Legal News for Fri 6/14 - Big Law Comes to Boston, New FERC Commissioners, Senate Bill Creating New Judgeships and Visa/Mastercard Settlement in Question

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This Day in Legal History: Flag Statutes in Public Schools

On this day in legal history, June 14, 1943, the US Supreme Court issued a landmark decision in West Virginia State Board of Education v. Barnette, profoundly impacting the rights of individuals in public schools. The case arose when Jehovah's Witnesses challenged a West Virginia mandate requiring students to salute the American flag and recite the Pledge of Allegiance, actions contrary to their religious convictions. The Court ruled that forcing students to participate in patriotic rituals violated their First Amendment rights to freedom of speech and freedom of religion.

Justice Robert H. Jackson, writing for the majority, asserted that compelling students to salute the flag was a form of coerced speech that infringed upon their individual liberties. The decision overturned the 1940 ruling in Minersville School District v. Gobitis, which had upheld mandatory flag salutes. Jackson famously stated, "If there is any fixed star in our constitutional constellation, it is that no official... can prescribe what shall be orthodox in politics, nationalism, religion, or other matters of opinion."

This ruling reinforced the principle that the government cannot force individuals to express beliefs they do not hold. It underscored the protection of individual freedoms against state-imposed conformity, significantly shaping the interpretation of First Amendment rights in the educational context. The Barnette decision remains a cornerstone in American constitutional law, symbolizing the enduring protection of individual liberties in the face of governmental authority.

Large national law firms are increasingly establishing offices in Boston, potentially overshadowing local firms that have operated regionally for decades. This year, Simpson Thacher & Bartlett, Paul Hastings, and Blank Rome announced new Boston offices, while Covington & Burling, Arnold & Porter, and Akin Gump Strauss Hauer & Feld did so last year.

In a notable move, Goodwin Procter recently recruited a five-partner tech and life sciences team from Cooley in Boston, signaling a consolidation trend in legal services within these sectors. The health and energy industries have remained strong in a sluggish deals market, bolstered by the financial strength of health care giants and incentives from the Inflation Reduction Act.

The number of law firm openings in Boston has surged over the past decade, with over 40 firms establishing a presence since 2016. This influx includes regulatory-focused firms like Covington and UK-based Magic Circle firms such as Allen & Overy. As large firms move in, regional firms face the risk of losing talent and clients.

Despite these developments, the efforts of new Big Law entrants in Boston remain in their early stages, with firms like Simpson Thacher planning deliberate growth to tap into the city's talent pool.

Big Law Firms Eye Boston to Tap Hot Tech, Health Care Markets

The Federal Energy Regulatory Commission (FERC) has three new commissioners, which could influence the review process for natural gas pipelines and liquefied natural gas (LNG) terminals. Industry advocates argue these projects are essential to meet rising electricity demand, while environmental groups push for rejection due to the long-term climate impacts of fossil fuels. The newly confirmed commissioners—Democrats David Rosner and Judy Chang, and Republican Lindsay See—join FERC at a critical time. With Commissioner Allison Clements' upcoming departure, FERC will regain a 3-2 Democratic majority for the first time in 18 months.

Historically, FERC's decisions on natural gas have been contentious, with a 2022 policy to scrutinize gas projects leading to the end of former Chairman Richard Glick's tenure. The new commissioners have indicated a focus on gas infrastructure, despite past environmental concerns. Chang, for example, moderated her previous stance against new gas pipelines during her confirmation hearing.

FERC's decisions are crucial amid growing electricity demands, driven by factors like artificial intelligence and increased manufacturing. Natural gas consumption is at record highs, and new power generation, particularly from gas, is necessary to meet future needs. However, permitting reviews and litigation have slowed the expansion of pipeline capacity. Industry experts stress the need for regulatory certainty to align infrastructure with demand, a sentiment echoed by the Interstate Natural Gas Association of America. The new FERC commissioners face the challenge of balancing these competing interests as they begin their terms.

Divisive Gas Reviews Pose Early Test for New FERC Commissioners

On June 13, the U.S. Senate Judiciary Committee advanced bipartisan legislation to create 66 new judgeships in federal district courts across states like California, Delaware, and Texas. This marks the first major judiciary expansion in over three decades. The committee's unanimous 20-0 vote moves the JUDGES Act to the full Senate for consideration. If enacted, it will be the first comprehensive authorization of new judges since 1990, addressing longstanding requests to manage rising caseloads in 25 district courts nationwide.

The last time new judgeships were created was in 2003, but efforts to expand the federal bench have since stalled due to partisan concerns. The current bill mitigates these concerns by incrementally adding the new judicial seats over ten years, starting in January 2025, after the 2024 presidential election. This phased approach aims to prevent any single party or president from gaining an advantage.

Democratic Senator Chris Coons, a co-sponsor of the bill, emphasized the urgency of expanding the federal bench to address the growing backlog of court filings since 1990. The JUDGES Act aligns with recommendations from the Judicial Conference, seeking to add judges in districts facing a "genuine crisis of workload."

U.S. District Judge Robert Conrad expressed the judiciary's appreciation for the Senate's efforts. The judiciary currently has 677 authorized district court seats and 10 temporary ones, which another Senate-passed bill aims to make permanent.

Initially opposed to adding more judges, Republican Senator Chuck Grassley supported the bill after amendments spread the additions over time. The JUDGES Act now plans to introduce the 66 new judgeships in five stages through 2035, with three temporary judgeships in Oklahoma.

A companion bill is pending in the Republican-led House of Representatives, backed by Representative Darrell Issa, chair of the House Judiciary Committee’s panel on courts.

US Senate panel advances bipartisan bill to create new judgeships | Reuters

The proposed $30 billion antitrust settlement between Visa and Mastercard to limit credit and debit card fees for merchants is in jeopardy. U.S. District Judge Margo Brodie in Brooklyn indicated she is likely to reject the settlement, citing her intent to write an opinion detailing her decision. Both Visa and Mastercard expressed disappointment, describing the settlement as a fair and appropriate resolution to the nearly 19-year-old litigation.

Announced on March 26, the settlement aimed to address most claims from nationwide litigation, with small businesses making up over 90% of the settling merchants. Businesses have long argued that Visa and Mastercard's swipe fees, which totaled $172 billion in 2023, are excessive and that the card networks illegally prevent them from steering customers to cheaper payment methods. The settlement proposed reducing swipe fees by at least 0.04 percentage points for three years, capping rates for five years, and removing anti-steering provisions.

However, objectors, including the National Retail Federation, criticized the settlement as insufficient, arguing that it would still allow Visa and Mastercard to control swipe fees and prevent future claims by merchants. The case, known as In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, is being heard in the U.S. District Court for the Eastern District of New York.

Visa, Mastercard $30 billion fee settlement in peril | Reuters

This week’s closing theme is by John David Davis.

John David Davis (22 October 1867 – 20 November 1942), often known as J. D. Davis, was an English composer born in Edgbaston, near Birmingham. Although he was born into a musical family, Davis was initially sent to Frankfurt to prepare for a commercial career. However, his passion for music led him to study under Hans von Bülow. Davis completed his education in Germany before furthering his studies in Brussels with Léopold Wallner, Arthur De Greef, and Maurice Kufferath.

Upon returning to Birmingham in 1889, Davis began teaching music, notably at the Birmingham and Midland Institute from 1893 to 1904. In 1905, he joined the Guildhall School of Music as a professor of harmony and composition and also served as Professor of Solfège at the International Conservatoire in London.

In 1919, Davis married Helen Winifred Juta, the daughter of South African judge Henry Juta. The couple lived in Earls Court, London, before moving to Lisbon in 1936. Davis passed away in Estoril, Portugal, in 1942, and his wife later returned to South Africa, where she died in 1952.

This week's closing theme is John David Davis' evocative piece, "Summer's Eve at Cookham Lock, Op. 50." Composed in 1916 for the London String Quartet, this work captures the serene beauty of a summer evening at Cookham Lock. Known for its lyrical quality and gentle atmosphere, "Summer's Eve at Cookham Lock" offers a tranquil auditory experience.

The piece, also known as an Idyl for string quartet, demonstrates Davis' ability to paint a vivid picture through music. Its delicate melodies and harmonies reflect the calm and reflective mood of a summer evening by the water. This composition stands as a testament to Davis' skill in creating evocative and picturesque musical landscapes, making it a fitting and soothing choice for this week's closing theme. Enjoy.

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