President's weekly report — June 12, 2015

June 12, 2015 | By ROB RIVETT

California Supreme Court to rule on forced housing subsidies

We’re expecting a ruling on Monday in California Building Industry Association v. City of San Jose, the challenge to San Jose’s affordable housing mandate.  While it admitted that it had not shown that the construction of new homes creates a need for more subsidized low-income housing, the City is demanding that builders of 20 or more new market-priced homes set aside 15% of their new homes for lower-income residents or pay a whopping $122,000 per home in subsidies.  We believe this scheme is, in the words of the United States Supreme Court in Nollan and Koontz, “extortion.”

Victory in contract issue

The Texas Supreme Court issued this favorable decision today in Plains v. Torch, a case where the lower court had essentially rewritten a contract to make it seem more “fair” in divvying up a $43 million judgment. The award had arisen after the United States had breached a contract by not allowing drilling in coastal waters it had leased (and accepted money for) for oil exploration.  The issue here is who should get that award, with buyers and sellers of the lease claiming the money.  We had argued in this amicus brief, that the language of the contract itself should prevail rather than what seemed to be a more “fair” result to a judge.  Parties to a contract should have some certainty that the words they agree to will be binding, even if one of the parties might later wish for a different deal.  For more, see our blog post here.

Government seeks review of Hawkes

The federal government is asking the 8th Circuit to reconsider its ruling in Hawkes v. United States, the case where the circuit court properly held that a landowner has a right to challenge a wetlands jurisdictional determination. The court understood the hardship and unnecessary expense that would result if a landowner had to seek a permit that isn’t required in the first place. As our blog explains, we don’t think there is any justification for the government’s request for reconsideration.

Economic Liberty — Setbacks in Nevada

We had three setbacks in Nevada in our challenges to that state’s anti-competition laws.  First, the Governor vetoed SB 183, legislation that would have ended the patently unconstitutional requirement that new entrants into transportation businesses obtain the permission of their competitors and prove their new businesses would have no impact on competition.  He gave the pretext of health and safety, ignoring the fact that the legislation preserved all health and safety requirements, but would have only removed the competitor’s veto.

Second, in Castillo v. Ingram, our case challenging the requirement that private investigators have brick and mortar storefronts to operate in Nevada, the District Court dismissed our complaint on the grounds that because Castillo already has a license, he can’t challenge the licensing criteria. That would make sense except that we pointed out that he has to renew his license every year.

And third, the Ninth Circuit ruled that Maurice Underwood lacked standing to challenge an application process that he alleges is unconstitutional until he subjects himself to that process.  In other words he must first seek the permission of his competitors and somehow attempt to prove his business will not create competition before he can challenge these absurd requirements.

At-will-employment in Washington State

Oral argument held this week before the Supreme Court of Washington on two at-will employment cases, Rose v. Anderson Hay & Grain Co. and Rickman v. Premera Blue Cross, Inc. In Rose, a terminated employee brought a wrongful termination lawsuit despite the existence of a federal administrative remedy that could have made him whole.  In Rickman, a fired health care employee brought a wrongful termination suit because she claimed she was fired for suggesting a proposed (but never adopted) business plan was unlawful.  In fact she was fired for nepotism.  For more on these cases, see our blog post here.  See also our amicus briefs in these cases here and here.