpaid, not to allow a "sale" of the "house" (i. e., a levy on the proceeds of the stipulated sale) for satisfaction of the debt. Moreover, once the dam is broken, there is no reason, under our interpretation of 7403, not to allow the Government to collect on the individual debt of Donald Ingram out of that portion of the proceeds of the sale representing property interests properly liable for the debt. On the other hand, would certainly be to Mrs. Ingram's advantage to discharge her personal liabily before the Government can proceed wh s "sale," in which event, assuming that she has not abandoned the homestead, the District Court will be obliged to strike an equable balance on the same general principles as those that govern the Rodgers case. The judgment of the Court of Appeals in Rodgers is reversed, s judgment in Ingram is vacated, and both cases *713A are remanded wh directions that they be remanded to the District Court for further proceedings consistent wh this opinion. So ordered. *713B JUSTICE BLACKMUN, wh whom JUSTICE REHNQUIST, JUSTICE STEVENS, and JUSTICE O'CONNOR join, concurring in the result in part and dissenting in part. The Court today properly rejects the broad legal principle concerning 26 U.S. C. 7403 that was announced by the Court of Appeals. See ante, at 687-688 and 690-691. I agree that, in some suations, 7403 gives the Government the power to sell property not belonging to the taxpayer. Our task, however, is to ascertain how far Congress intended that power to extend. In my view, 7403 confers on the Government the power to sell or force the sale of jointly owned property only insofar as the tax debtor's interest in that property would perm him to do so; does not confer on the Government the power to sell jointly owned property if an unindebted co-owner enjoys an indestructible right to bar a sale and to continue in possession. Because Mrs. Rodgers had such a right, and because she is not herself indebted to the Government, I dissent from the Court's disposion of her case. I It is basic in the common law that a lienholder enjoys rights in property no greater than those of the debtor himself; that is, the lienholder does no more than step into the debtor's shoes. 1 L. Jones, Law of Liens 9, pp. 9-10 (1914). Thus, as a general rule, "[t]he lien of a judgment cannot be made effectual to bind or to convey any greater or other estate than the debtor himself, in the exercise of his rights, could voluntarily have transferred or alienated." 49 C. J. S., Judgments 478 (7) (collecting cases); Commercial Cred v. Davidson, ; Similarly, pursuant to a state tax lien, "no greater interest in land than that *714 which was held by the taxpayer and taxable to him may be sold, so that, where a sale is had for unpaid taxes on a leasehold estate, only the leasehold estate is subject to conveyance."[1] 85 C. J. S., Taxation 806 (1954) (footnote omted) (collecting cases); Uned v. Erie County, 31 F. Supp. The lienholder may compel the debtor to exercise his property rights in order to meet his obligations or the lienholder may exercise those rights for him. But the debtor's default does not vest in the lienholder rights that were not available to the debtor himself. In most suations in which a delinquent taxpayer shares property wh an unindebted third party, does no violence to this principle to order a sale of the entire property so long as the third party is fully compensated. A joint owner usually has at his disposal the power to convey the property or force s conveyance. Thus, for example, a joint tenant or tenant in common may seek partion. See generally W. Federal Tax Liens If a joint tenant is delinquent in his taxes, the Uned does no more than step into the delinquent taxpayer's shoes when compels a sale.[2] *715 In a small number of joint-ownership suations, however, the delinquent taxpayer has no right to force partion or otherwise to alienate the entire property whout the consent of the co-owner. These include tenancies by the entirety and certain homestead estates. See Federal Liens and Priories Agenda for the Next Decade II, 77 Yale L. J. 5, 634 In this case, the homestead estate owned by the delinquent taxpayer Mrs. Rodgers' deceased husband did not include the right to sell or force the sale of the homestead during Mrs. Rodgers' lifetime whout her consent. Mrs. Rodgers had, and still has, an indefeasible right to possession, an interest, as the Court recognizes, "akin to an undivided life estate." Ante, at 686. A lienholder stepping into the shoes of the delinquent taxpayer would not be able to force a sale. II By holding that the District Court has the discretion to order a sale of Mrs. Rodgers' property, the Court necessarily finds in the general language of 7403 a congressional intent to abrogate the rule that the tax collector's lien does not afford him rights in property in excess of the rights of the delinquent taxpayer.[3] I do not dispute that the general *7 language of 7403, standing alone, is subject to the interpretation the Court gives From s enactment in 1868[4] to the present day, the language of this statute has been sweeping; read lerally, adms of no exceptions. But when broadly worded statutes, particularly those of some antiquy, are in derogation of common-law principles, this Court has hesated to heed arguments that they should be applied lerally. See In such cases, the Court has presumed in the absence of a clear indication to the contrary that Congress did not mean by s use of general language to contravene fundamental precepts of the common law.[5] *717 A Apart from the general language of the statute, the Court points to nothing indicating a congressional intent to abrogate the tradional rule. It seems to me, indeed, that the evidence definely points the other way. Scholarly comment on 7403, and on 6321, the tax lien provision, consistently has maintained that, in such as Texas that confer on each spouse absolute rights to full use and possession of the homestead for life, the homestead property rights of an unindebted spouse may not be sold by the tax collector to satisfy the other spouse's tax debt.[6] Court decisions addressing *718 this point have been to the same [7] In 1966, the American Bar Association placed before Congress this virtually undisputed view of the law of federal tax liens. Legislative History 177.[8] Since 19, Congress repeatedly has addressed *719 the law of federal tax liens, directing some attention to 7403.[9] Against the background of this consensus among courts and commentators that tax liens may not be enforced against such homesteads so long as an unindebted spouse still lives, Congress did not change the law. In fact, in 1954 the Senate foiled an attempt by the House to extend the reach of federal tax liens to tenancies by the entirety, a spousal property interest similar to the Texas homestead.[10] The rule pronounced in the courts, e. g., Uned v. Hutcherson, (CA8 19); Uned v. Nathanson, F. Supp. 193, and the view of the commentators, e. g., at 254; at 17, was that tenancies by the entirety, like Texas homesteads, could not be sold to enforce the tax liabily of one The House passed *720 an amendment that would have extended the tax lien created by 6321 expressly to the taxpayer's interest as tenant by the entirety. H. R. 8300, 83d Cong., 2d Sess., 6321 (1954) (Code bill). The Senate removed the language, stating: "The deletion of the phrase is intended to continue the existing law." S. Rep. No. 22, 83d Cong., 2d Sess., 5 (1954). It is true, of course, that tenancies by the entirety were held to be immune from federal tax sales on a theory different from that applied to homestead property like Mrs. Rodgers'. See ante, at 703-704, 1. But was established that both types of property interests precluded the Government from satisfying the tax debts of one spouse by selling the jointly owned property. In the absence of any evidence of congressional intent to the contrary, this deliberate choice to leave undisturbed the bar to tax enforcement created by a tenancy by the entirety[11] suggests that Congress did not object to the similar effect of the Texas homestead right, an effect consistent wh principles basic to the common law of liens. *721 B Although disclaiming as a basis for decision, the Court relies on 1 U.S. 326, to support s reading of 7403. Ante, at 691-692, n. 17. In Mansfield, a tenant who operated a distillery on leased property fell delinquent in s taxes. The Government sought to sell by administrative levy the entire fee, not just the tenant's leasehold interest. The fee was owned by a third party, and the delinquent taxpayer's leasehold interest obviously did not give him the power to sell the fee. The Mansfield Court would not allow a sale by administrative levy, but suggested that on the facts of that case, the Government could seek a judicial sale of the entire property under the predecessor of 7403. Focusing on just this portion of the Mansfield opinion, the Court now states that "[r]ead broadly, Mansfield is on `all fours' wh our holding today." Ante, at 692, n. 17. To the contrary, Mansfield is not on "all fours" wh today's holding, and indeed undermines In the same 1868 Act in which passed the original predecessor to 7403, Congress enacted a separate provision to ensure the collection of taxes from distillers. Section 8 of that Act required each distiller to own s distillery property in fee and free from liens. Alternatively, a distiller could file wh the tax collector the fee owner's wrten consent granting a tax lien of the Uned priory over all other claims to the property, and granting the Uned full tle in the property in case of forfeure. Act of July 20, 1868, ch. 186, 8, The taxpayer's landlord in Mansfield had executed such a waiver, and the Court stated that "the val question" was the waiver's 1 U.S., at 338. Rejecting the Government's posion, the Court held that the waiver did not perm sale of the property by administrative levy. The Court made clear, however, that s reading of the statute did *722 not render the waiver requirement useless. "By the waiver the government acquired the right, by a su [under the predecessor of 7403], to have sold, under the decree of a court, not only the distiller's leasehold interest, but the fee in the premises." Thus, the Mansfield Court considered the waiver to be a condion precedent to the Government's power, under the predecessor of 7403, to sell the landlord's fee interest when the tenant was in default in s taxes. If 7403 gives the Government this power whout the necessy of a waiver as the Court today holds seems unlikely that Congress would have considered necessary, in the very Act in which passed 7403's predecessor, to require that a distiller eher own the fee outright or obtain from s landlord advance authorization for a sale of the fee to satisfy the distiller's tax liabilies.[12] Outside the distillery context, Congress must have intended that the Government's power to force a sale of the fee would be no more extensive than that of the delinquent taxpayer. *723 C The Court's "broad reading" of Mansfield's holding reflects only the extraordinary breadth of s own. As read by the Court, Mansfield authorizes, whout the consent of the owner of the fee, a judicial sale of a building should a tenant fail to pay his taxes, a judicial sale of a farm should the holder of an easement across become delinquent,[13] or a judicial sale of a condominium or cooperative apartment house to satisfy the tax debt of any co-owner.[14] The Court imputes to Congress an intent to perm the sale of the farm or the building even though the fee owners have paid their taxes and even though, in signing a lease or conveying an easement, the fee owners did not surrender their indefeasible right to prevent the sale of their property. Prior to 19, moreover, the predecessor of 7403(c) required a court at the Government's request to sell the property *724 in which the tax debtor had an interest. See ante, at 7009. Thus, the Court's view attributes to Congress the incredible intention to mandate the sale of the entire property whenever the holder of an easement, a tenant, or one wh a similarly minimal interest fails to pay a tax and the Government invokes s right to bring an action to enforce s lien. It is hardly surprising that counsel for the Government has been unable to ce a single instance before or after this Court's decision in Mansfield in which the Government, outside the context of the homestead cases, invoked 7403 or s predecessors to assert a property right greater than the tax-payer himself could have asserted. Tr. of Oral Arg. 14-. To abrogate the common-law rule that the tax collector gains only the property rights of the tax debtor leads to absurd results. III Whout direct evidence of congressional intent to contravene the tradional and sensible common-law rule, the Court advances three arguments purporting to lend indirect support for s construction of 7403. A First, the Court claims that s construction is consistent wh the policy favoring "the prompt and certain collection of delinquent taxes." Ante, at 694. This rationale would support any exercise of governmental power to secure tax payments. Were there two equally plausible supposions of congressional intent, this policy might counsel in favor of choosing the construction more favorable to the Government. But when one interpretation contravenes both tradional rules of law and the common sense and common values on which they are built, the fact that favors the Government's interests cannot be disposive.[15] *725 Moreover, the Government's interest would not be compromised substantially by a rule permting to sell property only when the delinquent taxpayer could have done so. In this case, the delinquent taxpayer's homestead interest, is assumed, gave him a "half-interest in the underlying ownership rights to the property being sold." Ante, at 699. An immediate forced sale of the entire property would yield for the Government no more than half the present value of the remainder interest, the residue left after the present values of the nondelinquent spouse's life estate and half-interest in the remainder are subtracted. As the Court notes, the Government can expect to receive only a small fraction of the proceeds. An immediate sale of the delinquent taxpayer's future interest in the property might well command a commensurate price. Alternatively, the Government could maintain s lien on the property until Mrs. Rodgers dies and then could force a sale. Because the delinquent taxpayer's estate retains a half-interest in the remainder, the Government would be entled to half of the proceeds at that time. The Government's yield from this future sale, discounted to s present value, should not differ significantly from s yield under the Court's approach. The principal difference is that, following the common-law rule, Mrs. Rodgers' entlement to live out her life on her homestead would be respected. An approach consistent wh the common law need not prejudice the Government's interest in the "certain" collection of taxes. Under 7403(d),[] the District Court has the power to appoint a receiver, who could supervise the property to protect the Government's interests while respecting Mrs. Rodgers' rights to possession and enjoyment. *726 77 Yale L. J., at 638. Indeed, just such an approach was suggested by the American Bar Association's Commtee on Federal Liens, 84 A. B. A. Rep. 645, 681-682 (1959), which drafted the tax lien amendments adopted in 1966. Legislative History 108-109 (statement of Laurens Williams). B The Court would support s construction by contrasting 7403 wh the more restrictive language of 6, the administrative tax levy provision. Ante, at 695-697. It is true that 6 perms the sale only of "property and rights to property belonging to" the taxpayer, while 7403 generally authorizes the sale of property in which the taxpayer has an interest. But the greater power conferred by 7403 is needed to enable the Government to seek the sale of jointly owned property whenever the tax debtor's rights in the property would have permted him to seek a forced sale. Section 7403 certainly perms the Government, in such circumstances, to seek partion of the property in federal, rather than state, court, to seek authory to sell the tax debtor's part or the whole, and, in the same proceeding, to have determined the entlements of the various claimants, including competing lienholders, to the proceeds of the property sold. See generally 77 Yale L. J., at 628-629. Absent the more expansive language of 7403, this would not be possible. That language, however, does not manifest congressional intent to produce the extraordinary consequences yielded by the Court's interpretation. C The Court asserts that s construction of 7403 is consistent wh "the tradional powers of a taxing authory in an in rem enforcement proceeding," even if is not consistent wh the tradional rights of lienholders. Ante, and 702. This, wh all respect, is not so. In rem tax enforcement proceedings never have been used to sell property *727 belonging to unindebted third parties in order to satisfy a tax delinquency unrelated to the property sold. As the Court recognizes, ante, at 694, such proceedings are brought to sell land in order to satisfy delinquent ad valorem taxes assessed on the land self. 2 T. Law of Taxation 866, 910 (3d ed. 1903). It is said that the land self is liable for such taxes, and that conflicting ownership rights thus do not bar s sale. See ; H. Law of Tax Tles 296 ; W. Law of Taxation 346-349 (1877). The cases relied upon by the Court for the proposion that in rem tax proceedings extinguish the homestead rights of an unindebted spouse merely applied this rule. 142 Iowa 9, ; ; On the other hand, if the tax is assessed on an individual's separate interest in the land, rather than on the land self, the tax debt is personal to the individual and "[n]othing more [than the individual's interest] can become delinquent; nothing more can be sold." ; see R. well, On the Power to Sell Land 908, 920, 942 (5th ed. 1889); 2 at ; The real property interests of third parties cannot be sold through an in rem proceeding to satisfy a personal tax liabily. The "tradional powers of a taxing authory" to sell the entire property and extinguish the interests of unindebted third parties thus are limed to collection of taxes assessed on the land self, and have no application to delinquent taxes, like those at issue in these cases, assessed personally against one joint owner.[17] *728 Some is true, have authorized by statute the sale of real property to satisfy the owner's tax debts, even where the delinquent taxes are unrelated to the property. See Larimer ; Iowa Land v. Douglas County, 8 S. D. 491 (1896). The Court does not suggest, however, that jointly owned real property ever has been sold pursuant to such a statute when an unindebted co-owner has indefeasible rights therein. Indeed, the tradional distinction between taxes for which the land is liable and tax liabilies personal to the taxpayer would preclude such a sale. Thus, even if one purpose of 7403's predecessor statute "was to obtain for the federal tax collector some of the advantages that many enjoyed through in rem tax enforcement," ante, at 695, Congress would not have intended the result the Court reaches today. A state tax collector could not confiscate the indefeasible real property interests of a nondelinquent third party to satisfy the personal tax liabily of a co-owner.[18] *729 IV The Court recognizes that Mrs. Rodgers has an indestructible property right under Texas law to use, possess, and enjoy her homestead during her lifetime, and that the delinquent taxpayer's property interests would not have enabled him to disturb that right against her will. Ante, The Court recognizes that Mrs. Rodgers has no outstanding tax liabily and that the Government has no lien on Mrs. Rodgers' property or property rights. Because I conclude that Congress did not intend 7403 to perm federal courts to grant property rights to the Government greater than those enjoyed by the tax debtor, I would hold that the Government may not sell Mrs. Rodgers' homestead whout her consent. To the extent the Court holds to the contrary, I respectfully dissent. V Mrs. Ingram's case, however, is materially different. Like her husband, Mrs. Ingram was liable for back taxes, and consequently the Government had a lien on her interests in property as well as on her husband's interests. Exercising both spouses' rights in the homestead, the Government is entled *730 to force a sale, ; see (CA5 2), subject only to the discretion of the District Court. See ante, at 703-711. Second, when Mrs. Ingram and her former husband were divorced, the homestead became subject to partion under Texas law. See ante, at 685, n. 10. In Mrs. Ingram's case, therefore, I concur in the result. |
Justice Blackmun | concurring | false | United States v. Security Industrial Bank | 1982-11-30T00:00:00 | null | https://www.courtlistener.com/opinion/110811/united-states-v-security-industrial-bank/ | https://www.courtlistener.com/api/rest/v3/clusters/110811/ | 1,982 | 1982-007 | 1 | 9 | 0 | This case concerns the Bankruptcy Act of 1978, 11 U.S. C. § 101 et seq. (1976 ed., Supp. V), and, in particular, the exemption provisions of § 522 of that Act. Specifically at issue is the effect of certain of these exemption provisions upon nonpossessory, nonpurchase-money obligations given by debtors to small loan companies before the enactment of the *83 Act. The purported liens apply generally, not specifically, to property of the kind described and, as a practicable matter, there is nothing to prevent the debtor's selling the property and replacing it or not replacing it, just as he chooses.
Section 522, for the first time, established a set of federal exemptions for individual debtors. Concededly, the section, as all similar statutes, was enacted to protect the debtor's essential needs and to enable him to have a fresh start economically. Section 522(f)(2) permits the debtor to "avoid the fixing" of a nonpossessory, nonpurchase-money security interest in certain property, but the subsection does not extend to all property otherwise exempt under § 522(d). It is limited to certain personal items, such as household furnishings, wearing apparel, jewelry, tools of the debtor's trade, and professionally prescribed health aids.
The Court naturally struggles with the question of the application of the new exemption provisions to obligations created before the new Act. It notes its concern with constitutional problems and it also greets with obvious relief the possibility of construing the Act as being only prospective in its operation. It then quickly pursues the latter route in order to avoid any constitutional issue.
I understand and can sympathize with the Court's desire thus to resolve the case. It is usually much easier to construe a statute so as to avoid a constitutional issue than it is to resolve the constitutional issue itself. And, of course, the Court's cases have announced that, where feasible, this is the preferred method. See, e. g., Lorillard v. Pons, 434 U.S. 575, 577 (1978).
Were we writing on a "clean slate," however, I would not pursue, in this case, that principle of construction-preference, for I think that the case would deserve consideration in greater depth. I see nothing in the statute with which we are concerned that speaks or hints of only prospective applicability, or that compels it, and I would find it necessary to reach the constitutional issue. I would then resolve that *84 issue in favor of the debtor and against the small-loan-company creditor. I would do so because the exemptions in question are limited as to kinds of property and as to values; because the amount loaned has little or no relationship to the value of the property; because these asserted lien interests come close to being contracts of adhesion; because repossessions by small loan companies in this kind of situation are rare; because the purpose of the statute is salutary and is to give the debtor a fresh start with a minimum for necessities; because there has been creditor abuse; because Congress merely has adjusted priorities, and has not taken for the Government's use or for public use; because the exemption provisions in question affect the remedy and not the debt; because the security interest seems to have little direct value and weight in its own right and appears useful mainly as a convenient tool with which to threaten the debtor to reaffirm the underlying obligation; because the statute is essentially economic regulation and insubstantial at that; and because there is an element of precedent favorable to the debtor to be found in such cases as Penn Central Transp. Co. v. New York City, 438 U.S. 104 (1978), and PruneYard Shopping Center v. Robins, 447 U.S. 74 (1980).
But we are not writing on a clean slate. It seems to me that the case of Holt v. Henley, 232 U.S. 637 (1914), is precisely in point and, unless the Court chooses to overrule it, must control the present case. There, Holt and the eventual bankrupt signed an agreement in 1909 for the installation of an automatic sprinkler system on the property of the eventual bankrupt. The agreement specified that the system was to remain Holt's property until paid for and that he was to have a right to enter and remove it upon failure to pay as agreed. Thereafter, but also in 1909, a mortgage deed was executed covering the plant and what was "acquired and placed upon the said premises during the continuance of this trust." Id., at 639. Section 8 of the Act of June 25, 1910, ch. 412, 36 Stat. 840, amended § 47a(2) of the then Bankruptcy *85 Act to give the trustee in bankruptcy, as to property coming into the custody of the bankruptcy court, the rights of a creditor holding a lien. Upon Holt's debtor's bankruptcy, the mortgagees claimed the sprinkler system.
Justice Holmes, writing for a unanimous Court, observed that before the amendment "Holt had a better title than the trustees would have got" and that the Court was of the opinion "that the act should not be construed to impair it." 232 U.S., at 639. He went on:
"We do not need to consider whether or how far in any event the constitutional power of Congress would have been limited. It is enough that the reasonable and usual interpretation of such statutes is to confine their effect, so far as may be, to property rights established after they were passed. . . . That is a familiar and natural mode of interpretation . . . . We are of opinion that [Holt's title] was not affected by the enactment of later date than the conditional sale. The opposite construction would not simply extend a remedy but would impute to the act of Congress an intent to take away rights lawfully retained, and unimpeachable at the moment when they took their start." Id., at 639-640.
The Court then ruled against the claim of the mortgagees because they had made no advance on the faith of the sprinkler system and were not purchasers for value as against Holt, and because removal "would not affect the integrity of the structure on which the mortgagees advanced." Id., at 641.
Holt v. Henley thus also involved a pre-existing agreement, a subsequent change in the then Bankruptcy Act, and the Court's preservation of the pre-existing right. I see no way to distinguish that case from this one, and I would affirm the judgment of the Court of Appeals simply on the compelling authority of Holt v. Henley. See also Auffm'ordt v. Rasin, 102 U.S. 620, 622 (1881). I would much prefer to avoid in this way the dicta the Court enunciates with respect to "takings."
| This case concerns the Bankruptcy Act of 1978, 11 U.S. C. 101 et seq. (1976 ed., Supp. V), and, in particular, the exemption provisions of 522 of that Act. Specifically at issue is the effect of certain of these exemption provisions upon nonpossessory, nonpurchase-money obligations given by debtors to small loan companies before the enactment of the *83 Act. The purported liens apply generally, not specifically, to property of the kind described and, as a practicable matter, there is nothing to prevent the debtor's selling the property and replacing it or not replacing it, just as he chooses. Section 522, for the first time, established a set of federal exemptions for individual debtors. Concededly, the section, as all similar statutes, was enacted to protect the debtor's essential needs and to enable him to have a fresh start economically. Section 522(f)(2) permits the debtor to "avoid the fixing" of a nonpossessory, nonpurchase-money security interest in certain property, but the subsection does not extend to all property otherwise exempt under 522(d). It is limited to certain personal items, such as household furnishings, wearing apparel, jewelry, tools of the debtor's trade, and professionally prescribed health aids. The Court naturally struggles with the question of the application of the new exemption provisions to obligations created before the new Act. It notes its concern with constitutional problems and it also greets with obvious relief the possibility of construing the Act as being only prospective in its operation. It then quickly pursues the latter route in order to avoid any constitutional issue. I understand and can sympathize with the Court's desire thus to resolve the case. It is usually much easier to construe a statute so as to avoid a constitutional issue than it is to resolve the constitutional issue itself. And, of course, the Court's cases have announced that, where feasible, this is the preferred method. See, e. g., Were we writing on a "clean slate," however, I would not pursue, in this case, that principle of construction-preference, for I think that the case would deserve consideration in greater depth. I see nothing in the statute with which we are concerned that speaks or hints of only prospective applicability, or that compels it, and I would find it necessary to reach the constitutional issue. I would then resolve that *84 issue in favor of the debtor and against the small-loan-company creditor. I would do so because the exemptions in question are limited as to kinds of property and as to values; because the amount loaned has little or no relationship to the value of the property; because these asserted lien interests come close to being contracts of adhesion; because repossessions by small loan companies in this kind of situation are rare; because the purpose of the statute is salutary and is to give the debtor a fresh start with a minimum for necessities; because there has been creditor abuse; because Congress merely has adjusted priorities, and has not taken for the Government's use or for public use; because the exemption provisions in question affect the remedy and not the debt; because the security interest seems to have little direct value and weight in its own right and appears useful mainly as a convenient tool with which to threaten the debtor to reaffirm the underlying obligation; because the statute is essentially economic regulation and insubstantial at that; and because there is an element of precedent favorable to the debtor to be found in such cases as Penn Central Transp. and PruneYard Shopping But we are not writing on a clean slate. It seems to me that the case of is precisely in point and, unless the Court chooses to overrule it, must control the present case. There, Holt and the eventual bankrupt signed an agreement in 1909 for the installation of an automatic sprinkler system on the property of the eventual bankrupt. The agreement specified that the system was to remain Holt's property until paid for and that he was to have a right to enter and remove it upon failure to pay as agreed. Thereafter, but also in 1909, a mortgage deed was executed covering the plant and what was "acquired and placed upon the said premises during the continuance of this trust." Section 8 of the Act of June 25, 1910, ch. 412, amended 47a(2) of the then Bankruptcy *85 Act to give the trustee in bankruptcy, as to property coming into the custody of the bankruptcy court, the rights of a creditor holding a lien. Upon Holt's debtor's bankruptcy, the mortgagees claimed the sprinkler system. Justice Holmes, writing for a unanimous Court, observed that before the amendment "Holt had a better title than the trustees would have got" and that the Court was of the opinion "that the act should not be construed to impair it." 232 U.S., He went on: "We do not need to consider whether or how far in any event the constitutional power of Congress would have been limited. It is enough that the reasonable and usual interpretation of such statutes is to confine their effect, so far as may be, to property rights established after they were passed. That is a familiar and natural mode of interpretation We are of opinion that [Holt's title] was not affected by the enactment of later date than the conditional sale. The opposite construction would not simply extend a remedy but would impute to the act of Congress an intent to take away rights lawfully retained, and unimpeachable at the moment when they took their start." -640. The Court then ruled against the claim of the mortgagees because they had made no advance on the faith of the sprinkler system and were not purchasers for value as against Holt, and because removal "would not affect the integrity of the structure on which the mortgagees advanced." thus also involved a pre-existing agreement, a subsequent change in the then Bankruptcy Act, and the Court's preservation of the pre-existing right. I see no way to distinguish that case from this one, and I would affirm the judgment of the Court of Appeals simply on the compelling authority of See also I would much prefer to avoid in this way the dicta the Court enunciates with respect to "takings." |
Justice Marshall | majority | false | United States v. Culbert | 1978-03-28T00:00:00 | null | https://www.courtlistener.com/opinion/109821/united-states-v-culbert/ | https://www.courtlistener.com/api/rest/v3/clusters/109821/ | 1,978 | 1977-057 | 1 | 8 | 0 | Respondent was convicted of violating the Hobbs Act, 18 U.S. C. § 1951 (1976 ed.), which provides in relevant part:
"Whoever in any way or degree obstructs, delays, or affects commerce or the movement of any article or commodity in commerce, by robbery or extortion or attempts or conspires so to do, or commits or threatens physical *372 violence to any person or property in furtherance of a plan or purpose to do anything in violation of this section shall be fined not more than $10,000 or imprisoned not more than twenty years, or both." § 1951 (a).
The question in this case is whether the government not only had to establish that respondent violated the express terms of the Act, but also had to prove that his conduct constituted "racketeering."
The evidence at respondent's jury trial showed that he and an accomplice attempted to obtain $100,000 from a federally insured bank by means of threats of physical violence made to the bank's president. The United States Court of Appeals for the Ninth Circuit, with one judge dissenting, reversed the Hobbs Act conviction,[1] holding that, "`although an activity may be within the literal language of the Hobbs Act, it must constitute "racketeering" to be within the perimeters of the Act.'" 548 F.2d 1355, 1357, quoting United States v. Yokley, 542 F.2d 300, 304 (CA6 1976). We granted certiorari, 434 U.S. 816 (1977),[2] and we now reverse.
*373 I
Nothing on the face of the statute suggests a congressional intent to limit its coverage to persons who have engaged in "racketeering." To the contrary, the statutory language sweeps within it all persons who have "in any way or degree . . . affect[ed] commerce . . . by robbery or extortion." 18 U.S. C. § 1951 (a) (1976 ed.). These words do not lend themselves to restrictive interpretation; as we have recognized, they "manifest . . . a purpose to use all the constitutional power Congress has to punish interference with interstate commerce by extortion, robbery or physical violence," Stirone v. United States, 361 U.S. 212, 215 (1960). The statute, moreover, carefully defines its key terms, such as "robbery," "extortion," and "commerce."[3] Hence the absence of any reference to "racketeering"much less any definition of the wordis strong evidence that Congress did not intend to make "racketeering" an element of a Hobbs Act violation.
*374 Respondent nevertheless argues that we should read a racketeering requirement into the statute. To do so, however, might create serious constitutional problems, in view of the absence of any definition of racketeering in the statute. Neither respondent nor either of the two Courts of Appeals that have read this requirement into the statute has even attempted to provide a definition. Without such a definition, the statute might well violate "the first essential of due process of law": It would forbid "the doing of an act in terms so vague that [persons] of common intelligence [would] necessarily [have to] guess at its meaning and differ as to its application." Connally v. General Constr. Co., 269 U.S. 385, 391 (1926); see, e. g., Hynes v. Mayor of Oradell, 425 U.S. 610, 620 (1976). But we need not concern ourselves with these potential constitutional difficulties because a construction that avoids them is virtually compelled by the language and structure of the statute.
II
A
Nothing in the legislative history supports the interpretation of the statute adopted by the Court of Appeals.[4] The predecessor to the Hobbs Act, the Anti-Racketeering Act of 1934, ch. 569, 48 Stat. 979, was enacted, as its name implies, at a time when Congress was very concerned about racketeering activities. Despite these concerns, however, the Act, which was written in broad language similar to the language of the *375 Hobbs Act, nowhere mentioned racketeering.[5] This absence of the term is not surprising, since the principal congressional committee working on the Act, known as the Copeland Committee, found that the term and the associated word "racket" had "for some time been used loosely to designate every conceivable sort of practice or activity which was either questionable, unmoral, fraudulent, or even disliked, whether criminal or not." S. Rep. No. 1189, 75th Cong., 1st Sess., 2 (1937).[6]
The Copeland Committee proceeded to develop its own "working definition" of racketeering, but it did not incorporate *376 this definition into the Act. Ibid. Critical to the definition was the existence of "an organized conspiracy to commit the crimes of extortion or coercion." Id., at 3. Yet the Act itself did not require a conspiracy to engage in unlawful conduct, and the Senate Judiciary Committee Report expressly stated that a violation of the Act would be established "`whether the restraints [of commerce] are in form of conspiracies or not,'" S. Rep. No. 532, 73d Cong., 2d Sess., 2 (1934), quoting Justice Department memorandum; see H. R. Rep. No. 1833, 73d Cong., 2d Sess., 2 (1934). Moreover, the Act included a separate prohibition on conspiracies, § 2 (d), 48 Stat. 980; see n. 5, supra, that would have been superfluous if proof of racketeeringas defined by the Copeland Committee to require conspiracywere an integral element of the substantive offenses.[7] There is nothing in the legislative history to dispel the conclusion compelled by these observations. Congress simply did not intend to make racketeering a separate, unstated element of an Anti-Racketeering Act violation.
B
Given the absence of this intent in the Hobbs Act's predecessor, any requirement that racketeering be proved must be derived from the Hobbs Act itself or its legislative history. While the Hobbs Act was enacted to correct a perceived deficiency in the Anti-Racketeering Act, that deficiency had nothing to do with the element of racketeering. See United States v. Enmons, 410 U.S. 396, 401-404 (1973). Rather, it involved the latter Act's requirement that the proscribed "force, violence or coercion" lead to exaction of "valuable consideration" and its exclusion of wage payments from the definition of consideration. See n. 5, supra. In construing the wage-payments exclusion, this Court had held that the Act *377 did not cover the actions of union truckdrivers who exacted money by threats or violence from out-of-town drivers in return for undesired and often unutilized services. United States v. Teamsters, 315 U.S. 521 (1942). Shortly thereafter, several bills were introduced in Congress to alter this result. United States v. Enmons, supra, at 402, and n.8.
The bill that eventually became the Hobbs Act deleted the exception on which the Court had relied in Teamsters and substituted specific prohibitions against robbery and extortion for the Anti-Racketeering Act's language relating to the use of force or threats of force. The primary focus in the Hobbs Act debates was on whether the bill was designed as an attack on organized labor. Opponents of the bill argued that it would be used to prosecute strikers and interfere with labor unions. See, e. g., 91 Cong. Rec. 11848 (1945) (remarks of Rep. Lane); ibid. (remarks of Rep. Powell); id., at 11902 (remarks of Rep. Celler). The proponents of the bill steadfastly maintained that the purpose of the bill was to prohibit robbery and extortion perpetrated by anyone. See, e. g., id., at 11900 (remarks of Rep. Hancock); id., at 11904 (remarks of Rep. Gwynne); id., at 11912 (remarks of Rep. Hobbs); id., at 11914 (remarks of Rep. Russell). Although there were many references in the debates to "racketeers" and "racketeering," see, e. g., id., at 11906 (remarks of Rep. Robsion); id., at 11908 (remarks of Rep. Vursell); id., at 11910 (remarks of Rep. Andersen), none of the comments supports the conclusion that Congress did not intend to make punishable all conduct falling within the reach of the statutory language. To the contrary, the debates are fully consistent with the statement in the Report of the House Committee on the Judiciary that the purpose of the bill was "to prevent anyone from obstructing, delaying, or affecting commerce, or the movement of any article or commodity in commerce by robbery or extortion as defined in the bill." H. R. Rep. No. 238, 79th Cong., 1st Sess., 9 (1945) (emphasis *378 added); see also S. Rep. No. 1516, 79th Cong., 2d Sess., 1 (1946).[8]
Indeed, many Congressmen praised the bill because it set out with more precision the conduct that was being made criminal. As Representative Hobbs noted, the words robbery and extortion "have been construed a thousand times by the courts. Everybody knows what they mean." 91 Cong. Rec. 11912 (1945). See also id., at 11906 (remarks of Rep. Robsion); id., at 11910 (remarks of Rep. Springer); id., at 11914 (remarks of Rep. Russell). In the wake of the Court's decision in Teamsters, moreover, a paramount congressional concern was to be clear about what conduct was prohibited:
"We are explicit. That language is too general, and we thought it better to make this bill explicit, and leave nothing to the imagination of the court." 91 Cong. Rec. 11904 (1945) (remarks of Rep. Hancock).
See id., at 11912 (remarks of Rep. Hobbs).
It is inconceivable that, at the same time Congress was so concerned about clearly defining the acts prohibited under the bill, it intended to make proof of racketeeringa term not mentioned in the statutea separate prerequisite to criminal liability under the Hobbs Act.[9]
*379 III
We therefore conclude that respondent's position has no support in either the statute or its legislative history. Respondent also invokes, as did the court below, two maxims of statutory construction, but neither is applicable here. It is true that "ambiguity concerning the ambit of criminal statutes should be resolved in favor of lenity," Rewis v. United States, 401 U.S. 808, 812 (1971), and that, "unless Congress conveys its purpose clearly, it will not be deemed to have significantly changed the federal-state balance," United States v. Bass, 404 U.S. 336, 349 (1971). But here Congress has conveyed its purpose clearly, and we decline to manufacture ambiguity where none exists. The two maxims only apply "when we are uncertain about the statute's meaning"; they are "not to be used `in complete disregard of the purpose of the legislature.'" Scarborough v. United States, 431 U.S. 563, 577 (1977), quoting United States v. Bramblett, 348 U.S. 503, 510 (1955).
With regard to the concern about disturbing the federal-state balance, moreover, there is no question that Congress intended to define as a federal crime conduct that it knew was punishable under state law. The legislative debates are replete with statements that the conduct punishable under the Hobbs Act was already punishable under state robbery and extortion statutes. See, e. g., 91 Cong. Rec. 11848 (1945) (remarks of Rep. Powell); id., at 11900 (remarks of Rep. Hancock); id., at 11904 (remarks of Rep. Gwynne). Those who opposed the Act argued that it was a grave interference with the rights of the States. See, e. g., id., at 11903 (remarks *380 of Rep. Welch); id., at 11913 (remarks of Rep. Resa). Congress apparently believed, however, that the States had not been effectively prosecuting robbery and extortion affecting interstate commerce and that the Federal Government had an obligation to do so. See, e. g., id., at 11911 (remarks of Rep. Jennings); id., at 11904, 11920 (remarks of Rep. Gwynne).
Our examination of the statutory language and the legislative history of the Hobbs Act impels us to the conclusion that Congress intended to make criminal all conduct within the reach of the statutory language. We therefore decline the invitation to limit the statute's scope by reference to an undefined category of conduct termed "racketeering." The judgment of the Court of Appeals is, accordingly,
Reversed.
MR. JUSTICE BRENNAN took no part in the consideration or decision of this case.
| Respondent was convicted of violating the Hobbs Act, 18 U.S. C. 191 ( ed.), which provides in relevant part: "Whoever in any way or degree obstructs, delays, or affects commerce or the movement of any article or commodity in commerce, by robbery or extortion or attempts or conspires so to do, or commits or threatens physical *372 violence to any person or property in furtherance of a plan or purpose to do anything in violation of this section shall be fined not more than $10,000 or imprisoned not more than twenty years, or both." 191 (a). The question in this case is whether the government not only had to establish that respondent violated the express terms of the Act, but also had to prove that his conduct constituted "racketeering." The evidence at respondent's jury trial showed that he and an accomplice attempted to obtain $100,000 from a federally insured bank by means of threats of physical violence made to the bank's president. The United States Court of Appeals for the Ninth Circuit, with one judge dissenting, reversed the Hobbs Act conviction,[1] holding that, "`although an activity may be within the literal language of the Hobbs Act, it must constitute "racketeering" to be within the perimeters of the Act.'" We granted certiorari,[2] and we now reverse. *373 I Nothing on the face of the statute suggests a congressional intent to limit its coverage to persons who have engaged in "racketeering." To the contrary, the statutory language sweeps within it all persons who have "in any way or degree affect[ed] commerce by robbery or extortion." 18 U.S. C. 191 (a) ( ed.). These words do not lend themselves to restrictive interpretation; as we have recognized, they "manifest a purpose to use all the constitutional power Congress has to punish interference with interstate commerce by extortion, robbery or physical violence," The statute, moreover, carefully defines its key terms, such as "robbery," "extortion," and "commerce."[3] Hence the absence of any reference to "racketeering"much less any definition of the wordis strong evidence that Congress did not intend to make "racketeering" an element of a Hobbs Act violation. *374 Respondent nevertheless argues that we should read a racketeering requirement into the statute. To do so, however, might create serious constitutional problems, in view of the absence of any definition of racketeering in the statute. Neither respondent nor either of the two Courts of Appeals that have read this requirement into the statute has even attempted to provide a definition. Without such a definition, the statute might well violate "the first essential of due process of law": It would forbid "the doing of an act in terms so vague that [persons] of common intelligence [would] necessarily [have to] guess at its meaning and differ as to its application." ; see, e. g., But we need not concern ourselves with these potential constitutional difficulties because a construction that avoids them is virtually compelled by the language and structure of the statute. II A Nothing in the legislative history supports the interpretation of the statute adopted by the Court of Appeals.[4] The predecessor to the Hobbs Act, the Anti-Racketeering Act of 1934, ch. 69, was enacted, as its name implies, at a time when Congress was very concerned about racketeering activities. Despite these concerns, however, the Act, which was written in broad language similar to the language of the *37 Hobbs Act, nowhere mentioned racketeering.[] This absence of the term is not surprising, since the principal congressional committee working on the Act, known as the Copeland Committee, found that the term and the associated word "racket" had "for some time been used loosely to designate every conceivable sort of practice or activity which was either questionable, unmoral, fraudulent, or even disliked, whether criminal or not." S. Rep. No. 1189, 7th Cong., 1st Sess., 2 (1937).[6] The Copeland Committee proceeded to develop its own "working definition" of racketeering, but it did not incorporate *376 this definition into the Act. Critical to the definition was the existence of "an organized conspiracy to commit the crimes of extortion or coercion." Yet the Act itself did not require a conspiracy to engage in unlawful conduct, and the Senate Judiciary Committee Report expressly stated that a violation of the Act would be established "`whether the restraints [of commerce] are in form of conspiracies or not,'" S. Rep. No. 32, 73d Cong., 2d Sess., 2 (1934), quoting Justice Department memorandum; see H. R. Rep. No. 1833, 73d Cong., 2d Sess., 2 (1934). Moreover, the Act included a separate prohibition on conspiracies, 2 (d), ; see n. that would have been superfluous if proof of racketeeringas defined by the Copeland Committee to require conspiracywere an integral element of the substantive offenses.[7] There is nothing in the legislative history to dispel the conclusion compelled by these observations. Congress simply did not intend to make racketeering a separate, unstated element of an Anti-Racketeering Act violation. B Given the absence of this intent in the Hobbs Act's predecessor, any requirement that racketeering be proved must be derived from the Hobbs Act itself or its legislative history. While the Hobbs Act was enacted to correct a perceived deficiency in the Anti-Racketeering Act, that deficiency had nothing to do with the element of racketeering. See United Rather, it involved the latter Act's requirement that the proscribed "force, violence or coercion" lead to exaction of "valuable consideration" and its exclusion of wage payments from the definition of consideration. See n. In construing the wage-payments exclusion, this Court had held that the Act *377 did not cover the actions of union truckdrivers who exacted money by threats or violence from out-of-town drivers in return for undesired and often unutilized services. United 31 U.S. 21 Shortly thereafter, several bills were introduced in Congress to alter this result. United and n.8. The bill that eventually became the Hobbs Act deleted the exception on which the Court had relied in Teamsters and substituted specific prohibitions against robbery and extortion for the Anti-Racketeering Act's language relating to the use of force or threats of force. The primary focus in the Hobbs Act debates was on whether the bill was designed as an attack on organized labor. Opponents of the bill argued that it would be used to prosecute strikers and interfere with labor unions. See, e. g., 91 Cong. Rec. 11848 (194) (remarks of Rep. Lane); ; The proponents of the bill steadfastly maintained that the purpose of the bill was to prohibit robbery and extortion perpetrated by anyone. See, e. g., ; ; ; Although there were many references in the debates to "racketeers" and "racketeering," see, e. g., ; ; none of the comments supports the conclusion that Congress did not intend to make punishable all conduct falling within the reach of the statutory language. To the contrary, the debates are fully consistent with the statement in the Report of the House Committee on the Judiciary that the purpose of the bill was "to prevent anyone from obstructing, delaying, or affecting commerce, or the movement of any article or commodity in commerce by robbery or extortion as defined in the bill." H. R. Rep. No. 238, 79th Cong., 1st Sess., 9 (194) (emphasis *378 added); see also S. Rep. No. 116, 79th Cong., 2d Sess., 1 (1946).[8] Indeed, many Congressmen praised the bill because it set out with more precision the conduct that was being made criminal. As Representative Hobbs noted, the words robbery and extortion "have been construed a thousand times by the courts. Everybody knows what they mean." 91 Cong. Rec. 11912 (194). See also ; ; In the wake of the Court's decision in Teamsters, moreover, a paramount congressional concern was to be clear about what conduct was prohibited: "We are explicit. That language is too general, and we thought it better to make this bill explicit, and leave nothing to the imagination of the court." 91 Cong. Rec. 11904 (194) See It is inconceivable that, at the same time Congress was so concerned about clearly defining the acts prohibited under the bill, it intended to make proof of racketeeringa term not mentioned in the statutea separate prerequisite to criminal liability under the Hobbs Act.[9] *379 III We therefore conclude that respondent's position has no support in either the statute or its legislative history. Respondent also invokes, as did the court below, two maxims of statutory construction, but neither is applicable here. It is true that "ambiguity concerning the ambit of criminal statutes should be resolved in favor of lenity," and that, "unless Congress conveys its purpose clearly, it will not be deemed to have significantly changed the federal-state balance," United But here Congress has conveyed its purpose clearly, and we decline to manufacture ambiguity where none exists. The two maxims only apply "when we are uncertain about the statute's meaning"; they are "not to be used `in complete disregard of the purpose of the legislature.'" 431 U.S. 63, 77 quoting United 348 U.S. 03, 10 (19). With regard to the concern about disturbing the federal-state balance, moreover, there is no question that Congress intended to define as a federal crime conduct that it knew was punishable under state law. The legislative debates are replete with statements that the conduct punishable under the Hobbs Act was already punishable under state robbery and extortion statutes. See, e. g., 91 Cong. Rec. 11848 (194) ; ; Those who opposed the Act argued that it was a grave interference with the rights of the States. See, e. g., ; Congress apparently believed, however, that the States had not been effectively prosecuting robbery and extortion affecting interstate commerce and that the Federal Government had an obligation to do so. See, e. g., ; 11920 Our examination of the statutory language and the legislative history of the Hobbs Act impels us to the conclusion that Congress intended to make criminal all conduct within the reach of the statutory language. We therefore decline the invitation to limit the statute's scope by reference to an undefined category of conduct termed "racketeering." The judgment of the Court of Appeals is, accordingly, Reversed. MR. JUSTICE BRENNAN took no part in the consideration or decision of this case. |
Justice Powell | majority | false | United States v. Byrum | 1972-10-10T00:00:00 | null | https://www.courtlistener.com/opinion/108599/united-states-v-byrum/ | https://www.courtlistener.com/api/rest/v3/clusters/108599/ | 1,972 | 1971-164 | 1 | 6 | 3 | Decedent, Milliken C. Byrum, created in 1958 an irrevocable trust to which he transferred shares of stock in three closely held corporations. Prior to transfer, he owned at least 71% of the outstanding stock of each corporation. The beneficiaries were his children or, in the event of their death before the termination of the trust, their surviving children. The trust instrument specified that there be a corporate trustee. Byrum designated as sole trustee an independent corporation, Huntington National Bank. The trust agreement vested *127 in the trustee broad and detailed powers with respect to the control and management of the trust property. These powers were exercisable in the trustee's sole discretion, subject to certain rights reserved by Byrum: (i) to vote the shares of unlisted stock held in the trust estate; (ii) to disapprove the sale or transfer of any trust assets, including the shares transferred to the trust; (iii) to approve investments and reinvestments; and (iv) to remove the trustee and "designate another corporate Trustee to serve as successor." Until the youngest living child reached age 21, the trustee was authorized in its "absolute and sole discretion" to pay the income and principal of the trust to or for the benefit of the beneficiaries, "with due regard to their individual needs for education, care, maintenance and support." After the youngest child reached 21, the trust was to be divided into a separate trust for each child, to terminate when the beneficiaries reached 35. The trustee was authorized in its discretion to pay income and principal from these trusts to the beneficiaries for emergency or other "worthy need," including education.[1]
*128 When he died in 1964, Byrum owned less than 50% of the common stock in two of the corporations and 59% in the third. The trust had retained the shares *129 transferred to it, with the result that Byrum had continued to have the right to vote not less than 71% of the common stock in each of the three corporations.[2]*130 There were minority stockholders, unrelated to Byrum, in each corporation.
Following Byrum's death, the Commissioner of Internal Revenue determined that the transferred stock was properly included within Byrum's gross estate under § 2036 (a) of the Internal Revenue Code of 1954, 26 U.S. C. § 2036 (a). That section provides for the inclusion in a decedent's gross estate of all property which the decedent has transferred by inter vivos transaction, if he has retained for his lifetime "(1) the possession or enjoyment of, or the right to the income from, the property" transferred, or "(2) the right, either alone or in conjunction with any person, to designate the persons who shall possess or enjoy the property or the income *131 therefrom."[3] The Commissioner determined that the stock transferred into the trust should be included in Byrum's gross estate because of the rights reserved by him in the trust agreement. It was asserted that his right to vote the transferred shares and to veto any sale thereof by the trustee, together with the ownership of other shares, enabled Byrum to retain the "enjoyment of . . . the property," and also allowed him to determine the flow of income to the trust and thereby "designate the persons who shall . . . enjoy . . . the income."
The executrix of Byrum's estate paid an additional tax of $13,202.45, and thereafter brought this refund action in District Court. The facts not being in dispute, the court ruled for the executrix on cross motions for summary judgment. 311 F. Supp. 892 (SD Ohio 1970). The Court of Appeals affirmed, one judge dissenting. 440 F.2d 949 (CA6 1971). We granted the Government's petition for certiorari. 404 U.S. 937 (1971).
I
The Government relies primarily on its claim, made under § 2036 (a) (2), that Byrum retained the right to *132 designate the persons who shall enjoy the income from the transferred property. The argument is a complicated one. By retaining voting control over the corporations whose stock was transferred, Byrum was in a position to select the corporate directors. He could retain this position by not selling the shares he owned and by vetoing any sale by the trustee of the transferred shares. These rights, it is said, gave him control over corporate dividend policy. By increasing, decreasing, or stopping dividends completely, it is argued that Byrum could "regulate the flow of income to the trust" and thereby shift or defer the beneficial enjoyment of trust income between the present beneficiaries and the remaindermen. The sum of this retained power is said to be tantamount to a grantor-trustee's power to accumulate income in the trust, which this Court has recognized constitutes the power to designate the persons who shall enjoy the income from transferred property.[4]
At the outset we observe that this Court has never held that trust property must be included in a settlor's gross estate solely because the settlor retained the power *133 to manage trust assets. On the contrary, since our decision in Reinecke v. Northern Trust Co., 278 U.S. 339 (1929), it has been recognized that a settlor's retention of broad powers of management does not necessarily subject an inter vivos trust to the federal estate tax.[5] Although there was no statutory analogue to § 2036 (a) (2) when Northern Trust was decided, several lower court decisions decided after the enactment of the predecessor of § 2036 (a) (2) have upheld the settlor's right to exercise managerial powers without incurring estate-tax liability.[6] In Estate of King v. Commissioner, 37 T.C. 973 (1962), a settlor reserved the power to direct the trustee in the management and investment of trust assets. The Government argued that the settlor was thereby empowered to cause investments to be made in such a manner as to control significantly the flow of income into the trust. The Tax Court rejected this argument, and held for the taxpayer. Although the court recognized that the settlor had reserved "wide latitude in the exercise of his discretion as to the types of investments to be made," id., at 980, it did not find this control over the flow of income to be equivalent *134 to the power to designate who shall enjoy the income from the transferred property.
Essentially the power retained by Byrum is the same managerial power retained by the settlors in Northern Trust and in King. Although neither case controls this oneNorthern Trust, because it was not decided under § 2036 (a) (2) or a predecessor; and King, because it is a lower court opinionthe existence of such precedents carries weight.[7] The holding of Northern Trust, that the settlor of a trust may retain broad powers of management without adverse estate-tax consequences, may have been relied upon in the drafting of hundreds of inter vivos trusts.[8] The modification of this principle now sought by the Government could have a seriously adverse impact, especially upon settlors (and their estates) who happen to have been "controlling" stock-holders *135 of a closely held corporation. Courts properly have been reluctant to depart from an interpretation of tax law which has been generally accepted when the departure could have potentially far-reaching consequences. When a principle of taxation requires re-examination, Congress is better equipped than a court to define precisely the type of conduct which results in tax consequences. When courts readily undertake such tasks, taxpayers may not rely with assurance on what appear to be established rules lest they be subsequently overturned. Legislative enactments, on the other hand, although not always free from ambiguity, at least afford the taxpayers advance warning.
The Government argues, however, that our opinion in United States v. O'Malley, 383 U.S. 627 (1966), compels the inclusion in Byrum's estate of the stock owned by the trust. In O'Malley, the settlor of an inter vivos trust named himself as one of the three trustees. The trust agreement authorized the trustees to pay income to the life beneficiary or to accumulate it as a part of the principal of the trust in their "sole discretion." The agreement further provided that net income retained by the trustees, and not distributed in any calendar year, " `shall become a part of the principal of the Trust Estate.' " Id., at 629 n. 2. The Court characterized the effect of the trust as follows:
"Here Fabrice [the settlor] was empowered, with the other trustees, to distribute the trust income to the income beneficiaries or to accumulate it and add it to the principal, thereby denying to the beneficiaries the privilege of immediate enjoyment and conditioning their eventual enjoyment upon surviving the termination of the trust." Id., at 631.
As the retention of this legal right by the settlor, acting as a trustee "in conjunction" with the other trustees, *136 came squarely within the language and intent of the predecessor of § 2036 (a) (2), the taxpayer conceded that the original assets transferred into the trust were includable in the decedent's gross estate. Id., at 632. The issue before the Court was whether the accumulated income, which had been added to the principal pursuant to the reservation of right in that respect, was also includable in decedent's estate for tax purposes. The Court held that it was.
In our view, and for the purposes of this case, O'Malley adds nothing to the statute itself. The facts in that case were clearly within the ambit of what is now § 2036 (a). That section requires that the settlor must have "retained for his life . . . (2) the right . . . to designate the persons who shall possess or enjoy the property or the income therefrom." O'Malley was covered precisely by the statute for two reasons: (1) there the settlor had reserved a legal right, set forth in the trust instrument; and (2) this right expressly authorized the settlor, "in conjunction" with others, to accumulate income and thereby "to designate" the persons to enjoy it.
It must be conceded that Byrum reserved no such "right" in the trust instrument or otherwise. The term "right," certainly when used in a tax statute, must be given its normal and customary meaning. It connotes an ascertainable and legally enforceable power, such as that involved in O'Malley.[9] Here, the right ascribed to Byrum was the power to use his majority position and influence over the corporate directors to "regulate the flow of dividends" to the trust. That "right" was *137 neither ascertainable nor legally enforceable and hence was not a right in any normal sense of that term.[10]
Byrum did retain the legal right to vote shares held by the trust and to veto investments and reinvestments. But the corporate trustee alone, not Byrum, had the right to pay out or withhold income and thereby to designate who among the beneficiaries enjoyed such income. Whatever power Byrum may have possessed with respect to the flow of income into the trust was derived not from an enforceable legal right specified in the trust instrument, but from the fact that he could elect a majority of the directors of the three corporations. The power to elect the directors conferred no legal right to command them to pay or not to pay dividends. A majority shareholder has a fiduciary duty not to misuse his power by promoting his personal interests at the expense of corporate interests.[11] Moreover, *138 the directors also have a fiduciary duty to promote the interests of the corporation.[12] However great Byrum's influence may have been with the corporate directors, their responsibilities were to all stockholders and were enforceable according to legal standards entirely unrelated to the needs of the trust or to Byrum's desires with respect thereto.
The Government seeks to equate the de facto position of a controlling stockholder with the legally enforceable "right" specified by the statute. Retention of corporate control (through the right to vote the shares) is said to be "tantamount to the power to accumulate income" in the trust which resulted in estate-tax consequences in O'Malley. The Government goes on to assert that "[t]hrough exercise of that retained power, [Byrum] could increase or decrease corporate dividends. . . and thereby shift or defer the beneficial enjoyment of trust income."[13] This approach seems to us *139 not only to depart from the specific statutory language,[14] but also to misconceive the realities of corporate life.
There is no reason to suppose that the three corporations controlled by Byrum were other than typical small businesses. The customary vicissitudes of such enterprises bad years; product obsolescence; new competition; disastrous litigation; new, inhibiting Government regulations; even bankruptcyprevent any certainty or predictability as to earnings or dividends. There is no assurance that a small corporation will have a flow of net earnings or that income earned will in fact be available for dividends. Thus, Byrum's alleged de facto "power to *140 control the flow of dividends" to the trust was subject to business and economic variables over which he had little or no control.
Even where there are corporate earnings, the legal power to declare dividends is vested solely in the corporate board. In making decisions with respect to dividends, the board must consider a number of factors. It must balance the expectation of stockholders to reasonable dividends when earned against corporate needs for retention of earnings. The first responsibility of the board is to safeguard corporate financial viability for the long term. This means, among other things, the retention of sufficient earnings to assure adequate working capital as well as resources for retirement of debt, for replacement and modernization of plant and equipment, and for growth and expansion. The nature of a corporation's business, as well as the policies and long-range plans of management, are also relevant to dividend payment decisions.[15] Directors of a closely held, small corporation must bear in mind the relatively limited access of such an enterprise to capital markets. This may require a more conservative policy with respect to dividends than would be expected of an established corporation with securities listed on national exchanges.[16]
*141 Nor do small corporations have the flexibility or the opportunity available to national concerns in the utilization of retained earnings. When earnings are substantial, a decision not to pay dividends may result only in the accumulation of surplus rather than growth through internal or external expansion. The accumulated earnings may result in the imposition of a penalty tax.[17]
These various economic considerations are ignored at the directors' peril. Although vested with broad discretion in determining whether, when, and what amount of dividends shall be paid, that discretion is subject to legal restraints. If, in obedience to the will of the majority stockholder, corporate directors disregard the interests of shareholders by accumulating earnings to an unreasonable extent, they are vulnerable to a derivative suit.[18] They are similarly vulnerable if they make an unlawful payment of dividends in the absence of net earnings or available surplus,[19] or if they fail to exercise *142 the requisite degree of care in discharging their duty to act only in the best interest of the corporation and its stockholders.
Byrum was similarly inhibited by a fiduciary duty from abusing his position as majority shareholder for personal or family advantage to the detriment of the corporation or other stockholders. There were a substantial number of minority stockholders in these corporations who were unrelated to Byrum.[20] Had Byrum and the directors violated their duties, the minority shareholders would have had a cause of action under Ohio law.[21] The Huntington National Bank, as trustee, was one of the minority stockholders, and it had both the right and the duty to hold Byrum responsible for any wrongful or negligent action as a controlling stockholder or as a director of the corporations.[22] Although Byrum had reserved the right to remove the trustee, he would have been imprudent to do this when confronted by the *143 trustee's complaint against his conduct. A successor trustee would succeed to the rights of the one removed.
We conclude that Byrum did not have an unconstrained de facto power to regulate the flow of dividends to the trust, much less the "right" to designate who was to enjoy the income from trust property. His ability to affect, but not control, trust income, was a qualitatively different power from that of the settlor in O'Malley, who had a specific and enforceable right to control the income paid to the beneficiaries.[23] Even had Byrum managed to flood the trust with income, he had no way of compelling the trustee to pay it out rather than accumulate it. Nor could he prevent the trustee from making payments from other trust assets,[24] although admittedly there were few of these at the time of Byrum's death. We cannot assume, however, that no other assets would come into the trust from reinvestments or other gifts.[25]
*144 We find no merit to the Government's contention that Byrum's de facto "control," subject as it was to the economic and legal constraints set forth above, was tantamount to the right to designate the persons who shall enjoy trust income, specified by § 2036 (a) (2).[26]
*145 II
The Government asserts an alternative ground for including the shares transferred to the trust within Byrum's gross estate. It argues that by retaining control, Byrum guaranteed himself continued employment and remuneration, as well as the right to determine whether and when the corporations would be liquidated or merged. Byrum is thus said to have retained "the . . . enjoyment of . . . the property" making it includable within his gross estate under § 2036 (a) (1). The Government concedes that the retention of the voting rights of an "unimportant minority interest" would not require inclusion of the transferred shares under § 2036 (a) (1). It argues, however, "where the cumulative effect of the retained powers and the rights flowing from the shares not placed in trust leaves the grantor in control of a close corporation, and assures that control for his lifetime, he has retained the `enjoyment' of the transferred stock."[27] Brief for United States 23.
It is well settled that the terms "enjoy" and "enjoyment," as used in various estate tax statutes, "are not terms of art, but connote substantial present economic benefit rather than technical vesting of title or estates." Commissioner v. Estate of Holmes, 326 U.S. 480, 486 *146 (1946).[28] For example, in Reinecke v. Northern Trust Co., 278 U.S. 339 (1929), in which the critical inquiry was whether the decedent had created a trust "intended. . . `to take effect in possession or enjoyment at or after his death,' "[29]id., at 348, the Court held that reserved powers of management of trust assets, similar to Byrum's power over the three corporations, did not subject an inter vivos trust to the federal estate tax. In determining whether the settlor had retained the enjoyment of the transferred property, the Court said:
"Nor did the reserved powers of management of the trusts save to decedent any control over the economic benefits or the enjoyment of the property. He would equally have reserved all these powers and others had he made himself the trustee, but the transfer would not for that reason have been incomplete. The shifting of the economic interest in the trust property which was the subject of the tax was thus complete as soon as the trust was made. His power to recall the property and of control over it for his own benefit then ceased and as the trusts were not made in contemplation *147 of death, the reserved powers do not serve to distinguish them from any other gift inter vivos not subject to the tax." 278 U.S., at 346-347.
The cases cited by the Government reveal that the terms "possession" and "enjoyment," used in § 2036 (a) (1), were used to deal with situations in which the owner of property divested himself of title but retained an income interest or, in the case of real property, the lifetime use of the property. Mr. Justice Black's opinion for the Court in Commissioner v. Estate of Church, 335 U.S. 632 (1949), traces the history of the concept. In none of the cases cited by the Government has a court held that a person has retained possession or enjoyment of the property if he has transferred title irrevocably, made complete delivery of the property and relinquished the right to income where the property is income producing.[30]
The Government cites only one case, Estate of Holland v. Commissioner, 1 T.C. 564 (1943),[31] in which a decedent had retained the right to vote transferred shares of stock and in which the stock was included *148 within the decedent's gross estate. In that case, it was not the mere power to vote the stock, giving the decedent control of the corporation, which caused the Tax Court to include the shares. The court held that " `on an inclusive view of the whole arrangement, this withholding of the income until decedent's death, coupled with the retention of the certificates under the pledge and the reservation of the right to vote the stock and to designate the company officers' " subjects the stock to inclusion within the gross estate. Id., at 565. The settlor in Holland retained a considerably greater interest than Byrum retained, including an income interest.[32]
As the Government concedes, the mere retention of the right-to-vote shares does not constitute the type of "enjoyment" in the property itself contemplated by § 2036 (a) (1). In addition to being against the weight of precedent, the Government's argument that Byrum retained "enjoyment" within the meaning of § 2036 (a) (1) is conceptually unsound. This argument implies, as it must under the express language of § 2036 (a), that Byrum "retained for his life . . . (1) the possession or enjoyment" of the "property" transferred to the trust or the "income" therefrom. The only property he transferred was corporate stock. He did not transfer "control" (in the sense used by the Government) as the trust never owned as much as 50% of the stock of any corporation. Byrum never divested himself of control, as he was able to vote a majority of the shares by virtue of what he owned and the right to vote those placed in *149 the trust. Indeed, at the time of his death he still owned a majority of the shares in the largest of the corporations and probably would have exercised control of the other two by virtue of being a large stockholder in each.[33] The statutory language plainly contemplates retention of an attribute of the property transferredsuch as a right to income, use of the property itself, or a power of appointment with respect either to income or principal.[34]
Even if Byrum had transferred a majority of the stock, but had retained voting control, he would not have retained "substantial present economic benefit," 326 U.S., at 486. The Government points to the retention of two "benefits." The first of these, the power to liquidate or *150 merge, is not a present benefit; rather, it is a speculative and contingent benefit which may or may not be realized. Nor is the probability of continued employment and compensation the substantial "enjoyment of . . . [the transferred] property" within the meaning of the statute. The dominant stockholder in a closely held corporation, if he is active and productive, is likely to hold a senior position and to enjoy the advantage of a significant voice in his own compensation. These are inevitable facts of the free-enterprise system, but the influence and capability of a controlling stockholder to favor himself are not without constraints. Where there are minority stockholders, as in this case, directors may be held accountable if their employment, compensation, and retention of officers violate their duty to act reasonably in the best interest of the corporation and all of its stockholders.[35] Moreover, this duty is policed, albeit indirectly, by the Internal Revenue Service, which disallows the deduction of unreasonable compensation paid to a corporate executive as a business expense.[36] We conclude that Byrum's retention of voting control was not the retention of the enjoyment of the transferred property within the meaning of the statute.
*151 For the reasons set forth above, we hold that this case was correctly decided by the Court of Appeals and accordingly the judgment is
Affirmed.
MR. JUSTICE WHITE, with whom MR. JUSTICE BRENNAN and MR. | Decedent, Milliken C. Byrum, created in 1958 an irrevocable trust to which he transferred shares of stock in three closely held corporations. Prior to transfer, he owned at least 71% of the outstanding stock of each corporation. The beneficiaries were his children or, in the event of their death before the termination of the trust, their surviving children. The trust instrument specified that there be a corporate trustee. Byrum designated as sole trustee an independent corporation, Huntington National Bank. The trust agreement vested *127 in the trustee broad and detailed powers with respect to the control and management of the trust property. These powers were exercisable in the trustee's sole discretion, subject to certain rights reserved by Byrum: (i) to vote the shares of unlisted stock held in the trust estate; (ii) to disapprove the sale or transfer of any trust assets, including the shares transferred to the trust; (iii) to approve investments and reinvestments; and (iv) to remove the trustee and "designate another corporate Trustee to serve as successor." Until the youngest living child reached age 21, the trustee was authorized in its "absolute and sole discretion" to pay the income and principal of the trust to or for the benefit of the beneficiaries, "with due regard to their individual needs for education, care, maintenance and support." After the youngest child reached 21, the trust was to be divided into a separate trust for each child, to terminate when the beneficiaries reached 35. The trustee was authorized in its discretion to pay income and principal from these trusts to the beneficiaries for emergency or other "worthy need," including education.[1] *128 When he died in 1964, Byrum owned less than 50% of the common stock in two of the corporations and 59% in the third. The trust had retained the shares *129 transferred to it, with the result that Byrum had continued to have the right to vote not less than 71% of the common stock in each of the three corporations.[2]*130 There were minority stockholders, unrelated to Byrum, in each corporation. Following Byrum's death, the Commissioner of Internal Revenue determined that the transferred stock was properly included within Byrum's gross estate under 2036 (a) of the Internal Revenue Code of 1954, 26 U.S. C. 2036 (a). That section provides for the inclusion in a decedent's gross estate of all property which the decedent has transferred by inter vivos transaction, if he has retained for his lifetime "(1) the possession or enjoyment of, or the right to the income from, the property" transferred, or "(2) the right, either alone or in conjunction with any person, to designate the persons who shall possess or enjoy the property or the income *131 therefrom."[3] The Commissioner determined that the stock transferred into the trust should be included in Byrum's gross estate because of the rights reserved by him in the trust agreement. It was asserted that his right to vote the transferred shares and to veto any sale thereof by the trustee, together with the ownership of other shares, enabled Byrum to retain the "enjoyment of the property," and also allowed him to determine the flow of income to the trust and thereby "designate the persons who shall enjoy the income." The executrix of Byrum's estate paid an additional tax of $13,202.45, and thereafter brought this refund action in District Court. The facts not being in dispute, the court ruled for the executrix on cross motions for summary judgment. The Court of Appeals affirmed, one judge dissenting. We granted the Government's petition for certiorari. I The Government relies primarily on its claim, made under 2036 (a) (2), that Byrum retained the right to *132 designate the persons who shall enjoy the income from the transferred property. The argument is a complicated one. By retaining voting control over the corporations whose stock was transferred, Byrum was in a position to select the corporate directors. He could retain this position by not selling the shares he owned and by vetoing any sale by the trustee of the transferred shares. These rights, it is said, gave him control over corporate dividend policy. By increasing, decreasing, or stopping dividends completely, it is argued that Byrum could "regulate the flow of income to the trust" and thereby shift or defer the beneficial enjoyment of trust income between the present beneficiaries and the remaindermen. The sum of this retained power is said to be tantamount to a grantor-trustee's power to accumulate income in the trust, which this Court has recognized constitutes the power to designate the persons who shall enjoy the income from transferred property.[4] At the outset we observe that this Court has never held that trust property must be included in a settlor's gross estate solely because the settlor retained the power *133 to manage trust assets. On the contrary, since our decision in it has been recognized that a settlor's retention of broad powers of management does not necessarily subject an inter vivos trust to the federal estate tax.[5] Although there was no statutory analogue to 2036 (a) (2) when Northern Trust was decided, several lower court decisions decided after the enactment of the predecessor of 2036 (a) (2) have upheld the settlor's right to exercise managerial powers without incurring estate-tax liability.[6] In Estate of a settlor reserved the power to direct the trustee in the management and investment of trust assets. The Government argued that the settlor was thereby empowered to cause investments to be made in such a manner as to control significantly the flow of income into the trust. The Tax Court rejected this argument, and held for the taxpayer. Although the court recognized that the settlor had reserved "wide latitude in the exercise of his discretion as to the types of investments to be made," it did not find this control over the flow of income to be equivalent *134 to the power to designate who shall enjoy the income from the transferred property. Essentially the power retained by Byrum is the same managerial power retained by the settlors in Northern Trust and in King. Although neither case controls this oneNorthern Trust, because it was not decided under 2036 (a) (2) or a predecessor; and King, because it is a lower court opinionthe existence of such precedents carries weight.[7] The holding of Northern Trust, that the settlor of a trust may retain broad powers of management without adverse estate-tax consequences, may have been relied upon in the drafting of hundreds of inter vivos trusts.[8] The modification of this principle now sought by the Government could have a seriously adverse impact, especially upon settlors (and their estates) who happen to have been "controlling" stock-holders *135 of a closely held corporation. Courts properly have been reluctant to depart from an interpretation of tax law which has been generally accepted when the departure could have potentially far-reaching consequences. When a principle of taxation requires re-examination, Congress is better equipped than a court to define precisely the type of conduct which results in tax consequences. When courts readily undertake such tasks, taxpayers may not rely with assurance on what appear to be established rules lest they be subsequently overturned. Legislative enactments, on the other hand, although not always free from ambiguity, at least afford the taxpayers advance warning. The Government argues, however, that our opinion in United compels the inclusion in Byrum's estate of the stock owned by the trust. In O'Malley, the settlor of an inter vivos trust named himself as one of the three trustees. The trust agreement authorized the trustees to pay income to the life beneficiary or to accumulate it as a part of the principal of the trust in their "sole discretion." The agreement further provided that net income retained by the trustees, and not distributed in any calendar year, " `shall become a part of the principal of the Trust Estate.' " at 629 n. 2. The Court characterized the effect of the trust as follows: "Here Fabrice [the settlor] was empowered, with the other trustees, to distribute the trust income to the income beneficiaries or to accumulate it and add it to the principal, thereby denying to the beneficiaries the privilege of immediate enjoyment and conditioning their eventual enjoyment upon surviving the termination of the trust." As the retention of this legal right by the settlor, acting as a trustee "in conjunction" with the other trustees, *136 came squarely within the language and intent of the predecessor of 2036 (a) (2), the taxpayer conceded that the original assets transferred into the trust were includable in the decedent's gross estate. The issue before the Court was whether the accumulated income, which had been added to the principal pursuant to the reservation of right in that respect, was also includable in decedent's estate for tax purposes. The Court held that it was. In our view, and for the purposes of this case, O'Malley adds nothing to the statute itself. The facts in that case were clearly within the ambit of what is now 2036 (a). That section requires that the settlor must have "retained for his life (2) the right to designate the persons who shall possess or enjoy the property or the income therefrom." O'Malley was covered precisely by the statute for two reasons: (1) there the settlor had reserved a legal right, set forth in the trust instrument; and (2) this right expressly authorized the settlor, "in conjunction" with others, to accumulate income and thereby "to designate" the persons to enjoy it. It must be conceded that Byrum reserved no such "right" in the trust instrument or otherwise. The term "right," certainly when used in a tax statute, must be given its normal and customary meaning. It connotes an ascertainable and legally enforceable power, such as that involved in O'Malley.[9] Here, the right ascribed to Byrum was the power to use his majority position and influence over the corporate directors to "regulate the flow of dividends" to the trust. That "right" was *137 neither ascertainable nor legally enforceable and hence was not a right in any normal sense of that term.[10] Byrum did retain the legal right to vote shares held by the trust and to veto investments and reinvestments. But the corporate trustee alone, not Byrum, had the right to pay out or withhold income and thereby to designate who among the beneficiaries enjoyed such income. Whatever power Byrum may have possessed with respect to the flow of income into the trust was derived not from an enforceable legal right specified in the trust instrument, but from the fact that he could elect a majority of the directors of the three corporations. The power to elect the directors conferred no legal right to command them to pay or not to pay dividends. A majority shareholder has a fiduciary duty not to misuse his power by promoting his personal interests at the expense of corporate interests.[11] Moreover, *138 the directors also have a fiduciary duty to promote the interests of the corporation.[12] However great Byrum's influence may have been with the corporate directors, their responsibilities were to all stockholders and were enforceable according to legal standards entirely unrelated to the needs of the trust or to Byrum's desires with respect thereto. The Government seeks to equate the de facto position of a controlling stockholder with the legally enforceable "right" specified by the statute. Retention of corporate control (through the right to vote the shares) is said to be "tantamount to the power to accumulate income" in the trust which resulted in estate-tax consequences in O'Malley. The Government goes on to assert that "[t]hrough exercise of that retained power, [Byrum] could increase or decrease corporate dividends. and thereby shift or defer the beneficial enjoyment of trust income."[13] This approach seems to us *139 not only to depart from the specific statutory language,[14] but also to misconceive the realities of corporate life. There is no reason to suppose that the three corporations controlled by Byrum were other than typical small businesses. The customary vicissitudes of such enterprises bad years; product obsolescence; new competition; disastrous litigation; new, inhibiting Government regulations; even bankruptcyprevent any certainty or predictability as to earnings or dividends. There is no assurance that a small corporation will have a flow of net earnings or that income earned will in fact be available for dividends. Thus, Byrum's alleged de facto "power to *140 control the flow of dividends" to the trust was subject to business and economic variables over which he had little or no control. Even where there are corporate earnings, the legal power to declare dividends is vested solely in the corporate board. In making decisions with respect to dividends, the board must consider a number of factors. It must balance the expectation of stockholders to reasonable dividends when earned against corporate needs for retention of earnings. The first responsibility of the board is to safeguard corporate financial viability for the long term. This means, among other things, the retention of sufficient earnings to assure adequate working capital as well as resources for retirement of debt, for replacement and modernization of plant and equipment, and for growth and expansion. The nature of a corporation's business, as well as the policies and long-range plans of management, are also relevant to dividend payment decisions.[15] Directors of a closely held, small corporation must bear in mind the relatively limited access of such an enterprise to capital markets. This may require a more conservative policy with respect to dividends than would be expected of an established corporation with securities listed on national exchanges.[16] *141 Nor do small corporations have the flexibility or the opportunity available to national concerns in the utilization of retained earnings. When earnings are substantial, a decision not to pay dividends may result only in the accumulation of surplus rather than growth through internal or external expansion. The accumulated earnings may result in the imposition of a penalty tax.[17] These various economic considerations are ignored at the directors' peril. Although vested with broad discretion in determining whether, when, and what amount of dividends shall be paid, that discretion is subject to legal restraints. If, in obedience to the will of the majority stockholder, corporate directors disregard the interests of shareholders by accumulating earnings to an unreasonable extent, they are vulnerable to a derivative suit.[18] They are similarly vulnerable if they make an unlawful payment of dividends in the absence of net earnings or available surplus,[19] or if they fail to exercise *142 the requisite degree of care in discharging their duty to act only in the best interest of the corporation and its stockholders. Byrum was similarly inhibited by a fiduciary duty from abusing his position as majority shareholder for personal or family advantage to the detriment of the corporation or other stockholders. There were a substantial number of minority stockholders in these corporations who were unrelated to Byrum.[20] Had Byrum and the directors violated their duties, the minority shareholders would have had a cause of action under Ohio law.[21] The Huntington National Bank, as trustee, was one of the minority stockholders, and it had both the right and the duty to hold Byrum responsible for any wrongful or negligent action as a controlling stockholder or as a director of the corporations.[22] Although Byrum had reserved the right to remove the trustee, he would have been imprudent to do this when confronted by the *143 trustee's complaint against his conduct. A successor trustee would succeed to the rights of the one removed. We conclude that Byrum did not have an unconstrained de facto power to regulate the flow of dividends to the trust, much less the "right" to designate who was to enjoy the income from trust property. His ability to affect, but not control, trust income, was a qualitatively different power from that of the settlor in O'Malley, who had a specific and enforceable right to control the income paid to the beneficiaries.[23] Even had Byrum managed to flood the trust with income, he had no way of compelling the trustee to pay it out rather than accumulate it. Nor could he prevent the trustee from making payments from other trust assets,[24] although admittedly there were few of these at the time of Byrum's death. We cannot assume, however, that no other assets would come into the trust from reinvestments or other gifts.[25] *144 We find no merit to the Government's contention that Byrum's de facto "control," subject as it was to the economic and legal constraints set forth above, was tantamount to the right to designate the persons who shall enjoy trust income, specified by 2036 (a) (2).[26] *145 II The Government asserts an alternative ground for including the shares transferred to the trust within Byrum's gross estate. It argues that by retaining control, Byrum guaranteed himself continued employment and remuneration, as well as the right to determine whether and when the corporations would be liquidated or merged. Byrum is thus said to have retained "the enjoyment of the property" making it includable within his gross estate under 2036 (a) (1). The Government concedes that the retention of the voting rights of an "unimportant minority interest" would not require inclusion of the transferred shares under 2036 (a) (1). It argues, however, "where the cumulative effect of the retained powers and the rights flowing from the shares not placed in trust leaves the grantor in control of a close corporation, and assures that control for his lifetime, he has retained the `enjoyment' of the transferred stock."[27] Brief for United States 23. It is well settled that the terms "enjoy" and "enjoyment," as used in various estate tax statutes, "are not terms of art, but connote substantial present economic benefit rather than technical vesting of title or estates."[28] For example, in in which the critical inquiry was whether the decedent had created a trust "intended. `to take effect in possession or enjoyment at or after his death,' "[29] at 348, the Court held that reserved powers of management of trust assets, similar to Byrum's power over the three corporations, did not subject an inter vivos trust to the federal estate tax. In determining whether the settlor had retained the enjoyment of the transferred property, the Court said: "Nor did the reserved powers of management of the trusts save to decedent any control over the economic benefits or the enjoyment of the property. He would equally have reserved all these powers and others had he made himself the trustee, but the transfer would not for that reason have been incomplete. The shifting of the economic interest in the trust property which was the subject of the tax was thus complete as soon as the trust was made. His power to recall the property and of control over it for his own benefit then ceased and as the trusts were not made in contemplation *147 of death, the reserved powers do not serve to distinguish them from any other gift inter vivos not subject to the tax." -347. The cases cited by the Government reveal that the terms "possession" and "enjoyment," used in 2036 (a) (1), were used to deal with situations in which the owner of property divested himself of title but retained an income interest or, in the case of real property, the lifetime use of the property. Mr. Justice Black's opinion for the Court in Church, traces the history of the concept. In none of the cases cited by the Government has a court held that a person has retained possession or enjoyment of the property if he has transferred title irrevocably, made complete delivery of the property and relinquished the right to income where the property is income producing.[30] The Government cites only one case, Estate of[31] in which a decedent had retained the right to vote transferred shares of stock and in which the stock was included *148 within the decedent's gross estate. In that case, it was not the mere power to vote the stock, giving the decedent control of the corporation, which caused the Tax Court to include the shares. The court held that " `on an inclusive view of the whole arrangement, this withholding of the income until decedent's death, coupled with the retention of the certificates under the pledge and the reservation of the right to vote the stock and to designate the company officers' " subjects the stock to inclusion within the gross estate. The settlor in Holland retained a considerably greater interest than Byrum retained, including an income interest.[32] As the Government concedes, the mere retention of the right-to-vote shares does not constitute the type of "enjoyment" in the property itself contemplated by 2036 (a) (1). In addition to being against the weight of precedent, the Government's argument that Byrum retained "enjoyment" within the meaning of 2036 (a) (1) is conceptually unsound. This argument implies, as it must under the express language of 2036 (a), that Byrum "retained for his life (1) the possession or enjoyment" of the "property" transferred to the trust or the "income" therefrom. The only property he transferred was corporate stock. He did not transfer "control" (in the sense used by the Government) as the trust never owned as much as 50% of the stock of any corporation. Byrum never divested himself of control, as he was able to vote a majority of the shares by virtue of what he owned and the right to vote those placed in *149 the trust. Indeed, at the time of his death he still owned a majority of the shares in the largest of the corporations and probably would have exercised control of the other two by virtue of being a large stockholder in each.[33] The statutory language plainly contemplates retention of an attribute of the property transferredsuch as a right to income, use of the property itself, or a power of appointment with respect either to income or principal.[34] Even if Byrum had transferred a majority of the stock, but had retained voting control, he would not have retained "substantial present economic benefit," The Government points to the retention of two "benefits." The first of these, the power to liquidate or *150 merge, is not a present benefit; rather, it is a speculative and contingent benefit which may or may not be realized. Nor is the probability of continued employment and compensation the substantial "enjoyment of [the transferred] property" within the meaning of the statute. The dominant stockholder in a closely held corporation, if he is active and productive, is likely to hold a senior position and to enjoy the advantage of a significant voice in his own compensation. These are inevitable facts of the free-enterprise system, but the influence and capability of a controlling stockholder to favor himself are not without constraints. Where there are minority stockholders, as in this case, directors may be held accountable if their employment, compensation, and retention of officers violate their duty to act reasonably in the best interest of the corporation and all of its stockholders.[35] Moreover, this duty is policed, albeit indirectly, by the Internal Revenue Service, which disallows the deduction of unreasonable compensation paid to a corporate executive as a business expense.[36] We conclude that Byrum's retention of voting control was not the retention of the enjoyment of the transferred property within the meaning of the statute. *151 For the reasons set forth above, we hold that this case was correctly decided by the Court of Appeals and accordingly the judgment is Affirmed. MR. JUSTICE WHITE, with whom MR. JUSTICE BRENNAN and MR. |
per_curiam | per_curiam | true | Zant v. Stephens | 1982-05-03T00:00:00 | null | https://www.courtlistener.com/opinion/110702/zant-v-stephens/ | https://www.courtlistener.com/api/rest/v3/clusters/110702/ | 1,982 | 1981-086 | 1 | 6 | 3 | The respondent was convicted of murder in a Georgia Superior Court. His sentencing jury found the following statutory aggravating circumstances:[1]
*412 "(1) that the offense of murder was committed by a person with a prior record of conviction of a capital felony, Code Ann. § 27-2534.1(b)(1); (2) that the murder was committed by a person who has a substantial history of serious assaultive criminal convictions, Code Ann. § 27-2534.1(b)(1), supra; and, (3) that the offense of murder was committed by a person who had escaped from the lawful custody of a peace officer or a place of lawful *413 confinement, Code Ann. § 27-2534.1(b)(9)." Stephens v. Hopper, 241 Ga. 596, 597-598, 247 S.E.2d 92, 94, cert. denied, 439 U.S. 991 (1978).
The jury imposed the death penalty. On direct appeal, the Georgia Supreme Court affirmed. Stephens v. State, 237 Ga. 259, 227 S.E.2d 261, cert. denied, 429 U.S. 986 (1976). On the authority of Arnold v. State, 236 Ga. 534, 224 S.E.2d 386 (1976), it set aside the second statutory aggravating circumstance found by the jury. It upheld the death sentence, however, on the ground that in Arnold "that was the sole aggravating circumstance found by the jury," whereas in the case under review "the evidence supports the jury's findings of the other statutory aggravating circumstances, and consequently the sentence is not impaired." 237 Ga., at 261-262, 227 S. E. 2d, at 263.
After exhausting his state postconviction remedies, Stephens v. Hopper, supra, the respondent applied for a writ of habeas corpus in Federal District Court. Relief was denied by that court, but the United States Court of Appeals for the Fifth Circuit "reverse[d] the district court's denial of habeas corpus relief insofar as it le[ft] standing the [respondent's] death sentence, and . . . remanded for further proceedings." 631 F.2d 397, 407 (1980), modified, 648 F.2d 446 (1981). We granted the petition for certiorari. 454 U.S. 814.
In Gregg v. Georgia, 428 U.S. 153 (1976), we upheld the Georgia death penalty statute because the standards and procedures set forth therein promised to alleviate to a significant degree the concern of Furman v. Georgia, 408 U.S. 238 (1972), that the death penalty not be imposed capriciously or in a freakish manner. We recognized that the constitutionality of Georgia death sentences ultimately would depend on the Georgia Supreme Court's construing the statute and reviewing capital sentences consistently with this concern. See 428 U.S., at 198, 201-206 (opinion of Stewart, POWELL, *414 and STEVENS, JJ.); id., at 211-212, 222-224 (WHITE, J., concurring in judgment). Our review of the statute did not lead us to examine all of its nuances. It was only after the state law relating to capital sentencing was clarified in concrete cases that we confronted and addressed more specific constitutional challenges in Coker v. Georgia, 433 U.S. 584 (1977), Presnell v. Georgia, 439 U.S. 14 (1978), Green v. Georgia, 442 U.S. 95 (1979), and Godfrey v. Georgia, 446 U.S. 420 (1980).
Today, we are asked to decide whether a reviewing court constitutionally may sustain a death sentence as long as at least one of a plurality of statutory aggravating circumstances found by the jury is valid and supported by the evidence. The Georgia Supreme Court consistently has asserted that authority.[2] Its construction of state law is clear: "Where two or more statutory aggravating circumstances are found by the jury, the failure of one circumstance does not so taint the proceedings as to invalidate the other aggravating circumstance found and the sentence of death based thereon." Gates v. State, 244 Ga. 587, 599, 261 S.E.2d 349, 358 (1979), cert. denied, 445 U.S. 938 (1980).
Despite the clarity of the state rule we are asked to review, there is considerable uncertainty about the state-law premises *415 of that rule.[3] The Georgia Supreme Court has never explained the rationale for its position. It may be that implicit in the rule is a determination that multiple findings of statutory aggravating circumstances are superfluous, or a determination that the reviewing court may assume the role of the jury when the sentencing jury recommended the death penalty under legally erroneous instructions. In this Court, the Georgia Attorney General offered as his understanding the following construction of state law: The jury must first find whether one or more statutory aggravating circumstances *416 have been established beyond a reasonable doubt. The existence of one or more aggravating circumstances is a threshold finding that authorizes the jury to consider imposing the death penalty; it serves as a bridge that takes the jury from the general class of all murders to the narrower class of offenses the state legislature has determined warrant the death penalty. After making the finding that the death penalty is a possible punishment, the jury then makes a separate finding whether the death penalty should be imposed. It bases this finding "not upon the statutory aggravating circumstances but upon all the evidence before the jury in aggravation and mitigation of punishment which ha[s] been introduced at both phases of the trial." Brief for Petitioner 13.
In view of the foregoing uncertainty, it would be premature to decide whether such determinations, or any of the others we might conceive as a basis for the Georgia Supreme Court's position, might undermine the confidence we expressed in Gregg v. Georgia, 428 U.S. 153 (1976), that the Georgia capital-sentencing system, as we understood it then, would avoid the arbitrary and capricious imposition of the death penalty and would otherwise pass constitutional muster. Suffice it to say that the state-law premises of the Georgia Supreme Court's conclusion of state law are relevant to the constitutional issue at hand.
The Georgia Supreme Court under certain circumstances will decide questions of state law upon certification from this Court. See Ga. Code § 24-4536 (Supp. 1980).[4] We invoke that statute to certify the following question: What are the premises of state law that support the conclusion that the death sentence in this case is not impaired by the invalidity of *417 one of the statutory aggravating circumstances found by the jury?
The Clerk of this Court is directed to transmit this certificate, signed by THE CHIEF JUSTICE and under the official seal of the Court, as well as the briefs and record filed with the Court, to the Supreme Court of Georgia, and simultaneously to transmit copies of the certificate to the attorneys for the respective parties.
It is so ordered. | The respondent was convicted of murder in a Georgia Superior Court. His sentencing jury found the following statutory aggravating circumstances:[1] *412 "(1) that the offense of murder was committed by a person with a prior record of conviction of a capital felony, Code Ann. 27-2534.1(b)(1); (2) that the murder was committed by a person who has a substantial history of serious assaultive criminal convictions, Code Ann. 27-2534.1(b)(1), and, (3) that the offense of murder was committed by a person who had escaped from the lawful custody of a peace officer or a place of lawful *413 confinement, Code Ann. 27-2534.1(b)(9)." The jury imposed the death penalty. On direct appeal, the Georgia Supreme Court affirmed. On the authority of it set aside the second statutory aggravating circumstance found by the jury. It upheld the death sentence, however, on the ground that in Arnold "that was the sole aggravating circumstance found by the jury," whereas in the case under review "the evidence supports the jury's findings of the other statutory aggravating circumstances, and consequently the sentence is not impaired." -262, 227 S. E. 2d, at 263. After exhausting his state postconviction remedies, the respondent applied for a writ of habeas corpus in Federal District Court. Relief was denied by that court, but the United States Court of Appeals for the Fifth Circuit "reverse[d] the district court's denial of habeas corpus relief insofar as it le[ft] standing the [respondent's] death sentence, and remanded for further proceedings." modified, We granted the petition for certiorari. In we upheld the Georgia death penalty statute because the standards and procedures set forth therein promised to alleviate to a significant degree the concern of that the death penalty not be imposed capriciously or in a freakish manner. We recognized that the constitutionality of Georgia death sentences ultimately would depend on the Georgia Supreme Court's construing the statute and reviewing capital sentences consistently with this concern. See 201-206 ; Our review of the statute did not lead us to examine all of its nuances. It was only after the state law relating to capital sentencing was clarified in concrete cases that we confronted and addressed more specific constitutional challenges in and Today, we are asked to decide whether a reviewing court constitutionally may sustain a death sentence as long as at least one of a plurality of statutory aggravating circumstances found by the jury is valid and supported by the evidence. The Georgia Supreme Court consistently has asserted that authority.[2] Its construction of state law is clear: "Where two or more statutory aggravating circumstances are found by the jury, the failure of one circumstance does not so taint the proceedings as to invalidate the other aggravating circumstance found and the sentence of death based thereon." cert. denied, Despite the clarity of the state rule we are asked to review, there is considerable uncertainty about the state-law premises *415 of that rule.[3] The Georgia Supreme Court has never explained the rationale for its position. It may be that implicit in the rule is a determination that multiple findings of statutory aggravating circumstances are superfluous, or a determination that the reviewing court may assume the role of the jury when the sentencing jury recommended the death penalty under legally erroneous instructions. In this Court, the Georgia Attorney General offered as his understanding the following construction of state law: The jury must first find whether one or more statutory aggravating circumstances *416 have been established beyond a reasonable doubt. The existence of one or more aggravating circumstances is a threshold finding that authorizes the jury to consider imposing the death penalty; it serves as a bridge that takes the jury from the general class of all murders to the narrower class of offenses the state legislature has determined warrant the death penalty. After making the finding that the death penalty is a possible punishment, the jury then makes a separate finding whether the death penalty should be imposed. It bases this finding "not upon the statutory aggravating circumstances but upon all the evidence before the jury in aggravation and mitigation of punishment which ha[s] been introduced at both phases of the trial." Brief for Petitioner 13. In view of the foregoing uncertainty, it would be premature to decide whether such determinations, or any of the others we might conceive as a basis for the Georgia Supreme Court's position, might undermine the confidence we expressed in that the Georgia capital-sentencing system, as we understood it then, would avoid the arbitrary and capricious imposition of the death penalty and would otherwise pass constitutional muster. Suffice it to say that the state-law premises of the Georgia Supreme Court's conclusion of state law are relevant to the constitutional issue at hand. The Georgia Supreme Court under certain circumstances will decide questions of state law upon certification from this Court. See Ga. Code 24-4536[4] We invoke that statute to certify the following question: What are the premises of state law that support the conclusion that the death sentence in this case is not impaired by the invalidity of *417 one of the statutory aggravating circumstances found by the jury? The Clerk of this Court is directed to transmit this certificate, signed by THE CHIEF JUSTICE and under the official seal of the Court, as well as the briefs and record filed with the Court, to the Supreme Court of Georgia, and simultaneously to transmit copies of the certificate to the attorneys for the respective parties. It is so ordered. |
per_curiam | per_curiam | true | Butler v. Dexter | 1976-04-19T00:00:00 | null | https://www.courtlistener.com/opinion/109425/butler-v-dexter/ | https://www.courtlistener.com/api/rest/v3/clusters/109425/ | 1,976 | 1975-073 | 1 | 9 | 0 | This is an appeal under 28 U.S. C. § 1253 from an order of a three-judge District Court enjoining the appellants from prosecuting the appellee on the felony charge that his motion picture projector is a "criminal instrument" under § 16.01 of the Texas Penal Code.[1]*263 Since no substantial question about the constitutionality of § 16.01 has been raised, we dismiss the appeal for want of jurisdiction in this Court.[2]
The facts of this case are relatively simple. The appellee, Richard Dexter, ran the Fiesta Theatre in San Antonio, Tex., which in June and July 1974 was exhibiting the film "Deep Throat." On three[3] separate occasions, an officer of the San Antonio police force paid for admission, entered the theater, and viewed the film. The officer, on each occasion, then wrote out a "Motion for Adversary Hearing" to determine whether there was probable cause to seize the film for violating the Texas obscenity laws. Each time, a magistrate held a short "hearing" in the lobby of the theater, at which he heard the testimony of the police officer, then viewed the film. Each time, the magistrate then issued a warrant to seize the film and to seize the projector as a "criminal instrument" under § 16.01 of the Texas Penal Code. Appellee was then arrested and charged with "commercial obscenity" in violation of Texas Penal Code, § 43.23, and "use of a criminal instrument" in violation of § 16.01. The charge of commercial obscenity is a Class B misdemeanor, carrying a fine not to exceed $1,000, confinement not to exceed 180 days, or both.[4] Appellee did not, according to the trial court, pursue any complaint about these charges in the federal court. He was brought to trial on these charges in the state courts and they are not in issue here. His challenge, rather, was against the prosecutor's charging him with violations of the criminal *264 instruments statute for his possession of ordinary 16-mm. movie projectors. Violation of that statute is a third-degree felony, and carries a penalty of from 2 to 10 years' confinement and a fine not to exceed $5,000.[5] Although the felony complaints were lodged and appellee was forced to post some $31,000 in bonds, these charges were never presented to the grand jury.[6]
A "criminal instrument," for purposes of the Texas statute, is anything "specially designed, made, or adapted for the commission of an offense."[7] From an examination of the "clear language of the statute" and from an examination of the unofficial "practice commentary" to the statute, the District Court concluded that "[b]y no stretch of the imagination could this statute be used to cover the plaintiff's actions or the possession of an ordinary portable 16 millimeter motion picture projector with removable interchangeable reels."[8]
From its conclusion as to the obvious inapplicability of the statute, and from the prosecutor's failure to present the charges to the grand jury, the District Court found that "[c]harging the plaintiff with a § 16.01 violation . . . cannot have been undertaken with any design to actually convict the plaintiff of the crime. . . . Such a blatant use of an inappropriate statute, which bootstrapped the misdemeanor offense into a felony was effective in requiring *265 that bail for a felony offense be set, not once but several times. The authorities could not believe, however, that Dexter would ultimately be convicted."[9]
Appellants present several contentions regarding the jurisdiction of the District Court and the correctness of its decision. We do not reach these questions, however, as we have concluded that we have no jurisdiction to consider this case on direct appeal. Jurisdiction is predicated on 28 U.S. C. § 1253, granting the right of direct appeal from an order "granting an . . . injunction in any civil action . . . required by any Act of Congress to be heard and determined by a district court of three judges." Title 28 U.S. C. § 2281 provides that "[a]n . . . injunction restraining the enforcement, operation or execution of any State statute by restraining the action of any officer of such State in the enforcement or execution of such statute . . . shall not be granted . . . upon the ground of the unconstitutionality of such statute unless the application therefor is heard and determined by a district court of three judges . . . ." Under this statute a three-judge court is required if "a complaint seeks to enjoin a state statute on substantial grounds of federal unconstitutionality, . . . even though nonconstitutional grounds of attack are also alleged . . . ." Florida Lime Growers v. Jacobsen, 362 U.S. 73, 85 (1960). However, in this case the District Court ruled that the actions of the appellants were not taken in the enforcement of the statute and thus no serious question about the constitutionality of the statute was presented.
As noted above, the District Court found that the felony "criminal instruments" charges were made in bad faith and without any design actually to convict appellee on those charges. Rather, the felony charges were made as part of a pattern of harassment by the San *266 Antonio police designed to force appellee to stop exhibiting "Deep Throat." But the arrests and the charges were not made in any attempt to enforce § 16.01.[10] Nor was the injunction granted on the ground that § 16.01 was unconstitutional; rather, it was granted on the ground that the local officials had acted unconstitutionally in using that statute as a pretext for arrest and the setting of felony bonds when they knew that the statute was inapplicable and that no conviction could ever be obtained. Since no substantial question concerning the constitutionality of § 16.01 was presented to the District Court, a three-judge court was not required.[11] Cf. Bailey v. Patterson, 369 U.S. 31 (1962).
A somewhat better argument might be made that the prosecutor's actions were part of an effort to enforce the commercial obscenity statute, albeit in a somewhat irregular manner. However, it could not be contended that the District Court grounded its injunction in any way on the unconstitutionality of the commercial obscenity *267 statute; the constitutionality of that statute was not even considered in this case.[12]
Since a three-judge court was not required in this case, the appeal should have been taken to the Court of Appeals for the Fifth Circuit. Since the time for appeal may have passed, we vacate the judgment and remand to the District Court so that it may enter a fresh decree from which a timely appeal can, if desired, be taken. Gonzalez v. Automatic Employees Credit Union, 419 U.S. 90 (1974); Moody v. Flowers, 387 U.S. 97 (1967).
It is so ordered.
| This is an appeal under 28 U.S. C. 1253 from an order of a three-judge District Court enjoining the appellants from prosecuting the appellee on the felony charge that his motion picture projector is a "criminal instrument" under 16.01 of the Texas Penal Code.[1]*263 Since no substantial question about the constitutionality of 16.01 has been raised, we dismiss the appeal for want of jurisdiction in this Court.[2] The facts of this case are relatively simple. The appellee, Richard Dexter, ran the Fiesta Theatre in San Antonio, Tex., which in June and July 1974 was exhibiting the film "Deep Throat." On three[3] separate occasions, an officer of the San Antonio police force paid for admission, entered the theater, and viewed the film. The officer, on each occasion, then wrote out a "Motion for Adversary Hearing" to determine whether there was probable cause to seize the film for violating the Texas obscenity laws. Each time, a magistrate held a short "hearing" in the lobby of the theater, at which he heard the testimony of the police officer, then viewed the film. Each time, the magistrate then issued a warrant to seize the film and to seize the projector as a "criminal instrument" under 16.01 of the Texas Penal Code. Appellee was then arrested and charged with "commercial obscenity" in violation of Texas Penal Code, 43.23, and "use of a criminal instrument" in violation of 16.01. The charge of commercial obscenity is a Class B misdemeanor, carrying a fine not to exceed $1,000, confinement not to exceed 180 days, or both.[4] Appellee did not, according to the trial court, pursue any complaint about these charges in the federal court. He was brought to trial on these charges in the state courts and they are not in issue here. His challenge, rather, was against the prosecutor's charging him with violations of the criminal *264 instruments statute for his possession of ordinary 16-mm. movie projectors. Violation of that statute is a third-degree felony, and carries a penalty of from 2 to 10 years' confinement and a fine not to exceed $5,000.[5] Although the felony complaints were lodged and appellee was forced to post some $31,000 in bonds, these charges were never presented to the grand jury.[6] A "criminal instrument," for purposes of the Texas statute, is anything "specially designed, made, or adapted for the commission of an offense."[7] From an examination of the "clear language of the statute" and from an examination of the unofficial "practice commentary" to the statute, the District Court concluded that "[b]y no stretch of the imagination could this statute be used to cover the plaintiff's actions or the possession of an ordinary portable 16 millimeter motion picture projector with removable interchangeable reels."[8] From its conclusion as to the obvious inapplicability of the statute, and from the prosecutor's failure to present the charges to the grand jury, the District Court found that "[c]harging the plaintiff with a 16.01 violation cannot have been undertaken with any design to actually convict the plaintiff of the crime. Such a blatant use of an inappropriate statute, which bootstrapped the misdemeanor offense into a felony was effective in requiring *265 that bail for a felony offense be set, not once but several times. The authorities could not believe, however, that Dexter would ultimately be convicted."[9] Appellants present several contentions regarding the jurisdiction of the District Court and the correctness of its decision. We do not reach these questions, however, as we have concluded that we have no jurisdiction to consider this case on direct appeal. Jurisdiction is predicated on 28 U.S. C. 1253, granting the right of direct appeal from an order "granting an injunction in any civil action required by any Act of Congress to be heard and determined by a district court of three judges." Title 28 U.S. C. 2281 provides that "[a]n injunction restraining the enforcement, operation or execution of any State statute by restraining the action of any officer of such State in the enforcement or execution of such statute shall not be granted upon the ground of the unconstitutionality of such statute unless the application therefor is heard and determined by a district court of three judges" Under this statute a three-judge court is required if "a complaint seeks to enjoin a state statute on substantial grounds of federal unconstitutionality, even though nonconstitutional grounds of attack are also alleged" Florida Lime However, in this case the District Court ruled that the actions of the appellants were not taken in the enforcement of the statute and thus no serious question about the constitutionality of the statute was presented. As noted above, the District Court found that the felony "criminal instruments" charges were made in bad faith and without any design actually to convict appellee on those charges. Rather, the felony charges were made as part of a pattern of harassment by the San *266 Antonio police designed to force appellee to stop exhibiting "Deep Throat." But the arrests and the charges were not made in any attempt to enforce 16.01.[10] Nor was the injunction granted on the ground that 16.01 was unconstitutional; rather, it was granted on the ground that the local officials had acted unconstitutionally in using that statute as a pretext for arrest and the setting of felony bonds when they knew that the statute was inapplicable and that no conviction could ever be obtained. Since no substantial question concerning the constitutionality of 16.01 was presented to the District Court, a three-judge court was not required.[11] Cf. A somewhat better argument might be made that the prosecutor's actions were part of an effort to enforce the commercial obscenity statute, albeit in a somewhat irregular manner. However, it could not be contended that the District Court grounded its injunction in any way on the unconstitutionality of the commercial obscenity *267 statute; the constitutionality of that statute was not even considered in this case.[12] Since a three-judge court was not required in this case, the appeal should have been taken to the Court of Appeals for the Fifth Circuit. Since the time for appeal may have passed, we vacate the judgment and remand to the District Court so that it may enter a fresh decree from which a timely appeal can, if desired, be taken. ; It is so ordered. |
Justice Kagan | dissenting | false | Williams v. Illinois | 2012-06-18T00:00:00 | null | https://www.courtlistener.com/opinion/802772/williams-v-illinois/ | https://www.courtlistener.com/api/rest/v3/clusters/802772/ | 2,012 | 2011-068 | 1 | 5 | 4 | Some years ago, the State of California prosecuted a
man named John Kocak for rape. At a preliminary hear-
ing, the State presented testimony from an analyst at the
Cellmark Diagnostics Laboratory—the same facility used
to generate DNA evidence in this case. The analyst had
extracted DNA from a bloody sweatshirt found at the
crime scene and then compared it to two control samples—
one from Kocak and one from the victim. The analyst’s
report identified a single match: As she explained on
direct examination, the DNA found on the sweatshirt
belonged to Kocak. But after undergoing cross-
examination, the analyst realized she had made a mortify-
ing error. She took the stand again, but this time to admit
that the report listed the victim’s control sample as coming
from Kocak, and Kocak’s as coming from the victim. So
the DNA on the sweatshirt matched not Kocak, but the
victim herself. See Tr. in No. SCD110465 (Super. Ct. San
Diego Cty., Cal., Nov. 17, 1995), pp. 3–4 (“I’m a little hys-
terical right now, but I think . . . the two names should be
switched”), online at http: //www.nlada.org/forensics/for_
lib/Documents/1037341561.0/JohnIvanKocak.pdf (as vis-
ited June 15, 2012, and available in Clerk of Court’s case
file). In trying Kocak, the State would have to look else-
where for its evidence.
2 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
Our Constitution contains a mechanism for catching
such errors—the Sixth Amendment’s Confrontation
Clause. That Clause, and the Court’s recent cases inter-
preting it, require that testimony against a criminal de-
fendant be subject to cross-examination. And that com-
mand applies with full force to forensic evidence of the
kind involved in both the Kocak case and this one. In two
decisions issued in the last three years, this Court held
that if a prosecutor wants to introduce the results of fo-
rensic testing into evidence, he must afford the defendant
an opportunity to cross-examine an analyst responsible for
the test. Forensic evidence is reliable only when properly
produced, and the Confrontation Clause prescribes a par-
ticular method for determining whether that has hap-
pened. The Kocak incident illustrates how the Clause is
designed to work: Once confronted, the analyst discovered
and disclosed the error she had made. That error would
probably not have come to light if the prosecutor had
merely admitted the report into evidence or asked a third
party to present its findings. Hence the genius of an 18th-
century device as applied to 21st-century evidence: Cross-
examination of the analyst is especially likely to reveal
whether vials have been switched, samples contaminated,
tests incompetently run, or results inaccurately recorded.
Under our Confrontation Clause precedents, this is
an open-and-shut case. The State of Illinois prosecuted
Sandy Williams for rape based in part on a DNA profile
created in Cellmark’s laboratory. Yet the State did not
give Williams a chance to question the analyst who pro-
duced that evidence. Instead, the prosecution introduced
the results of Cellmark’s testing through an expert wit-
ness who had no idea how they were generated. That
approach—no less (perhaps more) than the confrontation-
free methods of presenting forensic evidence we have
formerly banned—deprived Williams of his Sixth Amend-
ment right to “confron[t] . . . the witnesses against him.”
Cite as: 567 U. S. ____ (2012) 3
KAGAN, J., dissenting
The Court today disagrees, though it cannot settle on a
reason why. JUSTICE ALITO, joined by three other Jus-
tices, advances two theories—that the expert’s summary of
the Cellmark report was not offered for its truth, and
that the report is not the kind of statement triggering the
Confrontation Clause’s protection. In the pages that
follow, I call JUSTICE ALITO’s opinion “the plurality,”
because that is the conventional term for it. But in all
except its disposition, his opinion is a dissent: Five Jus-
tices specifically reject every aspect of its reasoning
and every paragraph of its explication. See ante, at 1
(THOMAS, J., concurring in judgment) (“I share the dis-
sent’s view of the plurality’s flawed analysis”). JUSTICE
THOMAS, for his part, contends that the Cellmark report
is nontestimonial on a different rationale. But no other
Justice joins his opinion or subscribes to the test he offers.
That creates five votes to approve the admission of the
Cellmark report, but not a single good explanation. The
plurality’s first rationale endorses a prosecutorial dodge;
its second relies on distinguishing indistinguishable foren-
sic reports. JUSTICE THOMAS’s concurrence, though posit-
ing an altogether different approach, suffers in the end
from similar flaws. I would choose another path—to
adhere to the simple rule established in our decisions, for
the good reasons we have previously given. Because de-
fendants like Williams have a constitutional right to con-
front the witnesses against them, I respectfully dissent
from the Court’s fractured decision.
I
Our modern Confrontation Clause doctrine began with
Crawford v. Washington, 541 U.S. 36 (2004). About a
quarter century earlier, we had interpreted the Clause to
allow the admission of any out-of-court statement falling
within a “firmly rooted hearsay exception” or carrying
“particularized guarantees of trustworthiness.” Ohio v.
4 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
Roberts, 448 U.S. 56, 66 (1980). But in Crawford, we
concluded that our old approach was misguided. Drawing
on historical research about the Clause’s purposes, we
held that the prosecution may not admit “testimonial
statements of a witness who [does] not appear at trial
unless he [is] unavailable to testify, and the defendant . . .
had a prior opportunity for cross-examination.” 541 U. S.,
at 53–54. That holding has two aspects. First, the Con-
frontation Clause applies only to out-of-court statements
that are “testimonial.” Second, where the Clause applies,
it guarantees to a defendant just what its name sug-
gests—the opportunity to cross-examine the person who
made the statement. See id., at 59.
A few years later, we made clear that Crawford’s rule
reaches forensic reports. In Melendez-Diaz v. Massachu
setts, 557 U.S. 305 (2009), the Commonwealth introduced
a laboratory’s “ ‘certificates of analysis’ ” stating that a sub-
stance seized from the defendant was cocaine. Id., at
308. We held that the certificates fell within the Clause’s
“ ‘core class of testimonial statements’ ” because they had
a clear “evidentiary purpose”: They were “ ‘made under
circumstances which would lead an objective witness
reasonably to believe that [they] would be available for use
at a later trial.’ ” Id., at 310–311 (quoting Crawford, 541
U. S., at 51–52). Accordingly, we ruled, the defendant had
a right to cross-examine the analysts who had authored
them. In reaching that conclusion, we rejected the
Commonwealth’s argument that the Confrontation Clause
should not apply because the statements resulted from
“ ‘neutral scientific testing,’ ” and so were presumptively
reliable. 557 U. S., at 318. The Clause, we noted,
commands that “ ‘reliability be assessed in a particular
manner’ ”—through “ ‘testing in the crucible of cross-
examination.’ ” Id., at 317 (quoting Crawford, 541 U. S., at
61). Further, we doubted that the testing summarized
in the certificates was “as neutral or as reliable” as the
Cite as: 567 U. S. ____ (2012) 5
KAGAN, J., dissenting
Commonwealth suggested. Citing chapter and verse from
various studies, we concluded that “[f]orensic evidence is
not uniquely immune from the risk of manipulation” and
mistake. 557 U. S., at 318; see id., at 319.
And just two years later (and just one year ago), we
reiterated Melendez-Diaz’s analysis when faced with a
State’s attempt to evade it. In Bullcoming v. New Mexico,
564 U.S. ___ (2011), a forensic report showed the defend-
ant’s blood-alcohol concentration to exceed the legal limit
for drivers. The State tried to introduce that finding
through the testimony of a person who worked at the
laboratory but had not performed or observed the blood
test or certified its results. We held that Melendez-Diaz
foreclosed that tactic. The report, we stated, resembled
the certificates in Melendez-Diaz in “all material respects,”
564 U. S., at ___ (slip op., at 15): Both were signed docu-
ments providing the results of forensic testing designed to
“ ‘prov[e] some fact’ in a criminal proceeding,” id., at ___
(slip op., at 14) (quoting Melendez-Diaz, 557 U. S., at 310).
And the State’s resort to a “surrogate” witness, in place
of the analyst who produced the report, did not satisfy the
Confrontation Clause. Bullcoming, 564 U. S., at ___ (slip
op., at 12). Only the presence of “that particular scientist,”
we reasoned, would enable Bullcoming’s counsel to ask
“questions designed to reveal whether incompetence . . . or
dishonesty” had tainted the results. Id., at ___, ___ (slip
op., at 2, 12). Repeating the refrain of Melendez-Diaz, we
held that “[t]he accused’s right is to be confronted with”
the actual analyst, unless he is unavailable and the ac-
cused “had an opportunity, pretrial, to cross-examine”
him. Bullcoming, 564 U. S., at ___ (slip op., at 2).
This case is of a piece. The report at issue here shows a
DNA profile produced by an analyst at Cellmark’s labora-
tory, allegedly from a vaginal swab taken from a young
woman, L. J., after she was raped. That report is identical
to the one in Bullcoming (and Melendez-Diaz) in “all mate-
6 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
rial respects.” 564 U. S., at ___ (slip op., at 15). Once
again, the report was made to establish “ ‘some fact’ in a
criminal proceeding”—here, the identity of L. J.’s attacker.
Id., at ___ (slip op., at 14) (quoting Melendez-Diaz, 557
U. S., at 310); see infra, at 20. And once again, it details
the results of forensic testing on evidence gathered by the
police. Viewed side-by-side with the Bullcoming report,
the Cellmark analysis has a comparable title; similarly
describes the relevant samples, test methodology, and
results; and likewise includes the signatures of laboratory
officials. Compare Cellmark Diagnostics Report of Labor-
atory Examination (Feb. 15, 2001), Lodging of Petitioner
with App. in Bullcoming v. New Mexico, O. T. 2010, No.
09–10876, pp. 62–65. So under this Court’s prior analysis,
the substance of the report could come into evidence only
if Williams had a chance to cross-examine the responsible
analyst.
But that is not what happened. Instead, the prosecutor
used Sandra Lambatos—a state-employed scientist who
had not participated in the testing—as the conduit for this
piece of evidence. Lambatos came to the stand after two
other state analysts testified about forensic tests they had
performed. One recounted how she had developed a DNA
profile of Sandy Williams from a blood sample drawn after
his arrest. And another told how he had confirmed the
presence of (unidentified) semen on the vaginal swabs
taken from L. J. All this was by the book: Williams had
an opportunity to cross-examine both witnesses about the
tests they had run. But of course, the State still needed to
supply the missing link—it had to show that DNA found
in the semen on L. J.’s vaginal swabs matched Williams’s
DNA. To fill that gap, the prosecutor could have called the
analyst from Cellmark to testify about the DNA profile she
had produced from the swabs. But instead, the State
called Lambatos as an expert witness and had her testify
that the semen on those swabs contained Sandy Wil-
Cite as: 567 U. S. ____ (2012) 7
KAGAN, J., dissenting
liams’s DNA:
“Q Was there a computer match generated of the
male DNA profile found in semen from the vaginal
swabs of [L. J.] to a male DNA profile that had been
identified as having originated from Sandy Williams?
“A Yes, there was.
“Q Did you compare the semen . . . from the vaginal
swabs of [L. J.] to the male DNA profile . . . from the
blood of Sandy Williams?
“A Yes, I did.
. . . . .
“Q [I]s the semen identified in the vaginal swabs of
[L. J.] consistent with having originated from Sandy
Williams?
“A Yes.” App. 56–57.
And so it was Lambatos, rather than any Cellmark em-
ployee, who informed the trier of fact that the testing of
L. J.’s vaginal swabs had produced a male DNA profile
implicating Williams.
Have we not already decided this case? Lambatos’s
testimony is functionally identical to the “surrogate testi-
mony” that New Mexico proffered in Bullcoming, which
did nothing to cure the problem identified in Melendez-
Diaz (which, for its part, straightforwardly applied our
decision in Crawford). Like the surrogate witness in
Bullcoming, Lambatos “could not convey what [the actual
analyst] knew or observed about the events . . . , i.e., the
particular test and testing process he employed.” Bull
coming, 564 U. S., at ___ (slip op., at 12). “Nor could such
8 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
surrogate testimony expose any lapses or lies” on the
testing analyst’s part. Ibid. Like the lawyers in Melendez-
Diaz and Bullcoming, Williams’s attorney could not ask
questions about that analyst’s “proficiency, the care he
took in performing his work, and his veracity.” 564 U. S.,
at ___, n. 7 (slip op., at 12, n. 7). He could not probe
whether the analyst had tested the wrong vial, inverted
the labels on the samples, committed some more technical
error, or simply made up the results. See App. to Brief for
Public Defender Service for the District of Columbia et al.
as Amici Curiae 5a, 11a (describing mistakes and fraud
at Cellmark’s laboratory). Indeed, Williams’s lawyer was
even more hamstrung than Bullcoming’s. At least the
surrogate witness in Bullcoming worked at the relevant
laboratory and was familiar with its procedures. That is
not true of Lambatos: She had no knowledge at all of
Cellmark’s operations. Indeed, for all the record discloses,
she may never have set foot in Cellmark’s laboratory.
Under our case law, that is sufficient to resolve this
case. “[W]hen the State elected to introduce” the sub-
stance of Cellmark’s report into evidence, the analyst who
generated that report “became a witness” whom Williams
“had the right to confront.” Bullcoming, 564 U. S., at ___
(slip op., at 13). As we stated just last year, “Our prece-
dent[s] cannot sensibly be read any other way.” Ibid.
II
The plurality’s primary argument to the contrary tries
to exploit a limit to the Confrontation Clause recognized in
Crawford. “The Clause,” we cautioned there, “does not bar
the use of testimonial statements for purposes other than
establishing the truth of the matter asserted.” 541 U. S.,
at 59–60, n. 9 (citing Tennessee v. Street, 471 U.S. 409,
414 (1985)). The Illinois Supreme Court relied on that
statement in concluding that Lambatos’s testimony was
permissible. On that court’s view, “Lambatos disclosed
Cite as: 567 U. S. ____ (2012) 9
KAGAN, J., dissenting
the underlying facts from Cellmark’s report” not for their
truth, but “for the limited purpose of explaining the basis
for her [expert] opinion,” so that the factfinder could as-
sess that opinion’s value. 238 Ill. 2d 125, 150, 939 N.E.
2d 268, 282 (2010). The plurality wraps itself in that
holding, similarly asserting that Lambatos’s recitation of
Cellmark’s findings, when viewed through the prism of
state evidence law, was not introduced to establish “the
truth of any . . . matter concerning [the] Cellmark” report.
Ante, at 16; see ante, at 2, 24–25. But five Justices agree,
in two opinions reciting the same reasons, that this
argument has no merit: Lambatos’s statements about
Cellmark’s report went to its truth, and the State could
not rely on her status as an expert to circumvent the
Confrontation Clause’s requirements. See ante, at 2–8
(opinion of THOMAS, J.).
To see why, start with the kind of case Crawford had in
mind. In acknowledging the not-for-the-truth carveout
from the Clause, the Court cited Tennessee v. Street as
exemplary. See Crawford, 541 U. S., at 59–60, n. 9.
There, Street claimed that his stationhouse confession of
murder was a sham: A police officer, he charged, had read
aloud his alleged accomplice’s confession and forced him to
repeat it. To help rebut that defense, the State introduced
the other confession into the record, so the jury could see
how it differed from Street’s. This Court rejected Street’s
Confrontation Clause claim because the State had offered
the out-of-court statement not to prove “the truth of
[the accomplice’s] assertions” about the murder, but only to
disprove Street’s claim of how the police elicited his con-
fession. Street, 471 U. S., at 413. Otherwise said, the
truth of the admitted statement was utterly immaterial;
the only thing that mattered was that the statement
(whether true or false) varied from Street’s.
The situation could not be more different when a wit-
ness, expert or otherwise, repeats an out-of-court state-
10 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
ment as the basis for a conclusion, because the statement’s
utility is then dependent on its truth. If the statement is
true, then the conclusion based on it is probably true; if
not, not. So to determine the validity of the witness’s
conclusion, the factfinder must assess the truth of the out-
of-court statement on which it relies. That is why the
principal modern treatise on evidence variously calls the
idea that such “basis evidence” comes in not for its truth,
but only to help the factfinder evaluate an expert’s opin-
ion “very weak,” “factually implausible,” “nonsense,” and
“sheer fiction.” D. Kaye, D. Bernstein, & J. Mnookin, The
New Wigmore: Expert Evidence §4.10.1, pp. 196–197 (2d
ed. 2011); id., §4.11.6, at 24 (Supp. 2012). “One can sym-
pathize,” notes that treatise, “with a court’s desire to
permit the disclosure of basis evidence that is quite prob-
ably reliable, such as a routine analysis of a drug, but to
pretend that it is not being introduced for the truth of its
contents strains credibility.” Id., §4.10.1, at 198 (2d ed.
2011); see also, e.g., People v. Goldstein, 6 N.Y. 3d 119,
128, 843 N.E.2d 727, 732–733 (2005) (“The distinction
between a statement offered for its truth and a statement
offered to shed light on an expert’s opinion is not meaning-
ful”). Unlike in Street, admission of the out-of-court
statement in this context has no purpose separate from its
truth; the factfinder can do nothing with it except assess
its truth and so the credibility of the conclusion it serves to
buttress.1
——————
1 In responding to this reasoning, the plurality confirms it. According
to the plurality, basis evidence supports the “credibility of the expert’s
opinion” by showing that he has relied on, and drawn logical inferences
from, sound “factual premises.” Ante, at 24. Quite right. And that
process involves assessing such premises’ truth: If they are, as the
plurality puts it, “unsupported by other evidence in the record” or
otherwise baseless, they will not “allay [a factfinder’s] fears” about an
“expert’s reasoning.” Ante, at 24–25. I could not have said it any
better.
Cite as: 567 U. S. ____ (2012) 11
KAGAN, J., dissenting
Consider a prosaic example not involving scientific ex-
perts. An eyewitness tells a police officer investigating
an assault that the perpetrator had an unusual, star-
shaped birthmark over his left eye. The officer arrests a
person bearing that birthmark (let’s call him Starr) for
committing the offense. And at trial, the officer takes the
stand and recounts just what the eyewitness told him.
Presumably the plurality would agree that such testimony
violates the Confrontation Clause unless the eyewitness is
unavailable and the defendant had a prior opportunity to
cross-examine him. Now ask whether anything changes if
the officer couches his testimony in the following way: “I
concluded that Starr was the assailant because a reliable
eyewitness told me that the assailant had a star-shaped
birthmark and, look, Starr has one just like that.” Surely
that framing would make no constitutional difference,
even though the eyewitness’s statement now explains the
basis for the officer’s conclusion. It remains the case that
the prosecution is attempting to introduce a testimonial
statement that has no relevance to the proceedings apart
from its truth—and that the defendant cannot cross-
examine the person who made it. Allowing the admission
of this evidence would end-run the Confrontation Clause,
and make a parody of its strictures.
And that example, when dressed in scientific clothing, is
no different from this case. The Cellmark report identified
the rapist as having a particular DNA profile (think of
it as the quintessential birthmark). The Confrontation
Clause prevented the State from introducing that report
into evidence except by calling to the stand the person who
prepared it. See Melendez-Diaz, 557 U. S., at 310–311;
Bullcoming, 564 U. S., at ___ (slip op., at 2). So the State
tried another route—introducing the substance of the re-
port as part and parcel of an expert witness’s conclusion.
In effect, Lambatos testified (like the police officer above):
“I concluded that Williams was the rapist because Cell-
12 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
mark, an accredited and trustworthy laboratory, says
that the rapist has a particular DNA profile and, look,
Williams has an identical one.” And here too, that form
of testimony should change nothing. The use of the
Cellmark statement remained bound up with its truth,
and the statement came into evidence without any oppor-
tunity for Williams to cross-examine the person who made
it. So if the plurality were right, the State would have a
ready method to bypass the Constitution (as much as in
my hypothetical case); a wink and a nod, and the Confron-
tation Clause would not pose a bar to forensic evidence.
The plurality tries to make plausible its not-for-the-
truth rationale by rewriting Lambatos’s testimony about
the Cellmark report. According to the plurality, Lambatos
merely “assumed” that Cellmark’s DNA profile came from
L. J.’s vaginal swabs, accepting for the sake of argument
the prosecutor’s premise. Ante, at 18. But that is incor-
rect. Nothing in Lambatos’s testimony indicates that she
was making an assumption or considering a hypothesis.
To the contrary, Lambatos affirmed, without qualification,
that the Cellmark report showed a “male DNA profile
found in semen from the vaginal swabs of [L. J.].” App.
56. Had she done otherwise, this case would be different.
There was nothing wrong with Lambatos’s testifying that
two DNA profiles—the one shown in the Cellmark report
and the one derived from Williams’s blood—matched each
other; that was a straightforward application of Lamba-
tos’s expertise. Similarly, Lambatos could have added
that if the Cellmark report resulted from scientifically
sound testing of L. J.’s vaginal swab, then it would link
Williams to the assault. What Lambatos could not do was
what she did: indicate that the Cellmark report was pro-
duced in this way by saying that L. J.’s vaginal swab
contained DNA matching Williams’s.2 By testifying in
——————
2 The plurality suggests that Lambatos’s testimony is merely a mod-
Cite as: 567 U. S. ____ (2012) 13
KAGAN, J., dissenting
that manner, Lambatos became just like the surrogate
witness in Bullcoming—a person knowing nothing about
“the particular test and testing process,” but vouching for
them regardless. 564 U. S., at ___ (slip op., at 12). We
have held that the Confrontation Clause requires some-
thing more.
The plurality also argues that Lambatos’s characteriza-
tion of the Cellmark report did not violate the Confronta-
tion Clause because the case “involve[d] a bench trial.”
Ante, at 19 (emphasis deleted). I welcome the plurality’s
concession that the Clause might forbid presenting Lam-
batos’s statement to a jury, see ante, at 18–19; it indicates
that the plurality realizes that her testimony went beyond
an “assumption.” But the presence of a judge does not
transform the constitutional question. In applying the
Confrontation Clause, we have never before considered
relevant the decisionmaker’s identity. See, e.g., Davis v.
——————
ern, streamlined way of answering hypothetical questions and therefore
raises no constitutional issue, see ante, at 2, 13–15; similarly, the
plurality contends that the difference between what Lambatos said and
what I would allow involves only “slightly revis[ing]” her testimony and
so can be of no consequence, see ante, at 18, n. 3. But the statement “if
X is true, then Y follows” differs materially—and constitutionally—
from the statement “Y is true because X is true (according to Z).” The
former statement is merely a logical proposition, whose validity the
defendant can contest by questioning the speaker. And then, assum-
ing the prosecutor tries to prove the statement’s premise through some
other witness, the defendant can rebut that effort through cross-
examination. By contrast, the latter statement as well contains a
factual allegation (that X is true), which the defendant can only effec-
tively challenge by confronting the person who made it (Z). That is why
recognizing the difference between these two forms of testimony is not
to insist on an archaism or a formality, but to ensure, in line with the
Constitution, that defendants have the ability to confront their accus-
ers. And if prosecutors can easily conform their conduct to that consti-
tutional directive, as the plurality suggests, so much the better: I would
not have thought it a ground of complaint that the Confrontation
Clause, properly understood, manages to protect defendants without
overly burdening the State.
14 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
Washington, 547 U.S. 813 (2006). And this case would
be a poor place to begin. Lambatos’s description of the
Cellmark report was offered for its truth because that is
all such “basis evidence” can be offered for; as described
earlier, the only way the factfinder could consider whether
that statement supported her opinion (that the DNA on
L. J.’s swabs came from Williams) was by assessing the
statement’s truth. See supra, at 9–12. That is so, as a
simple matter of logic, whether the factfinder is a judge or
a jury. And thus, in either case, admission of the state-
ment, without the opportunity to cross-examine, violates
the Confrontation Clause. See ante, at 3–4, n. 1 (opinion
of THOMAS, J.).
In saying that much, I do not doubt that a judge typi-
cally will do better than a jury in excluding such inadmis-
sible evidence from his decisionmaking process. Perhaps
the judge did so here; perhaps, as the plurality thinks, he un-
derstood that he could not consider Lambatos’s repre-
sentation about the Cellmark report, and found that other,
“circumstantial evidence” established “the source of the
sample that Cellmark tested” and “the reliability of the
Cellmark profile.” See ante, at 22–23. Some indications
are to the contrary: In delivering his verdict, the judge
never referred to the circumstantial evidence the plurality
marshals, but instead focused only on Lambatos’s testi-
mony. See 4 Record JJJ151 (calling Lambatos “the best
DNA witness I have ever heard” and referring to Williams
as “the guy whose DNA, according to the evidence from
the experts, is in the semen recovered from the victim’s
vagina”). But I take the plurality’s point that when read
“[i]n context” the judge’s statements might be “best under-
stood” as meaning something other than what they appear
to say. See ante, at 20, n. 6. Still, that point suggests only
that the admission of Lambatos’s statement was harm-
less—that the judge managed to put it out of mind. After
all, whether a factfinder is confused by an error is a sepa-
Cite as: 567 U. S. ____ (2012) 15
KAGAN, J., dissenting
rate question from whether an error has occurred. So the
plurality’s argument does not answer the only question
this case presents: whether a constitutional violation
happened when Lambatos recited the Cellmark report’s
findings.3
At bottom, the plurality’s not-for-the-truth rationale is a
simple abdication to state-law labels. Although the utility
of the Cellmark statement that Lambatos repeated logi-
cally depended on its truth, the plurality thinks this case
decided by an Illinois rule holding that the facts underly-
ing an expert’s opinion are not admitted for that purpose.
See ante, at 14–18; People v. Pasch, 152 Ill. 2d 133, 175–
177, 604 N.E.2d 294, 311 (1992). But we do not typically
allow state law to define federal constitutional require-
ments. And needless to say (or perhaps not), the Confron-
——————
3 The plurality asserts (without citation) that I am “reach[ing] the
truly remarkable conclusion that the wording of Lambatos’ testimony
confused the trial judge,” ante, at 19, and then spends three pages
explaining why that conclusion is wrong, see ante, at 19–21. But the
plurality is responding to an argument of its own imagining, because I
reach no such conclusion. As I just stated, the trial judge might well
have ignored Lambatos’s statement about the Cellmark report and
relied on other evidence to conclude that “the Cellmark profile was
derived from the sample taken from the victim,” ante, at 19. All I am
saying is that the admission of that statement violated the Confronta-
tion Clause even if the judge ultimately put it aside, because it came
into evidence for nothing other than its truth. See supra, at 9–12.
Similarly, the plurality claims (still without citation) that I think the
other evidence about the Cellmark report insufficient, see ante, at 21.
But once again, the plurality must be reading someone else’s opinion. I
express no view on sufficiency of the evidence because it is irrelevant to
the Confrontation Clause issue we took this case to decide. It is the
plurality that wrongly links the two, spending another five pages
trumpeting the strength of the Cellmark report, see ante, at 22–24, 32–
33. But the plurality cannot properly decide whether a Confrontation
Clause violation occurred at Williams’s trial by determining that
Williams was guilty. The American criminal justice system works the
opposite way: determining guilt by holding trials in accord with consti-
tutional requirements.
16 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
tation Clause is a constitutional rule like any other. As
JUSTICE THOMAS observes, even before Crawford, we did
not allow the Clause’s scope to be “dictated by state or
federal evidentiary rules.” See ante, at 2. Indeed, in
Street, we independently reviewed whether an out-of-court
statement was introduced for its truth—the very question
at issue in this case. See 471 U. S., at 413–416. And in
Crawford, we still more firmly disconnected the Confron-
tation Clause inquiry from state evidence law, by overrul-
ing an approach that looked in part to whether an out-
of-court statement fell within a “ ‘firmly rooted hearsay
exception.’ ” 541 U. S., at 60 (quoting Roberts, 448 U. S., at
66). That decision made clear that the Confrontation
Clause’s protections are not coterminous with rules of
evidence. So the plurality’s state-law-first approach would
be an about-face.
Still worse, that approach would allow prosecutors to do
through subterfuge and indirection what we previously
have held the Confrontation Clause prohibits. Imagine
for a moment a poorly trained, incompetent, or dishonest
laboratory analyst. (The analyst in Bullcoming, placed on
unpaid leave for unknown reasons, might qualify.) Under
our precedents, the prosecutor cannot avoid exposing that
analyst to cross-examination simply by introducing his
report. See Melendez-Diaz, 557 U. S., at 311. Nor can the
prosecutor escape that fate by offering the results through
the testimony of another analyst from the laboratory. See
Bullcoming, 564 U. S., at ___ (slip op., at 2). But under
the plurality’s approach, the prosecutor could choose the
analyst-witness of his dreams (as the judge here said, “the
best DNA witness I have ever heard”), offer her as an
expert (she knows nothing about the test, but boasts im-
pressive degrees), and have her provide testimony identi-
cal to the best the actual tester might have given (“the
DNA extracted from the vaginal swabs matched Sandy
Williams’s”)—all so long as a state evidence rule says that
Cite as: 567 U. S. ____ (2012) 17
KAGAN, J., dissenting
the purpose of the testimony is to enable the factfinder to
assess the expert opinion’s basis. (And this tactic would
not be confined to cases involving scientific evidence. As
JUSTICE THOMAS points out, the prosecutor could similarly
substitute experts for all kinds of people making out-of-
court statements. See ante, at 7.) The plurality thus
would countenance the Constitution’s circumvention. If
the Confrontation Clause prevents the State from getting
its evidence in through the front door, then the State could
sneak it in through the back. What a neat trick—but
really, what a way to run a criminal justice system. No
wonder five Justices reject it.
III
The plurality also argues, as a “second, independent
basis” for its decision, that the Cellmark report falls out-
side the Confrontation Clause’s ambit because it is nontes-
timonial. Ante, at 3. The plurality tries out a number of
supporting theories, but all in vain: Each one either con-
flicts with this Court’s precedents or misconstrues this
case’s facts. JUSTICE THOMAS rejects the plurality’s views
for similar reasons as I do, thus bringing to five the num-
ber of Justices who repudiate the plurality’s understand-
ing of what statements count as testimonial. See ante, at
1, 12–15. JUSTICE THOMAS, however, offers a rationale
of his own for deciding that the Cellmark report is non-
testimonial. I think his essay works no better. When
all is said and done, the Cellmark report is a testimonial
statement.
A
According to the plurality, we should declare the
Cellmark report nontestimonial because “the use at trial
of a DNA report prepared by a modern, accredited labora-
tory ‘bears little if any resemblance to the historical prac-
tices that the Confrontation Clause aimed to eliminate.’ ”
Ante, at 33 (quoting Michigan v. Bryant, 562 U.S. ___, ___
18 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
(2011) (THOMAS, J., concurring in judgment) (slip op., at
2)). But we just last year treated as testimonial a forensic
report prepared by a “modern, accredited laboratory”;
indeed, we declared that the report at issue “fell within
the core class of testimonial statements” implicating the
Confrontation Clause. Bullcoming, 564 U. S., at ___ (slip
op., at 16) (internal quotation marks omitted); see Brief for
New Mexico Department of Health, Scientific Laboratory
Division as Amicus Curiae in Bullcoming, O. T. 2010, No.
09–10786, p. 1 (discussing accreditation). And although
the plurality is close, it is not quite ready (or able) to
dispense with that decision. See ante, at 29, n. 13 (“Expe-
rience might yet show that the holdings in [Bullcoming
and other post-Crawford] cases should be reconsidered”).
So the plurality must explain: What could support a dis-
tinction between the laboratory analysis there and the
DNA test in this case?4
As its first stab, the plurality states that the Cellmark
report was “not prepared for the primary purpose of accus-
ing a targeted individual.” Ante, at 31. Where that test
comes from is anyone’s guess. JUSTICE THOMAS rightly
shows that it derives neither from the text nor from the
——————
4 JUSTICE BREYER does not attempt to distinguish our precedents,
opting simply to adhere to “the dissenting view set forth in Melendez-
Diaz and Bullcoming.” See ante, at 8 (concurring opinion). He princi-
pally worries that under those cases, a State will have to call to the
witness stand “[s]ix to twelve or more technicians” who have worked on
a report. See ante, at 5; see also ante, at 3, 16–18. But none of our
cases—including this one—has presented the question of how many
analysts must testify about a given report. (That may suggest that in
most cases a lead analyst is readily identifiable.) The problem in the
cases—again, including this one—is that no analyst came forward to
testify. In the event that some future case presents the multiple-
technician issue, the Court can focus on “the broader ‘limits’ question”
that troubles JUSTICE BREYER, ante, at 7. But the mere existence of
that question is no reason to wrongly decide the case before us—which,
it bears repeating, involved the testimony of not twelve or six or three
or one, but zero Cellmark analysts.
Cite as: 567 U. S. ____ (2012) 19
KAGAN, J., dissenting
history of the Confrontation Clause. See ante, at 14–15
(opinion concurring in judgment). And it has no basis in
our precedents. We have previously asked whether a
statement was made for the primary purpose of establish-
ing “past events potentially relevant to later criminal
prosecution”—in other words, for the purpose of providing
evidence. Davis, 547 U. S., at 822; see also Bullcoming,
564 U. S., at ___ (slip op., at 14); Bryant, 562 U. S., at ___,
___ (slip op., at 14, 29); Melendez-Diaz, 557 U. S., at 310–
311; Crawford, 541 U. S., at 51–52. None of our cases has
ever suggested that, in addition, the statement must be
meant to accuse a previously identified individual; indeed,
in Melendez-Diaz, we rejected a related argument that
laboratory “analysts are not subject to confrontation be-
cause they are not ‘accusatory’ witnesses.” 557 U. S., at
313.
Nor does the plurality give any good reason for adopting
an “accusation” test. The plurality apparently agrees with
JUSTICE BREYER that prior to a suspect’s identification,
it will be “unlikely that a particular researcher has a
defendant-related motive to behave dishonestly.” Ante, at 12
(BREYER, J., concurring); see ante, at 31–32 (plurality
opinion). But surely the typical problem with laboratory
analyses—and the typical focus of cross-examination—has
to do with careless or incompetent work, rather than with
personal vendettas. And as to that predominant concern,
it makes not a whit of difference whether, at the time of
the laboratory test, the police already have a suspect.5
——————
5 Neither can the plurality gain any purchase from the idea that a
DNA profile is not “inherently inculpatory” because it “tends to excul-
pate all but one of the more than 7 billion people in the world today.”
Ante, at 3; see ante, at 32. All evidence shares this feature: the more
inculpatory it is of a single person, the more exculpatory it is of the rest
of the world. The one is but the flipside of the other. But no one has
ever before suggested that this logical corollary provides a reason to
ignore the Constitution’s efforts to ensure the reliability of evidence.
20 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
The plurality next attempts to invoke our precedents
holding statements nontestimonial when made “to respond
to an ‘ongoing emergency,’ ” rather than to create evidence
for trial, Bryant, 562 U. S., at ___ (slip op., at 11); here, the
plurality insists, the Cellmark report’s purpose was “to
catch a dangerous rapist who was still at large.” Ante, at
31. But that is to stretch both our “ongoing emergency”
test and the facts of this case beyond all recognition. We
have previously invoked that test to allow statements by a
woman who was being assaulted and a man who had just
been shot. In doing so, we stressed the “informal [and]
harried” nature of the statements, Bryant, 562 U. S., at
___ (slip op., at 31)—that they were made as, or “minutes”
after, id., at ___ (slip op., at 28), the events they described
“actually happen[ed],” Davis, 547 U. S., at 827 (emphasis
deleted), by “frantic” victims of criminal attacks, ibid.,
to officers trying to figure out “what had . . . occurred” and
what threats remained, Bryant, 562 U. S., at ___ (slip op.,
at 30) (internal quotation marks omitted). On their face,
the decisions have nothing to say about laboratory ana-
lysts conducting routine tests far away from a crime scene.
And this case presents a peculiarly inapt set of facts
for extending those precedents. Lambatos testified at trial
that “all reports in this case were prepared for this crimi-
nal investigation . . . [a]nd for the purpose of the eventual
litigation,” App. 82—in other words, for the purpose of
producing evidence, not enabling emergency responders.
And that testimony fits the relevant timeline. The police
did not send the swabs to Cellmark until November
2008—nine months after L. J.’s rape—and did not receive
the results for another four months. See id., at 30–34, 51–
52, 54. That is hardly the typical emergency response.
Finally, the plurality offers a host of reasons for why
reports like this one are reliable: “[T]here [i]s no prospect
of fabrication,” ante, at 31 (internal quotation marks
omitted); multiple technicians may “work on each DNA
Cite as: 567 U. S. ____ (2012) 21
KAGAN, J., dissenting
profile,” ante, at 32; and “defects in a DNA profile may
often be detected from the profile itself,” ibid. See also
ante, at 10–14 (opinion of BREYER, J.). But once again:
Been there, done that. In Melendez-Diaz, this Court re-
jected identical arguments, noting extensive documenta-
tion of “[s]erious deficiencies . . . in the forensic evidence
used in criminal trials.” 557 U. S., at 319; see supra, at 4–
5; see also Bullcoming, 564 U. S., at ___, n. 1 (slip op., at 4,
n. 1) (citing similar errors in laboratory analysis); Brief for
Public Defender Service for the District of Columbia et al.
as Amici Curiae 13 (discussing “[s]ystemic problems,” such
as sample contamination, sample switching, mislabeling,
and fraud, at “ ‘flagship’ DNA labs”). Scientific testing is
“technical,” to be sure, ante, at 1 (opinion of BREYER, J.);
but it is only as reliable as the people who perform it.
That is why a defendant may wish to ask the analyst a
variety of questions: How much experience do you have?
Have you ever made mistakes in the past? Did you test
the right sample? Use the right procedures? Contaminate
the sample in any way? Indeed, as scientific evidence
plays a larger and larger role in criminal prosecutions,
those inquiries will often be the most important in the
case.6
——————
6 Both the plurality and JUSTICE BREYER warn that if we require ana-
lysts to testify, we will encourage prosecutors to forgo DNA evidence in
favor of less reliable eyewitness testimony and so “increase the risk of
convicting the innocent.” Ante, at 13 (BREYER, J., concurring); see ante,
at 3–4 (plurality opinion). Neither opinion provides any evidence, even
by way of anecdote, for that view, and I doubt any exists. DNA evi-
dence is usually the prosecutor’s most powerful weapon, and a prosecu-
tor is unlikely to relinquish it just because he must bring the right
analyst to the stand. Consider what Lambatos told the factfinder here:
The DNA in L. J.’s vaginal swabs matched Williams’s DNA and would
match only “1 in 8.7 quadrillion black, 1 in 390 quadrillion white, or
1 in 109 quadrillion Hispanic unrelated individuals.” App. 56–57. No
eyewitness testimony could replace that evidence. I note as well that
the Innocence Network—a group particularly knowledgeable about the
22 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
And Melendez-Diaz made yet a more fundamental point
in response to claims of the über alles reliability of scien-
tific evidence: It is not up to us to decide, ex ante, what
evidence is trustworthy and what is not. See 557 U. S., at
317–318; see also Bullcoming, 564 U. S., at ___ (slip op., at
11). That is because the Confrontation Clause prescribes
its own “procedure for determining the reliability of testi-
mony in criminal trials.” Crawford, 541 U. S., at 67. That
procedure is cross-examination. And “[d]ispensing with
[it] because testimony is obviously reliable is akin to dis-
pensing with jury trial because a defendant is obviously
guilty.” Id., at 62.
So the plurality’s second basis for denying Williams’s
right of confrontation also fails. The plurality can find no
reason consistent with our precedents for treating the
Cellmark report as nontestimonial. That is because the
report is, in every conceivable respect, a statement meant
to serve as evidence in a potential criminal trial. And that
simple fact should be sufficient to resolve the question.
B
JUSTICE THOMAS’s unique method of defining testimo-
nial statements fares no better. On his view, the Con-
frontation Clause “regulates only the use of statements
bearing ‘indicia of solemnity.’ ” Ante, at 8 (quoting Davis,
547 U. S., at 836–837). And Cellmark’s report, he con-
cludes, does not qualify because it is “neither a sworn nor a
certified declaration of fact.” Ante, at 9. But JUSTICE
THOMAS’s approach grants constitutional significance to
minutia, in a way that can only undermine the Confronta-
tion Clause’s protections.
——————
kinds of evidence that produce erroneous convictions—disagrees with
the plurality’s and JUSTICE BREYER’s view. It argues here that “[c]on-
frontation of the analyst . . . is essential to permit proper adversarial
testing” and so to decrease the risk of convicting the innocent. Brief
for the Innocence Network as Amicus Curiae 3, 7.
Cite as: 567 U. S. ____ (2012) 23
KAGAN, J., dissenting
To see the point, start with precedent, because the
Court rejected this same kind of argument, as applied to
this same kind of document, at around this same time
just last year. In Bullcoming, the State asserted that
the forensic report at issue was nontestimonial because—
unlike the report in Melendez-Diaz—it was not sworn
before a notary public. We responded that applying the
Confrontation Clause only to a sworn forensic report
“would make the right to confrontation easily erasable”—
next time, the laboratory could file the selfsame report
without the oath. 564 U. S., at ___ (slip op., at 15). We
then held, as noted earlier, that “[i]n all material re-
spects,” the forensic report in Bullcoming matched the one
in Melendez-Diaz. 564 U. S., at ___ (slip op., at 15); see
supra, at 5. First, a law enforcement officer provided
evidence to a state laboratory assisting in police investiga-
tions. See 564 U. S., at ___ (slip op., at 15). Second, the
analyst tested the evidence and “prepared a certificate
concerning the result[s].” Ibid. Third, the certificate was
“formalized in a signed document . . . headed a ‘report.’ ”
Ibid. (some internal quotation marks omitted). That was
enough.
Now compare that checklist of “material” features to the
report in this case. The only differences are that Cellmark
is a private laboratory under contract with the State
(which no one thinks relevant), and that the report is not
labeled a “certificate.” That amounts to (maybe) a nickel’s
worth of difference: The similarities in form, function, and
purpose dwarf the distinctions. See supra, at 5–6. Each
report is an official and signed record of laboratory test
results, meant to establish a certain set of facts in legal
proceedings. Neither looks any more “formal” than the
other; neither is any more formal than the other. See ibid.
The variances are no more (probably less) than would be
found if you compared different law schools’ transcripts
or different companies’ cash flow statements or different
24 WILLIAMS v. ILLINOIS
KAGAN, J., dissenting
States’ birth certificates. The difference in labeling—a
“certificate” in one case, a “report of laboratory examina-
tion” in the other—is not of constitutional dimension.
Indeed, JUSTICE THOMAS’s approach, if accepted, would
turn the Confrontation Clause into a constitutional gee-
gaw—nice for show, but of little value. The prosecution
could avoid its demands by using the right kind of forms
with the right kind of language. (It would not take long to
devise the magic words and rules—principally, never call
anything a “certificate.”)7 And still worse: The new con-
ventions, precisely by making out-of-court statements less
“solem[n],” ante, at 1, would also make them less relia-
ble—and so turn the Confrontation Clause upside down.
See Crawford, 541 U. S., at 52–53, n. 3 (“We find it im-
plausible that a provision which concededly condemned
trial by sworn ex parte affidavit thought trial by unsworn
ex parte affidavit perfectly OK”). It is not surprising that
no other Member of the Court has adopted this position.
To do so, as JUSTICE THOMAS rightly says of the plurality’s
decision, would be to “diminis[h] the Confrontation
Clause’s protection” in “the very cases in which the ac-
cused should ‘enjoy the right . . . to be confronted with the
witnesses against him.’ ” Ante, at 16.
IV
Before today’s decision, a prosecutor wishing to admit
the results of forensic testing had to produce the techni-
cian responsible for the analysis. That was the result of
not one, but two decisions this Court issued in the last
three years. But that clear rule is clear no longer. The
five Justices who control the outcome of today’s case agree
——————
7 JUSTICE THOMAS asserts there is no need to worry, because “the
Confrontation Clause reaches bad-faith attempts to evade the formal-
ized process.” Ante, at 10; see ante, at 9, n. 5. I hope he is right. But
JUSTICE THOMAS provides scant guidance on how to conduct this novel
inquiry into motive.
Cite as: 567 U. S. ____ (2012) 25
KAGAN, J., dissenting
on very little. Among them, though, they can boast of two
accomplishments. First, they have approved the introduc-
tion of testimony at Williams’s trial that the Confrontation
Clause, rightly understood, clearly prohibits. Second, they
have left significant confusion in their wake. What
comes out of four Justices’ desire to limit Melendez-Diaz
and Bullcoming in whatever way possible, combined with
one Justice’s one-justice view of those holdings, is—to be
frank—who knows what. Those decisions apparently no
longer mean all that they say. Yet no one can tell in what
way or to what extent they are altered because no pro-
posed limitation commands the support of a majority.
The better course in this case would have been simply to
follow Melendez-Diaz and Bullcoming. Precedent-based
decisionmaking provides guidance to lower court judges
and predictability to litigating parties. Today’s plurality
and concurring opinions, and the uncertainty they sow,
bring into relief that judicial method’s virtues. I would
decide this case consistently with, and for the reasons
stated by, Melendez-Diaz and Bullcoming. And until a
majority of this Court reverses or confines those decisions,
I would understand them as continuing to govern, in every
particular, the admission of forensic evidence.
I respectfully dissent | Some years ago, the State of California prosecuted a man named John Kocak for rape. At a preliminary hear- ing, the State presented testimony from an analyst at the Cellmark Diagnostics Laboratory—the same facility used to generate DNA evidence in this case. The analyst had extracted DNA from a bloody sweatshirt found at the crime scene and then compared it to two control samples— one from Kocak and one from the victim. The analyst’s report identified a single match: As she explained on direct examination, the DNA found on the sweatshirt belonged to Kocak. But after undergoing cross- examination, the analyst realized she had made a mortify- ing error. She took the stand again, but this time to admit that the report listed the victim’s control sample as coming from Kocak, and Kocak’s as coming from the victim. So the DNA on the sweatshirt matched not Kocak, but the victim herself. See Tr. in No. SCD110465 (Super. Ct. San Diego Cty., Cal., Nov. 17, 1995), pp. 3–4 (“I’m a little hys- terical right now, but I think the two names should be switched”), online at http: //www.nlada.org/forensics/for_ lib/Documents/1037341561.0/JohnIvanKocak.pdf (as vis- ited June 15, 2012, and available in Clerk of Court’s case file). In trying Kocak, the State would have to look else- where for its evidence. 2 WILLIAMS v. ILLINOIS KAGAN, J., dissenting Our Constitution contains a mechanism for catching such errors—the Sixth Amendment’s Confrontation Clause. That Clause, and the Court’s recent cases inter- preting it, require that testimony against a criminal de- fendant be subject to cross-examination. And that com- mand applies with full force to forensic evidence of the kind involved in both the Kocak case and this one. In two decisions issued in the last three years, this Court held that if a prosecutor wants to introduce the results of fo- rensic testing into evidence, he must afford the defendant an opportunity to cross-examine an analyst responsible for the test. Forensic evidence is reliable only when properly produced, and the Confrontation Clause prescribes a par- ticular method for determining whether that has hap- pened. The Kocak incident illustrates how the Clause is designed to work: Once confronted, the analyst discovered and disclosed the error she had made. That error would probably not have come to light if the prosecutor had merely admitted the report into evidence or asked a third party to present its findings. Hence the genius of an 18th- century device as applied to 21st-century evidence: Cross- examination of the analyst is especially likely to reveal whether vials have been switched, samples contaminated, tests incompetently run, or results inaccurately recorded. Under our Confrontation Clause precedents, this is an open-and-shut case. The State of Illinois prosecuted Sandy Williams for rape based in part on a DNA profile created in Cellmark’s laboratory. Yet the State did not give Williams a chance to question the analyst who pro- duced that evidence. Instead, the prosecution introduced the results of Cellmark’s testing through an expert wit- ness who had no idea how they were generated. That approach—no less (perhaps more) than the confrontation- free methods of presenting forensic evidence we have formerly banned—deprived Williams of his Sixth Amend- ment right to “confron[t] the witnesses against him.” Cite as: 567 U. S. (2012) 3 KAGAN, J., dissenting The Court today disagrees, though it cannot settle on a reason why. JUSTICE ALITO, joined by three other Jus- tices, advances two theories—that the expert’s summary of the Cellmark report was not offered for its truth, and that the report is not the kind of statement triggering the Confrontation Clause’s protection. In the pages that follow, I call JUSTICE ALITO’s opinion “the plurality,” because that is the conventional term for it. But in all except its disposition, his opinion is a dissent: Five Jus- tices specifically reject every aspect of its reasoning and every paragraph of its explication. See ante, at 1 (THOMAS, J., concurring in judgment) (“I share the dis- sent’s view of the plurality’s flawed analysis”). JUSTICE THOMAS, for his part, contends that the Cellmark report is nontestimonial on a different rationale. But no other Justice joins his opinion or subscribes to the test he offers. That creates five votes to approve the admission of the Cellmark report, but not a single good explanation. The plurality’s first rationale endorses a prosecutorial dodge; its second relies on distinguishing indistinguishable foren- sic reports. JUSTICE THOMAS’s concurrence, though posit- ing an altogether different approach, suffers in the end from similar flaws. I would choose another path—to adhere to the simple rule established in our decisions, for the good reasons we have previously given. Because de- fendants like Williams have a constitutional right to con- front the witnesses against them, I respectfully dissent from the Court’s fractured decision. I Our modern Confrontation Clause doctrine began with About a quarter century earlier, we had interpreted the Clause to allow the admission of any out-of-court statement falling within a “firmly rooted hearsay exception” or carrying “particularized guarantees of trustworthiness.” Ohio v. 4 But in we concluded that our old approach was misguided. Drawing on historical research about the Clause’s purposes, we held that the prosecution may not admit “testimonial statements of a witness who [does] not appear at trial unless he [is] unavailable to testify, and the defendant had a prior opportunity for cross-examination.” 541 U. S., 3–54. That holding has two aspects. First, the Con- frontation Clause applies only to out-of-court statements that are “testimonial.” Second, where the Clause applies, it guarantees to a defendant just what its name sug- gests—the opportunity to cross-examine the person who made the statement. See A few years later, we made clear that ’s rule reaches forensic reports. In the Commonwealth introduced a laboratory’s “ ‘certificates of analysis’ ” stating that a sub- stance seized from the defendant was cocaine. at 308. We held that the certificates fell within the Clause’s “ ‘core class of testimonial statements’ ” because they had a clear “evidentiary purpose”: They were “ ‘made under circumstances which would lead an objective witness reasonably to believe that [they] would be available for use at a later trial.’ ” at 310– (quoting 541 U. S., 1–52). Accordingly, we ruled, the defendant had a right to cross-examine the analysts who had authored them. In reaching that conclusion, we rejected the Commonwealth’s argument that the Confrontation Clause should not apply because the statements resulted from “ ‘neutral scientific testing,’ ” and so were presumptively The Clause, we noted, commands that “ ‘reliability be assessed in a particular manner’ ”—through “ ‘testing in the crucible of cross- examination.’ ” (quoting 541 U. S., at 61). Further, we doubted that the testing summarized in the certificates was “as neutral or as reliable” as the Cite as: 567 U. S. (2012) 5 KAGAN, J., dissenting Commonwealth suggested. Citing chapter and verse from various studies, we concluded that “[f]orensic evidence is not uniquely immune from the risk of manipulation” and ; see And just two years later (and just one year ago), we reiterated ’s analysis when faced with a State’s attempt to evade it. In Bullcoming v. New Mexico, 564 U.S. (2011), a forensic report showed the defend- ant’s blood-alcohol concentration to exceed the legal limit for drivers. The State tried to introduce that finding through the testimony of a person who worked at the laboratory but had not performed or observed the blood test or certified its results. We held that foreclosed that tactic. The report, we stated, resembled the certificates in in “all material respects,” 564 U. S., at (slip op., at 15): Both were signed docu- ments providing the results of forensic testing designed to “ ‘prov[e] some fact’ in a criminal proceeding,” at (slip op., at 14) (quoting ). And the State’s resort to a “surrogate” witness, in place of the analyst who produced the report, did not satisfy the Confrontation Clause. Bullcoming, 564 U. S., at (slip op., at 12). Only the presence of “that particular scientist,” we reasoned, would enable Bullcoming’s counsel to ask “questions designed to reveal whether incompetence or dishonesty” had tainted the results. at (slip op., at 2, 12). Repeating the refrain of we held that “[t]he accused’s right is to be confronted with” the actual analyst, unless he is unavailable and the ac- cused “had an opportunity, pretrial, to cross-examine” him. Bullcoming, 564 U. S., at (slip op., at 2). This case is of a piece. The report at issue here shows a DNA profile produced by an analyst at Cellmark’s labora- tory, allegedly from a vaginal swab taken from a young woman, L. J., after she was raped. That report is identical to the one in Bullcoming (and ) in “all mate- 6 WILLIAMS v. ILLINOIS KAGAN, J., dissenting rial respects.” 564 U. S., at (slip op., at 15). Once again, the report was made to establish “ ‘some fact’ in a criminal proceeding”—here, the identity of L. J.’s attacker. at (slip op., at 14) (quoting 557 U. S., at 310); see infra, at 20. And once again, it details the results of forensic testing on evidence gathered by the police. Viewed side-by-side with the Bullcoming report, the Cellmark analysis has a comparable title; similarly describes the relevant samples, test methodology, and results; and likewise includes the signatures of laboratory officials. Compare Cellmark Diagnostics Report of Labor- atory Examination (Feb. 15, 2001), Lodging of Petitioner with App. in Bullcoming v. New Mexico, O. T. 2010, No. 09–10876, pp. 62–65. So under this Court’s prior analysis, the substance of the report could come into evidence only if Williams had a chance to cross-examine the responsible analyst. But that is not what happened. Instead, the prosecutor used Sandra Lambatos—a state-employed scientist who had not participated in the testing—as the conduit for this piece of evidence. Lambatos came to the stand after two other state analysts testified about forensic tests they had performed. One recounted how she had developed a DNA profile of Sandy Williams from a blood sample drawn after his arrest. And another told how he had confirmed the presence of (unidentified) semen on the vaginal swabs taken from L. J. All this was by the book: Williams had an opportunity to cross-examine both witnesses about the tests they had run. But of course, the State still needed to supply the missing link—it had to show that DNA found in the semen on L. J.’s vaginal swabs matched Williams’s DNA. To fill that gap, the prosecutor could have called the analyst from Cellmark to testify about the DNA profile she had produced from the swabs. But instead, the State called Lambatos as an expert witness and had her testify that the semen on those swabs contained Sandy Wil- Cite as: 567 U. S. (2012) 7 KAGAN, J., dissenting liams’s DNA: “Q Was there a computer match generated of the male DNA profile found in semen from the vaginal swabs of [L. J.] to a male DNA profile that had been identified as having originated from Sandy Williams? “A Yes, there was. “Q Did you compare the semen from the vaginal swabs of [L. J.] to the male DNA profile from the blood of Sandy Williams? “A Yes, I did. “Q [I]s the semen identified in the vaginal swabs of [L. J.] consistent with having originated from Sandy Williams? “A Yes.” App. 56–57. And so it was Lambatos, rather than any Cellmark em- ployee, who informed the trier of fact that the testing of L. J.’s vaginal swabs had produced a male DNA profile implicating Williams. Have we not already decided this case? Lambatos’s testimony is functionally identical to the “surrogate testi- mony” that New Mexico proffered in Bullcoming, which did nothing to cure the problem identified in Melendez- Diaz (which, for its part, straightforwardly applied our decision in ). Like the surrogate witness in Bullcoming, Lambatos “could not convey what [the actual analyst] knew or observed about the events i.e., the particular test and testing process he employed.” Bull coming, 564 U. S., at (slip op., at 12). “Nor could such 8 WILLIAMS v. ILLINOIS KAGAN, J., dissenting surrogate testimony expose any lapses or lies” on the testing analyst’s part. Like the lawyers in Melendez- Diaz and Bullcoming, Williams’s attorney could not ask questions about that analyst’s “proficiency, the care he took in performing his work, and his veracity.” 564 U. S., at n. 7 (slip op., at 12, n. 7). He could not probe whether the analyst had tested the wrong vial, inverted the labels on the samples, committed some more technical error, or simply made up the results. See App. to Brief for Public Defender Service for the District of Columbia et al. as Amici Curiae 5a, 11a (describing mistakes and fraud at Cellmark’s laboratory). Indeed, Williams’s lawyer was even more hamstrung than Bullcoming’s. At least the surrogate witness in Bullcoming worked at the relevant laboratory and was familiar with its procedures. That is not true of Lambatos: She had no knowledge at all of Cellmark’s operations. Indeed, for all the record discloses, she may never have set foot in Cellmark’s laboratory. Under our case law, that is sufficient to resolve this case. “[W]hen the State elected to introduce” the sub- stance of Cellmark’s report into evidence, the analyst who generated that report “became a witness” whom Williams “had the right to confront.” Bullcoming, 564 U. S., at (slip op., at 13). As we stated just last year, “Our prece- dent[s] cannot sensibly be read any other way.” II The plurality’s primary argument to the contrary tries to exploit a limit to the Confrontation Clause recognized in “The Clause,” we cautioned there, “does not bar the use of testimonial statements for purposes other than establishing the truth of the matter asserted.” 541 U. S., –60, n. 9 (citing 414 (1985)). The Illinois Supreme Court relied on that statement in concluding that Lambatos’s testimony was permissible. On that court’s view, “Lambatos disclosed Cite as: 567 U. S. (2012) 9 KAGAN, J., dissenting the underlying facts from Cellmark’s report” not for their truth, but “for the limited purpose of explaining the basis for her [expert] opinion,” so that the factfinder could as- sess that opinion’s value. 939 N.E. 2d 268, 282 (2010). The plurality wraps itself in that holding, similarly asserting that Lambatos’s recitation of Cellmark’s findings, when viewed through the prism of state evidence law, was not introduced to establish “the truth of any matter concerning [the] Cellmark” report. Ante, at 16; see ante, at 2, 24–25. But five Justices agree, in two opinions reciting the same reasons, that this argument has no merit: Lambatos’s statements about Cellmark’s report went to its truth, and the State could not rely on her status as an expert to circumvent the Confrontation Clause’s requirements. See ante, at 2–8 (opinion of THOMAS, J.). To see why, start with the kind of case had in mind. In acknowledging the not-for-the-truth carveout from the Clause, the Court cited as exemplary. See 541 U. S., –60, n. 9. There, claimed that his stationhouse confession of murder was a sham: A police officer, he charged, had read aloud his alleged accomplice’s confession and forced him to repeat it. To help rebut that defense, the State introduced the other confession into the record, so the jury could see how it differed from ’s. This Court rejected ’s Confrontation Clause claim because the State had offered the out-of-court statement not to prove “the truth of [the accomplice’s] assertions” about the murder, but only to disprove ’s claim of how the police elicited his con- fession. Otherwise said, the truth of the admitted statement was utterly immaterial; the only thing that mattered was that the statement (whether true or false) varied from ’s. The situation could not be more different when a wit- ness, expert or otherwise, repeats an out-of-court state- 10 WILLIAMS v. ILLINOIS KAGAN, J., dissenting ment as the basis for a conclusion, because the statement’s utility is then dependent on its truth. If the statement is true, then the conclusion based on it is probably true; if not, not. So to determine the validity of the witness’s conclusion, the factfinder must assess the truth of the out- of-court statement on which it relies. That is why the principal modern treatise on evidence variously calls the idea that such “basis evidence” comes in not for its truth, but only to help the factfinder evaluate an expert’s opin- ion “very weak,” “factually implausible,” “nonsense,” and “sheer fiction.” D. Kaye, D. Bernstein, & J. Mnookin, The New Wigmore: Expert Evidence pp. 196–197 (2d ed. 2011); at 24 (Supp. 2012). “One can sym- pathize,” notes that treatise, “with a court’s desire to permit the disclosure of basis evidence that is quite prob- ably reliable, such as a routine analysis of a drug, but to pretend that it is not being introduced for the truth of its contents strains credibility.” at 198 (2d ed. 2011); see also, e.g., 128, (“The distinction between a statement offered for its truth and a statement offered to shed light on an expert’s opinion is not meaning- ful”). Unlike in admission of the out-of-court statement in this context has no purpose separate from its truth; the factfinder can do nothing with it except assess its truth and so the credibility of the conclusion it serves to buttress.1 —————— 1 In responding to this reasoning, the plurality confirms it. According to the plurality, basis evidence supports the “credibility of the expert’s opinion” by showing that he has relied on, and drawn logical inferences from, sound “factual premises.” Ante, at 24. Quite right. And that process involves assessing such premises’ truth: If they are, as the plurality puts it, “unsupported by other evidence in the record” or otherwise baseless, they will not “allay [a factfinder’s] fears” about an “expert’s reasoning.” Ante, at 24–25. I could not have said it any better. Cite as: 567 U. S. (2012) 11 KAGAN, J., dissenting Consider a prosaic example not involving scientific ex- perts. An eyewitness tells a police officer investigating an assault that the perpetrator had an unusual, star- shaped birthmark over his left eye. The officer arrests a person bearing that birthmark (let’s call him Starr) for committing the offense. And at trial, the officer takes the stand and recounts just what the eyewitness told him. Presumably the plurality would agree that such testimony violates the Confrontation Clause unless the eyewitness is unavailable and the defendant had a prior opportunity to cross-examine him. Now ask whether anything changes if the officer couches his testimony in the following way: “I concluded that Starr was the assailant because a reliable eyewitness told me that the assailant had a star-shaped birthmark and, look, Starr has one just like that.” Surely that framing would make no constitutional difference, even though the eyewitness’s statement now explains the basis for the officer’s conclusion. It remains the case that the prosecution is attempting to introduce a testimonial statement that has no relevance to the proceedings apart from its truth—and that the defendant cannot cross- examine the person who made it. Allowing the admission of this evidence would end-run the Confrontation Clause, and make a parody of its strictures. And that example, when dressed in scientific clothing, is no different from this case. The Cellmark report identified the rapist as having a particular DNA profile (think of it as the quintessential birthmark). The Confrontation Clause prevented the State from introducing that report into evidence except by calling to the stand the person who prepared it. See –; Bullcoming, 564 U. S., at (slip op., at 2). So the State tried another route—introducing the substance of the re- port as part and parcel of an expert witness’s conclusion. In effect, Lambatos testified (like the police officer above): “I concluded that Williams was the rapist because Cell- 12 WILLIAMS v. ILLINOIS KAGAN, J., dissenting mark, an accredited and trustworthy laboratory, says that the rapist has a particular DNA profile and, look, Williams has an identical one.” And here too, that form of testimony should change nothing. The use of the Cellmark statement remained bound up with its truth, and the statement came into evidence without any oppor- tunity for Williams to cross-examine the person who made it. So if the plurality were right, the State would have a ready method to bypass the Constitution (as much as in my hypothetical case); a wink and a nod, and the Confron- tation Clause would not pose a bar to forensic evidence. The plurality tries to make plausible its not-for-the- truth rationale by rewriting Lambatos’s testimony about the Cellmark report. According to the plurality, Lambatos merely “assumed” that Cellmark’s DNA profile came from L. J.’s vaginal swabs, accepting for the sake of argument the prosecutor’s premise. Ante, at 18. But that is incor- rect. Nothing in Lambatos’s testimony indicates that she was making an assumption or considering a hypothesis. To the contrary, Lambatos affirmed, without qualification, that the Cellmark report showed a “male DNA profile found in semen from the vaginal swabs of [L. J.].” App. 56. Had she done otherwise, this case would be different. There was nothing wrong with Lambatos’s testifying that two DNA profiles—the one shown in the Cellmark report and the one derived from Williams’s blood—matched each other; that was a straightforward application of Lamba- tos’s expertise. Similarly, Lambatos could have added that if the Cellmark report resulted from scientifically sound testing of L. J.’s vaginal swab, then it would link Williams to the assault. What Lambatos could not do was what she did: indicate that the Cellmark report was pro- duced in this way by saying that L. J.’s vaginal swab contained DNA matching Williams’s.2 By testifying in —————— 2 The plurality suggests that Lambatos’s testimony is merely a mod- Cite as: 567 U. S. (2012) 13 KAGAN, J., dissenting that manner, Lambatos became just like the surrogate witness in Bullcoming—a person knowing nothing about “the particular test and testing process,” but vouching for them regardless. 564 U. S., at (slip op., at 12). We have held that the Confrontation Clause requires some- thing more. The plurality also argues that Lambatos’s characteriza- tion of the Cellmark report did not violate the Confronta- tion Clause because the case “involve[d] a bench trial.” Ante, at 19 (emphasis deleted). I welcome the plurality’s concession that the Clause might forbid presenting Lam- batos’s statement to a jury, see ante, at 18–19; it indicates that the plurality realizes that her testimony went beyond an “assumption.” But the presence of a judge does not transform the constitutional question. In applying the Confrontation Clause, we have never before considered relevant the decisionmaker’s identity. See, e.g., v. —————— ern, streamlined way of answering hypothetical questions and therefore raises no constitutional issue, see ante, at 2, 13–15; similarly, the plurality contends that the difference between what Lambatos said and what I would allow involves only “slightly revis[ing]” her testimony and so can be of no consequence, see ante, at 18, n. 3. But the statement “if X is true, then Y follows” differs materially—and constitutionally— from the statement “Y is true because X is true (according to Z).” The former statement is merely a logical proposition, whose validity the defendant can contest by questioning the speaker. And then, assum- ing the prosecutor tries to prove the statement’s premise through some other witness, the defendant can rebut that effort through cross- examination. By contrast, the latter statement as well contains a factual allegation (that X is true), which the defendant can only effec- tively challenge by confronting the person who made it (Z). That is why recognizing the difference between these two forms of testimony is not to insist on an archaism or a formality, but to ensure, in line with the Constitution, that defendants have the ability to confront their accus- ers. And if prosecutors can easily conform their conduct to that consti- tutional directive, as the plurality suggests, so much the better: I would not have thought it a ground of complaint that the Confrontation Clause, properly understood, manages to protect defendants without overly burdening the State. 14 And this case would be a poor place to begin. Lambatos’s description of the Cellmark report was offered for its truth because that is all such “basis evidence” can be offered for; as described earlier, the only way the factfinder could consider whether that statement supported her opinion (that the DNA on L. J.’s swabs came from Williams) was by assessing the statement’s truth. See at 9–12. That is so, as a simple matter of logic, whether the factfinder is a judge or a jury. And thus, in either case, admission of the state- ment, without the opportunity to cross-examine, violates the Confrontation Clause. See ante, at 3–4, n. 1 (opinion of THOMAS, J.). In saying that much, I do not doubt that a judge typi- cally will do better than a jury in excluding such inadmis- sible evidence from his decisionmaking process. Perhaps the judge did so here; perhaps, as the plurality thinks, he un- derstood that he could not consider Lambatos’s repre- sentation about the Cellmark report, and found that other, “circumstantial evidence” established “the source of the sample that Cellmark tested” and “the reliability of the Cellmark profile.” See ante, at 22–23. Some indications are to the contrary: In delivering his verdict, the judge never referred to the circumstantial evidence the plurality marshals, but instead focused only on Lambatos’s testi- mony. See 4 Record JJJ151 (calling Lambatos “the best DNA witness I have ever heard” and referring to Williams as “the guy whose DNA, according to the evidence from the experts, is in the semen recovered from the victim’s vagina”). But I take the plurality’s point that when read “[i]n context” the judge’s statements might be “best under- stood” as meaning something other than what they appear to say. See ante, at 20, n. 6. Still, that point suggests only that the admission of Lambatos’s statement was harm- less—that the judge managed to put it out of mind. After all, whether a factfinder is confused by an error is a sepa- Cite as: 567 U. S. (2012) 15 KAGAN, J., dissenting rate question from whether an error has occurred. So the plurality’s argument does not answer the only question this case presents: whether a constitutional violation happened when Lambatos recited the Cellmark report’s findings.3 At bottom, the plurality’s not-for-the-truth rationale is a simple abdication to state-law labels. Although the utility of the Cellmark statement that Lambatos repeated logi- cally depended on its truth, the plurality thinks this case decided by an Illinois rule holding that the facts underly- ing an expert’s opinion are not admitted for that purpose. See ante, at 14–18; 175– 177, But we do not typically allow state law to define federal constitutional require- ments. And needless to say (or perhaps not), the Confron- —————— 3 The plurality asserts (without citation) that I am “reach[ing] the truly remarkable conclusion that the wording of Lambatos’ testimony confused the trial judge,” ante, at 19, and then spends three pages explaining why that conclusion is wrong, see ante, at 19–21. But the plurality is responding to an argument of its own imagining, because I reach no such conclusion. As I just stated, the trial judge might well have ignored Lambatos’s statement about the Cellmark report and relied on other evidence to conclude that “the Cellmark profile was derived from the sample taken from the victim,” ante, at 19. All I am saying is that the admission of that statement violated the Confronta- tion Clause even if the judge ultimately put it aside, because it came into evidence for nothing other than its truth. See at 9–12. Similarly, the plurality claims (still without citation) that I think the other evidence about the Cellmark report insufficient, see ante, at 21. But once again, the plurality must be reading someone else’s opinion. I express no view on sufficiency of the evidence because it is irrelevant to the Confrontation Clause issue we took this case to decide. It is the plurality that wrongly links the two, spending another five pages trumpeting the strength of the Cellmark report, see ante, at 22–24, 32– 33. But the plurality cannot properly decide whether a Confrontation Clause violation occurred at Williams’s trial by determining that Williams was guilty. The American criminal justice system works the opposite way: determining guilt by holding trials in accord with consti- tutional requirements. 16 WILLIAMS v. ILLINOIS KAGAN, J., dissenting tation Clause is a constitutional rule like any other. As JUSTICE THOMAS observes, even before we did not allow the Clause’s scope to be “dictated by state or federal evidentiary rules.” See ante, at 2. Indeed, in we independently reviewed whether an out-of-court statement was introduced for its truth—the very question at issue in this case. See –416. And in we still more firmly disconnected the Confron- tation Clause inquiry from state evidence law, by overrul- ing an approach that looked in part to whether an out- of-court statement fell within a “ ‘firmly rooted hearsay exception.’ ” (quoting Roberts, 448 U. S., at ). That decision made clear that the Confrontation Clause’s protections are not coterminous with rules of evidence. So the plurality’s state-law-first approach would be an about-face. Still worse, that approach would allow prosecutors to do through subterfuge and indirection what we previously have held the Confrontation Clause prohibits. Imagine for a moment a poorly trained, incompetent, or dishonest laboratory analyst. (The analyst in Bullcoming, placed on unpaid leave for unknown reasons, might qualify.) Under our precedents, the prosecutor cannot avoid exposing that analyst to cross-examination simply by introducing his report. See 557 U. S., at Nor can the prosecutor escape that fate by offering the results through the testimony of another analyst from the laboratory. See Bullcoming, 564 U. S., at (slip op., at 2). But under the plurality’s approach, the prosecutor could choose the analyst-witness of his dreams (as the judge here said, “the best DNA witness I have ever heard”), offer her as an expert (she knows nothing about the test, but boasts im- pressive degrees), and have her provide testimony identi- cal to the best the actual tester might have given (“the DNA extracted from the vaginal swabs matched Sandy Williams’s”)—all so long as a state evidence rule says that Cite as: 567 U. S. (2012) 17 KAGAN, J., dissenting the purpose of the testimony is to enable the factfinder to assess the expert opinion’s basis. (And this tactic would not be confined to cases involving scientific evidence. As JUSTICE THOMAS points out, the prosecutor could similarly substitute experts for all kinds of people making out-of- court statements. See ante, at 7.) The plurality thus would countenance the Constitution’s circumvention. If the Confrontation Clause prevents the State from getting its evidence in through the front door, then the State could sneak it in through the back. What a neat trick—but really, what a way to run a criminal justice system. No wonder five Justices reject it. III The plurality also argues, as a “second, independent basis” for its decision, that the Cellmark report falls out- side the Confrontation Clause’s ambit because it is nontes- timonial. Ante, at 3. The plurality tries out a number of supporting theories, but all in vain: Each one either con- flicts with this Court’s precedents or misconstrues this case’s facts. JUSTICE THOMAS rejects the plurality’s views for similar reasons as I do, thus bringing to five the num- ber of Justices who repudiate the plurality’s understand- ing of what statements count as testimonial. See ante, at 1, 12–15. JUSTICE THOMAS, however, offers a rationale of his own for deciding that the Cellmark report is non- testimonial. I think his essay works no better. When all is said and done, the Cellmark report is a testimonial statement. A According to the plurality, we should declare the Cellmark report nontestimonial because “the use at trial of a DNA report prepared by a modern, accredited labora- tory ‘bears little if any resemblance to the historical prac- tices that the Confrontation Clause aimed to eliminate.’ ” Ante, at 33 (quoting Michigan v. Bryant, 562 U.S. 18 WILLIAMS v. ILLINOIS KAGAN, J., dissenting (2011) (THOMAS, J., concurring in judgment) (slip op., at 2)). But we just last year treated as testimonial a forensic report prepared by a “modern, accredited laboratory”; indeed, we declared that the report at issue “fell within the core class of testimonial statements” implicating the Confrontation Clause. Bullcoming, 564 U. S., at (slip op., at 16) (internal quotation marks omitted); see Brief for New Mexico Department of Health, Scientific Laboratory Division as Amicus Curiae in Bullcoming, O. T. 2010, No. 09–10786, p. 1 (discussing accreditation). And although the plurality is close, it is not quite ready (or able) to dispense with that decision. See ante, at 29, n. 13 (“Expe- rience might yet show that the holdings in [Bullcoming and other post-] cases should be reconsidered”). So the plurality must explain: What could support a dis- tinction between the laboratory analysis there and the DNA test in this case?4 As its first stab, the plurality states that the Cellmark report was “not prepared for the primary purpose of accus- ing a targeted individual.” Ante, at 31. Where that test comes from is anyone’s guess. JUSTICE THOMAS rightly shows that it derives neither from the text nor from the —————— 4 JUSTICE BREYER does not attempt to distinguish our precedents, opting simply to adhere to “the dissenting view set forth in Melendez- Diaz and Bullcoming.” See ante, at 8 (concurring opinion). He princi- pally worries that under those cases, a State will have to call to the witness stand “[s]ix to twelve or more technicians” who have worked on a report. See ante, ; see also ante, at 3, 16–18. But none of our cases—including this one—has presented the question of how many analysts must testify about a given report. (That may suggest that in most cases a lead analyst is readily identifiable.) The problem in the cases—again, including this one—is that no analyst came forward to testify. In the event that some future case presents the multiple- technician issue, the Court can focus on “the broader ‘limits’ question” that troubles JUSTICE BREYER, ante, at 7. But the mere existence of that question is no reason to wrongly decide the case before us—which, it bears repeating, involved the testimony of not twelve or six or three or one, but zero Cellmark analysts. Cite as: 567 U. S. (2012) 19 KAGAN, J., dissenting history of the Confrontation Clause. See ante, at 14–15 (opinion concurring in judgment). And it has no basis in our precedents. We have previously asked whether a statement was made for the primary purpose of establish- ing “past events potentially relevant to later criminal prosecution”—in other words, for the purpose of providing evidence. ; see also Bullcoming, 564 U. S., at (slip op., at 14); Bryant, 562 U. S., at (slip op., at 14, 29); – ; –52. None of our cases has ever suggested that, in addition, the statement must be meant to accuse a previously identified individual; indeed, in we rejected a related argument that laboratory “analysts are not subject to confrontation be- cause they are not ‘accusatory’ witnesses.” 557 U. S., at 313. Nor does the plurality give any good reason for adopting an “accusation” test. The plurality apparently agrees with JUSTICE BREYER that prior to a suspect’s identification, it will be “unlikely that a particular researcher has a defendant-related motive to behave dishonestly.” Ante, at 12 (BREYER, J., concurring); see ante, at 31–32 (plurality opinion). But surely the typical problem with laboratory analyses—and the typical focus of cross-examination—has to do with careless or incompetent work, rather than with personal vendettas. And as to that predominant concern, it makes not a whit of difference whether, at the time of the laboratory test, the police already have a suspect.5 —————— 5 Neither can the plurality gain any purchase from the idea that a DNA profile is not “inherently inculpatory” because it “tends to excul- pate all but one of the more than 7 billion people in the world today.” Ante, at 3; see ante, at 32. All evidence shares this feature: the more inculpatory it is of a single person, the more exculpatory it is of the rest of the world. The one is but the flipside of the other. But no one has ever before suggested that this logical corollary provides a reason to ignore the Constitution’s efforts to ensure the reliability of evidence. 20 WILLIAMS v. ILLINOIS KAGAN, J., dissenting The plurality next attempts to invoke our precedents holding statements nontestimonial when made “to respond to an ‘ongoing emergency,’ ” rather than to create evidence for trial, Bryant, 562 U. S., at (slip op., at 11); here, the plurality insists, the Cellmark report’s purpose was “to catch a dangerous rapist who was still at large.” Ante, at 31. But that is to stretch both our “ongoing emergency” test and the facts of this case beyond all recognition. We have previously invoked that test to allow statements by a woman who was being assaulted and a man who had just been shot. In doing so, we stressed the “informal [and] harried” nature of the statements, Bryant, 562 U. S., at (slip op., at 31)—that they were made as, or “minutes” after, at (slip op., at 28), the events they described “actually happen[ed],” (emphasis deleted), by “frantic” victims of criminal attacks, ib to officers trying to figure out “what had occurred” and what threats remained, Bryant, 562 U. S., at (slip op., at 30) (internal quotation marks omitted). On their face, the decisions have nothing to say about laboratory ana- lysts conducting routine tests far away from a crime scene. And this case presents a peculiarly inapt set of facts for extending those precedents. Lambatos testified at trial that “all reports in this case were prepared for this crimi- nal investigation [a]nd for the purpose of the eventual litigation,” App. 82—in other words, for the purpose of producing evidence, not enabling emergency responders. And that testimony fits the relevant timeline. The police did not send the swabs to Cellmark until November 2008—nine months after L. J.’s rape—and did not receive the results for another four months. See at 30–34, 51– 52, 54. That is hardly the typical emergency response. Finally, the plurality offers a host of reasons for why reports like this one are reliable: “[T]here [i]s no prospect of fabrication,” ante, at 31 (internal quotation marks omitted); multiple technicians may “work on each DNA Cite as: 567 U. S. (2012) 21 KAGAN, J., dissenting profile,” ante, at 32; and “defects in a DNA profile may often be detected from the profile itself,” See also ante, at 10–14 (opinion of BREYER, J.). But once again: Been there, done that. In this Court re- jected identical arguments, noting extensive documenta- tion of “[s]erious deficiencies in the forensic evidence used in criminal trials.” 557 U. S., ; see at 4– 5; see also Bullcoming, 564 U. S., at n. 1 (slip op., at 4, n. 1) (citing similar errors in laboratory analysis); Brief for Public Defender Service for the District of Columbia et al. as Amici Curiae 13 (discussing “[s]ystemic problems,” such as sample contamination, sample switching, mislabeling, and fraud, at “ ‘flagship’ DNA labs”). Scientific testing is “technical,” to be sure, ante, at 1 (opinion of BREYER, J.); but it is only as reliable as the people who perform it. That is why a defendant may wish to ask the analyst a variety of questions: How much experience do you have? Have you ever made mistakes in the past? Did you test the right sample? Use the right procedures? Contaminate the sample in any way? Indeed, as scientific evidence plays a larger and larger role in criminal prosecutions, those inquiries will often be the most important in the case.6 —————— 6 Both the plurality and JUSTICE BREYER warn that if we require ana- lysts to testify, we will encourage prosecutors to forgo DNA evidence in favor of less reliable eyewitness testimony and so “increase the risk of convicting the innocent.” Ante, at 13 (BREYER, J., concurring); see ante, at 3–4 (plurality opinion). Neither opinion provides any evidence, even by way of anecdote, for that view, and I doubt any exists. DNA evi- dence is usually the prosecutor’s most powerful weapon, and a prosecu- tor is unlikely to relinquish it just because he must bring the right analyst to the stand. Consider what Lambatos told the factfinder here: The DNA in L. J.’s vaginal swabs matched Williams’s DNA and would match only “1 in 8.7 quadrillion black, 1 in 390 quadrillion white, or 1 in 109 quadrillion Hispanic unrelated individuals.” App. 56–57. No eyewitness testimony could replace that evidence. I note as well that the Innocence Network—a group particularly knowledgeable about the 22 WILLIAMS v. ILLINOIS KAGAN, J., dissenting And made yet a more fundamental point in response to claims of the über alles reliability of scien- tific evidence: It is not up to us to decide, ex ante, what evidence is trustworthy and what is not. See 557 U. S., at 317–318; see also Bullcoming, 564 U. S., at (slip op., at 11). That is because the Confrontation Clause prescribes its own “procedure for determining the reliability of testi- mony in criminal trials.” That procedure is cross-examination. And “[d]ispensing with [it] because testimony is obviously reliable is akin to dis- pensing with jury trial because a defendant is obviously guilty.” So the plurality’s second basis for denying Williams’s right of confrontation also fails. The plurality can find no reason consistent with our precedents for treating the Cellmark report as nontestimonial. That is because the report is, in every conceivable respect, a statement meant to serve as evidence in a potential criminal trial. And that simple fact should be sufficient to resolve the question. B JUSTICE THOMAS’s unique method of defining testimo- nial statements fares no better. On his view, the Con- frontation Clause “regulates only the use of statements bearing ‘indicia of solemnity.’ ” Ante, at 8 (quoting –837). And Cellmark’s report, he con- cludes, does not qualify because it is “neither a sworn nor a certified declaration of fact.” Ante, at 9. But JUSTICE THOMAS’s approach grants constitutional significance to minutia, in a way that can only undermine the Confronta- tion Clause’s protections. —————— kinds of evidence that produce erroneous convictions—disagrees with the plurality’s and JUSTICE BREYER’s view. It argues here that “[c]on- frontation of the analyst is essential to permit proper adversarial testing” and so to decrease the risk of convicting the innocent. Brief for the Innocence Network as Amicus Curiae 3, 7. Cite as: 567 U. S. (2012) 23 KAGAN, J., dissenting To see the point, start with precedent, because the Court rejected this same kind of argument, as applied to this same kind of document, at around this same time just last year. In Bullcoming, the State asserted that the forensic report at issue was nontestimonial because— unlike the report in —it was not sworn before a notary public. We responded that applying the Confrontation Clause only to a sworn forensic report “would make the right to confrontation easily erasable”— next time, the laboratory could file the selfsame report without the oath. 564 U. S., at (slip op., at 15). We then held, as noted earlier, that “[i]n all material re- spects,” the forensic report in Bullcoming matched the one in 564 U. S., at (slip op., at 15); see First, a law enforcement officer provided evidence to a state laboratory assisting in police investiga- tions. See 564 U. S., at (slip op., at 15). Second, the analyst tested the evidence and “prepared a certificate concerning the result[s].” Third, the certificate was “formalized in a signed document headed a ‘report.’ ” That was enough. Now compare that checklist of “material” features to the report in this case. The only differences are that Cellmark is a private laboratory under contract with the State (which no one thinks relevant), and that the report is not labeled a “certificate.” That amounts to (maybe) a nickel’s worth of difference: The similarities in form, function, and purpose dwarf the distinctions. See –6. Each report is an official and signed record of laboratory test results, meant to establish a certain set of facts in legal proceedings. Neither looks any more “formal” than the other; neither is any more formal than the other. See The variances are no more (probably less) than would be found if you compared different law schools’ transcripts or different companies’ cash flow statements or different 24 WILLIAMS v. ILLINOIS KAGAN, J., dissenting States’ birth certificates. The difference in labeling—a “certificate” in one case, a “report of laboratory examina- tion” in the other—is not of constitutional dimension. Indeed, JUSTICE THOMAS’s approach, if accepted, would turn the Confrontation Clause into a constitutional gee- gaw—nice for show, but of little value. The prosecution could avoid its demands by using the right kind of forms with the right kind of language. (It would not take long to devise the magic words and rules—principally, never call anything a “certificate.”)7 And still worse: The new con- ventions, precisely by making out-of-court statements less “solem[n],” ante, at 1, would also make them less relia- ble—and so turn the Confrontation Clause upside down. See 541 U. S., 2–53, n. 3 (“We find it im- plausible that a provision which concededly condemned trial by sworn ex parte affidavit thought trial by unsworn ex parte affidavit perfectly OK”). It is not surprising that no other Member of the Court has adopted this position. To do so, as JUSTICE THOMAS rightly says of the plurality’s decision, would be to “diminis[h] the Confrontation Clause’s protection” in “the very cases in which the ac- cused should ‘enjoy the right to be confronted with the witnesses against him.’ ” Ante, at 16. IV Before today’s decision, a prosecutor wishing to admit the results of forensic testing had to produce the techni- cian responsible for the analysis. That was the result of not one, but two decisions this Court issued in the last three years. But that clear rule is clear no longer. The five Justices who control the outcome of today’s case agree —————— 7 JUSTICE THOMAS asserts there is no need to worry, because “the Confrontation Clause reaches bad-faith attempts to evade the formal- ized process.” Ante, at 10; see ante, at 9, n. 5. I hope he is right. But JUSTICE THOMAS provides scant guidance on how to conduct this novel inquiry into motive. Cite as: 567 U. S. (2012) 25 KAGAN, J., dissenting on very little. Among them, though, they can boast of two accomplishments. First, they have approved the introduc- tion of testimony at Williams’s trial that the Confrontation Clause, rightly understood, clearly prohibits. Second, they have left significant confusion in their wake. What comes out of four Justices’ desire to limit and Bullcoming in whatever way possible, combined with one Justice’s one-justice view of those holdings, is—to be frank—who knows what. Those decisions apparently no longer mean all that they say. Yet no one can tell in what way or to what extent they are altered because no pro- posed limitation commands the support of a majority. The better course in this case would have been simply to follow and Bullcoming. Precedent-based decisionmaking provides guidance to lower court judges and predictability to litigating parties. Today’s plurality and concurring opinions, and the uncertainty they sow, bring into relief that judicial method’s virtues. I would decide this case consistently with, and for the reasons stated by, and Bullcoming. And until a majority of this Court reverses or confines those decisions, I would understand them as continuing to govern, in every particular, the admission of forensic evidence. I respectfully dissent |
Justice Marshall | majority | false | Scarborough v. United States | 1977-06-06T00:00:00 | null | https://www.courtlistener.com/opinion/109672/scarborough-v-united-states/ | https://www.courtlistener.com/api/rest/v3/clusters/109672/ | 1,977 | 1976-119 | 1 | 7 | 1 | Petitioner was convicted of possessing a firearm in violation of Title VII of the Omnibus Crime Control and Safe Streets *564 Act of 1968 (Omnibus Crime Control Act), 18 U.S. C. App. §§ 1201-1203. The statute provides, in pertinent part:
"Any person who
"(1) has been convicted by a court of the United States or of a State or any political subdivision thereof of a felony . . .
.....
"and who receives, possesses, or transports in commerce or affecting commerce . . . any firearm shall be fined not more than $10,000 or imprisoned for not more than two years, or both." 18 U.S. C. App. § 1202(a).[1]
The issue in this case is whether proof that the possessed firearm previously traveled in interstate commerce is sufficient to satisfy the statutorily required nexus between the possession of a firearm by a convicted felon and commerce.
I
In 1972 petitioner pleaded guilty in the Circuit Court of Fairfax County, Va., to the felony of possession of narcotics with intent to distribute. A year later, in August 1973, law *565 enforcement officials, in the execution of a search warrant for narcotics, seized four firearms from petitioner's bedroom. Petitioner was subsequently charged with both receipt and possession of the four firearms in violation of 18 U.S. C. App. § 1202 (a) (1).
In a jury trial in the Eastern District of Virginia, the Government offered evidence to show that all of the seized weapons had traveled in interstate commerce. All the dates established for such interstate travel were prior to the date petitioner became a convicted felon.[2] The Government made no attempt to prove that the petitioner acquired these weapons after his conviction.[3] Holding such proof necessary for a receipt conviction, the judge, at the close of the Government's case, granted petitioner's motion for a judgment of acquittal on that part of the indictment charging receipt.
Petitioner's defense to the possession charge was twofold. As a matter of fact, he contended that by the time of his conviction he no longer possessed the firearms. His claim was that, to avoid violating this statute, he had transferred these guns to his wife prior to pleading guilty to the narcotics felony. Secondly, he argued that, as a matter of law, proof that the *566 guns had at some time traveled in interstate commerce did not provide an adequate nexus between the possession and commerce. In furtherance of this defense, petitioner requested that the jury be instructed as follows:
"In order for the defendant to be found guilty of the crime with which he is charged, it is incumbent upon the Government to demonstrate a nexus between the `possession' of the firearms and interstate commerce. For example, a person `possesses' in commerce or affecting commerce if at the time of the offense the firearms were moving interstate or on an interstate facility, or if the `possession' affected commerce. It is not enough that the Government merely show that the firearms at some time had travelled in interstate commerce. . . ." App. 12-13.
The judge rejected this instruction. Instead he informed the jury:
"The government may meet its burden of proving a connection between commerce and the possession of a firearm by a convicted felon if it is demonstrated that the firearm possessed by a convicted felon had previously travelled in interstate commerce.
.....
"It is not necessary that the government prove that the defendant purchased the gun in some state other than that where he was found with it or that he carried it across the state line, nor must the government prove who did purchase the gun." Id., at 14.
Petitioner was found guilty and he appealed. The Court of Appeals for the Fourth Circuit affirmed. 539 F.2d 331. It held that the interstate commerce nexus requirement of the possession offense was satisfied by proof that the firearm petitioner possessed had previously traveled in interstate commerce. *567 In view of the split among the Circuits on this issue,[4] we granted certiorari. 429 U.S. 815 (1976).[5] We affirm.
II
Our first encounter with Title VII of the Omnibus Crime Control Act came in United States v. Bass, 404 U.S. 336 (1971). There we had to decide whether the statutory phrase "in commerce or affecting commerce" in § 1202 (a) applied to "possesses" and "receives" as well as to "transports." We noted that the statute was not a model of clarity. On the one hand, we found "significant support" in the legislative history for the contention that the statute "reaches the mere possession of guns without any showing of an interstate commerce nexus" in individual cases. 404 U.S., at 345-346. On the other hand, we could not ignore Congress' inserting the phrase "in commerce or affecting commerce" in the statute. Id., at 345. The phrase clearly modified "transport" *568 and we could find no sensible explanation for requiring a nexus only for transport. Id., at 340. Faced with this ambiguity,[6] the Court adopted the narrower reading that the phrase modified all three offenses. We found this result dictated by two principles of statutory interpretation: First, that "ambiguity concerning the ambit of criminal statutes should be resolved in favor of lenity," Rewis v. United States, 401 U.S. 808, 812 (1971), and second, that "unless Congress conveys its purpose clearly, it will not be deemed to have significantly changed the federal-state balance," Bass, supra, at 349. Since "[a]bsent proof of some interstate commerce nexus in each case § 1202 (a) dramatically intrudes upon traditional state criminal jurisdiction," 404 U.S., at 350, we were unwilling to conclude, without a "clearer statement of intention," ibid., that Congress meant to dispense entirely with a nexus requirement in individual cases.
It was unnecessary in Bass for us to decide what would constitute an adequate nexus with commerce as the Government had made no attempt to show any nexus at all. While we did suggest some possibilities,[7] the present case presents the first opportunity to focus on the question with the benefit of full briefing and argument.
The Government's position is that to establish a nexus with interstate commerce it need prove only that the firearm possessed by the convicted felon traveled at some time in interstate commerce. The petitioner contends, however, that the nexus must be "contemporaneous" with the possession, that the statute proscribes "only crimes with a present connection to commerce." Brief for Petitioner 9. He suggests that at the time of the offense the possessor must be engaging *569 in commerce or must be carrying the gun at an interstate facility. Tr. of Oral Arg. 11. At oral argument he suggested an alternative theorythat one can be convicted for possession without any proof of a present connection with commerce so long as the firearm was acquired after conviction. Id., at 15.
In our effort to resolve the dispute, we turn first to the text of the statute. Petitioner contends that the meaning can be readily determined from the face of the statute, at least when it is contrasted with Title IV of the Omnibus Crime Control Act, another title dealing with gun control.[8] He points to one section of Title IV, 18 U.S. C. § 922 (h), arguing, in reliance on our decision in Barrett v. United States, 423 U.S. 212 (1976), that this section shows how Congress can, if it chooses, specify an offense based on firearms that have previously traveled in commerce. In § 922 (h), Congress employed the present perfect tense, as it prohibited a convicted felon from receiving a firearm "which has been shipped or transported in interstate or foreign commerce." This choice of tense led us to conclude in Barrett that Congress clearly "denot[ed] an act that has been completed." 423 U.S., at 216. Thus, petitioner argues, since Congress knows how to specify completed transactions, its failure to use that language in the present statute must mean that it wanted to reach only ongoing transactions.
The essential difficulty with this argument is that it is not very meaningful to compare Title VII with Title IV. See Bass, 404 U. S., at 344. Title VII was a last-minute amendment to the Omnibus Crime Control Act enacted hastily with little discussion and no hearings.[9] The statute, as we noted in *570 Bass, is not the product of model legislative deliberation or draftsmanship. Id., at 339, 344. Title IV, on the other hand, is a carefully constructed package of gun control legislation. It is obvious that the tenses used throughout Title IV were chosen with care. For example, in addition to the prohibition in § 922 (h) on receipt by convicted felons, Congress also made it illegal in § 922 (g) for such person to "ship or transport any firearm or ammunition in interstate or foreign commerce." In § 922 (j), Congress made it unlawful for "any person to receive, conceal, store, barter, sell or dispose of any stolen firearm . . . , which is moving as, which is part of, or which constitutes, interstate or foreign commerce." And § 922 (k) makes it illegal for "any person knowingly to transport, ship, or receive, in interstate or foreign commerce, any firearm which has had [its] serial number removed, obliterated or altered." In view of such fine nuances in the tenses employed in the statute, the Court could easily conclude in Barrett that "Congress knew the significance and meaning of the language it employed." 423 U.S., at 217. The language it chose was "without ambiguity." Id., at 216. "Had Congress intended to confine § 922 (h) to direct interstate receipts, it would have so provided, just as it did in other sections of [Title IV]." Id., at 217.
In the present case, by contrast, Congress' choice of language was ambiguous at best. While it is true that Congress did not choose the precise language used in § 922 (h) to indicate that a present nexus with commerce is not required, neither did it use the language of § 922 (j) to indicate that the gun must have a contemporaneous connection with commerce at the time of the offense. Thus, while petitioner is correct *571 in nothing that Congress has the skills to be precise, the fact that it did not employ those skills here helps us not at all.
While Congress' choice of tenses is not very revealing, its findings and its inclusion of the phrase "affecting commerce" are somewhat more helpful. In the findings at the beginning of Title VII, Congress expressly declared that "the receipt, possession, or transportation of a firearm by felons . . . constitutes. . . a burden on commerce or threat affecting the free flow of commerce," 18 U.S. C. App. § 1201 (1).[10] It then implemented those findings by prohibiting possessions "in commerce and affecting commerce." As we have previously observed, Congress is aware of the "distinction between legislation limited to activities `in commerce' and an assertion of its full Commerce Clause power so as to cover all activity substantially affecting interstate commerce." United States v. American Bldg. Maintenance Industries, 422 U.S. 271, 280 (1975); see also NLRB v. Reliance Fuel Corp., 371 U.S. 224, 226 (1963). Indeed, that awareness was explicitly demonstrated here. In arguing that Congress could, *572 consistent with the Constitution, "outlaw the mere possession of weapons," Senator Long, in introducing Title VII, pointed to the fact that "many of the items and transactions reached by the broad swath of the Civil Rights Act of 1964 were reached by virtue of the power of Congress to regulate matters affecting commerce, not just to regulate interstate commerce itself." 114 Cong. Rec. 13868 (1968). He advised a similar reliance on the power to regulate matters affecting commerce and urged that "Congress simply [find] that the possession of these weapons by the wrong kind of people is either a burden on commerce or a threat that affects the free flow of commerce." Id., at 13869. While in Bass we noted that we could not be sure that Congress meant to do away entirely with a nexus requirement, it does seem apparent that in implementing these findings by prohibiting both possessions in commerce and those affecting commerce, Congress must have meant more than to outlaw simply those possessions that occur in commerce or in interstate facilities. And we see no basis for contending that a weapon acquired after a conviction affects commerce differently from one acquired before and retained.
The legislative history in its entirety, while brief, further supports the view that Congress sought to rule broadlyto keep guns out of the hands of those who have demonstrated that "they may not be trusted to possess a firearm without becoming a threat to society." Id., at 14773. There is simply no indication of any concern with either the movement of the gun or the possessor or with the time of acquisition.
In introducing the amendment, Senator Long stated:
"I have prepared an amendment which I will offer at an appropriate time, simply setting forth the fact that anybody who has been convicted of a felony . . . is not permitted to possess a firearm . . . .
"It might be well to analyze, for a moment, the logic involved. When a man has been convicted of a felony, *573 unlessas this bill sets forthhe has been expressly pardoned by the President and the pardon states that the person is to be permitted to possess firearms in the future, that man would have no right to possess firearms. He would be punished criminally if he is found in possession of them.
.....
"It seems to me that this simply strikes at the possession of firearms by the wrong kind of people. It avoids the problem of imposing on an honest hardware store owner the burden of keeping a lot of records and trying to keep up with the ultimate disposition of weapons sold. It places the burden and the punishment on the kind of people who have no business possessing firearms in the event they come into possession of them." Id., at 13868-13869.
The purpose of the amendment was to complement Title IV. Id., at 14774; see also id., at 16286. Senator Long noted:
"Of all the gun bills that have been suggested, debated, discussed and considered, none except this Title VII attempts to bar possession of a firearm from persons whose prior behaviors have established their violent tendencies. . . .
". . . Under Title VII, every citizen could possess a gun until the commission of his first felony. Upon his conviction, however, Title VII would deny every assassin, murderer, thief and burglar of [sic] the right to possess a firearm in the future . . . .
.....
"Despite all that has been said about the need for controlling firearms in this Country, no other amendment heretofore offered would get at the Oswalds or the Galts. They are the types of people at which Title VII is aimed." Id., at 14773-14774.
*574 He proposed this amendment to remedy what he thought was an erroneous conception of the drafters of Title IV that there was "a constitutional doubt that the Federal Government could outlaw the mere possession of weapons." Id., at 13868.
The intent to outlaw possession without regard to movement and to apply it to a case such as petitioner's could not have been more clearly revealed than in a colloquy between Senators Long and McClellan:
"Mr. McClellan. I have not had an opportunity to study the amendment. . . . The thought that occurred to me, as the Senator explained it, is that if a man had been in the penitentiary, had been a felon, and had been pardoned, without any condition in his pardon to which the able Senator referred, granting him the right to bear arms, could that man own a shotgun for the purpose of hunting?
"Mr. Long of Louisiana. No, he could not. He could own it, but he could not possess it.
"Mr. McClellan. I beg the Senator's pardon?
"Mr. Long of Louisiana. This amendment does not seek to do anything about who owns a firearm. He could not carry it around; he could not have it.
"Mr. McClellan. Could he have it in his home?
"Mr. Long of Louisiana. No, he could not." Id., at 14774 (emphasis added).
It was after this colloquy that Senator McClellan suggested that the amendment be taken to conference for "further thought." Ibid. While that appeared to be its destination, the House, after Senate passage of the bill, defeated a motion to go to conference and adopted the entire Senate bill, including Title VII, without alteration. Id., at 16077-16078, 16299-16300. Title VII thus became law without modification.
*575 It seems apparent from the foregoing that the purpose of Title VII was to proscribe mere possession but that there was some concern about the constitutionality of such a statute. It was that observed ambivalence that made us unwilling in Bass to find the clear intent necessary to conclude that Congress meant to dispense with a nexus requirement entirely. However, we see no indication that Congress intended to require any more than the minimal nexus that the firearm have been, at some time, in interstate commerce.[11] In particular, we find no support for petitioner's theories.
Initially, we note our difficulty in fully comprehending petitioner's conception of a nexus with commerce. In his view, if an individual purchases a gun before his conviction, the fact that the gun once traveled in commerce does not provide an adequate nexus. It is necessary, in addition, that the person also carry it in an interstate facility. If, however, one purchases the same gun from the same dealer one day after the conviction as opposed to one day before, somehow the nexus magically appears, regardless of whether the purchaser carries the gun in any particular place. Such an interpretation strains credulity. We find no evidence in either the language or the legislative history for such a construction.[12]
*576 More significantly, these theories create serious loopholes in the congressional plan to "make it unlawful for a firearm . . . to be in the possession of a convicted felon." 114 Cong. Rec. 14773 (1968). A person who obtained a firearm prior to his conviction can retain it forever so long as he is not caught with it in an interstate facility. Indeed, petitioner's interpretation allows an individual to go out in the period between his arrest and conviction and purchase and stockpile weapons with impunity. In addition, petitioner's theories would significantly impede enforcement efforts. Those who do acquire guns after their conviction obviously do so surreptitiously and, as petitioner concedes, Tr. of Oral Arg. 19, it is very difficult as a practical matter to prove that such possession began after the possessor's felony conviction.
Petitioner responds that the Government's reading of the statute fails to give effect to all three terms of the statute receive, possess, transport. He argues that someone guilty of receipt or transport will necessarily be guilty of possession and that, therefore, there was no need to include the other two offenses in the statute. While this contention is not frivolous,[13] the fact is that petitioner's theory is similarly vulnerable. By his proposed definitions, there are essentially only two crimesreceipt and transport. The possessor who acquires the weapon after his conviction is guilty of receipt and the one who is carrying the gun in commerce or at an interstate *577 facility presumably is guilty of transporting.[14] Thus, the definitions offered by both sides fail to give real substance to all three terms. The difference, however, is that the Government's definition captures the essence of Congress' intent, striking at the possession of weapons by people "who have no business possessing [them]." 114 Cong. Rec. 13869 (1968). Petitioner's version, on the other hand, fails completely to fulfill the congressional purpose. It virtually eliminates the one offense on which Congress focused in enacting the law.
Finally, petitioner seeks to invoke the two principles of statutory construction relied on in Basslenity in construing criminal statutes and caution where the federal-state balance is implicated. Petitioner, however, overlooks the fact that we did not turn to these guides in Bass until we had concluded that "[a]fter `seizing every thing from which aid can be derived,' . . . we are left with an ambiguous statute." 404 U.S., at 347. The principles are applicable only when we are uncertain about the statute's meaning and are not to be used "in complete disregard of the purpose of the legislature." United States v. Bramblett, 348 U.S. 503, 510 (1955). Here, the intent of Congress is clear. We do not face the conflicting pull between the text and the history that confronted us in Bass. In this case, the history is unambiguous and the text consistent with it. Congress sought to reach possessions broadly, with little concern for when the nexus with commerce occurred. Indeed, it was a close question in Bass whether § 1202 (a) even required proof of any nexus at all in individual cases. The only reason we concluded it did was because it was not "plainly and unmistakably" clear that it did not. 404 U.S., at 348. But there is no question that Congress intended no more than a minimal nexus requirement.
*578 Since the District Court and the Court of Appeals employed the proper standard, we affirm the conviction of petitioner.
It is so ordered.
MR. JUSTICE REHNQUIST took no part in the consideration or decision of this case.
MR. | Petitioner was convicted of possessing a firearm in violation of Title VII of the Omnibus Crime Control and Safe Streets *564 Act of 1968 (Omnibus Crime Control Act), 18 U.S. C. App. 1201-1203. The statute provides, in pertinent part: "Any person who "(1) has been convicted by a court of the United States or of a State or any political subdivision thereof of a felony "and who receives, possesses, or transports in commerce or affecting commerce any firearm shall be fined not more than $10,000 or imprisoned for not more than two years, or both." 18 U.S. C. App. 1202(a).[1] The issue in this case is whether proof that the possessed firearm previously traveled in interstate commerce is sufficient to satisfy the statutorily required nexus between the possession of a firearm by a convicted felon and commerce. I In 1972 petitioner pleaded guilty in the Circuit Court of Fairfax County, Va., to the felony of possession of narcotics with intent to distribute. A year later, in August 1973, law *565 enforcement officials, in the execution of a search warrant for narcotics, seized four firearms from petitioner's bedroom. Petitioner was subsequently charged with both receipt and possession of the four firearms in violation of 18 U.S. C. App. 1202 (a) (1). In a jury trial in the Eastern District of Virginia, the Government offered evidence to show that all of the seized weapons had traveled in interstate commerce. All the dates established for such interstate travel were prior to the date petitioner became a convicted felon.[2] The Government made no attempt to prove that the petitioner acquired these weapons after his conviction.[3] Holding such proof necessary for a receipt conviction, the judge, at the close of the Government's case, granted petitioner's motion for a judgment of acquittal on that part of the indictment charging receipt. Petitioner's defense to the possession charge was twofold. As a matter of fact, he contended that by the time of his conviction he no longer possessed the firearms. His claim was that, to avoid violating this statute, he had transferred these guns to his wife prior to pleading guilty to the narcotics felony. Secondly, he argued that, as a matter of law, proof that the *566 guns had at some time traveled in interstate commerce did not provide an adequate nexus between the possession and commerce. In furtherance of this defense, petitioner requested that the jury be instructed as follows: "In order for the defendant to be found guilty of the crime with which he is charged, it is incumbent upon the Government to demonstrate a nexus between the `possession' of the firearms and interstate commerce. For example, a person `possesses' in commerce or affecting commerce if at the time of the offense the firearms were moving interstate or on an interstate facility, or if the `possession' affected commerce. It is not enough that the Government merely show that the firearms at some time had travelled in interstate commerce." App. 12-13. The judge rejected this instruction. Instead he informed the jury: "The government may meet its burden of proving a connection between commerce and the possession of a firearm by a convicted felon if it is demonstrated that the firearm possessed by a convicted felon had previously travelled in interstate commerce. "It is not necessary that the government prove that the defendant purchased the gun in some state other than that where he was found with it or that he carried it across the state line, nor must the government prove who did purchase the gun." Petitioner was found guilty and he appealed. The Court of Appeals for the Fourth Circuit affirmed.[5] We affirm. II Our first encounter with Title VII of the Omnibus Crime Control Act came in United There we had to decide whether the statutory phrase "in commerce or affecting commerce" in 1202 (a) applied to "possesses" and "receives" as well as to "transports." We noted that the statute was not a model of clarity. On the one hand, we found "significant support" in the legislative history for the contention that the statute "reaches the mere possession of guns without any showing of an interstate commerce nexus" in individual cases. -346. On the other hand, we could not ignore Congress' inserting the phrase "in commerce or affecting commerce" in the statute. The phrase clearly modified "transport" *568 and we could find no sensible explanation for requiring a nexus only for transport. Faced with this ambiguity,[6] the Court adopted the narrower reading that the phrase modified all three offenses. We found this result dictated by two principles of statutory interpretation: First, that "ambiguity concerning the ambit of criminal statutes should be resolved in favor of lenity," and second, that "unless Congress conveys its purpose clearly, it will not be deemed to have significantly changed the federal-state balance," Since "[a]bsent proof of some interstate commerce nexus in each case 1202 (a) dramatically intrudes upon traditional state criminal jurisdiction," we were unwilling to conclude, without a "clearer statement of intention," ib that Congress meant to dispense entirely with a nexus requirement in individual cases. It was unnecessary in for us to decide what would constitute an adequate nexus with commerce as the Government had made no attempt to show any nexus at all. While we did suggest some possibilities,[7] the present case presents the first opportunity to focus on the question with the benefit of full briefing and argument. The Government's position is that to establish a nexus with interstate commerce it need prove only that the firearm possessed by the convicted felon traveled at some time in interstate commerce. The petitioner contends, however, that the nexus must be "contemporaneous" with the possession, that the statute proscribes "only crimes with a present connection to commerce." Brief for Petitioner 9. He suggests that at the time of the offense the possessor must be engaging *569 in commerce or must be carrying the gun at an interstate facility. Tr. of Oral Arg. 11. At oral argument he suggested an alternative theorythat one can be convicted for possession without any proof of a present connection with commerce so long as the firearm was acquired after conviction. In our effort to resolve the dispute, we turn first to the text of the statute. Petitioner contends that the meaning can be readily determined from the face of the statute, at least when it is contrasted with Title IV of the Omnibus Crime Control Act, another title dealing with gun control.[8] He points to one section of Title IV, 18 U.S. C. 922 (h), arguing, in reliance on our decision in that this section shows how Congress can, if it chooses, specify an offense based on firearms that have previously traveled in commerce. In 922 (h), Congress employed the present perfect tense, as it prohibited a convicted felon from receiving a firearm "which has been shipped or transported in interstate or foreign commerce." This choice of tense led us to conclude in Barrett that Congress clearly "denot[ed] an act that has been completed." Thus, petitioner argues, since Congress knows how to specify completed transactions, its failure to use that language in the present statute must mean that it wanted to reach only ongoing transactions. The essential difficulty with this argument is that it is not very meaningful to compare Title VII with Title IV. See Title VII was a last-minute amendment to the Omnibus Crime Control Act enacted hastily with little discussion and no hearings.[9] The statute, as we noted in *570 is not the product of model legislative deliberation or draftsmanship. Title IV, on the other hand, is a carefully constructed package of gun control legislation. It is obvious that the tenses used throughout Title IV were chosen with care. For example, in addition to the prohibition in 922 (h) on receipt by convicted felons, Congress also made it illegal in 922 (g) for such person to "ship or transport any firearm or ammunition in interstate or foreign commerce." In 922 (j), Congress made it unlawful for "any person to receive, conceal, store, barter, sell or dispose of any stolen firearm which is moving as, which is part of, or which constitutes, interstate or foreign commerce." And 922 (k) makes it illegal for "any person knowingly to transport, ship, or receive, in interstate or foreign commerce, any firearm which has had [its] serial number removed, obliterated or altered." In view of such fine nuances in the tenses employed in the statute, the Court could easily conclude in Barrett that "Congress knew the significance and meaning of the language it employed." The language it chose was "without ambiguity." "Had Congress intended to confine 922 (h) to direct interstate receipts, it would have so provided, just as it did in other sections of [Title IV]." In the present case, by contrast, Congress' choice of language was ambiguous at best. While it is true that Congress did not choose the precise language used in 922 (h) to indicate that a present nexus with commerce is not required, neither did it use the language of 922 (j) to indicate that the gun must have a contemporaneous connection with commerce at the time of the offense. Thus, while petitioner is correct *571 in nothing that Congress has the skills to be precise, the fact that it did not employ those skills here helps us not at all. While Congress' choice of tenses is not very revealing, its findings and its inclusion of the phrase "affecting commerce" are somewhat more helpful. In the findings at the beginning of Title VII, Congress expressly declared that "the receipt, possession, or transportation of a firearm by felons constitutes. a burden on commerce or threat affecting the free flow of commerce," 18 U.S. C. App. 1201 (1).[10] It then implemented those findings by prohibiting possessions "in commerce and affecting commerce." As we have previously observed, Congress is aware of the "distinction between legislation limited to activities `in commerce' and an assertion of its full Commerce Clause power so as to cover all activity substantially affecting interstate commerce." United ; see also Indeed, that awareness was explicitly demonstrated here. In arguing that Congress could, *572 consistent with the Constitution, "outlaw the mere possession of weapons," Senator Long, in introducing Title VII, pointed to the fact that "many of the items and transactions reached by the broad swath of the Civil Rights Act of 1964 were reached by virtue of the power of Congress to regulate matters affecting commerce, not just to regulate interstate commerce itself." 114 Cong. Rec. 13868 (1968). He advised a similar reliance on the power to regulate matters affecting commerce and urged that "Congress simply [find] that the possession of these weapons by the wrong kind of people is either a burden on commerce or a threat that affects the free flow of commerce." While in we noted that we could not be sure that Congress meant to do away entirely with a nexus requirement, it does seem apparent that in implementing these findings by prohibiting both possessions in commerce and those affecting commerce, Congress must have meant more than to outlaw simply those possessions that occur in commerce or in interstate facilities. And we see no basis for contending that a weapon acquired after a conviction affects commerce differently from one acquired before and retained. The legislative history in its entirety, while brief, further supports the view that Congress sought to rule broadlyto keep guns out of the hands of those who have demonstrated that "they may not be trusted to possess a firearm without becoming a threat to society." 773. There is simply no indication of any concern with either the movement of the gun or the possessor or with the time of acquisition. In introducing the amendment, Senator Long stated: "I have prepared an amendment which I will offer at an appropriate time, simply setting forth the fact that anybody who has been convicted of a felony is not permitted to possess a firearm "It might be well to analyze, for a moment, the logic involved. When a man has been convicted of a felony, *573 unlessas this bill sets forthhe has been expressly pardoned by the President and the pardon states that the person is to be permitted to possess firearms in the future, that man would have no right to possess firearms. He would be punished criminally if he is found in possession of them. "It seems to me that this simply strikes at the possession of firearms by the wrong kind of people. It avoids the problem of imposing on an honest hardware store owner the burden of keeping a lot of records and trying to keep up with the ultimate disposition of weapons sold. It places the burden and the punishment on the kind of people who have no business possessing firearms in the event they come into possession of them." The purpose of the amendment was to complement Title IV. 774; see also Senator Long noted: "Of all the gun bills that have been suggested, debated, discussed and considered, none except this Title VII attempts to bar possession of a firearm from persons whose prior behaviors have established their violent tendencies. ". Under Title VII, every citizen could possess a gun until the commission of his first felony. Upon his conviction, however, Title VII would deny every assassin, murderer, thief and burglar of [sic] the right to possess a firearm in the future "Despite all that has been said about the need for controlling firearms in this Country, no other amendment heretofore offered would get at the Oswalds or the Galts. They are the types of people at which Title VII is aimed." 773-14774. *574 He proposed this amendment to remedy what he thought was an erroneous conception of the drafters of Title IV that there was "a constitutional doubt that the Federal Government could outlaw the mere possession of weapons." The intent to outlaw possession without regard to movement and to apply it to a case such as petitioner's could not have been more clearly revealed than in a colloquy between Senators Long and McClellan: "Mr. McClellan. I have not had an opportunity to study the amendment. The thought that occurred to me, as the Senator explained it, is that if a man had been in the penitentiary, had been a felon, and had been pardoned, without any condition in his pardon to which the able Senator referred, granting him the right to bear arms, could that man own a shotgun for the purpose of hunting? "Mr. Long of Louisiana. No, he could He could own it, but he could not possess it. "Mr. McClellan. I beg the Senator's pardon? "Mr. Long of Louisiana. This amendment does not seek to do anything about who owns a firearm. He could not carry it around; he could not have it. "Mr. McClellan. Could he have it in his home? "Mr. Long of Louisiana. No, he could " 774 It was after this colloquy that Senator McClellan suggested that the amendment be taken to conference for "further thought." While that appeared to be its destination, the House, after Senate passage of the bill, defeated a motion to go to conference and adopted the entire Senate bill, including Title VII, without alteration. Title VII thus became law without modification. *575 It seems apparent from the foregoing that the purpose of Title VII was to proscribe mere possession but that there was some concern about the constitutionality of such a statute. It was that observed ambivalence that made us unwilling in to find the clear intent necessary to conclude that Congress meant to dispense with a nexus requirement entirely. However, we see no indication that Congress intended to require any more than the minimal nexus that the firearm have been, at some time, in interstate commerce.[11] In particular, we find no support for petitioner's theories. Initially, we note our difficulty in fully comprehending petitioner's conception of a nexus with commerce. In his view, if an individual purchases a gun before his conviction, the fact that the gun once traveled in commerce does not provide an adequate nexus. It is necessary, in addition, that the person also carry it in an interstate facility. If, however, one purchases the same gun from the same dealer one day after the conviction as opposed to one day before, somehow the nexus magically appears, regardless of whether the purchaser carries the gun in any particular place. Such an interpretation strains credulity. We find no evidence in either the language or the legislative history for such a construction.[12] *576 More significantly, these theories create serious loopholes in the congressional plan to "make it unlawful for a firearm to be in the possession of a convicted felon." 114 Cong. Rec. 14773 (1968). A person who obtained a firearm prior to his conviction can retain it forever so long as he is not caught with it in an interstate facility. Indeed, petitioner's interpretation allows an individual to go out in the period between his arrest and conviction and purchase and stockpile weapons with impunity. In addition, petitioner's theories would significantly impede enforcement efforts. Those who do acquire guns after their conviction obviously do so surreptitiously and, as petitioner concedes, Tr. of Oral Arg. 19, it is very difficult as a practical matter to prove that such possession began after the possessor's felony conviction. Petitioner responds that the Government's reading of the statute fails to give effect to all three terms of the statute receive, possess, transport. He argues that someone guilty of receipt or transport will necessarily be guilty of possession and that, therefore, there was no need to include the other two offenses in the statute. While this contention is not frivolous,[13] the fact is that petitioner's theory is similarly vulnerable. By his proposed definitions, there are essentially only two crimesreceipt and transport. The possessor who acquires the weapon after his conviction is guilty of receipt and the one who is carrying the gun in commerce or at an interstate *577 facility presumably is guilty of transporting.[14] Thus, the definitions offered by both sides fail to give real substance to all three terms. The difference, however, is that the Government's definition captures the essence of Congress' intent, striking at the possession of weapons by people "who have no business possessing [them]." 114 Cong. Rec. 13869 (1968). Petitioner's version, on the other hand, fails completely to fulfill the congressional purpose. It virtually eliminates the one offense on which Congress focused in enacting the law. Finally, petitioner seeks to invoke the two principles of statutory construction relied on in lenity in construing criminal statutes and caution where the federal-state balance is implicated. Petitioner, however, overlooks the fact that we did not turn to these guides in until we had concluded that "[a]fter `seizing every thing from which aid can be derived,' we are left with an ambiguous statute." The principles are applicable only when we are uncertain about the statute's meaning and are not to be used "in complete disregard of the purpose of the legislature." United Here, the intent of Congress is clear. We do not face the conflicting pull between the text and the history that confronted us in In this case, the history is unambiguous and the text consistent with it. Congress sought to reach possessions broadly, with little concern for when the nexus with commerce occurred. Indeed, it was a close question in whether 1202 (a) even required proof of any nexus at all in individual cases. The only reason we concluded it did was because it was not "plainly and unmistakably" clear that it did But there is no question that Congress intended no more than a minimal nexus requirement. *578 Since the District Court and the Court of Appeals employed the proper standard, we affirm the conviction of petitioner. It is so ordered. MR. JUSTICE REHNQUIST took no part in the consideration or decision of this case. MR. |
Justice Blackmun | majority | false | United States v. Bishop | 1973-05-29T00:00:00 | null | https://www.courtlistener.com/opinion/108803/united-states-v-bishop/ | https://www.courtlistener.com/api/rest/v3/clusters/108803/ | 1,973 | 1972-130 | 1 | 8 | 1 | Chapter 75, subchapter A, of the Internal Revenue Code of 1954, as amended, 26 U.S. C. §§ 7201-7241, is concerned with tax crimes. Sections 7201-7207, inclusive, which in the aggregate relate to attempts to evade or defeat tax, to failures to act, and to fraud, all include the word "willfully" in their respective contexts. Specifically, § 7206 is a felony statute and reads:
"§ 7206. Fraud and false statements.
"Any person who
"(1) Declaration under penalties of perjury.
"Willfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter . . . .
.....
"shall be guilty of a felony and, upon conviction thereof, shall be fined not more than $5,000, or imprisoned not more than 3 years, or both, together with the costs of prosecution."
Section 7207 is a misdemeanor statuteC[1] and reads:
"7207. Fraudulent returns, statements, or other documents.
*348 "Any person who willfully delivers or discloses to the Secretary or his delegate any list, return, account, statement, or other document, known by him to be fraudulent or to be false as to any material matter, shall be fined not more than $1,000, or imprisoned not more than 1 year, or both."
This case presents the issue of the meaning of the critical word "willfully" as it is employed in these two successive statutes. Is its meaning the same in each, or is the willfulness specified by the misdemeanor statute, § 7207, of somewhat less degree than the felony willfulness specified by § 7206?
I
Respondent, Cecil J. Bishop, was convicted by a jury on all three counts of an indictment charging him with felony violations of § 7206 (1) with respect to his federal income tax returns for the calendar years 1963, 1964, and 1965. The Court of Appeals, holding that a lesser-included-offense instruction directed to the misdemeanor statute, § 7207, was improperly refused by the trial judge, reversed the judgment of the District Court and remanded the case for a new trial. 455 F.2d 612 (CA9 1972). Since the meaning of "willfully," as used in the tax crime statutes, has divided the circuits,[2] we granted certiorari. 409 U.S. 841 (1972).
*349 We conclude that it was proper and correct for the District Court to refuse the lesser-included-offense instruction. In our view, the word "willfully" has the same meaning in both statutes. Consequently, we reverse and remand so that the Court of Appeals may now proceed to consider the additional issues that court found it unnecessary to reach.
II
Mr. Bishop is a lawyer who has practiced his profession in Sacramento, California, since 1951. During that period, he owned an interest in a walnut ranch he and his father operated. In 1960 his secretary, Louise, married his father. The father died, and thereafter respondent's stepmother managed the ranch.
Respondent periodically sent checks to Louise. These were used to run the ranch, to pay principal on loans, and to make improvements.
Louise maintained a record of ranch of expenditures and submitted an itemized list of these disbursements to respondent at the end of each calendar year. In his 1963 return respondent asserted as business deductions all amounts paid to Louise and, in addition, all the expenses Louise listed. This necessarily resulted in a double deduction for all ranch expenditures in 1963. Moreover, some of these expenditures were for repayment of loans and for other personal items that did not qualify as income tax deductions. In his 1964 and 1965 returns respondent similarly included nondeductible amounts among the ranch figures that were deducted.
The aggregate amount of improper deductions taken by respondent for the three taxable years exceeded *350 $45,000. He enjoyed aggregate gross income for those years of about $70,000.
The incorrectness of the returns as filed for the three years was not disputed at trial. Transcript of Trial 869-872, 1148. Neither is it disputed here. Brief for Respondent 4.
III
Section 7206 (1), the felony statute, is violated when one "[w]illfully makes and subscribes any return," under penalties of perjury, "which he does not believe to be true and correct as to every material matter." Respondent based his defense at trial on the ground that he was not aware of the double deductions asserted in 1963 or of the improper deductions taken in the three taxable years. He claimed that his law office secretary prepared the return schedules from his records and from the information furnished by Louise; he merely failed to check the returns for accuracy.
Respondent requested lesser-included-offense instructions based on the misdemeanor statute, § 7207. This tax misdemeanor is committed by one "who willfully delivers or discloses" to the Internal Revenue Service any return or document "known by him to be fraudulent or to be false as to any material matter." Respondent argued that the word "willfully" in the misdemeanor statute should be construed to require less scienter than the same word in the felony statute. App. 28. With the state of respondent's guilty knowledge in dispute, his proposed instructions would have allowed the jury to choose between a misdemeanor based on caprice or careless disregard and a felony requiring evil purpose. The trial judge declined to give the requested instructions and, instead, gave an instruction only on the felony, requiring a finding by the jury that the defendant intended *351 "with evil motive or bad purpose either to disobey or to disregard the law." App. 24.
After the guilty verdict on all counts was returned, respondent was sentenced to two years' imprisonment on each count, the sentences to run concurrently. The court, however, suspended all but 90 days of each sentence and placed respondent on probation for five years on condition that he pay a fine of $5,000. App. 31.
IV
The Court of Appeals relied upon and followed, 455 F.2d, at 614, a series of its own cases,[3] particularly Abdul v. United States, 254 F.2d 292 (1958), enunciating the proposition that the word "willfully" has a meaning in tax felony statutes that is more stringent than its meaning in tax misdemeanor statutes.[4] Our examination of these Ninth Circuit precedents in the light of this Court's decisions leads us to conclude that the Court of Appeals' opinion cannot be sustained by this asserted distinction between § 7206 (1) and § 7207.
A. The Ninth Circuit rule appears to have been evolved from language in this Court's opinion in Spies v. United States, 317 U.S. 492 (1943). In Spies the defendant requested an instruction to the effect that an affirmative act was necessary to constitute a willful attempt to evade or defeat a tax, within the meaning of § 145 (b) of the Revenue Act of 1936, 49 Stat. 1703. The trial court *352 refused the request. The Second Circuit affirmed. This Court reversed. We were concerned in Spies with a felony statute, § 145 (b), applying to one "who willfully attempts in any manner to evade or defeat any tax," and with a companion misdemeanor statute, § 145 (a), applying to one who "willfully fails to pay such tax, make such return, keep such records, or supply such information, at the time or times required by law or regulations." These statutes were the predecessors of the current §§ 7201 and 7203, respectively, of the 1954 Code. In distinguishing between the two offenses, the Court said:
"The difference between willful failure to pay a tax when due, which is made a misdemeanor, and willful attempt to defeat and evade one, which is made a felony, is not easy to detect or define. Both must be willful, and willful, as we have said, is a word of many meanings, its construction often being influenced by its context. United States v. Murdock, 290 U.S. 389. It may well mean something more as applied to nonpayment of a tax than when applied to failure to make a return. Mere voluntary and purposeful, as distinguished from accidental, omission to make a timely return might meet the test of willfulness. But in view of our traditional aversion to imprisonment for debt, we would not without the clearest manifestation of Congressional intent assume that mere knowing and intentional default in payment of a tax, where there had been no willful failure to disclose the liability, is intended to constitute a criminal offense of any degree. We would expect willfulness in such a case to include some element of evil motive and want of justification in view of all the financial circumstances of the taxpayer.
"Had § 145 (a) not included willful failure to pay a tax, it would have defined as misdemeanors generally *353 a failure to observe statutory duties to make timely returns, keep records, or supply information duties imposed to facilitate administration of the Act even if, because of insufficient net income, there were no duty to pay a tax. It would then be a permissible and perhaps an appropriate construction of § 145 (b) that it made felonies of the same willful omissions when there was the added element of duty to pay a tax. The definition of such nonpayment as a misdemeanor, we think, argues strongly against such an interpretation." 317 U.S., at 497-498.
In Abdul the court considered an appeal by a taxpayer convicted of tax misdemeanors (§ 2707 (b) of the 1939 Code and § 7203 of the 1954 Code) based on failure to file but acquitted of tax felonies (§ 2707 (c) of the 1939 Code and § 7202 of the 1954 Code) based on failure to account for and pay withholding taxes. The defense was inability to pay. The trial judge instructed the jury that the term "wilful" in the misdemeanor counts meant, among other things, "capriciously or with a careless disregard whether one has the right so to act," whereas the same word in the felony counts meant "with knowledge of one's obligation to pay the taxes due and with intent to defraud the Government of that tax by any affirmative conduct." 254 F.2d, at 294. Relying on Spies, the Court of Appeals approved these instructions and concluded that
"the word `wilful' as used in the misdemeanor statute means something less when applied to a failure to make a return than as applied to a felony non-payment of a tax. This being true, then the words used in the instruction defining `wilful' as relates to a misdemeanor adequately and clearly point up that difference." Ibid.
*354 Because of an error in the cross-examination of Abdul. his conviction was reversed. On retrial, he was again convicted. He appealed, and the judgment was affirmed. Abdul v. United States, 278 F.2d 234 (CA9 1960). When Abdul sought certiorari, the Solicitor General conceded that the sentence under one of the counts could not stand and undertook to say that the Government would present to the District Court a motion for correction of the sentence. Certiorari, accordingly, was denied. Two Justices would have granted the writ to review the correctness of the charge "regarding the requirement of willfulness." 364 U.S. 832 (1960).
In the present case the Court of Appeals continued this Abdul distinction between willfulness in tax misdemeanor charges and willfulness in tax felony charges. Section 7207, it was said, requires only a showing of "unreasonable, capricious, or careless disregard for the truth or falsity of income tax returns filed," whereas § 7206 (1) "requires proof of an evil motive and bad faith." 455 F.2d, at 615. The level of willfulness, thus, would create a disputed factual element that made appropriate a lesser-included-offense instruction.
B. The decisions of this Court do not support the holding in Abdul, and implicitly they reject the approach taken by the Court of Appeals. In Spies, the Court speculated, 317 U.S., at 495-498, that Congress could have distinguished between the regulatory aspects of the tax system, which call for compliance regardless of financial status, and the revenue-collecting aspects, which may place demands on a taxpayer he cannot meet. Since the antecedent of § 7203 (as does that section itself today) punished both failure to file and failure to pay as misdemeanors, the Court concluded that Congress had not drawn the line between felonies and misdemeanors on the basis of distinctions between the system's regulatory aspects and its revenue-collecting aspects. The reliance *355 in Abdul on that hypothetical statutory scheme, discussed by this Court in Spies but found not in line with what Congress had actually done, was misplaced. Utilizing the unsupported Abdul distinction as a foundation. the Court of Appeals constructed the further general distinction between tax felonies and tax misdemeanors, a distinction also inconsistent with prior decisions of this Court.
In Berra v. United States, 351 U.S. 131 (1956), a defendant was convicted of violating the antecedent of § 7201, namely, § 145 (b) of the 1939 Code, a felony statute identical, for present purposes, with the section of the same number in the Revenue Act of 1936 at issue in Spies. The defendant claimed that he was entitled to a lesser-included-offense instruction based on § 3616 (a) of the 1939 Code, the antecedent of § 7207. The Court rejected this contention, concluding that the two sections of the 1939 Code then "covered precisely the same ground." 351 U.S., at 134. Implicit in this was the conclusion that the level of intent required for tax misdemeanors was not automatically lower than the level of intent required for tax felonies.
Although the misdemeanor statute, § 3616 (a), proffered by the defendant in Berra did not contain the word "willfully," the Berra facts were presented to the Court again in Sansone v. United States, 380 U.S. 343 (1965), when the misdemeanor statutes there in issue, §§ 7207 and 7203 of the 1954 Code, both contained the word "willfully."[5] In Sansone the Court rejected the argument *356 that a set of facts could exist that would satisfy the willfulness element in the § 7207 misdemeanor but not in the § 7201 felony:
"Given petitioner's material misstatement which resulted in a tax deficiency, if, as the jury obviously found, petitioner's act was willful in the sense that he knew that he should have reported more income than he did for the year 1957, he was guilty of violating both §§ 7201 and 7207. If his action was not willful, he was guilty of violating neither." 380 U.S., at 353.
The same analysis was applied to the requested lesser-included-offense instruction for § 7203. Id., at 352. The clear implication of the decision in Sansone is that the word "willfully" possesses the same meaning in §§ 7201, 7203, and 7207. Sansone thus foreclosed the argument that the word "willfully" was to be given one meaning in the tax felony statutes and another meaning in the tax misdemeanor statutes.
The thesis relied upon by the Court of Appeals, therefore, was incorrect.
V
It would be possible, of course, that the word "willfully" was intended by Congress to have a meaning in § 7206 (1) different from its meaning in § 7207, and we turn now to that possibility.
We continue to recognize that context is important in the quest for the word's meaning. See United States v. Murdock, 290 U.S. 389, 394-395 (1933). Here, as in Spies, the "legislative history of the section[s] contains nothing helpful on the question here at issue, and we must find the answer from the [sections themselves] and [their] context in the revenue laws."[6] 317 U. S., *357 at 495. We consider first, then, the sections themselves.
A. Respondent argues that both §§ 7206 (1) and 7207 apply to a fraudulent "return" and cover the same ground if the word "willfully" has the same meaning in both sections. Since "it would be unusual and we would not readily assume that Congress by the felony. . . meant no more than the same derelictions it had just defined . . . as a misdemeanor," 317 U.S., at 497, respondent concludes that Congress must have intended to require a more willful violation for the felony than for the misdemeanor.
The critical difficulty for respondent is that the two sections have substantially different express terms. The most obvious difference is that § 7206 (1) applies only if the document "contains or is verified by a written declaration that it is made under the penalties of perjury." No equivalent requirement is present in § 7207. Respondent recognizes this but then relies on the presence of perjury declarations on all federal income tax returns, a fact that effectively equalizes the sections where a federal tax return is at issue. See 26 U.S. C. § 6065 (a).[7]
This approach, however, is not persuasive for two reasons. First, the Secretary or his delegate has the power under § 6065 (a) to provide that no perjury declaration is required. If he does so provide, then § 7207 *358 immediately becomes operative in the area theretofore covered by § 7206 (1). Second, the term "return" is not necessarily limited to a federal income tax return. A state or other nonfederal return could be intended and might not contain a perjury warning. If this type of return were submitted in support of a federal return, or in the course of a tax audit, § 7207 could apply even if § 7206 (1) could not.
There are other distinctions. The felony applies to a document that a taxpayer "[w]illfully makes and subscribes. . . and which he does not believe to be true and correct as to every material matter," whereas the misdemeanor applies to a document that a taxpayer "willfully delivers or discloses to the Secretary or his delegate . . . known by him . . . to be false as to any material matter." In the felony, then, the taxpayer must verify the return or document in writing, and he is liable if he does not affirmatively believe that the material statements are true. For the misdemeanor, however, a document prepared by another could give rise to liability on the part of the taxpayer if he delivered or disclosed it to the Service; additional protection is given to the taxpayer in this situation because the document must be known by him to be fraudulent or to be false.
These differences in the respective applications of §§ 7206 (1) and 7207 provide solid evidence that Congress distinguished the statutes in ways that do not turn on the meaning of the word "willfully." Judge Hastie, in analyzing this Court's holding in Spies, appropriately described this distinction as follows:
"However, this distinction is found in the additional misconduct which is essential to the violation of the felony statute . . . and not in the quality *359 of willfulness which characterizes the wrongdoing." United States v. Vitiello, 363 F.2d 240, 243 (CA3 1966).
Thus the word "willfully" may have a uniform meaning in the several statutes without rendering any one of them surplusage. We next turn to context.
B. The hierarchy of tax offenses set forth in §§ 7201-7207, inclusive, utilizes the mental state of the offender as a guide in establishing the penalty. Section 7201, relating to attempts to evade or defeat tax, has been described and recognized by the Court as the "climax of this variety of sanctions" and as the "capstone of a system of sanctions which singly or in combination were calculated to induce prompt and forthright fulfillment of every duty under the income tax law and to provide a penalty suitable to every degree of delinquency." Spies, 317 U. S., at 497; Sansone, 380 U. S., at 350-351. The actor's mental state is described both by the requirement that acts be done "willfully" and by the designation of certain express elements of the offenses. In § 7201, for example, the Court has held that, by requiring an attempt to evade, "Congress intended some willful commission in addition to the willful omissions that make up the list of misdemeanors." Spies, 317 U. S., at 499. Similarly, in § 7207, the Government must show that the document was known by the taxpayer to be fraudulent or to be false as to a material matter.
All these offenses, except two subsections of § 7206, viz., subsections (3) and (4), require that acts be done "willfully." Although the described states of mind might be included in the normal meaning of the word "willfully," the presence of both an express designation and the simultaneous requirement that a violation be committed "willfully" is strong evidence that Congress used *360 the word "willfully" to describe a constant rather than a variable in the tax penalty formula.[8]
The Court, in fact, has recognized that the word "willfully" in these statutes generally connotes a voluntary, intentional violation of a known legal duty. It has formulated the requirement of willfulness as "bad faith or evil intent," Murdock, 290 U. S., at 398, or "evil motive and want of justification in view of all the financial circumstances of the taxpayer," Spies, 317 U. S., at 498, or knowledge that the taxpayer "should have reported more income than he did." Sansone, 380 U. S., at 353. See James v. United States, 366 U.S. 213, 221 (1961); McCarthy v. United States, 394 U.S. 459, 471 (1969).
This longstanding interpretation of the purpose of the recurring word "willfully" promotes coherence in the group of tax crimes. In our complex tax system, uncertainty often arises even among taxpayers who earnestly wish to follow the law. The Court has said, "It is not the purpose of the law to penalize frank difference of opinion or innocent errors made despite the *361 exercise of reasonable care." Spies, 317 U. S., at 496. Degrees of negligence give rise in the tax system to civil penalties. The requirement of an offense committed "willfully" is not met, therefore, if a taxpayer has relied in good faith on a prior decision of this Court. James v. United States, 366 U. S., at 221-222. Cf. Lambert v. California, 355 U.S. 255 (1957). The Court's consistent interpretation of the word "willfully" to require an element of mens rea implements the pervasive intent of Congress to construct penalties that separate the purposeful tax violator from the well-meaning, but easily confused, mass of taxpayers.
Until Congress speaks otherwise, we therefore shall continue to require, in both tax felonies and tax misdemeanors that must be done "willfully," the bad purpose or evil motive described in Murdock, supra. We hold, consequently, that the word "willfully" has the same meaning in § 7207 that it has in § 7206 (1). Since the only issue in dispute in this case centered on willfulness, it follows that a conviction of the misdemeanor would clearly support a conviction for the felony.[9] Under these circumstances a lesser-included-offense instruction was not required or proper, for in the federal system it is not the function of the jury to set the penalty. Berra v. United States, 351 U. S., at 134-135.
*362 The judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings.
It is so ordered.
| Chapter 75, subchapter A, of the Internal Revenue Code of 1954, as amended, 26 U.S. C. 7201-7241, is concerned with tax crimes. Sections 7201-7207, inclusive, which in the aggregate relate to attempts to evade or defeat tax, to failures to act, and to fraud, all include the word "willfully" in their respective contexts. Specifically, 7206 is a felony statute and reads: " 7206. Fraud and false statements. "Any person who "(1) Declaration under penalties of perjury. "Willfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter "shall be guilty of a felony and, upon conviction thereof, shall be fined not more than $5,000, or imprisoned not more than 3 years, or both, together with the costs of prosecution." Section 7207 is a misdemeanor statuteC[1] and reads: "7207. Fraudulent returns, statements, or other documents. *348 "Any person who willfully delivers or discloses to the Secretary or his delegate any list, return, account, statement, or other document, known by him to be fraudulent or to be false as to any material matter, shall be fined not more than $1,000, or imprisoned not more than 1 year, or both." This case presents the issue of the meaning of the critical word "willfully" as it is employed in these two successive statutes. Is its meaning the same in each, or is the willfulness specified by the misdemeanor statute, 7207, of somewhat less degree than the felony willfulness specified by 7206? I Respondent, Cecil J. Bishop, was convicted by a jury on all three counts of an indictment charging him with felony violations of 7206 (1) with respect to his federal income tax returns for the calendar years 1963, 1964, and 1965. The Court of Appeals, holding that a lesser-included-offense instruction directed to the misdemeanor statute, 7207, was improperly refused by the trial judge, reversed the judgment of the District Court and remanded the case for a new trial. Since the meaning of "willfully," as used in the tax crime statutes, has divided the circuits,[2] we granted certiorari. *349 We conclude that it was proper and correct for the District Court to refuse the lesser-included-offense instruction. In our view, the word "willfully" has the same meaning in both statutes. Consequently, we reverse and remand so that the Court of Appeals may now proceed to consider the additional issues that court found it unnecessary to reach. II Mr. Bishop is a lawyer who has practiced his profession in Sacramento, California, since 1951. During that period, he owned an interest in a walnut ranch he and his father operated. In his secretary, Louise, married his father. The father died, and thereafter respondent's stepmother managed the ranch. Respondent periodically sent checks to Louise. These were used to run the ranch, to pay principal on loans, and to make improvements. Louise maintained a record of ranch of expenditures and submitted an itemized list of these disbursements to respondent at the end of each calendar year. In his 1963 return respondent asserted as business deductions all amounts paid to Louise and, in addition, all the expenses Louise listed. This necessarily resulted in a double deduction for all ranch expenditures in 1963. Moreover, some of these expenditures were for repayment of loans and for other personal items that did not qualify as income tax deductions. In his 1964 and 1965 returns respondent similarly included nondeductible amounts among the ranch figures that were deducted. The aggregate amount of improper deductions taken by respondent for the three taxable years exceeded *350 $45,000. He enjoyed aggregate gross income for those years of about $70,000. The incorrectness of the returns as filed for the three years was not disputed at trial. Transcript of Trial 869-872, 1148. Neither is it disputed here. Brief for Respondent 4. III Section 7206 (1), the felony statute, is violated when one "[w]illfully makes and subscribes any return," under penalties of perjury, "which he does not believe to be true and correct as to every material matter." Respondent based his defense at trial on the ground that he was not aware of the double deductions asserted in 1963 or of the improper deductions taken in the three taxable years. He claimed that his law office secretary prepared the return schedules from his records and from the information furnished by Louise; he merely failed to check the returns for accuracy. Respondent requested lesser-included-offense instructions based on the misdemeanor statute, 7207. This tax misdemeanor is committed by one "who willfully delivers or discloses" to the Internal Revenue Service any return or document "known by him to be fraudulent or to be false as to any material matter." Respondent argued that the word "willfully" in the misdemeanor statute should be construed to require less scienter than the same word in the felony statute. App. 28. With the state of respondent's guilty knowledge in dispute, his proposed instructions would have allowed the jury to choose between a misdemeanor based on caprice or careless disregard and a felony requiring evil purpose. The trial judge declined to give the requested instructions and, instead, gave an instruction only on the felony, requiring a finding by the jury that the defendant intended *351 "with evil motive or bad purpose either to disobey or to disregard the law." App. 24. After the guilty verdict on all counts was returned, respondent was sentenced to two years' imprisonment on each count, the sentences to run concurrently. The court, however, suspended all but 90 days of each sentence and placed respondent on probation for five years on condition that he pay a fine of $5,000. App. 31. IV The Court of Appeals relied upon and a series of its own cases,[3] particularly enunciating the proposition that the word "willfully" has a meaning in tax felony statutes that is more stringent than its meaning in tax misdemeanor statutes.[4] Our examination of these Ninth Circuit precedents in the light of this Court's decisions leads us to conclude that the Court of Appeals' opinion cannot be sustained by this asserted distinction between 7206 (1) and 7207. A. The Ninth Circuit rule appears to have been evolved from language in this Court's opinion in In the defendant requested an instruction to the effect that an affirmative act was necessary to constitute a willful attempt to evade or defeat a tax, within the meaning of 145 (b) of the Revenue Act of 1936, The trial court *352 refused the request. The Second Circuit affirmed. This Court reversed. We were concerned in with a felony statute, 145 (b), applying to one "who willfully attempts in any manner to evade or defeat any tax," and with a companion misdemeanor statute, 145 (a), applying to one who "willfully fails to pay such tax, make such return, keep such records, or supply such information, at the time or times required by law or regulations." These statutes were the predecessors of the current 7201 and 7203, respectively, of the 1954 Code. In distinguishing between the two offenses, the Court said: "The difference between willful failure to pay a tax when due, which is made a misdemeanor, and willful attempt to defeat and evade one, which is made a felony, is not easy to detect or define. Both must be willful, and willful, as we have said, is a word of many meanings, its construction often being influenced by its context. United It may well mean something more as applied to nonpayment of a tax than when applied to failure to make a return. Mere voluntary and purposeful, as distinguished from accidental, omission to make a timely return might meet the test of willfulness. But in view of our traditional aversion to imprisonment for debt, we would not without the clearest manifestation of Congressional intent assume that mere knowing and intentional default in payment of a tax, where there had been no willful failure to disclose the liability, is intended to constitute a criminal offense of any degree. We would expect willfulness in such a case to include some element of evil motive and want of justification in view of all the financial circumstances of the taxpayer. "Had 145 (a) not included willful failure to pay a tax, it would have defined as misdemeanors generally *353 a failure to observe statutory duties to make timely returns, keep records, or supply information duties imposed to facilitate administration of the Act even if, because of insufficient net income, there were no duty to pay a tax. It would then be a permissible and perhaps an appropriate construction of 145 (b) that it made felonies of the same willful omissions when there was the added element of duty to pay a tax. The definition of such nonpayment as a misdemeanor, we think, argues strongly against such an interpretation." -498. In Abdul the court considered an appeal by a taxpayer convicted of tax misdemeanors ( 2707 (b) of the 1939 Code and 7203 of the 1954 Code) based on failure to file but acquitted of tax felonies ( 2707 (c) of the 1939 Code and 7202 of the 1954 Code) based on failure to account for and pay withholding taxes. The defense was inability to pay. The trial judge instructed the jury that the term "wilful" in the misdemeanor counts meant, among other things, "capriciously or with a careless disregard whether one has the right so to act," whereas the same word in the felony counts meant "with knowledge of one's obligation to pay the taxes due and with intent to defraud the Government of that tax by any affirmative conduct." Relying on the Court of Appeals approved these instructions and concluded that "the word `wilful' as used in the misdemeanor statute means something less when applied to a failure to make a return than as applied to a felony non-payment of a tax. This being true, then the words used in the instruction defining `wilful' as relates to a misdemeanor adequately and clearly point up that difference." *354 Because of an error in the cross-examination of Abdul. his conviction was reversed. On retrial, he was again convicted. He appealed, and the judgment was affirmed. When Abdul sought certiorari, the Solicitor General conceded that the sentence under one of the counts could not stand and undertook to say that the Government would present to the District Court a motion for correction of the sentence. Certiorari, accordingly, was denied. Two Justices would have granted the writ to review the correctness of the charge "regarding the requirement of willfulness." In the present case the Court of Appeals continued this Abdul distinction between willfulness in tax misdemeanor charges and willfulness in tax felony charges. Section 7207, it was said, requires only a showing of "unreasonable, capricious, or careless disregard for the truth or falsity of income tax returns filed," whereas 7206 (1) "requires proof of an evil motive and bad faith." The level of willfulness, thus, would create a disputed factual element that made appropriate a lesser-included-offense instruction. B. The decisions of this Court do not support the holding in Abdul, and implicitly they reject the approach taken by the Court of Appeals. In the Court -498, that Congress could have distinguished between the regulatory aspects of the tax system, which call for compliance regardless of financial status, and the revenue-collecting aspects, which may place demands on a taxpayer he cannot meet. Since the antecedent of 7203 (as does that section itself today) punished both failure to file and failure to pay as misdemeanors, the Court concluded that Congress had not drawn the line between felonies and misdemeanors on the basis of distinctions between the system's regulatory aspects and its revenue-collecting aspects. The reliance *355 in Abdul on that hypothetical statutory scheme, discussed by this Court in but found not in line with what Congress had actually done, was misplaced. Utilizing the unsupported Abdul distinction as a foundation. the Court of Appeals constructed the further general distinction between tax felonies and tax misdemeanors, a distinction also inconsistent with prior decisions of this Court. In a defendant was convicted of violating the antecedent of 7201, namely, 145 (b) of the 1939 Code, a felony statute identical, for present purposes, with the section of the same number in the Revenue Act of 1936 at issue in The defendant claimed that he was entitled to a lesser-included-offense instruction based on 3616 (a) of the 1939 Code, the antecedent of 7207. The Court rejected this contention, concluding that the two sections of the 1939 Code then "covered precisely the same ground." Implicit in this was the conclusion that the level of intent required for tax misdemeanors was not automatically lower than the level of intent required for tax felonies. Although the misdemeanor statute, 3616 (a), proffered by the defendant in Berra did not contain the word "willfully," the Berra facts were presented to the Court again in when the misdemeanor statutes there in issue, 7207 and 7203 of the 1954 Code, both contained the word "willfully."[5] In the Court rejected the argument *356 that a set of facts could exist that would satisfy the willfulness element in the 7207 misdemeanor but not in the 7201 felony: "Given petitioner's material misstatement which resulted in a tax deficiency, if, as the jury obviously found, petitioner's act was willful in the sense that he knew that he should have reported more income than he did for the year 1957, he was guilty of violating both 7201 and 7207. If his action was not willful, he was guilty of violating neither." The same analysis was applied to the requested lesser-included-offense instruction for 7203. The clear implication of the decision in is that the word "willfully" possesses the same meaning in 7201, 7203, and 7207. thus foreclosed the argument that the word "willfully" was to be given one meaning in the tax felony statutes and another meaning in the tax misdemeanor statutes. The thesis relied upon by the Court of Appeals, therefore, was incorrect. V It would be possible, of course, that the word "willfully" was intended by Congress to have a meaning in 7206 (1) different from its meaning in 7207, and we turn now to that possibility. We continue to recognize that context is important in the quest for the word's meaning. See United Here, as in the "legislative history of the section[s] contains nothing helpful on the question here at issue, and we must find the answer from the [sections themselves] and [their] context in the revenue laws."[6] 317 U. S., *357 at 495. We consider first, then, the sections themselves. A. Respondent argues that both 7206 (1) and 7207 apply to a fraudulent "return" and cover the same ground if the word "willfully" has the same meaning in both sections. Since "it would be unusual and we would not readily assume that Congress by the felony. meant no more than the same derelictions it had just defined as a misdemeanor," respondent concludes that Congress must have intended to require a more willful violation for the felony than for the misdemeanor. The critical difficulty for respondent is that the two sections have substantially different express terms. The most obvious difference is that 7206 (1) applies only if the document "contains or is verified by a written declaration that it is made under the penalties of perjury." No equivalent requirement is present in 7207. Respondent recognizes this but then relies on the presence of perjury declarations on all federal income tax returns, a fact that effectively equalizes the sections where a federal tax return is at issue. See 26 U.S. C. 6065 (a).[7] This approach, however, is not persuasive for two reasons. First, the Secretary or his delegate has the power under 6065 (a) to provide that no perjury declaration is required. If he does so provide, then 7207 *358 immediately becomes operative in the area theretofore covered by 7206 (1). Second, the term "return" is not necessarily limited to a federal income tax return. A state or other nonfederal return could be intended and might not contain a perjury warning. If this type of return were submitted in support of a federal return, or in the course of a tax audit, 7207 could apply even if 7206 (1) could not. There are other distinctions. The felony applies to a document that a taxpayer "[w]illfully makes and subscribes. and which he does not believe to be true and correct as to every material matter," whereas the misdemeanor applies to a document that a taxpayer "willfully delivers or discloses to the Secretary or his delegate known by him to be false as to any material matter." In the felony, then, the taxpayer must verify the return or document in writing, and he is liable if he does not affirmatively believe that the material statements are true. For the misdemeanor, however, a document prepared by another could give rise to liability on the part of the taxpayer if he delivered or disclosed it to the Service; additional protection is given to the taxpayer in this situation because the document must be known by him to be fraudulent or to be false. These differences in the respective applications of 7206 (1) and 7207 provide solid evidence that Congress distinguished the statutes in ways that do not turn on the meaning of the word "willfully." Judge Hastie, in analyzing this Court's holding in appropriately described this distinction as follows: "However, this distinction is found in the additional misconduct which is essential to the violation of the felony statute and not in the quality *359 of willfulness which characterizes the wrongdoing." United Thus the word "willfully" may have a uniform meaning in the several statutes without rendering any one of them surplusage. We next turn to context. B. The hierarchy of tax offenses set forth in 7201-7207, inclusive, utilizes the mental state of the offender as a guide in establishing the penalty. Section 7201, relating to attempts to evade or defeat tax, has been described and recognized by the Court as the "climax of this variety of sanctions" and as the "capstone of a system of sanctions which singly or in combination were calculated to induce prompt and forthright fulfillment of every duty under the income tax law and to provide a penalty suitable to every degree of delinquency." ; -351. The actor's mental state is described both by the requirement that acts be done "willfully" and by the designation of certain express elements of the offenses. In 7201, for example, the Court has held that, by requiring an attempt to evade, "Congress intended some willful commission in addition to the willful omissions that make up the list of misdemeanors." Similarly, in 7207, the Government must show that the document was known by the taxpayer to be fraudulent or to be false as to a material matter. All these offenses, except two subsections of 7206, viz., subsections (3) and (4), require that acts be done "willfully." Although the described states of mind might be included in the normal meaning of the word "willfully," the presence of both an express designation and the simultaneous requirement that a violation be committed "willfully" is strong evidence that Congress used *360 the word "willfully" to describe a constant rather than a variable in the tax penalty formula.[8] The Court, in fact, has recognized that the word "willfully" in these statutes generally connotes a voluntary, intentional violation of a known legal duty. It has formulated the requirement of willfulness as "bad faith or evil intent," or "evil motive and want of justification in view of all the financial circumstances of the taxpayer," or knowledge that the taxpayer "should have reported more income than he did." See ; This longstanding interpretation of the purpose of the recurring word "willfully" promotes coherence in the group of tax crimes. In our complex tax system, uncertainty often arises even among taxpayers who earnestly wish to follow the law. The Court has said, "It is not the purpose of the law to penalize frank difference of opinion or innocent errors made despite the *361 exercise of reasonable care." Degrees of negligence give rise in the tax system to civil penalties. The requirement of an offense committed "willfully" is not met, therefore, if a taxpayer has relied in good faith on a prior decision of this Court. 366 U. S., at -222. Cf. The Court's consistent interpretation of the word "willfully" to require an element of mens rea implements the pervasive intent of Congress to construct penalties that separate the purposeful tax violator from the well-meaning, but easily confused, mass of taxpayers. Until Congress speaks otherwise, we therefore shall continue to require, in both tax felonies and tax misdemeanors that must be done "willfully," the bad purpose or evil motive described in We hold, consequently, that the word "willfully" has the same meaning in 7207 that it has in 7206 (1). Since the only issue in dispute in this case centered on willfulness, it follows that a conviction of the misdemeanor would clearly support a conviction for the felony.[9] Under these circumstances a lesser-included-offense instruction was not required or proper, for in the federal system it is not the function of the jury to set the penalty. -135. *362 The judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings. It is so ordered. |
Justice Stevens | majority | false | United States v. Jacobsen | 1984-04-02T00:00:00 | null | https://www.courtlistener.com/opinion/111143/united-states-v-jacobsen/ | https://www.courtlistener.com/api/rest/v3/clusters/111143/ | 1,984 | 1983-064 | 1 | 7 | 2 | During their examination of a damaged package, the employees of a private freight carrier observed a white powdery substance, originally concealed within eight layers of wrappings. They summoned a federal agent, who removed a trace of the powder, subjected it to a chemical test and determined that it was cocaine. The question presented is whether the Fourth Amendment required the agent to obtain a warrant before he did so.
The relevant facts are not in dispute. Early in the morning of May 1, 1981, a supervisor at the Minneapolis-St. Paul Airport Federal Express office asked the office manager to look at a package that had been damaged and torn by a fork-lift. They then opened the package in order to examine its contents pursuant to a written company policy regarding insurance claims.
The container was an ordinary cardboard box wrapped in brown paper. Inside the box five or six pieces of crumpled newspaper covered a tube about 10 inches long; the tube was made of the silver tape used on basement ducts. The supervisor and office manager cut open the tube, and found a series of four zip-lock plastic bags, the outermost enclosing the other three and the innermost containing about six and a half ounces of white powder. When they observed the white powder in the innermost bag, they notified the Drug Enforcement Administration. Before the first DEA agent arrived, they replaced the plastic bags in the tube and put the tube and the newspapers back into the box.
When the first federal agent arrived, the box, still wrapped in brown paper, but with a hole punched in its side and the top open, was placed on a desk. The agent saw that one end of the tube had been slit open; he removed the four plastic bags from the tube and saw the white powder. He then opened each of the four bags and removed a trace of the *112 white substance with a knife blade. A field test made on the spot identified the substance as cocaine.[1]
In due course, other agents arrived, made a second field test, rewrapped the package, obtained a warrant to search the place to which it was addressed, executed the warrant, and arrested respondents. After they were indicted for the crime of possessing an illegal substance with intent to distribute, their motion to suppress the evidence on the ground that the warrant was the product of an illegal search and seizure was denied; they were tried and convicted, and appealed. The Court of Appeals reversed. 683 F.2d 296 (CA8 1982). It held that the validity of the search warrant depended on the validity of the agents' warrantless test of the white powder,[2] that the testing constituted a significant expansion of the earlier private search, and that a warrant was required.
As the Court of Appeals recognized, its decision conflicted with a decision of another Court of Appeals on comparable facts, United States v. Barry, 673 F.2d 912 (CA6), cert. denied, 459 U.S. 927 (1982).[3] For that reason, and because *113 field tests play an important role in the enforcement of the narcotics laws, we granted certiorari, 460 U.S. 1021.
I
The first Clause of the Fourth Amendment provides that the "right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated . . . ." This text protects two types of expectations, one involving "searches," the other "seizures." A "search" occurs when an expectation of privacy that society is prepared to consider reasonable is infringed.[4] A "seizure" of property occurs when there is some meaningful interference with an individual's possessory interests in that property.[5] This Court has also consistently construed this protection as proscribing only governmental action; it is wholly inapplicable "to a search or seizure, even an unreasonable one, effected by a private individual not acting as an agent of the Government or with the participation or knowledge of any governmental official." Walter v. *114 United States, 447 U.S. 649, 662 (1980) (BLACKMUN, J., dissenting).[6]
When the wrapped parcel involved in this case was delivered to the private freight carrier, it was unquestionably an "effect" within the meaning of the Fourth Amendment. Letters and other sealed packages are in the general class of effects in which the public at large has a legitimate expectation of privacy; warrantless searches of such effects are presumptively unreasonable.[7] Even when government agents may lawfully seize such a package to prevent loss or destruction of suspected contraband, the Fourth Amendment requires that they obtain a warrant before examining the contents of such a package.[8] Such a warrantless search could not be characterized as reasonable simply because, after the official invasion of privacy occurred, contraband is discovered.[9] Conversely, in this case the fact that agents of the private carrier independently opened the package and made an examination that might have been impermissible for a government agent *115 cannot render otherwise reasonable official conduct unreasonable. The reasonableness of an official invasion of the citizen's privacy must be appraised on the basis of the facts as they existed at the time that invasion occurred.
The initial invasions of respondents' package were occasioned by private action. Those invasions revealed that the package contained only one significant item, a suspicious looking tape tube. Cutting the end of the tube and extracting its contents revealed a suspicious looking plastic bag of white powder. Whether those invasions were accidental or deliberate,[10] and whether they were reasonable or unreasonable, they did not violate the Fourth Amendment because of their private character.
The additional invasions of respondents' privacy by the Government agent must be tested by the degree to which they exceeded the scope of the private search. That standard was adopted by a majority of the Court in Walter v. United States, supra. In Walter a private party had opened a misdirected carton, found rolls of motion picture films that appeared to be contraband, and turned the carton over to the Federal Bureau of Investigation. Later, without obtaining a warrant, FBI agents obtained a projector and viewed the films. While there was no single opinion of the Court, a majority did agree on the appropriate analysis of a governmental search which follows on the heels of a private one. Two Justices took the position:
"If a properly authorized official search is limited by the particular terms of its authorization, at least the same kind of strict limitation must be applied to any official *116 use of a private party's invasion of another person's privacy. Even though some circumstances for example, if the results of the private search are in plain view when materials are turned over to the Government may justify the Government's reexamination of the materials, surely the Government may not exceed the scope of the private search unless it has the right to make an independent search. In these cases, the private party had not actually viewed the films. Prior to the Government screening, one could only draw inferences about what was on the films. The projection of the films was a significant expansion of the search that had been conducted previously by a private party and therefore must be characterized as a separate search." Id., at 657 (opinion of STEVENS, J., joined by Stewart, J.) (footnote omitted).[11]
Four additional Justices, while disagreeing with this characterization of the scope of the private search, were also of the view that the legality of the governmental search must be tested by the scope of the antecedent private search.
"`Under these circumstances, since the L'Eggs employees so fully ascertained the nature of the films before contacting the authorities, we find that the FBI's subsequent viewing of the movies on a projector did not "change the nature of the search" and was not an additional search subject to the warrant requirement.' " Id., at 663-664 (BLACKMUN, J., dissenting, joined by BURGER, C. J., and POWELL and REHNQUIST, JJ.) (footnote omitted) (quoting United States v. Sanders, 592 *117 F. 2d 788, 793-794 (CA5 1979) (case below in Walter).[12]
This standard follows from the analysis applicable when private parties reveal other kinds of private information to the authorities. It is well settled that when an individual reveals private information to another, he assumes the risk that his confidant will reveal that information to the authorities, and if that occurs the Fourth Amendment does not prohibit governmental use of that information. Once frustration of the original expectation of privacy occurs, the Fourth Amendment does not prohibit governmental use of the now nonprivate information: "This Court has held repeatedly that the Fourth Amendment does not prohibit the obtaining of information revealed to a third party and conveyed by him to Government authorities, even if the information is revealed on the assumption that it will be used only for a limited purpose and the confidence placed in a third party will not be betrayed." United States v. Miller, 425 U.S. 435, 443 (1976).[13] The Fourth Amendment is implicated only if the authorities use information with respect to which the expectation of privacy has not already been frustrated. In such a case the authorities have not relied on what is in effect a private *118 search, and therefore presumptively violate the Fourth Amendment if they act without a warrant.[14]
In this case, the federal agents' invasions of respondents' privacy involved two steps: first, they removed the tube from the box, the plastic bags from the tube, and a trace of powder from the innermost bag; second, they made a chemical test of the powder. Although we ultimately conclude that both actions were reasonable for essentially the same reason, it is useful to discuss them separately.
II
When the first federal agent on the scene initially saw the package, he knew it contained nothing of significance except a tube containing plastic bags and, ultimately, white powder. It is not entirely clear that the powder was visible to him before he removed the tube from the box.[15] Even if the white *119 powder was not itself in "plain view" because it was still enclosed in so many containers and covered with papers, there was a virtual certainty that nothing else of significance was in the package and that a manual inspection of the tube and its contents would not tell him anything more than he already had been told. Respondents do not dispute that the Government could utilize the Federal Express employees' testimony concerning the contents of the package. If that is the case, it hardly infringed respondents' privacy for the agents to re-examine the contents of the open package by brushing aside a crumpled newspaper and picking up the tube. The advantage the Government gained thereby was merely avoiding the risk of a flaw in the employees' recollection, rather than in further infringing respondents' privacy. Protecting the risk of misdescription hardly enhances any legitimate privacy interest, and is not protected by the Fourth Amendment.[16] Respondents could have no privacy interest in the contents of the package, since it remained unsealed and since the Federal Express employees had just examined the package and had, of their own accord, invited the federal agent to their offices for the express purpose of viewing its contents. The agent's viewing of what a private party had freely made available for his inspection did not violate the Fourth Amendment. *120 See Coolidge v. New Hampshire, 403 U.S. 443, 487-490 (1971); Burdeau v. McDowell, 256 U.S. 465, 475-476 (1921).
Similarly, the removal of the plastic bags from the tube and the agent's visual inspection of their contents enabled the agent to learn nothing that had not previously been learned during the private search.[17] It infringed no legitimate expectation of privacy and hence was not a "search" within the meaning of the Fourth Amendment.
While the agents' assertion of dominion and control over the package and its contents did constitute a "seizure,"[18] that *121 seizure was not unreasonable. The fact that, prior to the field test, respondents' privacy interest in the contents of the package had been largely compromised is highly relevant to the reasonableness of the agents' conduct in this respect. The agents had already learned a great deal about the contents of the package from the Federal Express employees, all of which was consistent with what they could see. The package itself, which had previously been opened, remained unsealed, and the Federal Express employees had invited the agents to examine its contents. Under these circumstances, the package could no longer support any expectation of privacy; it was just like a balloon "the distinctive character [of which] spoke volumes as to its contents particularly to the trained eye of the officer," Texas v. Brown, 460 U.S. 730, 743 (1983) (plurality opinion); see also id., at 746 (POWELL, J., concurring in judgment); or the hypothetical gun case in Arkansas v. Sanders, 442 U.S. 753, 764-765, n. 13 (1979). Such containers may be seized, at least temporarily, without a warrant.[19] Accordingly, since it was apparent that the tube and plastic bags contained contraband and little else, this warrantless seizure was reasonable,[20] for it is well settled that it is constitutionally reasonable for law enforcement officials to seize "effects" that cannot support a justifiable expectation *122 of privacy without a warrant, based on probable cause to believe they contain contraband.[21]
III
The question remains whether the additional intrusion occasioned by the field test, which had not been conducted by the Federal Express employees and therefore exceeded the scope of the private search, was an unlawful "search" or "seizure" within the meaning of the Fourth Amendment.
The field test at issue could disclose only one fact previously unknown to the agent whether or not a suspicious white powder was cocaine. It could tell him nothing more, not even whether the substance was sugar or talcum powder. We must first determine whether this can be considered a "search" subject to the Fourth Amendment did it infringe an expectation of privacy that society is prepared to consider reasonable?
The concept of an interest in privacy that society is prepared to recognize as reasonable is, by its very nature, critically different from the mere expectation, however well justified, that certain facts will not come to the attention of the authorities.[22] Indeed, this distinction underlies the rule that *123 government may utilize information voluntarily disclosed to a governmental informant, despite the criminal's reasonable expectation that his associates would not disclose confidential information to the authorities. See United States v. White, 401 U.S. 745, 751-752 (1971) (plurality opinion).
A chemical test that merely discloses whether or not a particular substance is cocaine does not compromise any legitimate interest in privacy. This conclusion is not dependent on the result of any particular test. It is probably safe to assume that virtually all of the tests conducted under circumstances comparable to those disclosed by this record would result in a positive finding; in such cases, no legitimate interest has been compromised. But even if the results are negative merely disclosing that the substance is something other than cocaine such a result reveals nothing of special interest. Congress has decided and there is no question about its power to do so to treat the interest in "privately" possessing cocaine as illegitimate; thus governmental conduct that can reveal whether a substance is cocaine, and no other arguably "private" fact, compromises no legitimate privacy interest.[23]
This conclusion is dictated by United States v. Place, 462 U.S. 696 (1983), in which the Court held that subjecting luggage to a "sniff test" by a trained narcotics detection dog was not a "search" within the meaning of the Fourth Amendment:
*124 "A `canine sniff' by a well-trained narcotics detection dog, however, does not require opening the luggage. It does not expose noncontraband items that otherwise would remain hidden from public view, as does, for example, an officer's rummaging through the contents of the luggage. Thus, the manner in which information is obtained through this investigative technique is much less intrusive than a typical search. Moreover, the sniff discloses only the presence or absence of narcotics, a contraband item. Thus, despite the fact that the sniff tells the authorities something about the contents of the luggage, the information obtained is limited." Id., at 707.[24]
Here, as in Place, the likelihood that official conduct of the kind disclosed by the record will actually compromise any legitimate interest in privacy seems much too remote to characterize the testing as a search subject to the Fourth Amendment.
We have concluded, in Part II, supra, that the initial "seizure" of the package and its contents was reasonable. Nevertheless, as Place also holds, a seizure lawful at its inception can nevertheless violate the Fourth Amendment because its manner of execution unreasonably infringes possessory interests protected by the Fourth Amendment's prohibition on "unreasonable seizures."[25] Here, the field test did affect respondents' possessory interests protected by the Amendment, since by destroying a quantity of the powder it converted *125 what had been only a temporary deprivation of possessory interests into a permanent one. To assess the reasonableness of this conduct, "[w]e must balance the nature and quality of the intrusion on the individual's Fourth Amendment interests against the importance of the governmental interests alleged to justify the intrusion." 462 U.S., at 703.[26]
Applying this test, we conclude that the destruction of the powder during the course of the field test was reasonable. The law enforcement interests justifying the procedure were substantial; the suspicious nature of the material made it virtually certain that the substance tested was in fact contraband. Conversely, because only a trace amount of material was involved, the loss of which appears to have gone unnoticed by respondents, and since the property had already been lawfully detained, the "seizure" could, at most, have only a de minimis impact on any protected property interest. Cf. Cardwell v. Lewis, 417 U.S. 583, 591-592 (1974) (plurality opinion) (examination of automobile's tires and taking of paint scrapings was a de minimis invasion of constitutional interests).[27] Under these circumstances, the safeguards of a warrant would only minimally advance Fourth Amendment interests. This warrantless "seizure" was reasonable.[28]
*126 In sum, the federal agents did not infringe any constitutionally protected privacy interest that had not already been frustrated as the result of private conduct. To the extent that a protected possessory interest was infringed, the infringement was de minimis and constitutionally reasonable. The judgment of the Court of Appeals is
Reversed.
JUSTICE WHITE, concurring in part and concurring in the judgment. | During their examination of a damaged package, the employees of a private freight carrier observed a white powdery substance, originally concealed within eight layers of wrappings. They summoned a federal agent, who removed a trace of the powder, subjected it to a chemical test and determined that it was cocaine. The question presented is whether the Fourth Amendment required the agent to obtain a warrant before he did so. The relevant facts are not in dispute. Early in the morning of May 1, 1981, a supervisor at the Minneapolis-St. Paul Airport Federal Express office asked the office manager to look at a package that had been damaged and torn by a fork-lift. They then opened the package in order to examine its contents pursuant to a written company policy regarding insurance claims. The container was an ordinary cardboard box wrapped in brown paper. Inside the box five or six pieces of crumpled newspaper covered a tube about 10 inches long; the tube was made of the silver tape used on basement ducts. The supervisor and office manager cut open the tube, and found a series of four zip-lock plastic bags, the outermost enclosing the other three and the innermost containing about six and a half ounces of white powder. When they observed the white powder in the innermost bag, they notified the Drug Enforcement Administration. Before the first DEA agent arrived, they replaced the plastic bags in the tube and put the tube and the newspapers back into the box. When the first federal agent arrived, the box, still wrapped in brown paper, but with a hole punched in its side and the top open, was placed on a desk. The agent saw that one end of the tube had been slit open; he removed the four plastic bags from the tube and saw the white powder. He then opened each of the four bags and removed a trace of the *112 white substance with a knife blade. A field test made on the spot identified the substance as cocaine.[1] In due course, other agents arrived, made a second field test, rewrapped the package, obtained a warrant to search the place to which it was addressed, executed the warrant, and arrested respondents. After they were indicted for the crime of possessing an illegal substance with intent to distribute, their motion to suppress the evidence on the ground that the warrant was the product of an illegal search and seizure was denied; they were tried and convicted, and appealed. The Court of Appeals reversed. It held that the validity of the search warrant depended on the validity of the agents' warrantless test of the white powder,[2] that the testing constituted a significant expansion of the earlier private search, and that a warrant was required. As the Court of Appeals recognized, its decision conflicted with a decision of another Court of Appeals on comparable facts, United (CA6), cert. denied,[3] For that reason, and because *113 field tests play an important role in the enforcement of the narcotics laws, we granted certiorari, I The first Clause of the Fourth Amendment provides that the "right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated" This text protects two types of expectations, one involving "searches," the other "seizures." A "search" occurs when an expectation of privacy that society is prepared to consider reasonable is infringed.[4] A "seizure" of property occurs when there is some meaningful interference with an individual's possessory interests in that property.[5] This Court has also consistently construed this protection as proscribing only governmental action; it is wholly inapplicable "to a search or seizure, even an unreasonable one, effected by a private individual not acting as an agent of the Government or with the participation or knowledge of any governmental official."[6] When the wrapped parcel involved in this case was delivered to the private freight carrier, it was unquestionably an "effect" within the meaning of the Fourth Amendment. Letters and other sealed packages are in the general class of effects in which the public at large has a legitimate expectation of privacy; warrantless searches of such effects are presumptively unreasonable.[7] Even when government agents may lawfully seize such a package to prevent loss or destruction of suspected contraband, the Fourth Amendment requires that they obtain a warrant before examining the contents of such a package.[8] Such a warrantless search could not be characterized as reasonable simply because, after the official invasion of privacy occurred, contraband is discovered.[9] Conversely, in this case the fact that agents of the private carrier independently opened the package and made an examination that might have been impermissible for a government agent *115 cannot render otherwise reasonable official conduct unreasonable. The reasonableness of an official invasion of the citizen's privacy must be appraised on the basis of the facts as they existed at the time that invasion occurred. The initial invasions of respondents' package were occasioned by private action. Those invasions revealed that the package contained only one significant item, a suspicious looking tape tube. Cutting the end of the tube and extracting its contents revealed a suspicious looking plastic bag of white powder. Whether those invasions were accidental or deliberate,[10] and whether they were reasonable or unreasonable, they did not violate the Fourth Amendment because of their private character. The additional invasions of respondents' privacy by the Government agent must be tested by the degree to which they exceeded the scope of the private search. That standard was adopted by a majority of the Court in Walter v. United In Walter a private party had opened a misdirected carton, found rolls of motion picture films that appeared to be contraband, and turned the carton over to the Federal Bureau of Investigation. Later, without obtaining a warrant, FBI agents obtained a projector and viewed the films. While there was no single opinion of the Court, a majority did agree on the appropriate analysis of a governmental search which follows on the heels of a private one. Two Justices took the position: "If a properly authorized official search is limited by the particular terms of its authorization, at least the same kind of strict limitation must be applied to any official *116 use of a private party's invasion of another person's privacy. Even though some circumstances for example, if the results of the private search are in plain view when materials are turned over to the Government may justify the Government's reexamination of the materials, surely the Government may not exceed the scope of the private search unless it has the right to make an independent search. In these cases, the private party had not actually viewed the films. Prior to the Government screening, one could only draw inferences about what was on the films. The projection of the films was a significant expansion of the search that had been conducted previously by a private party and therefore must be characterized as a separate search." (footnote omitted).[11] Four additional Justices, while disagreeing with this characterization of the scope of the private search, were also of the view that the legality of the governmental search must be tested by the scope of the antecedent private search. "`Under these circumstances, since the L'Eggs employees so fully ascertained the nature of the films before contacting the authorities, we find that the FBI's subsequent viewing of the movies on a projector did not "change the nature of the search" and was not an additional search subject to the warrant requirement.' " (footnote omitted)[12] This standard follows from the analysis applicable when private parties reveal other kinds of private information to the authorities. It is well settled that when an individual reveals private information to another, he assumes the risk that his confidant will reveal that information to the authorities, and if that occurs the Fourth Amendment does not prohibit governmental use of that information. Once frustration of the original expectation of privacy occurs, the Fourth Amendment does not prohibit governmental use of the now nonprivate information: "This Court has held repeatedly that the Fourth Amendment does not prohibit the obtaining of information revealed to a third party and conveyed by him to Government authorities, even if the information is revealed on the assumption that it will be used only for a limited purpose and the confidence placed in a third party will not be betrayed." United v. Miller,[13] The Fourth Amendment is implicated only if the authorities use information with respect to which the expectation of privacy has not already been frustrated. In such a case the authorities have not relied on what is in effect a private *118 search, and therefore presumptively violate the Fourth Amendment if they act without a warrant.[14] In this case, the federal agents' invasions of respondents' privacy involved two steps: first, they removed the tube from the box, the plastic bags from the tube, and a trace of powder from the innermost bag; second, they made a chemical test of the powder. Although we ultimately conclude that both actions were reasonable for essentially the same reason, it is useful to discuss them separately. When the first federal agent on the scene initially saw the package, he knew it contained nothing of significance except a tube containing plastic bags and, ultimately, white powder. It is not entirely clear that the powder was visible to him before he removed the tube from the box.[15] Even if the white *119 powder was not itself in "plain view" because it was still enclosed in so many containers and covered with papers, there was a virtual certainty that nothing else of significance was in the package and that a manual inspection of the tube and its contents would not tell him anything more than he already had been told. Respondents do not dispute that the Government could utilize the Federal Express employees' testimony concerning the contents of the package. If that is the case, it hardly infringed respondents' privacy for the agents to re-examine the contents of the open package by brushing aside a crumpled newspaper and picking up the tube. The advantage the Government gained thereby was merely avoiding the risk of a flaw in the employees' recollection, rather than in further infringing respondents' privacy. Protecting the risk of misdescription hardly enhances any legitimate privacy interest, and is not protected by the Fourth Amendment.[16] Respondents could have no privacy interest in the contents of the package, since it remained unsealed and since the Federal Express employees had just examined the package and had, of their own accord, invited the federal agent to their offices for the express purpose of viewing its contents. The agent's viewing of what a private party had freely made available for his inspection did not violate the Fourth Amendment. *120 See 403 U.S. ; Similarly, the removal of the plastic bags from the tube and the agent's visual inspection of their contents enabled the agent to learn nothing that had not previously been learned during the private search.[17] It infringed no legitimate expectation of privacy and hence was not a "search" within the meaning of the Fourth Amendment. While the agents' assertion of dominion and control over the package and its contents did constitute a "seizure,"[18] that *121 seizure was not unreasonable. The fact that, prior to the field test, respondents' privacy interest in the contents of the package had been largely compromised is highly relevant to the reasonableness of the agents' conduct in this respect. The agents had already learned a great deal about the contents of the package from the Federal Express employees, all of which was consistent with what they could see. The package itself, which had previously been opened, remained unsealed, and the Federal Express employees had invited the agents to examine its contents. Under these circumstances, the package could no longer support any expectation of privacy; it was just like a balloon "the distinctive character [of which] spoke volumes as to its contents particularly to the trained eye of the officer," ; see also ; or the hypothetical gun case in Such containers may be seized, at least temporarily, without a warrant.[19] Accordingly, since it was apparent that the tube and plastic bags contained contraband and little else, this warrantless seizure was reasonable,[20] for it is well settled that it is constitutionally reasonable for law enforcement officials to seize "effects" that cannot support a justifiable expectation *122 of privacy without a warrant, based on probable cause to believe they contain contraband.[21] I The question remains whether the additional intrusion occasioned by the field test, which had not been conducted by the Federal Express employees and therefore exceeded the scope of the private search, was an unlawful "search" or "seizure" within the meaning of the Fourth Amendment. The field test at issue could disclose only one fact previously unknown to the agent whether or not a suspicious white powder was cocaine. It could tell him nothing more, not even whether the substance was sugar or talcum powder. We must first determine whether this can be considered a "search" subject to the Fourth Amendment did it infringe an expectation of privacy that society is prepared to consider reasonable? The concept of an interest in privacy that society is prepared to recognize as reasonable is, by its very nature, critically different from the mere expectation, however well justified, that certain facts will not come to the attention of the authorities.[22] Indeed, this distinction underlies the rule that *123 government may utilize information voluntarily disclosed to a governmental informant, despite the criminal's reasonable expectation that his associates would not disclose confidential information to the authorities. See United v. White, A chemical test that merely discloses whether or not a particular substance is cocaine does not compromise any legitimate interest in privacy. This conclusion is not dependent on the result of any particular test. It is probably safe to assume that virtually all of the tests conducted under circumstances comparable to those disclosed by this record would result in a positive finding; in such cases, no legitimate interest has been compromised. But even if the results are negative merely disclosing that the substance is something other than cocaine such a result reveals nothing of special interest. Congress has decided and there is no question about its power to do so to treat the interest in "privately" possessing cocaine as illegitimate; thus governmental conduct that can reveal whether a substance is cocaine, and no other arguably "private" fact, compromises no legitimate privacy interest.[23] This conclusion is dictated by United v. Place, in which the Court held that subjecting luggage to a "sniff test" by a trained narcotics detection dog was not a "search" within the meaning of the Fourth Amendment: *124 "A `canine sniff' by a well-trained narcotics detection dog, however, does not require opening the luggage. It does not expose noncontraband items that otherwise would remain hidden from public view, as does, for example, an officer's rummaging through the contents of the luggage. Thus, the manner in which information is obtained through this investigative technique is much less intrusive than a typical search. Moreover, the sniff discloses only the presence or absence of narcotics, a contraband item. Thus, despite the fact that the sniff tells the authorities something about the contents of the luggage, the information obtained is limited."[24] Here, as in Place, the likelihood that official conduct of the kind disclosed by the record will actually compromise any legitimate interest in privacy seems much too remote to characterize the testing as a search subject to the Fourth Amendment. We have concluded, in Part that the initial "seizure" of the package and its contents was reasonable. Nevertheless, as Place also holds, a seizure lawful at its inception can nevertheless violate the Fourth Amendment because its manner of execution unreasonably infringes possessory interests protected by the Fourth Amendment's prohibition on "unreasonable seizures."[25] Here, the field test did affect respondents' possessory interests protected by the Amendment, since by destroying a quantity of the powder it converted *125 what had been only a temporary deprivation of possessory interests into a permanent one. To assess the reasonableness of this conduct, "[w]e must balance the nature and quality of the intrusion on the individual's Fourth Amendment interests against the importance of the governmental interests alleged to justify the intrusion."[26] Applying this test, we conclude that the destruction of the powder during the course of the field test was reasonable. The law enforcement interests justifying the procedure were substantial; the suspicious nature of the material made it virtually certain that the substance tested was in fact contraband. Conversely, because only a trace amount of material was involved, the loss of which appears to have gone unnoticed by respondents, and since the property had already been lawfully detained, the "seizure" could, at most, have only a de minimis impact on any protected property interest. Cf. (examination of automobile's tires and taking of paint scrapings was a de minimis invasion of constitutional interests).[27] Under these circumstances, the safeguards of a warrant would only minimally advance Fourth Amendment interests. This warrantless "seizure" was reasonable.[28] *126 In sum, the federal agents did not infringe any constitutionally protected privacy interest that had not already been frustrated as the result of private conduct. To the extent that a protected possessory interest was infringed, the infringement was de minimis and constitutionally reasonable. The judgment of the Court of Appeals is Reversed. JUSTICE WHITE, concurring in part and concurring in the judgment. |
Justice Marshall | majority | false | Quilloin v. Walcott | 1978-03-06T00:00:00 | null | https://www.courtlistener.com/opinion/109760/quilloin-v-walcott/ | https://www.courtlistener.com/api/rest/v3/clusters/109760/ | 1,978 | 1977-021 | 1 | 9 | 0 | The issue in this case is the constitutionality of Georgia's adoption laws as applied to deny an unwed father authority to prevent adoption of his illegitimate child. The child was born in December 1964 and has been in the custody and control of his mother, appellee Ardell Williams Walcott, for his entire life. The mother and the child's natural father, appellant Leon Webster Quilloin, never married each other or established a home together, and in September 1967 the mother married appellee Randall Walcott.[1] In March 1976, she consented to adoption of the child by her husband, who immediately filed a petition for adoption. Appellant attempted to block the adoption and to secure visitation rights, but he did not seek custody or object to the child's continuing to live with appellees. Although appellant was not found to be an unfit parent, the adoption was granted over his objection.
In Stanley v. Illinois, 405 U.S. 645 (1972), this Court held that the State of Illinois was barred, as a matter of both due process and equal protection, from taking custody of the children of an unwed father, absent a hearing and a particularized *248 finding that the father was an unfit parent. The Court concluded, on the one hand, that a father's interest in the "companionship, care, custody, and management" of his children is "cognizable and substantial," id., at 651-652, and, on the other hand, that the State's interest in caring for the children is "de minimis" if the father is in fact a fit parent, id., at 657-658. Stanley left unresolved the degree of protection a State must afford to the rights of an unwed father in a situation, such as that presented here, in which the countervailing interests are more substantial.
I
Generally speaking, under Georgia law a child born in wedlock cannot be adopted without the consent of each living parent who has not voluntarily surrendered rights in the child or been adjudicated an unfit parent.[2] Even where the child's parents are divorced or separated at the time of the adoption proceedings, either parent may veto the adoption. In contrast, only the consent of the mother is required for adoption of an illegitimate child. Ga. Code § 74-403 (3) (1975).[3] To *249 acquire the same veto authority possessed by other parents, the father of a child born out of wedlock must legitimate his offspring, either by marrying the mother and acknowledging the child as his own, § 74-101, or by obtaining a court order declaring the child legitimate and capable of inheriting from the father, § 74-103.[4] But unless and until the child is legitimated, the mother is the only recognized parent and is given exclusive authority to exercise all parental prerogatives, § 74-203,[5] including the power to veto adoption of the child.
Appellant did not petition for legitimation of his child at any time during the 11 years between the child's birth and the filing of Randall Walcott's adoption petition.[6] However, in *250 response to Walcott's petition, appellant filed an application for a writ of habeas corpus seeking visitation rights, a petition for legitimation, and an objection to the adoption.[7] Shortly thereafter, appellant amended his pleadings by adding the claim that §§ 74-203 and 74-403 (3) were unconstitutional as applied to his case, insofar as they denied him the rights granted to married parents, and presumed unwed fathers to be unfit as a matter of law.
The petitions for adoption, legitimation, and writ of habeas corpus were consolidated for trial in the Superior Court of Fulton County, Ga. The court expressly stated that these matters were being tried on the basis of a consolidated record to allow "the biological father . . . a right to be heard with respect to any issue or other thing upon which he desire[s] to be heard, including his fitness as a parent . . . ."[8] After receiving extensive testimony from the parties and other witnesses, *251 the trial court found that, although the child had never been abandoned or deprived, appellant had provided support only on an irregular basis.[9] Moreover, while the child previously had visited with appellant on "many occasions," and had been given toys and gifts by appellant "from time to time," the mother had recently concluded that these contacts were having a disruptive effect on the child and on appellees' entire family.[10] The child himself expressed a desire to be adopted by Randall Walcott and to take on Walcott's name,[11] and the court found Walcott to be a fit and proper person to adopt the child.
On the basis of these findings, as well as findings relating to appellees' marriage and the mother's custody of the child for all of the child's life, the trial court determined that the proposed adoption was in the "best interests of [the] child." The court concluded, further, that granting either the legitimation or the visitation rights requested by appellant would not be in the "best interests of the child," and that both should consequently be denied. The court then applied §§ 74-203 and 74-403 (3) to the situation at hand, and, since appellant had failed to obtain a court order granting legitimation, he was found to lack standing to object to the adoption. *252 Ruling that appellant's constitutional claims were without merit, the court granted the adoption petition and denied the legitimation and visitation petitions.
Appellant took an appeal to the Supreme Court of Georgia, claiming that §§ 74-203 and 74-403 (3), as applied by the trial court to his case, violated the Equal Protection and Due Process Clauses of the Fourteenth Amendment. In particular, appellant contended that he was entitled to the same power to veto an adoption as is provided under Georgia law to married or divorced parents and to unwed mothers, and, since the trial court did not make a finding of abandonment or other unfitness on the part of appellant, see n. 2, supra, the adoption of his child should not have been allowed.
Over a dissent which urged that § 74-403 (3) was invalid under Stanley v. Illinois, the Georgia Supreme Court affirmed the decision of the trial court. 238 Ga. 230, 232 S.E.2d 246 (1977).[12] The majority relied generally on the strong state policy of rearing children in a family setting, a policy which in the court's view might be thwarted if unwed fathers were required to consent to adoptions. The court also emphasized the special force of this policy under the facts of this case, pointing out that the adoption was sought by the child's stepfather, who was part of the family unit in which the child was *253 in fact living, and that the child's natural father had not taken steps to support or legitimate the child over a period of more than 11 years. The court noted in addition that, unlike the father in Stanley, appellant had never been a de facto member of the child's family unit.
Appellant brought this appeal pursuant to 28 U.S. C. § 1257 (2), continuing to challenge the constitutionality of §§ 74-203 and 74-403 (3) as applied to his case, and claiming that he was entitled as a matter of due process and equal protection to an absolute veto over adoption of his child, absent a finding of his unfitness as a parent. In contrast to appellant's somewhat broader statement of the issue in the Georgia Supreme Court, on this appeal he focused his equal protection claim solely on the disparate statutory treatment of his case and that of a married father.[13] We noted probable jurisdiction, 431 U.S. 937 (1977), and we now affirm.
II
At the outset, we observe that appellant does not challenge the sufficiency of the notice he received with respect to the adoption proceeding, see n. 7, supra, nor can he claim that he was deprived of a right to a hearing on his individualized interests in his child, prior to entry of the order of adoption. Although the trial court's ultimate conclusion was that appellant lacked standing to object to the adoption, this conclusion was reached only after appellant had been afforded a full hearing on his legitimation petition, at which he was given the opportunity to offer evidence on any matter he thought relevant, including his fitness as a parent. Had the trial court *254 granted legitimation, appellant would have acquired the veto authority he is now seeking.
The fact that appellant was provided with a hearing on his legitimation petition is not, however, a complete answer to his attack on the constitutionality of §§ 74-203 and 74-403 (3). The trial court denied appellant's petition, and thereby precluded him from gaining veto authority, on the ground that legitimation was not in the "best interests of the child"; appellant contends that he was entitled to recognition and preservation of his parental rights absent a showing of his "unfitness." Thus, the underlying issue is whether, in the circumstances of this case and in light of the authority granted by Georgia law to married fathers, appellant's interests were adequately protected by a "best interests of the child" standard. We examine this issue first under the Due Process Clause and then under the Equal Protection Clause.
A
Appellees suggest that due process was not violated, regardless of the standard applied by the trial court, since any constitutionally protected interest appellant might have had was lost by his failure to petition for legitimation during the 11 years prior to filing of Randall Walcott's adoption petition. We would hesitate to rest decision on this ground, in light of the evidence in the record that appellant was not aware of the legitimation procedure until after the adoption petition was filed.[14] But in any event we need not go that far, since under the circumstances of this case appellant's substantive rights were not violated by application of a "best interests of the child" standard.
*255 We have recognized on numerous occasions that the relationship between parent and child is constitutionally protected. See, e. g., Wisconsin v. Yoder, 406 U.S. 205, 231-233 (1972); Stanley v. Illinois, supra; Meyer v. Nebraska, 262 U.S. 390, 399-401 (1923). "It is cardinal with us that the custody, care and nurture of the child reside first in the parents, whose primary function and freedom include preparation for obligations the state can neither supply nor hinder." Prince v. Massachusetts, 321 U.S. 158, 166 (1944). And it is now firmly established that "freedom of personal choice in matters of . . . family life is one of the liberties protected by the Due Process Clause of the Fourteenth Amendment." Cleveland Board of Education v. LaFleur, 414 U.S. 632, 639-640 (1974).
We have little doubt that the Due Process Clause would be offended "[i]f a State were to attempt to force the breakup of a natural family, over the objections of the parents and their children, without some showing of unfitness and for the sole reason that to do so was thought to be in the children's best interest." Smith v. Organization of Foster Families, 431 U.S. 816, 862-863 (1977) (STEWART, J., concurring in judgment). But this is not a case in which the unwed father at any time had, or sought, actual or legal custody of his child. Nor is this a case in which the proposed adoption would place the child with a new set of parents with whom the child had never before lived. Rather, the result of the adoption in this case is to give full recognition to a family unit already in existence, a result desired by all concerned, except appellant. Whatever might be required in other situations, we cannot say that the State was required in this situation to find anything more than that the adoption, and denial of legitimation, were in the "best interests of the child."
B
Appellant contends that even if he is not entitled to prevail as a matter of due process, principles of equal protection require that his authority to veto an adoption be measured by *256 the same standard that would have been applied to a married father. In particular, appellant asserts that his interests are indistinguishable from those of a married father who is separated or divorced from the mother and is no longer living with his child, and therefore the State acted impermissibly in treating his case differently. We think appellant's interests are readily distinguishable from those of a separated or divorced father, and accordingly believe that the State could permissibly give appellant less veto authority than it provides to a married father.
Although appellant was subject, for the years prior to these proceedings, to essentially the same child-support obligation as a married father would have had, compare § 74-202 with § 74-105 and § 30-301, he has never exercised actual or legal custody over his child, and thus has never shouldered any significant responsibility with respect to the daily supervision, education, protection, or care of the child. Appellant does not complain of his exemption from these responsibilities and, indeed, he does not even now seek custody of his child. In contrast, legal custody of children is, of course, a central aspect of the marital relationship, and even a father whose marriage has broken apart will have borne full responsibility for the rearing of his children during the period of the marriage. Under any standard of review, the State was not foreclosed from recognizing this difference in the extent of commitment to the welfare of the child.
For these reasons, we conclude that §§ 74-203 and 74-403 (3), as applied in this case, did not deprive appellant of his asserted rights under the Due Process and Equal Protection Clauses. The judgment of the Supreme Court of Georgia is, accordingly,
Affirmed.
| The issue in this case is the constitutionality of Georgia's adoption laws as applied to deny an unwed father authority to prevent adoption of his illegitimate child. The child was born in December 1964 and has been in the custody and control of his mother, appellee Ardell Williams Walcott, for his entire life. The mother and the child's natural father, appellant Leon Webster Quilloin, never married each other or established a home together, and in September 196 the mother married appellee Randall Walcott.[1] In March 196, she consented to adoption of the child by her husband, who immediately filed a petition for adoption. Appellant attempted to block the adoption and to secure visitation rights, but he did not seek custody or object to the child's continuing to live with appellees. Although appellant was not found to be an unfit parent, the adoption was granted over his objection. In this Court held that the State of was barred, as a matter of both due process and equal protection, from taking custody of the children of an unwed father, absent a hearing and a particularized *48 finding that the father was an unfit parent. The Court concluded, on the one hand, that a father's interest in the "companionship, care, custody, and management" of his children is "cognizable and substantial," and, on the other hand, that the State's interest in caring for the children is "de minimis" if the father is in fact a fit parent, Stanley left unresolved the degree of protection a State must afford to the rights of an unwed father in a situation, such as that presented here, in which the countervailing interests are more substantial. I Generally speaking, under Georgia law a child born in wedlock cannot be adopted without the consent of each living parent who has not voluntarily surrendered rights in the child or been adjudicated an unfit parent.[] Even where the child's parents are divorced or separated at the time of the adoption proceedings, either parent may veto the adoption. In contrast, only the consent of the mother is required for adoption of an illegitimate child. Ga. Code 4-403 (3) (195).[3] To *49 acquire the same veto authority possessed by other parents, the father of a child born out of wedlock must legitimate his offspring, either by marrying the mother and acknowledging the child as his own, 4-101, or by obtaining a court order declaring the child legitimate and capable of inheriting from the father, 4-103.[4] But unless and until the child is legitimated, the mother is the only recognized parent and is given exclusive authority to exercise all parental prerogatives, 4-03,[5] including the power to veto adoption of the child. Appellant did not petition for legitimation of his child at any time during the 11 years between the child's birth and the filing of Randall Walcott's adoption petition.[6] However, in *50 response to Walcott's petition, appellant filed an application for a writ of habeas corpus seeking visitation rights, a petition for legitimation, and an objection to the adoption.[] Shortly thereafter, appellant amended his pleadings by adding the claim that 4-03 and 4-403 (3) were unconstitutional as applied to his case, insofar as they denied him the rights granted to married parents, and presumed unwed fathers to be unfit as a matter of law. The petitions for adoption, legitimation, and writ of habeas corpus were consolidated for trial in the Superior Court of Fulton County, Ga. The court expressly stated that these matters were being tried on the basis of a consolidated record to allow "the biological father a right to be heard with respect to any issue or other thing upon which he desire[s] to be heard, including his fitness as a parent"[8] After receiving extensive testimony from the parties and other witnesses, *51 the trial court found that, although the child had never been abandoned or deprived, appellant had provided support only on an irregular basis.[9] Moreover, while the child previously had visited with appellant on "many occasions," and had been given toys and gifts by appellant "from time to time," the mother had recently concluded that these contacts were having a disruptive effect on the child and on appellees' entire family.[10] The child himself expressed a desire to be adopted by Randall Walcott and to take on Walcott's name,[11] and the court found Walcott to be a fit and proper person to adopt the child. On the basis of these findings, as well as findings relating to appellees' marriage and the mother's custody of the child for all of the child's life, the trial court determined that the proposed adoption was in the "best interests of [the] child." The court concluded, further, that granting either the legitimation or the visitation rights requested by appellant would not be in the "best interests of the child," and that both should consequently be denied. The court then applied 4-03 and 4-403 (3) to the situation at hand, and, since appellant had failed to obtain a court order granting legitimation, he was found to lack standing to object to the adoption. *5 Ruling that appellant's constitutional claims were without merit, the court granted the adoption petition and denied the legitimation and visitation petitions. Appellant took an appeal to the Supreme Court of Georgia, claiming that 4-03 and 4-403 (3), as applied by the trial court to his case, violated the Equal Protection and Due Process Clauses of the Fourteenth Amendment. In particular, appellant contended that he was entitled to the same power to veto an adoption as is provided under Georgia law to married or divorced parents and to unwed mothers, and, since the trial court did not make a finding of abandonment or other unfitness on the part of appellant, see n. the adoption of his child should not have been allowed. Over a dissent which urged that 4-403 (3) was invalid under the Georgia Supreme Court affirmed the decision of the trial court. 38 Ga. 30, 3 S.E.d 46[1] The majority relied generally on the strong state policy of rearing children in a family setting, a policy which in the court's view might be thwarted if unwed fathers were required to consent to adoptions. The court also emphasized the special force of this policy under the facts of this case, pointing out that the adoption was sought by the child's stepfather, who was part of the family unit in which the child was *53 in fact living, and that the child's natural father had not taken steps to support or legitimate the child over a period of more than 11 years. The court noted in addition that, unlike the father in Stanley, appellant had never been a de facto member of the child's family unit. Appellant brought this appeal pursuant to 8 U.S. C. 15 (), continuing to challenge the constitutionality of 4-03 and 4-403 (3) as applied to his case, and claiming that he was entitled as a matter of due process and equal protection to an absolute veto over adoption of his child, absent a finding of his unfitness as a parent. In contrast to appellant's somewhat broader statement of the issue in the Georgia Supreme Court, on this appeal he focused his equal protection claim solely on the disparate statutory treatment of his case and that of a married father.[13] We noted probable jurisdiction, and we now affirm. II At the outset, we observe that appellant does not challenge the sufficiency of the notice he received with respect to the adoption proceeding, see n. nor can he claim that he was deprived of a right to a hearing on his individualized interests in his child, prior to entry of the order of adoption. Although the trial court's ultimate conclusion was that appellant lacked standing to object to the adoption, this conclusion was reached only after appellant had been afforded a full hearing on his legitimation petition, at which he was given the opportunity to offer evidence on any matter he thought relevant, including his fitness as a parent. Had the trial court *54 granted legitimation, appellant would have acquired the veto authority he is now seeking. The fact that appellant was provided with a hearing on his legitimation petition is not, however, a complete answer to his attack on the constitutionality of 4-03 and 4-403 (3). The trial court denied appellant's petition, and thereby precluded him from gaining veto authority, on the ground that legitimation was not in the "best interests of the child"; appellant contends that he was entitled to recognition and preservation of his parental rights absent a showing of his "unfitness." Thus, the underlying issue is whether, in the circumstances of this case and in light of the authority granted by Georgia law to married fathers, appellant's interests were adequately protected by a "best interests of the child" standard. We examine this issue first under the Due Process Clause and then under the Equal Protection Clause. A Appellees suggest that due process was not violated, regardless of the standard applied by the trial court, since any constitutionally protected interest appellant might have had was lost by his failure to petition for legitimation during the 11 years prior to filing of Randall Walcott's adoption petition. We would hesitate to rest decision on this ground, in light of the evidence in the record that appellant was not aware of the legitimation procedure until after the adoption petition was filed.[14] But in any event we need not go that far, since under the circumstances of this case appellant's substantive rights were not violated by application of a "best interests of the child" standard. *55 We have recognized on numerous occasions that the relationship between parent and child is constitutionally protected. See, e. g., 406 U.S. 05, 31-33 ; 6 U.S. 390, (193). "It is cardinal with us that the custody, care and nurture of the child reside first in the parents, whose primary function and freedom include preparation for obligations the state can neither supply nor hinder." 31 U.S. 158, And it is now firmly established that "freedom of personal choice in matters of family life is one of the liberties protected by the Due Process Clause of the Fourteenth Amendment." Cleveland Board of 414 U.S. 63, (194). We have little doubt that the Due Process Clause would be offended "[i]f a State were to attempt to force the breakup of a natural family, over the objections of the parents and their children, without some showing of unfitness and for the sole reason that to do so was thought to be in the children's best interest." 86-863 But this is not a case in which the unwed father at any time had, or sought, actual or legal custody of his child. Nor is this a case in which the proposed adoption would place the child with a new set of parents with whom the child had never before lived. Rather, the result of the adoption in this case is to give full recognition to a family unit already in existence, a result desired by all concerned, except appellant. Whatever might be required in other situations, we cannot say that the State was required in this situation to find anything more than that the adoption, and denial of legitimation, were in the "best interests of the child." B Appellant contends that even if he is not entitled to prevail as a matter of due process, principles of equal protection require that his authority to veto an adoption be measured by *56 the same standard that would have been applied to a married father. In particular, appellant asserts that his interests are indistinguishable from those of a married father who is separated or divorced from the mother and is no longer living with his child, and therefore the State acted impermissibly in treating his case differently. We think appellant's interests are readily distinguishable from those of a separated or divorced father, and accordingly believe that the State could permissibly give appellant less veto authority than it provides to a married father. Although appellant was subject, for the years prior to these proceedings, to essentially the same child-support obligation as a married father would have had, compare 4-0 with 4-105 and 30-301, he has never exercised actual or legal custody over his child, and thus has never shouldered any significant responsibility with respect to the daily supervision, education, protection, or care of the child. Appellant does not complain of his exemption from these responsibilities and, indeed, he does not even now seek custody of his child. In contrast, legal custody of children is, of course, a central aspect of the marital relationship, and even a father whose marriage has broken apart will have borne full responsibility for the rearing of his children during the period of the marriage. Under any standard of review, the State was not foreclosed from recognizing this difference in the extent of commitment to the welfare of the child. For these reasons, we conclude that 4-03 and 4-403 (3), as applied in this case, did not deprive appellant of his asserted rights under the Due Process and Equal Protection Clauses. The judgment of the Supreme Court of Georgia is, accordingly, Affirmed. |
Justice White | majority | false | United States v. Ojeda Rios | 1990-04-30T00:00:00 | null | https://www.courtlistener.com/opinion/112421/united-states-v-ojeda-rios/ | https://www.courtlistener.com/api/rest/v3/clusters/112421/ | 1,990 | 1989-072 | 1 | 6 | 3 | This case arises under Title III of the Omnibus Crime Control and Safe Streets Act of 1968 (Title III), as amended, 18 U.S. C. § 2510 et seq., which regulates the interception of wire, oral, and electronic communications. Except under extraordinary circumstances, see § 2518(7), electronic surveillance may be conducted only pursuant to a court order. See §§ 2518(1)-(6). Section 2518(8)(a) requires that "[t]he contents of any wire, oral, or electronic communication intercepted by any means authorized by this chapter shall, if possible, be recorded on tape or wire or other comparable device" and that recording "shall be done in such way as will protect the recording from editing or other alterations." The section further provides that "[i]mmediately upon the expiration of the period of the order, or extensions thereof, such recordings shall be made available to the judge issuing *260 such order and sealed under his directions." Section 2518(8) (a) has an explicit exclusionary remedy[1] for noncompliance with the sealing requirement, providing that "[t]he presence of the seal provided for by this subsection, or a satisfactory explanation for the absence thereof, shall be a prerequisite for the use or disclosure of the contents of any wire, oral, or electronic communication or evidence derived therefrom under subsection (3) of section 2517."[2]
In this case, a series of court orders authorized electronic surveillance. The tapes later offered in evidence bore seals but the seals on the tapes at issue had not been immediately attached as required by the statute. The issue we address is whether § 2518(8)(a) requires suppression of those tapes.
Respondents are members of a Puerto Rican organization known as Los Macheteros (the "machete wielders"). All have been charged with federal crimes relating to the robbery in 1983 of a Wells Fargo depot in Connecticut, a robbery which netted approximately $7 million. The Government first began investigating respondents in connection with a rocket attack on the United States Courthouse in Hato Rey, Puerto Rico. Effective April 27, 1984, the Government obtained an order of electronic surveillance for the residence of Filiberto Ojeda Rios in Levittown, Puerto Rico, and for some public telephones near the residence. During its investigation of the rocket attack, the Government discovered evidence *261 indicating that respondents had been involved in the Wells Fargo depot robbery. The Government obtained two extensions of the April 27 surveillance order, with the final extension expiring on July 23, 1984. The Government actually terminated surveillance at the Levittown residence and public telephones on July 9, 1984, when Ojeda Rios moved to an apartment in El Cortijo, a community adjacent to Levittown. On July 27, 1984, the Government obtained a new surveillance order covering Ojeda Rios' El Cortijo residence. After extensions, that order expired on September 24, 1984. Another surveillance order authorizing surveillance of Ojeda Rios' car, originally entered on May 11, 1984, was extended and finally expired on October 10, 1984. All tapes created during the surveillance of Ojeda Rios were sealed by the United States District Court for the District of Puerto Rico on October 13, 1984.
As part of the Wells Fargo robbery investigation, the Government obtained a court order on November 1, 1984, authorizing it to wiretap a residence shared by Juan Segarra Palmer and Luz Berrios Berrios in Vega Baja, Puerto Rico. The District Court extended that authorization order each month for seven months, with the last extension expiring on May 30, 1985. The Government also obtained a court order authorizing it to wiretap two public telephones in Vega Baja, effective January 18, 1985. That order expired on February 17, 1985, and due to difficulties in finishing the affidavit necessary to obtain an extension, the Government did not apply for an extension until March 1, 1985. The District Court issued a new order on that date. The order was thereafter extended twice and finally expired on May 30, 1985. All tapes from the Vega Baja wiretaps were judicially sealed on June 15, 1985.
After respondents were indicted for various offenses relating to the Wells Fargo depot robbery, they moved to suppress all evidence the Government had obtained as a result of electronic surveillance. Following a suppression hearing, *262 the United States District Court for the District of Connecticut refused to suppress the El Cortijo and Vega Baja residence tapes, but suppressed the Levittown tapes and the public telephone tapes made in Vega Baja. 695 F. Supp. 649 (1988). In doing so, the District Court determined that the July 27, 1984, order authorizing the wiretap at the El Cortijo residence was not an extension of the April 27, 1984, order authorizing the Levittown wiretaps and, therefore, the obligation to seal the Levittown tapes arose when the last extension of the April 27 order expired on July 23, 1984. The court calculated that there had been at least an 82-day delay in sealing the Levittown tapes. With respect to the public telephone wiretaps in Vega Baja, the court determined that the March 1, 1985, order could not be considered an extension of the initial January 18, 1985, order which had expired on February 17, 1985 because of the 12-day delay in seeking reauthorization of the January 18 order and the Government's failure to satisfactorily explain that delay. The court calculated that the sealing of the tapes on June 15, 1985, occurred 118 days after the order which authorized the surveillance had expired. Without determining the authenticity of these two sets of tapes, the District Court suppressed them on the basis of the delay alone.
The United States Court of Appeals for the Second Circuit affirmed the suppression of the tapes, 875 F.2d 17 (1989), rejecting the Government's explanation for the sealing delays. Because the scope and role of the sealing provision of Title III has generated disagreement in the lower courts, we granted certiorari, 493 U.S. 889 (1989), and now vacate and remand.
The Government first argues that because § 2518(8)(a) states that as a prerequisite to admissibility, electronic surveillance tapes must either bear a seal or the Government must provide a "satisfactory explanation" for the "absence" of a seal, the "satisfactory explanation" requirement does not apply where the tapes to be offered in evidence actually bear *263 a seal, regardless of when or why the seal was applied. This argument is unpersuasive. The narrow reading suggested by the Government is not a plausible interpretation of congressional intent when the terms and purpose of § 2518(8)(a) are considered as a whole. The section begins with the command that tapes shall be sealed "immediately" upon expiration of the underlying surveillance order and then, prior to the clause relied upon by the Government, provides that "the seal provided for by this subsection" (emphasis added) is a prerequisite to the admissibility of electronic surveillance tapes. The clear import of these provisions is that the seal required by § 2518(8)(a) is not just any seal but a seal that has been obtained immediately upon expiration of the underlying surveillance order. The "absence" the Government must satisfactorily explain encompasses not only the total absence of a seal but also the absence of a timely applied seal. Contrary to what is so plainly required by § 2518(8)(a), the Government would have us nullify the immediacy aspect of the sealing requirement.
The primary thrust of § 2518(8)(a), see S. Rep. No. 1097, 90th Cong., 2d Sess., 105 (1968), and a congressional purpose embodied in Title III in general, see, e. g., United States v. Giordano, 416 U.S. 505, 515 (1974), is to ensure the reliability and integrity of evidence obtained by means of electronic surveillance. The presence or absence of a seal does not in itself establish the integrity of electronic surveillance tapes. Rather, the seal is a means of ensuring that subsequent to its placement on a tape, the Government has no opportunity to tamper with, alter, or edit the conversations that have been recorded. It is clear to us that Congress viewed the sealing requirement as important precisely because it limits the Government's opportunity to alter the recordings.
The Government's view of the statute would create the anomalous result that the prosecution could delay requesting a seal for months, perhaps even until a few days before trial, without risking a substantial penalty. Since it is likely that a *264 district court would automatically seal the tapes,[3] there would be no "absence" of a seal, in the sense suggested by the Government, and § 2518(8)(a) would not come into play, even though the tapes would have been exposed to alteration or editing for an extended period of time. Such a view of the statute ignores the purposes of the sealing provision and is too strained a reading of the statutory language to withstand scrutiny. Like every Court of Appeals that has considered the question, we conclude that § 2518(8)(a) applies to a delay in sealing, as well as to a complete failure to seal, tapes.[4]
The Government's second contention is that even if § 2518 (8)(a)'s "satisfactory explanation" requirement applies to delays in sealing tapes, it is satisfied if the Government first explains why the delay occurred and then demonstrates that the tapes are authentic. This submission, however, also is not a sensible construction of the language of § 2518(8)(a) and would essentially nullify the function of the sealing requirement as a safeguard against tampering. The statute requires a satisfactory explanation, not just an explanation. It is difficult to imagine a situation in which the Government could not explain why it delayed in seeking to have tapes sealed. Even deliberate delay would be enough, so long as the Government could establish the integrity of the tapes; yet deliberate delay could hardly be called a satisfactory explanation. To hold that proof of nontampering is a substitute for a *265 satisfactory explanation is foreclosed by the plain words of the sealing provision.
It is true that offering to prove that tapes are authentic would be consistent with Congress' concern about tampering,[5] but even if we were confident that tampering could always be easily detected, we would not be at liberty to agree with the Government, for it is obvious that Congress had another view when it imposed the sealing safeguard.
The Government contends that it has an incentive to seal tapes immediately because otherwise, even under its proposed test, it will face lengthy pretrial suppression hearings in which it must establish the authenticity of tape recorded conversations. This is no more than a statement that only rarely would there be a delay and does not answer the issue posed where there is a delay that is not satisfactorily explained. Furthermore, the incentive argument is suspect since timely sealing, as the Government concedes, Tr. of Oral Arg. 10-11, 22-23, does not foreclose a challenge to authenticity, which in any event would require lengthy proceedings.
We conclude that the "satisfactory explanation" language in § 2518(8)(a) must be understood to require that the Government explain not only why a delay occurred but also why it is excusable. This approach surely is more consistent with the language and purpose of § 2518(8)(a).
Finally, we must consider whether the Government established good cause for the sealing delays that occurred in this case. The Government contends in this Court that its delays were the result of a good-faith, objectively reasonable misunderstanding of the statutory term "extension." According to *266 the Government, the attorney supervising the investigation and electronic surveillance of respondents believed that he was not required to seek sealing of the tapes until there was a meaningful hiatus in the investigation as a whole. In arguing that this understanding of the law was objectively reasonable, the Government relies primarily on two Second Circuit cases interpreting the statutory term "extension."
In one case, the Second Circuit held that an electronic surveillance order that was entered at least 16 days after a prior order had expired was to be regarded as an "extension" within the meaning of § 2518 because it "was clearly part of the same investigation of the same individuals conducting the same criminal enterprise" as was being investigated under the prior order. United States v. Principie, 531 F.2d 1132, 1142, and n. 14 (1976), cert. denied, 430 U.S. 905 (1977). In a subsequent case, again involving a gap between the expiration of an order and an "extension," the court indicated that under the circumstances presented later orders could be deemed extensions of prior ones and stated that where an "intercept is of the same premises and involves substantially the same persons, an extension under these circumstances requires sealing only at the conclusion of the whole surveillance." United States v. Scafidi, 564 F.2d 633, 641 (1977), cert. denied, 436 U.S. 903 (1978).
These cases do not establish that the Government's asserted understanding of the law in this case was correct; indeed, the Second Circuit's decision in this case indicates the contrary, but the cases do support the conclusion that the "extension" theory now pressed upon us was objectively reasonable at the time of the delays. Thus, we conclude that the excuse now advanced by the Government is objectively reasonable. In establishing a reasonable excuse for a sealing delay, the Government is not required to prove that a particular understanding of the law is correct but rather only that its interpretation was objectively reasonable at the time. To the extent the Second Circuit in this case required an absolutely *267 correct interpretation of the law, we think it held the Government to too strict a standard.
Nevertheless, we must remand this case for further proceedings. A "satisfactory explanation" within the meaning of § 2518(8)(a) cannot merely be a reasonable excuse for the delay presented at the appellate level. Rather, our review of the sufficiency of the Government's explanation for a delay should be based on the evidence presented and submissions made in the District Court. Therein lies the problem in this case. Whether the supervising attorney actually advanced the Government's "extension" theory in the District Court is not clear. Compare App. 4-5 (no sealing required for an ongoing investigation until a "meaningful hiatus" occurred), and id., at 26-27 (same), with id., at 36 (separate orders viewed as extensions of an interrelated investigation), and id., at 40 (same). Thus, even though the misunderstanding now pressed by the Government was objectively reasonable, that explanation is not "satisfactory" within the meaning of the statute unless it was relied on at the suppression hearing to explain the sealing delays. Because the Second Circuit did not address this threshold question, the case must be remanded for a determination whether the Government's explanation to the District Court substantially corresponds to the explanation it now advances.
The judgment of the United States Court of Appeals for the Second Circuit is vacated, and the case is remanded for further proceedings consistent with this opinion.
It is so ordered. | This case arises under Title III of the Omnibus Crime Control and Safe Streets Act of 1968 (Title III), as amended, 18 U.S. C. 2510 et seq., which regulates the interception of wire, oral, and electronic communications. Except under extraordinary circumstances, see 2518(7), electronic surveillance may be conducted only pursuant to a court order. See 2518(1)-(6). Section 2518(8)(a) requires that "[t]he contents of any wire, oral, or electronic communication intercepted by any means authorized by this chapter shall, if possible, be recorded on tape or wire or other comparable device" and that recording "shall be done in such way as will protect the recording from editing or other alterations." The section further provides that "[i]mmediately upon the expiration of the period of the order, or extensions thereof, such recordings shall be made available to the judge issuing *260 such order and sealed under his directions." Section 2518(8) (a) has an explicit exclusionary remedy[1] for noncompliance with the sealing requirement, providing that "[t]he presence of the seal provided for by this subsection, or a satisfactory explanation for the absence thereof, shall be a prerequisite for the use or disclosure of the contents of any wire, oral, or electronic communication or evidence derived therefrom under subsection (3) of section 2517."[2] In this case, a series of court orders authorized electronic surveillance. The tapes later offered in evidence bore seals but the seals on the tapes at issue had not been immediately attached as required by the statute. The issue we address is whether 2518(8)(a) requires suppression of those tapes. Respondents are members of a Puerto Rican organization known as Los Macheteros (the "machete wielders"). All have been charged with federal crimes relating to the robbery in 1983 of a Wells Fargo depot in Connecticut, a robbery which netted approximately $7 million. The Government first began investigating respondents in connection with a rocket attack on the United States Courthouse in Hato Rey, Puerto Rico. Effective April 27, 1984, the Government obtained an order of electronic surveillance for the residence of Filiberto Ojeda Rios in Levittown, Puerto Rico, and for some public telephones near the residence. During its investigation of the rocket attack, the Government discovered evidence *261 indicating that respondents had been involved in the Wells Fargo depot robbery. The Government obtained two extensions of the April 27 surveillance order, with the final extension expiring on July 23, 1984. The Government actually terminated surveillance at the Levittown residence and public telephones on July 9, 1984, when Ojeda Rios moved to an apartment in El Cortijo, a community adjacent to Levittown. On July 27, 1984, the Government obtained a new surveillance order covering Ojeda Rios' El Cortijo residence. After extensions, that order expired on September 24, 1984. Another surveillance order authorizing surveillance of Ojeda Rios' car, originally entered on May 11, 1984, was extended and finally expired on October 10, 1984. All tapes created during the surveillance of Ojeda Rios were sealed by the United States District Court for the District of Puerto Rico on October 13, 1984. As part of the Wells Fargo robbery investigation, the Government obtained a court order on November 1, 1984, authorizing it to wiretap a residence shared by Juan Segarra Palmer and Luz Berrios Berrios in Vega Baja, Puerto Rico. The District Court extended that authorization order each month for seven months, with the last extension expiring on May 30, 1985. The Government also obtained a court order authorizing it to wiretap two public telephones in Vega Baja, effective January 18, 1985. That order expired on February 17, 1985, and due to difficulties in finishing the affidavit necessary to obtain an extension, the Government did not apply for an extension until March 1, 1985. The District Court issued a new order on that date. The order was thereafter extended twice and finally expired on May 30, 1985. All tapes from the Vega Baja wiretaps were judicially sealed on June 15, 1985. After respondents were indicted for various offenses relating to the Wells Fargo depot robbery, they moved to suppress all evidence the Government had obtained as a result of electronic surveillance. Following a suppression hearing, *262 the United States District Court for the District of Connecticut refused to suppress the El Cortijo and Vega Baja residence tapes, but suppressed the Levittown tapes and the public telephone tapes made in Vega Baja. In doing so, the District Court determined that the July 27, 1984, order authorizing the wiretap at the El Cortijo residence was not an extension of the April 27, 1984, order authorizing the Levittown wiretaps and, therefore, the obligation to seal the Levittown tapes arose when the last extension of the April 27 order expired on July 23, 1984. The court calculated that there had been at least an 82-day delay in sealing the Levittown tapes. With respect to the public telephone wiretaps in Vega Baja, the court determined that the March 1, 1985, order could not be considered an extension of the initial January 18, 1985, order which had expired on February 17, 1985 because of the 12-day delay in seeking reauthorization of the January 18 order and the Government's failure to satisfactorily explain that delay. The court calculated that the sealing of the tapes on June 15, 1985, occurred 118 days after the order which authorized the surveillance had expired. Without determining the authenticity of these two sets of tapes, the District Court suppressed them on the basis of the delay alone. The United States Court of Appeals for the Second Circuit affirmed the suppression of the tapes, rejecting the Government's explanation for the sealing delays. Because the scope and role of the sealing provision of Title III has generated disagreement in the lower courts, we granted certiorari, and now vacate and remand. The Government first argues that because 2518(8)(a) states that as a prerequisite to admissibility, electronic surveillance tapes must either bear a seal or the Government must provide a "satisfactory explanation" for the "absence" of a seal, the "satisfactory explanation" requirement does not apply where the tapes to be offered in evidence actually bear *263 a seal, regardless of when or why the seal was applied. This argument is unpersuasive. The narrow reading suggested by the Government is not a plausible interpretation of congressional intent when the terms and purpose of 2518(8)(a) are considered as a whole. The section begins with the command that tapes shall be sealed "immediately" upon expiration of the underlying surveillance order and then, prior to the clause relied upon by the Government, provides that "the seal provided for by this subsection" (emphasis added) is a prerequisite to the admissibility of electronic surveillance tapes. The clear import of these provisions is that the seal required by 2518(8)(a) is not just any seal but a seal that has been obtained immediately upon expiration of the underlying surveillance order. The "absence" the Government must satisfactorily explain encompasses not only the total absence of a seal but also the absence of a timely applied seal. Contrary to what is so plainly required by 2518(8)(a), the Government would have us nullify the immediacy aspect of the sealing requirement. The primary thrust of 2518(8)(a), see S. Rep. No. 1097, 90th Cong., 2d Sess., 105 (1968), and a congressional purpose embodied in Title III in general, see, e. g., United is to ensure the reliability and integrity of evidence obtained by means of electronic surveillance. The presence or absence of a seal does not in itself establish the integrity of electronic surveillance tapes. Rather, the seal is a means of ensuring that subsequent to its placement on a tape, the Government has no opportunity to tamper with, alter, or edit the conversations that have been recorded. It is clear to us that Congress viewed the sealing requirement as important precisely because it limits the Government's opportunity to alter the recordings. The Government's view of the statute would create the anomalous result that the prosecution could delay requesting a seal for months, perhaps even until a few days before trial, without risking a substantial penalty. Since it is likely that a *264 district court would automatically seal the tapes,[3] there would be no "absence" of a seal, in the sense suggested by the Government, and 2518(8)(a) would not come into play, even though the tapes would have been exposed to alteration or editing for an extended period of time. Such a view of the statute ignores the purposes of the sealing provision and is too strained a reading of the statutory language to withstand scrutiny. Like every Court of Appeals that has considered the question, we conclude that 2518(8)(a) applies to a delay in sealing, as well as to a complete failure to seal, tapes.[4] The Government's second contention is that even if 2518 (8)(a)'s "satisfactory explanation" requirement applies to delays in sealing tapes, it is satisfied if the Government first explains why the delay occurred and then demonstrates that the tapes are authentic. This submission, however, also is not a sensible construction of the language of 2518(8)(a) and would essentially nullify the function of the sealing requirement as a safeguard against tampering. The statute requires a satisfactory explanation, not just an explanation. It is difficult to imagine a situation in which the Government could not explain why it delayed in seeking to have tapes sealed. Even deliberate delay would be enough, so long as the Government could establish the integrity of the tapes; yet deliberate delay could hardly be called a satisfactory explanation. To hold that proof of nontampering is a substitute for a *265 satisfactory explanation is foreclosed by the plain words of the sealing provision. It is true that offering to prove that tapes are authentic would be consistent with Congress' concern about tampering,[5] but even if we were confident that tampering could always be easily detected, we would not be at liberty to agree with the Government, for it is obvious that Congress had another view when it imposed the sealing safeguard. The Government contends that it has an incentive to seal tapes immediately because otherwise, even under its proposed test, it will face lengthy pretrial suppression hearings in which it must establish the authenticity of tape recorded conversations. This is no more than a statement that only rarely would there be a delay and does not answer the issue posed where there is a delay that is not satisfactorily explained. Furthermore, the incentive argument is suspect since timely sealing, as the Government concedes, Tr. of Oral Arg. 10-11, 22-23, does not foreclose a challenge to authenticity, which in any event would require lengthy proceedings. We conclude that the "satisfactory explanation" language in 2518(8)(a) must be understood to require that the Government explain not only why a delay occurred but also why it is excusable. This approach surely is more consistent with the language and purpose of 2518(8)(a). Finally, we must consider whether the Government established good cause for the sealing delays that occurred in this case. The Government contends in this Court that its delays were the result of a good-faith, objectively reasonable misunderstanding of the statutory term "extension." According to *266 the Government, the attorney supervising the investigation and electronic surveillance of respondents believed that he was not required to seek sealing of the tapes until there was a meaningful hiatus in the investigation as a whole. In arguing that this understanding of the law was objectively reasonable, the Government relies primarily on two Second Circuit cases interpreting the statutory term "extension." In one case, the Second Circuit held that an electronic surveillance order that was entered at least 16 days after a prior order had expired was to be regarded as an "extension" within the meaning of 2518 because it "was clearly part of the same investigation of the same individuals conducting the same criminal enterprise" as was being investigated under the prior order. United cert. denied, In a subsequent case, again involving a gap between the expiration of an order and an "extension," the court indicated that under the circumstances presented later orders could be deemed extensions of prior ones and stated that where an "intercept is of the same premises and involves substantially the same persons, an extension under these circumstances requires sealing only at the conclusion of the whole surveillance." United cert. denied, These cases do not establish that the Government's asserted understanding of the law in this case was correct; indeed, the Second Circuit's decision in this case indicates the contrary, but the cases do support the conclusion that the "extension" theory now pressed upon us was objectively reasonable at the time of the delays. Thus, we conclude that the excuse now advanced by the Government is objectively reasonable. In establishing a reasonable excuse for a sealing delay, the Government is not required to prove that a particular understanding of the law is correct but rather only that its interpretation was objectively reasonable at the time. To the extent the Second Circuit in this case required an absolutely *267 correct interpretation of the law, we think it held the Government to too strict a standard. Nevertheless, we must remand this case for further proceedings. A "satisfactory explanation" within the meaning of 2518(8)(a) cannot merely be a reasonable excuse for the delay presented at the appellate level. Rather, our review of the sufficiency of the Government's explanation for a delay should be based on the evidence presented and submissions made in the District Court. Therein lies the problem in this case. Whether the supervising attorney actually advanced the Government's "extension" theory in the District Court is not clear. Compare App. 4-5 (no sealing required for an ongoing investigation until a "meaningful hiatus" occurred), and with and Thus, even though the misunderstanding now pressed by the Government was objectively reasonable, that explanation is not "satisfactory" within the meaning of the statute unless it was relied on at the suppression hearing to explain the sealing delays. Because the Second Circuit did not address this threshold question, the case must be remanded for a determination whether the Government's explanation to the District Court substantially corresponds to the explanation it now advances. The judgment of the United States Court of Appeals for the Second Circuit is vacated, and the case is remanded for further proceedings consistent with this opinion. It is so ordered. |
Justice Rehnquist | majority | false | United States v. Jenkins | 1975-02-25T00:00:00 | null | https://www.courtlistener.com/opinion/109201/united-states-v-jenkins/ | https://www.courtlistener.com/api/rest/v3/clusters/109201/ | 1,975 | 1974-053 | 2 | 9 | 0 | Respondent Jenkins was indicted and charged with violating § 12 (a) of the Military Selective Service Act, 62 Stat. 622, as amended, 50 U.S. C. App. § 462 (a), for "knowingly refusing and failing to submit to induction into the armed forces of the United States." App. 3. After a bench trial, the District Court "dismissed" the indictment and "discharged" the respondent. 349 F. Supp. 1068, 1073 (EDNY 1972). The Government sought to appeal this ruling pursuant to 18 U.S. C. § 3731,[1] but the *360 Court of Appeals for the Second Circuit dismissed the appeal "for lack of jurisdiction on the ground that the Double Jeopardy clause prohibits further prosecution." 490 F.2d 868, 880 (1973). We granted certiorari in this case and United States v. Wilson, ante, p. 332, also decided today, to consider the application of the Double Jeopardy Clause of the Fifth Amendment to Government appeals in criminal cases. 417 U.S. 908 (1974).
I
Respondent, who had first registered with his local draft board in 1966, was classified 1-A by his local board on November 18, 1970. He was found physically fit for induction, and on February 4, 1971, the local board sent respondent an Order to Report for Induction on February 24, 1971. After consulting an attorney and a local draft counselor, respondent wrote the local board and requested Selective Service Form 150 for a conscientious objector classification. Having received no response from the local board by February 23, the day before he had been ordered to report for induction, respondent went in person to the local board to request Form 150. Although respondent did secure the desired form, local board officials were directed by Selective Service headquarters not to postpone his induction to allow him to complete and submit the conscientious objector form. Respondent did not report for induction on February 24, 1971, and he was subsequently indicted.
Respondent was arraigned on January 13, 1972, and pleaded not guilty. The parties were directed to file all pretrial motions within 45 days, but no pretrial motions *361 were filed within that period. The case was called and continued on several occasions. During this period respondent filed a motion for judgment of acquittal based, in part, on the following ground:
"The failure of the local board to postpone the induction order pending the determination of the defendant's claim as a conscientious objector was arbitrary and contrary to law and rendered the Order to report for induction invalid. United States v. Gearey, 368 F.2d 144 (2nd Cir. 1966)." App. 4.
In Gearey the Court of Appeals had interpreted the controlling Selective Service regulation[2] to require a local board to reopen a registrant's classification if it found that the registrant's conscientious objector views had ripened only after he had been notified to report for *362 induction. At the time respondent was ordered to report for induction, Gearey remained the law of the Circuit. Two months later, however, this Court rejected Gearey in a decision affirming a contrary holding from another Circuit. Ehlert v. United States, 402 U.S. 99 (1971).
When the case proceeded to trial, respondent waived trial to a jury, and the case was tried to the court. At the close of the evidence, the court reserved decision in order to give the parties an opportunity to submit proposed findings. Although it does not appear from the record that either party requested the court to find the facts specially, Fed. Rule Crim. Proc. 23 (c), the court filed written findings of fact and conclusions of law, and directed that the indictment be dismissed and the respondent be discharged. The court acknowledged that respondent had failed to report for induction as ordered, 349 F. Supp., at 1070, and that under Ehlert the board is not required to entertain conscientious objector claims arising between notice of induction and the scheduled induction date. Nevertheless, since respondent failed to report for induction at a time when Ehlert had not yet been decided and Gearey represented the prevailing law, respondent was entitled to a postponement of induction until the board considered his conscientious objector claim. The court reasoned that it would be unfair to apply Ehlert to respondent:
"This court cannot permit the criminal prosecution of the defendant under these circumstances without seriously eroding fundamental and basic equitable principles of law." 349 F. Supp., at 1073.[3]
*363 The Government filed a timely notice of appeal[4] and argued that the District Court had incorrectly concluded that Ehlert was not retroactive.[5] Since this Court held long ago that the Government cannot bring an appeal in a criminal case absent an express enabling statute, United States v. Sanges, 144 U.S. 310 (1892), the Court of Appeals considered first whether petitioner's appeal was authorized by 18 U.S. C. § 3731.
The Government contended, and respondent did not dispute, that the intention of Congress in amending 18 *364 U. S. C. § 3731 in 1971 was to extend the Government's right to appeal to the fullest extent consonant with the Fifth Amendment.[6] Judge Friendly, writing for the Court of Appeals, carefully reviewed the evolution of the Double Jeopardy Clause and concluded that the draftsmen "intended to import into the Constitution the common law protections much as they were described by Blackstone." 490 F.2d, at 873. While available evidence was equivocal on whether "the crown's inability to appeal an acquittal after a trial on the merits" was incorporated in the common-law concept of double jeopardy, the majority was of the view that decisions by this Court had resolved any such ambiguity adversely to the Government. Id., at 874, citing United States v. Ball, 163 U.S. 662 (1896); Kepner v. United States, 195 U.S. 100 (1904); Fong Foo v. United States, 369 U.S. 141 (1962); United States v. Sisson, 399 U.S. 267 (1970). Although the District Court had characterized its action as a dismissal of the indictment, the Court of Appeals concluded that the respondent had been acquitted since the District Court had relied upon facts developed at trial and had concluded "that the statute should not be applied to [respondent] as a matter of fact." 490 F.2d, at 878.
Judge Lumbard dissented on two grounds. First, an appeal by the Government was permissible since the District Court had properly characterized its action as a dismissal rather than an acquittal. The District Court's decision was "essentially a legal determination construing the statute on which the indictment was based," id., at 882, and not really an adjudication on the merits in the sense that it rested on facts brought out at trial. Second, even if the District Court did acquit respondent, the Double Jeopardy Clause does not stand as an absolute *365 barrier against appeals by the Government; there is a societal interest to be weighed in determining the appealability of the decision.[7]
II
When a case has been tried to a jury, the Double Jeopardy Clause does not prohibit an appeal by the Government providing that a retrial would not be required in the event the Government is successful in its appeal. United States v. Wilson, ante, at 344-345, 352-353. When this principle is applied to the situation where the jury returns a verdict of guilt but the trial court thereafter enters a judgment of acquittal, an appeal is permitted. In that situation a conclusion by an appellate court that the judgment of acquittal was improper does not require a criminal defendant to submit to a second trial; the error can be corrected on remand by the entry of a judgment on the verdict. To be sure, the defendant would prefer that the Government not be permitted to appeal or that the judgment of conviction not be entered, but this interest of the defendant is not one that the Double Jeopardy Clause was designed to protect.
Since the Double Jeopardy Clause of the Fifth Amendment nowhere distinguishes between bench and jury trials, the principles given expression through that Clause apply to cases tried to a judge. While the protection against double jeopardy has most often been articulated *366 in the context of jury trials,[8] the recent decision by Congress to authorize Government appeals whenever consistent with the Double Jeopardy Clause, when combined with the increasing number[9] of bench trials, makes this area important though unilluminated by prior decisions of this Court.
A general finding of guilt by a judge may be analogized to a verdict of "guilty" returned by a jury. Mulloney v. United States, 79 F.2d 566, 584 (CA1 1935), cert. denied, 296 U.S. 658 (1936). In a case tried to a jury, the distinction between the jury's verdict of guilty and the court's ruling on questions of law is easily perceived. In a bench trial, both functions are combined in the judge, and a general finding of "not guilty" may rest either on *367 the determination of facts in favor of a defendant or on the resolution of a legal question favorably to him. If the court prepares special findings of fact, either because the Government or the defendant requested them[10] or because the judge has elected to make them sua sponte,[11] it may be possible upon sifting those findings to determine that the court's finding of "not guilty" is attributable to an erroneous conception of the law whereas the court has resolved against the defendant all of the factual issues necessary to support a finding of guilt under the correct legal standard. The Government argues that this is essentially what happened in this case. Brief for United States 11-14.
We are less certain than the Government, however, of the basis upon which the District Court ruled. It is, to be sure, not clear that the District Court resolved issues of fact in favor of respondent. But neither is it clear to us that the District Court, in its findings of fact and conclusions of law, expressly or even impliedly found against respondent on all the issues necessary to establish guilt under even the Government's formulation of the applicable law. The court's opinion certainly contains no general finding of guilt, and although the specific findings resolved against respondent many of the component elements of the offense, there is no finding on the statutory element of "knowledge." In light of the judge's discussion of the Gearey issue in his opinion, such an omission may have reflected his conclusion that the Government *368 had failed to establish the requisite criminal intent beyond a reasonable doubt. See n. 3, supra.
On such a record, a determination by the Court of Appeals favorable to the Government on the merits of the retroactivity issue tendered to it by the Government would not justify a reversal with instructions to reinstate the general finding of guilt: there was no such finding, in form or substance, to reinstate. We hold today in Wilson, supra, that the Double Jeopardy Clause does not bar an appeal when errors of law may be corrected and the result of such correction will simply be a reinstatement of a jury's verdict of guilty or a judge's finding of guilt. But because of the uncertainty as to the basis for the District Court's action here, Wilson does not govern this case.
The Government suggests two possible theories, each of which would go beyond our holding in Wilson, for permitting an appeal even though the trial proceedings did not result in either a verdict or a finding of guilt. First, the Government suggests that "whether a new trial must follow an appeal is always a relevant consideration," but no more; the Double Jeopardy Clause is not an absolute bar in such a situation.[12] Second, at least in a bench trial setting, the Government contends that the concept of "trial" may be viewed quite broadly. If, in a bench trial, a judge has ruled in favor of the defendant at the close of the Government's case on an erroneous legal theory, the Government ought to be able to appeal; if the appeal were successful, any subsequent proceedings including, presumably, the reopening of the proceeding for the admission of additional evidence, would merely *369 be a "continuation of the first trial."[13] Tr. of Oral Arg. 16. This theory would also permit remanding a case to the District Court for more explicit findings.
We are unable to accept the Government's contentions. Both rest upon an aspect of the "continuing jeopardy" concept that was articulated by Mr. Justice Holmes in his dissenting opinion in Kepner v. United States, 195 U. S., at 134-137, but has never been adopted by a majority of this Court. Because until recently appeals by the Government have been authorized by statute only in specified and limited circumstances, most of our double jeopardy holdings have come in cases where the defendant has appealed from a judgment of conviction. See, e. g., Green v. United States, 355 U.S. 184 (1957); Trono v. United States, 199 U.S. 521 (1905); United States v. Ball, 163 U. S., at 671-672. In those few cases that have reached this Court where the appellate process was initiated by the Government following a verdict of acquittal, the Court has found the appeal barred by the Double Jeopardy Clause. See, e. g., Kepner v. United States, supra; Fong Foo v. United States, 369 U.S. 141 (1962). In those cases, where the defendants had not been adjudged guilty, the Government's appeal was not permitted since further proceedings, usually in the form of a full retrial, would have followed. Here there was a judgment discharging the defendant, although we cannot say with assurance *370 whether it was, or was not, a resolution of the factual issues against the Government. But it is enough for purposes of the Double Jeopardy Clause, and therefore for the determination of appealability under 18 U.S. C. § 3731, that further proceedings of some sort, devoted to the resolution of factual issues going to the elements of the offense charged, would have been required upon reversal and remand. Even if the District Court were to receive no additional evidence, it would still be necessary for it to make supplemental findings. The trial, which could have resulted in a judgment of conviction, has long since terminated in respondent's favor. To subject him to any further such proceedings at this stage would violate the Double Jeopardy Clause:
"The underlying idea, one that is deeply ingrained in at least the Anglo-American system of jurisprudence, is that the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity . . . ." Green v. United States, supra, at 187.
Affirmed.
MR. JUSTICE DOUGLAS, with whom MR. JUSTICE BRENNAN joins, concurring in the judgment. | Respondent Jenkins was indicted and charged with violating 12 (a) of the Military Selective Service Act, as amended, 50 U.S. C. App. 462 (a), for "knowingly refusing and failing to submit to induction into the armed forces of the United" App. After a bench trial, the District Court "dismissed" the indictment and "discharged" the respondent. The Government sought to appeal this ruling pursuant to 18 U.S. C. 71,[1] but the *60 Court of Appeals for the Second Circuit dismissed the appeal "for lack of jurisdiction on the ground that the Double Jeopardy clause prohibits further prosecution." We granted certiorari in this case and United v. Wilson, ante, p. 2, also decided today, to consider the application of the Double Jeopardy Clause of the Fifth Amendment to Government appeals in criminal cases. I Respondent, who had first registered with his local draft board in 1966, was classified 1-A by his local board on November 18, 1970. He was found physically fit for induction, and on February 4, 1971, the local board sent respondent an Order to Report for Induction on February 24, 1971. After consulting an attorney and a local draft counselor, respondent wrote the local board and requested Selective Service Form 150 for a conscientious objector classification. Having received no response from the local board by February 2, the day before he had been to report for induction, respondent went in person to the local board to request Form 150. Although respondent did secure the desired form, local board officials were directed by Selective Service headquarters not to postpone his induction to allow him to complete and submit the conscientious objector form. Respondent did not report for induction on February 24, 1971, and he was subsequently indicted. Respondent was arraigned on January 1, and pleaded not guilty. The parties were directed to file all pretrial motions within 45 days, but no pretrial motions *61 were filed within that period. The case was called and continued on several occasions. During this period respondent filed a motion for judgment of acquittal based, in part, on the following ground: "The failure of the local board to postpone the induction order pending the determination of the defendant's claim as a conscientious objector was arbitrary and contrary to law and rendered the Order to report for induction invalid. United" App. 4. In Gearey the Court of Appeals had interpreted the controlling Selective Service regulation[2] to require a local board to reopen a registrant's classification if it found that the registrant's conscientious objector views had ripened only after he had been notified to report for *62 induction. At the time respondent was to report for induction, Gearey remained the law of the Circuit. Two months later, however, this Court rejected Gearey in a decision affirming a contrary holding from another Circuit. When the case proceeded to trial, respondent waived trial to a jury, and the case was tried to the court. At the close of the evidence, the court reserved decision in order to give the parties an opportunity to submit proposed findings. Although it does not appear from the record that either party requested the court to find the facts specially, Fed. Rule Crim. Proc. 2 (c), the court filed written findings of fact and conclusions of law, and directed that the indictment be dismissed and the respondent be discharged. The court acknowledged that respondent had failed to report for induction as and that under Ehlert the board is not required to entertain conscientious objector claims arising between notice of induction and the scheduled induction date. Nevertheless, since respondent failed to report for induction at a time when Ehlert had not yet been decided and Gearey represented the prevailing law, respondent was entitled to a postponement of induction until the board considered his conscientious objector claim. The court reasoned that it would be unfair to apply Ehlert to respondent: "This court cannot permit the criminal prosecution of the defendant under these circumstances without seriously eroding fundamental and basic equitable principles of law." 49 F. Supp., at[] *6 The Government filed a timely notice of appeal[4] and argued that the District Court had incorrectly concluded that Ehlert was not retroactive.[5] Since this Court held long ago that the Government cannot bring an appeal in a criminal case absent an express enabling statute, United the Court of Appeals considered first whether petitioner's appeal was authorized by 18 U.S. C. 71. The Government contended, and respondent did not dispute, that the intention of Congress in amending 18 *64 U. S. C. 71 in 1971 was to extend the Government's right to appeal to the fullest extent consonant with the Fifth Amendment.[6] Judge Friendly, writing for the Court of Appeals, carefully reviewed the evolution of the Double Jeopardy Clause and concluded that the draftsmen "intended to import into the Constitution the common law protections much as they were described by Blackstone." While available evidence was equivocal on whether "the crown's inability to appeal an acquittal after a trial on the merits" was incorporated in the common-law concept of double jeopardy, the majority was of the view that decisions by this Court had resolved any such ambiguity adversely to the Government. citing United ; ; Fong ; United Although the District Court had characterized its action as a dismissal of the indictment, the Court of Appeals concluded that the respondent had been acquitted since the District Court had relied upon facts developed at trial and had concluded "that the statute should not be applied to [respondent] as a matter of fact." Judge Lumbard dissented on two grounds. First, an appeal by the Government was permissible since the District Court had properly characterized its action as a dismissal rather than an acquittal. The District Court's decision was "essentially a legal determination construing the statute on which the indictment was based," and not really an adjudication on the merits in the sense that it rested on facts brought out at trial. Second, even if the District Court did acquit respondent, the Double Jeopardy Clause does not stand as an absolute *65 barrier against appeals by the Government; there is a societal interest to be weighed in determining the appealability of the decision.[7] II When a case has been tried to a jury, the Double Jeopardy Clause does not prohibit an appeal by the Government providing that a retrial would not be required in the event the Government is successful in its appeal. United v. Wilson, ante, at 44-45, 52-5. When this principle is applied to the situation where the jury returns a verdict of guilt but the trial court thereafter enters a judgment of acquittal, an appeal is permitted. In that situation a conclusion by an appellate court that the judgment of acquittal was improper does not require a criminal defendant to submit to a second trial; the error can be corrected on remand by the entry of a judgment on the verdict. To be sure, the defendant would prefer that the Government not be permitted to appeal or that the judgment of conviction not be entered, but this interest of the defendant is not one that the Double Jeopardy Clause was designed to protect. Since the Double Jeopardy Clause of the Fifth Amendment nowhere distinguishes between bench and jury trials, the principles given expression through that Clause apply to cases tried to a judge. While the protection against double jeopardy has most often been articulated *66 in the context of jury trials,[8] the recent decision by Congress to authorize Government appeals whenever consistent with the Double Jeopardy Clause, when combined with the increasing number[9] of bench trials, makes this area important though unilluminated by prior decisions of this Court. A general finding of guilt by a judge may be analogized to a verdict of "guilty" returned by a jury. cert. denied, In a case tried to a jury, the distinction between the jury's verdict of guilty and the court's ruling on questions of law is easily perceived. In a bench trial, both functions are combined in the judge, and a general finding of "not guilty" may rest either on *67 the determination of facts in favor of a defendant or on the resolution of a legal question favorably to him. If the court prepares special findings of fact, either because the Government or the defendant requested them[10] or because the judge has elected to make them sua sponte,[11] it may be possible upon sifting those findings to determine that the court's finding of "not guilty" is attributable to an erroneous conception of the law whereas the court has resolved against the defendant all of the factual issues necessary to support a finding of guilt under the correct legal standard. The Government argues that this is essentially what happened in this case. Brief for United 11-14. We are less certain than the Government, however, of the basis upon which the District Court ruled. It is, to be sure, not clear that the District Court resolved issues of fact in favor of respondent. But neither is it clear to us that the District Court, in its findings of fact and conclusions of law, expressly or even impliedly found against respondent on all the issues necessary to establish guilt under even the Government's formulation of the applicable law. The court's opinion certainly contains no general finding of guilt, and although the specific findings resolved against respondent many of the component elements of the offense, there is no finding on the statutory element of "knowledge." In light of the judge's discussion of the Gearey issue in his opinion, such an omission may have reflected his conclusion that the Government *68 had failed to establish the requisite criminal intent beyond a reasonable doubt. See n. On such a record, a determination by the Court of Appeals favorable to the Government on the merits of the retroactivity issue tendered to it by the Government would not justify a reversal with instructions to reinstate the general finding of guilt: there was no such finding, in form or substance, to reinstate. We hold today in Wilson, that the Double Jeopardy Clause does not bar an appeal when errors of law may be corrected and the result of such correction will simply be a reinstatement of a jury's verdict of guilty or a judge's finding of guilt. But because of the uncertainty as to the basis for the District Court's action here, Wilson does not govern this case. The Government suggests two possible theories, each of which would go beyond our holding in Wilson, for permitting an appeal even though the trial proceedings did not result in either a verdict or a finding of guilt. First, the Government suggests that "whether a new trial must follow an appeal is always a relevant consideration," but no more; the Double Jeopardy Clause is not an absolute bar in such a situation.[12] Second, at least in a bench trial setting, the Government contends that the concept of "trial" may be viewed quite broadly. If, in a bench trial, a judge has ruled in favor of the defendant at the close of the Government's case on an erroneous legal theory, the Government ought to be able to appeal; if the appeal were successful, any subsequent proceedings including, presumably, the reopening of the proceeding for the admission of additional evidence, would merely *69 be a "continuation of the first trial."[1] Tr. of Oral Arg. 16. This theory would also permit remanding a case to the District Court for more explicit findings. We are unable to accept the Government's contentions. Both rest upon an aspect of the "continuing jeopardy" concept that was articulated by Mr. Justice Holmes in his dissenting opinion in 195 U. S., at 14-17, but has never been adopted by a majority of this Court. Because until recently appeals by the Government have been authorized by statute only in specified and limited circumstances, most of our double jeopardy holdings have come in cases where the defendant has appealed from a judgment of conviction. See, e. g., Green v. United 55 U.S. 184 ; Trono v. United ; United 16 U. S., at 671-672. In those few cases that have reached this Court where the appellate process was initiated by the Government following a verdict of acquittal, the Court has found the appeal barred by the Double Jeopardy Clause. See, e. g., Fong In those cases, where the defendants had not been adjudged guilty, the Government's appeal was not permitted since further proceedings, usually in the form of a full retrial, would have followed. Here there was a judgment discharging the defendant, although we cannot say with assurance *70 whether it was, or was not, a resolution of the factual issues against the Government. But it is enough for purposes of the Double Jeopardy Clause, and therefore for the determination of appealability under 18 U.S. C. 71, that further proceedings of some sort, devoted to the resolution of factual issues going to the elements of the offense charged, would have been required upon reversal and remand. Even if the District Court were to receive no additional evidence, it would still be necessary for it to make supplemental findings. The trial, which could have resulted in a judgment of conviction, has long since terminated in respondent's favor. To subject him to any further such proceedings at this stage would violate the Double Jeopardy Clause: "The underlying idea, one that is deeply ingrained in at least the Anglo-American system of jurisprudence, is that the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity" Green v. United Affirmed. MR. JUSTICE DOUGLAS, with whom MR. JUSTICE BRENNAN joins, concurring in the judgment. |
Subsets and Splits