Weekly litigation report — July 21, 2018

July 21, 2018 | By JAMES BURLING

Total victory in the Starry Night House mural caseRelated image

This week the City of Mount Dora settled with PLF plaintiffs Nancy Nemhauser and Lubomir Jastrzebski in a one-sided agreement that saves the family’s Van Gogh-inspired mural. The city agreed to drop its enforcement action and all fines, leaving the family free to complete the mural on their house and wall. The mural will then be grandfathered into any future Mount Dora ordinances. The city also agreed to revise its unconstitutional sign code—with help from an advisory committee that will include the homeowner—and pay $15,000 in attorney’s fees. Finally, the mayor of Mount Dora publically apologized to the family during a press conference Wednesday that was televised live and drew worldwide coverage. Read more on our blog here.

Idaho joins PLF’s fight to restore democratic oversight and accountability to the administrative state

PLF has brought a pair of lawsuits to enforce the Congressional Review Act against agencies that have stubbornly refused to comply with the law’s simple requirement that they submit their rules to Congress for review. Despite how easy it would be to comply, the agencies are instead asking the Court to rule that they can violate the law—and avoid democratic oversight—with impunity. Our fight to restore at least some measure of democratic accountability to the administrative state got a significant boost last week when the Governor of Idaho and the leaders of Idaho’s legislature joined our effort. The state’s endorsement of our case is a strong signal to both the agencies and the court of the seriousness of agency lawlessness. For more, check out our blog post.

Department of Interior proposes reform that will reduce conflict while boosting the incentives to recover endangered species

On Thursday, Interior announced several proposed reforms to the way it implements the Endangered Species Act. Chief among them is a return to the statute’s original approach of varying regulatory burdens according to the degree of threats a species faces—a change urged in several PLF rulemaking petitions. If finalized, this reform would not only benefit property owners but would also boost the rate at which we recover endangered species (which has historically been a depressing 3%). It would align the incentives of property owners with the interests of species by rewarding property owners who contribute to a species recovery with a gradual reduction in regulatory burdens. And it would promote a more collaborative approach to conserving and recovering rare species, rather than the conflict that has been so prevalent over the last 45 years. For more, see our blog post.

Ninth Circuit kicks First Amendment challenge discriminatory scholarship rule out of federal court

This week, in Armstrong v. Kadas, the Ninth Circuit held that Montana parents Jerry and Kathy Armstrong can’t litigate their federal First Amendment claim in federal court. The Armstrongs challenged a Montana rule that bars students attending religious schools from receiving privately funded scholarships through the state’s scholarship tax credit program. Under Montana law, taxpayers can claim a small tax credit if they donate money to a scholarship fund to help kids afford private school. But the state department of revenue passed a discriminatory rule that said students cannot use the scholarship funds to attend a religious school. The Armstrongs, who have a child attending a private religious school in Montana, challenged this rule as a violation of their First Amendment rights and their right to equal protection. On Thursday, a divided Ninth Circuit panel held that the federal courts don’t have jurisdiction over this constitutional claim because the lawsuit might somehow endanger state tax revenue. That decision is contrary to logic and clear Supreme Court precedent, a point we will make clear to the Court.

Super-independent agency challenged

Last week, PLF filed a friend-of-the court brief in CFPB v. All American Check Cashing, Inc., a case before the Fifth Circuit concerning whether the Consumer Financial Protection Bureau is constitutionally structured. The CFPB was created in response to the Great Recession and was intended to be a super-independent administrative agency. It is headed by a single director who, according to future-Justice Brett Kavanaugh, “enjoys more unilateral authority than any other official in any of the three branches of the U.S. Government[,]” except for the president. Despite this enormous power, the CFPB’s director is virtually unaccountable: he is appointed to a five-year term and may not be removed by the president except for cause. Under the Constitution, the president must “take Care that the laws be faithfully executed.” But by adopting the for-cause removal protection, Congress has encroached on the president’s executive authority to control executive-branch officers and thus unconstitutionally hampers the president’s ability to faithfully execute the laws. In our brief, therefore, we urge the Fifth Circuit should hold that the CFPB’s structure violates the Constitution’s Separation of Powers. For more see our blog post here.