Case Highlights
2004-2005 Term
Following are case highlights for the topic areas of Commerce, Commerce Clause, Communications Act, Consumer Law, and Copyright. To access other case highlights for the 2004-2005 Term or other terms, or to return to the main Case Highlights page, use the Topic Area menu to the right.
COMMERCE CLAUSE
COMMERCE CLAUSE
American Trucking Associations Inc. et al. v. Michigan Public Service Commission et al.
Docket No. 03-1230
Affirmed: The Court of Appeals of Michigan
Argued: April 26, 2005
Decided: June 20, 2005
For Case Analysis: See ABA Preview 410
Does the flat $100 fee that Michigan charges trucks engaging in intrastate commercial hauling violate the dormant Commerce Clause?
No. The Michigan fee does not facially discriminate against interstate or out-of-state activities or enterprises.
From the opinion by Justice Breyer (joined by Chief Justice Rehnquist and Justices Stevens, O'Connor, Kennedy, Souter, and Ginsburg):
The present fee, as we have said, taxes purely local activity; it does not tax an interstate truck's entry into the State nor does it tax transactions spanning multiple States. … We lack convincing evidence showing that the tax deters, or for that matter discriminates against, interstate activities. … Nor is the tax one that, on its face, would seem to call for an assessment measured per mile rather than per truck. … Consequently, we lack any reason to infer that Michigan's lump-sum levy erects … an impermissible discriminatory road block.
Concurring: Justice Scalia
Concurring: Justice Thomas
COMMERCE CLAUSE
Granholm et al. v. Heald et al.
and
Michigan Beer & Wine Wholesalers Ass'n v. Heald et al.
and
Swedenburg et al. v. Kelly
Docket Nos. 03-1116, 03-1120 and 03-1274
Affirmed: The Sixth Circuit in Nos. 03-1116 and 03-1120
Reversed: The Second Circuit in 03-1274
Argued: December 7, 2004
Decided: May 16, 2005
For Case Analysis: See ABA Preview 177
Does a state law that permits in-state wineries to ship alcohol directly to consumers but restricts the ability of out-of-state wineries to do so violate the Commerce Clause in light of Section 2 of the Twenty-first Amendment?
Yes. Both states' laws discriminate against interstate commerce in violation of the Commerce Clause and this discrimination is neither authorized nor permitted by the Twenty-first Amendment.
From the opinion by Justice Kennedy (joined by Justices Scalia, Souter, Ginsburg and Breyer):
States have broad power to regulate liquor under §2 of the Twenty-first Amendment. This power, however, does not allow States to ban, or severely limit, the direct shipment of out-of-state wine while simultaneously authorizing direct shipment by in-state producers. If a State chooses to allow direct shipment of wine, it must do so on evenhanded terms. Without demonstrating the need for discrimination, New York and Michigan have enacted regulations that disadvantage out-of-state wine producers. Under our Commerce Clause jurisprudence, these regulations cannot stand.
Dissenting: Justice Stevens (joined by Justice O'Connor)
Dissenting: Justice Thomas (joined by Chief Justice Rehnquist, and Justices Stevens and O'Connor)
COMMERCE CLAUSE
Mid-Con Freight Systems, Inc. et al. v. Michigan Public Service Commission et al.
Docket No. 03-1234
Affirmed: The Court of Appeals of Michigan
Argued: April 26, 2005
Decided: June 20, 2005
For Case Analysis: See ABA Preview 410
Is a Michigan law that imposes an annual fee of $100 upon each Michigan license-plated truck that is "operating entirely in interstate commerce" preempted by a federal statute that provides that "a State registration requirement" is an unreasonable burden upon interstate commerce when it imposes so high a fee?
No. The Michigan fee requirement is not the kind of "State registration requirement" to which the federal statute refers.
From the opinion by Justice Breyer (joined by Justices Stevens, Scalia, Souter, Thomas, and Ginsburg):
Reference to text, historical context, and purpose discloses that the words "State registration requirement" do not apply to every State Registration requirement that happens to cover interstate carriers, nor to every such requirement specifically focused on a trucking operation's interstate character. Rather, they apply only to those state requirements that concern [Single State Registration System (SSRS)] registration—that is, registration with a State of evidence that a carrier possesses a Federal Permit, registration of proof of insurance, or registration of the name of an agent "for service of process." … Thus, the federal provision pre-empts only those state requirements that (1) concern the subject matter of the SSRS and (2) are "in excess" of the requirements that the SSRS imposes in respect to that subject matter.
Dissenting: Justice Kennedy (joined by Chief Justice Rehnquist and Justice O'Connor)
COMMUNICATIONS ACT
National Cable & Telecommunications Association et al. v. Brand X Internet Services et al.
and
Federal Communications Commission Et al. v. Brand X Internet Services et al.
Docket Nos. 04-277 and 04-281
Reversed: The Ninth Circuit
Argued: March 29, 2005
Decided: June 27, 2005
For Case Analysis: See ABA Preview 358
Did the FCC permissibly conclude that cable modem service is solely an information service under the Communications Act?
Yes. The Commission's conclusion that broadband cable modem companies are exempt from mandatory common-carrier regulation is a lawful construction of the Communications Act under Chevron and the Administrative Procedure Act.
From the opinion by Justice Thomas (joined by Chief Justice Rehnquist and Justices Stevens, O'Connor, Kennedy, and Breyer):
The questions the Commission resolved in the order under review involve a "subject matter [that] is technical, complex, and dynamic." … The Commission is in a far better position to address these questions than we are. Nothing in the Communications Act or the Administrative Procedure Act makes unlawful the Commission's use of its expert policy judgment to resolve these difficult questions.
Concurring: Justice Stevens
Concurring: Justice Breyer
Dissenting: Justice Scalia (joined by Justices Souter and Ginsburg as to Part I)
CONSUMER LAW
Koons Buick Pontiac GMC Inc. v. Nigh
Docket No. 03-377
Reversed: The Fourth Circuit
Argued: October 5, 2004
Decided: November 30, 2004
For Case Analysis: See ABA Preview 33
Did the 1995 amendment to the Truth in Lending Act remove the $1,000 cap on recoveries involving loans secured by personal property?
No. The Court ruled that the amendment did not alter the requirement that recoveries for TILA violations involving personal-property loans cannot be less than $100 or greater than $1,000.
From the opinion by Justice Ginsburg (joined by Chief Justice Rehnquist and Justices Stevens, O'Connor, Kennedy, Souter, and Breyer):
The purpose of the 1995 amendment is not in doubt: Congress meant to raise the minimum and maximum recoveries for closed-end loans secured by real property. There is scant indication that Congress simultaneously sought to remove the $1,000 cap on loans secured by personal property.
Concurring: Justice Stevens (joined by Justice Breyer)
Concurring: Justice Kennedy (joined by Chief Justice Rehnquist)
Concurring: Justice Thomas
Dissenting: Justice Scalia
COPYRIGHT LAW
Metro-Goldwyn-Mayer Studios Inc. et al. v. Grokster Ltd. et al.
Docket No. 04-480
Vacated: The Ninth Circuit
Argued: March 29, 2005
Decided: June 27, 2005
For Case Analysis: See ABA Preview 363
May the distributor of a dual-use technology be liable for the infringing activities of third parties?
Yes. One who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, going beyond mere distribution with knowledge of third-party action, is liable for the resulting acts of infringement by third parties using the device, regardless of the device's lawful uses.
From the opinion by Justice Souter (for a unanimous Court):
[T]his case is significantly different from Sony and reliance on that case to rule in favor of StreamCast and Grokster was error. Sony dealt with a claim of liability based solely on distributing a product with alternative lawful and unlawful uses, with knowledge that some users would follow the unlawful course. The case struck a balance between the interests of protection and innovation by holding that the product's capability of substantial lawful employment should bar the imputation of fault and consequent secondary liability for the unlawful acts of others. MGM's evidence in this case most obviously addresses a different basis of liability for distributing a product open to alternative uses. Here, evidence of the distributors' words and deeds going beyond distribution as such shows a purpose to cause and profit from third-party acts of copyright infringement. If liability for inducing infringement is ultimately found, it will not be on the basis of presuming or imputing fault, but from inferring a patently illegal objective from statements and actions showing what that objective was.
Concurring: Justice Ginsburg (joined by Chief Justice Rehnquist and Justice Kennedy)
Concurring: Justice Breyer (joined by Justices Stevens and O'Connor)
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