In Circuit City Stores v. Adams, a 5-4 majority of the Court, including Scalia and Thomas, narrowly construed the exemption clause in the Federal Arbitration Act, which means that most employment contracts will fall within the scope of the Act. As a result of this decision, many employers will be able to require their employees, as a condition of employment, to arbitrate any claims arising out of their employment, rather than file suit. Employees often lack the bargaining power to reject these arbitration clauses, and will be required, as the price of having a job, to give up their legal right to sue if they become the victims of employment discrimination or have other claims against their employer. A bill has been introduced in Congress that would effectively overrule the Court’s decision.
In a 5-4 decision in Palazzolo v. Rhode Island, the Court majority, including Scalia and Thomas, held that a property owner who acquired the property after the state had adopted environmental regulations applicable to the property and was thus deemed to have notice of those regulations nonetheless could seek compensation from the state for the loss caused by the state’s “taking” of that property. While Justice O’Connor wrote a separate concurrence to make clear her belief that the timing of a regulation’s enactment relative to when the owner acquired title was still relevant to a takings claim, Justice Scalia wrote his own separate concurrence in order to state his vehement disagreement with that position. According to Scalia, the fact that a restriction “existed at the time the purchaser took title” should have “no bearing upon” whether there was a taking. For various reasons, the four dissenting justices, Stevens, Ginsburg, Souter, and Breyer, would not have allowed the property owner to pursue his claims against the state. Three of them (Ginsburg, Souter, and Breyer) agreed with Justice O’Connor that an owner’s acquisition of property after the enactment of environmental regulations could, at a minimum, impair the new owner’s ability to seek compensation for a taking, while Justice Stevens would have barred such a claim entirely.
In Solid Waste Agency of Northern Cook County v. United States Army Corps of Engineers, a 5-4 majority that included Scalia and Thomas ruled that the provision of the Clean Water Act giving the Army Corps of Engineers authority to regulate the dredging and filling of “navigable waters” cannot be construed to extend federal authority over non-navigable, isolated intrastate waters (such as ponds) even though they provide a habitat for migratory birds. In so ruling, the Court overturned a 15-year-old environmental regulation of the Corps of Engineers commonly known as “the Migratory Bird Rule.” The Court sidestepped the question of whether the Clean Water Act, if construed to authorize the Migratory Bird Rule, would exceed Congress’ power under the Commerce Clause, a question pertinent to the narrow Court majority’s recent trend toward limiting congressional authority in favor of “states’ rights.” The majority opinion alluded to the federalism question, however, stating that to uphold the authority claimed by the Corps of Engineers over isolated waters “would result in a significant impingement of the States’ traditional and primary power over land and water use.” Justice Stevens, Souter, Ginsburg, and Breyer dissented, stating that the Migratory Bird Rule was a “manifestly reasonable” interpretation of the Clean Water Act that should be given deference by the Court. The dissent called the majority’s decision “an unfortunate step that needlessly weakens our principal safeguard against toxic water.”