Matthew Vadum articles in The Epoch Times, December 2018

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Supreme Court Considers Who Bears Responsibility for Security Fraud
December 3, 2018 Updated: December 3, 2018

An investment banker who sent deceptive emails dramatically overstating the financial health of a failing clean energy company shouldn’t be held responsible for securities fraud because he was only following his supervisor’s directions, the man’s attorney told a skeptical Supreme Court.

U.S. securities laws forbid those offering securities for sale from making false statements or participating in fraudulent schemes. Whether a person who merely passes the bad information along is legally liable is at issue in this case.

The company, Waste2Energy Holdings Inc. of Neptune Beach, Florida, founded in 2007, went out of business in 2013 after filing for Chapter 11 bankruptcy. The company had hoped to develop technology to convert waste into energy but failed to do so.

In 2009 Francis V. Lorenzo, then the director of investment banking at the brokerage Charles Vista LLC, emailed prospective investors offering for sale $15 million in debentures secured only by W2E’s earning capacity.

The emails indicated that W2E had $10 million in assets and purchase orders north of $40 million, and that the brokerage was willing to raise money to repay investors if needed.

But at the time the emails were sent, the company had already acknowledged that an audit had determined its assets were worth much less than $1 million.

Lorenzo’s boss and the brokers settled the claims the U.S. Securities and Exchange Commission (SEC) brought but Lorenzo refused. An SEC administrative law judge found Lorenzo’s superior drafted the emails but that Lorenzo had nonetheless broken the law by sending them because they contained false information about W2E’s financial situation.

The SEC banished Lorenzo from the securities industry for life and imposed a $15,000 civil penalty.

A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit ruled against Lorenzo in 2017, finding that he participated in a scheme to defraud investors by sending the misleading emails even though he was not deemed to have made the untrue statements himself.

Lorenzo disagreed with the circuit court and the Supreme Court decided June 18 to hear his appeal. He argues that at most he may have aided and abetted a fraudulent scheme as a “secondary” violator of securities laws.

Borrowing language from the Supreme Court’s ruling in the 2011 case, Janus Capital Group Inc. v. First Derivative Traders, Lorenzo argued that because he did not have “ultimate authority over the statement, including its content and whether and how to communicate it,” he cannot be held liable under Rule 10-5(b) of the Securities Exchange Act. The rule forbids fraudulent schemes or devices, making false statements, and engaging in fraud that harms investors.

Justice Brett Kavanaugh, who sat on the circuit court panel at the time, dissented from its majority opinion, writing that Lorenzo hadn’t violated securities laws. “How could [petitioner] have intentionally deceived the clients when he did not draft the emails, did not think about the contents of the emails, and sent the emails only at his boss’s direction?”

Kavanaugh recused himself from the Supreme Court case, leaving the other eight justices to participate in oral arguments Dec. 3.

Justices Have Doubts
During those oral arguments, Lorenzo’s attorney, Robert Heim, said that sending the email was not an inherently deceptive act. Justice Neil Gorsuch appeared to agree that Lorenzo was not the author of the false statements in the emails.

But Justices Ruth Bader Ginsburg, Samuel Alito, and Sonia Sotomayor seemed to disagree with Heim.

Ginsburg asked Heim why it wasn’t “inherently deceptive to send a succession of untruths?”

“Lorenzo is essentially a conduit,” Heim replied. “He’s somebody that’s transmitting statements … on behalf of another … simply sending an e-mail is not enough to transform Frank Lorenzo into a primary violator from, perhaps, somebody who gave substantial assistance.

The language of the statutes and the rules make “a clear distinction between statements and … conduct.”

Alito asked why Lorenzo’s behavior wouldn’t “fall squarely” within the language of the rule used by the SEC.

Sotomayor was just as blunt, telling Heim: “I’m having a problem from the beginning. Once you concede … that you’re not challenging that your client acted with an intent to deceive or defraud, that you aren’t challenging the D.C. Circuit’s conclusion to that effect? Is that correct?”

Heim replied, “Yes, Your Honor.”

Sotomayor continued: “I don’t understand, once you concede that mental state, and he has the act of putting together the email and encouraging customers to call him with questions, not to call his boss with questions, how could that standing alone give away your case?

“That makes him both the maker of a false statement, but it’s also engaging in an act, practice, or course of conduct which operates or would operate as a fraud or deceit.”

The Trump administration argues the treatment Lorenzo received at the hands of the SEC was just.

“I don’t think you’re likely to see a … more egregious fraud than this,” Christopher Michel, assistant to the solicitor general, told the justices.


Supreme Court Dismisses Environmentalists’ Challenge to Border Wall
December 4, 2018 Updated: December 4, 2018

The Supreme Court summarily rejected a legal challenge from activists who claimed that President Donald Trump’s proposed southern border wall ran afoul of environmental laws, clearing away a potential obstacle that might have prevented the administration from moving ahead with construction on the project.

The Dec. 3 denial of the activists’ petition for certiorari was environmentalists’ second loss at the Supreme Court in as many weeks. The new ruling came days after the court unanimously rebuffed environmental regulators and activists in a case involving the endangered dusky gopher frog; in that case, the court found that the federal government overreached by limiting the development of private land in Louisiana to help save an amphibian that doesn’t actually live there.

The ruling is also a significant victory for Trump, who campaigned on beefing up immigration law enforcement and constructing a wall on the nation’s multi-state border with Mexico. Years ago, Congress approved legislation authorizing construction of the wall but has yet to actually appropriate funding for it. Congress has appropriated limited funding for fencing and other barriers along the border.

Trump took to Twitter Dec. 4 to urge Congress to approve wall funding:

“Could somebody please explain to the Democrats (we need their votes) that our Country losses [sic] 250 Billion Dollars a year on illegal immigration, not including the terrible drug flow. Top Border Security, including a Wall, is $25 Billion. Pays for itself in two months. Get it done!”

The court decision comes at a time when the nation’s immigration system and porous borders are constantly in the headlines. Televised images of members of Central American caravans defiantly scaling border fencing to unlawfully enter the country have enraged many Americans. Trump has deployed about 6,000 U.S. troops to the border with Mexico.

The decision to not consider an appeal of the ruling by U.S. District Judge Gonzalo Curiel of the Southern District of California earlier this year by the Center for Biological Diversity, Animal Legal Defense Fund, and Defenders of Wildlife helps to clear the way for the administration to move forward with building a border wall, assuming Congress appropriates funding for the project. Curiel, coincidentally, is the same judge Trump previously criticized for his handling of a class-action lawsuit involving the now-defunct Trump University.

But it’s far from certain that lawmakers will approve funding for the wall. Trump has threatened to shut down the federal government if Congress fails to ante up $5 billion for the initial phase of wall construction, for a project expected to cost $25 billion.

Current funding for the government runs out Dec. 7. House Majority Whip Steve Scalise (R-La.) told Fox News Channel Dec. 4 that lawmakers have agreed to fund the government for a two-week period.

“We’ve worked that out. And this fight’s going to continue on. And clearly, what we’re battling over is to make sure that we can fund our border-security properly, build the wall, and give President Trump the money he needs to keep America safe.”

The Supreme Court justices declined without comment the request to review the ruling by Curiel, who dismissed the activists’ claim that the Trump administration had gone forward with preliminary phases of the project without complying with environmental laws.

Activists alleged in court filings that building the wall would have an adverse impact on the snowy plover and California gnatcatcher birds, and on other species, including the fairy shrimp, Quino checkerspot butterfly, and plant life such as the Tecate cypress and Otay Mesa mint.

Brian Segee, a lawyer for the Center for Biological Diversity, told Reuters he was disappointed the court turned down his group’s appeal of Curiel’s decision.

“Trump has abused his power to wreak havoc along the border to score political points,” Segee said. “He’s illegally sweeping aside bedrock environmental and public-health laws. We’ll continue to fight Trump’s dangerous wall in the courts and in Congress.”


Exit Polls Suggest GOP Did Not Gain Ground With Black and Latino Voters
December 5, 2018 Updated: December 5, 2018

President Donald Trump and the GOP have paid significant attention to attracting black and Latino voters, but so far these efforts have not led to new votes, according to exit poll data from elections last month.

Although pre-election numbers showed Trump with a rising approval rating among blacks, the “black wave” of black American voters shunning their traditional preference for the Democratic Party and moving into the Republican column, as predicted by some pundits and GOP strategists, failed to materialize.

Recording artist Kanye West’s activism on behalf of the president in the fall seemed to give Trump and Republicans a boost. The rapper wore a red “Make America Great Again” baseball cap as he laid out an informal anti-Democratic Party manifesto on “Saturday Night Live” on Sept. 29. “The blacks weren’t always Democrats,” West said.

Republicans were also buoyed by a Rasmussen Reports daily tracking poll in August that pegged the president’s approval rating among black Americans at 36 percent, which is almost double the 19 percent he had a year before. A poll released around the same time by the liberal National Association for the Advancement of Colored People showed that 21 percent of registered black voters approved of Trump’s job performance.

But those approval numbers didn’t carry over to the ballot box.

Black Americans, who made up 11 percent of the overall electorate, favored Democrats over Republicans by a margin of 90 percent to 9 percent, according to exit poll data published by CNN based on respondents who voted in 2018 House of Representatives contests.

Republicans had performed slightly better in 2016 House races. In that election, blacks were 12 percent of the electorate. Exit poll data from that year indicate blacks favored Democrats by a margin of 88 percent compared to 10 percent for Republicans.

In the 2016 presidential race, blacks favored Democrat Hillary Clinton over Trump by 89 percent to 8 percent.

In the 2018 election a month ago, whites comprised 72 percent of the electorate. Non-whites were 28 percent. Breaking down non-whites, 11 percent of the electorate was black, 11 percent was Latino, 3 percent was Asian, and 3 percent was in the “other” category.

Of whites, 54 percent voted Republican and 44 percent voted Democrat. Among non-whites, 76 percent voted Democrat and 22 percent voted Republican. Latinos favored Democrats (69 to 29 percent), as did Asians (77 to 23 percent), and “other” voters (54 to 42 percent).

Republicans lost ground on a nationwide basis with Latinos in 2018 compared to 2016.

This year, Republicans won 29 percent of the Latino vote compared to the Democrats’ 69 percent. In 2016 the GOP won 32 percent Latino support compared to Democrats’ 67 percent. In 2016 Trump captured 28 percent of Latino votes compared to Clinton’s 66 percent.

In select Senate races, voters generally followed the usual patterns: men favored Republicans, women favored Democrats, and minorities favored Democrats.

In Texas, where incumbent Sen. Ted Cruz, a Republican, barely beat back a vigorous, well-funded challenge by Democrat Beto O’Rourke, Cruz won the votes of men by 56 to 43 percent. O’Rourke was backed by women, 54 to 46 percent.

In that contest, 56 percent of voters were white, compared to 44 percent who were non-white. Whites opted for Cruz 66 to 34 percent, while non-whites went for O’Rourke 69 to 31 percent. Latinos, who constituted 26 percent of voters, went for O’Rourke 64 to 35 percent.

In the hard-fought contest for the U.S. Senate in Florida, the successful candidate, Republican Rick Scott, prevailed over incumbent Democrat Bill Nelson by 58 to 42 percent among men. Nelson won women 56 to 43 percent.

That electorate was 66 percent white and 34 percent non-white. Whites went for Scott over Nelson by 60 to 40 percent. Non-whites favored Nelson by 70 to 29 percent. Latinos were 15 percent of that electorate, compared to blacks at 13 percent, and “other” at 4 percent.

Latinos favored Nelson 54 to 45 percent. Blacks backed Nelson 90 to 10 percent. Respondents in the “other” category went for Nelson by 66 to 32 percent.

In another hard-fought race, this time for Florida governor, men broke for the victor, Republican Ron DeSantis over Democrat Andrew Gillum by 58 to 41 percent. Women favored Gillum over DeSantis by 55 to 43 percent.

Whites went for DeSantis over Gillum by 60 to 39 percent. Non-whites favored Gillum by 68 to 30 percent. Latinos went for Gill 54 to 44 percent. “Other” voters preferred Gillum 65 to 33 percent.

In the bitterly contested race for Georgia governor, Republicans came close to eliminating the gender gap. Men broke for the successful candidate, Republican Brian Kemp, over Democrat Stacey Abrams by 52 to 46 percent. Women favored Abrams over Kemp by 51 to 49 percent.

That electorate was 60 percent white and 40 percent non-white. Whites went for Kemp over Abrams by 74 to 25 percent. Non-whites favored Abrams by 84 to 15 percent. Blacks were 30 percent of that electorate, compared to Latinos at 5 percent, Asians at 2 percent, and “other” at 3 percent. Blacks and Latinos went for Abrams 93 to 6 percent and 62 to 37 percent, respectively.

In the Missouri Senate race, Republican victor Josh Hawley beat incumbent Democrat Claire McCaskill among men, 57 to 42 percent. Women preferred McCaskill 51 to 47 percent.

Whites, making up 84 percent of voters, favored Hawley 57 to 42 percent. Blacks, at 8 percent of the electorate, went for McCaskill 91 to 8 percent. Latinos, comprising 4 percent of voters, preferred McCaskill 53 to 44 percent.

In the Indiana Senate race, men favored the victor, Republican Mike Braun, 57 to 40 percent over incumbent Democrat Joe Donnelly. Women chose Donnelly over Braun by 49 to 46 percent.

Whites, making up 86 percent of voters, favored Braun 56 to 40 percent. Blacks, at 8 percent of the electorate, went for Donnelly 88 to 11 percent. Latinos, comprising 3 percent of voters, preferred Donnelly 71 to 22 percent.


Top Court Hears Double Jeopardy Case With Ramifications on Russia Probe
December 6, 2018 Updated: December 6, 2018

A lawyer for an Alabama man convicted of the same offense in state and federal courts urged the Supreme Court to rein in the federal government’s prosecutorial powers, in a double jeopardy case that could have ramifications for those affected by special counsel Robert Mueller’s ongoing Russia investigation.

Mueller’s shadow loomed large over the oral arguments in the case on Dec. 6, even though he wasn’t mentioned. The case has attracted interest because it could have an impact on Mueller’s ongoing investigation of former Trump campaign manager Paul Manafort and other Trump associates. Manafort entered guilty pleas to conspiracy charges unrelated to the Trump campaign or the 2016 election, and he has reportedly been cooperating with Mueller.

States may yet pursue indictments against Manafort and other individuals associated with the president. As of August 2017, Mueller had reportedly been collaborating with then-New York Attorney General Eric Schneiderman to prepare a case against Manafort. Trump could pardon Manafort and others, but his clemency authority covers federal, not state, offenses.

Trump has not ruled out a pardon for Manafort. “It was never discussed, but I wouldn’t take it off the table,” the president told the New York Post a week ago.

In the case before the Supreme Court, the petitioner, Terance Martez Gamble, was convicted of felony second-degree robbery in Mobile County, Alabama, in 2008, and on two counts of domestic violence five years later, according to a case preview by Alan Raphael of Loyola University Chicago School of Law. Both Alabama and federal law forbid convicted felons from possessing firearms. Gamble’s car was pulled over for a traffic violation in 2015. Police found a gun in his car.

Gamble pleaded guilty to a state-level charge of being a felon in possession of a firearm and completed a one-year prison term. Based on the same search and weapon that gave rise to state charges, during the prosecution the federal government charged him with possessing a gun while a felon. Before pursuing the indictment, the U.S. attorney obtained permission from the Department of Justice under something called the Petite Policy to bring the charge. The policy allows federal prosecutions after state convictions in certain circumstances.

Gamble argued the federal charge should be dismissed because he claimed it violated his Fifth Amendment right against being placed in legal jeopardy twice for the same crime. A U.S. district court threw out the motion citing the “separate sovereigns exception” to the Double Jeopardy Clause.

Since its ruling in Abbate v. United States in 1959, the Supreme Court has allowed “successive prosecutions by separate sovereigns, such as the federal and state governments, even though the subsequent charge would be barred if both were brought by the same government,” Raphael writes.

Gamble pleaded guilty to the federal charge and received a sentence of 46 months. The Atlanta-based U.S. Court of Appeals for the 11th Circuit upheld the federal conviction. On June 28, the Supreme Court agreed to hear Gamble’s appeal from that decision.

Gamble argues the separate sovereigns exception should be overruled because the language in the Double Jeopardy Clause makes no exceptions, and is contrary to the meaning intended by the framers, old English precedents, and legal writings from England and the early United States.

“The separate sovereigns exception to the Double Jeopardy Clause is inconsistent with the text and original meaning of the Double Jeopardy Clause,” Gamble’s attorney, Louis Chaiten of Cleveland, Ohio, told the justices.

“There is no dispute that the text of the clause was understood to incorporate English practice. And there was no practice of inter-sovereign successive prosecutions in all of English history or in American history for the first century of this republic after their framing.”

Justice Elena Kagan challenged Chaiten. “And if we were to adopt the rule that you suggest, it might very well be that either the federal government would have to subordinate its interests to the states or that the states would have to subordinate their interests to the federal government.”

Kagan said Chaiten’s argument seemed “frankly, a little bit one-note.” She said “30 justices” have upheld the separate sovereigns exception.

If the legal exception were to be overturned, “how does it work as a practical matter?” Chief Justice John Roberts asked Chaiten.

“Is it a race to the courthouse?” Roberts said.

The Trump administration says there is no good reason to overturn 170 years of precedent that are consistent with the separate sovereigns exception. Under America’s constitutional framework, both the federal and state governments are sovereign and their powers ought to be respected, Assistant to the U.S. Solicitor General Eric Feigin and Texas Solicitor General Kyle D. Hawkins told the court.

Justice Ruth Bader Ginsburg, who referred to placing an individual in double jeopardy as “a double whammy,” said Feigin. “You have to concede, won’t you, that this rule, this separate sovereign rule, has been widely criticized by both academics and federal judges?”

Addressing Feigin, Justice Neil Gorsuch expressed concern about “the proliferation of federal crimes” which number “over 4,000 statutes now and several hundred thousand regulations,” and of the opportunity for the federal government “to seek a successive prosecution if it’s unhappy with even the most routine state prosecution.”

“And that it is awkward, isn’t it, to say that there are two sovereigns who get to multiply offenses against you?” Gorsuch said. “I can’t think of another case where federalism is used, as Justice Ginsburg indicated, to allow greater intrusions against the person, rather than to protect more against them.”


Conservatives Perplexed by Supreme Court’s Refusal to Hear Planned Parenthood Case
December 11, 2018 Updated: December 11, 2018

Conservatives were taken aback Dec. 10 when the Supreme Court unexpectedly handed Planned Parenthood a victory by refusing to consider a potentially politically consequential state appeal of a lower court ruling.

That decision sided with Planned Parenthood after Republican state leaders in Kansas and Louisiana took state Medicaid funds away from the abortion provider.

Four of the nine Supreme Court justices needed to vote to hear the case for it to make its way onto the court’s docket but only three did so. Justice Brett Kavanaugh and Chief Justice John Roberts sided with their four liberal colleagues in turning aside the appeal.

Justice Clarence Thomas filed a passionate dissent to the majority’s decision to deny review. The court missed an opportunity to clarify conflicting circuit court decisions that affect the legal rights of the approximately 70 million Americans on Medicaid, Thomas said. Some of those individuals’ rights are being abridged under the status quo.

Two other conservative justices, Samuel Alito and Neil Gorsuch, joined in the dissent.

One of the key reasons that left-leaning lawmakers claimed for opposing Kavanaugh’s nomination was they feared he may vote to overturn or somehow weaken the court’s landmark ruling from 1973, Roe v. Wade, that struck down as unconstitutional laws that criminalized or restricted access to abortions.

Kavanaugh’s vote in this case has fueled speculation that he may be more friendly to abortion rights than Democrats expected. It’s possible that after the most contentious Supreme Court confirmation process in the modern era, Kavanaugh didn’t feel like rocking the judicial boat or confirming Democrats’ worst fears.

Commentator Daniel J. Flynn of the American Spectator takes a more critical view:

“Why did Brett Kavanaugh side with the court’s liberals in refusing to take a case that threatened to allow states to defund Planned Parenthood? Maybe because he told Senator Susan Collins the truth [during the confirmation process] when he promised to defer to precedent rather than the Constitution.

“Perhaps Kavanaugh turns out to fulfill the dreams of his conservative backers. But precedent—Sandra Day O’Connor, John Paul Stephens, David Souter, etc.—exists for Republican appointees issuing liberal rulings. Democrat justices, strangely, almost never offer surprises to their party’s base.”

Conservatives and others appeared mystified by the Dec. 10 decision after the conservative movement came through for President Donald Trump and made sure that newly appointed conservative Justice Kavanaugh was confirmed in the face of multiple–albeit unproven—accusations of sexual improprieties against the then-nominee and an unprecedented push by the mainstream media to prevent the confirmation.

If Kavanaugh wanted to have a major impact on health care policy “during his first session on the court, this would have been the case to do it,” Tim Jost, an emeritus professor at Washington and Lee University School of Law, told Politico.

Conservatives were less surprised by the decision of Roberts to take a pass on the case. Roberts infuriated conservatives when he provided the deciding vote in 2012 in the 5-to-4 split decision known as National Federation of Independent Business v. Sebelius, a ruling that upheld the Obamacare statute.

For the first time in the nation’s history, the court found that Americans could be compelled to buy a product even if they didn’t want it. Conservatives mocked what they considered to be the tortured legal reasoning in the opinion written by Roberts in which a bare majority of the justices decided that the since-rescinded individual mandate to buy health insurance was a constitutional exercise of Congress’s taxing power.

In his dissent, Thomas, who himself almost had his confirmation derailed by unproven sexual allegations years ago, blasted his six colleagues for letting politics take priority over impartial adjudication.

“So what explains the court’s refusal to do its job here?” Thomas wrote. “I suspect it has something to do with the fact that some respondents in these cases are named ‘Planned Parenthood.’ That makes the court’s decision particularly troubling, as the question presented has nothing to do with abortion.”

The case was brought by Jeff Andersen, acting secretary of the Kansas Department of Health and Environment, on appeal after losing in a lower court.

State Republicans were incensed after the Center for Medical Progress produced evidence that Planned Parenthood was extracting body parts from aborted fetuses and selling them. They sought to prevent any more funds from flowing to a nonprofit organization they deemed immoral and corrupt.

Planned Parenthood sued and convinced the U.S. Court of Appeals for the Fifth Circuit to allow Medicaid recipients to challenge its disqualification as a provider under the law governing Medicaid, a jointly funded state-federal health care program.

Various federal circuit courts have issued contradictory rulings on the issue, prompting Thomas to lay blame on the Supreme Court itself.

“The division in the lower courts stems, at least in part, from this court’s own lack of clarity on the issue,” Thomas wrote. “We created this confusion. We should clear it up.”


Supreme Court Will Consider Case That Could Help Undermine Administrative State
December 13, 2018 Updated: December 13, 2018

WASHINGTON—The Supreme Court’s decision on Dec. 10 to hear a veteran’s appeal of a bureaucratic denial of benefits could signal that the court is considering tearing away at the legal underpinnings of the modern administrative state.

Independent executive agencies are sometimes referred to as the “fourth branch” of the federal government in the United States. Critics say officials in the administrative state are unaccountable to voters and allow unelected bureaucrats to usurp the functions of the executive, legislative, and judicial branches. Congress, they say, is supposed to make the laws of the land, but lawmakers have steadily ceded that body’s constitutional powers to the administrative state, to the overall detriment of society.

Specifically, the decision to hear the case might foreshadow a narrowing of the application of the so-called Chevron doctrine that the Supreme Court enunciated in 1984.

In the landmark administrative law ruling in Chevron v. Natural Resources Defense Council, the high court held while courts “must give effect to the unambiguously expressed intent of Congress,” where courts find “Congress has not directly addressed the precise question at issue” and “the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.”

In other words, Chevron stands for the proposition that an executive agency’s interpretation of a statute it administers is entitled to deference unless Congress has said otherwise.

The current case, Kisor v. Wilkie, was brought by James L. Kisor, a U.S. Marine Corps veteran, who seeks disability benefits for his service-related post-traumatic stress disorder. While the Department of Veterans Affairs agrees Kisor suffers from service-related PTSD, it has refused to award him retroactive benefits.

According to Kisor’s petition, the government’s “decision turns on the meaning of the term ‘relevant’ as used in” a federal regulation. “On that basis alone, the court held that the regulation is ambiguous, and … deferred to the VA’s interpretation of its own ambiguous regulation.”

To receive the benefits to which he believes he is entitled, Kisor is asking the Supreme Court to overturn two cases, known as Auer v. Robbins, and Bowles v. Seminole Rock and Sand Co., that grow out of and build on Chevron-based judicial deference.

The decision to take the case “is a Big Deal in the battle against the metastasizing administrative state,” writes David French at National Review.

“Auer and Bowles are the Supreme Court cases that ‘direct courts to defer to an agency’s reasonable interpretation of its own ambiguous regulation,’” French writes. “It’s the Little Satan that works with the Great Satan—Chevron deference—to fuel the explosive growth in the power of executive-branch agencies.”

Supreme Court Justice Neil Gorsuch appears to be an advocate for scaling back or perhaps even uprooting the Chevron doctrine. When he sat on the U.S. Court of Appeals, he argued the legal principle was fundamentally unsound:

“Transferring the job of saying what the law is from the judiciary to the executive unsurprisingly invites the very sort of due-process (fair notice) and equal-protection concerns the framers knew would arise if the political branches intruded on judicial functions.

“Under Chevron, the people aren’t just charged with awareness of and the duty to conform their conduct to the fairest reading of the law that a detached magistrate can muster. Instead, they are charged with an awareness of Chevron; required to guess whether the statute will be declared ‘ambiguous’ (courts often disagree on what qualifies); and required to guess (again) whether an agency’s interpretation will be deemed ‘reasonable.’

“Who can even attempt all that, at least without an army of perfumed lawyers and lobbyists? And, of course, that’s not the end of it. Even if the people somehow manage to make it through this far unscathed, they must always remain alert to the possibility that the agency will reverse its current view 180 degrees anytime, based merely on the shift of political winds and still prevail.”

The decision to hear the Kisor case came after the court unanimously overruled bureaucrats enforcing the Endangered Species Act, ruling Nov. 27 that the federal government overreached by limiting the development of private land in Louisiana to help save a rare frog that doesn’t actually live there.

Legal observers say that ruling chipped away at the Chevron doctrine and may be a sign that the court intends to further narrow its application.


Lawyer in Successful Challenge to Obamacare Sees Victory for Freedom
Overturning of restrictive Affordable Care Act law opens the door to new freedom and better care for consumer. lower costs, says lawyer in an exclusive interview
December 16, 2018 Updated: December 16, 2018

A federal judge’s surprise move late in the day on Dec. 14 to strike down the Affordable Care Act statute in its entirety is sending shock waves through the political world, but a jubilant lawyer on the winning legal team said the court ruling strikes a blow for freedom, is constitutionally sound, and is here to stay.

The Dec. 14 ruling by Judge Reed O’Connor of the Northern District of Texas was hailed by President Donald Trump but promptly assailed by former President Barack Obama, his liberal allies, and some legal commentators, largely on hyper-technical procedural grounds as opposed to whether the law itself runs afoul of the U.S. Constitution.

When Congress in 2017 effectively repealed the mandate that compelled Americans to buy health insurance it “sawed off the last leg it [i.e. Obamacare] stood on,” the judge held. “The court finds the individual mandate ‘is essential to’ and inseverable from ‘the other provisions of’” the so-called Patient Protection and Affordable Care Act.

Time to ‘Stand Down’
Robert Henneke, who represented Neill Hurley and John Nantz, two successful consumer-plaintiffs in the lawsuit, gave an exclusive interview to The Epoch Times. He is the director of the Center for the American Future at the Austin-based Texas Public Policy Foundation

“To give a contrary example to those who are critical of this opinion, alleging that it will cause people to lose their insurance, I would point to the fact that you already have millions of people who have lost their insurance because of their inability to afford” the government-mandated plans, Henneke said.

Now is the time for genuine health care reform, not more federal meddling in Americans’ lives, he said.

“We need to look at the policy not through the courts but by the legislative process and I think this is the more important lesson of how critical it is for the states to now reassert themselves in their role, to step back in and to be the drivers of health care policymaking,” he said.

“We also look to encourage Washington to recognize this for the sea change that it is and to stand down. It’s never been a proper role for the federal government to regulate health care and health insurance. It is a proper role for the states.”

‘Third Chapter’
The decision was handed down the day before the deadline for Americans to enroll in federal insurance exchanges created under the Affordable Care Act statute. That law was enacted in March 2010 without a single Republican vote in Congress on final passage. Insurance premiums skyrocketed, and critics blame the Affordable Care Act for out-of-control costs and added bureaucratic red tape.

Months or even years of legal appeals by supporters of the law are now a certainty. Democratic California Attorney General Xavier Becerra has promised to appeal the decision, and both sides expect the legal controversy to eventually find its way to the Supreme Court. A court injunction of some kind to temporarily forestall the administrative dismantling of the Affordable Care Act pending those appeals seems likely.

Judge O’Connor’s ruling is not expected to become effective in the immediate future. The decision has “no impact to current coverage or coverage in a 2019 plan,” Seema Verma, administrator for the Centers for Medicare and Medicaid Services, wrote on Twitter.

Henneke outlined the Affordable Care Act’s journey through the courts.

In a 2012 case known as NFIB v. Sebelius, the Supreme Court upheld the all-encompassing, 2,000-page act as constitutional, on the theory that the individual mandate—which forced Americans to buy health insurance even if they didn’t want it—was a valid exercise of Congress’s power to tax. Chief Justice John Roberts surprised many by voting to uphold the law, leading to a 5–4 vote in favor.

The court again upheld the individual mandate in 2015 in King v. Burwell, in a 6–3 vote. In 2017, Congress effectively rendered the mandate a legal nullity by reducing the tax penalty for not purchasing insurance to zero effective 2019.

Nineteen states, including Texas, and consumers then filed suit contending that the revised law was unconstitutional because the individual mandate was so integral to the law that it could not function without it. Sixteen states took the opposite position and argued the changed statute should be upheld.

The new ruling is “the third chapter in the trilogy” of major challenges to the Affordable Care Act, Henneke said.

‘Essential Component’

“The entire Affordable Care Act, when it was originally crafted by Congress, was built around the individual mandate penalty—the premise that the way to fund and to make viable this entire regulatory scheme was by compelling individuals to purchase health insurance,” Henneke said. “Hard-written into the statute in many ways is how it’s an essential component and how the regulatory scheme doesn’t function without the individual mandate penalty.”

Henneke said that in the NFIB v. Sebelius case, the Supreme Court construed the mandate as an exercise of congressional taxing power because it generated revenue, rejecting the government’s argument that the mandate could be justified under the Constitution’s Commerce Clause.

Because the mandate penalty was zeroed-out, it no longer would generate revenue and cannot be deemed an exercise of congressional tax power, he said.

According to Judge O’Connor’s decision, the mandate is “therefore … unconstitutional and because the entirety of the Affordable Care Act is built around the individual mandate penalty … the entire statute failed and was declared invalid.”

Future Outlook
As a result of the ruling, the outlook for American health care is bright, Henneke said.

“I think we can look back over the last few years and take away some lessons that we can implement at the state level to drive back down costs but also provide for choice of health care provider, and also to look at the regulatory system of insurance and ways that we can restore the relationship between doctor and patient,” he said.

“So all of that should start now and all of that can be happening now while litigation proceeds. My hope is that we can restore integrity to our health care system and fix these problems that Obamacare has caused and that continue to be a major challenge for millions of Americans who have lost their insurance because they can’t afford it anymore, or have lost their doctors because they’re not covered by an Affordable Care Act plan.”

Late Dec. 14, President Donald Trump wrote on Twitter: “As I predicted all along, Obamacare has been struck down as an UNCONSTITUTIONAL disaster! Now Congress must pass a STRONG law that provides GREAT healthcare and protects pre-existing conditions.”

Trump urged Senate Majority Leader Mitch McConnell (R-Ky.) and incoming Speaker of the House Nancy Pelosi (D-Calif.) to “get it done!”

A few minutes later, he added: “Wow, but not surprisingly, ObamaCare was just ruled UNCONSTITUTIONAL by a highly respected judge in Texas. Great news for America!”


‘Lawfare’ Used to Tie Down and Punish President Trump, Conservatives Say
December 23, 2018 Updated: December 23, 2018

The huge array of legal proceedings and investigations now being undertaken against President Donald Trump, his campaign, his transition team, and associates is a carefully orchestrated effort to drive him from office, according to conservatives interviewed by The Epoch Times.

The seemingly endless parade of legal actions against Trump is the legal equivalent of throwing darts at a bulletin board or spinning a roulette wheel. Trump’s enemies will take anything they can get in order to end his presidency, conservatives say.

This white-hot explosion of litigiousness is what is known as “lawfare,” a neologism that is a portmanteau of the words “law” and “warfare.” One online source defines lawfare as “a form of war consisting of the use of the legal system against an enemy, such as by damaging or delegitimizing them, tying up their time or winning a public relations victory.”

Organized Resistance
The current lawfare effort is an extension in the nation’s legal system of the organized resistance to Trump that left-wing activists, nonprofits, and well-heeled foundations launched immediately after the Republican unexpectedly triumphed over the heavily favored Democrat candidate Hillary Clinton in November 2016.

“This is a full frontal attack on Trump World,” writes William A. Jacobson at Legal Insurrection. Jacobson is a clinical professor of law and director of the Securities Law Clinic at Cornell Law School. “And it’s just a continuation of the refusal to accept the results of the election with a Lilliputian strategy to tie down the giant. The sheer breadth of investigations is the point.”

This well-funded legal conspiracy, as it has been characterized by some Trump defenders, is vast, far-reaching, and subsidized by taxpayers. Most, but not all of the players are Democrats. Some of the federal prosecutors involved were appointed by Trump. But all have come under pressure from Democrats and left-wing activists.

17 Investigations
Garrett M. Graff of Wired magazine put together a list of 17 known investigations that target “President Trump’s world from various federal, state, and local prosecutors.” There are sources known to be cooperating with investigators in nearly all of these open cases, Graff said.

Special counsel Robert Mueller is investigating Russian meddling in U.S. elections, WikiLeaks, Middle Eastern influence on the Trump campaign, former Trump campaign manager Paul Manafort, the abandoned Trump Tower Moscow project, Trump-campaign and transition-team contacts with Russia, and obstruction of justice.

Geoffrey Berman, U.S. attorney for the Southern District of New York, is investigating campaign conspiracies and Trump Organization finances, inauguration funding, Trump super PAC funding, and foreign lobbying.

Jessie K. Liu, U.S. attorney for the District of Columbia, is investigating alleged Russian spy Maria Butina and the National Rifle Association (NRA).

Zachary Terwilliger, U.S. attorney for the Eastern District of Virginia, is investigating Elena Alekseevna Khusyaynova, allegedly chief accountant of the Internet Research Agency, who was previously indicted.

Turkish influence on Trump and his circle also is being investigated. Former national security adviser Michael Flynn’s plea agreement provides some details of the allegations. Flynn is cooperating with authorities.

Democratic-controlled New York City and New York state, as well as attorneys general from other largely Democratic states, are investigating various tax-related allegations. A New York Times report claims Trump “benefited from more than $400 million in tax schemes, [and] city officials said they were investigating Trump’s tax payments, as did the New York State Tax Department.”

The attorneys general for the District of Columbia and Maryland, respectively Karl A. Racine (D) and Brian Frosh (D), issued subpoenas this month for Trump Organization and hotel financial records related to the almost-impossible-to-prove-allegation that the president is in violation of the Emoluments Clause of the U.S. Constitution. The clause forbids government officials from receiving gifts from foreign states and monarchies without the consent of Congress in the hope of shielding the “small-R” republican character of the United States from corrupting foreign influences.

Finally, there is a mysterious investigation originating from an unknown office, according to Graff. An investigation referenced in the Flynn case could “represent another as-yet-unknown unfolding criminal case or could be a counterintelligence investigation that will never become public.”

Tying Down the President
Of course, it is possible that the president or his associates could be guilty of wrongdoing not yet unearthed or made public, but conservatives contacted by The Epoch Times say the sheer volume of the allegations suggest both prosecutorial overkill and a concerted effort to tie down the president by means of litigation.

Robert Weissberg, a professor emeritus of political science at the University of Illinois at Urbana-Champaign, said Democrats are using the courts to try to bring down Trump because they are bereft of ideas.

“This litigation madness reflects the collapse of viable policy alternatives among Democrats, particularly those on the far left,” Weissberg said.

“If you list the major problems facing America—immigration, failing schools, health care, drug addiction, collapsing infrastructure, a permanent urban (black) underclass, among others—there are no obvious solutions. Especially solutions that could unite the Democratic Party. We’ve become a fractured nation.

“Rather than hash out a politically workable solution, the Dems wander off into controversies and investigations.

“This is very different from, say, 50 years ago when Dems still believed in their solutions. Yes, they insisted, Head Start would do the trick and inner-city blacks could become middle class if we just enforced the anti-discrimination laws. What we now see, to be glib, is the end of policy debate.

“The entire Russia thing is a distraction.”

Hush-Money Payments
Donny Ferguson, president of Americans for a Better Economy, an Alexandria, Virginia-based nonprofit organization, said there is no evidence Trump personally colluded with Russia to sway the 2016 election, but that doesn’t mean all the investigations are completely meritless.

“Right now, it appears the Mueller investigation is what we always knew it was—several Trump associates not disclosing business ties with Russia,” Ferguson, said. “The only campaign collusion with Russia appears to be from the Clinton campaign and Democratic National Committee.”

Ferguson said Trump’s hush-money payments to women he allegedly had affairs with will continue to cause legal problems for him. When former presidential candidate and Sen. John Edwards (D-N.C.) went on trial years ago, both the judge and jury agreed that payments made to a mistress for silence during a campaign were campaign expenses.

“The prosecution in the Edwards case had no evidence showing it was Edwards himself who convinced two other people to make payments from accounts they controlled,” Ferguson said.

“In Trump’s case, he’s on tape directing the payments from accounts he controlled. They appeared to be corporate accounts, creating another apparent violation.

“The question is whether such violations are impeachable offenses, and that’s far from clear.”

‘Weaponizing the Power of Government’
Robert Henneke, director of the Center for the American Future at the Austin-based Texas Public Policy Foundation, suggested those going after Trump have bad motives.

“You’re weaponizing the power of government in most of these situations involving criminal penalties and criminal prosecutions, where a driving factor seems to be a person or a specific target, or there is a partisan shade to it,” said Henneke, who was on the winning legal team in a lawsuit that led to the striking down of Obamacare by federal Judge Reed O’Connor of the Northern District of Texas on Dec. 14.

“I think certainly with respect to the Mueller investigation, it has questionable legitimacy as it’s way far afield from what the original intent was supposed to be.”

The plea that Trump’s former personal attorney, Michael Cohen, entered after being investigated by Mueller is “questionable,” Henneke said. It isn’t at all clear that “what he pled to is a violation of federal election laws.”

This fast-and-loose approach to enforcing the law can also be used against government officials, he said.

“Where there is a will to do so, you can probably figure out a reason to prosecute any federal official. If you look hard enough, you can interpret campaign finance laws in a way that would result in there being an offense,” Henneke said.

When the administrative state “gets so big and so broad that nobody really knows what is really a crime or not” when you couple that with “politically driven prosecutions for government action, that should be concerning for all Americans.”

Prosecutors in his home state of Texas have abused their powers before, Henneke noted.

Former U.S. House Majority Leaders Tom DeLay (R-Texas) and Dick Armey (R-Texas), and former Texas Gov. Rick Perry (R), who is a now a Trump cabinet member, were hounded for years by prosecutors who ended up having little to show for their efforts, he said.

And this kind of the-ends-justify-the-means mentality leads to frightening results, Henneke said, citing the recent example of in-your-face New York Attorney General-elect Letitia James (D).

“James said more or less that ‘I’m getting elected to take away Trump’s money and to go after his businesses,’” he said. “I mean that’s completely contrary to the notion of justice. You don’t want to have a government that picks a target first and then figures out what for afterward.”

Demoralizing Voters
Tina Trent, a former candidate for District 26 of the Georgia General Assembly, said the bevy of lawsuits is best understood as one way of demoralizing potential Trump voters and suppressing turnout in the 2020 presidential election.

What’s in the lawsuits, which should be viewed more “as a protest movement than serious legal inquiry,” matters less than their quantity, she said.

“This is Trump derangement syndrome via litigation by a thousand cuts: they are providing left-wing media and their audiences with a steady stream of ‘breaking news’ on alleged new legal scandals, and they really don’t care about the success or even the credibility of any single investigation,” Trent said.

The lawsuits amount to propaganda, she said.

“Propaganda works by overwhelming the senses and crowding out rational debate. The mainstream media in America has been a propaganda mouthpiece for the Left for so long in America that we’ve grown used to seeing bias in news reports, but there is still something new and frightening in watching media personalities ranting hysterically over these Trump investigations in every cranny of social media, late-night talk shows, and even the sections of magazines that are supposed to be about fashion and lifestyle,” Trent said.

Every aspect of Trump’s daily life in the White House is actually being put on display every minute of every day, from the way the first lady decorated their Christmas trees to the allegedly toxic effect Trump is having on individual holiday family gatherings, she explained.

Trump is being accused “of ruining Christmas family gatherings and blighting dating scenes for single adults looking for love” as he is “bitterly and hatefully charged by important media figures with literally destroying everything good in the world and causing everything bad,” Trent added.

An attorney and historian, who asked not to be identified, disagreed somewhat with the other conservatives interviewed.

“It’s a mistake to see this as coming from ‘Democrats,’” he said.

The assault on Trump “comes from inside the Washington bureaucracy, what some people are calling the ‘deep state’ or the ‘swamp.’ It’s a big mistake to associate these people solely with the Democrat Party. They are part of something much larger and more important than the Democrat Party, and the Republican Party apparatus is mostly just as captive to them.”

“But the real reason the intelligence/federal law enforcement people are going after Trump is, in my opinion, that he is capturing the attention of people who are true nationalists, people who understand and are spreading the message that our government is being held captive and would like to do something about it. So, he must be destroyed. Not beaten in an election. That isn’t nearly enough punishment to send the message that they want to send,” he said.