Stay, Just a Little Bit Longer – SCOTUS Today
This post’s title comes from the 1960s doo-wop hit “Stay,” by Maurice Williams and the Zodiacs. I recognize that most practicing lawyers today are too young to know of this classic.
However, its opening line echoes in yet another action of the U.S. Supreme Court, today’s order in Noem v. Doe, granting a stay (for at least a bit longer) of a district court order that had blocked the deportation of more than a half million immigrants from Cuba, Haiti, Nicaragua and Venezuela.
Those persons were in the United States under parole programs that gave them temporary legal status. Today, the Court is allowing the Department of Homeland Security to deprive those persons of that protection and to subject them to deportation, notwithstanding that ongoing legal proceedings could lead to a restoration of the parole programs at issue.
Two dissenting Justices, Jackson and Sotomayor, did opine, but the Court’s order, as is the case with most “shadow docket” proceedings, contains no explanation of the majority’s reasoning. You will recall that on May 19, the Supreme Court issued a similar order regarding another program, in which the Court ended protection for 350,000 Venezuelans.
Citing that order, which by its own terms could evaporate pending future proceedings, is not intended to fuel the debate over the Trump administration’s immigration policy. Instead, it is to call attention to the dissenting opinion issued by Justice Jackson, who writes as follows:
When this Court evaluates whether or not to stay a lower court’s order, the factors we apply are well established: The applicant must show a fair prospect that we will grant certiorari and reverse, that the merits favor them, that irreparable harm will befall them should we deny the stay, and, in close cases, that the equities and public interest are on their side.
We don’t know the extent to which the Court’s majority actually considered each of these well-established criteria for a stay, but we do know that the government’s application did not produce any evidence of the important element of irreparable harm.
Justice Jackson claims, therefore, that “[t]he Court has plainly botched this assessment today.” Whether or not one agrees with that assessment, it appears that the Court is leaning toward an expansive view of presidential foreign affairs power. Future litigation will provide a definitive answer.
At present, more than three-quarters of a million South and Central American would-be refugees are vulnerable to deportation. And as any frequent reader of this blog—or of the news—should know, questions of administrative law are coming to dominate the Supreme Court’s docket.
The Tariff Roller Coaster: US Court of International Trade Invalidates Tariffs Imposed Under IEEPA, Only to Be Stayed by the Federal Circuit Court of Appeals
What Happened
On May 28, 2025, the US Court of International Trade (“CIT”) issued a major decision in V.O.S. Selections, Inc. v. United States invalidating two sweeping tariff programs imposed under the International Emergency Economic Powers Act (“IEEPA”) earlier this year. The decision strikes down the legal basis for key executive orders imposing tariffs on China, Canada, Mexico and dozens of other trading partners, reshaping the legal framework for future emergency-based trade actions. The court granted summary judgment in favor of both private-sector plaintiffs and a coalition of state governments, concluding that the tariff actions exceeded statutory authority under IEEPA and intruded upon Congress’s exclusive constitutional role in regulating trade.
However, less than 24 hours later, the Federal Circuit Court of Appeals issued an order administratively staying the CIT injunction while it considered an appeal on the case. Thus, notwithstanding the CIT order, the IEEPA tariffs remain in effect.
Background
IEEPA is a federal law that grants the President broad powers to regulate international commerce after declaring a national emergency in response to an unusual and extraordinary threat to the national security, foreign policy or economy of the United States. Typically, IEEPA has been used to impose sanctions on foreign states or individuals, control assets or restrict financial transactions in response to specific foreign threats. IEEPA’s authority traditionally has not been used to impose broad tariffs simply based on general economic concerns.
Since taking office in January 2025, President Trump has implemented a series of tariffs under IEEPA rather than by using traditional trade enforcement statutes such as Section 301 or Section 232 of the Trade Expansion Act of 1962.
These IEEPA tariffs include:
Trafficking tariffs: A 25 percent ad valorem duty on goods from Mexico and Canada and a 20 percent duty on goods from China, justified on grounds of transnational criminal threats and border security (see previous alert here).
Worldwide and retaliatory tariffs: A 10 percent baseline duty on all imports, with increased rates up to 50 percent for certain US trading partners, based on allegations of non-reciprocal trade policies and structural global imbalances (see previous alerts here and here).
Both types of tariffs were implemented via executive orders invoking national emergency declarations under IEEPA.
Key Legal Holdings
The CIT ruled that:
IEEPA does not authorize boundless tariff authority. The court narrowly interpreted IEEPA’s grant of power to “regulate . . . importation,” holding that it does not encompass the imposition of broad, discretionary tariffs absent a defined emergency directly tied to foreign threats.
The tariffs were ultra vires. The court found that the President’s actions exceeded the legal authority granted by Congress under IEEPA, effectively encroaching upon powers specifically reserved for Congress under Article I of the US Constitution to regulate trade.
IEEPA requires a foreign emergency nexus. The court concluded that generalized economic concerns—such as trade deficits, wage suppression abroad or retaliatory trade practices—do not meet IEEPA’s strict requirement of an “unusual and extraordinary threat” arising, outside the United States. This holding significantly narrows the executive’s discretion in declaring emergencies for trade purposes, emphasizing that the threat must be directly tied to foreign actions impacting national security or foreign policy, not merely economic competition.
Private and state plaintiffs had standing. The court recognized downstream economic harm (e.g., increased procurement costs, disrupted supply chains) as sufficient to establish standing, even for non-importers.
Impact and Effective Scope of the Ruling
The CIT’s judgment is nationwide in scope and normally would be immediately effective. Because the CIT invalidated the relevant executive orders and related Harmonized Tariff Schedule of the United States (HTSUS) modifications, the ruling would have had the practical effect of nullifying the challenged tariffs as a matter of law. However, the Federal Circuit’s administrative stay of the CIT injunction means that:
The tariffs remain in effect for now, pending further action by the appellate court.
The administrative stay is temporary and does not decide the appeal itself, but it preserves the status quo while the court considers the government’s full motion for a stay pending appeal.
Plaintiffs must respond to the government’s stay motion by June 5, 2025, with a reply due June 9, 2025.
Parties have been instructed to notify the Federal Circuit of any ruling on the parallel stay motion still pending before the CIT.
Unless and until the Federal Circuit denies the government’s stay request or the CIT separately lifts the stay, businesses should treat the tariffs as still in force.
Importantly, neither the CIT nor the Federal Circuit order affect product-specific tariffs imposed under other authorities, such as Section 232 of the Trade Expansion Act of 1962. Tariffs on imports of aluminum, steel and certain automotive goods remain in force and are unaffected by these rulings.
Issues Potentially to Be Raised on Appeal
The government is widely expected to appeal the CIT’s decision to the Federal Circuit. Key legal questions likely to be raised on appeal include:
Scope of IEEPA authority: Whether the phrase “regulate . . . importation” authorizes tariff actions, particularly considering precedent under the Trading with the Enemy Act. The government is likely to argue that “regulate . . . importation” within IEEPA is a broad grant of power that includes the imposition of tariffs, citing historical precedent under the Trading with the Enemy Act (e.g., United States v. Yoshida Int’l, Inc., 526 F.2d 560 (C.C.P.A. 1975)) to support a more expansive view of presidential authority during emergencies.
Use of constitutional avoidance: Whether the CIT erred by interpreting IEEPA narrowly based on the nondelegation and major questions doctrines, rather than on plain statutory text.
Justiciability of emergency declarations: Whether the judiciary may review the President’s determination that a national emergency exists for IEEPA purposes. The government may contend that the President’s determination of a national emergency for IEEPA purposes is a political question and thus generally not subject to judicial review, arguing that the CIT overstepped its bounds in scrutinizing this executive determination.
APA applicability: Whether the CIT improperly imported Administrative Procedure Act (APA) standards in reviewing executive action not subject to the APA.
Standing of non-importers: Whether downstream purchasers without direct duty liability can challenge tariff actions under 28 U.S.C. § 1581(i).
The Federal Circuit’s treatment of these issues could have long-term effects on the balance of power between Congress and the executive branch in trade law and emergency economic policy.
Next Steps for Businesses
Businesses affected by the invalidated tariffs should:
Monitor for further court action, including whether the CIT grants or denies the pending stay motion, and any orders from the Federal Circuit on the full stay request.
Adjust forward-looking import planning to reflect the possibility of the tariffs being rolled back if the stay is lifted or the appeal is denied.
Monitor CBP implementation guidance. Companies should pay close attention to forthcoming communications from US Customs and Border Protection (CBP), particularly via Cargo Systems Messaging Service (CSMS) announcements, which are typically published on the CBP website. CBP has used CSMS in the past to communicate implementation steps in response to major litigation.
Importers should proactively review their Automated Commercial Environment (ACE) accounts and coordinate closely with their customs brokers to identify affected entries, assess potential refund claims and remain responsive to any agency developments or requests for information.
The Swiss Federal Supreme Court Bans References to Animals in Plant-based Foods
On May 2, 2025, the Swiss Federal Supreme Court ruled that designations referring to animal species are not allowed to label plant-based meat substitutes (here is the official press release, in French, 2C_26/2023). The full judgment is not yet available, so we cannot provide a more in-depth analysis of the arguments of Switzerland’s supreme judges, and the information below is based solely on the press release.
In 2021, the Zurich Cantonal Laboratory banned a company from labelling its pea protein meat substitutes with names referring to animal species; the company appealed this ban, and the Administrative Court of the Canton of Zurich decided in its favor in 2022, allowing the use of references to animal meat in its products. However, in its judgment of May 2, 2025, the Federal Supreme Court upheld the appeal filed by the Federal Department of Home Affairs, annulling the first instance decision of the Zurich Administrative Court and thus ruling against the company.
According to the press release, food products destined for consumers made exclusively with vegetable proteins (i.e., those usually defined as ‘plant-based meat’) cannot be designated by names of animal species, even if these are accompanied by an indication specifying the vegetable origin of the product, such as ‘planted chicken,’ ‘chicken-like,’ ‘pork-like,’ ‘vegan pork,’ or ‘vegan chicken.’ In fact, the term ‘chicken’ refers to poultry; therefore, it cannot be used for products that do not contain a meat component, as it would be misleading for consumers. In other words, plant-based products alternative to meat must be labelled in such a way as to enable the consumer to recognize the type of foodstuff and to differentiate it from products that they aim to substitute.
“A Course Correction”: Supreme Court Reinforces Agency Deference and Narrows the Scope of Environmental Effects that Agencies Must Consider Under NEPA
On May 29, 2025, the Supreme Court held that the National Environmental Policy Act (NEPA) — which requires federal agencies to analyze the environmental impacts of projects that they carry out, fund, or approve — does not require agencies to consider the effects of “other future or geographically separate projects that may be built (or expanded) as a result of or in the wake of the immediate project under consideration.” The Court’s decision narrows the scope of effects that agencies must consider under NEPA, provides clear direction to agencies and lower courts, and will likely benefit developers of infrastructure and other projects that require federal agency approvals or receive federal funding.
Background
In this case, Seven County Infrastructure Coalition v. Eagle County, Colorado, Eagle County and several environmental groups challenged the adequacy of the environmental impact statement (EIS) that the Surface Transportation Board (STB) prepared for its approval of the construction of a new 88-mile railroad line that would connect Utah’s oil-rich Uinta Basin to the national railway network. The petitioners claimed that the EIS should have analyzed in greater detail the project’s so-called “upstream” impacts of increased oil production in the Uinta Basin and the so-called “downstream” impacts of increased oil refining in the Gulf Coast. The petitioners argued that these upstream and downstream environmental impacts would foreseeably result from easier transportation of crude oil along the new railroad line. The D.C. Circuit Court of Appeals agreed with the petitioners, holding that the STB “impermissibly limited its analysis of upstream and downstream projects” and that the environmental effects from increased oil production and refining were “reasonably foreseeable impacts” of the new railroad line that the EIS should have analyzed in greater detail.
The Supreme Court’s Decision
The Supreme Court, in an opinion authored by Justice Kavanaugh, reversed the D.C. Circuit. The Court’s decision rested on two main pillars: (1) federal agencies are owed “substantial judicial deference” in defining the scope and level of detail of an EIS, and (2) NEPA does not require an agency to consider the effects of other projects that are separate in time or place.
The Court began its opinion by emphasizing that courts reviewing an EIS for compliance with NEPA must give “substantial deference” to the agency. The Court reiterated some well-known principles from its canon of NEPA and Administrative Procedure Act cases over the past five decades, including that NEPA is a “purely procedural statute” that places “no substantive constraints” on an agency’s ultimate decision to approve or deny a project, and that a court’s only role is to determine “whether the agency action was reasonable and reasonably explained.” Drawing on this precedent, the Court explained that courts should uphold agencies’ decisions regarding the scope and content of an EIS — such as what the project’s likely impacts are, the extent to which direct and indirect impacts are discussed, what alternatives are considered, and whether effects from other projects are analyzed — “so long as they fall within a broad zone of reasonableness.” In this regard, the Court lamented that some lower courts have “not applied NEPA with the level of deference demanded by the statutory text and this Court’s cases,” thus transforming NEPA “from a modest procedural requirement into a blunt and haphazard tool employed by project opponents.” The Court noted that judicial review under NEPA had strayed so far out of line with “statutory text and common sense” that a “course correction of sorts is appropriate.”
In the second part of the opinion, the Court held that “when the effects of an agency action arise from a separate project — for example, a possible future project or one that is geographically distinct from the project at hand — NEPA does not require the agency to evaluate the effects of that separate project.” The Court clarified that NEPA “can sometimes” require analysis of the proposed project’s effects that are later in time or geographically removed (so-called indirect effects), but not other projects’ effects. The Court repeated a refrain from the first part of its opinion, stating that an agency must have the ability to “draw what it reasonably concludes is a manageable line” between the effects of the project at hand and some future project separate in time or place. This principle is necessary to prevent a “relatively small infrastructure project” from turning into a “scapegoat for everything that ensues from upstream oil drilling to downstream refinery emissions.” The Court found that the line drawn by the STB was reasonable and that the D.C. Circuit erred in requiring analysis of the effects of upstream and downstream projects of the railroad line.
Implications
The Court’s decision is a win for project developers and federal agencies because it provides a relatively clear rule limiting the scope of indirect effects that agencies must consider under NEPA to only those effects of the project under consideration.
In this respect, the Court’s decision represents a significant departure from prior NEPA practice. Agencies and courts have long understood NEPA to require some consideration of indirect or secondary effects that are reasonably foreseeable. This principle is rooted in the Council on Environmental Quality’s (CEQ) guidance documents issued in the early years after NEPA was enacted in 1970 and was carried forward in CEQ’s subsequent (and recently rescinded) regulations. (For example, for all but two years since 1978, CEQ’s regulations required analysis of “growth inducing effects and other effects related to induced changes in the pattern of land use, population density or growth rate, and related effects on air and water and other natural systems, including ecosystems.” (40 C.F.R. § 1508.8(b) (1978); 40 C.F.R. § 1508.1(g)(2) (2022); 40 C.F.R. § 1508.1(i)(2) (2024).)) Courts and agencies have struggled to consistently demarcate the contours of indirect effects that must be considered (i.e., what effects are reasonably foreseeable). Litigation on this topic has picked up in the past decade around whether agencies must consider the upstream and downstream effects (including climate change impacts) of projects involving development or transportation of fossil fuels.
The Court’s ruling in Seven County largely settles the debate regarding upstream and downstream effects by creating a relatively clear rule for agencies and courts to follow: The effects of other projects that may result from the project under consideration are not reasonably foreseeable and, therefore, need not be analyzed under NEPA. Still, disputes may continue to arise over which indirect effects of a proposed action are reasonably foreseeable and still must be considered, particularly in light of the Court’s ambiguous statement that NEPA “can sometimes” require analysis of a project’s indirect effects. In addition, the “broad latitude” that agencies have in carrying out NEPA can swing both ways, depending on the administration: The Seven County decision appears to leave the door open to allowing agencies to consider the effects of other projects removed in time and place if they so choose (even though it is not required), so long as such choices around which effects to analyze and whether to analyze the effects of other projects are “reasonable and reasonably explained.”
The Seven County decision should put federal agencies and project developers in a better position to prevail in NEPA lawsuits. The decision sends a strong message to federal courts that federal agencies have considerable discretion in conducting environmental reviews under NEPA, particularly regarding decisions on where to “draw the line” for the scope and contents of the analysis. And although dicta (i.e., not part of the Court’s holding), a passage in the Court’s opinion suggests that courts should exercise restraint in setting aside an agency’s approval of a project even when they find the agency violated NEPA: “The ultimate question is not whether an EIS in and of itself is inadequate, but whether the agency’s final decision was reasonable and reasonably explained. Review of an EIS is only one component of that analysis. Even if an EIS falls short in some respects, that deficiency may not necessarily require a court to vacate the agency’s ultimate approval of a project, at least absent reason to believe that the agency might disapprove the project if it added more to the EIS.”
While the first part of the Seven County opinion (regarding the substantial deference courts owe to agencies’ compliance with NEPA) did not necessarily tread new legal ground, its discussion of how NEPA litigation has led to fewer and more expensive infrastructure projects is likely to resonate with many project developers and may influence future legislative and regulatory attempts at NEPA and permitting reform. The Court observed that “overly intrusive (and unpredictable)” lower court rulings “have slowed down or blocked many projects and, in turn, caused litigation-averse agencies to take ever more time and to prepare ever longer EISs for future projects.” As a result, “[f]ewer projects make it to the finish line. Indeed, fewer projects make it to the starting line. Those that survive often end up costing much more than is anticipated or necessary, both for the agency preparing the EIS and for the builder of the project. And that in turn means fewer and more expensive railroads, airports, wind turbines, transmission lines, dams, housing developments, highways, bridges, subways, stadiums, arenas, data centers, and the like. And that also means fewer jobs, as new projects become difficult to finance and build in a timely fashion. A 1970 legislative acorn has grown over the years into a judicial oak that has hindered infrastructure development under the guise of just a little more process.”
The Court’s decision comes amid what is arguably the biggest upheaval of NEPA practice in the law’s 55-year history. Last month, CEQ rescinded its implementing regulations, which had provided consistent and judicially enforceable rules applicable to all federal agencies in one form or another since 1978. As soon as next month, individual agencies are expected to publish new rules for implementing NEPA, which may curtail the scope of analysis and public participation in the NEPA process. And this all comes on the heels of the 2023 Fiscal Responsibility Act, which included the most significant statutory amendments to NEPA since it was enacted in 1970.
China’s Supreme People’s Court Designates Generative AI Case as Typical
On May 26, 2025, China’s Supreme People’s Court (SPC) released the “Typical cases on the fifth anniversary of the promulgation of the Civil Code” (民法典颁布五周年典型案例) including one generative AI case in which the Beijing Internet Court held that an AI-generated voice infringed a dubber’s personality rights. Note that while China is not a common law country, designating a case as a Guiding Case or Typical Case is somewhat analogous to a U.S. Court marking a case as precedential in that the SPC is indicating to lower courts to adjudicate future cases in accordance with this decision.
As explained by the SPC:
IV. Protecting voice rights according to law and promoting the development of artificial intelligence for good – Yin v. Beijing smart technology company and others’ infringement of personality rights case
1. Basic Facts of the Case
The plaintiff, Yin XX, is a dubbing artist. He found that the works produced by others using his dubbing were widely circulated in many well-known apps. After tracing the source, the sound in the above works came from the text-to-speech product on the platform operated by the defendant, a Beijing intelligent technology company. Users can convert text into speech by entering text and adjusting parameters. The plaintiff was commissioned by the defendant, a Beijing cultural media company, to record a sound recording, and the defendant was the copyright owner of the sound recording. Later, the defendant provided the audio of the sound recording recorded by the plaintiff to another defendant, a software company, and allowed the defendant to use, copy, and modify the data for commercial or non-commercial purposes for its products and services. The other defendant only used the sound recording recorded by the plaintiff as the material for AI processing, generated the text-to-speech product involved in the case, and sold it on the cloud service platform operated by yet another defendant, a Shanghai network technology company. The defendant, the Beijing intelligent technology company, signed an online service sales contract with the defendant, a Beijing technology development company, and another defendant placed an order with the defendant, which included the text-to-speech product involved in the case. The defendant, a Beijing intelligent technology company, adopted the form of an application program interface, and directly retrieved and generated the text-to-speech product for use on its platform without technical processing. Yin filed a lawsuit in court, requesting that defendant one, a Beijing intelligent technology company, and defendant three, a software company, immediately stop infringing and apologize, and that the five defendants compensate Yin for economic and mental losses.
(II) Judgment Result
The effective judgment holds that the voice right is a personal interest and concerns the personal dignity of natural persons. For the voice processed by artificial intelligence technology, as long as the general public or the public within a certain range can identify a specific natural person based on the timbre, intonation and pronunciation style, the voice right of the natural person can extend to the AI voice. The above five defendants all used the plaintiff’s voice without the plaintiff’s permission and committed acts that infringed the plaintiff’s voice rights, constituting an infringement of the plaintiff’s voice rights. Because the infringing products involved in the case have been removed, the five defendants will no longer be ordered to bear the tort liability of stopping the infringement. Instead, based on the plaintiff’s request, the subjective fault of each defendant and other factors, the court ruled that the first defendant, a Beijing intelligent technology company, and the third defendant, a software company, apologize to the plaintiff, and the second defendant, a Beijing cultural media company, and the third defendant, a software company, compensated the plaintiff for losses.
(III) Typical significance
General Secretary Xi Jinping emphasized: “We must strengthen the research and prevention of potential risks in the development of artificial intelligence, safeguard the interests of the people and national security, and ensure that artificial intelligence is safe, reliable and controllable.” With the rapid development of artificial intelligence technology, voice forgery and imitation are becoming increasingly common, and disputes involving infringement of personality rights caused by related technologies are also increasing. my country has written “voice” protection into the Personality Rights Code of the Civil Code in the form of legislation, reflecting respect for the rights and interests of natural persons’ voices, as well as a positive response to technological development and social needs. In this case, the People’s Court determined in accordance with the law that voice, as a kind of personal right, is person-specific. Unauthorized use or permission for others to use the voice in a recording without the permission of the right holder constitutes infringement, which sets the boundaries of behavior for the application of new formats and new technologies, and helps to regulate and guide the development of artificial intelligence technology in the direction of serving the people and doing good.
(IV) Guidance on the provisions of the Civil Code
Article 1018
A natural person enjoys the right to likeness and is entitled to make, use, publicize, or authorize others to use his image in accordance with law.
The likeness is an external image of a specific natural person reflected in video recordings, sculptures, drawings, or on other media by which the person can be identified.
Article 1019
No organization or individual may infringe upon other’s rights to likeness by vilifying or defacing the image thereof, or through other ways such as falsifying other’s image by utilizing information technology. Unless otherwise provided by law, no one may make, use, or publicize the image of the right holder without his consent.
Without the consent of the person holding the right to likeness, a person holding a right in the works of the image of the former person may not use or publicize the said image by ways such as publishing, duplicating, distributing, leasing, or exhibiting it.
Article 1023
For an authorized use of another person’s name or the like, the relevant provisions on the authorized use of other’s images shall be applied mutatis mutandis.
For the protection of a natural person’s voice, the relevant provisions on the protection of the right to likeness shall be applied mutatis mutandis.
The original text, including five other Civil Code Typical Cases, can be found here (Chinese only).
Court of International Trade Sets Aside Presidential IEEPA Tariffs and Federal Circuit Postpones Nationwide Injunction
A three-judge panel of the United States Court of International Trade (“CIT”) issued a landmark decision on May 28, 2025, in V.O.S. Selections, Inc. v. United States,[1] concluding that tariffs imposed by the President under the International Emergency Economic Powers Act (“IEEPA”) exceeded the President’s statutory authority. The court vacated the challenged tariff orders and permanently enjoined their operation nationwide. However, the U.S. Court of Appeals for the Federal Circuit less than twenty-four hours later temporarily stayed the lower court’s order, pending a decision on a more permanent stay until all appeals conclude. Accordingly, the President’s tariffs are presently preserved, as the lower court’s decision has been stayed. A second decision by the D.C. District Court, a different federal court, also held the President’s IEEPA tariffs are beyond the scope of the statute and imposed a more limited injunction for two parties.[2]
These rulings do not affect other tariff measures taken by the Trump Administration, such as section 232 duties against steel and aluminum, and automobiles.
Background
Since January 2025, the President has declared several national emergencies and imposed a range of tariffs on imports from its trading partners. These included:
Worldwide and retaliatory tariffs consisting of a rate of 10 percent on all imports from all U.S. trading partners, with higher rates for certain countries, as a response to persistent U.S. trade deficits and alleged unfair trade practices.
Country-specific tariffs consisting of a 25 percent duty on Canadian and Mexican products (10 percent on Canadian oil and potash) and a 20 percent duty on Chinese products. These were implemented to address declared threats “to the safety and security of Americans, including the public health crisis of deaths due to the use of fentanyl and other illicit drugs” from international cartels, drug trafficking, and related criminal activity.
Multiple states and businesses challenged these tariffs, arguing that the President had exceeded his authority granted by IEEPA and that the actions violated important constitutional principles.
Key Legal Findings
The CIT held that IEEPA does not grant the President unlimited tariff authority. While the statute allows the President to “regulate . . . importation” in response to an “unusual and extraordinary threat” following a declared national emergency, the court held that this language does not authorize the imposition of unbounded tariffs. The court emphasized that any delegation of tariff authority to the President must be clearly limited and guided by an “intelligible principle” to avoid violating the separation of powers. The court also explained that the current tariffs are distinguishable from prior, more limited uses of emergency powers, noting that the challenged tariffs lacked meaningful limitations in scope or duration, effectively entailing unlimited Presidential authority.
The court held that the worldwide and retaliatory tariffs were unbounded by any limitation in duration or scope and, accordingly, ultra vires and contrary to law.
It also held that the country-specific tariffs failed to comply with IEEPA because the statute requires that emergency powers be exercised only to “deal with an unusual and extraordinary threat” and there is no direct connection between the tariffs and the stated threat. Rather, the tariffs were used as leverage in negotiating a solution, which the statute does not contemplate.
The D.C. District Court found that IEEPA does not support the President’s tariffs, and the implementing agency violated the Administrative Procedure Act, but declined to reach arguments specific to the President’s tariffs and IEEPA. It remains to be seen which court will ultimately have jurisdiction, as both have held that they do.
Pending Relief
Though the CIT vacated the President’s tariff orders and permanently enjoined their enforcement nationwide, the Federal Circuit’s administrative stay, pending resolution of the government’s motion to stay pending appeal, postpones the lower courts actions. The tariffs, accordingly, remain in effect for the moment. If implemented, the CIT’s decision would have far-reaching consequences for anyone dealing with merchandise exported into the United States. Practically speaking:
All tariffs imposed under the challenged executive orders would be set aside, and importers would no longer be subject to the additional duties previously in effect under these orders.
The decision indicates that the President’s authority to impose tariffs under IEEPA is not open-ended and must be exercised within clear statutory and constitutional boundaries.
The decision also signals that future attempts to use IEEPA to impose broad tariffs—especially in response to trade deficits or as general leverage—will likely face significant judicial scrutiny.
Next Steps and Key Takeaways
In addition to the Federal Circuit’s quick action to administratively stay the CIT’s order, the government has already appealed the CIT’s decision. Given the fluidity of the current situation, importers and affected parties should monitor developments closely and consult with counsel regarding the status of the ongoing litigation and any duties paid under the relevant tariffs and potential refund procedures. It is also important to recognize that IEEPA is not the sole mechanism available to the Trump Administration for imposing tariffs. Tariffs implemented on steel, aluminum, autos, and potentially future products under “Section 232” investigations are not covered by this decision.
Despite the superior court’s stay, the lower courts’ decisions mark a significant statement of congressional control over tariff policy and, until the appellate courts decide, a limitation on the use of IEEPA to regulate importation.
[1] https://www.cit.uscourts.gov/sites/cit/files/25-66.pdf
[2] https://www.courthousenews.com/wp-content/uploads/2025/05/contreras-blocks-certain-trump-tariffs.pdf
Supreme Court Significantly Scales Back Scope of NEPA Review for Infrastructure Projects
Through a unanimous 8-0 decision, the Supreme Court of the United States addressed what it described as “continuing confusion and disagreement in the Courts of Appeals” over the scope of judicial review for claims asserting violations of the National Environmental Policy Act (NEPA). Seven County Infrastructure Coalition v. Eagle County, No. 23-975 (May 29, 2025). In doing so, the Supreme Court clarified that decisions by federal agencies under NEPA are entitled to substantial deference, and courts should not be in the business of second-guessing how agencies weigh competing considerations under NEPA. “The bedrock principle of judicial review in NEPA cases can be stated in a word: Deference.” Additionally, the Supreme Court ruled that NEPA does not compel federal agencies to address the environmental effects of projects separate in time or place from the construction and operation of the proposed project at issue.
Justice Kavanaugh authored the main opinion joined by Justices Alito, Thomas, and Barrett along with Chief Justice Roberts. Justice Sotomayor penned a separate concurring opinion joined by Justices Kagan and Jackson. Justice Gorsuch did not participate in the case.
Rail Project at Issue
In December 2021, the federal Surface Transportation Board approved an application to construct an 88-mile rail line in Utah’s Uinta Basin that would primarily transport crude oil to interstate rail lines and ultimately to refineries along the Gulf Coast.
NEPA required the Board to evaluate environmental impacts of the proposed project and consider potential alternatives to the project that would avoid or minimize those impacts. The Board’s NEPA evaluation was reflected in an Environmental Impact Statement (EIS) spanning more than 3,600 pages. Several non-governmental organizations and a local county filed a legal challenge under NEPA in the District of Columbia Circuit Court of Appeals, alleging that the Board failed to adequately consider the impacts of certain “upstream and downstream” activities that are separate from the proposed rail line. Specifically, the Board did not perform a detailed analysis of (1) increased crude oil development that may occur in the Uinta Basin once the rail line goes into service; or (2) air emissions at refineries along the Gulf Coast associated with processing crude oil extracted from the Uinta Basin.
Court of Appeals Decision
Finding in favor of the challengers, the D.C. Circuit agreed that future crude oil development and refining were “reasonably foreseeable impacts” that the Board should have evaluated. The D.C. Circuit rejected the Board’s position that those effects arose from other projects that were separate in time and space from the rail line and were also beyond the jurisdiction of the Board, which does not regulate crude oil extraction or refining.
Kavanaugh Opinion
The main court opinion makes clear that judicial review under NEPA involves affording substantial deference to the decisions by the federal agencies involved. That is because assessment of environmental effects and feasible alternatives involves “a series of fact-dependent, context-specific, and policy-laden choices.” Thus, courts “should afford substantial deference and should not micromanage those agency choices so long as they fall within a broad zone of reasonableness.” Nevertheless, Justice Kavanaugh observed that “[s]ome courts have strayed and not applied NEPA with the level of deference demanded by the statutory text and this Court’s cases.” In doing so, “NEPA has transformed from a modest procedural requirement into a blunt and haphazard tool employed by project opponents (who may not always be entirely motivated by concern for the environment) to try to stop or at least slow down new infrastructure and construction projects.”
Kavanaugh’s opinion wholly rejects the notion that NEPA requires federal agencies to consider other existing or potential future projects that are separate in space and time from the proposed project under consideration. The opinion observes that NEPA’s focus is the “project at hand – not other future or geographically separate projects that may be built (or expanded) as a result of or in the wake of the immediate project under consideration.” Consequently, “NEPA does not require the agency to evaluate the effects of that separate project.” The Board was therefore “[a]bsolutely correct” in concluding that it need not perform a detailed analysis of the potential for future crude oil development in the Uinta Basin and refining activities along the Gulf Coast.
Lastly, Kavanaugh observed that NEPA litigation should not be a forum for project opponents “to air their policy objections to proposed federal actions.” “Citizens may not enlist the federal courts, ‘under the guise of judicial review’ of agency compliance with NEPA to delay or block agency projects based on the environmental effects of other projects separate from the project at hand.”
Concurring Opinion
The concurring opinion authored by Justice Sotomayor and joined by Justices Jackson and Kagan observes that the Board lacked jurisdiction over potential future crude oil development and refinery activities, and lacked authority to restrict transportation of crude oil on the proposed rail line. Therefore, there was no need for the Board to consider impacts of those activities.
What’s Next?
NEPA has been called one of the most litigated environmental statutes in the United States. This decision should set a higher bar for project opponents to succeed on NEPA claims. The Court made clear that the judiciary should afford substantial deference to how federal agencies weigh the respective impacts and benefits of a proposed project. Whether this pronouncement will prompt developers to move forward with additional projects, and how much deference will actually be afforded by the lower courts, remains to be seen. This decision does not directly affect the legal landscape for challenges brought under substantive environmental statutes like the Clean Water Act, Clean Air Act, or Endangered Species Act, although actions challenging major projects that allege violations of these statutes are often paired with a NEPA claim.
GET YOUR FAX STRAIGHT: Court Grants Class Certification In TCPA Fax Blast Case
Hey TCPAWorld!
Litigation is a pursuit of the truth, and the truth has a way of resurfacing—often from the same hands that tried to bury it.
In Loop Spine & Sports Ctr., Ltd. v. Am. Coll. of Med. Quality, No. 22 CV 4198, 2025 WL 1446504 (N.D. Ill. May 20, 2025), Loop Spine & Sports Center, Ltd. (“Plaintiff”), an Illinois chiropractic and sports injury company, sued American College of Medical Quality, Inc. (“ACMQ”), Affinity Strategies, and a former ACMQ executive, Daniel McLaughlin (collectively, the “Defendants”) for sending an unsolicited fax promoting a medical conference, alleging violations under the TCPA.
Plaintiff sought certification and the motion was granted.
Background
Here’s the rundown. ACMQ engaged McLaughlin, who then enlisted Jim Dodge (McLaughlin’s acquaintance) and Michael Henry (who is in the business of distributing faxes), to promote its 2022 “Care After Covid” conference via a “blast fax” campaign to doctors in the Chicago area. Id., at *2. Together, the group compiled 13,850 contacts to reach. Plaintiff was a recipient of one of the faxes and subsequently sued.
The parties disagree on two substantive factual issues related to class certification: (1) how many faxes were actually sent, with Plaintiff contending at least 6,500, while Defendants assert 28, and (2) whether Plaintiff or other putative class members provided permission for the fax. Defendants assert that Henry called Plaintiff, spoke to an employee, and obtained oral consent before sending the fax, however the employee testified to having no recollection of such a call.
Defendants attempted to reconcile Henry’s previously conflicting statements by claiming his reference to “a little over 6500 faxes delivered” meant the numbers were sent to a data cleaning service, but most of those faxes were not actually transmitted, and that Plaintiff’s “fax was part of [a] modest test run.” Id., at *3 (citations omitted). However, Defendants highlight that there is no evidence of any pre-suit mention of such a service, and Henry himself testified he has no records of any communication or transaction with a data cleaning provider. Plaintiff also emphasizes the inconsistencies in Henry’s testimony, stating he sent test faxes to 22 people, but originally mentioned 28 in his affidavit, and claimed in an email that he sent only a single fax.
Another wrinkle in the dispute is that, after being instructed to halt the blast fax campaign, Henry allegedly deleted all the relevant records—prompting Plaintiff to seek an adverse inference. Defendants counter that Henry is not a party to the case and that Plaintiff failed to timely raise the issue in its class certification motion, rendering any adverse inference unwarranted.
Analysis
To pursue class certification, Plaintiff must satisfy the Rule 23(a) prerequisites—numerosity, commonality, typicality, and adequacy—then show they qualify for a particular type of class action under Rule 23(b). Here, Plaintiff argues that it meets the Rule 23(b)(3) requirements that common questions of law and fact predominate and that class action resolution is superior to other methods.
Numerosity
To satisfy numerosity under Rule 23(a)(1), Plaintiff must show that the class is so numerous that joinder of all members is impractical, with the Seventh Circuit recognizing that around forty members typically suffices. Here, Plaintiff argues that even 1% of the 6,500 faxes which were allegedly delivered would establish numerosity. In particular, Plaintiff used the following correspondences between Henry and McLaughlin for support:
On August 6th, “I have scheduled this to run starting at 12 noon Sunday – if your happy with what the customer will receive it will go out”
On August 7th, “we are sending 14352 faxes today”
On August 8th, “we got a little over 6500 faxes delivered” and that the “second attempt” will pick up another 750
Id., at *4. Defendants counter by citing Henry’s post-suit deposition and affidavit claiming he only sent 28 faxes to parties who had consented, but the Court finds that this later testimony lacks credibility due to inconsistencies in Henry’s previous remarks, absence of corroborating evidence, and Henry’s deletion of relevant records. Ultimately, the Court concluded that Plaintiff has established numerosity.
Commonality
To satisfy commonality under Rule 23(a)(2), Plaintiff must show that there are common questions of law or fact capable of class-wide resolution, meaning the answers would resolve issues central to all class members. The Seventh Circuit holds that in cases under the TCPA, such as whether a fax is an advertisement, this standard is typically met because these are common questions across recipients, and “[n]othing about the instant case persuades the Court to depart from this general principle.” Id., at *5. The Court found commonality satisfied because the identical fax was allegedly sent to all recipients by the same marketing project, raising a shared legal question about whether the fax was an ad and who is liable for sending it. Defendants argue that the “distinction between traditional and online efaxes defeat commonality”, but the Court rejects this, noting that “commonality requires one common question, not the absence of any individual questions.” Id.
Typicality
Typicality under Rule 23(a)(3) requires that the representative plaintiff’s claims arise from the same course of conduct and share the same essential characteristics as the class members’ claims. Plaintiff, like all putative class members, allegedly received the same fax promoting the ACMQ conference, and the Defendants do not contest typicality. Thus, the Court concluded that typicality was satisfied.
Adequacy
Adequacy under Rule 23(a)(4) requires that the named plaintiff and their counsel fairly and adequately protect the interests of the class. Defendants challenged Plaintiff’s adequacy by pointing to Henry’s testimony that he received permission from Plaintiff to send the fax, suggesting Plaintiff was not harmed and thus unsuitable to represent the class. However, the Court found Henry’s testimony unconvincing, especially in light of the employee’s testimony that Plaintiff had a strict policy against receiving unsolicited faxes. The Court concluded that Henry’s statements did not undermine Plaintiff’s adequacy as a representative. Additionally, the Court found no issues with class counsel’s adequacy, noting their experience and lack of conflict. Accordingly, the Court determined that both Plaintiff and its counsel satisfied the adequacy requirement.
Rule 23(b)(3)
Rule 23(b)(3) requires that common questions of law or fact predominate over individual ones, and that a class action is superior to other methods for fairly and efficiently resolving the controversy. Predominance exists when core issues can be resolved on a class-wide basis, such as whether a fax was an advertisement, whether it violated the TCPA, and who is liable for the violation. Superiority is satisfied when a class action would promote efficiency and consistency in adjudication, especially for claims involving small individual stakes.
Defendants argued that predominance fails because individual issues—particularly whether each recipient consented to the fax—would require separate analysis. The Court rejected this, finding that Henry’s claim of consent only related to Plaintiff and not to other recipients, making consent a class-wide issue rather than an individualized one. Moreover, even if consent is an affirmative defense, it is the Defendants’ burden to prove and must be shown for each class member. The Court concluded that evidence of prior express permission did not predominate over the shared legal and factual questions. It also found superiority satisfied, noting that class-wide resolution would conserve resources and promote uniformity. Thus, Plaintiff met both the predominance and superiority requirements of Rule 23(b)(3).
Ascertainability
Ascertainability demands that a class is defined clearly and based on objective criteria. Defendants argued Plaintiff’s original class definition was improper because it hinged on whether faxes were sent “by or on behalf of” certain Defendants, making it a merits-based, fail-safe class. Id., at *7. In reply, Plaintiff proposed a revised definition:
“All persons with fax numbers, who on August 6–10, 2022, were sent faxes in the form of Exhibit A.”
Id. The Court found this new definition objective and free of merits issues, concluding ascertainability was satisfied.
Conclusion
Plaintiff’s Motion was granted, and the class is certified. The Court appointed Plaintiff as class representative and Edelman, Combs, Latturner & Goodwin, LLC as class counsel.
Keep in mind – the truth will find its way. Often delayed but rarely denied.
Until the next one, TCPAWorld!
Oregon Federal Judge Strikes Down State Law Requiring Labor Peace Agreements for Cannabis Licensure and Certification – OLCC Will No Longer Enforce State Requirement
On Tuesday May 20, 2025, U.S. District Judge for the District of Oregon, Michael H. Simon issued a decision in Casala LLC, d/b/a Bubble’s Hash and Rec Rehab Consulting LLC, d/b/a Ascend Dispensary v. Tina Kotek, in her official capacity as Governor of the State of Oregon, et al., Case No. 3:25-cv-244-SI (D.Or. May 20, 2025), striking down Oregon’s United for Cannabis Workers Act and holding that the law is preempted by the National Labor Relations Act (“NLRA”) in violation of the Supremacy Clause and the First Amendment of the United States Constitution.
Shortly after Oregon’s United for Cannabis Workers Act took effect, two cannabis employers Bubble’s Hash and Ascend Dispensary (collectively, “Plaintiffs”), filed suit for declaratory and injunctive relief, and sought a permanent injunction to enjoin the Oregon Governor, Oregon Attorney General, Chair of the Oregon Liquor and Cannabis Commission (“OLCC”), and Executive Director of the OLCC (collectively, “Defendants”), from enforcing the United for Cannabis Workers Act against them.
Plaintiffs alleged that the law: (1) was preempted by the NLRA and its enforcement would be in violation of the Supremacy Clause of the United States Constitution; (2) was void for vagueness in violation of the Due Process Clause of the United States Constitution; (3) abridged Plaintiffs’ freedom of speech in violation of the First Amendment, as made applicable to the States by the Fourteenth Amendment; (4) infringed on Plaintiffs’ right to equal protection in violation of the Fourteenth Amendment; and (5) disrupts Plaintiffs’ contractual arrangements in violation of the Contract Clause of the United States Constitution.
Following hearing argument on the merits, the Court granted Plaintiffs’ requested declaratory and permanent injunctive relief, concluding that the law was preempted by the NLRA, violated the Supremacy Clause and violated Plaintiffs’ First Amendment rights, and that the requirements for permanent injunctive relief were satisfied. With this decision, the Oregon District Court became the first U.S. District Court to strike down a state law that required cannabis employers to enter into labor peace agreements in order to receive or renew a license to sell cannabis.
On May 29, the OLCC issued the following statement concerning Judge Simon’s May 20 decision: “Earlier this month, a federal judge issued a ruling barring the enforcement of Ballot Measure 119. Given this ruling and in consultation with the Oregon Department of Justice, the OLCC will no longer require labor peace agreements as part of cannabis license application and license renewals.”
United for Cannabis Workers Act
The United for Cannabis Workers Act was passed by an initiative approved by Oregon voters in November 2024 as Ballot Measure 119 (“Measure 119”) and took effect December 5, 2024. Measure 119 requires businesses licensed to sell or process cannabis to enter into labor peace agreements with labor organizations or sign an attestation affirming that the business has entered into such agreement. The businesses must submit such agreements or attestations with their applications for a license, certification of renewal of a license, or certification to dispense cannabis. Oregon law defines a “labor peace agreement” (“LPA”) as “an agreement under which, at a minimum, an applicant or licensee agrees to remain neutral with respect to a bona fide labor organization’s representatives communicating with the employees of the applicant or the licensee about the rights afforded to such employees.
Plaintiffs had both been unable to enter into LPAs at the time of filing.
The District Court’s Decision
As an initial issue, the Court determined that the NLRA likely applied to cannabis businesses and does not limit its jurisdiction to “lawful commerce” or “legal substance” as some other federal laws do. Judge Simon pointed out that the National Labor Relations Board (“NLRB”) has issued advisory memoranda back to 2013 which stated that the medical marijuana industry is within the NLRB’s jurisdiction if the business meets the NLRA’s jurisdictional monetary requirements.
The Court determined that Measure 119 is preempted by the NLRA under Garmon preemption because it does not distinguish between permissible employer speech and threatening or coercive speech and thus impermissibly conditions a state license on an employer “refraining from conduct protected by federal labor law,” which “chills one side of the ‘robust debate which has been protected under the NLRA.’” In other words, Measure 119 chills an employer’s right to speech under section 8(c).
In terms of Machinist preemption, the Court held that by seeking to regulate and forbid certain truthful, non-deceptive, non-coercive speech about unionization and by conditioning license renewal on signing an LPA, Measure 119 sought to regulate the relationship between unions and employers, upsetting the balance Congress struck in passing the NLRA. Thus, it is preempted under Machinist preemption.
With respect to the First Amendment, the Court determined that because Measure 119 requires Plaintiffs to remain neutral with respect to labor organization’s representatives communicating with employees of the applicant or licensee and does not limit its restrictions to only threatening, coercive, false, or misleading speech, it violates Plaintiffs’ First Amendment rights to free speech.
Other States With Similar Labor Peace Agreement Requirements
While not binding on other courts outside of Oregon, given that the decision is the first to strike down a law that requires LPAs for licensure, the decision is likely to be utilized by cannabis businesses in other states with similar requirements, such as California, Rhode Island, New York, New Jersey, Connecticut, and Delaware, among others.[1]
The decision acknowledged and Defendants cited to a recent decision analyzing the California version of Measure 119, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (“MAUCRSA”) Ctrl Alt Destroy v. Elliott, 2025 WL 790963 at *7 n.8 (S.D. Cal. Mar 12, 2025) which held that Garmon preemption did not apply because of the local responsibility exception. Judge Simon rejected this conclusion of Ctrl Alt Destroy, pointing out that Measure 119 and MAUCRSA regulate only labor relations of cannabis businesses and do not regulate the sale or use of cannabis. Similarly, Judge Simon rejected the conclusion from the Ctrl Alt Destroy decision on Machinists preemption. Judge Simon reasoned that Machinists preemption seeks to protect balancing only in the labor relations context, not to regulation of the underlying market. Thus, Measure 119 regulates an area that Congress intended to leave to the free play of economic forces.
Takeaways
The OLCC will no longer require labor peace agreements as part of cannabis license application and license renewals in Oregon.
Employers seeking to challenge similar state LPA licensure requirements in other states are encouraged to speak with experienced labor counsel to discuss their options. We will continue to monitor similar challenges as they are filed, and provide additional updates.
FOOTNOTES
[1] Additionally, states including Illinois and Pennsylvania grant preferential treatment to businesses with LPAs when applying for licensure.
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Landmark Supreme Court Decision Limits NEPA Review Scope: Agencies Granted ‘Substantial Deference’ in Environmental Assessments
In an 8-0 decision, the U.S. Supreme Court reversed a D.C. Circuit ruling that had blocked construction of a new 88-mile freight railroad line, clarifying the scope of impacts that federal agencies must consider under the National Environmental Policy Act (NEPA). The Court’s majority opinion in Seven County Infrastructure Coalition v. Eagle County, No. 23-975 (May 29, 2025) is a sharp rebuke to what the Court describes as the aggressive interference by certain federal lower courts with the exercise of agency discretion in determining the scope of a NEPA review, a practice the Court found contrary to the intent of NEPA as a “purely procedural statute” designed to assist in agency decision making.
Background
The Uinta Basin Railway is a proposed 88-mile freight rail line intended to connect Utah’s Uinta Basin oil production to the national rail network. In 2020, the Seven County Infrastructure Coalition applied to the U.S. Surface Transportation Board (STB) for construction approval under 49 U.S.C. § 10901.
Pursuant to NEPA, the STB prepared a comprehensive Environmental Impact Statement (EIS), analyzing thousands of pages of potential environmental effects tied to the railway’s construction and operation. The EIS noted, but did not fully assess, potential upstream effects from increased oil drilling in the Uinta Basin and downstream impacts from oil refining along the Gulf Coast. In December 2021, the STB approved construction of the line, citing its economic and transportation benefits.
Eagle County, Colorado and several environmental organizations challenged the approval. The U.S. Court of Appeals for the D.C. Circuit ultimately vacated the STB’s decision authorizing the line’s construction, as well as the associated EIS and biological opinion.1 The D.C. Circuit held that the STB violated NEPA by failing to analyze foreseeable indirect environmental effects of increased fossil fuel development tied to authorizing and operating the line.
The Supreme Court’s Decision
Justice Kavanaugh authored the majority opinion for the Court, joined by Justices Roberts, Alito, Thomas, and Barrett. Justice Sotomayor filed a concurring opinion, joined by Justices Kagan and Jackson. Justice Gorsuch did not take part in the case.
The Court held that the D.C. Circuit erred in two fundamental respects:
1.
Failing to grant proper judicial deference to the STB’s judgment regarding the scope of the EIS.2
2.
Misinterpreting NEPA’s scope by requiring the STB to assess indirect effects of third-party oil and gas development and refining not caused by the project at issue.3
In an introductory discussion, Justice Kavanaugh briefly recounted the history of NEPA’s interpretation by courts and noted that “some courts have assumed an aggressive role in policing agency compliance with NEPA,” while others take a more “restrained” approach.4 Offering a corrective to “continuing confusion and disagreement” among federal courts, the opinion comes down decidedly on the side of judicial restraint. It “reiterate[s] and clarif[ies] the fundamental principles” of NEPA judicial review, including that NEPA is a purely procedural statute that grants broad discretion to agencies, and courts should not interfere if agency decision making falls within “a broad zone of reasonableness.”
Justice Kavanaugh emphasized that NEPA “does not mandate particular results” and, unlike other federal environmental statutes, does not impose any “substantive constraints” on the agency’s decision about a project. Agencies must take a “hard look” at the environmental consequences of their actions in the context of projects under consideration, but they are not required to assess indirect effects of separate federal, state, or private projects, even if the action under review might facilitate those projects.5 Making this scoping determination about indirect effects is clearly within the discretion of the agency preparing the NEPA document, and courts should honor it if it is “reasonable” and “reasonably explained.”6 Further, and of importance to NEPA jurisprudence, the Court instructed that “the adequacy of an EIS is relevant only to the question of whether an agency’s final decision … was reasonably explained.”7
Focusing on the question at issue – whether impacts of potential separate projects upstream and downstream of the proposed railroad must be evaluated in the EIS – the Court criticized the D.C. Circuit’s legal conclusion requiring inclusion of such projects in the EIS analysis. The Court reasoned that the STB had no decision-making or regulatory authority over such projects, and concluded that a separate project “breaks the chain of proximate causation.”8 Crucially, the Court stated that an agency’s determination of project scope–including whether a particular impact is the result of the action itself or of a separate project–is entitled to substantial deference, provided the agency offers a reasoned explanation.9 But the decision goes further, concluding that NEPA’s requirement to consider reasonably foreseeable impacts does not, as a matter of law, require agencies to include the indirect impacts of separate projects for which the lead agency plays no role in an EIS.
Justice Sotomayor’s concurrence emphasized that the majority reasoning should not be used to sidestep meaningful environmental review.10 The concurring opinion agreed with the outcome but emphasized the need for vigilance in ensuring agencies do not avoid meaningful environmental review through overly narrow interpretations of project scope or causation.
GT Insights
The decision is a win for project sponsors–including developers of infrastructure, housing, renewable energy, and industrial facilities–because it narrows the circumstances under which federal agencies must evaluate indirect adverse impacts of a project undergoing NEPA review. The Court reaffirmed that NEPA imposes procedural obligations only; agencies must take a “hard look” at environmental effects, but they are not required to engage in speculative or limitless analysis of impacts from separate projects.11
Much of the decision is a general discussion – citing the Court’s precedents – about the broad discretion agencies enjoy under NEPA and the requirement of judicial deference to that discretion. While some of this language may be dicta, it nonetheless has importance to lower court judges, agencies, and project proponents because it signals that the Court believes that the time and effort spent by agencies in preparing comprehensive NEPA reviews has gone beyond the statute’s intent at the expense of new infrastructure projects. Particularly relevant is the Court’s observation that “intrusive (and unpredictable)” reviews by lower courts “have slowed down or blocked many projects and, in turn, caused litigation-averse agencies to take ever more time and to prepare ever longer EISs for future projects.” The decision at multiple points expresses disapproval of the use of NEPA to delay or block projects that “otherwise comply with all relevant substantive environmental laws,” leading to “fewer and more expensive railroads, airports, wind turbines, transmission lines, dams, housing developments, highways, bridges, subways, stadiums, arenas, data centers, and the like.”
The decision, however, also emphasizes that the substantial deference that courts should afford agency NEPA determinations in no way should be viewed as inconsistent with its recent decision in Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024), which eliminated Chevron deference. The Court distinguished between Chevron deference to agency interpretations of statutory language with agencies’ exercise of discretion expressly granted to them by NEPA. The Court found that agency determinations as to the scope and detail of a NEPA review are not statutory interpretations, but rather fact-intensive endeavors to which courts must defer unless the decisions issued in connection with such review violate the Administrative Procedure Act’s “arbitrary and capricious” standard.
The Court explicitly noted that omissions in an EIS are not automatically fatal to an agency approval. So long as the agency provides a rational explanation for its ultimate decision, including decisions about what need not be considered in a NEPA review, courts may not substitute their judgment for that of the agency.12 Also, echoing arguments of some NEPA reform advocates, the Court introduced a new concept that EIS deficiencies need not always result in vacatur, “absent a reason to believe that the agency might disapprove the project if it added more to the EIS.”13
The Court pointed to a broader concern: NEPA litigation has increasingly been used to block or delay projects, resulting in more litigation and fewer projects. The decision may therefore provide needed guardrails for agencies and developers, reducing litigation risk stemming from speculative or tangential environmental claims.14
Seven County stands as a declaration by the U.S. Supreme Court that lower courts should not allow litigants to use the strictly procedural requirements of NEPA in a manner that unnecessarily delays or blocks infrastructure projects approved by federal agencies. It remains to be seen the extent to which the lower courts and federal agencies that grapple with future controversial projects will take that declaration to heart.
1 See Eagle County v. Surface Transp. Bd., 60 F.4th 828 (D.C. Cir. 2023)
2Slip op. at 9, 21.
3 Id. at 6-9, 19-21.
4 Id. at 8.
5 Id. at 20-21.
6 Id. at 9.
7 Id.
8 Id.at 16-17.
9 Id. at 21.
10 Id., Sotomayor, J., concurring at 1-2.
11 Id. at 6-7.
12 Id. at 9.
13 Id. at 14.14 Id. at 23.
Additional Authors: Courtney M. Shephard, Eric Waeckerlin, and Jenna Rackerby
The Angel is in the Details: Grant Agreements that Matter
Philanthropy is designed to make the world a better place, but the angel is in the details.
The relationship between donors and organizations, whether it’s a major medical institution or a small local nonprofit, are never adversarial …until they are. One of the best ways to ensure satisfaction is to clarify expectations and build a tight and clearly written agreement around a grant.
There’s no central data-base tracking litigation between grant makers and grant receivers, but common knowledge is that lawsuits are few and far between. Even so, consequences for poorly-thought-through grant agreements can be pernicious and include family or community infighting, reputational disparagement, and disillusionment with the art and science of giving.
Many donors and tax advisors focus on minimum annual distributions and look to move money fast but there are multiple ways to meet distribution requirements. Structured agreements are a blueprint for the future that help both donors and grantees navigate expectations.
Using a corporate contract template for grants can be both off-putting and insufficient. But, yes, there needs to be a set of standard clauses like terms, termination, arbitration, and indemnification (which is typically mutual) but there’s much more needed.
Here are three scenarios (there are many more) about what can go wrong:
A donor family funds a lab at a university that costs $1 million. It’s a meaningful donation for the family and they visit it periodically and talk about it with pride. The director who led the lab retires and a new director comes in with different needs and purposes. Within five years of the gift the lab is gone, and the family name has been removed – and they found out when they brought their granddaughter to see it. No one ever called them.
A couple funded a new engineering center at a day school their daughter attended. They wanted to give back to the school that supported their child and made a $3 million dollar donation on the recommendation of the Head of School. After five years there isn’t a plan or budget, and the center isn’t built. Funding paid in full has been generating interest that is not designated to the project.
Through their foundation, a family funds a new program at a cost of $500 thousand dollars, designed to educate at-risk youth over a ten-year period in the community where they built their business. After three years the organization moves the program to another site because it was not sustainable where it was. The family wants their money back.
Engaging clients in building a detailed outline that includes:
The client’s understanding and goals for the near- and long-term expectations
The organization’s goals and capacity to carry out the grant
Terms that describe the triggers for distribution meaning time and accomplishments in advance of future payments
Metrics for evaluating the grant
Details about communications expectations both internally and publicly
Contingency specifications, especially in the case of capital projects, that might include right of first refusal
Consider developing a plain language template for private foundation clients that can be adjusted to meet the criteria and expectations, in terms of time, funding distributions, and short- and long-term expectations of the investment, and to support your clients in finding their better angels.
New Louisiana State Legislation Rolls Back Advantages Long Afforded to Personal Injury Claimants
Louisiana has enacted new laws addressing the burden of proof and limitation on damages in personal injury claims. These enactments not only affect claims arising on land but also may extend to claims arising on fixed structures in state waters and on the Outer Continental Shelf, where state law has been applied as surrogate federal law. Among the notable new legislative actions are the enactment of Code of Evidence Article 306.1, the amendment of Civil Code Article 2323(A), and the enactment of Civil Code Article 2323(D).
The newly enacted Code of Evidence Article 306.1 is meant to overrule the long-held evidentiary standard of Housley v. Cerise, 579 So.2d 973 (La. 1991), otherwise known as the Housley Presumption. Under the rule of Housley, a claimant’s personal injury was presumed to have resulted from the accident in controversy so long as the claimant could prove that the injury in question did not exist prior to the accident’s occurrence. This was widely considered to be a liberal standard, highly favoring plaintiffs engaged in litigation. Now, Art. 306.1 does away with this presumption, as it expressly states that “the lack of a prior history of an illness, injury, or condition shall not create a presumption that an illness, injury, or condition was caused by the act that is the subject of the claim.” Of note is the fact that the updated provisions of Art. 306.1 will not be applied to presently ongoing matters. It is to have “prospective application only” and therefore will apply exclusively to causes of action arising after it goes into effect. Nonetheless, Art. 306.1 will create a more onerous burden of proof for claimants in personal injury actions brought under Louisiana state law, much to the benefit of defendants in the same.
The changes to Civil Code Article 2323 center on state law theories of comparative fault. Prior to the signing of this new legislation, Civ. Code Art. 2323(A)(1) provided that a claimant found to have suffered injury, death, or loss partially due to his own negligence would see his recoverable damages reduced in proportion to the “degree or percentage of negligence attributable” to the claimant. This language has been removed from the statute entirely. Instead, Civ. Code Art. 2323(A)(2)(a) will now provide that a claimant found to be at least 51% responsible for his own injury will not be entitled to recovery of any related damages whatsoever. The sentiment of the rule as it was previously written is preserved in altered form in Civ. Code Art. 2323 (A)(2)(b), however, which now reads that a claimant found to be less than 51% responsible for his injuries will see his recoverable damages reduced in proportion “to the degree or percentage of negligence attributable” to the claimant. In addition to its amendments to Civ. Code Art. 2323(A), the legislature has added a Civ. Code Art. 2323(D), which provides that “[i]n cases where the issue of comparative fault is submitted to the jury, the jury shall be instructed on the effect of this Article.” This is to say that juries tasked with assigning percentages of fault to each party will receive instruction outlining the new ramifications of Civ. Code Art. 2323.