Supreme Court Justice Samuel Alito’s outlier practice of holding individual stocks continues to cause needless issues.
The latest instance came in a case called Chevron USA v. Plaquemines Parish, which is scheduled for oral argument on Monday. Oil and gas companies want to move environmental-damage litigation against them from Louisiana state court to federal court, where the companies seem to think they’d have an easier time.
Alito recused himself from the case Thursday, just days ahead of the hearing and several months after the court agreed to review the appeal and the parties filed their briefs. A justice’s recusal is typically noted when the court grants review.
But Alito’s last-minute exit means that an eight-justice court will now hear and decide the high-stakes case. The belated move is at once laudable, problematic and the latest example of a perplexing phenomenon.
A letter from the court’s clerk, filed on the docket Thursday, Jan. 8, said Alito was stepping aside because of his financial interest in ConocoPhillips, the parent corporation for Burlington Resources Oil and Gas Co. Burlington was among the companies that initially petitioned the high court to hear the case, but it withdrew from the petition in May, while the court’s decision about whether to grant review was still pending. The justices then granted review in June. (It takes four votes to grant review, and the vote tally isn’t public.) But later briefing “noted that Burlington remained a party in the district court,” the one-paragraph letter on Alito’s behalf concluded.
It’s worth pausing for a moment to consider Burlington’s withdrawal and how it highlights problems posed by Alito’s practice of holding individual stocks.
The company’s two-sentence letter in May didn’t give any reason for backing out. It merely said it was withdrawing from the then-pending petition and that neither it nor ConocoPhillips would be a party to, or have any involvement in, the case going forward.
Alito’s explanation for his initial nonrecusal implied that he would have recused had the company not withdrawn and the court granted review.
That raises a couple of issues.
One is the company’s withdrawal, potentially for the purpose of letting Alito participate in the case. Whatever the company’s motivation, that was, in the justice’s explanation, the effect of its withdrawal.
A second, related issue is whether the withdrawal removed an ethical conflict. Even if the company hadn’t remained a party in the district court, the justice still would have been deciding a case that affected the bottom line of a company in which he has a direct financial interest. That the company would no longer be an active participant in the litigation wouldn’t suddenly remove all ethical issues. A win for the corporate interests would still benefit the company in which the justice is literally invested.
Of course, one could argue lazily that the justices’ actions in any case could affect their finances. But one needn’t resort to such hazy, extreme logic to draw a reasonable line for recusal at least at the point that a party petitions for review. That would prevent a withdrawal that seeks to game the system in the middle of litigation.
At any rate, it’s a good thing that Alito recused himself, due to the apparent conflict that would arise from deciding a case in which he has a financial stake. But the situation highlights the underlying issue of his choice to hold individual stocks. A 2024 Bloomberg report noted that he’s the only justice “with a stake in more than two dozen individual companies” and that most justices own mutual funds, which don’t create the same conflicts posed by individual stocks.
When an even-numbered court hears a case, that creates the possibility of a tie vote. When there’s a tie, that effectively upholds the lower court ruling that was challenged on appeal. Notably in this Chevron case, the companies lost in the lower court, so a tie would be a loss for them. If Alito was poised to side with the companies, then his investment removed any advantage his vote would have given the industry in which he’s invested.
Obviously, then, this isn’t a partisan point (though Alito’s latest recusal also serves to spotlight his refusal to step aside from other cases that raised more overtly political issues, like Jan. 6 prosecutions). If anything, the justice’s supporters should be more passionate than anyone about keeping him in play for as many cases as possible. Therefore, it continues to be strange that he chooses to put his availability to do his job in doubt.
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