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In a case watched closely by privacy and whistleblower advocates, lawyers for an HIV-positive pilot and the federal government clashed in the U.S. Supreme Court on Wednesday over whether damages for mental and emotional distress can be recovered for violations of the Privacy Act. The justices gave little hint of how they would rule in a classic statutory interpretation argument over the meaning of the words “actual damages” in the 1974 law. Enacted in the wake of the Watergate scandal and amid growing concerns about government use of computerized databases, the law prohibits federal agencies from disclosing “any record which is contained in a system of records” to any person or to another agency without the consent of the individual to whom the record pertains. It creates a private cause of action against an agency for willful and intentional violations and authorizes actual damages of no less than $1,000. During Wednesday’s arguments, Assistant to the Solicitor General Eric Feigin told the justices, “If Congress had intended to waive the sovereign immunity of the United States to allow uncapped emotional distress claims under the Privacy Act, it would have and was required to state that waiver clearly and unambiguously in the statutory text.” The term “actual damages” is ambiguous, and where the term is ambiguous, he argued, the rule is to “construe waivers of sovereign immunity narrowly.” But the pilot’s counsel, Raymond Cardozo, head of Reed Smith’s appellate group, countered, “The government’s view would mean the very individuals Congress sought to protect would have no remedy at all for the primary form of harm that was well recognized at common law when this act was passed. Today the government is proposing that actual damages be read in a way that makes the act irrelevant.” The case, Federal Aviation Administration v. Cooper, stems from a joint criminal investigation, known as Operation Safe Pilot, by the inspectors general of the U.S. Department of Transportation and the Social Security Administration (SSA) in 2002. They sought out medically unfit persons who received Federal Aviation Administration certifications to fly. The FAA fed the names of about 45,000 pilots in northern California to the SSA to check on who had received disability benefits. One of the roughly 3,000 violators was Stanmore Cooper, a private recreational pilot since 1964. Cooper was diagnosed with HIV in 1985. He received disability benefits in 1995-96 when his condition worsened. He withheld information about his condition when he renewed his medical certificate with the FAA in 1994, 1998, 2000, 2002 and 2004. He said he feared discrimination if he disclosed his HIV status. Cooper was indicted on three counts of making false statements to a government agency and he pleaded guilty to one count of making a false official writing–a misdemeanor. He was sentenced to two years of unsupervised probation and fined $1,000. In 2007, Cooper sued the FAA, the SSA and the Transportation Department for willful and intentional violation of the Privacy Act by sharing his medical record without his consent. He said he had suffered humiliation, mental anguish, fear of social ostracism and other severe emotional distress. The trial court dismissed his lawsuit after finding that the Privacy Act did not authorize recovery for noneconomic injuries. The U.S. Court of Appeals for the 9th Circuit disagreed and reversed. There is a long-standing circuit court split over whether the act permits noneconomic damages. Feigin, the government’s attorney, faced his most skeptical questioning from Justice Ruth Bader Ginsburg who told him, “The injury, the invasion of privacy, that’s not something where pecuniary damages are prime, if they exist at all. The person who is subject to this embarrassment, this humiliation, doesn’t have out-of-pocket costs, but is terribly distressed, nervous, anxious, and all the rest. If Congress wanted to do something about the impact on the person it has given a right, it’s not going to do something that has to do with pecuniary damages that a person in this plaintiff’s situation is not likely to suffer.” But Feigin said the act’s text demonstrates that Congress thought about providing an emotional distress award but decided against it in the act’s initial version. Instead, Congress directed the Privacy Protection Study Commission in the text of the act to make a recommendation on whether the act should be expanded later to include the broader term “general damages.” He then faced a series of questions about the meaning at common law of general, special and actual damages. Cooper’s counsel, Cardozo, urged the justices to give the term “actual damages” their common and ordinary meaning which, he argued, is simply proven, not presumed, damages. “The term of art for economic loss in this arena is ‘special damages,’ ” he said. “ If that’s what Congress meant, presumably it would have used that term.” But Justice Antonin Scalia noted there are many other definitions of actual damages. If the meaning of the term is not clear, he said, “Then you trigger the rule that waivers of sovereign immunity will not be considered to have any scope except that scope which is clear.” Cardozo responded that there is no ambiguity when the term is read in the context of the statute’s purpose, legislative history and breadth of its waiver of the government’s sovereign immunity. The government’s argument that the act authorizes only economic damages “is a square peg in a round hole,” he said. Marcia Coyle can be contacted at [email protected].

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