# Weekend Law: SCOTUS to Decide Tariffs, Presidential Power & Music Piracy

An episode of [Bloomberg Law](https://invisiblenetwork.ai/podcast/277975394), 2 Jan 2026, 37 min.

Audio: https://podtrac.com/pts/redirect.mp3/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/7c892d84-801f-4c0b-b0e9-ae2b0012ff5f/06fdc028-0145-4926-8fdc-b3c60150cf84/audio.mp3?utm_source=Podcast&in_playlist=91224201-26a6-429d-ac3c-ae2b0012ff6d

June Grasso speaks to legal experts about top Supreme Court decisions to be handed down in 2026 regarding President Trump's tariffs, presidential control over independent agencies and music piracy. See omnystudio.com/listener for privacy information.

## Transcript

[0:02] Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio.
[0:08] Speaker 2: Why do you think Presidents Clinton, Bush Obama have not
[0:15] Speaker 2: used i EPA to impose tariffs.
[0:18] Speaker 3: It's one of the most important cases of the term,
[0:21] Speaker 3: a test of presidential power where President Trump's signature economic
[0:26] Speaker 3: policy is at stake and a decision against him could
[0:30] Speaker 3: mean the refunding of more than one hundred billion dollars.
[0:34] Speaker 3: And after nearly three hours of oral arguments in November,
[0:38] Speaker 3: Supreme Court justices across the ideological spectrum appeared skeptical that
[0:43] Speaker 3: Trump has the legal authority to impose the tariffs. Chief
[0:48] Speaker 3: Justice John Roberts and Justice Sonya Sotomayor said, the tariffs
[0:52] Speaker 3: are taxes, and the Constitution gives taxing power to Congress.
[0:58] Speaker 4: It's a congressional power or not a presidential power to tax.
[1:02] Speaker 4: And you want to say tarifts are not taxes, but
[1:05] Speaker 4: that's exactly what they are, degenerating money from American citizens revenue.
[1:11] Speaker 5: The vehicle is in position of taxes on Americans and
[1:15] Speaker 5: that has always been the core power of Congress.
[1:17] Speaker 3: Trump is arguing that the International Emergency Economic Powers Act
[1:22] Speaker 3: or AIPA, gives him virtually unlimited powers to impose tariffs
[1:27] Speaker 3: by executive order. But as several justices pointed out, the
[1:32] Speaker 3: word tariffs is nowhere to be found in that law.
[1:36] Speaker 3: Here are the Chief Justice and Justice Katanji Brown Jackson.
[1:40] Speaker 5: Well, but the exercise of the power is to impose tariffs, right,
[1:44] Speaker 5: and the statute doesn't use the word tariffs.
[1:47] Speaker 1: Your argument suggests that we should see the word imposed,
[1:51] Speaker 1: the phrase impose tariffs in that same series of things
[1:55] Speaker 1: that the president could do. We don't see that word.
[1:58] Speaker 1: And instead you take regulator and say that must mean that.
[2:02] Speaker 3: No other president has tried to impose tariffs under AEPA.
[2:07] Speaker 3: And Justice Neil Gorsuch, a Trump appointdee, expressed alarm at
[2:12] Speaker 3: the idea that Congress could delegate such seemingly unlimited power
[2:17] Speaker 3: to the president.
[2:18] Speaker 6: So Congress, as a practical matter, can't get this power
[2:21] Speaker 6: back once it's handed it over to the President's a
[2:24] Speaker 6: one way ratchet toward the gradual but continual accretion of
[2:28] Speaker 6: power in the executive branch and away from the people's
[2:32] Speaker 6: elected representative.
[2:33] Speaker 3: All three lower courts that ruled on the issue found
[2:36] Speaker 3: the tariffs to be unlawful. My guest is Timothy Bright Bell,
[2:41] Speaker 3: partner and co chair of the International Trade practice at
[2:44] Speaker 3: Wiley Rhin. Tim tell us what's at stake in this case?
[2:49] Speaker 7: This case involves the centerpiece of President Trump's economic agenda.
[2:55] Speaker 7: Is the biggest trade case the Supreme Court has ever heard,
[2:58] Speaker 7: and it goes straight to the key constitutional issue of
[3:03] Speaker 7: who has the power to impose tariffs, the US Congress
[3:07] Speaker 7: or the president. President Trump says the law that he used,
[3:10] Speaker 7: the International Emergency Economic Powers Act, gives him the power
[3:15] Speaker 7: to regulate imports, and that that includes the power to
[3:19] Speaker 7: impose tariffs, including entanyl tariffs on China, Canada, and Mexico,
[3:25] Speaker 7: and reciprocal economic tariffs on almost all countries. Whereas the
[3:28] Speaker 7: plaintiffs in this case say that Congress has that power
[3:31] Speaker 7: and cannot delegate that power, and that AEPA, which has
[3:35] Speaker 7: never before been used to impose tariffs, does not include
[3:39] Speaker 7: that power and authority. So that is what is at stake.
[3:42] Speaker 7: And of course the tariffs under AYEPA have led to
[3:46] Speaker 7: collection of hundreds of billions of dollars of tariffs already,
[3:50] Speaker 7: so it's very high economic stakes for the companies and
[3:54] Speaker 7: industries that have paid those tariffs as well.
[3:56] Speaker 3: There's always a textual analysis these days, and many of
[3:59] Speaker 3: the els his work concerned that the text of the
[4:03] Speaker 3: statute doesn't mention the word tariffs at all exactly.
[4:08] Speaker 7: The argument focused quite heavily on this law used by
[4:11] Speaker 7: President Trump AIPA and whether that law, which gives the
[4:15] Speaker 7: president the power to regulate imports, also includes the power
[4:20] Speaker 7: to impose tariffs. That really dominated most of the hearing,
[4:23] Speaker 7: and the justices asked very difficult questions on both sides.
[4:28] Speaker 7: The administration said that the ability to impose tariffs is
[4:32] Speaker 7: a core application of the ability to regulate imports in
[4:36] Speaker 7: a historical context, said that, of course, the power to
[4:40] Speaker 7: regulate imports would be read to include tariffs because tariffs
[4:45] Speaker 7: have been used throughout our country's history. On the other hand,
[4:48] Speaker 7: several justices were skeptical of that, and the plaintiffs in
[4:51] Speaker 7: this case said that when the delegation includes tariff authority,
[4:57] Speaker 7: there is always specific language to that effect, and that
[5:00] Speaker 7: there are always conditions and tests and agency decisions that
[5:05] Speaker 7: have to go into that tariff power. So there was
[5:08] Speaker 7: a good amount of the argument focused on those issues,
[5:10] Speaker 7: and again, whether power to regulate imports includes the power
[5:14] Speaker 7: to impose tariffs and.
[5:15] Speaker 3: What did you think about the Solicitor General's argument that
[5:19] Speaker 3: the Trading with the Enemy Act of nineteen seventeen gives
[5:23] Speaker 3: the president authority to impose these tariffs.
[5:26] Speaker 7: The Solicitor General argued, yes, that the Trading with the
[5:30] Speaker 7: Enemy Act was used to impose tariffs in a prior
[5:34] Speaker 7: situation by President Nixon, and that there's no reason to
[5:38] Speaker 7: think that anything had changed when AIPA had passed. On
[5:41] Speaker 7: the other hand, the plaintiffs had a response to that
[5:45] Speaker 7: in terms of the fact again that when tariffs are involved,
[5:50] Speaker 7: there are always conditions on their use, there are always
[5:53] Speaker 7: specific procedures, and also the fact that the reality is
[5:57] Speaker 7: that no other president in fifty years has used AIPA
[6:01] Speaker 7: to impose tariffs.
[6:02] Speaker 3: The Major Questions doctrine came up several times during the arguments.
[6:07] Speaker 3: It basically says that when the executive branch takes an
[6:11] Speaker 3: action with major political or economic significance, Congress has to
[6:17] Speaker 3: have expressly authorized it, and the Chief Justice made it
[6:21] Speaker 3: fairly clear that he thought the Major Questions doctrine applies here.
[6:27] Speaker 7: Yes, So the question here is does the Major Questions
[6:30] Speaker 7: doctrine require a clear statement in AIPA that it includes
[6:35] Speaker 7: the power to impose tariffs, and this Court has not
[6:39] Speaker 7: hesitated to start using that doctrine more broadly. But I
[6:45] Speaker 7: think you're right that the justices had some concerns about
[6:49] Speaker 7: pursuing it in this venue. And again, the question comes
[6:53] Speaker 7: to is the power to tariff implied in the power
[6:57] Speaker 7: to regulate imports or if it's not. Was this a
[7:01] Speaker 7: question that Congress was required to state clearly that tariffs
[7:06] Speaker 7: were a part of what was envisioned by the new law.
[7:10] Speaker 3: The Conservatives us the Major Questions doctrine to block several
[7:14] Speaker 3: of President Biden's initiatives, like his student loan forgiveness program.
[7:19] Speaker 3: If they allowed Trump to impose these tariffs, do you
[7:23] Speaker 3: think they'll have to explain why the Major Questions doctrine
[7:27] Speaker 3: applied to Biden but not Trump.
[7:30] Speaker 7: I think it's an interesting question whether they'll go there
[7:32] Speaker 7: or whether they will just focus on the language of
[7:35] Speaker 7: AIBA and this issue of whether the power to regulate
[7:38] Speaker 7: imports includes the power of tariff, and I think several
[7:42] Speaker 7: justices went down that road. I don't think just because
[7:46] Speaker 7: these doctrines have been used in other cases, such as
[7:49] Speaker 7: the Biden student bond forgiveness case, doesn't necessarily mean that
[7:52] Speaker 7: they will have to address it in this opinion if
[7:55] Speaker 7: they have other bases for finding that the tariffs were
[7:59] Speaker 7: legal or improper in any way.
[8:02] Speaker 3: And Justice Gorsuch in particular expressed alarm about the seeming
[8:08] Speaker 3: lack of limitations on the powers the President was claiming.
[8:12] Speaker 7: Here, Justice Corsa the hypothetical of if Congress can delegate
[8:17] Speaker 7: the tariff authority, what would prohibit Congress from delegating everything,
[8:22] Speaker 7: including the power to declare war, which is clearly given
[8:25] Speaker 7: in the Constitution to Congress. And so that was a
[8:29] Speaker 7: very interesting discussion. I'm certainly raising some concerns about the limits,
[8:35] Speaker 7: if any, on the authority that the government was claimed.
[8:39] Speaker 3: So where do you think the justices are going to
[8:41] Speaker 3: come out here.
[8:42] Speaker 7: Well, I'm not in the business of making predictions. Generally,
[8:46] Speaker 7: my own personal view is that the Court's three Democratic
[8:49] Speaker 7: justices probably vote against these tariffs. And then the question
[8:52] Speaker 7: is whether some of the majority of the Court have
[8:55] Speaker 7: similar concerns about the president's use of this law. And
[8:59] Speaker 7: I do think that it's still a very close decision.
[9:02] Speaker 7: It could go either way. I thought Chief Justice Roberts
[9:05] Speaker 7: and Justice Barrett and Justice Gorsich were perhaps more skeptical
[9:10] Speaker 7: of the president's tariff authority under I than the other justices.
[9:14] Speaker 7: I guess the only other point I would make is,
[9:17] Speaker 7: although it was discussed in the oral argument, I have
[9:20] Speaker 7: a hard time seeing this court making a split decision
[9:24] Speaker 7: that some of President Trump's tariffs are acceptable but others
[9:27] Speaker 7: are not.
[9:28] Speaker 3: So if the Court does rule against Trump, what happens
[9:31] Speaker 3: next as far as his tariffs are concerned.
[9:34] Speaker 7: Well, two things would happen. First of all, there would
[9:37] Speaker 7: likely be some sort of a refund process for importers
[9:40] Speaker 7: that paid the tariffs during this time, and there is
[9:43] Speaker 7: some precedent for that before that was discussed during the
[9:46] Speaker 7: oral argument a situation where the court struck down a
[9:49] Speaker 7: harbor maintenance tax and there was basically a process where
[9:53] Speaker 7: companies could file claims for the amount of the tax
[9:56] Speaker 7: that they paid. So Justice Barrett's was concerned that this
[9:59] Speaker 7: could be a and could be very unwieldy. I guess
[10:02] Speaker 7: the more important point is what will the president do
[10:04] Speaker 7: going forward? And I think it's clear that tariffs are
[10:08] Speaker 7: still a cornerstone of this administration's economic policy, and if
[10:13] Speaker 7: the Court says that the President cannot use AIPA, the
[10:17] Speaker 7: president will likely pivot to one of several other trade
[10:21] Speaker 7: tools that are available, and the Court mentioned many of these,
[10:25] Speaker 7: including Section one twenty two, the section two thirty two,
[10:29] Speaker 7: the National Security Law, which the administration has already made
[10:33] Speaker 7: quite a bit of use of in this administration, Section
[10:36] Speaker 7: three zero one, and so forth. The limit on those
[10:39] Speaker 7: laws is that they do require studies or actions by
[10:43] Speaker 7: other agencies. So Section two thirty two requires a study
[10:46] Speaker 7: and a report by the Commerce Department and consultation with
[10:50] Speaker 7: Defense Department in order to decide that imports of a
[10:54] Speaker 7: certain product like semiconductors or pharmaceuticals are a threat to
[11:00] Speaker 7: national security. Similarly, Section three oh one, which was the
[11:04] Speaker 7: law used to impose tariffs on China during the first
[11:08] Speaker 7: Trump administration, also requires a detailed study by the US
[11:13] Speaker 7: Trade Representative with public inputs. So those tools, for the
[11:17] Speaker 7: most part, cannot be used as quickly as AIPA was
[11:21] Speaker 7: used by President Trump.
[11:22] Speaker 3: The Court put this tariff's case on a fast track,
[11:26] Speaker 3: suggesting that the justices we'll try to resolve the case quickly,
[11:30] Speaker 3: so a decision could come down at any time. Thanks
[11:33] Speaker 3: tim that's Timothy Brightbill of Wilie Rhine Coming up next,
[11:38] Speaker 3: will the Supreme Court give the president control over dozens
[11:42] Speaker 3: of independent federal agencies. I'm June Grosso when you're listening
[11:46] Speaker 3: to Bloomberg. A ninety year old president maybe toppled this
[11:52] Speaker 3: year by the Supreme Court's conservatives, and reversing the Humphreys
[11:56] Speaker 3: executor ruling would give the president control over potentially dozens
[12:01] Speaker 3: of traditionally independent federal agencies. At oral arguments last month,
[12:07] Speaker 3: the conservative justices suggested they will allow President Trump to
[12:12] Speaker 3: fire Rebecca Kelly's slaughter from the Federal Trade Commission, despite
[12:16] Speaker 3: a law that says commissioners can be fired only for
[12:20] Speaker 3: specific reasons. The liberal justices like Sonya Soto Mayor and
[12:24] Speaker 3: Elena Kagan expressed alarm at giving the president such unchecked
[12:29] Speaker 3: authority over agencies that overlook crucial areas like nuclear energy,
[12:35] Speaker 3: consumer products safety, and labor relations.
[12:39] Speaker 4: You're asking us to destroy the structure of government and
[12:43] Speaker 4: to take away from Congress its ability to protect its
[12:49] Speaker 4: idea that the government is better structured with some agencies
[12:55] Speaker 4: that are independent.
[12:57] Speaker 8: So the result of what you want is that the
[13:00] Speaker 8: president is going to have massive, unchecked, uncontrolled power not
[13:05] Speaker 8: only to do traditional execution but to make law.
[13:09] Speaker 3: But the conservative justice is like Brett Kavanaugh and Neil
[13:13] Speaker 3: Gorsuch say the real concern is Congress's creation of agencies
[13:18] Speaker 3: that exercise executive power but can't be held accountable.
[13:23] Speaker 2: Independent agencies are not accountable to the people. They're not elected,
[13:29] Speaker 2: as Congress and the President are, and are exercising massive
[13:33] Speaker 2: power over individual liberty and billion dollar industries, whether it's
[13:38] Speaker 2: the FCC or the FTC or whatever it might be.
[13:42] Speaker 9: Tomorrow we could have the Labor Commission, the Education Commission,
[13:46] Speaker 9: the Environmental Commission, rather than Departments of Interior and so forth.
[13:53] Speaker 3: Opponents of regulation have long sought to reverse the nineteen
[13:57] Speaker 3: thirty five Humphreys Executor ruling, a decision that upheld FTC
[14:02] Speaker 3: job protections and cleared the way for the independent agencies
[14:07] Speaker 3: that proliferate across the federal government. My guest is constitutional
[14:11] Speaker 3: law expert William Traynor, a professor at Georgetown Law, Bill
[14:16] Speaker 3: tell us about the issues in Rebecca Slaughter's case against
[14:20] Speaker 3: Trump for firing her.
[14:22] Speaker 10: The issue before the screen Couard is that Congress puts
[14:25] Speaker 10: the limits on when the President and fire the heads
[14:30] Speaker 10: of independent agencies. So an independent agency is like the
[14:33] Speaker 10: Federal Trade Commission or the Federal Reserve. So really, since
[14:38] Speaker 10: the start of the Constitution, Congress has imposed limits on
[14:42] Speaker 10: when the president can fired these people. The question in
[14:44] Speaker 10: the case is whether that's unconstitutional, whether the president can
[14:48] Speaker 10: fire the head of an independent agency for any reason,
[14:51] Speaker 10: even if Congress has said they can only fire them,
[14:54] Speaker 10: you know, if they're engaged in bad behavior. So this
[14:58] Speaker 10: is a very big deal. So much of the government
[15:00] Speaker 10: structure that protects people in different ways or regulates the
[15:04] Speaker 10: economy is done through independent agencies. Congress has wanted to
[15:07] Speaker 10: insulate them from total executive control, and the Supreme Court
[15:12] Speaker 10: is deciding right now whether, in fact the president has
[15:15] Speaker 10: the kind of control that comes with being able to
[15:17] Speaker 10: fire the leaders of the agencies.
[15:19] Speaker 3: In these oral arguments, you often hear the Supreme Court
[15:21] Speaker 3: justices say, well, that's a job for Congress. You know,
[15:25] Speaker 3: that's not something that we should be interfering in. So
[15:29] Speaker 3: why are they interfering here where Congress has set up
[15:32] Speaker 3: these agencies and the rules.
[15:35] Speaker 10: That's a great question. There have been so many times
[15:37] Speaker 10: in which the Court is saying this is a political matter,
[15:41] Speaker 10: we shouldn't be deciding. But at the same time, the
[15:44] Speaker 10: conservative justices of the Court are very dedicated to what's
[15:49] Speaker 10: called the unitary executive theory, which means that the president
[15:53] Speaker 10: is in total charge of the executive branch. So what
[15:57] Speaker 10: they're saying here is Congress doesn't get to be involved.
[16:00] Speaker 10: The president is in total charge of the executive branch,
[16:03] Speaker 10: including what is historically been things like the independent agencies.
[16:07] Speaker 10: That is kind of one of the core commitments that
[16:10] Speaker 10: has really been at the basis of what Chief Justice
[16:14] Speaker 10: Roberts has thought, really going back to when he was
[16:16] Speaker 10: a young attorney, and that's the same thing for most
[16:19] Speaker 10: of the whole conservative wing.
[16:21] Speaker 3: What kind of concerns did the conservative justices express during
[16:25] Speaker 3: the oral arguments about this ninety year old President Humphrey's executor.
[16:32] Speaker 10: There are two things that we're seeing the conservative wing
[16:35] Speaker 10: of the Court struggle with. One is they want the
[16:38] Speaker 10: Federal Reserve to continue to be independent. They don't want
[16:43] Speaker 10: the president to be able to fire somebody on the
[16:46] Speaker 10: Federal Reserve. And they don't want that because you know,
[16:49] Speaker 10: that would be terrible for the economy. If the Federal
[16:52] Speaker 10: Reserve is setting interest rates just in order to help
[16:55] Speaker 10: the president rather than to help the economy, that would
[16:58] Speaker 10: be a disaster, a disaster for the market, the disaster
[17:02] Speaker 10: for the economy as a whole. So the conservative wing
[17:04] Speaker 10: of the Court I think wants to overturn Humphrey's executor.
[17:08] Speaker 10: But they're trying to come up with some rationale in
[17:11] Speaker 10: which they can say, the president can fire somebody on
[17:15] Speaker 10: the FTC, but he can't fire somebody on the Federal Reserve.
[17:19] Speaker 10: And they're going to be looking at the Federal Reserve
[17:22] Speaker 10: later in the term. That's a big concern for them.
[17:25] Speaker 10: So I think that animates all of the conservative justices
[17:28] Speaker 10: of the Court. I think also, you know, what I'm
[17:31] Speaker 10: hearing with the Chief Justices, what he's trying to do
[17:34] Speaker 10: is to come up with some way in which there's
[17:37] Speaker 10: some agencies where Congress can in fact limit the president's
[17:41] Speaker 10: ability to fire people. And he's thinking about, you know,
[17:45] Speaker 10: are the ones that are essentially kind of judicial in
[17:48] Speaker 10: their function, and you know, that may be an area
[17:51] Speaker 10: in which Congress can establish requirements for when the prison
[17:55] Speaker 10: can terminate somebody. But that's not the Federal Trade Commission.
[17:58] Speaker 10: Federal Trade Commission is not making the judicial decisions, you know,
[18:01] Speaker 10: it's very much deciding executive type rules. So I think
[18:05] Speaker 10: we're seeing two things on the conservative wing of the Court.
[18:08] Speaker 10: One is they're trying to come up with some way
[18:11] Speaker 10: in which they can say the president can fire somebody
[18:13] Speaker 10: the FDC, but not at the FED. And I think
[18:16] Speaker 10: the Chief is trying to come up with some way
[18:19] Speaker 10: in which there's some type of agencies in which the
[18:22] Speaker 10: president can be limited by Congress, but those would be
[18:25] Speaker 10: ones that are really deciding kind of fuzzi judicial matters,
[18:28] Speaker 10: not the FDC.
[18:30] Speaker 3: The liberals painted a dire picture of what would happen
[18:33] Speaker 3: if Trump wins here, just as sot Of Mayr said
[18:36] Speaker 3: to the Solicitor General, you're asking us to destroy the
[18:39] Speaker 3: structure of government. Do you think it's that serious.
[18:44] Speaker 10: I think that's absolutely right. You know, we have had
[18:47] Speaker 10: independent agencies which largely exists to protect people of limited power,
[18:52] Speaker 10: you know, and they've been in place really for one
[18:55] Speaker 10: hundred years. And the idea is that these should be
[18:58] Speaker 10: basically bipartisan or apolitical. They should not just be tools
[19:03] Speaker 10: of the president. So what the Court is considering right
[19:05] Speaker 10: now is whether that whole kind of structure gets got it.
[19:08] Speaker 10: So the stakes on this are huge.
[19:11] Speaker 3: Well, President Trump wasn't specifically mentioned by name. Two of
[19:17] Speaker 3: the liberal justices, Elina Kagan, and Katanji Brown Jackson did
[19:22] Speaker 3: make broad references to his firing of experts and dismantling
[19:27] Speaker 3: of the Department of Education.
[19:29] Speaker 8: The more realistic danger here is that we'll have an
[19:33] Speaker 8: Education Department, as authorized by Congress by law, that won't
[19:37] Speaker 8: have any employees in it.
[19:40] Speaker 1: Having a president come in and fire all the scientists
[19:45] Speaker 1: and the doctors and the economists and the PhDs and
[19:48] Speaker 1: replacing them with loyalists and people who don't know anything
[19:53] Speaker 1: is actually not in the best interest of the citizens
[19:55] Speaker 1: of the United States.
[19:57] Speaker 10: You know, what we're seeing right now is that in
[19:59] Speaker 10: the Trump admin the independent agencies and all of the
[20:03] Speaker 10: government watchtols, there's an attempt to politicize them in a
[20:06] Speaker 10: way that you know, we've never seen before. So the
[20:09] Speaker 10: stakes are very different, and they're much higher. You know,
[20:12] Speaker 10: if Humphrey's executor has been overturned in President Bush forty
[20:17] Speaker 10: three's administration, the stakes would have been very different because
[20:21] Speaker 10: President Bush was not focused on making independent agencies kind
[20:26] Speaker 10: of the tool for his politics. But that's what we're
[20:28] Speaker 10: seeing with President Trump, and that's why the stakes are
[20:31] Speaker 10: so high. They've always been big, but in this administration
[20:35] Speaker 10: where there's such an attempt to kind of move away
[20:38] Speaker 10: from scientific expertise and neutral decision making to control every
[20:44] Speaker 10: part of the executive branch. The stakes are huge, and
[20:47] Speaker 10: that's really a part of what those three liberal justices
[20:51] Speaker 10: we're questioning. You know, the other thing that they really
[20:54] Speaker 10: are focusing in and on. It's very, very hard to
[20:58] Speaker 10: come up with some law where you can say, Congress
[21:01] Speaker 10: can limit the president's ability to fire the heads of
[21:04] Speaker 10: the sec they can't fire at will the heads of
[21:08] Speaker 10: the set. And I can't think of any kind of
[21:10] Speaker 10: coherent way to distinguish those two cases. And that's one
[21:13] Speaker 10: of the things that the liberals were pressing on. You know,
[21:16] Speaker 10: I think they're also pressing on the history. If you
[21:18] Speaker 10: look at the constitutions, the text of the constitutions doesn't
[21:21] Speaker 10: say that the president gets to fire people in the
[21:24] Speaker 10: executive reruntion. It doesn't deal with removal at all. So
[21:27] Speaker 10: there's not a text that really helps the conservative way
[21:30] Speaker 10: of the Court and Congress really, starting in the Washington administration,
[21:35] Speaker 10: limited the president's ability to fire people running agencies kind
[21:39] Speaker 10: of what was analogous to modern agencies at the time.
[21:41] Speaker 10: So I think what the liberals on the Court are
[21:44] Speaker 10: focusing on are the text, the original understanding, as well
[21:47] Speaker 10: as the huge consequences of essentially giving the president the
[21:51] Speaker 10: power to politicize all of the independent agencies.
[21:54] Speaker 3: I wonder what happens when there is a democratic president.
[21:57] Speaker 3: Do the Conservatives then try to limit the ruling they're
[22:01] Speaker 3: expected to make here?
[22:03] Speaker 10: You know, one of the reasons why I think that
[22:06] Speaker 10: the court should not overturn Humphrey's Executor is to the
[22:09] Speaker 10: extent that you have any kind of political con terms,
[22:13] Speaker 10: you're giving a democratic president the power to do exactly
[22:16] Speaker 10: what President Trump is doing, to politicize every independent agency
[22:20] Speaker 10: in the way that that president wants, you know. And
[22:22] Speaker 10: then how does a conservative court say, well, you know,
[22:25] Speaker 10: Humphrey Executors is back. Once you establish a rule, you know,
[22:29] Speaker 10: it applies to everybody. And that's something that they really
[22:32] Speaker 10: have to think through because of the long term consequences,
[22:35] Speaker 10: because I don't think they would feel comfortable, you know,
[22:38] Speaker 10: with limiting a democratic president after they allow President Trump
[22:42] Speaker 10: to fire people whenever he wants.
[22:44] Speaker 3: So then you think this is the end of Humphrey's Executor.
[22:48] Speaker 10: No, I think they will completely overrule Humphrey's Executor. I
[22:51] Speaker 10: think the one question for me is whether the Chief
[22:56] Speaker 10: comes up with some limiting principle in which if there
[23:00] Speaker 10: are causing judicial independent agencies, then Congress can put limitations
[23:06] Speaker 10: on the president's ability to fire. But you know, the
[23:08] Speaker 10: basic point is, I think they're going to overturn Humphrey's
[23:11] Speaker 10: executive So I think what the Court will try to
[23:14] Speaker 10: do is to say the President can't fire Jerome Power,
[23:17] Speaker 10: can't fire Lisa Cook. But you know, I don't think
[23:20] Speaker 10: that that is a coherent approach because I think it
[23:23] Speaker 10: would be based on history, but the history doesn't support it.
[23:26] Speaker 2: Well.
[23:26] Speaker 3: We often see some strained interpretations of history from this court,
[23:32] Speaker 3: and we'll learn more about the carve out the Supreme
[23:34] Speaker 3: Court is indicating it wants to create for the FED
[23:38] Speaker 3: on January twenty first, that's when the justices we'll hear
[23:42] Speaker 3: oral arguments in the case over President Trump's attempt to
[23:45] Speaker 3: fire Federal Reserve Governor Lisa Cook. Thanks so much for
[23:49] Speaker 3: your insights, Bill. That's Professor William Traynor of Georgetown Law
[23:54] Speaker 3: coming up next on the Bloomberg Law Show. The Supreme
[23:57] Speaker 3: Court is weigh in giving Internet providers a stronger shield
[24:01] Speaker 3: from lawsuits when customer's pirate copyrighted works. At issue is
[24:06] Speaker 3: a jury's verdict of one billion dollars in a music
[24:10] Speaker 3: industry lawsuit against Cox Communications. I'm June Grosso and you're
[24:15] Speaker 3: listening to Bloomberg. The music industry faced off against internet
[24:20] Speaker 3: providers at the Supreme Court in December. At issue a
[24:25] Speaker 3: one billion dollar jury verdict against Cox Communications for not
[24:29] Speaker 3: shutting down the accounts of customers who pirated more than
[24:33] Speaker 3: ten thousand copyrighted songs by artists like Beyonce and Justin Timberlake.
[24:39] Speaker 3: The lawyers painted very different bleak pictures of the consequences
[24:43] Speaker 3: of a decision against their clients. Joshua Rosenkrantz represents the
[24:48] Speaker 3: internet provider Cox, and Paul Clement represents the record companies.
[24:54] Speaker 11: There is no short fireway for an ISP to avoid liability.
[25:00] Speaker 11: The only way it can is to cut off the Internet,
[25:04] Speaker 11: not just for the accused infringer, but for anyone else
[25:08] Speaker 11: who happens to use the same connection. That could be
[25:12] Speaker 11: entire towns, universities, or hospitals. If Cox is right on
[25:17] Speaker 11: the law, then Cox could take tens of thousands of
[25:20] Speaker 11: copyright notices and throw them in the trash.
[25:23] Speaker 6: And they could have its employees say f the DMCA.
[25:26] Speaker 3: The issue is whether Internet providers should be held responsible
[25:30] Speaker 3: for contributing to copyright infringement when they know their customers
[25:34] Speaker 3: are pirrating music but don't terminate their Internet access. Several
[25:39] Speaker 3: justices appeared skeptical that Cox had done enough to stop piracy,
[25:44] Speaker 3: and questioned whether a favorable ruling would allow Internet service
[25:48] Speaker 3: providers to ignore clear copyright infringement. Here are Justices Sonya
[25:53] Speaker 3: Sotomayor and Amy Cony Barrett.
[25:56] Speaker 4: You did nothing and in fact your clients sort of
[26:02] Speaker 4: lays a fair attitude towards the respondents is probably what
[26:08] Speaker 4: got the jury upset.
[26:10] Speaker 8: What incentive would you have to do anything? If you
[26:13] Speaker 8: want you if you win and mayor knowledge isn't enough.
[26:17] Speaker 1: Why would you bother to send out any notices in
[26:19] Speaker 1: the future.
[26:20] Speaker 3: But Justice Samuel Alito expressed concerns about the effect on
[26:25] Speaker 3: large institutions like universities or hospitals. If an Internet service
[26:30] Speaker 3: provider is forced to cut off infringers.
[26:33] Speaker 6: What is an ISP supposed to do with a university
[26:37] Speaker 6: account that has let's say, seventy thousand users? What is
[26:41] Speaker 6: the university supposed to do?
[26:43] Speaker 3: My guest is Intellectual property litigator Terrence Ross, a partner
[26:47] Speaker 3: at Katan Euchen Rosenman Terry, will you explain the issue
[26:51] Speaker 3: here and the process of policing music piracy.
[26:56] Speaker 12: The issue in the case involved process by which recording
[27:00] Speaker 12: companies track online sharing of musical compositions that they own.
[27:07] Speaker 12: The copyright in the process allows them to identify the
[27:12] Speaker 12: IP address and the ISP that is providing the service
[27:18] Speaker 12: to that IP address, and so the music companies recording
[27:22] Speaker 12: companies regularly on a daily basis, in fact, send notices
[27:27] Speaker 12: of infringement to the ISPs that are providing the internet
[27:32] Speaker 12: service to these infringers. And there are days in which
[27:35] Speaker 12: they're sending out ten thousand notices to each individual ISP service.
[27:41] Speaker 12: And the recording companies finally became fed up that the
[27:44] Speaker 12: ISPs were not doing something. They wanted the ISPs to
[27:48] Speaker 12: cut off service to these identified infringers, and the ISPs
[27:53] Speaker 12: dragged their heels doing anything taking any real concrete action
[27:58] Speaker 12: to stop it. And so oh the recording company's finally
[28:02] Speaker 12: sued cos Cable Company, which is one of the largest
[28:07] Speaker 12: ISPs in the nation, alleging that they had engaged in
[28:11] Speaker 12: contributory copyright infringement.
[28:13] Speaker 3: In its papers. Cox had argued that Grandma will be
[28:17] Speaker 3: thrown off the Internet because Junior visited and illegally downloaded songs.
[28:23] Speaker 3: Did some of the justices seem to pick up on
[28:25] Speaker 3: that concern.
[28:27] Speaker 12: There was only one justice who seemed to give some
[28:30] Speaker 12: credence that, and that was Justice the Lead of He
[28:32] Speaker 12: was the only justice who really seemed to buy into
[28:36] Speaker 12: the position by Cox that it was hesitant to kick
[28:41] Speaker 12: people off because of and then you can fill in
[28:43] Speaker 12: the blank as to what the reason is their grandmother,
[28:46] Speaker 12: their a university, their hospital. In fact, the hypothetically posed
[28:50] Speaker 12: at oral argument in the Supreme Court was what happens
[28:53] Speaker 12: when all you can do is identify that the IP
[28:56] Speaker 12: address belongs to university? Or you wereing to shut down
[28:59] Speaker 12: the entire universe? One of those odd hypotheticals that takes
[29:03] Speaker 12: the case the extreme. The facts are actually contrast to that,
[29:07] Speaker 12: and indeed none of the other justices seemed to buy
[29:10] Speaker 12: into that argument. The reality is that over the period
[29:14] Speaker 12: of time and issue, Cox had received one hundred and
[29:17] Speaker 12: sixty three thousand notices of infringement and had kicked off
[29:22] Speaker 12: of its service only thirty two customers. The policy of
[29:29] Speaker 12: compliance used by Cox was described in some detail, and
[29:34] Speaker 12: it was sub law. They fare to use the word
[29:38] Speaker 12: that one of the justices used to describe it. They
[29:41] Speaker 12: had originally started off to say, well, if we get
[29:43] Speaker 12: three notices about a particular user, we're going to tell
[29:47] Speaker 12: them we're cutting off their service. That rose gradually over
[29:50] Speaker 12: time from being a three strikes you're out policy to
[29:53] Speaker 12: being a thirteen strikes and you're aut policy. And the
[29:56] Speaker 12: thirteen strikes reset every six months, so if you didn't
[30:00] Speaker 12: get to thirteen within a six month period, you went
[30:03] Speaker 12: back to zero. They also capped the number of notices
[30:06] Speaker 12: that they were accepting from recording companies at three hundred
[30:10] Speaker 12: a day. And then probably the worst fact of all
[30:14] Speaker 12: in which got brought up at the Supreme Court, if
[30:17] Speaker 12: you could believe that was the head of copyright Compliance
[30:20] Speaker 12: at Cox sent out an email to the people in
[30:23] Speaker 12: charge of enforcing copyright policy in which he said, f
[30:29] Speaker 12: the DMCA. Now, the DMCA refers to the Digital Millennium
[30:34] Speaker 12: Copyright Act, which is one of the key statutes that
[30:37] Speaker 12: shoe here and which requires ISPs to set up a
[30:43] Speaker 12: policing mechanism against copyright infringement if they want to claim
[30:48] Speaker 12: the safe harbor. That is embedded in the Digital Millennium
[30:51] Speaker 12: Copyright Act. In response to that, one of the minions
[30:55] Speaker 12: for the head of Compliance wrote back, say, but we're
[30:57] Speaker 12: helping law breaking customers. And there were dozens of emails
[31:01] Speaker 12: like this amongst the compliance group of Cocks that just
[31:04] Speaker 12: manifested a complete disdain for copyright laws, which obviously impacted
[31:10] Speaker 12: the jury because the jury below had awarded a billion
[31:13] Speaker 12: dollars in damages against Cock, and in the Supreme Court
[31:16] Speaker 12: argument it was clear that outside of Justice Alito, none
[31:19] Speaker 12: of the eight other justices were buying what Cox was
[31:23] Speaker 12: trying to claim was their reason for not cutting off
[31:27] Speaker 12: people that you'd kick grandma's off of the Internet. The
[31:31] Speaker 12: other eight justices just didn't buy it, and it was
[31:33] Speaker 12: a loser argument for.
[31:34] Speaker 3: Cock, and some of the justices appeared pretty skeptical about
[31:39] Speaker 3: Cox's excuses for not stopping the piracy.
[31:43] Speaker 12: There's apparently one period of time at which twenty one
[31:46] Speaker 12: percent of all traffic on the Cocks Internet connections involved
[31:50] Speaker 12: copyright in fringe, and the lawsuit below didn't go after
[31:54] Speaker 12: every single mom and pop business or every single college student.
[32:00] Speaker 12: Was targeted only at distributors, not people who were downloading
[32:05] Speaker 12: the occasional song, but people who were copying music digitally
[32:09] Speaker 12: and distributing it on a mass scale. So there was
[32:13] Speaker 12: this enormous skepticism expressed by the justice, except for Justice Alita,
[32:19] Speaker 12: that Cox really wasn't fulfilling its obligation and needed to
[32:24] Speaker 12: do something differently. Now. On the other hand, there also
[32:27] Speaker 12: seemed to be some concern about the size of the
[32:30] Speaker 12: jury verdict and whether or not the actions of Cocks
[32:36] Speaker 12: were sufficient to constitute willful contributory infringement, which is what
[32:41] Speaker 12: set them up for much larger scale of damages than
[32:45] Speaker 12: if this had been found to be just ordinary copyright infringement.
[32:49] Speaker 3: So, Terry, where do you think the justices will come
[32:51] Speaker 3: out here?
[32:52] Speaker 12: I just don't know what they're going to do here.
[32:56] Speaker 12: I have to be frank, this is one of the
[32:58] Speaker 12: more opaque oral arguments I have listened to. Justice Soto
[33:02] Speaker 12: Mayor commented at one point during the argument that the
[33:06] Speaker 12: court was being forced to choose between two extreme positions,
[33:10] Speaker 12: and it was very skeptical of Cox's position, but also
[33:14] Speaker 12: didn't quite like the extreme argument being made by Sony
[33:19] Speaker 12: Music Corp. In the recording company seems really perplexed as
[33:22] Speaker 12: to what to do genuinely perplexed. The problem the Supreme
[33:25] Speaker 12: Court faces here is that the standard for contributory copyright
[33:30] Speaker 12: infringement has been pretty well settled in this court for
[33:35] Speaker 12: more than a century. As early as nineteen twelve, there
[33:40] Speaker 12: was a case that involved miniograph machines. They were Xerox
[33:45] Speaker 12: machines way of doing sort of a mass production. And
[33:49] Speaker 12: there was a case in which a publisher sued a
[33:52] Speaker 12: mimeograph company for knowingly selling mimeograph materials to a company
[33:58] Speaker 12: that it knew was in aged in infringing copyright works
[34:02] Speaker 12: by using the miniograph machine. And the standard was set
[34:06] Speaker 12: out there and has been repeated over and over since
[34:10] Speaker 12: that time nineteen twelve, and the standard is pretty simple.
[34:14] Speaker 12: If you provide something that you know is going to
[34:17] Speaker 12: be used by a person to commit copyright infringement, you've
[34:20] Speaker 12: engaged in contributory infringement. And the past cases haven't spoken
[34:25] Speaker 12: in terms of needing an affirmative act, although one could
[34:28] Speaker 12: argue this did not come up with the Supreme Court
[34:30] Speaker 12: hearing that providing the Internet service is an affirmative act.
[34:34] Speaker 12: The Cox company argued the Court that that's not an
[34:38] Speaker 12: affirmative act, but that's sort of a stretch in order
[34:41] Speaker 12: to try to get around that line cases, the Cox
[34:45] Speaker 12: Company argued that contributory infringement is really akin to aiding
[34:50] Speaker 12: and embedding liability in the context of torts and criminal laws,
[34:55] Speaker 12: and that's a real stretch that I think is just
[34:57] Speaker 12: dead wrong. It would give the court a way to
[35:00] Speaker 12: get out of this dilemma, but it would mean the
[35:02] Speaker 12: Court would have to overturn half a dozen cases going
[35:06] Speaker 12: back to nineteen twelve for over a century and say
[35:08] Speaker 12: now they're not good law anymore. I don't see the
[35:10] Speaker 12: Court doing that here.
[35:12] Speaker 3: Do you think we'll see that justices coming up with
[35:14] Speaker 3: some sort of middle ground.
[35:17] Speaker 12: So it's a shame that Justice Ginsburg is no longer
[35:20] Speaker 12: on the Court. And we've had many conversations about our
[35:23] Speaker 12: knowledge of copyright law and her ability to copy together
[35:27] Speaker 12: coalitions for positions under the Copyright Act that we're actually
[35:31] Speaker 12: quite pragmatic and useful. And I just don't see anybody
[35:35] Speaker 12: either with that depth of knowledge to copyright law or
[35:38] Speaker 12: the ability to do that sort of log rolling on
[35:40] Speaker 12: this court. And so I think it's going to be
[35:42] Speaker 12: a real struggle for this Court to come up with
[35:44] Speaker 12: some sort of middle ground, particularly in light of the
[35:47] Speaker 12: fact that the law here is just so set for
[35:50] Speaker 12: such a long period time, and the sort of odd
[35:52] Speaker 12: cases that cocksited to the Supreme Court, including this recent
[35:56] Speaker 12: gun distribution case. Topreme Court to site recently where the
[35:59] Speaker 12: gun companies were being sued for deaths in Mexico and
[36:04] Speaker 12: the argument was they were aiding embedding this criminal activity.
[36:07] Speaker 12: And the gun company said, well, we sold the guns
[36:10] Speaker 12: to dealers in Texas, not knowing what they were going
[36:13] Speaker 12: to do with them, and if anybody's contributed to them,
[36:16] Speaker 12: but it's not us. We had no knowledge of it.
[36:18] Speaker 12: And that case just doesn't fit here, either legally or factually.
[36:24] Speaker 12: And yet cops sort of beed a lot on that.
[36:27] Speaker 12: I mean, it was almost as if there's a oh, hey,
[36:29] Speaker 12: we cite to some case in which the second Circuit,
[36:33] Speaker 12: which everybody bleeds in on the Supreme Court, that'll get
[36:36] Speaker 12: us over the humpire. It's just such a strutch that
[36:38] Speaker 12: in fact backfires. One starts to think, well, what's wrong
[36:42] Speaker 12: with their case that that's the best they've got.
[36:44] Speaker 3: Yeah, gun distribution and pirated music don't seem to equate.
[36:49] Speaker 3: Thanks so much, Terry. As always, that's Terrence Fross of
[36:52] Speaker 3: Catain Euchen Rosenman, and that's it for this edition of
[36:55] Speaker 3: The Bloomberg Law Show. Remember you can always get the
[36:58] Speaker 3: latest legal news on our Bloomer podcasts. You can find
[37:01] Speaker 3: them on Apple Podcasts, Spotify, and at www dot bloomberg
[37:06] Speaker 3: dot com, slash podcast Slash Law, And remember to tune
[37:10] Speaker 3: into The Bloomberg Law Show every weeknight at ten pm
[37:13] Speaker 3: Wall Street Time. I'm June Grosso and you're listening to
[37:17] Speaker 3: Bloomberg

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