US Supreme Court heard rescheduled oral arguments by phone on Tuesday for the second day of the 2020 term.
The first case before the court, Rutledge v. Pharmaceutical Care Management Association, looked at a 2015 Arkansas law, Act 900. The Act regulates Pharmacy Benefits Managers (PBMs), the intermediaries between health insurance plans and pharmacies, to address the problem of pharmacies being reimbursed less than the cost of pharmaceuticals in an effort to keep small and rural pharmacies viable. Arkansas Solicitor General, Nicholas Bronni, defended the Act, while Pharmaceutical Care Management Association argued that it is preempted by the Employee Retirement Income Security Act (ERISA). ERISA has a broad preemption provision, preempting “any and all State laws insofar as they may now or hereafter relate to any employee benefit plans.”
The question before the court is whether regulating PBMs is related to regulating employee benefits plans or plan administration. In response to a statutory interpretation question presented by Justice Samuel Alito, Bronni argues for a limited interpretation of the broad language of the statute. Bronni cited the late Justice Antonin Scalia saying, “as every curbstone philosopher knows, everything is ultimately related to something—to everything else. And that—that really means there would be no limiting principle, and that would present serious constitutional concerns.” Counsel for Pharmaceutical Care Management Association argued that “relates to” should be interpreted as concerning either a central matter of plan administration or the national uniformity of plan administration. The case is on appeal from the Eighth Circuit, which held the Act was preempted by ERISA.
The court also heard arguments in the case of Tanzin v. Tanvir, involving a lawsuit against FBI agents for actions taken in their official capacity. The plaintiffs, Muslim men, were placed on a “do not fly” list for refusing to cooperate with the FBI agents. They claim to have been unable to cooperate due to the tenets of their faith. RFRA allows individuals who have had their religious freedom burdened to “assert that violation as a claim or defense in a judicial proceeding and obtain appropriate relief against a government.” The question before the court is whether money damages is appropriate relief and whether “government” incorporates individual federal employees.
The definitions section of RFRA defines “government” to include, “a branch, department, agency, instrumentality, and official (or other person acting under color of law) of the United States, or of a covered entity.” Tanvir argued for a plain reading of the statute, which would leave officials liable in their personal capacity. The petitioners argued the term “official” should be treated as a “residual parenthetical phrase” that refers back to agency, department, etc.; therefore, it should be interpreted to mean in their official capacity rather than personal. Further, Tanzin claimed that appropriate remedy against the government is meant to include only injunctive relief, not money damages, unless the statute specifically allows for money damages. The respondents argued that limiting the interpretation to injunctive relief allows petitioners, and other agents, to “flout RFRA until challenged in court and then back off.” The District Court dismissed the case against the agent while the Second Circuit reversed before the Supreme Court granted certiorari.