Upcoming Cases at the Supreme Court

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2:49several tests of President Trump's attempts to expand executive power. My guest is former United States Solicitor General Gregory Garr, a partner at Latham and Watkins. Greg, let's start with one of the biggest cases of the term where trillions of dollars in trade are at stake, as well as the extent of the president's authority. If you took away tariffs, we could end up being a third world country. President Trump has put tariffs at the center of U.S. economic policy. Lower courts ruled that he overstepped his authority, but now it will be up to the Supreme Court to decide. It's a very important decision, and frankly, if they make the wrong decision, it would be a devastation for our country.

3:36We've taken in trillions of dollars. Greg, what are the issues here? So this case involves a challenge brought by small businesses to President Trump's tariff policy, imposing tariffs on products from companies around the world. Importantly, in this case, the president doesn't assert inherent executive power to impose the tariffs. Instead, he claims that Congress granted him the power under a 50-year-old statute called the International Emergency Economic Powers Act, or IEPA. And Section 1702 of IEPA has a long list of things that the president can do if he declares an emergency, as President Trump did here on the basis of foreign trade deficits and the fentanyl crisis as to certain countries.

4:23So when the president declares such an emergency, Congress authorized him to do a number of things, including to quote-unquote regulate the importation of goods. So this statute doesn't mentioned tariffs expressly. Before this year, no president in IABA's 50-year history had ever invoked it to impose tariffs. And Congress has always explicitly imposed limitations on the exercise of tariffs when it's granted that power explicitly. But the president claims that the broad reference to regulate in this statute does authorize him to impose the tariffs on goods around the country. So far, he's lost that argument in each of the lower courts that has considered it, but the case is moving to the Supreme Court.

5:09And one of the signature projects of the Roberts Court has been the development of the so-called major questions doctrine, which is built on the age-old principle that Congress does not hide elephants in mouse holes. So a couple of years ago, the Supreme Court in Biden v. Nebraska held that the Department of Education lacked authority to institute sweeping student loan forgiveness on the basis of a general emergency language in the HEROES Act. And before then, it held in a different case that the EPA couldn't rely on a general provision of the Clean Air Act to enforce sweeping climate change regulation.

5:48And the challengers in this case essentially argued that the same principle compels the conclusion that IEPA's general reference to regulate can't be interpreted to authorize the president to impose what would amount to one of the biggest tax increases in U.S. history, sort of the elephant of all elephants. Now, in response, the administration claims that the court has never applied the major questions doctrine to the foreign affairs context, and that in that context, the court should presume that Congress would give the president more leeway, which is actually something that Justice Kavanaugh suggested in a concurring opinion last year.

6:26Nevertheless, it seems hard to square the administration's position in this case with the application of the major question doctrine in other cases, particularly given that few presidential acts have had such a momentous economic sweep as the president's tariff program has. So this is a very big power he's asserting, and we're all waiting to see how the court reacts to this particular assertion. So as you mentioned, the two lower courts ruled that Trump had overstepped his authority in imposing most of these tariffs. Do you think the Supreme Court took this case to overturn the lower courts or they would have taken the case anyway because it's such an important issue?

7:08Yeah, I think this is one that the Supreme Court was going to take probably either way. But certainly, given that the lower courts invalidated the president's policy and the administration was acting for review, I think it was pretty much automatic that the court was going to agree to hear the case. Do you think that this case of the cases the court is going to consider this term, is this the greatest test of Trump's attempt to expand presidential authority? Well, this case is different in that, again, it really just concerns the scope of the authority that Congress granted. In other cases that I think we'll talk about, the question is the president's assertion of his own inherent constitutional authority.

7:50But this case really just boils down to a question of what Congress delegated. So, I mean, even if the administration did win this case, it would still leave to Congress the prerogative to change the law. On the other hand, the court might hold, again, following its major questions cases, that Congress simply didn't delegate this elephant to begin with. Okay, so going on to a couple of other cases that set up tests of presidential power over federal agencies that have been independent. They involve Trump firing a member of the Federal Trade Commission, Rebecca Slaughter, and a Federal Reserve Board Governor, Lisa Cook.

8:27Slightly different issues. So let's start with the FTC commissioner. And is it about the law there that says commissioners can only be removed for cause? Right. And this is one of the cases where the president is asserting his own inherent authority. And Congress has imposed a limitation on the president's removal authority with respect to heads of the Federal Trade Commission and requires the president to show cause, things like malfeasance or neglect of duty or the like, before he can actually remove the official. And in this case, the president removed the official Rebecca Slaughter, commissioner of the FTC, simply because he disagreed with her as a matter of policy.

9:10So this case tees up a challenge to a 1935 decision called Humphrey's Executor, where the court upheld Congress's imposition of a for-cause requirement on the president's removal of commissioners of the FTC. So it's basically just a redo and a chance for the Supreme Court to reconsider its Humphreys executor precedent. The administration here is arguing, first of all, that the FTC has changed a lot since the day of Humphreys executor. In essence, this is not your grandfather's FTC. It's got a lot more executive authority. And so whatever sort of constitutional basis the court had for its decision in Humphreys executor, that shouldn't apply to the FTC today.

9:51The administration also argues that if the court doesn't accept that, it should just go ahead and overrule the Humphreys' executor decision, which is something a number of the more conservative justices have expressed a willingness to do in recent years. And the administration is also arguing that even if the president did do something wrong here, a court couldn't actually order the reinstatement of the official mislaughter here. The only remedy would be one for back pay, which is actually the remedy that was sought in the Humphreys executor case. So this is a major test of executive power. And really, although the case arises in the context of firing an individual, ultimately, it's about the president seeking to gain control of so-called independent agencies by being able to place his own preferred heads of those agencies in place.

10:43So the court has been chipping away at Humphrey's executor for a while. And Justice Elena Kagan said in one of her recent decisions that, you know, they're raring to get rid of Humphrey's executor. Do you think Humphrey's executor can survive this term? You know, it sure seems like they are raring to get rid of it. And, you know, I probably would put my money on the side of it not surviving. That said, I mean, it would be fairly easy for the court to say that the FTC today is much different than the FTC in Humphrey's executor time. And so to further narrow Humphrey's executor. But I do think it's the case that the justices probably have just had enough.

11:21So I think Humphrey's executor's days may be numbered. The court refused to let Slaughter return to her job as the litigation goes forward. And that sets it apart from the next case we'll talk about involving Trump's attempts to fire Federal Reserve Board Governor Lisa Cook. And this week, the court said that Trump can't fire Cook as the litigation is proceeding. Is that difference significant? Yeah, I think it is. I mean, it's the one time among all the other officials that the president has fired that the Supreme Court has declined to grant the administration's request to permit it to actually remove the official once and for all.

12:04And instead, what the Supreme Court did here was set the case for argument on the administration's emergency request in January. Cook's case is different. Cook is a member of the Board of Governors of the Federal Reserve. And here the president isn't claiming that he had the right to fire Cook for any reason. He claims that he had cause based on allegations that she had engaged in mortgage fraud before she became a member of the Fed. So that's one way in which the case is different than the Slaughter case. And then also that the Supreme Court has indicated in prior opinions that the Fed may be different and that it's what the Supreme Court called a uniquely structured and quasi private entity with a unique history.

12:47So even if the court is poised to overrule Humphrey's executor in the case of an FTC official, it's not at all clear that the court is poised to reach anything like that result in the context of the Fed, which I think many believe is uniquely important in terms of its insulation from immediate presidential control. If the court says Trump can't fire Cook, would it have any trouble coming to that decision in a reasoned way, you know, distinguishing the Fed from other independent agencies? I don't think so. And, you know, in fact, as I mentioned, I mean, the court has already acknowledged a distinction.

13:26Now the question in Cook's case will be how far it wants to run with that. But certainly the Fed is different. It has roots in the old first national bank of the United States and it's uniquely structured. And I think, you know, many, including Justice Kavanaugh and writings off the court have sort of acknowledged that there may be particular concerns as to why that would be an agency that could operate with some independence within our constitutional system. So we'll have to see. Next, there's a case that could have an enormous effect on elections in dozens of congressional districts with predominantly minority populations.

14:03And it involves a Louisiana electoral map that raised the number of black majority U.S. congressional districts in that state. It's already been at the Supreme Court once. Yeah, so the case was argued and briefed last term, and the court couldn't reach a decision, so they set it for re-argument and consideration this term. And this case really has sort of had a long and torturous history already. So after the 2020 census, Louisiana legislature, like many states, went back and redrew its congressional maps. And the new map it drew had one majority black district out of six districts statewide. At that point, a group of black voters brought suit against the state, arguing that the plan impermissibly diluted the votes of black residents in violation of Section 2 of the Voting Rights Act, because nearly a third of the state's population is black.

14:54So the lower courts ultimately ordered the state to draw a new map, and the new map contained a second black majority district. But this time, a group of non-black residents went to federal court and argued that the 2024 map impermissibly took race into account in the other direction. And so it was itself invalid. So the state basically went to the Supreme Court, said it was between a rock and a hard place, and asked the court to resolve it. And as you noted, the court wasn't able to do so last term. So it set up for re-argument again and basically upped the ante by asking the parties to brief the question of whether the state's intentional creation of a second majority minority district to comply with the Voting Rights Act actually violated the Equal Protection Clause.

15:39So now the court is faced with the question that is sort of long beleaguered the court in voting rights cases, which is how do you square the fact that you have to take race into account to comply with the protections of the Voting Rights Act with the fact that the Constitution and protection clause generally prohibits states from taking race into account and making important decisions. So this case could definitely have a major effect on Section 2 litigation going forward. The government, for its part, argues that Section 2's results test is unconstitutional if it requires the states to draw majority-minority districts where race predominates And that basically what a plaintiff has to show to prevail under its view of the Voting Rights Act is it must show that the new district is superior under race neutral districting principles.

16:24So the Voting Rights Act is one area where we've seen some consequential decisions in the past few years. And this is a case that definitely should be followed closely. The court gutted part of the Voting Rights Act in a Shelby County versus Holder case in 2013. and some justices have questioned the constitutionality of race-based districts. A quote that challenges used here was one from Justice Brett Kavanaugh, the authority to conduct race-based cannot extend indefinitely into the future. Does it seem as if the court is heading in that direction to get rid of the consideration of race in map drawing?

17:04Well, the hesitation and reluctance and hostility to consideration of race in a number of areas, including affirmative action and the like, has definitely been one of the sort of emphases of this court. Interestingly, the court just a couple of years ago in a case out of Alabama, by a 5-4 vote with the chief justice and majority joined by the more liberal justices and Justice Kavanaugh, upheld a map that was challenged out of Alabama. So it would be, you know, something of a right turn for the court to go ahead and invalidate section two of the Voting Rights Act on constitutional grounds more broadly.

17:41And we don't know. I think based on the fact that the court was unable to reach a decision last term in this case, it suggests that the justices are struggling. The fact that they've added this broader constitutional question doesn't mean that the justices have to resolve it on that basis. I think if there's anything we can sort of speculate at this point is that the justices are closely divided on this issue. Coming up next on the Bloomberg Law Show. I'll continue this conversation with Gregory Garr, former U.S. Solicitor General. We'll discuss upcoming cases on transgender rights, religious rights, copyright, and capital punishment.

18:18I'm June Grosso, and you're listening to Bloomberg. This message is brought to you by Apple Card. Apple Card lets you earn daily cash back on every purchase, every day. Applying the Wallet app on iPhone today. Subject to credit approval, Apple Card is issued by Goldman Sachs Bank USA Salt Lake City Branch. Terms and more at AppleCard.com. Support for the show comes from Public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. Buying the dip, manually sweeping idle cash, putting on a hedge. On Public, you can now create AI agents that handle all these tasks on your behalf.

18:53Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. or if my cash balance goes above$20 ,000, move the excess into my direct index. You approve of the workflow and your agent handles the rest. Monitoring the market, watching for your conditions and executing your strategies exactly as defined. An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market.

19:32Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., Member FINRA, and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures. Let's talk about health care for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a health care company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers.

20:14Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together. technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. Lindsay Hecox is a college senior and transgender woman who participates in club-level running and soccer at Boise State University.

20:56Hecox says that she should have the opportunity to play sports like everyone else. I don't even think most of my teammates would even think of me as trans. I just look like a regular girl. But in 2020, Idaho passed the first law of its kind barring transgender women and girls from participating on all-female teams starting in grade school. The Ninth Circuit Court of Appeals ruled that the law couldn't be enforced against Hecox. But now her case, along with that of a 15-year-old transgender girl from West Virginia, is before the Supreme Court. I've been talking to former United States Solicitor General Gregory Garr, a partner at Latham and Watkins.

21:42So, Greg, the Supreme Court is going to decide whether states can ban transgender girls and women from competing for their schools on female athletic teams. The appeals are from the Fourth Circuit and the Ninth Circuit, which blocked the states of West Virginia and Idaho from fully enforcing their bans. but the Fourth Circuit's decision was based on Title IX, and the Ninth Circuit's decision was based on the Equal Protection Clause. So it wouldn't be a Supreme Court term without a return to the culture wars, and this case definitely presents that. And the cases from both circuits do present the different questions of the Equal Protection Clause in Title IX and challenges to the validity of state laws that prohibit transgender girls and women from competing in girls' and women's sports.

22:31These are laws that I think about half of the states have. And the main legal question in the case is whether it's sex discrimination when a state mandates that only biological females can compete in female sports. Both cases involve transgender girls who want to compete on female cross-country teams. So last year, as you remember, in U.S. v. Skrmeni, the court held that a Tennessee law banning puberty blockers and hormone therapy for transgender minors did not engage in sex-based discrimination, violating the Equal Protection Clause. And it seems likely that the court will reach a similar conclusion here.

23:12In fact, picking up on Justice Ginsburg's own writings, the government argues that the laws here simply take into account the physical differences between men and women and that therefore they don't really engage in impermissible discrimination to begin with. Now that plaintiffs sort of counter with the Supreme Court's decision in Bostock versus Clayton County, where the court held that discrimination based on gender or sexual identity is discrimination on the basis of sex under Title VII. But the Supreme Court distinguished and I think limited Bostock in the Scrimetti case last year. And I think that challengers probably have a hard argument in pushing Bostock to the Supreme Court in this case.

23:53The supporters of these laws also argue that allowing biological males to compete in women's sports would defeat the whole purpose of Title IX. So, you know, this is, again, one of these cases that really sort of hits hard on the culture wars, and the court, I think, will be following up on its decision last year in Scrimetti, and we'll see what it does. 27 states have laws or regulations that restrict transgender student athletes. So, So if the court upholds the state bans in these cases, would all those laws then be valid? Or does it depend on what they say, the exact wording? Well, it depends on what they say.

24:34But I think, you know, as a general matter, this is an up or down question. I mean, I think if the court holds that the laws in the two cases here are constitutional and don't violate Title IX, then I think that the other laws will almost certainly pass muster as well. And it also wouldn't be a Supreme Court term without a religious rights case. A Rastafarian wants to sue prison officials in Louisiana who forcibly shaved him bald in violation of his religious beliefs. The court has considered a lot of cases involving the rights of Christians, but I don't know of any until now involving the rights of Rastafarians.

25:13Yeah, and the court's been very active in the area of religion recently, and generally is sided with proponents of religious liberty. The facts of this case are really pretty extreme and outrageous. In this case, it's brought by a Rastafarian inmate who is suing a state prison official under what's called the Religious Land Use and Institutional Persons Act, or ARLUPA. And he claims that when he was transferred to a new prison, the prison official allegedly handcuffed him to a chair and actually shaved his head, even though he told the guard that he had taken a religious vow not to cut off his hair, which he had honored for over a decade, and actually handed the guard a copy of a Fifth Circuit decision holding that cutting the hair of a Rastafarian inmate would violate the inmate's religious liberties.

25:59So the inmate brought suit seeking monetary damages against the prison officials involved in this process. So under a different law, the Religious Freedom Restoration Act, the Supreme Court has held that inmates can get money damages against federal officers who violate their religious liberties. And so the basic question is whether the same rule would apply to state officers under Arlupa, the parallel statute. And it would seem like the answer would have to be yes, but the state argues that because Arlupa was passed under Congress's spending clause power, where Congress generally attaches strings to federal funding grants, the state argues that a different rule applies because the state has never agreed to these sorts of terms to be subjected to money damages suits.

26:44And then the state also argues that if the court accepts the inmate's position, it's going to only exacerbate the shortage of people who are willing to serve as prison guards. I'm not sure that that's going to be enough here. I mean, I think that the facts of this case in particular may weigh on the court. And the Trump administration here is actually supporting the inmate in this case so that the state may have an uphill battle on its hands, but we'll see. And it was the Fifth Circuit that threw out his lawsuit, even though it was a Fifth Circuit decision that he was banding about? Yeah. Well, and really, at this point, it's a separate question of not whether the law was violated, but whether he could get monetary damages.

27:24And in fairness to the state, most of the lower courts had held to this point that you cannot get monetary damages against the prison official under Urlupa. So it's definitely interesting that the court agreed to take the case nonetheless. So the court is going to hear another death penalty case. It heard a couple last term. This time it's about what defendants have to show in order to prove that they're mentally disabled and thus ineligible for the death penalty. Yeah, and the death penalty has actually been a pretty interesting area for this court. Last term it had three death penalty cases and the death row inmate won in all three of those cases.