Sunday, December 18, 2016

Supreme Court Should Invalidate Electoral College

      "The electoral college ought to have been struck from the Constitution or invalidated by the Supreme Court long ago," I argue in an op-ed published in theLos Angeles Times [Dec. 16]. "Donald Trump’s electoral college victory — despite Hillary Clinton’s lead of more than 2.5 million in the popular vote — is only the latest proof that it’s the wrong way to choose a president."
      My original submission was longer and more explicit in setting out the legal grounds and political rationale. Here, for your further consideration. I will have more to say in coming days on fixing the flaws in the United States' imperfect Constitution.
* * *

      The Electoral College is unconstitutional.
      It is unconstitutional because it was born out of a morally offensive political decision aimed at preserving the status of slavery in the South.
      It is unconstitutional because it has never functioned in the supposedly deliberative manner that its authors depicted in selling it to voters during the ratification debates.
      It is unconstitutional because it conflicts with the “one person, one vote” rule that the Supreme Court has applied for the past 50 years to elections for every other elective office in local, state or federal governments.
      It is unconstitutional because under current political conditions it does not operate as its defenders claim to incentivize presidential candidates to campaign in all 50 states, from the biggest to the smallest.
      And it falls to the Supreme Court to rule the system unconstitutional because its defects are safeguarded from a constitutional amendment by the effective veto power of the small states that supposedly benefit from the system.
      Start at the Constitutional Convention in Philadelphia in 1787, where Pennsylvania’s James Wilson proposed direct election of the president only to be shot down by the slave-owning Virginian James Madison. As Yale’s distinguished constitutional law scholar Akhil Amar has recently explained, Madison demurred because Northern states allowed voting more “diffusively” than states in the South.
     The South’s non-voting slaves would have counted for nothing in a popular-vote system. But slaves increased the electoral votes from the South and thus its political clout because the Three-Fifths Clause counted them for apportionment in the House of Representatives.
     The ink was barely dry on the Constitution when the Twelfth Amendment was ratified in 1804 to replace the harebrained provision that the presidential runner-up serve as vice president. Ever since, the major political parties have fielded competing presidential and vice-presidential tickets, and the electors have been relegated to voting according to the popular vote in their respective states.
     The Constitution never uses the phrase “Electoral College,” nor have the electors ever met as a collective body. The Constitution specifies that they cast their ballots in their respective states. But Alexander Hamilton sold the system to voters in Federalist No. 68 on the ground that the president would be chosen by “men [sic] most capable of analyzing the qualities adapted to the station, and acting under circumstances favorable to deliberation . . . .”
      Today, electors’ names do not even appear on most states’ ballots. The occasional elector who votes differently from the popular vote is not praised not for deliberation but criticized as “faithless.” For better or worse, none of the 157 faithless electors in U.S. history before the 2016 contest, as compiled in a Wikipedia entry, have affected the outcome of a presidential election. The Supreme Court ruled in 1952 that states can punish a faithless elector after the fact but cannot prevent electors from casting their votes as they see fit.
      The Supreme Court ruled in 1964 that states cannot use an unevenly weighted voting system in choosing statewide officeholders. The 8-1 ruling in Wesberry v. Sanders struck down Georgia’s county unit system, which gave rural voters significantly greater weight than voters in urban counties.
      Justice William O. Douglas acknowledged, with a critical footnote, the constitutional basis for the Electoral College, but he concluded that states had to give all voters equal weight. “The conception of political equality from the Declaration of Independence, to Lincoln's Gettysburg Address, to the Fifteenth, Seventeenth, and Nineteenth Amendments can mean only one thing — one person, one vote,” he wrote.
      If states are foreclosed from giving rural voters more weight than urban voters in choosing governors or senators, the federal government should be equally foreclosed from giving voters in red-state Wyoming or blue-state Rhode Island more weight in choosing a president than those in blue-state California or red-state Texas. The court held in the District of Columbia school desegregation case in 1954 that the Fifth Amendment, ratified three years after Article II with its provisions for electing the president,  includes an equal protection component applicable to the federal government.
      Supporters of the Electoral College fall back on a political defense. In a pure popular-vote system, they warn that candidates would pay no attention to the least populous states. Nowadays, however, with most states well defined as either Democratic blue or Republican red, candidates devote most of their time and resources to only a dozen or so “battleground states.” Today, every Republican voter in California or Rhode Island counts for nothing, just like every Democratic voter in Texas or Wyoming.
      Supporters also argue, in effect, that the system works, almost all the time. The popular-vote winner has been denied the presidency only five times in the 54 elections since ratification of the Twelfth Amendment, including most recently Al Gore in 2000 and Hillary Clinton in 2016. A 9 percent failure rate is shy of an A-plus grade. And of the popular-vote-loser presidents in the 19th century, none is viewed as having been particularly successful in office: John Quincy Adams in 1824, Rutherford Hayes in 1876, and Benjamin Harrison in 1888.
      It would be quite a stretch for the Supreme Court to rule the Electoral College unconstitutional. But it was a stretch for the court to rule legislative and congressional malapportionment unconstitutional in the 1960s. The country is better off for the court’s decision to wade into what Justice Felix Frankfurter had previously called “the political thicket.”
      Malapportioned legislatures could not be expected to remedy the defect, so the Supreme Court stepped in when petitioned by disadvantaged voters from, among others, my home state of Tennessee. As a remedy, the court did not void elections. It only required legislatures to redraw districts and to hold subsequent elections according to the redrawn districts.
     If petitioned by undercounted voters in populous states, the court similarly need not nullify the results of a presidential election to get rid of the Electoral College. It need only require that a popular-vote system be established by the time of the next. Voters of underweighted states could file suit now and satisfy standing under the doctrine that their claimed injury is “capable of repetition but evading review.”
      The 15 states with five or fewer electoral votes — roughly half of them red and half blue — would be enough to prevent the three-fourths majority needed to adopt a constitutional amendment for a popular-vote system. A dozen or so states have signed on to the National Popular Vote Compact as a way to circumvent the Electoral College by pledging to cast their electoral votes for the popular-vote winner if joined by states with an electoral majority. Under the Supreme Court’s 1952 decision, however, the compact would be unenforceable.
      The U.S. Constitution has been a model for emerging democracies, but in more than 200 years no country has followed the Framers’ model for choosing its chief executive. The Constitution envisioned a system of self-government and, over time, its letter and spirit have been interpreted as embodying political equality as part of that system.
      The court has recognized in other contexts that the meaning of the Constitution can change with changing times. The Framers “knew times can blind us to certain truths and later generations can see that laws once thought necessary and proper in fact serve only to oppress,” Justice Anthony M. Kennedy wrote in nullifying anti-sodomy laws in Lawrence v. Texas (2003). “As the Constitution endures, persons in every generation can invoke its principles in their own search for greater freedom.”

Sunday, December 11, 2016

Court: No Insider Trading for Friends, Family

      Supreme Court justices routinely caution against drawing any conclusions about the court's views when it declines to review a lower court decision at the behest of the losing side in the case. Even so, the advocates and experts worried about insider trading felt a frisson of disappointment a year ago when the court declined to hear the government's appeal of a decision by the federal appeals court in New York making it harder to prosecute those cases.
      The disappointment hardened into anxiety a few months later when the court agreed to hear an appeal in a California case by a defendant who had cited the New York decision in an unsuccessful effort to overturn his conviction. Court watchers saw the decision to hear the case, Salman v. United States, as an indication that justices across the ideological spectrum might want to narrow the expansive reading of the broadly worded insider trading laws.
      For insider trading hawks, however, the story has a happy ending. In a unanimous decision last week [Dec. 6], the court held that it is a crime to trade on nonpublic information passed on by an insider relative or friend even if the so-called "tipper" gets no money, nothing but good will, for the leak. The ruling upheld the conviction of Bassam Salman, who made more than $1.5 million in profits by trading on the basis of tips about pending health care mergers and acquisitions passed on by his brother-in-law, an investment banker at Citigroup in San Francisco.
      In its decision in the New York case, the Second U.S. Circuit Court of Appeals had ruled that insider trading was not illegal unless the tipper received "a potential gain . . . of a pecuniary or similarly valuable nature." The hedge fund manager defendants in United States v. Newman had picked up tips from loose-lipped Wall Street bankers, who leaked valuable tips about future earnings reports from high-tech companies and were never prosecuted themselves.
      The prosecutors never established the bankers' motives for the leaks. Perhaps they felt a sense of self-importance as they showed they were in the know. Or maybe they even hoped for some kind of payback, in good will or maybe in U.S. currency. Under the Second Circuit's decision, however, they were not criminals and neither were the "tippees" who used the information to outsmart the general trading public.
      The New York case was brought by the office of U.S. Attorney Preet Bahrara, the prosecutorial scourge of Wall Street who reportedly has agreed to remain in office under the next administration. The Second Circuit said that Bahrara had prosecuted the hedge fund managers under "a doctrinal novelty," but in its decision last week the Supreme Court specifically said that Newman was "inconsistent" with the high court's underlying precedent.
      Admittedly, the court's foundational decision in Dirks v. Securities and Exchange Commission (1983) is less than crystal-clear. Insider trading liability attaches, the court held, only if the tipper receives "a personal benefit" from breaching a fiduciary duty to keep information confidential. The petitioner in that case, investment broker Raymond Dirks, won a reversal of his censure by the SEC for telling institutional investors about apparent fraud by a big insurance company.
      In the new decision, the Supreme Court reaffirms Dirks but without adding much by way of clarity. "Dirks makes clear that a tipper breaches a fiduciary duty by making a gift of confidential information to 'a trading relative,'" Justice Samuel A. Alito Jr. wrote in the 12-page opinion upholding the Ninth Circuit's decision to affirm Salman's convictions.
      The crime in this case started innocently enough. Maher Kara followed the health care industry for Citigroup and started sharing information about the industry with his older brother Mounir Kara when their father was battling cancer. One thing led to another: Mounir (known as Michael) started trading on the information and he then started feeding the information to Salman, a friend who eventually married Maher's sister.
      Maher Kara eventually figured out that his brother and Salman were trading on the information, but he did not stop the leaks. Eventually, both Kara brothers pleaded guilty to insider trading and testified at Salman's 2013 trial, where he was convicted on multiple counts and sentenced to three years' imprisonment and $730,000 in restitution.
      In New York, federal prosecutor Bharara expressed approval of the new decision. “The court stood up for common sense and affirmed what we have been arguing from the outset — that the law absolutely prohibits insiders from advantaging their friends and relatives at the expense of the trading public,” Bharara said in a statement emailed to news media. “Today’s decision is a victory for fair markets and those who believe that the system should not be rigged.”
      Interestingly, the court heard from an array of groups on Salman's side and only two backing the government about the harm to the public from insider trading. In its amicus brief, the libertarian Cato Institute argued that the "personal benefit" theory is "vague" and "unpredictable" and that it actually "chills beneficial economic activity" by leaving insiders uncertain about the legality of disclosing market-relevant information.
      Alito's spare opinion rehearses none of that debate. But the court deserves credit for reaffirming a sensible rule, albeit difficult to enforce, to limit insiders' ability to rig the market for the benefit of friends and family.

Saturday, December 3, 2016

Court Set to Overturn Texas Death Penalty Cases

      Texas leads the nation in executions by a country mile, but the state seems on a path to seeing two of its death penalty cases reversed by the Supreme Court following separate arguments in the first two months of the court's new term. The blatant errors in the two cases highlight again the dismal record by Texas state courts and the federal appeals court for Texas in protecting constitutional rights in cases that call for additional not less scrutiny on appellate review.
      Bobby Moore appears likely after arguments last week [Nov. 29] to get a new chance to be spared execution under the Supreme Court's decision in 2002 prohibiting the death penalty for defendants with severe intellectual disabilities. In upholding the sentence, the Texas Court of Criminal Appeals relied on an old and now disfavored definition of what used to be called "mental retardation."
      As Justice Anthony M. Kennedy aptly remarked during the argument in Moore v. Texas, the state's approach seems designed to limit intellectual disability claims in the face of "an almost uniform medical consensus" on a somewhat broader definition. Texas Solicitor General Scott Keller tried to disagree, but Kennedy and Justice Elena Kagan both rejected his defense. "Justice Kennedy is right about how they operate," Kagan said, "and how they were intended to operate."
      In earlier arguments [Oct. 5], Duane Buck appeared likely in Buck v. Stephens to win a new chance to be spared execution by proving that he was prejudiced by testimony from a supposed expert linking black defendants to high degrees of "dangerousness." It was Buck's own defense lawyer who put on the testimony, prompting the law-enforcement minded Justice Samuel A. Alito Jr. to describe the course of the penalty-phase hearing as "indefensible."
      Buck's lawyer, Jerry Guerinot, has had 20 of his capital case defendants sentenced to death — a record highlighted in a New York Times profile with the headline "A Lawyer Best Known for Losing Capital Cases." In a separate case, the Texas attorney general's office has confessed error in use of the expert's race-as-dangerousness study. Even so, the Fifth U.S. Circuit Court of Appeals, which has jurisdiction over Texas and two other southern death penalty states, refused Buck the "certificate of appealability" needed to challenge the death sentence in a federal habeas corpus proceeding.
      At the Supreme Court, Kagan noted statistics from the brief by Buck's new lawyer, Christina Swarms of the NAACP Legal Defense Fund, that the Fifth Circuit denies permission to appeal in capital cases about 60 percent. By contrast, the Eleventh Circuit, which has jurisdiction over Florida and two other death penalty states in the South, denies permission about 6 percent of the time. "It does suggest," Kagan said, that "one of these two circuits is doing something wrong."
      With lenient judicial review like that, it is perhaps not surprising that Texas has been the national leader in executions since capital punishment was reinstituted under the Supreme Court's decision in 1976. The Death Penalty Information Center counts 538 executions in Texas during the period, more than one-third of the total number of 1,440 throughout the United States.
      The pace of executions is slowing nationwide and in Texas too. The death penalty "is withering on the vine," Stephen Shapiro, outgoing national legal director of the American Civil Liberties Union, remarked at the Supreme Court last week. As the number falls, Texas's proportionate share has increased. The Lone Star State's 13 executions in 2015 were almost half the national total of 28. For 2016, Texas's seven executions so far are again more than one-third the national total of 18.
      The two cases at the Supreme Court differ in terms of inviting extra-legal sympathy for the defendants. Guilt is undisputed in either case. Buck's offense is grisly and premeditated, Moore's less so on both counts.
      Buck, who is African American, was convicted of murder in the 1995 killing of his former girlfriend and a new friend of hers while her children watched. However gruesome the circumstances, a capital case with a black defendant demands extra attention to substantive and procedural rights in the light of the death penalty's long history of racial discrimination in the United States.
      Moore was convicted, in 1980 at age 21, of murder in the killing of a store clerk during a botched robbery in Houston. Representing Moore at the Supreme Court, the prominent Washington attorney Clifford Sloan told the justices that Moore's intellectual limitations had been evident since the age of 13 when he was unable to understand "the days of the week, the months of the year, the seasons, how to tell time, the principle that subtraction is the opposite of addition."
      The Supreme Court left it up to the states to define intellectual disability in its decision in Atkins v. Virginia (2002) prohibiting the execution of what were then called "mentally retarded" defendants. But in 2014 the Court ruled in Hall v. Florida that states cannot use a bright-line IQ test threshold in determining intellectual disability in capital cases.
      The standards now adopted by professional associations look separately at deficits in intellectual capacity and in what is called "adaptive behavior" -- roughly, the ability to get along in day-to-day life. In Moore's case, however, Texas applied the state's old standards that allowed disregarding intellectual deficits in the absence of adaptive deficits. Keller insisted that Texas's approach was "well within the national consensus," but Kennedy and the liberal justices appeared from the arguments ready to tell Texas to get with the times.