The New Supreme Court Justice and His Impact on Your Business

The New Supreme Court Justice and His Impact on Your Business
Posted: Oct 9, 2018
Comments: 0

by Chris Heaton - Vice President for Advocacy and Public Affairs

I was around, as many of you were, when the name “Bork” became a verb and Clarence Thomas called his confirmation a “high-tech lynching.“ It was plain to anyone paying attention, that selecting a Supreme Court justice — when the ideology of the nominee shifts the potential outcome of decisions — would go beyond “advise and consent.”

The Brett Kavanaugh hearings went far beyond anything one could have imagined — and the significance of his confirmation will impact your business.

Having a fifth “conservative” justice on the Supreme Court, regarding all other issues that will come before the court, is much more likely to create a paradigm shift that will be felt well beyond the mid-term and next presidential elections.

For decades, Congress found it more expedient to write legislation that yields its policy making responsibility to regulatory agencies such as the FTC, FCC, DHS, IRS, etc.

Senator Ben Sasse (R-NE) referred to this abdication of congressional authority in his remarks about the current confirmation process and why it has become so important for the nominee to fit a political mold. In fact, the Supreme Court should have nothing to do with legislation, other than occasionally settling disputes and determining constitutionality of issues.

Senator Sasse was quite right when he called out Congress for being too lazy to write and pass laws the way the constitution intended. He correctly noted that since Congress has failed to do its job (setting policy through legislation), the Supreme Court has become the de facto policy maker for laws that do not accomplish what the framers intended. In other words, the Supreme Court has become an unelected super-legislature, adding even more significance to Justice Kavanaugh’s nomination.

Justice Kennedy was a pivotal “swing” vote on many issues and he was therefore considered essential for the balance of power that liberal groups felt was needed in the court (especially on social issues). But, with his retirement, that “swing” vote was in jeopardy. The past practice of Congress passing laws that yield much of its authority to the executive branch, via alphabet soup agencies, creates a crisis with those who rely on the courts to uphold regulations.

With Kavanaugh as a “solid conservative” on the court, the perceived and actual balance of power will be felt in significant ways that will impact not only the electronic security industry but virtually every industry that is regulated in some way. I expect more cases challenging the status quo for regulated industries will be heard and the Supreme Court is going to be much less likely to accept regulations on face value. The past deference of the court to regulatory agency judgement is going to be more closely scrutinized. As a result, members of Congress will be forced to confront the reality that the Supreme Court cannot be relied upon to do what could not be accomplished in Capitol Hill.

How this impacts the electronic security industry down the road will likely be felt on numerous fronts. For instance, the “net neutrality” issue is currently in the courts, with the Department of Justice recently filing of a suit against California over its passage of a sweeping net neutrality law and lawsuits filed against the FCC by states over its rescinding of the Obama-era net neutrality rules.

With a conservative majority, it is unlikely the court will uphold any net neutrality regulations that would put internet services into the regulatory framework that governs traditional wireline carriers. And, it is far less likely to uphold a state’s right to pass its own net neutrality statutes.

Occupational licensing and Department of Labor regulations that tend to favor labor unions will also likely receive less a favorable review from a more conservative court. In 2015, the Supreme Court ruled that the North Carolina Dental Examiners Board violated anti-trust laws because it was trying to regulate and shut down peripheral businesses that it felt encroached on its profession. This decision has given rise to numerous bills in states across the country that seek to enact “active supervision” of occupational licensing boards, with a goal of minimizing regulatory control. Having another “conservative” justice on the court will likely result in an expansion of this trend and many states that heavily regulate the electronic security industry may find their requirements outside the norms of a “least restrictive” regulatory framework.

Personal privacy and a wide array of other issues that relate to the Internet of Things (IoT) will also be treated with more scrutiny by a conservative court. Many states are now grappling with legislation that seeks to secure personal identifying information of consumers and maintain the security of “connected devices”. In this area of the law, conservative courts traditionally maintain a high regard for personal privacy, but the tendency to allow free markets to thrive through minimal regulation will likely create an interesting dynamic for the court.

These are just a few of the issues previously regulated more heavily through federal agencies with little statutory guidance from Congress.

For those who want to maintain the status quo, it will be incumbent upon Congress to provide more oversight and policy direction to regulatory agencies. For those who want to see the apple cart turned over and regulatory agency authority reduced, you most likely have a Supreme Court that will do just that.



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