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A Busy Two Weeks for Court as Adjournment Draws Nigh

16 April 2014
National Law Journal

Lying, streaming and phoning top the April argument docket of the US. Supreme Court as the justices enter the homestretch of the October 2013 term.

The court has just more than two months until its traditional wrap-up by the end of June. And although the most controversial cases of the term have already been argued, the final two weeks of arguments this month present a number of significant issues to keep interest in the court's work running high.

With midterm elections on the horizon, the justices on April 22 will consider another campaign challenge, but not one involving money. They will hear a First Amendment challenge to an Ohio law prohibiting false statements about candidates for office.

Later that same day, a showdown between the major broadcast networks and an upstart competitor that streams the networks' programming to its customers' Internet-connected devices for a fee unfolds in one of the most important copyright cases in recent years.

And during the second week, the Fourth Amendment will move into the spotlight as the justices wrestle with whether law enforcement officers must secure warrants to search the cellphones of lawfully arrested persons.

The court continues its fascination with patent law in two challenges involving rulings by the U.S. Court of Appeals for the Federal Circuit. Another First Amendment case involves public employee speech. And POM Wonderful LLC and The Coca-Cola Co. face off in a battle over a false advertising claim under the Lanham Act.

The justices have issued 34 decisions thus far, including five per curiam (unsigned) opinions. However, most of the term's highest profile cases involving affirmative action, abortion, religion and separation of powers, although argued, are still pending decision.

"I think there's going to be a lot of back-loaded excitement here in May and June," veteran high court advocate Andrew Pincus of Mayer Brown predicted.

What follows is a closer look at some of April's top arguments.

BILLIONS AND BLUEBERRIES

The international banking community on April 21 will closely watch Argentina v. NML Capital, a case stemming from that nation's 2002 default on $100 billion in sovereign debt. The hedge fund NML Capital has judgments against Argentina totaling about $1.6 billion. Argentina is asking the Supreme Court to reverse lower court decisions upholding two subpoenas relating to bank accounts maintained by Argentina here and abroad, as well as transaction histories and records of electronic funds transfers involving Argentina as a party. Argentina contends the court-ordered discovery violates its sovereign immunity.

In POM Wonderful v. Coca-Cola, the justices also on April 21 will consider whether a private party may bring a Lanham Act false-advertising claim challenging a product label regulated by the federal Food, Drug & Cosmetic Act. POM Wonderful brought the claim against Coca-Cola's Pomegranate Blueberry fruit juice blend, which contains 0.3 percent pomegranate juice and 0.2 percent blueberry juice. The lower courts ruled for Coca-Cola, saying the Lanham Act claim was barred because it would conflict with Food & Drug Administration regulations.

"I think this really is a very important case," said Douglas Rettew of Finnegan, Henderson, Farabow, Garrett & Dunner. "If Coca-Cola can be insulated from all false advertising claims just by virtue of the fact they comply with FDA regulations, that will really have a profound impact for competitors and for consumers who would be deceived by something technically complying with FDA regulations."

And it's not just FDA regulations, the false-advertising litigator added: other agencies regulate advertising, among them the Federal Communications Commission and the FDIC. The case, Rettew said, has "enormous implications."

LIES AND BROADCASTS

Moving from billions and blueberries to lies and broadcasts, the court on April 22 will hear Susan B. Anthony List v. Driehaus. At least 15 states have laws similar to Ohio's ban on knowingly or recklessly making false statements about candidates for office. In the Ohio case, the anti-abortion Susan B. Anthony List wanted to erect billboards during the 2010 elections criticizing incumbent Rep. Steven Driehaus for his vote in support of the Affordable Care Act. The message: "Shame on Steve Driehaus! Driehaus voted FOR taxpayer-funded abortion."

Driehaus filed a complaint under the Ohio law with the Ohio Elections Commission, which found probable cause for the complaint. The SBA List then filed suit in federal court to block enforcement of the state law. The complaint was withdrawn by mutual consent but the suit went forward. The U.S. Court of Appeals for the Sixth Circuit ultimately held that the lawsuit was not ripe because there was no imminent threat of prosecution.

Whether the justices actually get to the merits of the law's constitutionality depends on whether they find any of the SBA List's claims—First Amendment, due process—ripe for resolution.

American Broadcasting Cos. v. Aereo is being touted as one of the most important copyright cases in recent years. Under the Copyright Act, a copyright holder has the exclusive right "to perform the copyrighted works publicly." The high court is asked whether Aereo violates the broadcast networks' copyrights by enabling paying subscribers to receive copyrighted broadcast television programs over the Internet by using thousands of miniature antennas to capture, create and stream an individual digital copy of those programs to each subscriber who seeks to watch them. Two high court veterans will make the arguments: Paul Clement of Bancroft for ABC, and, for Aereo, David Frederick of Kellogg, Huber, Hansen, Todd, Evans & Figel.

"It is settled law that third parties must pay for the rights to transmit performances of copyrighted works to the public," Clement wrote. "Yet Aereo has built an entire business around exploiting that copyrighted content—and has done so without obtaining permission from copyright owners or paying anyone a penny. And if Aereo prevails, nothing will stop other services that currently pay for the rights to retransmit broadcast television from devising their own Aereo-like workarounds to achieve the same result.”

Frederick counters it is undisputed that the content at issue is delivered for free over the public airwaves with the networks' authorization and that any consumer with an antenna is entitled to receive, watch and make a personal recording of that content. "This case simply concerns the next technological step: allowing a consumer to access broadcast programming using an Internet-connected device coupled with a remotely located, individually assigned antenna and segregated video storage," he argued.

PHONES AND PRIVACY

Two cellphones are at the center of the latest and last Fourth Amendment challenge of the term.

Riley v. California and United States v. Wurie ask the justices whether police must have warrants to search the contents of cellphones following an arrest. Riley involves a smartphone capable of accessing the Internet and holding a considerable amount of information. Wurie involves the older style flip phone.

The criminal defendants in both cases have drawn wide support from libertarian, media, criminal defense, technology and other groups.

"We framed our brief to say this is really about how 'search incident to arrest' applies to stored information—iPads, laptops, tablets, even thumb drives, frankly," said Mayer Brown's Pincus, who filed an amicus brief on behalf of the Center for Democracy & Technology. "Digital cameras is another area; you can probably store thousands of pictures. I don’t see how you can draw a distinction between those devices. To me, it's about all electronically stored information."

Reprinted with permission from the April 16 edition of The National Law Journal © 2014 ALM Properties, Inc. All rights reserved. Further duplication without permission is prohibited.

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