A lawyer’s attempt to hold the federal government liable for violating his privacy and the privacy of “thousands of others” under the Fair Credit Reporting Act hit a major roadblock in the U.S. Supreme Court on Tuesday.
With only five justices on the bench, the Court issued its first and only opinion in an argued case of the term: U.S. v. Bormes, holding that waiver of the government’s immunity depends solely on the text of the Fair Credit Reporting Act.
James Bormes, of counsel at Chicago’s Shannon & Associates, sued the United States in a putative class action, alleging that the electronic receipt he received when he paid a client’s $350-federal court filing fee on Pay.gov violated the law. The receipt contained the last four digits of his credit card and the card’s expiration date.
The FCRA prohibits anyone who accepts credit or debit cards for business transactions to print more than the last five digits of the card number or the expiration date on any receipt at the point of sale or transaction. The act imposes civil liability for willful or negligent noncompliance and permits damages of not less than $100 and not more than $1,000, as well as punitive damages, attorney’s fees and costs.
Bormes filed suit in the district court for the Northern District of Illinois and asserted jurisdiction under FCRA as well as under the so-called Little Tucker Act, which waives the federal government’s sovereign immunity to suit for certain money damages. The district court dismissed the suit, holding that FCRA does not contain the required explicit waiver of sovereign immunity of the United States, but the court did not address the Little Tucker Act as an alternative basis for jurisdiction.
Bormes appealed to the U.S. Court of Appeals for the Federal Circuit. The government sought unsuccessfully to transfer the appeal to the Seventh Circuit. The Federal Circuit vacated the district court decision and held that the Little Tucker Act provided the government’s consent to suit for violation of the FCRA.
The Supreme Court on Tuesday unanimously disagreed.
“Where, as in FCRA, a statute contains its own self-executing remedial scheme, we look only to that statute to determine whether Congress intended to subject the United States to damages liability,” wrote Justice Antonin Scalia for the court.
Plaintiffs, he said, cannot mix and match FCRA’s provisions with the Little Tucker Act’s immunity waiver to create an action against the United States. “Since FCRA is a detailed remedial scheme, only its own text can determine whether the damages liability Congress crafted extends to the Federal Government,” said Scalia.
The justices did not decide whether FCRA itself waives the government’s immunity to damages actions, but remanded that question to the Seventh Circuit. John Jacobs of Chicago’s Jacobs Kolton represented Bormes.
In the prosecutorial misconduct case—Shaygan v. U.S.—the justices declined to review a dispute over sanctions for alleged prosecutorial misconduct, leaving in place a controversial ruling in the U.S. Court of Appeals for the Eleventh Circuit that sets a high bar for the recovery of legal fees flowing from government malfeasance.
Lawyers for Miami doctor Ali Shaygan had urged the high court to strike down the appellate decision, saying it set a new, unjustified hurdle for defendants to prevail in an action for attorney fees under the Hyde Amendment. The trial judge in Shaygan’s case had ordered the government to reimburse nearly $602,000 to Shaygan.
Federal law allows defendants to recoup fees in cases where the government position was “vexatious, frivolous or in bad faith.” But the statute doesn’t define the terms. The Eleventh Circuit said a defendant must show that a prosecution itself—rather than particular, individual wrongs within a case—lacked probable cause. The Hyde Amendment, the appeals court said, is concerned with “wrongful” prosecutions.
The appeals court struck down an order from the trial judge, Alan Gold of the U.S. District Court for the Southern District of Florida. Gold based his sanctions decision on a number of things—including the government’s pursuit of a superseding indictment against Shaygan and the government’s decision to initiate a witness-tampering probe targeting David Markus, Shaygan’s defense attorney.
The Supreme Court rejected a petition from Markus without comment. Justice Elena Kagan did not participate in the consideration or decision of the petition. “We are extremely disappointed that the Court decided not to review the case when there was so much support from so many different groups—doctors, surgeons, prosecutors, judges, defense lawyers, to name a few,” Markus said in an email. “It’s become harder to get into the Supreme Court than Willy Wonka’s chocolate factory.”
Markus, of Miami’s Markus & Markus, also said “No one can ever take away the fact that Dr. Shaygan was found not guilty of 141 counts that never should have been brought in the first place.”
A group of more than 50 former federal judges and prosecutors participated in the dispute in the high court in a friend-of-the-court brief. The group, represented by Thomas Goldstein of Washington D.C.’s Goldstein & Russell, called the Eleventh Circuit decision “a bolt from the blue.”
“If allowed to stand, the Eleventh Circuit’s holding will disempower district judges, and send a clear signal that even grave prosecutorial misconduct will generally be overlooked, given the relatively lax standards for instituting federal prosecutions,” Goldstein wrote in the brief. “When a court bends the law to excuse a prosecutor’s bad faith, public confidence in the criminal justice system suffers.”