Alito Financial Conflict of Interest Demonstrates Need for Supreme Court Ethics Standards

Supreme Court Justice Samuel Alito admitted yesterday that he unlawfully heard a case involving Disney subsidiary ABC while he owned Disney stock. Federal law requires Supreme Court justices to recuse themselves from hearing a case if they have “a financial interest in the subject matter in controversy or in a party to the proceeding, or any other interest that could be substantially affected by the outcome of the proceeding.”

FCC v. Fox Television Studios involved a challenge to FCC regulations banning “fleeting expletives” during television broadcasts. The FCC fined several stations, including ABC, for single instances of performers uttering foul language during broadcasts. The stations challenged the fines on First Amendment grounds. The Supreme Court rejected the challenges in a 5-4 vote in which Justice Alito voted with the majority.

Justice Alito stated that he was not aware of the conflict when he heard the case in 2008. Nonetheless, had one of the parties filed a motion to recuse, Alito would have been the sole decisionmaker to determine whether his stock holdings required him to recuse. (Of course, the parties would be unlikely to know of Justice Alito’s holdings since he had forgotten himself, but recusal motions can be filed and applied retroactively. See Liljeberg v. Health Services Acquisition Corp., 486 U.S. 847 (1988)).

Recent reports indicate Justice Breyer sold between $15,000 and $50,000 in Wal-Mart stock prior to hearing Wal-Mart v. Dukes, which is the proper course of action if a Justice wants to avoid recusal. If Breyer had kept his Wal-Mart stock, however, he also would have been the sole person to decide whether to recuse. Had he chosen to hear the case in violation of the rules, the only recourse would be impeachment. Unlike lower courts, a Supreme Court justice’s recusal decision is not reviewable.

Both cases demonstrate the need for stronger ethics and recusal standard that will hold the Supreme Court to the same standards by which lower courts must abide. Click here for more information about AFJ’s work on judicial ethics.