UNBIASED - April 24, 2024: SCOTUS Hears Abortion Ban Arguments, Here's How the Justices Are Leaning; FTC Bans Non-Competes; USDA Sets Limits on Sugar in Schools, DOT Requires Airline Refunds, and More.

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Starting point is 00:00:50 call the Conax Ontario helpline at 1-866-531-2600. BetMGM operates pursuant to an operating agreement with iGaming Ontario. Welcome back to Unbiased, your favorite source of unbiased news and legal analysis. Welcome back to Unbiased. Today is Wednesday, April 24th, and this is your daily news rundown. We do have quite a bit to go over today, so we're just going to jump right into the stories. There's three final rules I want to cover, one that was released yesterday, two released today, oral arguments in an abortion case in front of the Supreme Court, and then some other a couple of other stories from today as well. So we'll start with the Senate passing the $95 billion foreign aid package yesterday and a 79 to 18 votes. And today, President Biden

Starting point is 00:01:37 signed it into law. So let's quickly talk about what that means, because I have touched on this in a couple of recent episodes. So I definitely don't want to go into too much detail, but Ukraine will get $61 billion, Israel will get $26 billion, which includes $9 billion for humanitarian assistance in Gaza, and Taiwan will get around $8 billion. On top of that, the passage also allows for the seizure of an estimated $5 billion in frozen Russian assets to help pay for Ukraine assistance. It places sanctions on Iranian-linked entities. It forces the divestiture of TikTok to avoid a ban here in the United States. And it also prohibits data brokers from selling Americans' personal information to foreign adversaries. But I do want to note that the TikTok ban specifically

Starting point is 00:02:23 will likely get held up in legal challenges. So although the bill requires a sale in nine months, and it also gives the president the opportunity to extend that deadline another three months, we could see this take even longer than that, just depending on how the legal challenges take shape. So that's just something I wanted to note quickly. But let's move on to some new final rules that have been announced yesterday and today. So yesterday afternoon, right as I finished recording the episode, the FTC announced the issuance of a

Starting point is 00:02:55 new final rule banning non-compete agreements nationwide. So the FTC says its purpose in making this move is to promote competition, give freedom to workers to change their jobs, increase innovation, and foster new business formation. The FTC estimates that banning non-competes will grow new business formation by 2.7% per year, increase estimated earnings for the average worker by $524 per year, and result in an increase of 17,000 to 29,000 more patents each year for the next 10 years. So if you've never had to sign a non-compete before or you don't know what a non-compete is, it's this agreement that will sometimes accompany an employment contract. It can also be presented as a standalone agreement, but it's an agreement that your

Starting point is 00:03:45 employer will give you that says if you leave that job, you cannot thereafter work in the same industry within a certain amount of time or X number of miles from that job that you're being employed by. And these restrictions can vary, but generally it includes time and geographic scope. And from an employer's perspective, these agreements are beneficial because they're meant to protect trade secrets and otherwise sensitive business information that gets relayed to their employees just by the very nature of the employment. The agreements can also help increase employee retention. They can help maintain as a business your competitive advantage. So employers like non-competes. Employees, on the other hand, don't. It can feel

Starting point is 00:04:33 very restrictive. It can be restrictive if you find yourself looking for a new job close to home after leaving your previous job for one reason or another. Some employees may find themselves in lower paying jobs than they could otherwise get because they can't leave their employer and then go accept a better offer elsewhere because that, you know, new better job falls within the non-compete agreement. So the FTC basically said, well, if we can ban these agreements, employees won't feel so restricted and it may lead to more innovation, increased earnings, all of these things. So January of this year is when the FTC first issued a proposed rule, which under the rule making procedure was then subject to a 90-day public comment period as well as a comment

Starting point is 00:05:16 review period and a revision period before it was ultimately finalized. The basis for the ban stems from the FTC Act. Basically, the FTC said, you know, non-competes are an unfair method of competition, and therefore they violate Section 5 of the FTC Act, which prohibits unfair or deceptive acts or practices, and consequently, we are going to ban them. So that is what they did. Who does this affect? Does this new rule apply to everyone? The answer is pretty much. So the FTC says that existing non-competes for the vast majority of workers will no longer be enforceable after the rule's effective date, which is 120 days from the rule's publication into the federal registrar. The exception here is for senior executives, which are defined

Starting point is 00:06:05 under this rule as those who earn more than $150,164 annually and are in policymaking positions. So existing non-competes for senior executives can remain in force even after this rule takes effect. However, employers cannot enter into new non-competes with any employee going forward, including senior executives. With all of this said, it's important to note that this new rule will almost certainly be challenged. In fact, the United States Chamber of Commerce said yesterday it plans to sue the FTC as early as today. So just note that any legal challenge could delay the effective date. And I could definitely see this case going all the way to the Supreme Court just

Starting point is 00:06:53 because of the implications that this rule has and just the high stakes nature of it. So we'll definitely be on the lookout for that. But as the rule currently stands, it takes effect 120 days from when it's published into the Federal Registrar. Moving on to the second of three final rules we'll cover in this episode, this one released today from the Department of Transportation. Under the Department of Transportation's new final rule, airline passengers are now entitled to a cash refund if their flight is canceled or significantly changed changed and the passenger doesn't accept alternative transportation or travel credits. So this begs the question, what does

Starting point is 00:07:32 significantly changed mean, right? We know what canceled means, but what falls into significantly changed? Lucky for us, the rule gives us an actual definition of significantly changed for the first time. So a significant change includes a delay of more than three hours for domestic flights, a delay of more than six hours for international flights, departures or arrivals from a different airport, so they switch airports on you, an increase in the number of connections, instances where a passenger is downgraded to a lower class, or connections at different airports or flights on different planes that are less accessible or accommodating to a

Starting point is 00:08:10 person with a disability. If you find yourself in any of these situations and you don't accept alternative transportation or travel credits, you are now entitled to a refund under this rule. In addition to the significant changes or cancellation part of the rule, passengers are now also entitled to a refund of their baggage fee if their bag is lost and not delivered within 12 hours of their arrival time on a domestic flight or within 15 to 30 hours of their arrival on an international flight. And 15 to 30 hours is sort of a big range, but the time limit depends on the duration of your flight, so it varies. And then the third

Starting point is 00:08:51 change that this new rule makes is that passengers are now entitled to refunds for the fee paid for an extra service like Wi-Fi, seat selection, or in-flight entertainment, and the airline fails to provide such a service after you pay for it. So you might be wondering, what is new about this? I've been refunded in these scenarios before, what's the change? The big change is that refunds are now automatic. So instead of, you know, having to fill out forms or spending hours on the phone with flight representatives jumping through hoops to fight for your refund, airlines under this rule now have to automatically issue these refunds.

Starting point is 00:09:33 So they'll either be in cash or whatever original payment was used to make the purchase, and airlines can no longer just automatically provide a voucher instead of a refund unless the passenger agrees to it. So that's the deal with the Department of Transportation's rule. Now let's move on to the United States Department of Agriculture's rule. This is the third and final rule we'll talk about. It was also released today. And under the rule, for the first time, the USDA is limiting added sugars in our country's school meals. So the USDA announced a new rule today that not only limits added sugar, but also limits sodium. Before we get to the sugar limits, we'll talk about the sodium limits first. The sodium limits are a little bit more straightforward. Initially, the USDA

Starting point is 00:10:15 officials proposed a 30% reduction in sodium in school meals over the next few years, but after a period of public comment and a directive from Congress, which was included in the most recent appropriations bill, the USDA will now only require a 10% reduction in breakfast meals and 15% reduction in lunches by the start of the 2027-2028 school year. As far as sugar goes, these limits are going to be imposed in a two-phased approach. So phase one is limiting specific high sugar products like cereal, yogurt, and milk. And then phase two will be sort of an overall weekly limit on added sugar. So starting July 2025, breakfast cereal specifically cannot have more than six grams of added sugar per dry ounce. Yogurt cannot have

Starting point is 00:11:07 more than 12 grams of added sugar per 6 ounces. And then flavored milks like chocolate milk cannot have more than 10 grams of added sugar per 8 fluid ounces. So those are the product specific limits. And then starting in July 2027, added sugars will be limited to less than 10% of calories across the week on school menus. This final rule also clarifies that current standards for whole grains remains the same. Starting in the fall of this year, schools will have the option to require unprocessed agricultural products to be locally grown, raised, or caught when making purchases for school meal programs. And then starting in the fall of 2025, schools will have limits on the percentage of non-domestic grown and produced food that they can purchase, which will

Starting point is 00:11:58 in turn benefit American farmers because they'll have to purchase more from American farmers rather than, you know, non-domestically. So those are the three final rules I wanted to touch on. The sixth and final story of the day, actually fifth and final story of the day, is the Supreme Court and the oral arguments that I heard today. So the Supreme Court heard oral arguments in a case dealing with the issue of whether emergency rooms can provide abortions to women in situations where a woman may not be at the risk of death, but instead at the risk of some other health emergency. So we've seen some states implementing these laws, right, where it's a near total abortion ban except when it's necessary to save the life of the mother. And this

Starting point is 00:12:41 particular lawsuit stems specifically from Idaho. So here's the background. We'll start with the laws at issue, and then we'll get into the arguments on each side. And I do just want to note that there are a lot of complex legal and constitutional issues in this case, like the supremacy clause, the spending clause, and just Congress's enumerated powers generally. But I'm really going to stick to the basics of this argument because it'll still give you a good idea of what the issue is here, but without getting too deep into the woods, because if I did, we would be here for hours. So just going to stick to the basics. We'll touch on the supremacy clause a little bit, but you'll still have a well-rounded

Starting point is 00:13:19 understanding of what this case entails. In the aftermath of the Dobbs decision, which overturned Roe v. Wade, Idaho enacted a law called the Defense of Life Act. And that law makes it a crime to provide an abortion unless the abortion is necessary to save the life of the mother or in cases of reported rape or incest. And a copy of the report has been given to the physician. But the Biden administration says that when it comes to laws like this, there is a federal law called the Emergency Medical Treatment and Labor Act, better known as EMTALA, that supersedes these sort of bans. And as we know, per the supremacy clause of the Constitution, federal law always trumps state law. So the federal government says in this case,

Starting point is 00:14:05 because of EMTALA, Idaho's state law cannot take effect because federal law contradicts it. EMTALA requires emergency rooms that participate in Medicare to provide, quote, necessary stabilizing treatment. At the same time, EMTALA also expressly states that it does not trump any requirement imposed by state or local law, except to the extent that the state or local requirement directly conflicts with a requirement imposed by EMTALA. Now, EMTALA says nothing about abortions. Specifically, it does not set forth any sort of specific treatments that emergency rooms are to provide in given scenarios. It just says that it's necessary to provide stabilizing treatment. Because of this, Idaho says there is no direct

Starting point is 00:14:51 conflict that would warrant trumping Idaho's state law, right? Because EMTALA doesn't mention anything about abortions, so in Idaho's view, there's no direct conflict. But to dive a little bit deeper, Idaho argues that in addition to there being no direct conflict, the Medicare Act says that federal officials will not exercise any supervision or control over the practice of medicine or the manner in which medical services are provided. Idaho further argues that EMTALA was enacted to ensure emergency rooms don't turn away lower-income patients. EMTALA seeks to ensure all patients are treated the same regardless of insurance coverage or socioeconomic status. And that, according to Idaho, is what EMTALA is and that is its purpose. EMTALA's purpose is not to require abortion procedures. It specifically says it's not intended to trump state law except where a direct conflict exists and therefore,

Starting point is 00:15:47 according to Idaho, the government's argument must fail. The government rebuts Idaho's assertions by arguing that EMTALA has a bigger purpose than just merely preventing patient dumping. In the government's view, the law promises essential emergency care to all Americans, which means that when a woman, when a pregnant woman experiences an emergency medical condition that makes continuing a pregnancy a grave threat to her life or health, pregnancy termination is essential medical care. The government notes that it has long interpreted EMTALA to require hospitals offer abortions as

Starting point is 00:16:24 stabilizing treatment dating back to the George W. Bush administration, but it's never been an issue because it wasn't until 2022 that Roe v. Wade was overturned. And then finally, the government says, look, we're not asking for every provision of Idaho's law to be voided. We understand that EMTALA only trumps state law when state law directly conflicts with the provisions and requirements set forth in EMTALA. Because of that, we're only asking that the state not prohibit emergency care in the form of an abortion in the narrow circumstances covered by EMTALA. When a woman comes into the emergency room and needs an abortion to

Starting point is 00:17:05 prevent serious adverse health effects, but not necessarily death, we believe EMTALA covers that patient. And the state should not be allowed to say, nope, you know, unless you're dying, sorry, abortion is off the table. So to recap and sum up these arguments into two short sentences. On one hand, you have the government who argues that EMTALA requires hospitals who participate in Medicare to provide stabilizing treatment to patients who present themselves to the emergency room. And in some cases, a stabilizing treatment may be an abortion procedure even when the mother's life is not at risk. And therefore, federal law trumps state law and renders the state law unenforceable. On the other hand, you have Idaho arguing that this EMTALA argument is simply a power grab. Nothing in EMTALA is in

Starting point is 00:17:58 direct conflict with Idaho's law, and therefore, the state law can remain in place, there's no problem. Federal law does not trump. So the district court hears this case first and sides with the Biden administration. And the district court issues an order that prohibits Idaho from enforcing the law. Idaho then appeals to the Ninth Circuit and requests that the appellate court put the district court's holding on pause while the state appeals the case. And effectively, that would have allowed the state to enforce the ban while the case was up on appeal, but the appellate court denied that request. So then Idaho takes it to the Supreme Court, and they ask the justices to do what the appellate court wouldn't do and put

Starting point is 00:18:41 the district court's ruling on hold while the appellate court considers the merits of the case. And this past January, what the Supreme Court did is they said, okay, we're going to put the district court's order on hold, meaning this ban can be enforced temporarily, but we're also going to set this case for oral arguments and we are going to decide the merits of this case. And that's why arguments were had today. The parties were arguing the merits of this case. And that's why arguments were had today. The parties were arguing the merits of the case before the Supreme Court because the Supreme Court agreed to decide this matter. So how did the justices react? The three liberal justices, Justices Sotomayor, Kagan, and Jackson, they'll vote in favor of the government. They will side with the

Starting point is 00:19:23 government. They really grilled into the attorney for Idaho about situations where a woman may be at risk of serious health issues, but may not be at death's door. They were very, very concerned about that. Justices Gorsuch, Alito, and Thomas appear to be on Idaho's side. Specifically, Gorsuch and Alito had a good amount of issues with the spending clause, which we didn't get into in this discussion, but it seems they're leaning in Idaho's favor. Chief Justice Roberts and Justices Barrett and Kavanaugh seemed more in the middle. It's hard to kind of pin them on one side or the other. They had questions for both sides that were a little bit difficult. I do think this is going to be a narrow 5-4 decision. My gut is telling me it'll be in favor of Idaho, but I'm also not 100% confident with

Starting point is 00:20:09 that prediction. There are some cases where I'm, you know, I'm pretty confident to say this is going one way or the other, but it could go either way in this case. I do think it will be 5-4 though. Don't forget also the justices are hearing oral arguments in Trump's presidential immunity case tomorrow. So stay tuned for my update on that. I'll be uploading that obviously tomorrow afternoon and that'll be the final episode of the week. So that is what I have for you today. Thank you so much for being here. Have a great rest of your night and I will talk to you

Starting point is 00:20:40 tomorrow.

UNBIASED - April 24, 2024: SCOTUS Hears Abortion Ban Arguments, Here's How the Justices Are Leaning; FTC Bans Non-Competes; USDA Sets Limits on Sugar in Schools, DOT Requires Airline Refunds, and More.

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