Henry Schein, Inc., II: Post-Argument Analysis

The Supreme Court heard argument in the second iteration of Henry Schein, Inc. v. Archer & White Sales, Inc., Case No. 19-963, (Henry Schein II) on December 8, 2020, which was broadcast live on CSPAN and is available here.  During the course of the argument and questioning, the Court made clear that it was only considering a narrow question:  Assume that the contract generally says that an arbitrator decides if a particular dispute must be arbitrated, rather than be litigated in a court. Also assume that the contract says claims for injunctive relief are not subject to arbitration. The parties to the contract have a dispute, and they disagree on whether the dispute seeks injunctive relief. Who decides this threshold dispute—an arbitrator or a court? (For more background on this case, see our pre-argument discussion on the issues presented.)

The question presented to the Court in Henry Schein II seems to be one of pure contract interpretation, which makes it an odd choice for the Court to hear. The Court is ostensibly deciding whether the carve-out for injunctive relief claims in this contract limits just the scope of arbitration or also limits the scope of the contract’s delegation to the arbitrator to decide the threshold issues of arbitrability. Yet, the oral argument revealed a few themes that indicate some of the broader implications of this litigation.

Continue reading “Henry Schein, Inc., II: Post-Argument Analysis”

Arbitrability Returns to the Supreme Court in Henry Schein, Inc. v. Archer & White Sales, Inc., the Sequel

Arbitrability—or who decides what claims are subject to arbitration—is returning to the Supreme Court next week for the second time in as many years.  The first time the matter reached the Court, the Supreme Court  unanimously held that, where a contract clearly and unmistakably delegates questions of arbitrability to an arbitrator, a court cannot decide the issue in the first instance, even if the court thinks the argument for arbitration is “wholly groundless.”  Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (2019).

The issue has now returned to the Supreme Court following remand and a new decision by the Fifth Circuit.  Archer & White Sales, Inc. v. Henry Schein, Inc., 935 F.3d 274 (5th Cir. 2019).  On December 8, 2020, the Court will hear the case again, this time to decide “[w]hether a provision in an arbitration agreement that exempts certain claims from arbitration negates an otherwise clear and unmistakable delegation of questions of arbitrability to an arbitrator.”

Continue reading “Arbitrability Returns to the Supreme Court in Henry Schein, Inc. v. Archer & White Sales, Inc., the Sequel”

SCOTUS Rejects Bare-Metal Defense in Products Liability Cases Under Maritime Law

On March 19, 2019, the United States Supreme Court took a middle-ground approach in deciding when, under federal maritime law, a “bare-metal” manufacturer is liable for failure to warn of dangers posed by parts used with its products, even though they are made by other manufacturers. Rejecting both a “foreseeability” standard and the “bare metal defense,” the 6-3 majority in Air & Liquid Systems Corp. v. DeVries held that “[i]n the maritime tort context, a product manufacturer has a duty to warn when (i) its product requires incorporation of a part, (ii) the manufacturer knows or has reason to know that the integrated product is likely to be dangerous for its intended uses, and (iii) the manufacturer has no reason to believe that the product’s users will realize that danger.”

Read the full Duane Morris LLP Alert.

Supreme Court Resolves Circuit Split: Single Asset Statement Reflects Debtor’s Financial Condition, Must Be Made in Writing

On June 4, 2018, the U.S. Supreme Court issued its opinion in Lamar, Archer & Cofrin, LLP v. Appling, 584 U.S. ___ (2018), resolving a circuit split on the issue of whether a debtor’s statement about a single asset constitutes “a statement respecting the debtor’s financial condition” for the purposes of 11 U.S.C. § 523(a)(2). Affirming the Eleventh Circuit’s decision, 848 F.3d 953 (11th Cir. 2017), the Supreme Court held that a debtor’s statement about a single or specific asset does fall within the scope of the statutory phrase “a statement respecting the debtor’s financial condition,” and therefore, such a statement must be made in writing in order to constitute grounds for nondischargeability.

Read the full text of this client Alert on the Duane Morris LLP website.

Supreme Court May End Web Retailing As We Know It in South Dakota v. Wayfair, Inc.

The manner in which small businesses can easily solicit orders and sell merchandise over the internet may soon end. In its place, the Supreme Court may require a more regimented and costly scheme that may force many small businesses to go out of business or limit their sales to certain states. It all depends on the outcome of a recent case in the Supreme Court called South Dakota v. Wayfair, Inc. While Wayfair itself is not a small business, a decision in this case could adversely impact many small businesses that argue, like Wayfair, that they should have some presence in the state (and thus be a user of state services) before a state can impose a tax or tax collection duty on them. On the other hand, many larger businesses, local nonweb businesses and the states believe all businesses, whether in a state or not, should collect sales/use tax to even the playing field, and if some small businesses can’t hack it or handle the administrative or financial cost, so be it. This is the background on the issues at play in Wayfair.

Read the full Alert on the Duane Morris LLP website.

 

Supreme Court to Review Sales Tax Physical Presence Standard; More States Pass Reporting Laws on Remote Sellers

The Supreme Court of the United States has accepted for review the case of South Dakota v. WayfairInc., et al, in which the state of South Dakota has challenged the continued viability of its 1992 Quill Corp. v. North Dakota decision that required some physical presence of a remote seller in a state before a state could impose its sales tax collection obligations on the seller. The Supreme Court in 1992 held it was up to Congress to change the test. In this new case, the South Dakota Supreme Court held that South Dakota’s attempt to legislatively override Quill was in violation of the law. By hearing the case, the U.S. Supreme Court will now decide whether to change the law or continue to allow the physical presence standard to stand, until and unless the Congress decides to change it. This decision could have far-reaching effects on interstate commerce, especially impacting internet sellers.

To read the full text of this Alert, please visit the Duane Morris website.

District Courts Can Extend Time to File Notices of Appeal Beyond Time Allowed in the Federal Rules

The Supreme Court issued its first opinion of the October 2017 sitting, Hamer v. Neighborhood Housing Services of Chicago, No. 16-658, 2017 WL 5160782 (Nov. 8, 2017), early last month. We previously previewed this case when the Supreme Court first granted a writ of certiorari.[1] As expected, the Supreme Court clarified an important issue regarding time limits for filing notices of appeal in civil cases. Specifically, the Supreme Court held that district courts are allowed to extend the time for filing a notice of appeal beyond the thirty-day limit prescribed in the Federal Rules of Appellate Procedure because the deadline is only set by court rule, not statute, and thus is not jurisdictional.

The Supreme Court used Hamer to resolve a circuit split over whether Federal Rule of Appellate Procedure 4(a)(5)(C) is jurisdictional or whether it is a mandatory claim-processing rule. Jurisdictional time limits “deprive[] a court of adjudicatory authority over the case, necessitating dismissal—a ‘drastic’ result.” Hamer, slip op. at 2 (citing Henderson v. Shinseki, 562 U.S. 428, 435 (2011)). These time limits are “not subject to waiver or forfeiture and may be raised at any time in the court of first instance and on direct appeal.” Id. at 2-3 (footnote omitted) (citing Kontrick v. Ryan, 540 U.S. 443, 455 (2004)). Indeed, courts are independently obligated to consider jurisdictional timeliness rules, even when not raised by either party. Id. at 3 (citing Shinseki, 562 U.S. at 434). Mandatory claim-processing rules, by contrast, can be waived or forfeited if a party fails to object to an untimely filing. Id. However, “[i]f properly invoked, mandatory claim-processing rules must be enforced.” Id. (citing Manrique v. United States, 137 S. Ct. 1266, 1271-72 (2017)). Continue reading “District Courts Can Extend Time to File Notices of Appeal Beyond Time Allowed in the Federal Rules”

U.S. Supreme Court to Hear Major Sports Betting Case

The U.S. Supreme Court announced today that it will hear an appeal from the en banc Third Circuit in the closely watched and long-running New Jersey sports betting litigation (consisting of two consolidated cases, Governor Christopher J. Christie, et al., v. NCAA et al., No. 16-476 and New Jersey Thoroughbred Horsemen’s Association, Inc. v. NCAA et al., No. 16-477).  The consolidated appeal, which will be argued next term, urges the Supreme Court to reverse the en banc Third Circuit panel that refused to allow New Jersey to expand sports betting in that state.

This appeal and the potential nationwide consequences of reversing the Third Circuit panel were the subject of an extended presentation and discussion at Duane Morris’ Future of Sports Betting panel, held on April 27, 2017.  The panel included John Brennan, staff writer for The Record; Andrew Brandt, Director of the Moorad Center for Sports Law at Villanova Law School; and Christopher Soriano, Partner at Duane Morris.

Supreme Court to Review Limitations on Appellate Extensions

The U.S. Supreme Court has granted certiorari in a case that will provide much needed clarity about the ability of district courts to extend appeal deadlines. The case, Hamer v. Neighborhood Housing Services of Chicago (No. 16-658), involves the interplay between 28 U.S.C. § 2107(c) and Federal Rule of Appellate Procedure 4(a)(5)(C). The Court will hear the case during its October 2017 term.

Section 2107(c) provides that district courts may extend the deadline to appeal “upon motion filed not later than 30 days after the expiration of the time otherwise set for bringing appeal.” Rule 4(a)(5)(C), however, provides that no extension “may exceed 30 days after the prescribed time or 14 days after the date when the order granting the motion is entered, whichever is later.”

In Hamer, the Seventh Circuit held that the district court lacked authority to grant a 60-day extension of an appeal deadline in response to a motion that was timely filed under 28 U.S.C. § 2107(c). Relying on the Supreme Court’s decision in Bowles v. Russell, 551 U.S. 205 (2007), the Seventh Circuit held that “Rule 4(a)(5)(C) is the vehicle by which § 2107(c) is employed and it limits a district court’s authority to extend the notice of appeal filing deadline to no more than an additional 30 days.” Because the notice of appeal was filed after the 30-day limitation in Rule 4(a)(5)(C), the Seventh Circuit dismissed.

In reaching that conclusion, the Seventh Circuit sided with the Second, Fourth, and Tenth Circuits, which had split with the D.C. and Ninth Circuits on the issue. The Supreme Court’s decision in Hamer should resolve the split and provide the bench and bar with much needed certainty about deadlines to appeal.

Government Abandons Prior Interpretation of 2006 Veterans Act in New Brief to the Supreme Court

In a brief filed with the Supreme Court on September 29, 2015 in the case Kingdomware Technologies, Inc. v. United States, 14-916, the government abandoned the restrictive interpretation of the 2006 Veterans Act that it pressed before the U.S. Court of Appeals for the Federal Circuit (background on the case may be found here). The 2006 Veterans Act requires that the VA prioritize competitive bidding by veteran-owned small businesses, but the VA has for years declined to follow that mandate to the full extent Congress required. In briefing before various courts, including the Supreme Court, the government had for several years (and as recently as May 1, 2015) contended that the VA was allowed to limit competitive bidding by veteran-owned small businesses for VA contracts, but the government has now – six weeks before oral argument before the Supreme Court – abandoned that position. Instead, the government now contends that VA “orders” that may be filled through the Federal Supply Schedule should be excluded from mandatory competitive bidding, while VA “contracts” should not. Continue reading “Government Abandons Prior Interpretation of 2006 Veterans Act in New Brief to the Supreme Court”