Morning Wire XX
[0] The Supreme Court began its fall term this month and now faces a slate of cases that could have widespread effects across all industries in the U .S. In this episode, we speak to a legal expert about the most interesting and important cases.
[1] I'm Georgia Howe with Daily Wire editor -in -chief John Bickley.
[2] It's Sunday, October 8th, and this is an extra edition of Morning Wire.
[3] Joining us is Zach Smith, legal fellow at the Heritage Foundation and manager of the Supreme Court and Appellate Advocacy program.
[4] Zach, thanks so much for coming on.
[5] Of course.
[6] Thank you for having me. So the Supreme Court came back in session this past week on October 2nd.
[7] Can you give us an overview of some of the big cases that you're going to be watching that have implications for the American people?
[8] Sure.
[9] Well, there are several cases that the court has agreed to hear involving important administrative law issues, involving separation of powers issues.
[10] One involves something called the Chevron doctrine, whether court should give deference to administrative agencies and their interpretation of ambiguous or unclear states.
[11] statutes.
[12] Another is Moore v. United States, which involves whether a potential wealth tax would be constitutional in the future.
[13] And there are others as well.
[14] But this is certainly a term where administrative law issues will be front and center for the court.
[15] So let's zoom in a bit on individual cases.
[16] You've alluded, I think, to Loper Bright Enterprises versus Ramondo.
[17] That's the Chevron deference case.
[18] More versus United States.
[19] That's the case related to a potential tax on unrealized gains.
[20] And like you said, there are several others before the Supreme Court this term as well.
[21] Which cases do you think are most important and or interesting to watch in terms of having the furthest reaching consequences?
[22] Well, I think the Loebar Right case will certainly be at the top of everyone's lists.
[23] Many of your listeners may have heard of something called Chevron deference.
[24] It's a very controversial doctrine in the law that basically says that where a statute or regulation is ambiguous, essentially courts should defer to an executive branch agencies interpretation of that statute or regulation.
[25] Now this is problematic for a lot of reasons.
[26] Essentially what courts are doing by deferring to an agency's interpretation is they're essentially transferring power to unelected, unaccountable bureaucrats to decide their own power.
[27] And so in this specific case, the Loper Bright case, a group of New England fisheries are challenging a regulation put forward by the regulatory body that oversees them that said not only did they have to allow fishing monitors to accompany them on their boats, but they also had to pay for those fishing monitors, for their services.
[28] Now, the statute that sets up the regulatory agency, the regulatory regime, it doesn't say anywhere in that statute that these fisheries have to pay for these monitors that accompanied them on their fishing trips, and so they're challenging this.
[29] Unfortunately, the lower federal courts, they said that the regulatory agency had this power by employing the Chevron doctrine.
[30] They said the statute was ambiguous.
[31] us.
[32] They deferred to the agency's interpretation.
[33] And so at the end of the day, what the U .S. Supreme Court is being asked to decide is whether this Chevron doctrine of deference should continue or whether courts should essentially do their job and interpret statutes and regulations for themselves.
[34] And if the Supreme Court overturns the Chevron doctrine, that would have far -reaching consequences for the entire administrative state as we know it and would fundamentally alter the balance of power between unelected, unaccountable bureaucrats on the one hand and the court system on the other.
[35] And can you give any examples off the top of your head of other industries that might be affected?
[36] Every industry that's regulated.
[37] So when I say this would have far -reaching consequences, it would literally touch every aspect of administrative law as we know it, everything from the FTC to the SEC to name any other regulated entity.
[38] So even though the facts of this specific case or somewhat narrow and nuanced, if the Chevron doctrine is overturned, it will be one of the most consequential cases that the court will have heard not only this term, but frankly over the past several terms as well.
[39] Right.
[40] Sounds like it.
[41] And is there any indication of how the justices are going to rule on this?
[42] You know, it's hard to say.
[43] Some of the justices have expressed skepticism, rightly so, I think, about the Chevron doctrine in the past.
[44] The case is being argued for the fisheries by Paul Clement.
[45] He's a former U .S. Solicitor General.
[46] He's one of the most respected Supreme Court advocates practicing today.
[47] And so I think the fact that the court took this case, the fact that Paul Clement is arguing for overturning Chevron, both of those facts indicate that at least some of the justices are very interested in revisiting their current Chevron deference doctrine.
[48] Well, it'll be interesting to see how the justice has come down on this.
[49] Now, another case that we've been tracking is the Harrington v. Purdue Pharma case.
[50] So the court's going to weigh in on this important bankruptcy case involving the Sackler family.
[51] And for listeners, the Sacklers were majority owners in the now bankrupt Purdue Pharma, which has largely been blamed for the opioid crisis, and that's because they brought the drug Oxycontin to the market and sold it under the false claims that it was non -addictive.
[52] Zach, can you explain this bankruptcy case a little bit for us and what the arguments are on each side?
[53] Yeah, this is a fascinating case that has flown under the radar in a lot of respects, but it could have far -reaching implications not only for this specific opioid -related bankruptcy, but also for many other bankruptcy cases.
[54] Because what's fundamentally at issue here are certain due process requirements.
[55] Essentially, what the Supreme Court is being asked to decide is whether in a bankruptcy case certain agreements that are reached, whether they can release all claims from people who are not part of that bankruptcy process.
[56] And it's unique in this.
[57] particular case, because the Sacklers, the family who owned Purdue Pharma for many, many years, they're not technically part of this bankruptcy case.
[58] But essentially, they were facing a lot of liability, many claims by people and family members who claimed that their family members were addicted to opioids that Purdue Pharma produced.
[59] And so in exchange for funding a very significant amount into the bankruptcy plan, essentially all future claims against them would be released.
[60] And so what the Supreme Court is being asked to decide at the behest of the Justice Department is whether this type of non -debtor release is valid under Chapter 11 of the Bankruptcy Code.
[61] So just to recap, the Sackler family is offering to pay a settlement on behalf of Purdue, and if accepted, that'll release the family from all future claims relating to opioid settlements.
[62] that's what they're trying to get off the hook for.
[63] Yeah, that's right.
[64] So Purdue Pharma is the entity that declared bankruptcy.
[65] The Sackler family is not technically part of this bankruptcy case.
[66] But that's what is so odd about this case in some ways, because the Sackler family separately is facing a lot of potential liability.
[67] And so basically by putting in several billion dollars into this bankruptcy reorganization plan.
[68] They're providing some money that could go toward victims and settlements, but certainly it's not the liability that they would face if many of these claims remained.
[69] And so in exchange for funding this bankruptcy plan, they are trying to insulate themselves from future liability, even though they're not technically part of this bankruptcy case.
[70] And so the exact issue that the court is being asked to decide is whether under Chapter 11 of the bankruptcy code, a release that extinguishes claims held by non -debtors against non -debtor third parties, that's the Sackler family, without the claimant's consent can extinguish those future claims.
[71] But at the end of the day, what this is all about, the Sackler family is trying to limit their exposure against future tort claims.
[72] All right, we probably have time for one more case.
[73] Is there one other that jumps out to you as something that our listeners might want to keep an eye on?
[74] Yeah, I think the Moore v. United States case is also a very interesting one.
[75] This case is very important because depending on what the court does with it, it could set the stage for a future wealth tax if the court upholds a law that Congress passed several years ago that allowed a one -time, supposedly one -time tax on unrealized gains involving foreign corporations.
[76] And so the argument in this case is that the 16th Amendment is the constitutional provision that allowed, the IRS, the federal government, to implement an individual income tax.
[77] Before that, the Constitution said that taxation had to be equally apportioned among the states.
[78] The argument in this case is because the gains at issue are unrealized.
[79] They don't count as income as we have traditionally understood that term to be.
[80] And so because of that, the 16th Amendment doesn't really apply, and any taxes levied would have to be apportioned as required by the original Constitution.
[81] It's a very interesting argument.
[82] It's a very nuanced argument in a lot of ways.
[83] But again, if this statute that Congress passed is upheld, you could certainly see this same rationale being used in the future to push for a wealth tax.
[84] Well, definitely a pretty loaded term for the Supreme Court.
[85] We'll be keeping tabs on several, if not all of these cases.
[86] Zach, thanks so much for coming on today.
[87] Thank you for having me on.
[88] That was Zach Smith, legal fellow at the Heritage Foundation and manager of the Supreme Court and Appellate Advocacy Program.
[89] And this has been an extra edition of Morning Wire.