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Merrill Lynch, et al. v. Greg Manning, et al.

Issues

Does Section 27 of the Securities Exchange Act of 1934 give federal courts exclusive jurisdiction over state law claims based on violations of the Exchange Act, or may state courts hear those state law claims?

 

In this case, the Supreme Court will decide whether Section 27 of the Securities Exchange Act of 1934 (“Exchange Act”) provides federal courts with exclusive jurisdiction over state law claims based on violations of the Exchange Act or whether state courts are permitted to hear such state law claims. See Brief for Petitioner, Merrill Lynch, et al. at i. Merrill Lynch argues that Manning relies on Regulation SHO, a federal regulation, and therefore federal courts have exclusive jurisdiction under the Exchange Act. See id. at 19. On the other hand, Manning argues that, because his claims are based on state law, state courts have jurisdiction over this case, even if some elements of his claim rely on federal law. See Brief for Respondent, Greg Manning, et al. at 25. Ultimately, the Court’s decision has the potential to affect whether uniformity in decision-making is necessary to enforce Regulation SHO and whether state courts can govern duties arising under federal regulations. See Brief of Amicus Curiae The Chamber of Commerce of the United States of America, in Support of Petitioner at 8–9.

Questions as Framed for the Court by the Parties

Does Section 27 of the Securities Exchange Act of 1934 provide federal jurisdiction over state law claims  seeking  to establish liability based on violations of the Act or its regulations or seeking to enforce duties created by the Act or its regulations?

Greg Manning and others (hereinafter “Manning”), brought a lawsuit against Merrill Lynch Pierce Fenner & Smith, Inc.Knight Capital Americas L.P.UBS Securities LLC

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Meredith v. Jefferson County Board of Education,

Issues

Can school districts constitutionally use percentage-based range plans to assign students to public schools based on race in order to capture the benefits of educational diversity?

 

The Jefferson County Public School District in Jefferson County, Kentucky, requires that 15 to 50 percent of all students in each school be African-American. Petitioner Crystal Meredith claims that the district violated the Fourteenth Amendment when it rejected her application to enroll her son at a nearby school on the basis of race. To decide this case, the Supreme Court will have to determine whether racial diversity in K–12 public education is a compelling state interest and whether the district’s racial range mandate is narrowly tailored to further that interest. The decision will determine the extent to which schools are permitted to consider race in school assignment policies.

Questions as Framed for the Court by the Parties

  1. Should Grutter v. Bollinger, 539 U.S. 306 (2003) and Regents of University of California v. Bakke, 438 U.S. 265 (1978) and Gratz v. Bollinger, 539 U.S. 244 (2003) be overturned and/or misapplied by the Respondent, the Jefferson County Board of Education to use race as the sole factor to assign students to the regular (non-traditional) schools in the Jefferson County Public Schools?
  2. Whether the race-conscious Student Assignment Plan with mechanical and inflexible quota systems of not less than 15% nor greater than 50% of African American students without individually or holistic review of any student, meets the Fourteenth Amendment requirement of the use of race which is a compelling interest narrowly tailored with strict scrutiny.
  3. Did the District Court abuse and/or exceed its remedial judicial authority in maintaining desegregative attractiveness in the Public Schools of Jefferson County, Kentucky?

Desegregation of Schools in Jefferson County

The backdrop for this case was set in 1954. In Brown v. Board of Education, 347 U.S. 483 (1954), the Supreme Court mandated the desegregation of public schools. Over subsequent decades, federal courts ordered school districts with institutionalized segregation plans to desegregate through a system of redistricting and busing. See Swann v. Charlotte-Mecklenburg Bd.

Acknowledgments

The authors would like to thank Professors Sherri Lynn JohnsonTrevor Morrison, and Michael Heise for their insights into this case.

The Supreme Court will hear this case in tandem with a companion case, Parents Involved in Community Sch. v. Seattle Sch. District ,  which involves a student assignment plan that uses race as a tiebreaker to balance high schools that differ by more than 15 percent from the racial  make up  of the Seattle public school system.

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Merck & Co., Inc. v. Reynolds

Issues

Whether the two-year limitations period to bring a suit under the Securities Exchange Act begins when the plaintiff has obtained knowledge that the defendant acted with the intent to defraud, or simply when the plaintiff obtained general knowledge of facts pointing to potential fraud?

 

Under 28 U.S.C. § 1658(b), a plaintiff must file a claim alleging violation of the Securities Exchange Act of 1934 no later than two years after the plaintiff discovers the facts constituting the violation.  The Courts of Appeals are in general agreement that the two-year period of limitations begins when the plaintiff had, or should have had knowledge of the facts constituting the violation.  What is at issue in this case is whether knowledge that defendant acted with the intent to deceive is a fact constituting the violation for purposes of triggering the two-year period of limitation.  The Supreme Court’s decision will resolve this question of statutory interpretation and, in so doing, will determine the delicate balance between allowing plaintiffs with meritorious claims access to the federal courts and providing certainty and repose to potential securities fraud defendants.

Questions as Framed for the Court by the Parties

Did the Third Circuit err in holding, in accord with the Ninth Circuit but in contrast to nine other Courts of Appeals, that under the "inquiry notice" standard applicable to federal securities fraud claims, the statute of limitations does not begin to run until an investor receives evidence of scienter without the benefit of any investigation?

Under 28 U.S.C. § 1658, claims of “fraud, deceit, manipulation or contrivance” concerning the Securities Exchange Act of 1934 can be made either “[two] years after the discovery of the facts constituting the violation,” or “[five] years after such violation,” whichever is earlier. See 28 U.S.C. § 1658(b). Respondents, Reynolds, et.

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Menominee Indian Tribe of Wisconsin v. United States of America, et al.

Issues

Whether the D.C. Circuit misapplied Holland’s decision when it ruled that the statute of limitations was not subject to equitable tolling for claims brought under the Indian Self Determination and Education Assistance Act (“ISDA”)? See Brief for Petitioner at i.

 

The U.S. Supreme Court will decide whether the D.C. Circuit misapplied the Court’s decision in Holland v. Florida when the D.C. Circuit ruled that the statute of limitations was not subject to equitable tolling for the Menominee Indian Tribe of Wisconsin’s (“the Tribe”) 1996–1998 claims for contract support costs. See Brief for Respondent at i. The Tribe argues that despite the D.C. Circuit’s interpretation of the Holland standard for equitable tolling as rigid and mechanical, the Holland standard should instead conform to the Federal Circuit standard, which is a comprehensive and unified analysis that also follows the proper interpretation of HollandSee Brief for Petitioner at 5–6. In contrast, the United States argues that the elements within a comprehensive analysis do not provide an independent basis for equitable  tolling,  and that equitable tolling should not excuse the Tribe’s miscalculations and legal misunderstandings. See Brief for Respondent at 21–22, 48.

Questions as Framed for the Court by the Parties

Petitioner: Whether the D.C. Circuit misapplied this Court’s Holland decision when it ruled that the Tribe was not entitled to equitable tolling of the statute of limitations for filing of ISDA claims under the CDA? See Brief for Petitioner at i.

 Respondent: Whether the court of appeals misapplied this Court’s decision in Holland v. Florida, when it ruled that petitioner was not entitled to equitable tolling of the statute of limitations for filing of ISDA claims under the CDA? See Brief for Respondent at I

Between 1995 and 2004, the Tribe provided healthcare services to its members pursuant to a self-determination contract with the Secretary of Health and Human Services (“HHS”). Menominee Indian Tribe of Wis. v. United States, 764 F.3d 51, 54 (U.S. App. 2014).

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Menominee Indian Tribe of Wisconsin v. United States of America, et al.

Issues

Whether the D.C. Circuit misapplied Holland’s decision when it ruled that the statute of limitations was not subject to equitable tolling for claims brought under the Indian Self Determination and Education Assistance Act (“ISDA”)? See Brief for Petitioner at i.

 

The U.S. Supreme Court will decide whether the D.C. Circuit misapplied the Court’s decision in Holland v. Florida when the D.C. Circuit ruled that the statute of limitations was not subject to equitable tolling for the Menominee Indian Tribe of Wisconsin’s (“the Tribe”) 1996–1998 claims for contract support costs. See Brief for Respondent at i. The Tribe argues that despite the D.C. Circuit’s interpretation of the Holland standard for equitable tolling as rigid and mechanical, the Holland standard should instead conform to the Federal Circuit standard, which is a comprehensive and unified analysis that also follows the proper interpretation of HollandSee Brief for Petitioner at 5–6. In contrast, the United States argues that the elements within a comprehensive analysis do not provide an independent basis for equitable  tolling,  and that equitable tolling should not excuse the Tribe’s miscalculations and legal misunderstandings. See Brief for Respondent at 21–22, 48.

Questions as Framed for the Court by the Parties

Petitioner: Whether the D.C. Circuit misapplied this Court’s Holland decision when it ruled that the Tribe was not entitled to equitable tolling of the statute of limitations for filing of ISDA claims under the CDA? See Brief for Petitioner at i.

 Respondent: Whether the court of appeals misapplied this Court’s decision in Holland v. Florida, when it ruled that petitioner was not entitled to equitable tolling of the statute of limitations for filing of ISDA claims under the CDA? See Brief for Respondent at I

Between 1995 and 2004, the Tribe provided healthcare services to its members pursuant to a self-determination contract with the Secretary of Health and Human Services (“HHS”). Menominee Indian Tribe of Wis. v. United States, 764 F.3d 51, 54 (U.S. App. 2014).

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MedImmune v. Genentech

Issues

Should patent licensees be required to violate the terms of a patent licensing agreement, and therefore risk a willful patent infringement suit by the patent owner, in order to challenge the validity of the patent in a court of law?

 

A declaratory judgment suit is one in which the plaintiff’s requested relief from the court is a statement of the parties’ rights. In a declaratory judgment action, an “actual controversy” must exist between the parties in order for a court to declare the rights and legal relations of the interested parties. MedImmune v. Genentech asks the Supreme Court to consider what defines an “actual controversy” as applied to suits challenging the validity of patents. Specifically, the Court will decide whether it is necessary for a patent licensee to breach the terms of a patent in order to bring suit against the patent owner. The Court’s  decision in this case  has the potential to shift the balance of power between patent holders and licensees.

Questions as Framed for the Court by the Parties

Does Article III’s grant of jurisdiction  of  "all Cases . . . arising under . . . the Laws of the United States," implemented in the "actual controversy" requirement of the Declaratory Judgment Act, 28 U.S.C. § 2201(a), require a patent licensee to refuse to pay royalties and commit  material  breach of the license agreement before suing to declare the patent invalid, unenforceable or not infringed?

MedImmune licensed a patent owned by Genentech called Cabilly I (United States Patent No. 4,816,567), which involved technology relating to the use of cell cultures to manufacture human antibodies.

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Maryland v. Blake

Issues

If one police officer violates a suspect's Fifth Amendment right to remain silent by making an inappropriate remark after the suspect has invoked that right, can the words and acts of another officer, and other circumstances, such as the passage of time, sufficiently repair the situation in order to allow the suspect to later waive his right to remain silent?

 

When the Annapolis Police arrested Leeander Blake, he invoked his right to remain silent until granted access to an attorney. While Blake was still in custody, and after Blake had invoked his right to remain silent, an officer made an inappropriate remark to him. However, the officer leading the investigation swiftly rebuked this officer, in front of Blake, for his remark. Shortly thereafter, Blake made incriminating statements without an attorney that the State sought to use against him. Under Edwards v. Arizona, a suspect who has invoked his right to remain silent cannot later waive that right unless he initiates the conversation and does so knowingly and intelligently. The Court must decide whether the supervising officer's curative remarks in this case sufficiently restored Blake's rights prior to Blake's incriminating statements.

Questions as Framed for the Court by the Parties

When a police officer improperly communicates with a suspect after  invocation  of the suspect's right to counsel, does Edwards permit consideration of curative measures by the police, or other intervening circumstances, to conclude that a suspect later initiated communication with the police?

On October 19, 2002 in Annapolis, Maryland, unknown assailants shot Straughan Lee Griffin in the head and stole his car; the assailants ran over his body as they fled. Blake v. Maryland, 381 Md. 218, 222 (2004).

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Meacham v. Knolls Atomic Power Laboratory

Issues

After an employee shows that an employment practice had a disparate impact on older workers, and after an employer presents evidence that the challenged practice was neutral, does the employer have to convince the jury that its policy was "reasonable," or does an employee have to convince the jury the policy was "unreasonable?"

 

In this case, a hair's breadth of analytical difference is worth almost $6 million dollars, as the plaintiffs, former employees at Knolls Atomic Power Laboratory ("KAPL") ask the U.S. Supreme Court to overturn the Second Circuit's finding for the defendants. The plaintiffs had prevailed at trial and on appeal on a disparate impact theory of illegal age discrimination under the Age Discrimination in Employment Act (the "ADEA"), 29 U.S.C. 621 et seq., when the Supreme Court remanded for reconsideration in light of Smith v. City of Jackson. While upholding the disparate impact theory, City of Jackson also requires the touchstone of the analysis to be whether employers considered "reasonable factors other than age," which the Second Circuit determined was a burden of persuasion to be borne by the plaintiffs. The employee-plaintiffs disagree, maintaining that the "reasonable factors other than age" harbor in the ADEA statute is a traditional affirmative defense on which the employer-defendants bear the burden of proof. In determining where the burden rests, the Supreme Court's decision will impact the nature of future employee litigation under the ADEA, shape the strategies for a successful reduction in force, and determine what deference is due the Equal Employment Opportunity Commission's regulations interpreting the ADEA.

Questions as Framed for the Court by the Parties

Whether an employee alleging disparate impact under the ADEA bears the burden of persuasion on the "reasonable factors other than age" defense, as held by the Second Circuit in this case in conflict with the decisions of other circuits and a regulation of the Equal Employment Opportunity Commission.

Knolls Atomic Power Laboratory (the "Lab") draws its workforce of 2,600 from the small upstate New York towns of Niskayuna and New Milton.

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McNeill v. United States

Issues

Whether a court determining the “seriousness” of a defendant’s prior drug offense under the Armed Career Criminal Act should look to the maximum possible sentence for that offense at the time of the defendant’s prior conviction or at the time of the individual’s current federal sentencing.

 

In 2009, Petitioner Clifton Terelle McNeill was convicted and sentenced for the possession with intent to distribute a quantity of cocaine and for the possession of a firearm in furtherance of a drug trafficking crime. The district court determined that McNeill qualified for a sentencing enhancement under the Armed Career Criminal Act ("ACCA") because of his two prior convictions for common law robbery and felony assault, as well as six convictions for selling cocaine and possession of cocaine. The ACCA applies to “serious drug offenses,” which are defined as crimes that carry a maximum imprisonment term of at least ten years. McNeill argues that the ACCA did not apply because, although his drug offenses did carry a maximum of at least ten years when they were committed, North Carolina had since lowered its drug sentences by the time of his current sentencing. Conversely, the United States insists that because North Carolina decided not to make its drug sentencing change retroactive, the ACCA does in fact apply to McNeill.

Questions as Framed for the Court by the Parties

Whether the plain meaning of "is prescribed by law" which ACCA uses to define a predicate "serious drug offense" requires a federal sentencing court to look to the maximum penalty prescribed by current state law for a drug offense at the time of the instant federal offense, regardless of whether the state has made that current sentencing law retroactive.

The Armed Career Criminal Act (“ACCA”) imposes a mandatory minimum prison sentence of fifteen years to any criminal defendant convicted of a crime with a prison sentence exceeding one year who has had three prior convictions for a violent felony or “serious drug offense.” See United States v. McNeill, 598 F.3d 161, 163 (4th Cir.

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· The Drug Policy Alliance: Mandatory Minimum Sentences

· Congressional Research Service, Charles Doyle: Armed Career Criminal Act: An Overview (Oct. 13, 2010)

· North Carolina Bar Association, Carl Horn III The Changing Landscape Governing Armed Career Criminal Sentences (June 8, 2010)

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McDonnell v United States

Issues

What are the limits of a government official’s conduct being considered an “official action,” and what implications do these limits have on jury instruction and the constitutionality of the Hobbs Act and the honest-services fraud statute?

 

In this case, the Supreme Court will decide whether an “official action” is limited to exercise of actual government power. In light of this determination, the court will then decide whether the honest-services statute and Hobbs Act sufficiently define official actions to comply with the Constitution. Robert McDonnell argues that official actions should be limited to the actual exercise of government power and that his conduct as governor was never an exercise of actual government power. Thus, McDonnell argues that his conviction should be overturned on the merits, but he also argues that the trial court’s jury instructions were erroneous based on a flawed definition of “official action” given to the jury. In addition, McDonnell argues that the honest-services statute and Hobbs Act are unconstitutionally vague. The United States argues that McDonnell construes the definition of official action too  narrowly,  and that a proper interpretation encompasses McDonnell's conduct in this case.  United States  rejects McDonnell’s jury instruction arguments based by noting that these instructions included a precise definition of “official action” from the statute, with additional information to clarify the definition. Finally, the United States rejects McDonnell’s constitutional challenges by citing a recent and similar Supreme Court challenge to these statutes that failed. 

Questions as Framed for the Court by the Parties

Is “official action” limited to exercising actual governmental power, threatening to exercise such power, or pressuring others to exercise such power, and must the jury be so instructed; or, if not so limited, are the Hobbs Act and honest-services fraud statute unconstitutional?

Petitioner Robert McDonnell was elected the governor of Virginia in 2009. United States v. McDonnell792 F.3d 478, 486 (4th Cir.

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•       Adam Liptak, Justices to Hear Appeal by Bob McDonnell, Ex-Governor of Virginia, The New York Times (Jan. 15, 2016).

•       Jonathan Stahl, Supreme Court to hear Virginia governor corruption case, Constitution Daily (Feb. 2, 2016)

•       Greg Stohr, U.S. Supreme Court Takes On Public Corruption With McDonnell Case, Tribune News Service (Jan. 18, 2016).

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