December 6, 2019

Supreme Court Decisions: Why You Should Be Listening

by C. Benjamin Cooper, Cooper Elliot

The current U.S. Supreme Court term includes a variety of cases important to business. Here’s a brief look at five of them.

In October, the high court heard a set of cases involving claims of employer discrimination based on sexual orientation and gender identity. The Court will decide whether Title VII, the federal workplace anti-discrimination law, prohibits an employer from taking adverse action against an employee because they are gay or transgender. The decision will likely have a major impact on the availability of these claims in employment litigation.

In November, in a case called Retirement Plans Committee of IBM v. Jander, the justices considered the liability of a corporate officer who manages a pension plan that invests in employer stock (i.e., an ESOP). In this case, officers of IBM were fiduciaries of an IBM pension plan that invested in the company’s stock. The officers learned inside information suggesting that the value of the stock would likely decline. Must the officers disclose the inside information and stop buying the stock? The Court will provide guidance soon.

Health insurers will note a set of cases argued in December involving the Affordable Care Act. The ACA set up a system to at least partially reimburse insurers who lose money on policies for people with preexisting conditions. Congress, however, later cut the funds available to pay the insurers, resulting in what one plan’s attorney called “a bait-and-switch of staggering dimensions in which the government has paid insurers $12 billion less than what was promised.”

Finally, in Spring 2020, the Court will hear two cases with massive potential implications. The first challenges the structure of the Consumer Financial Protection Bureau. If the justices agree that the structure is unconstitutional, their decision could upend all of the CFPB’s actions in the nine years since its creation. And in Google v. Oracle, the Court will decide, among other things, whether software interfaces—a building block of modern software development—can be copyrighted.

Decisions on each case are expected by the end of June 2020.