State Legislatures Magazine: October/November 2001

Editor's Note: This article appeared in the October/November 2001 issue of NCSL's magazine, State Legislatures. To order copies or to subscribe, contact the marketing department at (303) 364-7700.

Federalism and the Supreme Court

One State Two Sides
Civil Rights Rulings
What's Ahead
Land Use Setback
ERISA'S Reach

Federalism and the Supreme Court

When it comes to the Supreme Court, it's hard to tell how they'll decide issues concerning states.

By David G. Savage
In each annual term of the U.S. Supreme Court, the states win some big cases and lose a few, as well. But in recent years, some states have been winning regularly, while others have been on the losing end just as often.

Consider a tale of two states: Alabama and Massachusetts.

Alabama emerged as the winner in two of the just-completed term's major rulings. The first shielded states from being sued by their employees with disabilities (Alabama vs. Garrett), while the second bars civil rights lawsuits that allege the states are enforcing policies that have a "discriminatory effect" on racial minorities. Both were decided by the same 5-4 vote of the high court, with Chief Justice William H. Rehnquist and Justices Sandra Day O'Connor, Antonin Scalia, Anthony M. Kennedy and Clarence Thomas siding with Alabama.

Meanwhile, Massachusetts was rebuffed in its effort to ban the advertising of cigarettes within 1,000 feet of schools and playgrounds. Its lawyers had argued that the states have broad power to protect the health of their citizens, especially children, from known dangers. They also noted that selling cigarettes to minors is illegal in every state, so Massachusetts authorities said they should be able to shield children from the lure of cigarette ads.

But the Supreme Court disagreed in another 5-4 ruling, and said the states have almost no authority to restrict the advertising and promotion of cigarettes, cigars or smokeless tobacco. The cigarette makers have a free speech right to advertise their products, the Court said, a decision that could also doom efforts to limit billboard advertising of beer, liquor or gambling. And beyond that, the federal law that sets the warning labels on cigarette packs "precludes states or localities from imposing any requirement or prohibition based on smoking and health with respect to the advertising and promotion of cigarettes," wrote Justice O'Connor. The five justices who sided with Alabama in the discrimination cases ruled against Massachusetts in the cigarette advertising case (Lorillard Tobacco Co. vs. Reilly, attorney general of Massachusetts).

A year ago, Massachusetts suffered a similar rebuff after its legislature voted to boycott companies that did business with the repressive military regime in Burma (Myanmar). These companies could continue to do business in the Bay State, but state agencies were barred from buying products or services from them. These corporate boycotts were widely used during the 1980s as a successful means to pressure South Africa to end its apartheid policies. In the 1990s, cities such as New York, Los Angeles and Philadelphia adopted similar ordinances targeted at Burma. But the Supreme Court struck down the Massachusetts "Burma law" on the grounds that it infringed on the federal government's power to control international trade (Crosby vs. National Foreign Trade Council).

California, like Massachusetts, had adopted a law restricting tobacco advertising, but it too has had a losing record of late in the Supreme Court. Its voters adopted a state law that allows people who are seriously ill to obtain marijuana to ease their pain or nausea. Seven states, most of them in the West, have similar measures. But the Supreme Court sided with federal regulators and ruled the federal law allows no exceptions for the medical use of marijuana (United States vs. Oakland Cannabis Club).

ONE STATE TWO SIDES
Sometimes, state lawyers find themselves on opposite sides of the same case. Last year, the attorneys general from 38 states, including Massachusetts and California, filed a brief in the court in support of the Violence Against Women Act. This measure gives victims of rapes and other sexual assaults a right to sue their attackers for damages in federal court. Its proponents pointed out that cases of battered women or abused spouses often go unprosecuted in the criminal courts, and the states' attorneys said the federal law gave them another weapon in the fight against sexual violence. In the case that came before the high court, Virginia Tech freshman Christy Brzonkala had sued a football star for alledgedly raping her in a dormitory room.

Standing alone, Alabama's attorney general William Pryor filed a brief opposing the law. He argued that it intruded on the state's turf and violated the principles of federalism. In the end, the Supreme Court sided with Pryor's argument by the same 5-4 vote and struck down the federal law as unconstitutional (United States vs. Morrison). In a wry dissent, Justice David H. Souter commented that the "states will be forced to enjoy this new federalism whether they want it or not."

The disability discrimination case from Alabama was the major federalism decision of the 2000-2001 term, and it extends the principle that Congress cannot subject the states to damage suits by its employees, except for constitutional violations. Until the mid-1990s, constitutional law scholars had assumed Congress has broad power to regulate "commerce "and that employment was a type of commercial arrangement. Therefore, employers who violated the rights of workers as set by Congress could be sued.

But the Supreme Court in a series of rulings has changed all that for the states and state employees. In 1996, the justices held that the heretofore obscure 11th Amendment gave the states a "sovereign immunity" from private commercial lawsuits that were authorized by Congress. The decision, in Seminole Tribe vs. Florida, blocked the tribes from hauling state officials into federal court over gaming disputes, but its reach went much further. For example, state employees who are not paid overtime as required by federal labor law cannot sue to obtain the money (Alden vs. Maine).

CIVIL RIGHTS RULINGS
Going beyond commerce, Congress has special powers under the 14th Amendment to enforce civil rights, including against the states. The high court focused on that issue twice in the past two years and again shielded the states from federal claims. The first case, decided on Jan. 11, 2000, ruled that age discrimination was not outlawed by the 14th Amendment itself, and therefore, Congress could not subject state agencies to lawsuits for discriminating against their older workers. The 5-4 decision, in Kimel vs. Florida, threw out a bias claim filed by J. Daniel Kimel, a Florida State University physics professor, but the immunity rule affected the nearly 5 million state workers nationwide.

This year's case from Alabama extended the rule to state employees who are blind, deaf or otherwise disabled. The Constitution may forbid the states from discriminating against people based on their race or sex, but it does not forbid discrimination based on a person's disability, said Chief Justice Rehnquist. "States are not required to make special accommodations for the disabled ... They could quite hardheadedly-and perhaps hardheartedly-hold to job qualification requirements that do not make allowance for the disabled," he said.

Because this kind of discrimination is not covered by the 14th Amendment, Congress cannot use its power to enforce the 14th Amendment as grounds for subjecting states to lawsuits under the Americans with Disabilities Act, Rehnquist reasoned. Patricia Garrett, a nursing supervisor at the University of Alabama Hospital, had sued for discrimination because she was demoted after being treated for breast cancer.

The second decision from Alabama limited the reach of the Civil Rights Act of 1964, and it too could have a wide impact. From the beginning, Justice Department lawyers had maintained the landmark law prohibited not only intentional discrimination by states, cities, schools or colleges, but also the use of policies that "have the effect of subjecting individuals to discrimination" because of their race, sex or national origin.

These so-called "disparate impact" claims have been many and controversial. The University of California at Berkeley was sued on this theory because the use of SAT scores was said to have a discriminatory effect on blacks and Hispanics. Advocates of "environmental justice" have also brought claims against state agencies alleging that they permitted the siting of waste treatment plants in low-income black neighborhoods. In the case that reached the high court, the Southern Poverty Law Center had sued Alabama on behalf of Martha Sandoval, a Spanish speaking resident, after the state became the first to offer its drivers' exam in English only. She won in two lower federal courts, but the Supreme Court ruled the law never intended to allow such lawsuits in the first place.

"We hold that no such private right of action exists," Justice Scalia said, thereby sweeping aside all the lawsuits that challenge the "discriminatory effect" of state policies.

WHAT'S AHEAD
It is not clear where the Supreme Court will go next in the area of federalism. The justices have turned away claims from states seeking a shield from the Equal Pay Act or other sex discrimination charges. Unlike bias based on a person's age or disability, the 14th Amendment does forbid sex discrimination, the Court has said. Therefore, by this logic, Congress can subject states to damage suits for sex discrimination.

The justices have also not reconsidered Congress's nearly unlimited power to use federal funds as a means to force its will on the states. Some advocates of federalism have predicted this will be the next frontier in the court's campaign to rein in Washington's power over the states. But Justices Kennedy and O'Connor have said they are unwilling to make radical changes in the federal-state balance. And without their votes, Chief Justice Rehnquist lacks a majority to push ahead further.

In May, however, Rehnquist succeeded in mustering a 5-4 majority to shield states from having to pay some lawyers' fees. Congress has authorized judges to force states to pay the fees of lawyers who are the "prevailing party" in civil rights cases. This phrase has been interpreted broadly to include instances where a lawsuit was the "catalyst" for a state agency to change its policies. But Rehnquist rejected the catalyst theory and held lawyers are entitled to win fees in civil rights cases only if they win a final court order (Buchannon Board & Care Home vs. West Virginia). West Virginia had been sued by several elderly residents of group homes over a rule that required residents to be able to reach the fire escape on their own, but the Legislature repealed the rule after it became the subject of litigation.

LAND USE SETBACK
The states did not fare as well in the area of land use law. The justices revived a Rhode Island's landowner's claim against the state for having blocked him from building homes in a tidal area near the ocean. When Anthony Palazzolo bought his 20-acre parcel, most of it had already been designated as wetlands by Rhode Island's coastal management council. Nonetheless, when his development plans were rejected, Palazzolo sued for $3 million in compensation. His claim was filed under the 5th Amendment's guarantee that private property shall not "taken for public use without just compensation."

Until this year, most courts had said that buyers who purchased land that was subject to development restrictions cannot sue for compensation if their development plans are rejected later. But the Supreme Court overturned that shield for the government and said owners such as Palazzolo can seek compensation on the grounds that the development ban was extreme and unreasonable (Palazzolo vs. Rhode Island). Experts in land use law said the decision opens the courthouse door to more compensation claims, but they also doubted that many property owners would win in the end.

In the fall, the justices will take up a new property rights case that could have a broad impact. At issue is whether land use agencies can be forced to pay compensation for having imposed a temporary moratorium on development. If the answer is "yes," state and local planning agencies would have the threat of huge money claims hanging over them whenever they blocked a development, even temporarily. The case before the court began as a suit by landowners near Lake Tahoe, who were blocked from building vacation homes (Tahoe Sierra Preservation Council vs. Tahoe Regional Planning Agency).

The term's rulings on the 4th Amendment were decidedly mixed from the view of both law enforcement and civil libertarians. The justices rejected two novel means of searching for illegal drugs. First, they struck down the use of narcotics checkpoints, saying too many innocent motorists would be stopped and searched (City of Indianapolis vs. Edmonds). And they rejected the use of thermal imagers that can scan homes from the street and spot those that might contain a hothouse for growing marijuana (Kyllo vs. United States). Justice Scalia said the 4th Amendment was intended to protect the privacy of homes from the prying eyes of law enforcement, including, he said, high-tech devices that can look inside a home.

But in a third case, the Supreme Court refused to limit police from arresting people for minor offenses committed in their presence. Lawyers for a Texas mother, who was arrested and taken to jail for not wearing a seat belt, had urged the high court to rule such arrests were "unreasonable seizures" (Atwater vs. City of Lago Vista).

Lawyers for the Colorado Republican Party also failed in their effort to knock down the federal limits on how much the parties can spend to promote their candidates. These limits go back to the post-Watergate era of the 1970s, but they were seen as vulnerable to a free speech challenge.

Five years ago, the high court struck down the limit on "independent expenditures" on a 7-2 vote, saying parties should be free to espouse their message. But in June, the Court reversed course a bit and upheld the limits on party spending that is "coordinated" with the candidate (FEC vs. Colorado Republicans). Speaking for the 5-4 majority, Justice Souter said these expenditures could be seen as disguised contributions to a candidate. Under current law, individuals can give $1,000 per election to a candidate for federal office, and $20,000 to a party. If the parties could spend unlimited amounts for their candidates, the parties could be "used as a funnel" for money flowing from rich donors to candidates, he said.

ERISA'S REACH
Meanwhile, the federal pension law, not state divorce law, was held to govern the proceeds of a divorced employee who dies without a will. David Egelhoff, who was employed by the Boeing Company, had listed his second wife Donna as the beneficiary of his life insurance and pension. But they were divorced in 1994, and he was killed shortly afterward in an automobile accident. Under Washington law, his children from his first marriage were entitled to the money, but the Court ruled that the federal Employee Retirement Income Security Act (ERISA) preempts the state law (Egelhoff vs. Egelhoff).

The reach of ERISA remains a source of legal dispute. In the fall, the Court will consider its reach again in a case involving HMOs. At least 38 states have set up independent review boards that are empowered to force HMOs to pay for treatments that are deemed medically necessary. But a U.S. appeals court in Texas ruled these state requirements are preempted by ERISA's exclusive control over the area of employee benefits. Other courts have come to the opposite conclusion and upheld the state boards. The justices will decide the issue in an Illinois case known as Rush Prudential HMO vs. Moran.

The fall session of the Court features two other issues sure to attract public attention. In a North Carolina case, the justices will decide whether executing a mentally retarded defendant is cruel and unusual punishment (McCarver vs. North Carolina). And the justices will get another chance to rule on whether states can use tax money to provide vouchers to pay for children in parochial schools. Ohio created such a program for children in Cleveland, but a U.S. appeals court struck it down as unconstitutional. In its appeal in Zelman vs. Simmons-Harris, the state's lawyers are urging the justices to finally resolve the matter.

David G. Savage, a frequent contributor to State Legislatures magazine, covers the Supreme Court for the Los Angeles Times.

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