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Rotunda on High Court Recusals

Stock ownership by justices of the U.S. Supreme Court poses a growing problem that could best be solved by divestiture, says judicial ethics expert Professor Ronald Rotunda. "There is a problem with judges getting into situations where they have to recuse themselves," he told a Bloomberg.com reporter. "I think the answer is they ought to sell the stock and buy mutual funds."

Rotunda's comments were carried in an article examining the problems created by judicial recusals, specifically in the case American Isuzu Motors v. Ntsebeza in which the high court was unable to reach a quorum due to the recusals of four justices, three of which are presumed to be over stock ownership. The high court's inability to hear the case resulted in affirmation of the lower court's ruling and precluded the defendants' ability to appeal.

Companies Rebuffed by High Court on Apartheid Suits (Update1), Bloomberg.com, May 13, 2008. By Greg Stohr.

Excerpt:
"The lower court ruling left open the possibility that the companies ultimately could win dismissal on different grounds. The three-judge panel didn't rule on the companies' contention that the case raises political issues better suited to resolution outside the courtroom. The appeals court said the companies should press those arguments first at the trial court level.

"The high court's action today upheld the 2nd Circuit's ruling. Under federal law, when the justices don't have a quorum and aren't likely to obtain one, the Supreme Court's members who can participate are required to affirm the lower court ruling. Unlike most high court rulings, today's decision doesn't set a nationwide precedent.

"'We are disappointed that recusals made the court unable to hear the case and correct the 2nd Circuit majority's clear legal errors,' the companies' lead lawyer, Francis Barron, said in an e-mailed statement.

"One of the lawyers pressing the suit, Michael Hausfeld, said in a statement that 'we are pleased with the court's decision and will do all we possibly can to bring justice to the victims of the horrific apartheid regime.'

"Many Recusals

"The stock holdings of the justices have come into play repeatedly in their current term. Roberts, a Pfizer Inc. shareholder, didn't take part when the court considered patients' lawsuits against drugmakers. In March the court announced it was divided 4-4, leaving intact a ruling allowing suits against Pfizer over its Rezulin diabetes drug.

"Days earlier, only eight justices considered Exxon's bid to overturn a $2.5 billion punitive damage award stemming from the 1989 Valdez oil spill. Alito, an Exxon shareholder, isn't taking part in the case, which the court will resolve by July.

"'There is a problem with judges getting into situations where they have to recuse themselves,' said Ronald Rotunda, an expert on judicial ethics at George Mason University's law school in Fairfax, Virginia. 'I think the answer is they ought to sell the stock and buy mutual funds.'''

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