Supreme Court Accepts 3 Cases Seeking to Limit Lawsuits Against Businesses

By | June 11, 2019

The U.S. Supreme Court bolstered its next term with three new business cases, agreeing to consider curbing lawsuits over environmental cleanups, employee retirement plans and allegations of racial bias.

The justices said Monday they will hear an appeal by a BP Plc unit seeking to shield companies from environmental cleanup lawsuits that go beyond what federal regulators have ordered.

The court also accepted an Intel Corp. appeal that would tighten the deadlines for lawsuits over investments made by worker retirement plans. And the justices will hear from cable television provider Comcast Corp. in a clash with a black-owned media company.

All three cases will be set for the nine-month term that starts in October.

The court announced the new cases Monday while saying it wouldn’t hear challenges to the federal registration requirement for gun silencers. The court also rejected an appeal from one of the 40 inmates still being held at Guantanamo Bay, refusing to question the government’s power to continue to hold people there without criminal charges.

Montana Landowners

In the BP case, the justices will review a Montana Supreme Court decision that allowed a suit by property owners whose land was contaminated by arsenic discharged decades ago from a copper smelter. The landowners are suing BP’s Atlantic Richfield, which acquired the smelter’s operator, Anaconda Co., in 1977.

Atlantic Richfield, backed by corporate trade groups, says the landowners are improperly seeking money for restoration that conflicts with cleanup operations ordered by the Environmental Protection Agency.

The EPA designated the area as a Superfund site in 1983. Atlantic Richfield says it’s already spent $470 million implementing the EPA’s orders, and work is slated to continue until 2025.

The landowners who sued say they want a more extensive cleanup that would set a lower level of arsenic, remove more soil and install trenches and barriers to capture and treat groundwater.

The Trump administration said the Montana court was wrong to let the suit go forward but nonetheless said the case wasn’t suitable for Supreme Court review because of procedural issues.

The case is Atlantic Richfield v. Christian, 17-1498.

Intel Appeal

Intel is fighting claims by ex-employee Christopher Sulyma that the company made overly risky investments, with too much money in hedge funds and private equity. Intel says the lawsuit was filed after a three-year statute of limitations had expired.

Sulyma, who worked at Intel from 2010 to 2012, had access to electronic documents describing the investments more than three years before he sued. But he says he doesn’t recall reading those documents and didn’t learn about Intel’s hedge-fund and private-equity investments until they became the subject of news reports in 2015, the year he sued in federal court in California.

A U.S. employee-benefit law gives workers three years to sue after they have “actual knowledge” of an alleged violation. In letting Sulyma’s suit move forward, a federal appeals court said that provision “means what it says.”

“If Sulyma in fact never looked at the documents Intel provided, he cannot have had ‘actual knowledge of the breach’ because he cannot have been aware that imprudent investments were made and that other Intel fiduciaries were failing to monitor or remedy that imprudence,” the three-judge panel said.

A different federal appeals court reached the opposite conclusion in 2010, saying employees don’t get more time just because they failed to read documents that were available to them.

In its appeal, Intel said that “the concept of actual knowledge is broad enough to encompass situations in which the plaintiff possesses the necessary information without any need for further inquiry.”

Sulyma, whose suit seeks class-action status, urged the court not to hear the appeal.

“If someone receives a book as a present and does not read it, they do not have ‘actual knowledge’ of what the book is about,” he argued.

The case is Intel v. Sulyma, 18-1116.

Cable TV Discrimination

Comcast is attempting to stop a lawsuit by Entertainment Studios Networks Inc., which says racial discrimination is the reason it couldn’t get its channels onto the carrier’s cable systems.

At issue is a provision known as Section 1981, a Reconstruction-era law that bars racial discrimination in contracting. Comcast says the appeals court improperly made it easier to sue under that statute than under other civil rights laws.

Entertainment Studios, owned by comedian and producer Byron Allen, says it tried for years to get its channels carried by Comcast. The suit alleges that Comcast officials refused to reach a deal, even while expanding offerings of lesser-known, white-owned channels. Entertainment Studios is pressing a similar suit against Charter Communications Inc.

In letting the suits go forward, the San Francisco-based appeals court said Entertainment Studios needed to show only that racial discrimination was a “motivating factor” in the decisions.

Comcast, which says its decision was made for legitimate business reasons, says Section 1981 requires Entertainment Studios to show that it would have received a contract had it not been for racial bias. That’s a standard the Supreme Court has applied in other contexts, including claims of age discrimination and retaliation.

The case is Comcast v. National Association of African American-Owned Media, 18-1171.

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