Circuit splits. They play an important role in shaping the Supreme Court’s agenda. There are a number of reasons why the Supreme Court focuses on Circuit splits, including because: (1) the Constitution favors uniformity, (2) the Supreme Court seeks to discourage forum shopping, and (3) the Supreme Court is motivated by the desire to ensure fairness and to avoid differences in law based solely on geographic location.
(1) Back in August, the Sixth Circuit in In re William Lindsey weighed in on a Circuit split concerning bankruptcy appeals. It joined four other circuits (the Second, Eighth, Ninth, and Tenth) in concluding that a decision rejecting a confirmation plan does not constitute a final appealable order under Section 158(d)(1) of the Bankruptcy Code. Three other Circuits (the Third, Fourth, and Fifth) have gone the other way, but the Sixth Circuit did not find those cases convincing. So the split is 5-3, with the Sixth Circuit in the majority.
(2) Back in August, the Sixth Circuit in Indiana State Dist. Council v. Omnicare, Inc. created a split with the Second and Ninth Circuits by holding that Section 11 of the Securities Act of 1933, 15 U.S.C. § 77k, which creates liability for false statements in registration statements, provides for strict liability and does not require a plaintiff to plead a defendant’s state of mind. No other Circuit has addressed the Sixth Circuit’s decision in Omnicare, so it is unclear whether the 2-1 Circuit split will attract Supreme Court review. Court watchers have noted that the Supreme Court generally waits for an issue to fully “percolate” within the Circuits before granting cert. On the other hand, three Circuits addressing an issue may be the threshold number for when the Supreme Court may consider review.
(3) Finally, back in January, the Sixth Circuit in Sanders v. Allison Engine Company, Inc. contributed to a Circuit split when it joined the Second and Seventh Circuits in holding that the term “claim” under the False Claims Act, 31 U.S.C. § 3729 et seq., refers to “a civil action or case,” as opposed to a claim or demand for payment, as the Ninth and Eleventh Circuits have held. The distinction was important in Sanders because if a “claim” had meant a request or demand for payment, then plaintiffs could not take advantage of the retroactive application of § 3729.
So that’s where the Sixth Circuit stands in relation to other Circuits in 2013. These are interesting cases to follow because they have an increased chance of landing at the Supreme Court.