On May 2, the U.S. Supreme Court added three more cases to its docket for next term. The first raises the question whether Spending Clause legislation may ever confer a privately enforceable “right” under Section 1983. The second concerns when an employee is “highly compensated” and thus not subject to federal overtime pay rules. And the third addresses whether the U.S. Bankruptcy Code’s bar on discharging liabilities incurred from fraud applies when the debtor has no knowledge of the fraud.
The Spending Clause and overtime pay cases will be closely followed, as they are likely to affect thousands of public entities and private businesses. A number of amicus briefs were filed in these cases while they were pending before their respective circuit courts, and both cert. petitions had multiple supporting amicus briefs. And while the bankruptcy case drew no cert-stage amicus briefs, it too is likely to have significant consequences, especially for bankruptcy cases involving allegations of fraud.
Section 1983 provides a cause of action for the deprivation, under color of state law, of “any rights … secured by the Constitution and laws.” This provision is famous as a tool for vindicating constitutional rights, but in 1980 the Supreme Court held that the reference to “and laws” means Section 1983 can be used to enforce certain statutory rights as well. In Health and Hospital Corporation of Marion County v. Talevski,...
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