June 7, 2012

En banc Ninth Circuit state law question to the California Supreme Court

As it’s allowed to do, the Ninth Circuit regularly asks the California Supreme Court to answer questions of state law. Normally, the request comes from a three-judge panel. Yesterday, however, an 11-judge en banc Ninth Circuit court asked for help.

In Beeman v. Anthem Prescription Management, LLC, the Ninth Circuit asked for a determination whether “California Civil Code section 2527 compel[s] speech in violation of article I, section 2 of the California Constitution.” The court explained that “[t]he statute requires drug claims processors to generate studies about pharmacy pricing, summarize the results and disseminate the information to their clients.”

Besides the fact that the state law question comes from an en banc court, the request has another interesting twist. The Ninth Circuit acknowledged that California’s Courts of Appeal have consistently found section 2527 unconstitutional and that those decisions would usually establish what California’s law is for the federal appeal. But the initial Ninth Circuit opinion in Beeman went the other way.

The en banc court explained, “the panel majority was convinced that the California Supreme Court would decide the question differently. The panel majority concluded that the California Supreme Court would interpret its free speech clause by relying on federal judicial interpretations of the First Amendment to the U.S. Constitution, and conclude that the ‘statute is constitutional under the First Amendment.’ ”

With the Ninth Circuit panel deciding differently from unanimous California Court of Appeal decisions (one of them published), and the Ninth Circuit decision binding federal district courts in the Circuit just as the published Court of Appeal decision binds California superior courts, the Ninth Circuit felt it had no choice but to go en banc for the purpose of asking the Supreme Court to resolve the conflict. Otherwise, the Ninth Circuit said, “were the panel holding to stand without the California Supreme Court deciding the question, plaintiffs would be able to sue in federal court to enforce the state statute, but could not sue in state court to enforce the very same statute.”

The Beeman request is similar to that in Hayes v. County of San Diego, where, as we reported, a 3-judge Ninth Circuit panel disagreed whether the California Supreme Court would agree with certain California Court of Appeal decisions. In Hayes, however, the panel granted rehearing so it could ask the Supreme Court for a resolution.

The Supreme Court agreed to answer the question in Hayes. It will likely do the same in Beeman. However, the court could deny the Ninth Circuit’s request and simply indicate in the denial order that the California Court of Appeal got it right. The Supreme Court has made that kind of order before. Moreover, the Supreme Court denied review in the one California Court of Appeal case cited in Beeman in which review was sought and three justices — including two current members of the court — recused themselves. The lack of interest the last time the issue was presented and the possibility of additional recusals might lead the court to deal with Beeman summarily.

The Supreme Court has already docketed the request and will likely decide by the beginning of August whether it will answer this question.

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