Will Congress Rebuff the Supreme Court's Anti-Consumer Activism?

The fractious finish of the Supreme Court's 2007-2008 term, coupled with new rumblings on Capitol Hill and the prospect of expanded Democratic gains in November, suggest that we could be at the brink of an epochal clash between the Court and the elective branches of government.

Today, Senate Judiciary Committee Chair Patrick Leahy will hold the second in a planned series of hearings designed, as he stated in opening the first hearing, on June 11, "to shine a light on how the Supreme Court's decisions affect Americans' everyday lives." Noting that, especially in today's distressed economy, citizens are preoccupied with health care coverage, retirement uncertainty, and credit card, home mortgage, and other monthly payments, Leahy observed, "Congress has passed laws to protect Americans in these areas, but in many cases, the Supreme Court has ignored the intent of Congress."

The Court's campaign against individual court enforcement of consumer, employee, retiree, and other statutory protections has been a secret hiding in plain sight for the last four decades. During that period, in which Republican presidents selected 12 Supreme Court justices and Democrats managed only two, business community advocates have repeatedly asked the Court to water down or neutralize laws enacted by progressive congressional majorities. More and more, conservative Supreme Court majorities have done just that, "Oftentimes," as Leahy said, "turning these laws on their heads, and making them protections for big business rather than ordinary citizens." In the last two Supreme Court terms, the National Chamber of Commerce participated in 29 cases (nearly one third of the 97 civil cases the Court decided in that period) and won 20 of them.

The case of Maureen Kurtek, who testified before the Judiciary Committee on June 11, illustrates the senator's point. Ms. Kurtek is a 44 year old wife, mother, and former nurse who suffers from lupus, a chronic disease that attacks the immune system. Beginning in 1998, her lupus had been held at bay by three biannual treatments prescribed by her physician; each of the three $14,000 treatments was fully paid for by the insurer handling the employee benefit plan of her husband's employer. But in late 2002 her husband changed jobs, and the new employer's benefit provider, Capitol Blue Cross, balked. The insurer stonewalled her urgent requests to authorize a fourth treatment, insisting that the company was "investigating," though never once contacting her physician who had prescribed the treatment. After nearly three months, deterioration of Ms. Kurtek's immune system triggered septic shock and multiple organ failure, forcing her into emergency hospitalization. She barely survived, but not before she had suffered irreversible, gruesome injury. "I stand before you," she told the Committee, "with a tracheotomy scar on my neck, five amputated finger tips, and an amputated right foot where I still experience phantom pains."

The Kurtek family went to court, but the U.S. Court of Appeals for the Third Circuit in Pennsylvania rejected her suit. Reluctantly, the Third Circuit ruled that the Supreme Court's b unjust and tangledb interpretation of the 1974 federal Employee Retirement Income Security Act (ERISA) (in 1993 and 2002 decisions authored by Justice Antonin Scalia) barred any monetary compensatory relief, and, further (in a 2004 decision by Justice Clarence Thomas) that ERISA "preempted" (i.e., invalidated) claims for compensation under state negligence and trust law.

The Kurteks are typical victims of what Jacob Hacker has called "The Great Risk Shift" from business and government to individuals that, through the last four decades, has pushed millions of workers and families up to or over the edge of catastrophe. Democrats often wonder why so many once-loyal voters in this demographic no longer correlate Democratic political success with their own economic and health security. Part of the answer, no doubt, is that programs that Democratic Congresses have written into law have not always delivered tangible benefits on the ground. Understandably, Maureen Kurtek blames her plight on "this law" -- ERISA. No one has explained to her, or to the millions like her with a stake in the matter, that Democratic Congresses crafted and passed this law to achieve precisely the opposite result. By turning it and other progressive reforms "upside down," the Supreme Court has not only converted intended beneficiaries into victims, it has helped to undermine the Democrats' brand as reliable guardians of middle America's basic needs.

On the very last day of the 2007-2008 term the Court definitively shut the door on all hopes for judicial restoration of Congress' protective intent in applying ERISA to claimants like Maureen Kurtek. Early this year, the Court had received a petition to review a decision by the Fifth Circuit Court of Appeals decision rejecting redress for a widow who had been denied, on the basis of a hyper-technical requirement, $400,000 in life insurance benefits due under her late husband's employer-sponsored benefit plan. Her husband's employer had never informed him of the requirement, refused to provide to him the life insurance plan documents that would have exposed it, and repeatedly assured him he remained covered after the company switched insurers to Aetna from another insurance company. These failures constituted clear violations of ERISA. The Fifth Circuit nevertheless concluded that the Supreme Court's prohibition of monetary relief required denial of the widow's claim. A concurring judge wrote that the circumstances of the case "scream out" for change in the Supreme Court's rules. In a brief solicited by the Court, the Bush Administration vigorously urged the Court to heed that unusually blunt judicial imprecation, and revitalize remedies for employees wrongfully denied retirement and health benefits. But on June 27, the Court denied review, turning a deaf ear to these and numerous other similar pleas for reform.

As the Court continues thus to upend congressional efforts to protect individual and family pocket book interests, Congress appears at last to be beginning to sit up and take notice. In addition to Senator Leahy's series of hearings, House Oversight and Government Reform Committee Chair Henry Waxman held a May hearing to challenge the Court's March 2008 decision (critically reviewed here in American Prospect Online) to effectively abolish state protections against negligent marketing of federally approved medical devices such as heart defibrillators and catheters. Bills to overturn the Court's binding mandatory arbitration rulings, which shunt consumer and employment grievances into rigged private dispute resolution systems, boast seven senate sponsors and forty House sponsors. Noting the epidemic of decisions "that undercut the original intent of the law," senior House Democrat Howard Berman told Roll Call's Tory Newmyer that Congress needs to act "to make clearer what that intent was."

This will be no easy task, even if Barack Obama gains the White House and Democratic margins in the House and Senate grow. Even when public support can be mobilized sufficient to overcome interest group opposition to corrective legislation, and even if congressional drafters skillfully close loopholes exploited by the Court's misinterpretations, a resolute and ideologically hostile judiciary will retain cards to trump their efforts. The provisions of major statutory schemes like ERISA, the Civil Rights Acts, or the securities laws necessarily contain ambiguities and empty spaces that give judges wide running room to interpret. If Congress cannot trust federal judges to act as partners, promoting statutory goals in good faith, harsh inter-branch confrontation will top the horizon. In the second decade of the 21st century, relations between the Supreme Court and the political branches could echo Franklin Roosevelt's "court-packing" row with the anti-New Deal Supreme Court of the 1930s, or Thomas Jefferson's drive to marginalize lame-duck President John Adams "midnight" appointees to Chief Justice John Marshall's Federalist Court of the early 1800s.

However, this last term did yield some promising evidence that Congress can avert such apocalyptic scenarios. One year ago, in July 2007, the House quickly overturned the Court's May 2007 5-4 Ledbetter decision, which weakened equal pay guarantees of the 1964 Civil Rights Act and ignored a 1991 amendment passed to reverse a similar decision by the Rehnquist Court. This "fix" legislation is still blocked by a filibuster in the Senate. But an impressive tally of 57 senators supported the first and so far only attempt at cloture. And public anger about the simple injustice of Ledbetter has continued to resonate, reflected in Republican senators' discomfort with the decision and in presumptive presidential nominee Barack Obama's increasingly frequent denunciations of it. All this political commotion may have influenced Roberts and Alito during the just-completed 2007-2008 term to bow to well-established precedent and issue several surprising rulings in favor of employment discrimination plaintiffs.

In sum, after decades of congressional inattention to judicial mishandling of Congress' legislative handiwork, Senator Leahy's hearings are a promising departure. But the Court's obstructionist campaign is already far along. To restore existing statutory guarantees, and ensure forthright implementation of new legislative reforms, Congress will need to demonstrate why, in the 21st century the Supreme Court remains what Alexander Hamilton in the 18th called the "least dangerous branch."

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