With the Supreme Court Poised to Address Personal Jurisdiction Again, State High Courts Reject Attempts to Evade “Daimler v. Bauman”

kobakGilletteingraham

Guest Commentary

By Sara Kobak, W. Michael Gillette, and Aukjen Ingraham, Shareholders with Schwabe, Williamson & Wyatt, P.C. in Portland, OR.

Since the US Supreme Court clarified the due-process limits on the exercise of general or all-purpose jurisdiction in Daimler AG v. Bauman, 134 S. Ct. 746 (2014), plaintiffs have reached for new arguments to support the exercise of general jurisdiction over corporate defendants in forums where the defendants cannot fairly be considered “at home.” With notable exceptions—including the decisions at issue in Bristol-Myers Squibb Co. v. Superior Court of California, Case No. 16-466, and Tyrell v. BNSF Railway Co., Case No. 16-405, both scheduled for argument before the Supreme Court on April 25, 2017—the majority of lower courts have rejected these attempts to evade Daimler and its due-process requirements. The most recent examples of decisions enforcing Daimler come from the high courts of Oregon and Missouri, with the Washington Legal Foundation submitting an amicus brief in the Oregon case. Continue reading

Supreme Court Cert Grant in “Farha v. US” Can Clarify Level of Criminal Intent Needed to Prove “Knowledge”

johnlauroGuest Commentary

By John Lauro, a white-collar defense attorney who represented one of the WellCare defendants at trial and at the Eleventh Circuit.

On Friday, April 21, 2017, the US Supreme Court will meet in conference to consider a pending petition for certiorari in Farha v. United States, No. 16-888, a major white-collar fraud case raising an important issue of concern to the defense bar and their clients: whether “deliberate indifference” is a sufficient level of mens rea for proving “knowledge” with respect to federal criminal statutes.  The High Court should grant review and reverse the US Court of Appeals for the Eleventh Circuit ruling holding otherwise.

Farha is a classic case of overcriminalization, where civil and administrative remedies are more appropriate in the regulatory area of complex healthcare and business law. The case was extensively discussed in prior postings at the WLF Legal Pulse (here and here) and a WLF Legal Backgrounder [hot link to Kaiser’s piece]. In brief, following a raid by 200 FBI Agents at the offices of WellCare, a Florida Medicaid health maintenance organization, several executives, including the CEO, CFO, and general counsel, were indicted on healthcare fraud charges based on the government’s interpretation of Florida’s Medicaid law.   Continue reading

“Sandoz v. Amgen”: High Court to Weigh in on Biosimilars’ “Patent Dance”

Kaminski_Jeffri_LRFeatured Expert Contributor – Intellectual Property (Patents)

Jeffri A. Kaminski, Partner, Venable LLP, with Tyler Hale, Associate, Venable LLP.

In 1984, Congress passed the Drug Price Competition and Patent Term Restoration Act, commonly known as the Hatch-Waxman Act, and redrew the legal landscape for intellectual property in the pharmaceutical industry.  The law balanced the need for brand-name drug innovators to profit from their research and development investments with the public good of low-cost generic drugs by creating a pathway for swift FDA approval of generic drugs immediately following the expiration of patent exclusivity.  By all accounts, the law has been a success, creating the drug lifecycle we know and expect today: new drugs enter the market at a high price with a limited period of exclusivity, after which several generic competitors enter the market and drive prices down to a fraction of their original cost. Continue reading

After SCOTUS’s “Escobar” Decision, Courts Increasingly Sink Implied-Certification FCA Suits

scales of justiceOver the last two decades, the False Claims Act (FCA) has become a popular tool for plaintiffs—and qui tam attorneys—to enrich themselves at the expense of government contractors.  To keep the profits flowing, private plaintiffs, called relators, have invented new legal theories under which to bring their claims. As they test the FCA’s bounds, defendants have urged courts to maintain the law’s traditional limits. Last June, the US Supreme Court addressed one of FCA relators’ more successful liability expansions: the “implied-certification” theory. As a recent WLF Legal Backgrounder notes, though the Court affirmed the availability of this liability theory in Universal Health Services v. US ex rel. Escobar, it also urged lower courts to carefully scrutinize relators’ complaints as a way of limiting the implied-certification claims. Federal appellate courts have begun taking the Supreme Court at its word and have rejected claims that cannot establish materiality or satisfy the FCA’s scienter requirement. Continue reading

Vigorous Dissent from Fifth Circuit’s Denial of Rehearing Should Help ESA Frog-Habitat Case Leap to Supreme Court

sboxermanFeatured Expert Column – Environmental Law and Policy

By Samuel B. Boxerman, Sidley Austin LLP with Katharine Falahee Newman, Sidley Austin LLP

A fractured US Court of Appeals for the Fifth Circuit rejected a request seeking rehearing en banc of the court’s decision in Markle Interests, LLC, et al v. U.S. Fish and Wildlife Service, et al. The February 13 decision is the latest in the ongoing legal saga regarding the endangered dusky gopher frog and the designation of private property in Louisiana as “critical habitat”—even though this “shy frog” does not reside on the land and the land does not currently feature the characteristics needed to support the frog.

On June 5, 2016, a majority panel for the Fifth Circuit upheld the district court’s opinion that nearly 1,500 acres of private land in Louisiana (“Unit 1”) is critical habitat for the frog and therefore subject to the requirements of the Endangered Species Act.  In order to be designated as critical habitat, land must meet strict criteria: it must contain physical or biological features essential to conservation of the species. The land in question contains only one of three features considered necessary to support the dusky gopher frog—five ephemeral ponds—and more significantly, is covered with closed canopy pine that make the land uninhabitable by the species. Designation of the land as critical habitat comes at a cost of nearly $34 million in economic impact to the landowners. Despite these facts, the majority held that the land was critical habitat and furthermore, that the US Fish and Wildlife Service’s decision not to carve out Unit 1 from the critical-habitat decisions was judicially unreviewable. Continue reading

WLF’s ‘Gordon v. Consumer Financial Protection Bureau’ Supreme Court Petition Evaluated in Law Firm’s Year-End Assessment of CFPB

gordonvcfpb-certpetition_page_01In a year-end assessment of the Consumer Financial Protection Bureau (CFPB), attorneys from the law firm K&L Gates LLP evaluated the potential impact of Gordon v. CFPB, a constitutional challenge in which Washington Legal Foundation has filed a certiorari petition with the US Supreme Court on behalf of its client, Chance Gordon.

In the Legal Insight, “Down But Not Out: The CFPB’s Future May Be Uncertain, But Industry Participants Must Remain Vigilant,” the authors discuss judicial challenges facing the Bureau in 2017, including Gordon and PHH Corp. v. CFPB.  In PHH Corp., the US Court of Appeals for the DC Circuit ruled that CFPB’s leadership structure runs afoul of the Constitution’s separation of powers. WLF’s petition in Gordon calls into question the subsequent, retroactive ratification of CFPB’s enforcement action against Mr. Gordon, as well as 15 other actions, that were taken during a time when Bureau Director Richard Cordray had not been lawfully appointed.

The K&L Gates Legal Insight notes:

With PHH concluding (for now) that the CFPB’s directorship structure is unconstitutional and Gordon questioning the validity of certain CFPB actions on other constitutionality grounds, a trend may be developing toward judicial challenges to the validity of the CFPB as an agency and the propriety of its enforcement activities.”

A WLF Legal Pulse post discussing Gordon and the three amicus briefs filed in support of WLF’s cert petition can be found here.

‘Amicus’ Briefs Support WLF’s ‘Gordon v. CFPB’ Cert Petition on Appointments Clause and Standing Issues

supreme courtOn November 17, 2016, Washington Legal Foundation petitioned the US Supreme Court to review a US Court of Appeals for the Ninth Circuit decision, Gordon v. Consumer Financial Protection Bureau. CFPB had pursued a substantial fine against WLF’s client, Chance Gordon, in June 2013, a time during which the Bureau lacked a properly appointed Director. Mr. Gordon’s petition argues that the attempted corrective action Richard Cordray took once he lawfully became CFPB Director—a blanket, retroactive ratification of all actions taken during his unconstitutional recess appointment—runs afoul of the US Constitution’s Appointments Clause (contained in Article II). Mr. Gordon also argues that because Mr. Cordray had not been properly appointed, CFPB lacked standing to pursue a claim against him in federal court.

This week, three organizations filed amicus curiae briefs with the Supreme Court in support of Mr. Gordon’s writ of certiorari. The briefs positively reinforce WLF’s two major justifications for the Court’s review of Gordon v. CFPB. The petition first argues that the Ninth Circuit’s acceptance of Director Cordray’s blanket ratification severely undermines a fundamental check on Executive power: the requirement that Congress must first approve presidential nominees before they can be lawfully appointed. The Gordon decision is also contrary to Supreme Court precedent and furthers a split in the circuit courts over when ratification of ultra vires administrative action is permissible. Continue reading