This article originally appeared in the Daily Journal on January 3, 2017.
If you’re a corporation and you lost a big case worth tens of millions of dollars in the U.S. Court of Appeals, having the U.S. Supreme Court — especially the business-friendly Roberts court — grant certiorari to review the decision is about as lucky a break as you could hope for.
But since “corporations are people, too” — like people — they may sometimes see their dreams dashed. The Supreme Court phrase for getting your litigation dreams dashed is having your case dismissed as improvidently granted (DIG). It happens rarely, and it’s often hard to guess exactly why, because the Supreme Court rarely explains why it DIGs cases. But earlier this year, the Supreme Court DIGged a major antitrust appeal by Visa, and did so in a way that offers lessons for all litigants in courts of discretionary review.
The Supreme Court, of course, has near-plenary discretion over its docket through the certiorari writ process. While the court must review a few cases under its original or appellate jurisdiction, the vast majority of cases come to it on discretionary petitions for writ of certiorari. The court spends weeks reviewing each cert petition and rejects about 99 percent of them.
With all the work that goes into picking cases, it makes sense that the court is loath to dismiss them. Much of the time, it’s the result of a jurisdictional problem that surfaced and wasn’t clear on the face of the petition, or because the court realizes a different issue than the one the petition aimed to address will ultimately decide the matter. The parties and amici spend significant time and money filing their briefs, and the court itself spends significant time reviewing briefs and preparing for argument. DIGing a case wastes all that time and money, and may leave the court with a hole in its calendar. Particularly with the frequent criticism of the court’s shrinking docket — the court hears only half as many cases as it did in the early 1980s — DIGs are often perceived as a gaffe, a sign the court didn’t do an adequate job of vetting the case before agreeing to hear it. You never want to be the clerk who recommends the court grant a cert petition it later has to DIG.
In Visa, Inc. v. Osborn, and a companion case Visa, Inc. v. Stoumbos, the court granted cert to decide an antitrust issue about the fees banks charge Visa and MasterCard users to withdraw cash from ATMs. Visa’s cert petition seeking review presented the question as whether an allegation that companies agreed to adhere to a business association’s rules (in this case, rules providing that banks must charge the same fee for ATM withdrawals to different cardholders) is sufficient to state a claim of antitrust conspiracy under federal law.
Between the grant of certiorari and the merits brief, Visa switched counsel, hiring one of Washington, D.C.’s most well-regarded Supreme Court litigators. Visa’s new lawyer, a former acting solicitor general, came up with a slightly different twist on the argument. Rather than argue that mere presence in a business association does not establish an antitrust conspiracy, Visa’s merits brief argued that a claim of antitrust conspiracy does not lie where businesses did not engage in concerted action through a business association.
That sort of subtle shift between a cert petition and a merits argument is quite common. While respondents before the court often complain about petitioners shifting their position from the question presented in the petition, minor variations on the same theme are usually part of the complex and intense process that comes with writing a Supreme Court brief. The court occasionally scolds advocates during oral arguments for perceived changes in position, but that’s about it.
Whatever the justices had for breakfast on November 17, however, must have left them especially ill-tempered. That’s when, the day after Visa filed its reply brief, the court DIGged both companion cases. “[H]aving persuaded us to grant certiorari on [one] issue . . . petitioners chose to rely on a different argument in their merits briefing,” the court’s short order explained. Indeed, that the justices explained the reason for the DIG was notable in itself.
The court is sending a straightforward message: dance with the one that brung ya. Supreme Courts are policy-driven courts, and they usually take cases because they want to resolve a conflict between lower courts that affects many other litigants than those immediately before it. The question to which the court grants review is the question it wants argued. The U.S. Supreme Court, at least, isn’t cutting anyone slack.
The California Supreme Court also has significant discretion in choosing its cases, and aims to resolve lower court conflicts that affect policy in a broad sense. It dismisses cases on review even more rarely than the U.S. Supreme Court — also using the acronym DIG — but in similar situations, such as when the justices realize there’s a defect in the appeal or the issue they originally wanted to discuss will end up as dicta. There too, it’s wise to stick to the arguments in the petition for review, though it’s hard to think of any time the California Supreme Court dismissed a case on review because the arguments in the briefing failed to line up precisely with those in the petition.
In lower appellate courts, which usually have mandatory appellate jurisdiction, the issue isn’t applicable. Those intermediate appellate courts may deem waived a clever new argument raised for the first time on appeal or in a reply brief, though they usually tolerate variations on a theme, but it’s hard to imagine that raising such an argument could cause a litigant to actually lose.
Ultimately, courts of discretionary review control their dockets. They pick the cases they want to hear, and they can unpick them too. Sometimes, clever new arguments occur to advocates after the technically correct time to raise them. With the Visa DIGs, the U.S. Supreme Court made clear that lawyers must resist the temptation to do so — at peril of seeing their clients’ litigation dreams dashed.
Appellate Zealots is a bi-monthly column on recent appellate decisions written by the attorneys of the California Appellate Law Group LLP*, an appellate boutique based in San Francisco. Ben Feuer is the chairman of firm, and handles civil and business appeals in the 9th Circuit and California Courts of Appeal. He is a former 9th Circuit law clerk and the longtime chair of the Appellate Section of the Bar Association of San Francisco’s Barristers Club. You can email him at email@example.com or find him at www.calapplaw.com.
*In July 2022, the California Appellate Law Group was renamed the Complex Appellate Litigation Group.
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