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Supreme Court Nominee's Views on Business Are Hard to Read

June 10, 2009
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Companies likely would find Sonia Sotomayor an evenhanded judge of business issues if she joins the U.S. Supreme Court, observers say.

Judge Sotomayor, whom President Barack Obama nominated last month to fill the vacancy created by the retirement of Justice David Souter, has a reputation as a liberal on social issues. But on business issues, she is as likely to rule in favor of companies as against them, observers say.

Sotomayor, who has been both a New York prosecutor and a corporate intellectual property attorney, was appointed in 1992 as a federal judge by President George H.W. Bush. In 1998, President Bill Clinton elevated her to the 2nd U.S. Circuit Court of Appeals in New York, where she has served since.

Her most prominent decision may have been her 1995 ruling as a district court judge that effectively ended the 232-day Major League Baseball strike, a ruling President Obama cited when he introduced her.

Also regarded as significant is her role as a member of the three-judge panel that ruled in June 2008 for New Haven, Connecticut, in Frank Ricci et al. v. John DeStefano et al. in rejecting reverse discrimination charges brought by white firefighters.

Appellate attorney Thomas H. Dupree Jr., a partner with Gibson, Dunn & Crutcher in Washington, says that while the Supreme Court tends to vote along a traditional conservative-liberal split on affirmative action and related constitutional issues, “business cases are different, and I don’t think that you can really reliably predict” how Sotomayor is likely to rule.

“There are a lot of cases where she’s ruled for business and a lot of cases where she's ruled against business,” Dupree says.

“I think there is reason to believe that she is a moderate on issues that are of concern to the business community,” says Lauren Rosenblum Goldman, an appellate attorney and partner with law firm Mayer Brown in New York.

“She has resisted attempts by plaintiffs lawyers ... to allow more class actions to be brought against business” and has been a moderate on federal pre-emption issues, Goldman says.

“She is a careful and thoughtful jurist,” says Goldman.

Mainstream views
Employment law attorney Michael W. Fox, a shareholder with law firm Ogletree, Deakins, Nash, Smoak & Stewart in Austin, Texas, has reviewed Sotomayor’s employment-related decisions. She “looks to me like someone who’s pretty traditional in the sense of not far out of the mainstream one way or the other,” Fox says.

Sotomayor has ruled both for and against employers and is willing to “side with the Establishment if she feels they’ve got the strong argument,” Fox says.

Although Sotomayor is likely to fall on the liberal side of the court’s liberal-conservative split, Fox says, “it strikes me that the business community should not be terribly upset” by her nomination.

“You just don’t seem to be able to find any sort of political agenda” in her decisions, says employment law attorney Dennis Westlind, a member of law firm Stoel Rives in Portland, Oregon.

Even the Ricci ruling was “sensible” in that ruling against New Haven would have led to filing more class-action discrimination lawsuits, says Paul J. Siegel, a partner with employment law firm Jackson Lewis in Melville, New York.

Employment law attorney Bettina B. Plevan, a partner with Proskauer Rose in New York, says that while Sotomayor likely would show empathy for cases involving individuals who oppose big companies, “many of the issues that go before the Supreme Court are one business against another business.”

With regard to insurance cases, “She’s been extremely favorable to insurers in coverage disputes,” says Randy J. Maniloff, an insurer attorney with White & Williams in Philadelphia. “The fact [that] she favors insurers so much, who are typically not a sympathetic bunch, would be further evidence that she’s not as liberal on business issues as she might be on social issues,” he says.

However, Richard Samp, chief counsel for the Washington Legal Foundation, says he is “tentatively troubled” by Judge Sotomayor’s nomination. For instance, her 2005 decision in Shadi Dabit v. Merrill Lynch, which the U.S. Supreme Court overturned in a unanimous ruling, “would have significantly expanded the scope of securities fraud class actions.”

Even so, “we certainly want to take a careful look, and we recognize that whoever is going to get confirmed is going to be a Democratic nominee that is probably more liberal than I would choose,” Samp says.

Meanwhile, Sotomayor’s tenure on the 2nd U.S. Circuit Court of Appeals, which frequently rules on business issues, will be a positive for businesses, Dupree says. “As a lawyer, you always want to have a knowledgeable and experienced judge,” he says.

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