Justia Government & Administrative Law Opinion Summaries

The United States Court of Appeals for the Fifth Circuit reversed and vacated parts of a judgment against EOX Holdings, L.L.C., and Andrew Gizienski ("Defendants") in a case initiated by the Commodity Futures Trading Commission ("CFTC"). The CFTC had accused the defendants of violating a rule that prevents commodities traders from "taking the other side of orders" without clients' consent. The court ruled that the defendants lacked fair notice of the CFTC's interpretation of this rule. The case revolved around Gizienski's actions while working as a broker for EOX, where he had discretion to make specific trades on behalf of one of his clients, Jason Vaccaro. The CFTC argued that Gizienski's actions violated the rule because he was making decisions to trade opposite the orders of other clients without their knowledge or consent. The court, however, ruled that the CFTC's interpretation of the rule was overly broad, as it did not provide sufficient notice that such conduct would be considered taking the other side of an order. The court reversed the penalty judgment against the defendants, vacated part of the injunction against them, and remanded the case for further proceedings. View "Commodity Futures v. EOX Holdings" on Justia Law

The Supreme Court of Missouri reversed the circuit court's ruling and held that the Truly Agreed and Finally Passed House Bill 1606 (2022) (“TAFP HB 1606”) violated the single subject requirement of article III, section 23 of the Missouri Constitution. The bill was initially proposed to reduce the amount of information certain counties had to publish in their financial statements. However, the bill underwent several modifications, including the addition of section 67.2300, which imposed restrictions on the expenditure of state funds for combating homelessness and made unauthorized sleeping and camping on state-owned lands a class C misdemeanor. The appellants, including a group of individuals and a non-profit organization, argued that the addition of section 67.2300 altered the bill's original purpose, introduced a second subject to the bill, and rendered the bill's title unclear, thereby violating the single subject, clear title, and original purpose requirements of the Missouri Constitution. The court agreed, finding that the provisions of section 67.2300 did not fairly relate to or have a natural connection with the bill's general subject of "political subdivisions," but rather related to the completely different subject of homelessness. Consequently, the court declared TAFP HB 1606 invalid in its entirety. View "Byrd v. State of Missouri" on Justia Law

This case revolves around the filed rate doctrine and its applicability in instances where rates approved by a municipal board are questioned. The plaintiffs, a group of customers, sued Recology, a waste management company, alleging that the company violated the Unfair Competition Law and other laws by bribing a city official to facilitate the approval of Recology’s application for increased refuse collection rates. The trial court ruled in favor of Recology, holding that the claims were barred by the filed rate doctrine. The Court of Appeal of the State of California First Appellate District Division Three reversed the decision, stating that the California version of the filed rate doctrine does not bar this action because the purposes underlying the doctrine – “nondiscrimination” and “nonjusticiability” strands – are not implicated by plaintiffs’ claims. The court also concluded that the judgment in the prior law enforcement action does not pose a res judicata bar to this putative class action. The court remanded the case for the trial court’s consideration of Recology’s remaining challenges in the first instance. View "Villarroel v. Recology" on Justia Law

The Supreme Court affirmed the decision of the Minnesota Tax Court affirming the assessment of the Commissioner of Revenue assessing tax on an apportioned share of Cities Management, Inc.'s (CMI) income from the sale of the S corporation, holding that the income from the corporation's sale was apportionable business income.CMI, which did business in Minnesota and Wisconsin, and its nonresidential partial owner filed Minnesota tax returns characterizing the sale of CMI's goodwill as income that was not subject to apportionment by the State under Minn. Stat. Ann. 290.17. The Commissioner disagreed and assessed tax on an apportioned share of the corporation's income from the sale. The tax court affirmed. The Supreme Court affirmed, holding that CMI's income did not constitute "nonbusiness" income under section 290.17, subd. 6 and may be constitutionally apportioned as business income. View "Cities Management, Inc. v. Commissioner of Revenue" on Justia Law

The Shelbyville Post Office is the closest one to Ellison’s home and the largest in that area of Indiana. Ellison keeps a P.O. box at Shelbyville or her non-profit organization, which educates the public about accessibility for people with disabilities. Ellison cannot enter the Shelbyville Post Office because it has only one customer entrance: at the top of its front steps. Ellison can ask for help from the loading dock or from a van-accessible parking space, use the Postal Service’s website, or visit wheelchair-accessible locations in surrounding towns. After multiple complaints about the inconvenience of those options, the City of Shelbyville offered to pay for a ramp at the front entrance. The Postal Service declined, citing a policy of refusing donations for exterior physical improvements.In a suit under the Rehabilitation Act, 29 U.S.C. 794(a), the district court entered summary judgment, concluding that Ellison could meaningfully access the program through its website and three wheelchair-accessible locations within a 15-minute drive of her home. The Seventh Circuit vacated and remanded for consideration of whether Ellison’s proposed accommodation (a ramp) is reasonable. The Shelbyville Post Office does not provide a significant level of access, and the alternative locations are further away and open for fewer hours than Shelbyville. View "Ellison v. United States Postal Service" on Justia Law

The Department of Industrial Relations, Division of Occupational Safety and Health (the Division) issued a citation to Granite Construction Company/Granite Industrial, Inc. (Granite Construction) for allegedly violating three regulations relevant here. One was that the company required its employees to wear masks without first providing a medical evaluation to determine their fitness to wear them. And the Division alleged the company violated two other regulations because it exposed its employees to dust containing a harmful fungus— namely, Coccidioides, the fungus that causes Valley fever—and failed to implement adequate measures to limit this exposure. After Granite Construction disputed these allegations, an administrative law judge (ALJ) rejected the Division’s claims. The ALJ reasoned that no credible evidence showed that Granite Construction required its employees to wear masks and no reliable evidence showed that Coccidioides was present at the worksite. But after the Division petitioned for reconsideration, the Occupational Safety and Health Appeals Board (the Board) reversed on these issues and ruled for the Division. The trial court later denied Granite Construction’s petition for writ of administrative mandate seeking to set aside the Board’s decision. The Court of Appeal reversed: the Court agreed insufficient evidence showed its employees were exposed to Coccidioides. But the Court rejected its additional claim that it allowed (rather than required) its employees to wear masks, finding sufficient evidence supported the Board’s contrary ruling on this point. View "Granite Construction Co. v. CalOSHA" on Justia Law

Ascendium Education Solutions (“Ascendium”) is a Program guarantor that previously charged debt-collection costs to defaulting Program borrowers who entered loan rehabilitation agreements. Ascendium challenged the Department of Education’s Rule, 34 C.F.R. Section 682.410(b)(2)(i), under the Administrative Procedure Act (“APA”), arguing that the Department of Education and its Secretary (collectively, the “Department”) did not have statutory authority to promulgate the Rule because the Rule conflicts with the Act. The district court ruled that Ascendium lacked standing to challenge the Rule as it applies to borrowers who enter repayment agreements. But the district court held that the Rule exceeded the Department’s authority under the Act with respect to borrowers who enter rehabilitation agreements. Both Ascendium and the Department appealed.   The DC Circuit reversed in part and affirmed in part. The court concluded that Ascendium has standing to challenge the entirety of the Rule, that the Rule is consistent with the Act and therefore is lawful, and that the Rule is not arbitrary or capricious. The court explained that the Rule prohibits a guarantor from charging collection costs to a borrower who enters a repayment plan or a rehabilitation agreement during the initial default period: It implicitly deems such costs “unreasonable” under the circumstances. The court concluded that the Rule is consistent with the Act’s requirement that “reasonable” collection costs must be passed on to borrowers. Further, the court explained that the Department’s response to Ascendium’s comment adequately refuted Ascendium’s assumption that the purpose of the Rule should be to incentivize guarantors to enter rehabilitation agreements by allowing them to charge collection costs. View "Ascendium Education Solutions, Inc. v. Miguel Cardona" on Justia Law

The Supreme Judicial Court held that the Secretary of the Commonwealth did not overstep the bounds of the authority granted to him under the Massachusetts Uniform Securities Act (MUSA), Mass. Gen. Laws ch. 110A, by promulgating the "fiduciary duty rule."The Secretary brought an administrative enforcement proceeding alleging that Plaintiff Robinhood Financial LLC violated the prohibition in Mass. Gen. Laws ch. 110A, 204(a)(2)(G) against "unethical or dishonest conduct or practices in the securities, commodities or insurance business" by dispensing ill-suited investment advice to unsophisticated investors. The Secretary defined the phrase in section 204(a)(2)(G) to require broker-dealers that provide investment advice to retail customers to comply with a statutorily-defined fiduciary duty. Thereafter, Plaintiff brought the instant action challenging the validity of the fiduciary duty rule. The superior court concluded that the Secretary acted ultra vires to promulgating the rule. The Supreme Judicial Court reversed, holding (1) the Secretary acted within his authority under MUSA; (2) the fiduciary rule does not override common-law protections available to investors; (3) MUSA is not an impermissible delegation of legislative power; and (4) the fiduciary rule is not invalid under the doctrine of conflict preemption. View "Robinhood Financial LLC v. Secretary of the Commonwealth" on Justia Law

Plaintiff HNHPC, Inc., appealed a judgment entered in favor of Defendants the Department of Cannabis Control (the Department) and Nicole Elliott. The complaint alleged the Department failed to perform its mandatory duties and/or failed to properly perform discretionary duties under the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA). Plaintiff contended the court erred by taking judicial notice of certain documents and by sustaining defendants' demurrer. In sustaining defendants’ demurrer, the court took judicial notice of two government contracts with a contractor to design the track and trace system and the Department’s budget request for the 2021-2022 fiscal year. Relying on these documents, the court found the Department had complied with its ministerial duties under Bus. & Prof. Code section 26067. Assuming, without deciding, that the trial court properly took judicial notice of the documents, the Court of Appeal found the complaint still stated a claim for a writ of mandate and injunctive relief because the judicially noticed documents did not contradict the complaint's allegations. Because the complaint adequately pleaded facts to state a cause of action for a writ of mandate and for injunctive relief, the Court of Appeal reversed the judgment. View "HNHPC v. Dept. of Cannabis Control" on Justia Law

Vectren Infrastructure Services Corporation, the successor in interest to Minnesota Limited, Inc. (ML), sued the Department of Treasury (the Department) in the Michigan Court of Claims, alleging that the Department had improperly assessed a tax deficiency against ML after auditing ML’s Michigan Business Tax returns for 2010 and part of 2011. Following an audit, the Department determined that ML had improperly included its gain from a sale of its assets in the sales-factor denominator, resulting in an overstatement of its total sales and the reduction of its Michigan tax liability. The auditor excluded ML’s sale of assets from the sales factor and included it in ML’s preapportioned tax base, which increased ML’s sales factor from 14.9860% to 69.9761% and consequently increased its tax liability. ML asked the Department for an alternative apportionment for the period in 2011 before the sale, January 1, 2011 to March 31, 2011 (the short year), but the Department denied ML’s request and determined that ML had not overcome the presumption that the statutory apportionment fairly represented ML’s business activity in Michigan for the short year. The Court of Appeals ultimately held the Court of Claims had correctly analyzed the relevant statutes and applied the apportionment formula; however, the Court of Appeals concluded that Vectren was entitled to an alternative apportionment because applying the formula extended Michigan’s taxing powers beyond their acceptable scope, and ordered the parties to work together to determine an alternative method of apportionment. The Michigan Supreme Court held: (1) the income from the asset sale was properly attributable under the MBTA; and (2) the MBTA formula, as applied, did not impermissibly tax income outside the scope of Michigan’s taxing powers. The Court reversed the Court of Appeals and remanded this case to the Court of Claims for further proceedings. View "Vectren Infrastructure Services Corp v. Department Of Treasury" on Justia Law