The Supreme Court will hear four cases this week, condensed into two days due to the holiday on Monday. The first two cases of the week, which will be heard on January 16 are Macquarie Infrastructure Corp. v. Moab Partners, L.P. and Devillier v. Texas. In Macquarie, the Court will decide whether certain sections of the Securities Exchange Act of 1934 and Securities and Exchange Commission regulations provide a private cause of action for failure to disclose information. Macquarie Infrastructure Corp. withheld crucial information from shareholders on a repeated basis. For one, the company failed to disclose that a large portion of its profits were dependent upon the success of International-Matex Tank Terminals (IMTT). Further, they hid information from shareholders about the company’s reliance on a particular type of fuel oil which was soon to be regulated more strictly, and then misled investors as to IMTT’s ability to adapt to this situation. Macquarie’s stock price collapsed when it became clear these statements were not true, as profits tumbled. Moab sued Macquarie on behalf of shareholders. The district court dismissed the case for having failed to make a substantive claim, but the Second Circuit reversed the decision on the grounds that actionable material omissions were presented.
In Devillier, the court will decide whether parties may sue states under the Takings Clause of the Fifth Amendment. Devillier was a property owner alongside Interstate 10 in Texas. As a consequence of the state erecting a median barrier on the highway, water flow was diverted and caused property damage to Devillier and other property owners along the highway. The district court denied a motion to dismiss from the state, but the Fifth Circuit vacated the ruling, finding that there is no private cause of action under the Takings Clause as applied by the Fourteenth Amendment.
The cases on January 17, Loper Bright Enterprises v. Raimondo and Relentless, Inc. v. Department of Commerce are both highly anticipated cases that may finally reverse Chevron Doctrine. Landmark has long opposed the Doctrine, which obligates courts defer to agency interpretations of their authority when statutory language is ambiguous. The Chevron Doctrine has provided a legal basis for the enormous growth of the administrative state. In both Loper and Relentless, Inc., fishermen were forced assume prohibitive costs as a result of regulations promulgated by the National Marine Fisheries Service and the Department of Commerce, respectively. Both agencies relied on the Magnuson-Stevens Fishery Conservation and Management Act of 1976 for statutory authority for these actions, though no actual language in the Act vests these agencies with this type of rule-making authority.
Landmark filed a brief in Loper, arguing for Chevron to be overturned. The Supreme Court has, in recent terms, advanced ever closer towards this end, repeatedly boxing in Chevron with rulings such as West Virginia v. Environmental Protection Agency, which established the Major Questions Doctrine. The Court has a chance in Loper and Relentless, Inc. to reverse Chevron and ensure administrative agencies no longer stray from their enabling statutes.
Landmark will continue to follow these important cases and provide updates as circumstances arise.
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