Matters of Time - SCOTUS Today

The U.S. Supreme Court decided two cases yesterday, in each of which timing played a decisive role in the outcome. These cases did not produce the unanimity that has characterized most of the Court’s decisions so far this term. However, the divisions, while reflective of ideological differences among the Justices, are expressed with intellectual honesty and recognition of consequences. One of them, a copyright case, is of particular relevance to litigators involved, not just with copyright issues, but in many areas of the law concerning how the Court will interpret and apply statutory deadlines.

While the opinions in the case are lengthier than one might imagine, given the ostensible simplicity of the issue presented, Culley v. Marshall provides an interesting example of due process analytics. The two petitioners, Halima Culley and Lena Sutton, each exercised questionable judgment in lending their cars to people who were stopped by Alabama police officers for violating drug possession or trafficking laws. Each of the cars was seized under an Alabama civil forfeiture law that permitted the seizure of a car “incident to an arrest” so long as the state then “promptly” initiated a forfeiture case. That was done in less than two weeks following the seizure in each case. Culley and Sutton each filed federal class actions under 42 U. S. C. §1983, claiming that state officials violated their due process rights by retaining their cars during the forfeiture process without holding immediate preliminary hearings. Affirming the U.S. Court of Appeals for the Eleventh Circuit, the Supreme Court, per Justice Kavanaugh, with the Chief Justice and Justices Thomas, Alito, Gorsuch, and Barrett joining, held that in civil forfeiture cases involving personal property, the Due Process Clause requires a timely forfeiture hearing but does not require the separate preliminary hearing that petitioners had sought. While due process ordinarily requires a state to provide notice and a hearing before seizing real property, a state may immediately seize personal property subject to civil forfeiture when such property, such as a car, could be removed, destroyed, or concealed before a hearing could take place. Applying two precedential forfeiture cases, United States v. Von Neumann, 474 U. S. 242 (1974) and United States v. $8,850, 461 U. S. 553 (1983), the Court held that it is “crystal clear” that due process does not require a separate preliminary hearing to determine whether seized personal property may be retained pending the ultimate forfeiture hearing. However, a post-seizure delay “may become so prolonged that the dispossessed property owner has been deprived of a meaningful hearing at a meaningful time.” It is sufficient that $8,850 has prescribed various factors for courts to consider in assessing whether a forfeiture hearing is timely. In so holding, the Court noted that, starting in the Founding Era, most forfeiture statutes do not require preliminary hearings and that doing so would create massive litigation bottlenecks. The Court also distinguished between real property that is static and personal property, such as a car, that can be hidden or destroyed.

A dissenting opinion written by Justice Sotomayor and joined by Justices Kagan and Jackson focuses on financial and other incentives that a police department might have to hold on to seized cars for long periods before a hearing to determine ownership takes place. The dissenters would have had the Court decide only the nature of the due process test that governs and leave it to lower courts to apply to varying forfeiture regimes. Like former New York Yankee Manager Billy Martin in an old beer commercial, Justice Gorsuch, writing a separate concurring opinion, feels strongly both ways. He agrees with the majority that due process requires a prompt hearing in civil forfeiture cases, but that no legal authority requires the specific type of hearing that the petitioners propose. However, he goes on for 10 and a half pages, raising questions about the abuses that current civil forfeiture practices might impose. He leaves their resolution for a hypothetical future case in which, on a fully developed record, the Court “might begin the task of assessing how well the profound changes in civil forfeiture practices we have witnessed in recent decades comport with the Constitution’s enduring guarantee” of due process.

The copyright case I mentioned at the outset of this post, Warner Chappell Music, Inc. v. Nealy, involves the interpretation of the provision of the Copyright Act instructing that a plaintiff must file suit “within three years after [an infringement claim] accrued.” 17 U. S. C. §507(b). But does that limitations provision mean that a copyright claim “accrue[s]” when “an infringing act occurs,” or does it mean that a claim accrues when “the plaintiff discovers, or with due diligence should have discovered,” the infringing act? Justice Kagan delivered the opinion of the Court, joined by the Chief Justice and Justices Sotomayor, Kavanaugh, Barrett, and Jackson, holding that the Copyright Act entitles a copyright owner to obtain monetary relief for any timely infringement claim, no matter when the infringement occurred. The Copyright Act’s statute of limitations establishes a three-year period for filing suit, which begins to run when a claim accrues. The Court assumes, without actually deciding, that accrual means “upon discovery.” This conclusion is premised upon the Court’s inability to find any separate three-year limit on recovering damages in the statute’s remedial sections.

Justice Gorsuch dissented, and Justices Thomas and Alito joined him, suggesting that the so-called “incident of injury rule” should apply rather than the discovery rule that, according to claimed historical practices, should apply only “in cases of fraud or concealment.” Besides the interesting division of the justices, which finds the Chief Justice and Justices Kavanaugh and Barrett aligned with the three jurisprudential liberals, the dueling decisions also provide an interesting conflict as to the reach of judicial decision-making. Justice Gorsuch implies that the Court wasted its time deciding a case in which the parties did not question the application of the discovery rule, only how it should work. He and his allies would have dismissed cert. as improvidently granted and left the question of whether the Copyright Act actually authorizes the discovery rule. With a firm majority disagreeing with that suggestion, the rest of us, especially on the defense side, are faced with the fact that absent clear statutory provisions triggering claims from the time of their occurrence, it is likely that the time of discovery will govern a statute of limitations.