Breyer stays on FERC case after stock sale
on Oct 16, 2015 at 12:24 pm
Justice Stephen G. Breyer will continue to take part in the Supreme Court’s review of a major energy policy case even though, when the Justices heard oral arguments in the case on Wednesday, his wife owned stock in a company that owns a firm directly involved in Federal Energy Regulatory Commission v. Electric Power Supply Association. The day after the hearing, that stock was sold.
Lawyers involved in the case were informed on Thursday by Scott S. Harris, the Clerk of the Court, that, after the sale, Breyer “has no reason to believe that the financial interest could be substantially affected by the outcome of the case.” As a result, Harris added, Breyer has “concluded that he should continue to participate in this case.”
The stock sale apparently occurred after Greg Stohr, a reporter for Bloomberg News, had contacted Breyer’s chambers about Joanna Breyer’s ownership of 750 shares of Johnson Controls, Inc. Johnson Controls owns EnergyConnect, Inc., which is directly involved in the case.
One Justice, Samuel A. Alito, Jr., had sat out the case on Wednesday and is not taking part because he, too, apparently owns Johnson Controls stock, according to the Bloomberg story.
Alito’s absence has raised the possibility, made to seem more real from the discussion at Wednesday’s hearing, that the remaining eight Justices could split four to four, unless some way to proceed to decide the merits could be worked out in private deliberations. Justice Breyer’s decision to remain involved — he noted that he had “devoted substantial judicial time to this case” — might be a hint that the Court’s members are determined to try to resolve the case on the legal issues at stake, rather than have it go off on a four-to-four split.
Such a split would simply uphold a federal appeals court decision against FERC, depriving that agency of a major part of the authority it has used to regulate the wholesale electricity market in the modern format that industry has adopted.
Ordinarily, judicial ethics rules require federal judges to avoid taking part in a case in which they have a financial interest that could be substantially affected by the outcome. While Harris’s letter to counsel suggested that Breyer had found no reason to believe that the stock interest could be affected significantly by the outcome, it did not give any reason for that conclusion.
The Clerk’s letter said that a search in Justice Breyer’s chambers for a potential conflict of interest — apparently made before Wednesday’s hearing — “inadvertently failed to find this potential conflict.”
It is up to individual Justices to make the choice about disqualifying themselves from a case.