Forget Roe and the Framers. Let's Talk Business

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By Lorraine Woellert
Sunday, October 16, 2005

Conservative howling over Supreme Court nominee Harriet Miers echoes unabated since President Bush introduced his friend and confidant to the public on Oct. 3. If anything, the clamor has intensified, with some in the conservative chattering class now hounding Miers to withdraw. But while Bush dodges the brickbats, another critical element of the Republican political base is applauding from the wings.

That would be big business. For the first time in more than three decades, corporate America could find itself with not one, but two, Supreme Court allies with in-the-trenches industry experience -- Miers and newly minted Chief Justice John Roberts Jr. Don't be fooled by the low-key personas they have projected thus far; both are legal wonks who have packed a powerful punch in the corporate world. Together, they could be a CEO's dream team.

You wouldn't know it listening to the punditocracy, which is fixated on Miers's record -- or lack thereof -- on hot-button social issues. Bush is scrambling to quell this uprising by touting Miers's loyalty and Christian bona fides while the White House dispatches defenders to reassure his conservative base that she won't be Souter in a skirt.

Lost in the bitter brouhaha over abortion, gay marriage, God and the flag is another important facet of the Supreme Court debate: Miers has a blue-chip rsum that would wow Wall Street. Her record on constitutional issues is thin, but Miers's top-flight credentials in corporate law are attractive to the CEO-in-chief, who holds an MBA and was himself a businessman before being elected governor in Texas.

Her decades as a high-powered corporate litigator are just the beginning. She also has served on the corporate boards of a securities fund and a mortgage company. She's tackled the entire spectrum of commercial issues firsthand, defending Texas car dealers against price-fixing charges, challenging claims that Microsoft sold defective software, protecting Walt Disney's trademarks, and taking on consumers who sued mortgage companies for violating debt collection laws.

But, for the boardroom set, it's her work outside the courtroom that sets her apart. For years, Miers was a driving force in Texas for reforms that would protect industry from lawsuits. She helped elect reform-minded judges to the state bench, including longtime friend Nathan Hecht, a Texas supreme court justice who is derided by trial lawyers as the father of Texas tort reform. Until 2001, Miers was a director of the Committee for a Qualified Judiciary, a Texas political action committee devoted to electing conservative judges. In 1995, the pro-business Texas Civil Justice League hired her to press for caps on punitive damage awards and curbs on medical malpractice claims. It was a short-lived gig; Miers felt uneasy lobbying her former client, George W. Bush, who had just been elected governor. So she withdrew.

Still, that same year she urged Bush to veto legislation that would ban the state Supreme Court from limiting attorneys' fees, calling the bill "an assault" on a court that was in Republican hands for the first time. Bush took her advice. "She'll be a very strong judge for business interests," says Texas trial lawyer Fred Baron.

Of course, Roberts is no slouch, either. As a partner at Washington's Hogan & Hartson, he represented Toyota and Fox Broadcasting, penned briefs for the U.S. Chamber of Commerce, and regularly defended big business before the high court. As a circuit court judge, he took no pity on an endangered toad at risk of being bulldozed by California developers (nature lovers, save your tears -- the toad won).

Not since Justice Lewis F. Powell Jr. retired from the bench in 1987 have executives had even one high court justice with deep experience in the issues that govern American commerce. Antonin Scalia and Stephen G. Breyer built their reputations as law school professors. Sandra Day O'Connor and Clarence Thomas spent much of their careers in government. Ruth Bader Ginsburg was general counsel for the American Civil Liberties Union. William H. Rehnquist, Anthony M. Kennedy and David H. Souter worked for mid-size firms that weren't big players in corporate litigation. John Paul Stevens worked briefly as a corporate antitrust expert, but stopped practicing long before joining the high court.

If Miers is confirmed, she and Roberts could herald a sea change for corporate America. It's not that they'll necessarily be reliable "pro-business" votes, whatever that means. Their more immediate value to the business world would be their ability to recognize the significance of commercial questions that come to the court, and their ability to impress upon their fellow justices the need to hear cases that are critical to corporate America. They could provide two of the four votes needed for the Supremes to hear a case.

The late Chief Justice Rehnquist more or less satisfied the socially conservative agenda, voting most recently to uphold the constitutionality of the words "under God" in the Pledge of Allegiance. That case was right up his alley -- Rehnquist was happiest immersing himself in the foam of cosmic constitutional issues such as free speech and separation of church and state, touchstones for both the far right and far left. Few business conflicts are so high-minded. Most corporate questions that reach the Supreme Court are, to scholars and the public anyway, mundane and byzantine, often delving into the nuances and possible interpretations of mind-numbing federal statutes such as the Private Securities Litigation Reform Act or the Sherman Antitrust Act. One example: "What's 'restraint of trade'? Every contract restrains trade," says Quentin Riegel, vice president of litigation for the National Association of Manufacturers. "All principles of antitrust law are court made, so we need to be as clear as possible."

Rehnquist had little appetite for such questions, and a majority on the court apparently shared his sentiments. The Supreme Court hears fewer than 2 percent of the cases that come its way; of that 2 percent, very few have any importance for business. The snubbing has taken a toll. Business finds itself grappling with lingering circuit court splits on issues such as antitrust and pension regulation, a legal patchwork that has executives reaching for the Excedrin. And the pinstripes and wingtips continue to be frustrated with the court's chronic reluctance to interpret, once and for all, critical regulations such as the Americans With Disabilities Act. Miers and Roberts could help them out by urging the court to bring clarity and uniformity to a number of business-related issues.

Friends and peers trying to describe Miers and Roberts like to use the P-word -- pragmatic. That's sweet music to business ears: Corporations worship pragmatism and don't give a whit about judicial philosophy. But it's rank heresy to many on the right, who have had it up to here with jurists who weigh social and cultural mores when crafting opinions. Religious and other social conservatives want justices who will apply a very narrow "strict constructionist" interpretation to the Constitution and not read new rights -- such as the right to privacy found in Roe v. Wade -- into the framers' text.

Roberts already has disappointed them. "Judges take a more practical and pragmatic approach when deciding the rule of law," rather than sticking to a strict philosophy, he told the Senate Judiciary Committee. "The Framers were aware they were drafting for the future." Roberts also tipped his hat to the importance of legal precedent and the need to avoid enacting rapid and radical changes in law: "It is a jolt to the legal system to override precedent."

Translation: Roe might be here to stay, but business can take comfort. What corporate America wants from the judicial branch more than anything else is consistency and predictability -- tools for planning in the short term. That's one reason CEOs mourned the resignation of Sandra Day O'Connor. Legal scholars have scoffed at her philosophical inconsistency, but business execs lauded her practicality and her frequent acknowledgments of real-world situations in opinions that often made their 9-to-5 workday a little easier.

In her 24 years on the bench, O'Connor has voted to cut punitive damages, enforce arbitration agreements against consumers, and limit class-action lawsuits. She was the swing vote when the court blessed affirmative action programs in the 2003 ruling Grutter v. Bollinger . Citing legal briefs signed by General Motors, Procter & Gamble, and dozens of other companies, O'Connor noted the value of ethnic diversity in the workplace. "American businesses have made clear that the skills needed in today's increasingly global marketplace can only be developed through exposure to widely diverse people, cultures, ideas, and viewpoints," she wrote. Conservatives dismissed the opinion as touchy-feely legal lite, but business was thrilled.

Those who know Miers see her as having a similar bent. "Miers will be in the same class as Sandra Day O'Connor," says Ralph Wayne, president of the Texas Civil Justice League.

There's a lot at stake. For this term, the court already has accepted a smattering of antitrust, environmental and disability-rights cases. While having two jurists in the mold of O'Connor would be cause for celebration in the boardrooms of America, another Scalia or Thomas would be viewed as bad news. The two darlings of the socially conservative right have opposed the positions of the U.S. Chamber of Commerce twice as often as O'Connor, rejecting, for example, limits on punitive damages in a 1996 opinion that struck down a $2 million award against BMW of North America in a dispute over flawed paint. O'Connor was in the majority again in 2003 when the court reiterated its impatience with big damage awards in State Farm Mutual Automobile Insurance Co. v. Campbell . Among the dissenters were, yes, Scalia and Thomas, who could find no constitutional right to freedom from runaway jury awards.

Corporate America so far is nowhere to be found in the emotionally charged furor over Miers. That's because executives are loath to do anything that might turn off their politically diverse shareholders and customers, who might not appreciate their energy company or car manufacturer wading into a debate dominated by divisive issues such as abortion. Still, the Miers nomination has put in stark relief the wide rift between the religious right and the free-market right. Is Miers really Bush's "best choice" for the Supreme Court? That depends on where you stand. But if you're standing on Wall Street, the answer might be yes.

Author's e-mail:

woellert@businessweek.com

Lorraine Woellert is a correspondent for Business Week who covers legal issues from the magazine's Washington bureau.


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