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Kennedy’s Mixed Business Legacy

5 July 2018
Supreme Court Brief

Justice Anthony Kennedy’s record on gay rights, abortion, affirmative action and the like has dominated retrospectives of the retiring jurist. But what about his views on business matters, and what will his absence portend?

We asked Mayer Brown partner Lauren Goldman, co-head of the firm's Supreme Court and appellate group to give a quick assessment.

Since 2010, she and her colleagues have tallied the wins and losses in business cases decided by the Supreme Court and shared them with The National Law Journal.

Her chart from the term just ended shows that business interests prevailed in 11 of 14 cases. (If the number of cases seems low, that’s because disputes in which businesses are on both sides of the v. are excluded—which knocks out patent, bankruptcy and certain other kinds of cases.) Six of the cases were decided by 5-4 votes, an unusually high number.

With decisions like Epic Systems Corp. v. Lewis on arbitration and Ohio v. American Express on antitrust, Goldman said “It was a very important year for business cases.”

Kennedy was in the majority in all 14 cases—including the losses, the biggest of which was South Dakota v. Wayfair. Kennedy wrote the 5-4 majority opinion in favor of South Dakota’s law imposing sales taxes on online retailers who had no physical presence in the state. Of course some brick and mortar businesses were on the state’s winning side, happy that they will soon be on an even sales tax playing field.

That track record for Kennedy this term mirrored his usual pro-business stance throughout his career. On issues like punitive damages (See his State Farm v. Campbell decision in 2003) he was consistently on the side of business, while on some issues like employment discrimination, he held more middle ground.

More observations from Goldman:

  • On arbitration, she said, “Kennedy was consistently very supportive of the Federal Arbitration Act,” even in recent years when arbitration cases have become more contentious and high-profile.
  • Federal preemption of state laws is high on the wish list for business advocates, but Goldman said Kennedy was not as favorable toward preemption as some other justices. “He could be more deferential toward states.” In 2009 Kennedy joined the majority in Wyeth v. Levine, rejecting federal preemption of state-law claims on drug labeling. A follow-on pre-emption case is on the court’s docket for next term.
  • On patents, Kennedy had a nuanced point of view, rejecting rigid rules and embracing the view that “We need to consider that patent rights can inhibit innovation,” Goldman said.
  • Kennedy was “more supportive than many conservatives toward environmental regulation,” Goldman said. Case in point: he was the fifth vote in Massachusetts v. EPA in 2007, approving EPA authority to regulate greenhouse gases.
  • On Chevron deference, a big target for business, Kennedy had become “increasingly skeptical” of deferring to the interpretation of regulatory agencies, “a view shared by other conservative justices.”

VIEW THE FULL CHART: This year’s Mayer Brown chart on the Supreme Court’s business docket can be seen in its entirety here.

Reprinted with permission from the July 4, 2018 edition of Supreme Court Brief © 2018 ALM Properties, Inc. All rights reserved. Further duplication without permission is prohibited.

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