President Barack Obama today nominated Second Circuit Judge Sonia Sotomayor to replace retiring Associate Justice David Souter on the U.S. Supreme Court.  NYT article here, WSJ here, Washington Post here, FOX News here, CNN here.

Judge Sotomayor grew up in the Bronx; graduated summa cum laude from Princeton in 1976 and in 1979 earned a J.D. from Yale law school, where she served on the Yale Law Journal; worked as a prosecutor in the New York district attorney's office for five years; practiced law from 1984 to 1991; won nomination by President George H. W. Bush as district judge in the Southern District of New York, where she presided until 1997, when she joined the Second Circuit.

A new federal statute that took effect last week, the Fraud Enforcement and Recovery Act, broadened the Civil War-era False Claims Act.  (FERA did several other things, too.  See White House "fact sheet" here.)

The False Claims Act in general authorizes private citizens to sue for the federal government.  Suits aim to recover civil penalties and treble damages.  The statute entitles whistleblowers to a share of the government's recovery.

You qui tam mavens out there already know about the False Claims Act.  But you may not have studied the FERA sections that broaden the Act.  For your convenience, Blawgletter offers the following to show  most of the relevant False Claims Act amendments (additions in blue; deletions in blue strikeout):

Sec. 3729.  False claims

(A) knowingly presents, or causes to be presented, to an officer or employee of the United States Government or a member of the Armed Forces of the United States a false or fraudulent claim for payment or approval;

 

(B2) knowingly makes, uses, or causes to be made or used, a false record or statement material to get a false or fraudulent claim paid or approved by the Government;

 

(C3) conspires to commit a violation of subparagraph (A), (B), (D), (E), (F), or (G)defraud the Government by getting a false or fraudulent claim allowed or paid;

 

(D4) has possession, custody, or control of property or money used, or to be used, by the Government and, intending to defraud the Government or willfully to conceal the property, knowingly delivers, or causes to be delivered, less property than the amount for which the person receives a certificate or receipt than all of that money or property;

 

(E5) is authorized to make or deliver a document certifying receipt of property used, or to be used, by the Government and, intending to defraud the Government, makes or delivers the receipt without completely knowing that the information on the receipt is true;

 

(F6) knowingly buys, or receives as a pledge of an obligation or debt, public property from an officer or employee of the Government, or a member of the Armed Forces, who lawfully may not sell or pledge the property; or

 

(G7) knowingly makes, uses, or causes to be made or used, a false record or statement material to to conceal, avoid, or decrease an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligaion to pay or transmit money or property to the Government,

(A) the person committing the violation of this subsection furnished officials of the United States responsible for investigating false claims violations with all information known to such person about the violation within 30 days after the date on which the defendant first obtained the information;

 

(B) such person fully cooperated with any Government investigation of such violation; and

 

(C) at the time such person furnished the United States with the information about the violation, no criminal prosecution, civil action, or administrative action had commenced under this title with respect to such violation, and the person did not have actual knowledge of the existence of an investigation into such violation;

(A) mean that a person, with respect to information—

(i1) has actual knowledge of the information;

 

(ii2) acts in deliberate ignorance of the truth or falsity of the information; or

 

(iii3) acts in reckless disregard of the truth or falsity of the information;,

and

(B) require no proof of specific intent to defraudis required.;

(A) means includes any request or demand, whether under a contract or otherwise, for money or property and whether or not the United States has title to the money or property, that– 

(i) which is presented to an officer, employee, or agent of the United States; or

 

(ii) is made to a contractor, grantee, or other recipient, if the money or property is to be spent or used on the Government's behaf or to advance a Government program or interest and if United States Government–

(I) provides any portion of the money or property which is requested or demanded;, or

 

(II) if the Government will reimburse such contractor, grantee, or other recipient for any portion of the money or property which is requested or demanded.; and

(B) does not include requests or demands for money or property that the Government has paid to an individual as compensation for Federal employment or as an income subsidy with no restrictions on that individual's use of the money or property;

Sec. 3731.  False claims procedure

(1) more than 6 years after the date on which the violation of section 3729 is committed, or

 

(2) more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the date on which the violation is committed,

whichever occurs last.

Eskiddly oaten doten whoadoat skadeeten datten whatidenchew.

In 1999, the U.S. Department of Justice sued tobacco makers and others for lying about cigarettes — the addictiveness of nicotine, the link between smoking and health problems (including lung cancer), and the safety of "light" and "low tar" taters.  The government alleged that the defendants formed an illegal association-in-fact "enterprise" and engaged in a "pattern of racketeering activity" under the Racketeer-Influenced and Corrupt Organizations Act.

The case went to trial in September 2004.  The non-jury trial lasted nine months.  The government won.

Today, the D.C. Circuit upheld almost all of the judgment.  The opinion decides lots of issues, including whether the defendants could escape liability by claiming that nobody believed their lies and whether the first amendment protects deliberate falsehoods that aim to influence government decisions.  (Answer:  No.)  United States v. Philip Morris USA, Inc., No. 06-5267 (D.C. Cir. May 22, 2009) (per curiam).

Blawgletter notes that A Great Many amici curiae chose to file briefs in support of the district court's judgment, including 35 or so state attorneys-general.  But not the Attorney General of Texas.  Huh?

 Our feed wishes you a terrific Memorial Day weekend.

 
This 1974 bad boy drank 14 gallons per mile.

A federal law can, and often does, set nation-wide standards.  Take the old cap on speed limits.  Between 1974 and 1995, the maximum road velocity ranged from 55 to 65 miles per hour across the U.S.

The example points up a second aspect of nation-wide federal rules.  Before the energy crisis in the early 1970s, state (and local) governments chose their own speed limits.  But then Congress overrode — preempted — them.  Faster state rates fell to federal power in the name of saving fuel.

But federal statutes don't always make the preemptive effect of nation-wide rules clear.  In some cases, Congress says it means to override state and local laws.  In others, it doesn't.  That leaves courts and agencies to sort out whether the law preempts sub-federal rules or not.

The job gets tougher when federal agencies, acting without a clear mandate from Congress, issue rules that conflict with state and local regulations.  Do the new rules preempt sub-federal law?  To the courthouse we go!

Fights over preemption raged more than just about any place else in the area of safety rules.  Each state has its own statutes, regulations, and common law rules on safety.  Does a federal rule that calls for a less stringent standard control?  Or does a tougher state test apply even if it conflicts with the federal one?

In 2001, federal agencies started taking steps to sweep away doubts. Over the ensuing eight years, some — many — issued regulations that outright said they overrode state and local law.

 The executive branch changed course yesterday on preemption.  President Barack Obama sent to the heads of executive departments and agencies a memo instructing them to preempt state law "only with full consideration of the legitimate prerogatives of the States and with a sufficient legal basis for preemption."  It further directed:

1. Heads of departments and agencies should not include in regulatory preambles statements that the department or agency intends to preempt State law through the regulation except where preemption provisions are also included in the codified regulation.

2. Heads of departments and agencies should not include preemption provisions in codified regulations except where such provisions would be justified under legal principles governing preemption, including the principles outlined in Executive Order 13132 [(1999)].

3. Heads of departments and agencies should review regulations issued within the past 10 years that contain statements in regulatory preambles or codified provisions intended by the department or agency to preempt State law, in order to decide whether such statements or provisions are justified under applicable legal principles governing preemption. Where the head of a department or agency determines that a regulatory statement of preemption or codified regulatory provision cannot be so justified, the head of that department or agency should initiate appropriate action, which may include amendment of the relevant regulation.

Blawgletter sees preemption as neither good nor bad as a general rule.  Some things need mandatory nation-wide standards.  Commercial pilot licensing come to mind.  But we do need to balance local needs against federal ones — and to err, if at all, on the side of rules that reflect more local values and priorities.

 Our feed occupies the field.

Jess Bravin of the WSJ writes today that, "[a]s conservatives gear up to oppose President Barack Obama's eventual choice for the Supreme Court, the Republican Party's traditional heart — the business community — is laying low."  He cites "guarded optimism about the president's eventual pick."

What do you think?  Would these short-listers strike a Souter-like — meaning moderate — pose in commercial cases:

• Jennifer Granholm
• Elena Kagan
• Sonia Sotomayor
• Kathleen Sullivan

• Diane Wood

Lest you have any doubt about how far the "plausibility standard" of Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007), will reach, witness what the majority said yesterday on that score in Ashcroft v. Iqbal, No. 07-1015, slip op. at 20 (U.S. May 18, 2009):

Respondent . . . says that our decision in Twombly should be limited to pleadings made in the context of an antitrust dispute. . . . This argument is not supported by Twombly and is incompatible with the Federal Rules of Civil Procedure.  Though Twombly determined the sufficiency of a complaint sounding in antitrust, the decision was based on our interpretation and application of Rule 8.  550 U.S. at 554.  That Rule in turn governs the pleading standard "in all civil actions and proceedings in the United States district courts."  Fed. Rule Civ. Proc. 1.  Our decision in Twombly expounded the pleading standard for "all civil actions," ibid., and it applies to antitrust and discrimination suits alike.  See 550 U.S. at 555- 556 and n. 6.

Blawgletter notes that the author of Twombly, Justice David Souter, wrote the main dissent in Ashcroft v. Iqbal, observing that the "majority . . . misapplies the pleading standard under" Twombly by "looking at the relevant assertions in isolation" and by treating non-conclusory allegations as conclusory.  Ashcroft v. Iqbal, slip op. at 12 & 13 (Souter, J., dissenting).

 A riddle wrapped in a mystery inside an enigma.

A 5-4 majority of the U.S. Supreme Court held today that high federal officials need not answer civil claims over post-9/11 detention policies.  The Court ordered dismissal of a complaint by Javaid Iqbal, a Pakistani, against former Attorney General John Ashcroft and ex-FBI Director Robert Mueller.  Ashcroft v. Iqbal, No. 07-1015 (U.S. May 18, 2009).

Mr. Iqbal alleged that he suffered beating and other harsh treatment after Messrs. Ashcroft and Mueller authorized indefinite holding of terrorism suspects whom the government deemed "of high interest".  His complaint also charged lower-level officials, including prison guards, with brutality.

Mr. Iqbal framed his lawsuit, under Bivens v. Six Unknown Fed. Narcotics Agents, 403 U.S. 388 (1971), as a constitutional tort case to remedy a policy of bias against Arab Muslims and non-U.S. citizens.  He asserted that Messrs. Ashcroft and Mueller okayed the policy "solely on account of religion, race, and/or national origin and for no legitimate penological interest." Id., slip op. at 4-5.

The Court made two key rulings:

1. It rejected "supervisory liability" under Bivens.  "Absent vicarious liability, each Government official, his or her title notwithstanding, is only liable for his or her own misconduct."  Id., slip op. at 13.

2. It held the complaint too vague to make out a "plausible" Bivens claim against Messrs. Ashcroft and Mueller under the "plausible" pleading standard of Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007).  The Court rejected Mr. Iqbal's allegations that Ashcroft and Mueller knew of and condoned a policy of abusing detainees as "conclusory and not entitled to be assumed true."  Id. at 17.  It also deemed the charge of knowing discrimination implausible.  "On the facts respondent alleges the arrests Mueller oversaw were likely lawful and justified by his nondiscriminatory intent to detain aliens who were illegally present in the United States and who had potential connections to those who committed terrorist acts."  Id. at 18.

Justice Kennedy wrote the majority opinion, in which Chief Justice Roberts and Justices Alito, Scalia, and Thomas joined.  Justices Souter and Breyer dissented; all the dissenting justices joined the Souter opinion.

Blawgletter commented last June, when the Court granted review of the Second Circuit's decision in Iqbal, that "perhaps in the 2008 Term we will get some elaboration on the True Meaning of Twombly."  We now have the answer.  Yes.

Elaboration number one:  The Twombly plausibility screen applies in all civil cases.  Id. at 20. 

Elaboration number two:  Twombly requires a two-step approach:  first, ignore "conclusory" allegations and, second, decide if the non-conclusory allegations plead a "plausible" claim.

The test seems to import into the pleading stage a summary judgment-like standard, which calls for proof that shows a "genuine issue of material fact".  Instead of presenting evidence that raises a fact issue after discovery, you may now have to plead that evidence at the outset.