Congressional Court Watcher: Recent Appellate Decisions of Interest to Lawmakers (June 26, 2023–July 2, 2023), Part 2

Legal Sidebari

Congressional Court Watcher: Recent

Appellate Decisions of Interest to Lawmakers

(June 26, 2023–July 2, 2023), Part 2

July 3, 2023

The federal courts issue hundreds of decisions every week in cases involving diverse legal disputes. This

Sidebar series selects decisions from the past week that may be of particular interest to federal lawmakers,

focusing on orders and decisions of the Supreme Court and precedential decisions of the courts of appeals

for the thirteen federal circuits. Selected cases typically involve the interpretation or validity of federal

statutes and regulations, or constitutional issues relevant to Congress’s lawmaking and oversight

functions.

Some cases identified in this Sidebar, or the legal questions they address, are examined in other CRS

general distribution products. Members of Congress and congressional staff may click here to subscribe to

the CRS Legal Update and receive regular notifications of new products and upcoming seminars by CRS

attorneys.

This week’s Congressional Court Watcher is divided into two parts because of the number of notable

decisions issued over the past week. This Legal Sidebar (Part 2) discusses activity by the U.S. courts of

appeals from June 26 through July 2, 2023, while a companion Legal Sidebar (Part 1) addresses Supreme

Court decisions from this period.

Decisions of the U.S. Courts of Appeals

Topic headings marked with an asterisk (*) indicate cases in which the appellate court’s controlling

opinion recognizes a split among the federal appellate courts on a key legal issue resolved in the opinion,

contributing to a non-uniform application of the law among the circuits.

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Arbitration: The Third Circuit affirmed the denial of a motion to dismiss a lawsuit by an

employee for breach of fiduciary duties against his employer and the trustee of an

employee stock ownership plan (ESOP) under the Employment Retirement Income

Security Act (ERISA). The defendants argued that the ESOP’s plan documents contained

an arbitration provision with a class action waiver. The court held that the class action

waiver bars plaintiffs from seeking remedies guaranteed by ERISA, and, accordingly, the

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waiver is unenforceable. Considering the defendants’ concession that the class action

waiver was nonseverable from the rest of the arbitration provision, the court also ruled

the arbitration provision is void in its entirety (Henry v. Wilmington Tr., NA).

*Bankruptcy: The Tenth Circuit held that the government’s waiver of sovereign

immunity in § 106(a) of the Bankruptcy Code extends to claims by a trustee proceeding

under § 544(b)(1) to void a transfer of property—here tax payments to the Internal

Revenue Service—under state law. The court found the plain language of the waiver

broadly extended to state law claims that formed the “applicable law” under § 544. The

decision widens a circuit split, with the Tenth Circuit agreeing with the Fourth and Ninth

Circuits’ reasoning and departing from the analysis of the Seventh Circuit (Miller v.

United States).

Civil Rights: The Sixth Circuit held that the Michigan Department of Corrections’ denial

of recognition to an “explicitly racist” religion violated the Religious Land Use and

Institutionalized Person Act of 2000, 42 U.S.C. § 2000cc-1. The court held that the

Department had not shown that nonrecognition was the least restrictive means to support

the Department’s interest in security, particularly when the Department had not

considered other alternatives. The court declined to reach the question of whether a broad

concern about prison violence was sufficiently specific to show that the Department had a

compelling governmental interest (Fox v. Washington).

Communications: The Ninth Circuit reversed the dismissal, for lack of Article III

standing, of an action brought under the Telephone Consumer Protection Act of 1991

(TCPA) by a mother after receiving unsolicited telemarketing calls and texts on a phone

used primarily by her child. The court held that the owner of a phone with a number

listed on the National Do-Not-Call Registry suffers an injury in fact sufficient for

standing even when she is not the phone’s primary or customary user (Hall v. Smosh Dot

Com, Inc.).

Criminal Law & Procedure: The Second Circuit held that dismissals of lawsuits as

barred by res judicata and dismissals on alternative grounds can count against prisoners

when applying the Prison Litigation Reform Act’s (PLRA’s) three-strikes rule. The threestrikes rule largely bars prisoners from proceeding in forma pauperis if courts have

dismissed three of their prior legal actions or appeals as frivolous, malicious, or failing to

state a claim. Here, the court held that a prisoner accrues a strike when, on the face of his

complaint, the action is plainly barred by res judicata. A prisoner also accrues a strike, the

court held, when a court dismisses a case citing multiple alternative grounds, so long as

one of the grounds would independently justify a strike and sufficed for dismissal of all

claims (Griffin v. Carnes).

Criminal Law and Procedure: The Eighth Circuit affirmed a defendant’s convictions

and mandatory life sentence for distributing a controlled substance resulting in death. The

defendant argued that the mandatory life sentence unconstitutionally violated equal

protection principles because, after the First Step Act, drug traffickers convicted under

21 U.S.C. § 841(b)(1)(A) and (B) are subject to a mandatory life sentence only if they

have prior “serious drug felony” or “serious violent felony” convictions, while those, like

the defendant, convicted under lower quantity thresholds in § 841(b)(1)(C) are subject to

a mandatory life sentence if they have any prior convictions for “felony drug offenses.”

The Eighth Circuit held that a rational basis exists for this distinction based on Congress’s

conceivable intent to provide harsher punishments for street-level traffickers who directly

sell smaller quantities to individuals and the drug use results in death (United States v.

Cardwell).

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Election Law: The Fifth Circuit held that three Texas electioneering laws do not violate

the First Amendment. The Texas Election Code bars loitering or electioneering within

100 feet of a polling place during general and primary elections, and also prohibits

wearing certain insignia relating to a candidate, measure, or political party that appears

on the ballot within 100 feet of a polling place. The district court upheld the prohibition

on the wearing of certain insignia as constitutional, but concluded that the Election

Code’s challenged restrictions on loitering or electioneering chilled the plaintiff’s right to

free speech by criminalizing political expression at polling places without limiting

language. The Fifth Circuit reversed, first holding that the plaintiff lacked standing with

regard to state election officials. With respect to local officials, the court held that the

First Amendment claims failed because the challenged laws contain sufficient limiting

language to provide an “objective, workable standard” (Ostrewich v. Nelson).

Environmental Law: The D.C. Circuit denied petitions for review raising a challenge to

the Environmental Protection Agency’s (EPA’s) Aircraft Rule, which aligns domestic

aircraft emission standards with those promulgated by the International Civil Aviation

Organization (ICAO). The court held that the Aircraft Rule was within the EPA’s

Authority under § 231 of the Clean Air Act, and that the EPA reasonably explained its

decision to comport its regulation with the ICAO standards (California v. EPA).

Congress: The D.C. Circuit affirmed the dismissal of a lawsuit by multiple Members of

the U.S. House of Representatives against the former Speaker of the House and other

congressional defendants challenging the requirement that people in the House chamber

wear masks or be fined. The court held that the adoption and execution of that

requirement were legislative acts that fell under the House’s authority to determine the

rules of its proceedings and punish its Members for disorderly behavior. As a result, the

court reasoned, the Constitution’s Speech or Debate Clause conferred immunity on the

defendants (Massie v. Pelosi).

*Immigration: The Second Circuit added to a circuit split as to whether an immigration

judge may deny adjustment of status to an applicant who had filed a frivolous, but

untimely, asylum application. Generally, a person who knowingly files an asylum

application containing false, material statements is considered to have filed a frivolous

application and is permanently barred from immigration benefits. The court disagreed

with the Third Circuit and held that an asylum application can be found frivolous even if

it was untimely filed. The court explained that the federal statute on frivolous asylum

applications contains no clear statement that the asylum application filing deadline is

jurisdictional, thus requiring immigration judges to consider an application’s timeliness

before analyzing for frivolousness. The court determined that the filing of an asylum

application, timely or otherwise, is the only precondition to triggering a frivolousness

inquiry (Ud Din v. Garland).

Indian Law: The Seventh Circuit held that the antiretaliation provision of the False

Claims Act does not abrogate tribal sovereign immunity. In a suit brought by a former

employee against a tribal health center and related defendants, the Seventh Circuit

rejected the abrogation argument and affirmed a district court’s order dismissing the

claims, concluding that the health center acted as an arm of the tribe and was therefore

entitled to avail itself of tribal sovereign immunity (Mestek v. Lac Courte Oreilles Cmty.

Health Ctr.).

Indian Law: The Tenth Circuit held that the city of Tulsa did not have jurisdiction over

municipal violations committed by its Indian inhabitants in Indian Country. The plaintiff,

a resident of Tulsa and a member of the Choctaw Nation, challenged a citation for

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speeding issued by Tulsa within the Muscogee Indian Reservation. A lower court found

that Tulsa properly exercised jurisdiction stemming from Section 14 of the Curtis Act, an

1898 federal statute granting lawmaking authority and jurisdiction to municipalities

organized under Arkansas law within what was then known as “Indian Territory.” The

Tenth Circuit reversed, holding that even if the Curtis Act was never repealed, it no

longer applied to Tulsa after the city reorganized under Oklahoma law (Hooper v. The

City of Tulsa).

Indian Law: The D.C. Circuit held that the Secretary of the Interior did not violate the

Indian Gaming Regulatory Act (IGRA), a law that regulates gaming on Indian lands, in

allowing a compact between the Seminole Tribe of Florida and the State of Florida to

become effective by operation of law. At issue was the compact’s providing for online

sports betting, meaning that people could gamble outside of Indian lands. The court held

that while IGRA regulates gaming solely on Indian lands, nothing in the statute prohibits

tribes and states from entering into a compact that discusses gaming outside of Indian

lands. Additionally, the court held that the Secretary did not violate the Wire Act, the

Unlawful Internet Gambling Enforcement Act, or the equal protection guarantee of the

Fifth Amendment in allowing the compact to go into effect (W. Flagler Assocs., Ltd. v.

Haaland).

Property: The Federal Circuit held that the federal government may be liable under the

Fifth Amendment’s Takings Clause if it fails to return property seized during a criminal

investigation and does not validly assume ownership of the property via forfeiture. The

court explained that while the government’s police power may insulate it from liability

for an initial seizure, there is no police power exception that insulates law enforcement

from takings liability for the period after seized property is no longer needed for criminal

proceedings. The court agreed with the Third Circuit that the government needs some

justification to retain seized property without compensation once criminal proceedings

have concluded (Jenkins v. United States).

Tax: The D.C. Circuit reversed a grant of summary judgment for a company in an action

brought by one of the company’s employees for willfully filing fraudulent information

returns (W-2s) on his behalf, under 26 U.S.C. § 7434. The parties disagreed about the

requisite scienter, or mental state, required under the statute. Observing that Congress

defined neither “willfully” nor “fraudulent” in § 7434, the court applied the statutory

interpretation principle that, absent other indication, Congress intends to incorporate the

well-settled meaning of common law terms. The court then applied the common law

usages of “willfully” and “fraudulent” and held that under § 7434, a plaintiff must show

that a defendant acted knowingly or recklessly in filing a false return on someone’s behalf

(Doherty v. Turner Broad. Sys., Inc.).

Torts: The Ninth Circuit joined a growing circuit consensus in holding that

Transportation Security Officers (TSOs) are “law enforcement officers” under the Federal

Tort Claims Act (FTCA), 28 U.S.C. § 2680(h), which waives sovereign immunity for

torts like assault and battery committed by such officers. The court found that under the

plain language of the FTCA, TSOs conduct searches and make arrests for violations of

federal law, meeting the definition of “law enforcement officers.” The court thus allowed

to proceed the plaintiff’s claim against the United States that she was sexually assaulted

by a TSO at an airport screening (Leuthauser v. United States).

*Transportation: The D.C. Circuit maintained its position in a circuit split concerning

the scope of appellate jurisdiction over decisions of the Surface Transportation Board

(STB) under the Hobbs Act, 28 U.S.C. §§ 2341-51. The Hobbs Act, along with 28 U.S.C.

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§ 2321, confers appellate courts with jurisdiction to review all final STB orders; however,

28 U.S.C. § 1336 vests a district court with exclusive jurisdiction to review questions it

certifies to the STB. Here, the D.C. Circuit held that where a district court certifies a

question to the STB, an appellate court has jurisdiction to review any additional issues

decided by the STB (Norfolk S. Ry. Co. v. Surface Transp. Bd.).

Author Information

Jimmy Balser

Legislative Attorney

Alexander H. Pepper

Legislative Attorney

Michael D. Contino

Legislative Attorney

Matthew D. Trout

Legislative Attorney

Congressional Research Service

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