Legal News

High Court Negs Judge Alex; Scalia Opines on Preemption

By Dan Slater

LB Second Update: Via email, we just heard back the winning party in the case, Arnold Preston, who had argued the case belonged in arbitration. He said: I am thrilled at the United States Supreme Court’s 8-1 decision. As I said all along, this matter clearly belonged in Arbitration from the very beginning. It’s unfortunate the “Honorable” Judge Alex attempted to not abide by his contract with me thereby causing a lengthy delay and incurring excessive and unnecessary costs. I am looking forward to finally having the Arbitrator hear this matter, as we contractually agreed, and am very much looking forward to prevailing on the merits in that forum.

LB Update: Via email, we just heard back from Judge Alex. Here’s his take on today’s High Court opinion, which went against him: Given her expertise on handling these types of matters, I certainly agreed with all of the lower courts that California’s Labor Commissioner was best suited for determining Mr. Preston’s violation of the Talent Agencies Act. Nonetheless, I respect the Supreme Court’s decision and look forward to prevailing below on the merits.

The Mill of Justice is cranking at full-speed today down at 1 First Street NE. Herewith are decisions in three of the more interesting Supreme Court cases:

Judge Alex Dismissed: Alex Ferrer (pictured), a dashing former judge who now settles disputes on daytime television, has been locked in conflict with his former manager, Arnold Preston — an ex-criminal defense lawyer who now produces a gospel talent show on cable — over how much the former manager should’ve received in commissions. The question before the court today was not who’s right, but who gets to decide who’s right. (Click here for a WSJ front-page profile of Ferrer and his case from last month.) The Court ruled 8-1 against Ferrer, holding that an arbitrator must decide the dispute. Here’s the decision.

Scalia On Preemption: In an 8-1 ruling penned by Justice Scalia, the court held that federal medical-device regulations preempt state product liability suits unless there’s a parallel FDA violation. Here’s the early report from WSJ on the Medtronic case, and here’s the opinion. Justice Ginsburg was the lone dissenter.

Sue, 401(k)-holders, Sue!: In another closely watched case, the court granted individual 401(k) participants the right to sue plan administrators under ERISA for breach of fiduciary duty. Click here for the AP story; here for the opinion.

The language of the law refers to recovering money for the “plan” rather than for an individual, which raised the question of whether a participant can sue solely for himself. Justice John Paul Stevens, writing for the court, said that such lawsuits are allowed. “Fiduciary misconduct need not threaten the solvency of the entire plan to reduce benefits below the amount that participants would otherwise receive,” Stevens said.

Full post as published by Law Blog - WSJ.com on February 20, 2008 (boomark / email).