Threat to impose costs under arbitration clause may be retaliatory

The Appellate Division holds that an employer violates the New York State Human Rights Law when it threatens a discrimination plaintiff that his SDHR charge must be litigated in arbitration and that, if the plaintiff does not pursue that route, he may be subject to costs and attorneys' fees.

The case is In the Matter of Charter Communications v. Eisen, a Fourth Department ruling issued on June 26. This case went to an evidentiary hearing at the SDHR, which ruled in the plaintiff's favor, awarding him $7,500 for pain and suffering and imposing a $30,000 fine on the employer. Charter appealed this ruling to the Fourth Department, which sides with the SDHR and upholds the finding of liability and damages, as well as the fine.

Here are the facts:

After he was fired from his employment with petitioner, complainant filed a complaint with SDHR alleging age discrimination. Petitioner responded by sending a letter to complainant in September 2019 stating that, because of a binding arbitration agreement between the parties, complainant could not pursue his claim against petitioner through a court action. Petitioner advised complainant to "be aware" that the arbitration agreement entitled petitioner to costs and fees, including attorneys' fees, incurred if petitioner was forced to seek court action to compel complainant to resolve his dispute through arbitration instead of litigation. Petitioner then filed the instant complaint alleging age discrimination and retaliation. Thereafter, while the complaint was pending, petitioner sent complainant two additional letters in June 2020 and March 2021 asking complainant to withdraw his complaint with SDHR because of the arbitration agreement.

It is not uncommon for corporate defendants to tell the plaintiff that the claim falls within the arbitration clause. What probably made the difference was Charter's threat that plaintiff might have to pay costs and attorneys' fees if he did not proceed to arbitration. Under the legal standard, such threats "could have dissuaded a reasonable person from" pursuing the discrimination complaint.   

Supreme Court strikes down another gun regulation

The Supreme Court has issued another Second Amendment ruling, finding that Hawaii cannot enforce a law that prevents gun-owners from entering private property with their guns without the property owner's express authorization. 

The case is Wolford v. Lopez, issued on June 25. This is another 6-3 ruling that applies the Bruen decision, issued by the Court in 2022, and which makes it much more difficult to enact and enforce gun laws. Under Bruen, gun laws are unconstitutional under the Second Amendment unless the government can prove there is a historical analogue the law dating to the country's founding. This is a complex constitutional formula, and may be the most "originalist" interpretation of the Constitution we've seen from the Supreme Court. Bruen requires that lawyers and judges review laws dating to the Eighteenth Century in determining if today's laws comport with laws that were in place back in 1791.

Justice Alito says the Hawaii law "departs sharply from the standard common law rule on access to private property held open to the public. Under that rule, everyone, including those lawfully carrying firearms, may enter unless expressly prohibited from doing so. By contrast, under the new Hawaii law, no one carrying a firearm may enter without the property owner's express authorization. The effect of the new rule is to impose severe restrictions on the daily activities of residents who have satisfied the State's rigorous requirements for the issuance of a carry permit."

The majority considers the practical application of the Hawaii rule: when Johnny-citizen leaves the house in the morning, he must   

When these permit holders leave home in the morning, not only must they take care to avoid all the territory where the possession of a gun is prohibited outright, but they may also be barred from entering many places that people routinely visit in the course of their daily routines, such as gas stations, convenience stores, restaurants, coffee shops, drug stores, grocery stores, “big box” stores, home improvement stores, barber shops or hair salons, dry cleaners, and laundromats. This regime hobbles what the Second Amendment protects: the right of Americans to carry arms for self-defense as they go about their daily lives. 

In dissent, writing for the three Democratic-appointed Justices, Justice Jackson sees the case very differently. "To hear the majority tell it, Hawaii’s law is a blatant attempt to end-run our Second Amendment precedents. But the statute at issue does no such thing. Instead, it fairly applies a first principle of property law—the right to exclude—and does no harm to the Second Amendment." 

 

NY Court of Appeals upholds mandatory retirement age for state judges

The New York Court of Appeals holds that the state's mandatory retirement age for judges -- 70 years -- is constitutional. The argument was that the retirement age -- in place since 1777 -- gets the kibosh due tot the recently-enacted Equal Rights Amendment adopted in 2024. The Court of Appeals disagrees.

The case is Miller v. State of New York, issued on June 18. The Court observes that the ERA does not specifically address the mandatory retirement, which is a strike against the plaintiffs' argument. The Court concludes that the ERA was never intended to repeal the age-limit. We got some classic statutory construction in support of this holding. Here is the summary:

The voters have spoken clearly since 1777 that judges may serve until they reach the constitutional age of retirement. That age limit has never been eliminated. For more than two centuries, the voters only modified the age limit, first during the Reconstruction era by raising the age to 70, and again in 1961, when the voters approved a certification process for certain judges and justices to serve to age 76. That limit has been fixed since then, with no ballot initiative to eliminate it and a failed effort in 2013 to raise the age to 80. The retirement age is part of New York's constitutional design. The State's voters, Legislature, members of the bench, and judicial candidates have understood that judicial service is limited in this specific way. Article I, § 11, as amended by the ERA, did not repeal article VI, § 25 (b). The retirement mandate stands. 

Not that I would expect anything less from the New York Court of Appeals, but this ruling represents remarkable self-restraint. The judges on this Court are directly affected by the retirement age, and as they grow older, they must realize that 70 is no barrier to effective judging. There are federal judges who sit on the bench through their 80's and 90's. Seventy is not what it used to be.  

Second Department takes a strong stand on AI hallucinations

The Appellate Division has imposed $11,000 in sanctions against a lawyer and his firm for submitting an appellate brief containing fake case citations, what the legal world now calls hallucinations. This appears to be the Second Department's most extensive discussion thus far on the practice of using artificial intelligence for legal research without double-checking the ensure the AI-generated research is finding real or imagined cases.

The case is Landberg v. City of New York, issued on June 23. Every generation has its new problems. For lawyers, its AI, which can produce research results quickly and provide case citations. The problem is that AI may either make up a non-existent case or cite a real case with holdings that do not appear in the case. What we are seeing -- from the multitude of rulings like this one -- is that some lawyers are using AI for legal research without reading the cases and determining if they are accurate or even if the cases exist. The courts have had it with AI hallucinations, and decisions are issuing nearly every day condemning the practice. Take a look at this database, updated daily.

In this personal injury case, the brief had a number of fake case citations, and the Appellate Division asked counsel about it at oral argument, offering him a 15-minute recess to figure things out. Counsel declined the invitation and "initially confirmed that the authorities within the brief came from Lexis, Westlaw, or a book, or were 'cited from a previous case,'" though "he later hypothesized that the erroneous citations may have possibly been the product of him 'over-relying' on 'other briefs' or string cites." 

This is humiliating for the lawyer, so I will keep his name out of this discussion. I guess the Second Department wants to make a statement in this case, so it details counsel's response to the order to show cause on sanctions:

[Counsel] stated that in connection with his research, he recalled "utilizing traditional legal research resources, including Westlaw, appellate briefs, publicly available sources, and other secondary materials. However, [he] also recall[ed] utilizing artificial intelligence-assisted research tools but [did] not recall which exact tool [he] used, it was one of the free ones available to the public." [Counsel]  stated that after carefully reviewing the brief, it was his "belief that the non-existent citations identified by the Court originated during the AI-assisted portion of [his] supplemental research which [he] negligently failed to verify before filing [the plaintiff's] brief with this Court." [Counsel] stated that this was a violation of the policy of the law firm, which "had made known its policy that all AI generated citations to facts and the law required personal review and confirmation by the lawyers using artificial intelligence tools."

[Counsel] further stated in his affirmation that when he appeared for oral argument and the Court asked him where the fabricated cases came from, he "should have stated that they were hallucinated by artificial intelligence. [He] was genuinely scared at the time. It felt like [his] career was on the line, and [he] was afraid to even use the words 'AI.'"  [Counsel] went on to "expla[in], not justif[y]" that he was "confused and stunned at the questioning because [he] was prepared to address the nuance of the cases [he] cited for the central legal issue as to whether the location of the accident qualified as a 'tree well' within the meaning of Administrative Code § 7-210. The cases with the wrong citations were cited for the more simple, and [he] believed to be non-questionable basic principles of Administrative Code § 7-210."

[Counsel] stated that he was "deeply embarrassed" for his error and that he "can assure this Court with every fiber in [his] body that going forward, [he] will be extremely rigorous, to verify every citation in any paper [he] ever file[s] going forward."

That's a real mea culpa, but the Court still issues a sanction. It notes that we all know about the dangers of AI research, citing to a New York Times article on the issue. The Court then says that counsel's response to questioning at oral argument was inappropriate:

when confronted about the fabricated cases cited in his brief at oral argument, [Counsel] declined the opportunity to take a 15-minute recess to discern where he had found the cases, and maintained that he had found them either on Westlaw or Lexis or in a book, a previous case, or another brief. As [Counsel] later admitted in his affirmation, he was not being candid at the time of oral argument, as he should have said that the cases were hallucinated by artificial intelligence. [Counsel] "expla[ined]" that his decision to be dishonest with the Court was due to being "scared." This may be true.

However, [Counsel]'s decision not to be honest with the Court during oral argument also demonstrated his professional immaturity, arrogance, and profound lack of respect for the judicial system.

Even after being given the opportunity to respond to the Court's concerns in writing, it appears that [Counsel] was still not completely candid. In his affirmation, [Counsel] recalled using artificial intelligence research tools in connection with his supplemental legal research, which he blamed for the three fictitious cases that were cited for what he believed to be "non-questionable basic principles" of law. However, as outlined above, the brief that [Counsel] submitted did not merely contain fictitious case citations for non-questionable principles of law. The brief also contained fabricated quotations from the Court of Appeals, which said the opposite of what the Court of Appeals has actually said about whether Administrative Code § 7-210 is to be construed liberally or strictly. 

In addition, the brief completely misrepresented what was decided or discussed in two real cases cited therein. Since "fabricated quotations from actual cases" and "misstatements of law that are not representative of what a case actually decided" are well-recognized "pitfalls posed by the use of GenAI in drafting briefs" (Matter of Julien v Arthur, ___ AD3d at ___, 2026 NY Slip Op 03308, *1-2), it appears that GenAI was used to do more than simply conduct supplemental research, as suggested by [Counsel] in his affirmation.  [Counsel] wholly failed to fulfill his obligation to review the work of GenAI to prevent the submission to this Court of a brief containing significant misrepresentations of the law.

Counsel was sanctioned $8,500 and his law firm -- where Counsel is an associate -- was sanctioned $2,500 for the AI hallucinations. You should know that the lawyers on the other side of the appeal were also grilled by the Appellate Division panel on the fake citations, and they asked counsel why they did not flag this issue writing their own briefs. These lawyers were not sanctioned, by the oral argument makes it clear that all lawyers have a duty to tell the court when their adversary is citing hallucinations.

 

Court scales back religious freedom law

The Supreme Court has held that a prisoner cannot sue prison guards for cutting off his religiously-inspired Rastafarian hair. This decision narrowly interprets the Religious Land Use and Institutionalized Persons Act of 2000, a religious freedom law which generally allows you to sue the government when it violates your religious rights.

The case is  Landor v. Louisiana Dept. of Corrections, decided on June 23. The plaintiff wore long hair and carried around a court decision stating the prison cannot shave his head upon entry to the facility. That decision may have been good law at the time, but it does not help the plaintiff. Why? He sued under RLUIPA, which is not like other civil rights laws in that it says governmental institutions, upon accepting federal money (and most of them do) accept that money in return for consenting to answer lawsuits under the statute. If you take federal money, then you must allow for lawsuits against you. But that contract must be knowing and voluntary. 

Here is an example: in 1987, the Court said that Congress can distribute highway funds to municipalities on condition that they raise the drinking age to 21. This unusual equation arises from the statute's relationship to the Spending Clause under the Constitution. The federal government can spend money for the general welfare and may therefore attach conditions for the receipt of federal money. But, the Court rules in a 6-3 decision, that consent to lawsuits will not apply when the plaintiff is suing individual defendants, who, while working for an institution that accepts federal money, did not themselves consent to be sued. That is a narrow interpretation of RLUIPA Here is the crux of Justice Gorsuch's reasoning:

Under the Spending Clause, Congress lacks regulatory authority to impose liability on them directly and must depend instead on consent. And because they never agreed to answer suits like this one, Mr. Landor’s case cannot proceed against them any more than a breach of contract action might proceed against a defendant who never formed a contract. 

It is true that the modern Court is more receptive to religious freedom cases than ever before. But Spending Clause statutes like RLUIPA are not like other statutes that also protect religious freedom, like Title VII of the Civil Rights Act of 1964, which is not a Spending Clause statute. In recent years, the Court has been scaling back the protections of civil rights laws enacted under the Spending Clause, holding a few years ago that these statutes do not provide for pain and suffering damages.

The only way to change this is through a new law. But protecting religious freedom has been difficult in the federal world, ever since the Court scaled back the Free Exercise Clause in 1990 in Employment Division v. Smith. In response to that case, Congress passed a law to restore religious religious, but the Court struck it down and created an incomprehensible legal test to determine whether certain laws passed under the Fourteenth Amendment may survive constitutional review. These new laws ultimately led to RLUIPA, one of the few bipartisan statutes passed by our fractured Congresses in the last few decades. But the law only means what the Court says it does, and for plaintiff, it means he has no case. 

 

Supreme Court reinstates high profile child murder verdict

The Supreme Court has reinstated the criminal conviction of the man found guilty of the highly-publicized kidnapping and killing of a boy in New York City in 1979.

The case is McCarthy v. Hernandez, issued on June 22. We have a 6-3 vote, with Sotomayor, Kagan and Jackson dissenting.

The killing of Etan Patz shocked the world at a time when crime in New York City was reaching a peak; he stopped into a bodega on his way to school and no one ever saw him again. The crime was unsolved for decades until the police arrested Pedro Herhandez, who confessed to the crime to a relative and then to the police. The problem with the police confession was that the police began asking him questions without providing his Miranda warnings ("You have the right to remain silent ..."). Once they read him his rights, Hernandez waived them and made a second confession. He gave another confession at the DA's office after waiving his Miranda rights.

At the criminal trial, the jury wanted to know what to do if they thought the pre-Miranda confession was involuntary -- should they disregard the two later videotaped confessions, where he waived his Miranda? The trial court explained that although New York law requires a jury to disregard confessions that it finds were “involuntarily made," state law does not empower a jury to assess whether a later confession is fatally tainted by an earlier, “involuntary” confession. 

The Second Circuit granted him habeas relief, determining that the state court criminal trial violated Hernandez's constitutional rights because the interrogation tactics violated Missouri v. Seibert, 542 U.S. 600 (2004), a splintered ruling that held that police questioning like this violates federal law. As the Supreme Court describes the Seibert ruling, "Writing for a four-Justice plurality, Justice Souter opined that the use of the tactic had undermined the protection that Miranda was designed to provide and that the confession given after the tardy Miranda warning was therefore inadmissible." 

That language from Seibert may seem to help Hernandez in this case, and as noted, the Second Circuit agreed, Not so, says a divided Supreme Court, which holds that Hernandez had no federal right to have the jury evaluate the lawfulness of his confessions after the trial court admitted them at trial. New York law may provide for that right, but the U.S. Constitution does not. Even if Seibert provides for the controlling legal standard -- and that proposition is debatable since it was a splintered ruling -- "that opinion established nothing about a jury's determination of a confession's legality," as Seibert's context was the trial court's ruling on a suppression motion, not a jury's assessment of attentuation" The Supreme Court has never applied Seibert in any other procedural context.

Since the trial court did not violate clearly-established federal law in guiding the jury on how to assess the confessions, there is no habeas corpus relief and the conviction is reinstated. 

Second Circuit reinstates racial discrimination case

The Court of Appeals has reinstated a racial discrimination lawsuit, holding that the plaintiff alleged enough facts in her complaint to plausibly assert that she was denied a promotion and then terminated from her position because of her race.

The case is Brooks v. Bright Horizons, a summary order issued on June 10. I represented the plaintiff on appeal. Keenan & Bhatia handled the case in the district court.

Plaintiff is Black, and her supervisor is white. Plaintiff alleges the white supervisor singled her out for mistreatment, as compared to her white co-workers. When plaintiff put in for a promotion for which she was qualified, someone else was chosen for the position; the selectee was not Black. According to the lawsuit, the selectee was not qualified for the position, as he lacked some of the prerequisites set forth in the job posting. When Plaintiff asked why she did not get the position, her supervisor said that she needed more experience supervising people who are "not like you." In explaining further, the supervisor mentioned an Asian-American director and another employee who is a non-Black Latina. Plaintiff was later fired. That same supervisor orchestrated her termination, claiming that plaintiff did not comply with COVID protocols, even though one of plaintiff's white subordinates who made the decision that broke the protocol was not disciplined. A white woman replaced plaintiff.

The Court of Appeals applies a settled rule in reinstating the failure-to-promote and termination claims: if the promotion is given to someone outside the protected class, and if you are fired and replaced by someone outside the protected class, that's a prima facie case, and if you plead a prima facie case, then the case cannot be dismissed. The Second Circuit more recently articulated this rule in Littlejohn v. City of New York (2015). The Court did not address whether the "not like you" comment carried a racial implication, though the Court did cite that allegation in the statement of facts.

If the cases are settled that plaintiff plead a prima facie case, then why was the case dismissed? Because some district courts, and a few Second Circuit summary orders (which are not precedential) are now holding that replacement by someone outside the protected class is not always enough to make out a prima facie case. No published Second Circuit holds as such. Here is how the Second Circuit (Nardini, Lee and Robinson) handled that issue:

The district court acknowledged our holding in Littlejohn, but relied on a subsequent summary order of this Court to conclude that we had “more recently cautioned that the succession of an employee by a person outside the protected class, standing alone, cannot give rise to a plausible inference of discrimination.” Joint App’x at 102 (citing Marcus v. Leviton Mfg. Co., Inc. 661 F. App’x 29, 32 (2d Cir. 2016) (“Without more, the mere fact that an older employee was replaced by a younger one does not plausibly indicate discriminatory motive.”)). But Marcus did not—indeed could not—undermine what we held in Littlejohn. Procedurally, a summary order is nonbinding, and even a published opinion of a later panel cannot override the published opinion of an earlier panel. In any event, we discern no tension between our two decisions. In Marcus, we were addressing what we described as “skeletal pleading” in a complaint that alleged simply on “information and belief” that the plaintiff had been replaced by a younger employee, without any supporting facts—not even the purported age of the new employee. 661 F. App’x at 32-33. Brooks’ amended complaint is far more detailed and alleges specifics about differential treatment that was accorded to her and a similarly situated employee of Bright Horizons.

What we see is a principle, still unavailable in any published case, that replacement by someone outside the protected class may not be enough to avoid Rule 12 dismissal, but only if there is skeletal pleading that does not otherwise suggest an inference of discrimination. The rule in  Marcus is still the exception. The general rule guiding Iqbal pleading is to write a detailed complaint no matter what. If you've got it, plead it. 

 

Bad court reporter! Bad!

During the criminal trial, the court reporter was unable to capture substantial portions of the trial proceedings. So the stenographer instead recorded, "blah, blah, blah," "blah blah," "omitted," or undecipherable characters instead of the words actually spoken. This is what you read if you were going through jury selection, portions of the trial, jury notes and the verdict. The problem is you need a real transcript for the appeal. 

The case is People v. Meyers, issued by the New York Court of Appeals on May 26. The half-elbowed transcripts surfaced when defendant -- who was convicted of orchestrating a house fire in order to win someone's life insurance -- took up an appeal. I am sure panic ensued when the appellate lawyer realized the transcripts contained all the nonsense. Here is a sample of what the transcript looked like, when the trial judge addressed the jury:

"A trial jury is composed of 12 people. In addition to the 12 jurors, we also, blah, blah, sworn in as a trial juror will serve as the jury's foreperson. You've heard reference to the fact that the defendant was indicted by a grand jury. This is not and must not be taken guilty you, blah, blah, trial jury must consider an indictment by, blah, blah, accused of a crime. Only you as members of the trial jury can determine guilt. A defendant is presumed innocent and until you (untranscribable) find him guilty." 

You can "yada yada yada" your way through a Seinfeld plot but you can't "blah, blah, blah" you way through a criminal trial.  

The trial court held a four-day reconstruction hearing, during which the court heard testimony from the trial judge who presided over the case, the judge's law clerk, all the lawyers who handled the case, and collected notes taken from judge during trial. The hope was that the court could reconstruct what actually happened at trial besides "blah, blah, blah." 

The case reached the New York Court of Appeals on the theory that defendant deserved a new trial because he did not have a proper trial record. But the Court holds that the reconstruction hearing was adequate and other, non-stenographic evidence, was preserved, including video of defendant and his wife visiting the home right before the fire and removing bags of materials from the home, presumably the stuff that defendant did not want burned into oblivion. As for the reconstructed trial record, defendant has not shown any appealable issues relating to those portions of the trial that were not adequately recorded by the court reporter. 

Second chance for murder defendant due to potential Batson violation

At this criminal trial, the prosecutor used his peremptory challenges to remove a series of Black jurors from the case. The criminal defendant was convicted of capital murder but challenged the fairness of the trial due to what he claimed was the racially-motivated jury selection process. He wins in the Supreme Court.

The case is  Pitchford v. Cain, issued on May 28. Never let anyone tell you that a conservative Supreme Court does not always rule in a liberal manner. This is a 5-4 decision, with Justices Kavanaugh and Roberts voting with the three liberals.

In this case, during jury selection, the prosecutor struck four potential jurors, all of them Black. The defendant's lawyer objected on Batson grounds. Under Batson, named after a Supreme Court ruling from 1986, upon such an objection, the prosecutor has to articulate a race-neutral reason for striking the Black jurors. The judge then has to decide -- on the spot -- if that justification is a pretext, or a knowingly false reason. The prosecutor does not have a heavy burden in defending his choices, but this procedure must be followed.

Although the jury convicted the defendant of murder, yielding a 20-year sentence, the Supreme Court grants the habeas corpus petition, holding that the state courts did not reasonably apply Court precedent on this issue. Remember that habeas petitions are not granted simply because the state court did something unconstitutional during trial. The criminal defendant has to show the state court did not reasonably apply Supreme Court precedent. As Justice Gorsuch writes in dissent, "showing legal error . . . isn't enough to satisfy [the habeas statute]. Instead, a petitioner must demonstrate that no fairminded jurist could reach the state court's conclusion under this Court's precedents." So a mere constitutional violation is not enough. The habeas equation, in my view, is one of the greatest anomalies in federal law. But that's a lecture for another day.

What went wrong at the criminal trial was this: the criminal court judge said the prosecutor articulated a neutral reason for striking the Black jurors, but it did not afford defense counsel a chance to rebut the prosecutor's race-neutral reasons as pretextual. Nor did the criminal court make any findings regarding whether the prosecutor's reasons were a pretext for race discrimination. When jury selection ended, defense counsel again raised an objection, to no avail. The trial court cut him off. The defendant gets another shot at challenging the prosecutor's actions, potentially leading to a new trial with a fresh jury. Hey, everyone deserves a second chance, right?

 

 

Supreme Court narrowly interprets Federal Arbitration Act for intrastate bakery drivers

The Supreme Court last week narrowly interpreted the Federal Arbitration Clause -- which favors arbitration and usually produces court rulings for management, which does not want cases in court but instead through the private arbitration process -- to mean that certain bakery and junk food drivers cannot be forced into arbitration when management denies them a proper paycheck.

The case is Flowers Foods v. Brock, issued on May 28. Under the FAA, you cannot compel arbitration in disputes involving the "contracts of employment" of any class of workers "engaged in ... interstate commerce." Since Flowers distributes food all over the country, requiring its drivers to cross state lines, the question is whether the plaintiffs may pursue their claims in open court instead of arbitration -- which will grant you a ruling, albeit on an expedited basis with more limited discovery, no jury, and where the arbitrators' rates are often paid by the employer. See why plaintiffs don't like arbitration? They dislike arbitration so much that they will take this issue to the Supreme Court (an expensive and time-consuming process), which issues a ruling long after the arbitrator might have resolved the case once and for all.

What makes this case unique is that plaintiff did not actually cross state lines in delivering the baked goods. Instead, his "intrastate route formed a constituent part of the ... interstate journey of Flowers's goods from out-of-state bakeries to their intended destinations at retain stores." On these facts, can plaintiff still avoid arbitration under the statute? A unanimous court rules that, under the FAA, workers qualify as engaging in interstate commerce even if they never cross state lines and never interacts with vehicles who cross state lines. That's plaintiff Brock. He gets to litigate his wages claim in court, not arbitration.

The Supreme Court reaches this holding after analyzing, through dictionaries, what certain language in the FAA really means, words like "engage," which the dictionary interpreted to "take part in something or to be employed or involved in that thing." "Engage" has a broad definition, and we presume that Congress had that broad definition in mind when it enacted the FAA many years ago. 

Justice Gorsuch writes that "nothing in those terms requires an individual to cross state lines or to interact with a vehicle that does. "Interstate commerce includes transporting products between points in one state and points in another state. That involves not just crossing state lines, but intrastate activity too. Though a continuous carriage may begin in one State and end in another, much of the journey can take place within the limits of a single state. And at least sometimes, a person can take part, be employ[ed], or be involve[d] in that continuous journey without leaving a State or touching vehicles that do." No case law supports this holding, by the way. It all comes from what must be a hell of a dictionary collection at the U.S. Supreme Court library. I say this because the Court often reviews the dictionary -- including those published at or around the time a certain statute was enacted -- to understand what Congress must have intended in enacting certain statutes.

This case is the fourth in a recent like of cases narrowly interpreting the FAA to exempt certain transportation industry workers from mandatory arbitration. The Court writes:

In recent years, we have had occasion to address the scope of §1’s exemption no fewer than three times. In each case, we have rejected efforts to cabin its reach. First, in New Prime Inc. v. Oliveira, 586 U. S. 105 (2019), we held that the “contracts of employment” §1 embraces include contracts governing independent contractors, not just employees. Then, in Southwest Airlines Co. v. Saxon, 596 U. S. 450 (2022), we held an airline worker who loaded and unloaded cargo fit within §1’s exemption even though she did not fly planes or otherwise cross state lines. Finally, in Bissonnette v. LePage Bakeries Park St., 601 U.S. 246 (2024), we held that a worker can fall under §1 whether he is employed in  the “transportation industry” or some other, so long as his work “play[s] a direct and necessary role in the free flow of goods across borders.” Make this case the fourth.

$76,000 First Amendment verdict is taken away

This case has been kicking around for quite some time. The plaintiff argues that the Town of Babylon (on Long Island) accused him of violating the Town's rental permit requirements in violation of the First Amendment (he claimed the Town retaliated due to his free speech) and due process. The First Amendment claim survived pre-trial motion practice, and the case -- originally filed in 2012 -- went to trial in 2019. Plaintiff won the trial. But things did not end with that victory. Oh Lord, they did not.

The case is Mangino v. Town of Babylon, a summary order issued on May 29. The retaliation theory was that the Town denied approval of his rental permit and initiated civil enforcement proceedings against him because he had previously objected to the Town's fee practices and enforcement methods. So, the kinds of issues that normally play out in state court -- zoning, etc -- became a federal lawsuit due to plaintiff's First Amendment claim. The jury ruled in plaintiff's favor, awarding him approximately $76,000 in damages. 

But wait! The trial court set aside the verdict as agains the weight of the evidence and ordered a second trial. This time around, the Town won the case. Plaintiff now appeals from the earlier order throwing out the favorable verdict. He loses the appeal. 

The Court of Appeals (Walker, Lee and Robinson) reviews that order under the "abuse of discretion" theory, which is highly favorable to the trial court. Appellate courts give the trial judges the benefit of the doubt in making these rulings. The trial court is in the best position to know if the evidence really supports the verdict and whether the interests of justice warrant a new trial. This case is no different. The Second Circuit holds that the trial court "carefully reviewed both testimonial and documentary evidence and concluded that the first verdict could not be reconciled with the record." The trial court found that the verdict simply could not be supported by the trial evidence, which had serious holes in it, the Court of Appeals finds.

We tell juries that they are the ultimate arbiter of the case and that we trust their judgment. When the jury renders its verdict, it leaves the courthouse believing the case is over and they did their job. The jury has no idea the case continues while the judge and the attorneys -- and maybe even the Court of Appeals -- picks through the evidence to see if the jury got it right. This case is a good example of that. It is uncommon for the trial judge to set aside a plaintiff's verdict on these grounds, but it does happen. The lawyers may understand the trial court's reasoning in ordering a new trial after the plaintiff has already prevailed. My guess is that plaintiffs will always be confused about what happened: we won the trial, the trial judge took away the verdict, we had a second trial, and a new jury ruled against us.