USA v. ARIZONA - THE SB1070 CASE ON APPEAL - PART TWO

Judge Paez's section by section analysis of the enjoined sections of Arizona's SB 1070 began with section 2(b).

S.B. 1070 Section 2(B) provides, in the first sentence, that when officers have reasonable suspicion that someone they have lawfully stopped, detained, or arrested is an unauthorized immigrant, they “shall” make “a reasonable attempt . . .when practicable, to determine the immigration status” of the person. Ariz. Rev. Stat. Ann. § 11-1051(B) (2010).

Section 2(B)’s second and third sentences provide that “any person who is arrested shall have the person’s immigration status determined before the person is released,” and “the person’s immigration status shall be verified with the federal government.” 

The Section’s fifth sentence states that a “person is presumed to not be an alien who is unlawfully present in the United States if the person provides” a form of identification included in a prescribed list.

Arizona argues that its officers are only required to verify the immigration status of an arrested person before release if reasonable suspicion exists that the person lacks proper documentation. Paez refutes Arizona's argument by employing statutory analysis.

On its face, Paez writes, the text does not support Arizona’s reading of Section 2(B). The second sentence is unambiguous: “Any person who is arrested shall have the person’s immigration status determined before the person is released.” Ariz. Rev. Stat. Ann. § 11-1051(B) (2010). 

The all encompassing “any person,” the mandatory “shall,” and the definite “determined,” make this provision incompatible with the first sentence’s qualified “reasonable attempt . . . when practicable,” and qualified “reasonable suspicion.” In addition, the opinion says, Arizona’s reading creates irreconcilable confusion as to the meaning of the third and fifth sentences.

The Ninth Circuit agrees with the district court that the reasonable suspicion requirement in the first sentence does not modify the plain meaning of the second sentence. Thus, Section 2(B) requires officers to verify — with the federal government — the immigration status of all arrestees before they are released, regardless of whether or not reasonable suspicion exists that the arrestee is an undocumented immigrant.

The Ninth Circuit is required to determine the purpose of Congress and then determine if the Congress legislated in an area typically and traditionally occupied by the States. The Ninth Circuit concluded that The states have not traditionally occupied the field of identifying immigration violations so they did not apply a presumption against preemption for Section 2(B).

Paez began his inquiry into Congressional purpose by focusing on 8 U.S.C. § 1357(g) of the INA. That section is titled "Performance of immigration officer functions by State officers and employees.”

Congress, Paez says, has instructed under what conditions state officials are permitted to assist the Executive in the enforcement of immigration laws. Congress has provided that the Attorney General “may enter into a written agreement with a State . . . pursuant to which an officer or employee of the State . . . who is determined by the Attorney General to be qualified to perform a function of an immigration officer in relation to the investigation, apprehension, or detention of aliens in the United States . . . may carry out such function.” 8 U.S.C. § 1357(g)(1). Subsection (g)(3) provides that “in performing a function under this subsection, an officer . . . of a State . . . shall be subject to the direction and supervision of the Attorney General.” 8 U.S.C. § 1357(g)(3). Subsection (g)(5) requires that the written agreement must specify “the specific powers and duties that may be, or are required to be, exercised or performed by the individual, the duration of the authority of the individual, and the position of the agency of the Attorney General who is required to supervise and direct the individual .”

The provisions of the INA, according to Paez, demonstrate that Congress intended for states to be involved in the enforcement of immigration laws under the Attorney General’s close supervision. Not only must the Attorney General approve of each individual state officer, he or she must delineate which functions each individual officer is permitted to perform.

The Court of Appeals interprets subsection (g)(10)(B) to mean that when the Attorney General calls upon state and local law enforcement officers—or such officers are confronted with the necessity—to cooperate with federal immigration enforcement on an incidental and as needed basis, state and local officers are permitted to provide this cooperative help without the written agreements that are required for systematic and routine cooperation.

Similarly, the Court of Appeals interprets subsection (g)(10)(A) to mean that state officers can communicate with the Attorney General about immigration status information that they obtain or need in the performance of their regular state duties. But subsection (g)(10)(A) does not permit states to adopt laws dictating how and when state and local officers must communicate with the Attorney General regarding the immigration status of an individual. Subsection (g)(10) does not exist in a vacuum, Paez writes; Congress enacted it alongside subsections (g)(1)-(9) and we therefore interpret subsection (g)(10) as part of a whole, not as an isolated provision with a meaning that is unencumbered by the other constituent parts of § 1357(g).9

Delivering the bottom line Paez writes that in sum, 8 U.S.C. § 1357(g) demonstrates that Congress intended for state officers to systematically aid in immigration enforcement only under the close supervision of the Attorney General — to whom Congress granted discretion in determining the precise conditions and direction of each state officer’s assistance.

The Court of Appeals found it particularly significant for the purposes of the present case that this discretion includes the Attorney General’s ability to make an individual officer’s immigration enforcement duties permissive or mandatory. 8 U.S.C. § 1357(g)(5).

Arizona's SB1070 Section 2(B) sidesteps Congress’ scheme for permitting the states to assist the federal government with immigration enforcement. Through Section 2(B), Arizona has enacted a mandatory and systematic scheme that conflicts with Congress’ explicit requirement that in the “performance of immigration officer functions by State officers and employees,” such officers “shall be subject to the direction and supervision of the Attorney General.” 8 U.S.C. § 1357(g)(3). Section 2(B) therefore interferes with Congress’ scheme because Arizona has assumed a role in directing its officers how to enforce the INA.

The Court of Appeals is not aware of any INA provision demonstrating that Congress intended to permit states to usurp the Attorney General’s role in directing state enforcement of federal immigration laws.

Arizona argues that in another INA provision, “Congress has expressed a clear intent to encourage the assistance from state and local law enforcement officers,” citing 8 U.S.C. § 1373(c). That section, Paez writes, creates an obligation, on the part of the Department of Homeland Security (DHS), to “respond to an inquiry by a Federal, State, or local government agency, seeking to verify or ascertain the citizenship or immigration status of any individual . . . for any purpose authorized by law.”

The Court of Appeals agree that § 1373(c) demonstrates that Congress contemplated state assistance in the identification of undocumented immigrants. We add, however, that Congress contemplated this assistance within the boundaries established in § 1357(g), not in a manner dictated by a state law that furthers a state immigration policy.

The Heart of the Ruling

The Ninth Circuit finds ample rationale for applying the federal preemption doctrine. Paez writes that by imposing mandatory obligations on state and local officers, Arizona interferes with the federal government’s authority to implement its priorities and strategies in law enforcement, turning Arizona officers into state-directed DHS agents. As a result, Section 2(B) interferes with Congress’ delegation of discretion to the Executive branch in enforcing the INA.

S.B. 1070 Section 2(B) “stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress” as expressed in the aforementioned INA provisions. The law subverts Congress’ intent that systematic state immigration enforcement will occur under the direction and close supervision of the Attorney General. Furthermore, the mandatory nature of Section 2(B)’s immigration status checks is inconsistent with the discretion Congress vested in the Attorney General to supervise and direct State officers in their immigration work according to federally-determined priorities.

In addition to Section 2(B) standing as an obstacle to Congress’ statutorily expressed intent, the record unmistakably demonstrates that S.B. 1070 has had a deleterious effect on the United States’ foreign relations, which weighs in favor of preemption. See generally Garamendi, 539 U.S. 396 (finding obstacle preemption where a State law impinged on the Executive’s authority to singularly control foreign affairs); Crosby, 530 U.S. 363 (same). In Garamendi, the Court stated that “even . . . the likelihood that state legislation will produce something more than incidental effect in conflict with express foreign policy of the National government would require preemption of the state law.”

Actual Foreign Policy Problems

The record before this court demonstrates that S.B. 1070 does not threaten a “likelihood . . . [of] producing] something more than incidental effect;” rather, Arizona’s law has created actual foreign policy problems of a magnitude far greater than incidental. Garamendi, 539 U.S. at 419 (emphasis added). Thus far, the following foreign leaders and bodies have publicly criticized Arizona’s law: The Presidents of Mexico, Bolivia, Ecuador, El Salvador, and Guatemala; the governments of Brazil, Colombia, Honduras, and Nicaragua; the national assemblies in Ecuador and Nicaragua and the Central American Parliament; six human rights experts at the United Nations; the Secretary General and many permanent representatives of the Organization of American States; the Inter-American Commission on Human Rights; and the Union of South American Nations.

In addition to criticizing S.B. 1070, Mexico has taken affirmative steps to protest it. As a direct result of the Arizona law, at least five of the six Mexican Governors invited to travel to Phoenix to participate in the September 8-10, 2010 U.S. - Mexico Border Governors’ Conference declined the invitation. The Mexican Senate has postponed review of a U.S.-Mexico agreement on emergency management cooperation to deal with natural disasters.

Relying on the record, and testimony from Deputy Secretary of State James B. Steinberg, the Ninth Circuit found that these factors persuade us that Section 2(B) thwarts the Executive’s ability to singularly manage the spillover effects of the nation’s immigration laws on foreign affairs.

Finally, Paez writes, the threat of 50 states layering their own immigration enforcement rules on top of the INA also weighs in favor of preemption. The Court of Appeals cites Hines v. Davidowitz on this point:

The Federal Government, representing as it does the collective

interests of the forty-eight states, is entrusted with full and exclusive

responsibility for the conduct of affairs with foreign sovereignties.

“For local interests the several states of the Union exist, but for national purposes, embracing our relations with foreign nations, we are but one people, one nation, one power.” Our system of government is such that the interest of the cities, counties and states, no less than the interest of the people of the whole nation, imperatively requires that federal power in the field affecting foreign relations be left entirely free from local interference.

The Court of Appeals concluded that the United States has met its burden to show that there is likely no set of circumstances under which S.B. 1070 Section 2(B) would be valid, and it is likely to succeed on the merits of its challenge. That's the inconceivable standard, it is inconceivable that any application of SB 1070 passes Constitutional muster. The district court did not abuse its discretion by concluding the same.

Part Three of this series will focus on Judge Paez's analysis of Section 3 of SB1070.

VOLATILE ENERGY HEDGE FUNDS - PATENT LAW - & BIRDS OF FEATHER FLOCKING TOGETHER

Another unanimous fractured opinion has emerged from the nation's Marble Palace. The case is Bilski v. Kappos, No -08-694. Bernard Bilski and Rand Warsaw applied for a patent. They didn't invent a "thing" as much as they figured out a really complex mathematical problem. Their discovery explains how buyer and sellers of commodities in the energy market can protect, or hedge, against the risk of price changes. I wonder how Bilski and Warsaw account for fraud in their calculations. Fraud was the issue with Enron in the largest collapse of a company in the energy market to date.

The patent examiner rejected Bilski and Warsaw's application because their "invention" is not implemented on a specific apparatus, but merely manipulates an abstract idea solving a purely mathematical problem. The Board of Patent Appeals and Interferences agreed and affirmed. The Federal Circuit, in turn, affirmed.

The Federal Circuit sitting en banc rejected its prior test for determining whether a claimed invention was a patentable “process” under Patent Act, 35 U. S. C. §101— i.e., whether the invention produced a “useful, concrete, and tangible result,” — holding instead that a claimed process is patent eligible if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. Concluding that this “machine-or-transformation test” is the sole test for determining patent eligibility of a “process” under §101, the court applied the test and held that the application was not patent eligible.

The Supreme Court upheld the judgment of the Federal Circuit, but took that court to task for its narrow interpretation of Patent Law.

The Patent Law specifies four independent categories of inventions or discoveries that are patent eligible: “processes,” “machines,”“manufactures,” and “composition[s] of matter.” “In choosing such expansive terms, . . . Congress plainly contemplated that the patent laws would be given wide scope. Prior decisions of the Supreme Court provide precedents provide three specific exceptions to §101’s broad principles: laws of nature, physical phenomena, and abstract ideas. The Bilski/Warsaw concept is clearly an abstract idea.

Even if the Bilski/Warsaw concept had been otherwise patent eligible it would have still been required to demonstrate novelty, nonobviousness, and demonstrate a full and particular description. The invention at issue is claimed to be a “process,” which the Patent Law defines as a “process, art or method, and includes a new use of a known process, machine, manufacture, composition of matter, or material.”

The Court ruled that the Machine-or-Transformation Test was not the sole test determining patent eligibility. The Court said this test may be a useful and important clue or investigative tool, it is not the sole test for deciding whether an invention is a patent-eligible “process”.

The Federal Circuit violated two principles of statutory interpretation, the Court said. Courts should not read into the patent laws limitations and conditions which the legislature has not expressed. Unless otherwise defined, words will be interpreted as taking their ordinary, contemporary, common meaning. The Court is unaware of any ordinary, contemporary, common meaning of “process” that would require it to be tied to a machine or the transformation of an article.

The Patent Director argued that looking at all sections of the Patent Law where the term "process" was used led to the confining opinion that the "process" need be tied to the Machine-or Transformation Test. Associate Justice Kennedy said that the doctrine of noscitur a sociis does not apply here. Noscitur a sociis is a Latin phrase meaning "it is known by the company it keeps". Hence the translation is "birds of a feather flock together". This legal maxim originated in England with the dicta of Judge Stamp in the 1967 case of Bourne v. Norwich Crematorium, Ltd where he said:

"Sentences are not mere collections of words to be taken out of the sentence, defined separately by reference to the dictionary or decided cases, and then put back into the sentence with the meaning you have assigned to them as separate words."

What Kennedy is saying that there wasn't anything unclear about the word "process." It was not necessary for the Patent Office and the Federal Circuit to limit the language provided by the Congress.

Kennedy refers to the Federal Circuit's sole test as the categorical exclusion argument. He says, "The categorical exclusion argument is further undermined by the fact that federal law explicitly contemplates the existence of at least some business method patents: Under §273(b)(1) [ of the Patent Law], if a patent-holder claims infringement based on “a method in [a] patent,” the alleged infringer can assert a defense of prior use. By allowing this defense, the statute itself acknowledges that there may be business method patents. Section 273 thus clarifies the understanding that a business method is simply one kind of “method” that is, at least in some circumstances, eligible for patenting under §101. A contrary conclusion would violate the canon against interpreting any statutory provision in a manner that would render another provision superfluous."

Having corrected the Federal Circuit the Court goes on to explain that Bilski and Warsaw fail because they are trying to "patent both the concept of hedging risk and the application of that concept to energy markets". Kennedy said "these are not patentable processes but attempts to patent abstract ideas."

Abstract ideas are not patent eligible.

I called this a fractured opinion because Associate Justice Kennedy delivered the opinion of the Court except as to Parts II-B-2 and II-C-2.  The Court agreed in the outcome only.