Corporations and the Supreme Court

A Quiet Year for Business at the Supreme Court, with One Huge Exception | 2021-2022 Term

At the end of an otherwise routine year on the Court’s corporate docket, a conservative majority radically curtails the government’s ability to restrain big business.

Summary

Corporate Interests Under the Roberts Court

It has been more than fifteen years since Chief Justice Roberts and Associate Justice Alito joined the Supreme Court, prompting a noticeable shift in the Court’s handling of business cases. CAC has long tracked the success of corporate interests at the Court by monitoring how often the Justices adopt the position advocated by the U.S. Chamber of Commerce in its amicus briefs. The Chamber’s win/loss rate is generally a good proxy for the success of big business interests, and our study has found conspicuous results.

To begin, the Chamber’s success rate under the Roberts Court has risen to 70%, a steep increase since the 1980s and 1990s, when its success rate hovered around 50%. Equally notable, a sharp ideological divide has emerged in business cases under the Roberts Court, with conservative Justices voting in favor of the Chamber’s position at significantly higher rates than the more liberal Justices.

Furthermore, as we have explained more than once, the Chamber’s win/loss rate understates its true success at the Court. In selecting cases for review, the Justices in recent years have overwhelmingly chosen cases in which plaintiffs or the government prevailed in the lower courts. Rarely do the Justices agree to review lower-court victories for business interests. This pattern gives corporate America plenty of chances to erase lower-court decisions it disfavors, while minimizing similar opportunities for plaintiffs and the government. One result is that many of the Chamber’s “losses” at the Supreme Court are simply failed efforts to push the law aggressively in its preferred direction—not instances in which the Court moved the ball significantly in favor of employees, consumers, financial protection, or environmental safeguards.

Finally, even when the Roberts Court sides with plaintiffs or the government, it generally does so in narrow decisions that break little new ground. By contrast, the Court regularly issues landmark rulings that fundamentally transform the law in favor of corporate interests—increasingly at the expense of the people’s elected representatives in Congress and the states.

This lopsided pattern means that year after year, efforts to promote corporate accountability or restrain harms caused by industry generally tread water, at best, while big business repeatedly enjoys seismic victories that reshape the legal landscape in its favor. Although some years the Chamber and its allies make only modest gains, and other years their success is more dramatic, never does the pendulum swing very far against them.

West Virginia v. EPA: An Activist Majority Rolls Back the Government’s Power to Combat National Crises

The Supreme Court’s 2021-2022 Term was a largely uneventful year for corporate interests, in which the Justices gave the Chamber a typically high success rate but avoided dramatic changes—with one huge exception. In West Virginia v. EPA, a 6-3 conservative majority held unlawful the Clean Power Plan issued by the EPA under the Obama administration. The decision sharply limits the federal government’s ability to combat climate change, and it establishes a broad new interpretive rule designed to constrain government regulation of all kinds.

The Chamber did not actually file a brief in West Virginia, perhaps because there were industry interests on both sides of the EPA dispute. Some power companies favored the Clean Power Plan and supported it before the Court. As this illustrates, the Chamber is not always a perfect proxy for corporate interests: even though the Chamber sat this case out, the decision was a long-sought-after boon for industries seeking to evade health, safety, labor, and environmental limits.

In West Virginia, the Court ruled that the EPA’s plan was unauthorized by the Clean Air Act, even though, by the Court’s own account, the text of the Act can reasonably be read as authorizing the plan. Instead of simply interpreting the Act’s text and discerning its best reading, however, the Court imposed a new framework for resolving disputes about agency authority: the so-called “major questions doctrine.” Under this new approach, the Court first asks whether the authority that an agency is exercising implicates a “major question,” a subjective concept highly open to manipulation. If so, the agency must point to explicit authorization in the law for the precise action it took. Establishing this new approach is the culmination of series of conservative decisions over the past two decades.

The “major questions” doctrine is essentially a judicially imposed limit on the political branches, imposing heightened requirements for what Congress must say in a statute before the Court will allow it to confer power on regulatory agencies. Even though Congress wrote the Clean Air Act long before the Court invented this rule—meaning that Congress could not have anticipated the Court’s strict new requirements—that did not stop the Justices from imposing their newly minted rule retroactively on Congress’s work.

Illustrating the activist nature of the Roberts Court on corporate issues, there was no need to resolve the legitimacy of the Clean Power Plan, because that plan never went into effect and never was going to go into effect. Upon being issued in 2015, the plan was immediately challenged in litigation and put on hold by the Supreme Court, which took the unprecedented step of enjoining the plan before any court had ever weighed in on its legality. Since then, market forces alone have already produced the limited shifts to cleaner energy that the plan sought to achieve. Nevertheless, the Justices insisted on reaching out and resolving the case, seemingly as a convenient vehicle for introducing their new anti-regulation doctrine.

The result will not only hobble efforts to combat the climate crisis, it will also lead to a flood of litigation in which industries claim that other agency regulations addressing different topics are illegitimate efforts to address “major questions.” Coming from a conservative majority that professes to favor a limited role for the courts—and which frequently denies remedies to employees, consumers, and civil rights victims on that basis—the outcome is striking indeed.

The Balance of the 2021-2022 Term

The remainder of the Court’s business docket was fairly routine this Term. By our count, the Court sided with the Chamber’s position in two-thirds of the cases in which the Chamber filed a brief. That is, out of nine cases in which the Chamber urged a particular result and the Court resolved the issue, the Court adopted the Chamber’s position in six of those nine cases.[1]

This two-thirds win rate is just below the 70% rate that the Chamber has enjoyed under the Roberts Court overall.[2]

In substance, this year’s business decisions generally involved lower-stakes disputes that resulted in narrow decisions. Apart from West Virginia v. EPA, there were no groundbreaking victories or sweeping changes to the law. Most decisions were unanimous or nearly so, and only one was closely divided: In Cummings v. Premier Rehab Keller, P.L.L.C., the six-Justice conservative majority held that damages for emotional distress are not available under two federal statutes that protect against disability discrimination, because those statutes were enacted pursuant to Congress’s Spending Clause authority. Notably, the Chamber offered a narrower basis for decision in its brief, but the Court went bigger, making Cummings another exception to the incremental approach that largely characterized the business docket this Term.

In several ways, the Court backed off somewhat from its usual trends in business cases this Term. In a significant percentage of its cases, the Court granted review of corporate victories in the lower courts. By contrast, 93% of the decisions the Court reviewed last Term were victories for plaintiffs or the government. In two cases, the Court reversed lower-court victories for business,[3] something that should not be remarkable, but which the Court had done only twice in the previous five years. And this Term, the Court handed employees multiple victories in cases about the Federal Arbitration Act,[4] albeit extremely narrow victories that in no way approach the sweeping decisions of recent years blocking access to the courts in favor of forced arbitration.

The ideological divide was also narrower than usual this Term, with the Court’s six conservative Justices voting for the Chamber 58% of the time and the three moderate-to-liberal Justices 54% of the time. Last Term, by contrast, the conservative Justices were at 78% and the more liberal Justices at 53%. Indeed, Justice Thomas ended up with the lowest Chamber score of any Justice this Term (43%), although his overall score under the Roberts Court is nearly 71%. Meanwhile, Justice Breyer ranked higher in his final Term (at 62.5%) than both Justice Alito (57%) and Justice Barrett (60%). More characteristically, however, Justices Gorsuch, Kavanaugh, and Roberts were at the high end of the pro-Chamber spectrum (62.5%), with Justices Kagan and Sotomayor at the low end (50%).

Next Term

The 2022-2023 Term will offer the Court more chances to cut back on the ability of the state and federal governments to restrain big business and act in the public interest. Already on the docket are significant cases in which industry is challenging the scope of the nation’s water pollution limits, the enforcement of securities and antitrust laws through administrative proceedings, the states’ power to protect their residents by setting rules for the treatment of farm animals, and the states’ authority to exercise jurisdiction over corporations that operate within their borders. As teed up by the litigants, these cases involve deep structural issues concerning federalism and the separation of powers, providing the conservative supermajority ample opportunity to further reshape the law in favor of corporate interests.

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[1] The Chamber’s victories were (1) Cummings v. Premier Rehab Keller, P.L.L.C., (2) Hughes v. Northwestern University, (3) LeDure v. Union Pacific Railroad Co., (4) Ruan v. United States / Kahn v. United States, (5) Viking River Cruises, Inc. v. Moriana, and (6) ZF Automotive US, Inc. v. Luxshare, Ltd. The Chamber’s losses were (1) Badgerow v. Walters, (2) Morgan v. Sundance, Inc., and (3) Southwest Airlines Co. v. Saxon. Our scoring of three of these decisions as Chamber victories bears explanation. In Hughes, the Chamber supported the respondent but devoted its brief to urging a particular view about pleading standards in ERISA cases. Even though the petitioner achieved a partial victory, the Court adopted the Chamber’s view in the instructions it gave to the lower court on remand. In Ruan/Kahn, the Chamber filed a brief supporting neither party but urging the Court to reaffirm the presumption that felony offenses have a willfulness requirement. The Court reaffirmed that presumption and employed it when interpreting the statute at issue. And in LeDure, the Court was equally divided (Justice Barrett did not participate), leading it to affirm the decision below, which was the result the Chamber sought.

[2] Our two-thirds figure is also a conservative one, because it omits two additional decisions that were generally favorable toward the Chamber’s positions, but which we classified as neutral because the Court did not squarely resolve the specific issues that the Chamber’s briefs addressed: American Hospital Association v. Becerra and Siegel v. Fitzgerald. Our figure also omits three additional cases in which the Chamber filed briefs but which were dismissed or removed from the Court’s argument calendar without decision: CVS Pharmacy Inc. v. Doe, Pivotal Software v. Superior Court of CA, and Servotronics Inc. v. Rolls-Royce PLC.

[3] Those two cases were Badgerow v. Walters and Morgan v. Sundance, Inc.

[4] See Badgerow v. Walters, Morgan v. Sundance, Inc., and Southwest Airlines Co. v. Saxon.

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