- The Washington Times - Monday, July 28, 2008


Members of a Senate committee criticized the Supreme Court last week for a series of rulings they say show favoritism toward big business.

Some senators said the court trampled the little guys to help corporations protect their assets.

Senate Judiciary Committee Chairman Patrick J. Leahy, Vermont Democrat, accused the Supreme Court of substituting its own will for the intent of the laws approved by Congress.

“I’m more concerned about the rights of people,” Mr. Leahy said a during a discussion of the Exxon Shipping Co. v. Baker case.

The Supreme Court ruled that the punitive damages paid to about 32,000 plaintiffs could be no more than the compensatory damages, which refers to provable injuries such as property damage or monetary loss. Punitive damages are designed to punish wrongdoers.

The court’s decision reduced the amount of punitive damages Exxon Mobil needed to pay for the 1989 Exxon Valdez oil spill in Alaska’s Prince William Sound from $2.5 billion to $507 million.

The U.S. Chamber of Commerce praised the decision, saying it protected corporations against runaway juries and provided a predictable formula businesses can use to determine their potential litigation costs.

Mr. Leahy panned the decision at a hearing last week.

“If Congress had wanted to cap punitive damages for disasters that impact thousands of Americans, it could have but it did not,” Mr. Leahy said.

The result of the Supreme Court’s pro-business tilt is that during a time of economic turmoil, “Instead of protecting [Americans] from financial injuries, they’ve done just the opposite,” he said.

Osa Schultz, an Alaska fisherman whose business was hurt by the oil spill, said fishermen from the Prince William Sound area are likely to recover no more than 45 percent of their losses because of the Supreme Court’s limit on punitive damages.

“Punitive damages are the only means by which citizens can punish a corporation for wrongdoing,” she said.

Business also scored a big victory with the Supreme Court’s January decision in Stoneridge Investment Partners v. Scientific-Atlanta, which limited the right of corporate investors to sue when they fall prey to fraud.

A group of investors accused cable TV provider Charter Communications of mishandling their money under a securities-fraud scheme. The value of their stock plummeted when the fraud became public.

The investors sued Charter Communications’ business partners, who they said were accomplices in the fraud.

The Supreme Court said fraud claims are allowed against parties that committed the fraud, not their business partners.

In Circuit City Stores Inc. v. Adams, the Supreme Court expanded the discretion of businesses to resolve disputes with employees through arbitration.

The Federal Arbitration Act can override conflicting state law, the court said.

Sen. Arlen Specter, Pennsylvania Republican, was less strident in his criticism of the Supreme Court, saying the recent rulings left Congress opportunities to revise its laws.

He made an exception for the case of Ledbetter v. Goodyear Tire & Rubber Co., a gender-based employment-discrimination case.

Lilly Ledbetter, a Goodyear Tire employee, sued the company after finding she had been paid less than male workers doing the same job for the past 20 years.

Paying women less than men for the same work violates the Equal Pay Act of 1963 and other federal laws.

The Supreme Court said Ms. Ledbetter waited too long to file her claim. She needed to file her wage-discrimination complaint within 180 days after the discrimination started, the court said.

Mr. Specter disagreed.

“How can you pursue a claim if you don’t know that the claim even existed?” Mr. Specter said.

He urged Congress to pass legislation that would allow workers to be compensated for their claims despite the 180-day statute of limitations.

Above the Law runs on Mondays. Call Tom Ramstack at 202/636-3180 or e-mail [email protected]



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