The Supreme Court’s Business Docket

https://www.nytimes.com/2022/10/01/business/dealbook/supreme-court-business-cases.html

Upcoming Supreme Court cases could have big implications for businesses.

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The Supreme Court’s new term, which starts on Monday, is studded with momentous cases on affirmative action, voting, religion and gay rights. Those highly charged disputes can overshadow other aspects of the court’s work, notably the significant cases on its business docket, which could influence how companies are regulated, conduct diversity hiring, and more.

The Supreme Court has in recent years become increasingly skeptical of the power of administrative agencies. In its last term, it and in the workplace.

On Nov. 7, the court will hear a pair of arguments that could make it easier to challenge the constitutionality of two other agencies, the Federal Trade Commission and the Securities and Exchange Commission. The cases are both about timing, asking the justices to decide how long people and businesses must litigate with agencies that seek to regulate their conduct before they can go to federal court.

The first case, Axon Enterprise v. Federal Trade Commission, concerns a firm that makes body cameras for law enforcement and was investigated by the F.T.C. as part of a merger review. Rather than waiting for the conclusion of the proceedings before the agency, the company tried to sue in a federal trial court, arguing that the agency’s structure was unconstitutional and that it did not have the authority to review the merger.

Even as it rejected that attempt, a divided three-judge panel of the U.S. Court of Appeals for the Ninth Circuit said Axon’s argument had force.

The court’s aggressive approach has led its approval ratings to plummet. In a recent Gallup poll, 58 percent of Americans said they disapproved of the job the Supreme Court was doing. Such findings seem to have prompted several justices to  in recent public appearances.The court will hear arguments in a case that could  by giving state legislatures independent power, not subject to review by state courts, to set election rules in conflict with state constitutions. In a rare plea, state chief justices urged the court to reject that approach.The justices will hear an appeal from a web designer who  in a case that pits claims of religious freedom against laws banning discrimination based on sexual orientation. The court last considered the issue in 2018 in a similar dispute, but failed to yield a definitive ruling.

On Nov. 8, the justices will consider whether states can require corporations to agree to be sued in that state’s courts as a condition of doing business in the state.

The case, Mallory v. Norfolk Southern Railway, concerns Robert Mallory, a Virginia man who says he developed colon cancer from exposure to toxic chemicals while working in Virginia and Ohio for the Norfolk Southern Railway Company, which was based and incorporated in Virginia. The question in the case is whether he can sue in a third state — Pennsylvania.

The Supreme Court has long said that corporations may be sued where they are incorporated or where their headquarters are. And they may be sued in particular cases if the plaintiff’s claims are related to the defendant’s contacts with the state.

Mr. Mallory relies on none of those bases for jurisdiction. Rather, he points to a Pennsylvania law that requires companies that do business in the state to consent to being sued there. The railroad says the law is unconstitutional.

Lawyers for Mr. Mallory say the law is a sort of mirror image of the take-it-or-leave-it contracts that many businesses use to force consumers and workers into arbitration or require them to sue far from their homes.

In a brief supporting the railroad, the Biden administration said the Pennsylvania law “subverts interstate federalism by reaching beyond Pennsylvania’s borders and allowing state courts to hear cases in which Pennsylvania has no legitimate interest.”

On Oct. 11, the court will hear National Pork Producers Council v. Ross, a challenge to a California law that seeks to reduce cruelty to animals by requiring that pork sold in the state come from breeding pigs housed in spaces that allow them to move around freely.

The law forbids the sale of most pork in California unless the pig it comes from was born to a sow that was housed with 24 square feet of space. But most sows around the nation are kept in much smaller enclosures.

“These pens,” the groups challenging the California law wrote in a Supreme Court brief, “provide around 14 square feet of space and — for hygiene, safety, and animal-welfare and husbandry reasons — do not allow the sow to turn around.”

Given the size of California’s market, pork producers say, the state effectively seeks to regulate businesses outside its territory in violation the Constitution.

A unanimous three-judge panel of the U.S. Court of Appeals for the Ninth Circuit, in San Francisco, rejected the argument that the law’s out-of-state effects made it invalid. “State laws that regulate only conduct in the state, including the sale of products in the state, do not have impermissible extraterritorial effects,” Judge Sandra S. Ikuta wrote for the panel.

The Supreme Court’s ruling could have implications for many other laws, including state laws addressing climate change and out-of-state travel to obtain abortions.

Two cases on social controversies that have gotten a lot of attention also have big business implications. In a major challenge to affirmative action programs, the court may strike down the . There may well be spillover effects for employers seeking to assemble diverse workforces.

The pipeline of highly credentialed minority candidates would tighten, defenders of the programs argued, and, depending on the logic of the ruling, employers’ diversity efforts could be challenged under a federal law prohibiting workplace discrimination.

A brief supporting the universities filed by scores of companies, including Apple, General Motors, Google, Meta Platforms and Starbucks, said they relied on leading colleges and universities to train diverse leaders and that “racial and ethnic diversity enhance business performance.”

The court is also considering whether a Colorado web designer may despite a state law barring businesses open to the public from discriminating based on sexual orientation and other identity categories. As a legal matter, the case concerns free speech, and a ruling in favor of the designer could allow other businesses engaged in expressive conduct to discriminate against groups of which they disapprove.

What do you think? Which of the court’s decisions could have the biggest impact for your business? Let us know: dealbook@nytimes.com.