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On the heels of solid victories at the U.S. Supreme Court last term, business hopes to build another winning record in the new term. But it’s aiming for victory in a broader array of cases, involving intellectual property, class actions, banking, arbitration and environmental regulation. In the term that opens on Oct. 2, nearly half of the 34 cases already slotted for review by the justices have potential ramifications for the day-in, day-out operation of businesses. “These are big and important cases,” says veteran high court advocate John G. Roberts of Washington, D.C.’s Hogan & Hartson, who will argue two of the 34. “You hear a lot of criticism that the court likes the glamorous cases. But look at the first case the court is going to hear.” He is referring to Gitlitz v. Commissioner of Internal Revenue, No. 99-1295, involving the tax treatment of discharged indebtedness by an insolvent Subchapter S corporation. “It’s not a glamorous one, but a question the justices really need to address. So they’re doing their job of resolving circuit conflicts.” The business cases also are more diversified than last term’s lot, says Robin Conrad, senior vice president of the National Chamber Litigation Center. “That makes me think it will be a more interesting term.” For the chamber — indeed for the many businesses that cope with federal regulations — the case with the “greatest potential ramifications,” says Conrad, is Browner v. American Trucking Associations, No. 99-1257, as well as a companion case, American Trucking Associations v. Browner, No. 99-1426. In those two cases, the court will examine whether Congress unconstitutionally delegated legislative power to the Environmental Protection Agency under the Clean Air Act and whether regulatory agencies can use a cost-benefit analysis, among other factors, when setting regulatory standards. “These cases are particularly important in terms of the breadth of the economy they address and the compliance costs involved for business,” Conrad says. Although he hasn’t plotted the trend statistically, another veteran Supreme Court practitioner, Alan Untereiner of the Washington, D.C., office of Chicago’s Mayer, Brown & Platt, says his sense is that business is doing better generally in the Rehnquist Court. That may have something to do with the newest justices, he suggests. “Justice [Ruth Bader] Ginsburg takes legal argumentation and arguments about method very seriously, and she is concerned to decide cases narrowly,” he explains. “Justice [Stephen G.] Breyer has a very sophisticated understanding of the complexity of modern regulation. Justice [David H.] Souter’s opinion in last term’s HMO case reflects a very nuanced understanding of how health care works and the social choices that are made in designing an HMO system.” Last term was a “very solid term for business,” says Untereiner. And if the justices agree to add the government’s antitrust battle with Microsoft Corp. to its agenda, he says, “an already important term will become enormously important.” SEPARATING POWER The Browner cases involve Section 109 of the Clean Air Act, which directs the Environmental Protection Agency to set national ambient air-quality standards to protect the public health and welfare. The U.S. Court of Appeals for the District of Columbia rejected the EPA’s 1997 revised standards for ozone and particulate matter. It held that the EPA’s interpretation of its authority under Section 109 made that provision an unconstitutional delegation of legislative power. The court said that the agency’s interpretation would allow it to set standards at “any point between zero and a hair below the concentrations yielding London’s killer fog.” The D.C. Circuit also held — this is being appealed in the second Browner case by American Trucking Associations — that the EPA cannot consider the cost of implementing the air quality standards when it is setting the standards, only the health effects. The EPA cases raise the “very important issue of just how Congress should relate to the independent federal agencies under the Constitution,” says high court scholar Thomas Baker of Drake University Law School’s Constitutional Law Resource Center. “The question of whether Congress is passing the buck to these agencies has the potential for having the greatest impact in all of these cases.” The chamber’s Conrad says she doesn’t believe that the cases threaten to end the administrative state. “They’re not that broad,” she says. “But they’re very important in terms of the exercise of unbridled authority by administrative agencies, an issue we face with [the Occupation Safety and Health Administration] and a number of agencies.” Buckman v. Plaintiffs’ Legal Committee, No. 98-1768, is also about the proper allocation of authority, but in the federal-state context. In Buckman, a challenge out of the 3rd Circuit, the justices will decide whether the federal Medical Device Amendments of 1976 pre-empt state-law tort claims alleging that the Buckman Co. deceived the Food and Drug Administration during the process for obtaining approval to market orthopedic bone screws. The underlying class action involves thousands of plaintiffs who claim that they suffered injuries resulting from the implantation of the bone screws into the pedicles of their spines. The 3rd Circuit found that the state-law “fraud on the agency” claims were neither expressly nor impliedly pre-empted by federal law. The court relied on a key high court precedent — Medtronic v. Lohr, 518 U.S. 470 (1996). The state-law fraud-on-the-agency claim is potentially available in a wide range of pre-emption contexts, including telecommunications and boat safety, says Untereiner, whose partner, Kenneth Geller, is representing the Buckman Co. before the high court. ARBITRATING PROBLEMS The justices this term also will decide a trio of arbitration cases. In E astern Associated Coal Corp. v. UMW, District 17, No. 99-1038, the justices will decide whether a court can overrule an arbitrator’s decision to reinstate an employee to a safety-sensitive job after the employee tested positive for drug use. In Circuit City Stores Inc. v. Adams, No. 99-1379, the court will examine the Federal Arbitration Act to decide whether it applies to employment contracts. And in Green Tree Financial Corp. v. Randolph, No. 99-1235, the justices face several questions, including whether an arbitration provision that is silent on costs and fees is enforceable under the Federal Arbitration Act. “Employers are sort of caught between the rock and hard place — facing liability when trying to get rid of a bad actor and facing arbitrators who are trying to reinstate the employee,” says Roberts, who is representing Eastern. “What does a court do in that situation? The issue comes up over and over again, in the drug use and safety arena, and even in sexual and racial harassment.” Other cases to watch this term for their impact on business include: � U.S. v. Mead Corp., No. 99-1434: Mead challenged the U.S. Customs Service’s classification of its imported day planners as “bound diaries” subject to a tariff. The justices will decide whether courts reviewing these classifications must defer to the service’s rulings. � Missouri Director of Revenue v. CoBank ACB, No. 99-1792: Missouri and 22 other states, along with the private banking industry, want farmer-owned lending cooperatives — entities established by federal charter — to pay state income taxes. � TrafFix Devices Inc. v. Marketing Displays Inc., No. 99-1571: The case is at the intersection of trade dress and patent protection. The justices will decide whether federal trade dress protection extends to product configurations that had been covered by an expired utility patent. � Egelhoff v. Egelhoff, No. 99-1529: The court will determine whether the Employee Retirement Income Security Act pre-empts a state law that requires ERISA plan benefits to be paid to someone other than the designated beneficiary.
U.S. Supreme Court: Year in Review. Free Program. September 11-26.

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