Legal News for Tues 10/22 - Questionably Legal Musk Election Giveaway, PFAS Settlement, Murdoch/Dow Jones Sues Perplexity, Michigan Overseas Voting Case and Uniformity in Sales Tax

Minimum Competence

This Day in Legal History: Robert Bork Nomination Rejected

On October 23, 1987, the U.S. Senate rejected President Ronald Reagan’s nomination of Robert H. Bork to the Supreme Court by a vote of 42-58. This rejection was a pivotal moment in U.S. legal and political history, marking one of the most contentious Supreme Court nomination battles. Bork, a former solicitor general and judge on the D.C. Circuit Court of Appeals, was known for his strict originalist interpretation of the Constitution, which raised concerns about how his judicial philosophy might affect rulings on civil rights, privacy, and women's rights.

Bork's nomination ignited intense public opposition, particularly from civil rights organizations, women’s rights groups, and liberal advocacy organizations. These groups feared that his conservative views on issues like abortion, affirmative action, and privacy rights would roll back decades of legal progress. His academic writings and controversial role in the Saturday Night Massacre during the Watergate scandal, when he followed President Nixon’s orders to fire the special prosecutor investigating the case, further fueled opposition.

The Senate’s rejection of Bork is widely seen as a turning point in the politicization of Supreme Court nominations, where ideology became a key battleground. The term “borking” was coined to describe the aggressive campaigning and lobbying used to derail a judicial nomination. This event reshaped how future judicial nominations would be approached, with increased scrutiny on nominees' legal philosophies and the political stakes of Supreme Court appointments.

Elon Musk's $1 million election giveaway has sparked debate over whether it violates federal laws prohibiting payment to register or vote. The giveaway, which selects daily winners from those who sign Musk's petition supporting the First and Second Amendments, targets key battleground states ahead of the 2024 U.S. presidential election. Legal experts are split on its legality.

Some argue that it could be viewed as indirectly incentivizing voter registration, particularly since participants must be registered voters in specific states. Critics, including Pennsylvania's Governor Josh Shapiro, are calling for investigations, citing concerns about potential violations. Others, like former Federal Election Commission chair Brad Smith, believe Musk is not violating the law because signing the petition isn't directly tied to registering to vote. The controversy centers on whether Musk's actions are a clever mobilization tactic or a breach of election law.

Elon Musk's $1 million election giveaway tests limits of election law | Reuters

Carrier Global has agreed to a $730 million settlement related to PFAS contamination claims against its bankrupt fire protection unit, Kidde-Fenwal. The settlement will resolve lawsuits over toxic chemicals, known as PFAS or "forever chemicals," found in Kidde-Fenwal’s firefighting foam products, which allegedly polluted water and soil near U.S. airports and military bases.

The settlement allocates $540 million to Kidde-Fenwal and $190 million to the plaintiffs. Carrier will fund $615 million over five years and use $115 million from the sale of Kidde-Fenwal’s assets. Additionally, Carrier expects up to $2.4 billion in insurance payouts to cover costs. Kidde-Fenwal filed for bankruptcy in May 2023 amid over 4,400 PFAS-related lawsuits. This settlement follows other major PFAS agreements, such as 3M’s $10.3 billion and DuPont’s $1.19 billion settlements.

Carrier reaches $730 mln settlement over fire protection unit PFAS claims | Reuters

Rupert Murdoch's Dow Jones and the New York Post have filed a lawsuit against Perplexity AI, accusing the startup of illegally copying their copyrighted content to generate AI-based responses. The lawsuit highlights a broader conflict between publishers and tech companies over the unauthorized use of copyrighted material for AI training and content generation. Perplexity, which competes in the search engine market, provides AI-generated summaries from various sources, including material from Dow Jones and the New York Post.

The lawsuit claims that Perplexity's system reproduces content verbatim without permission, constituting copyright infringement. Dow Jones and the *New York Post* seek to stop Perplexity from using their content and demand the destruction of databases built using their work. Despite attempts to negotiate a licensing deal, Perplexity did not respond. The case reflects growing tensions between media organizations and AI companies, as publishers push for compensation for the use of their content.

Murdoch's Dow Jones, New York Post sue Perplexity AI for 'illegal' copying of content | Reuters

A Michigan judge rejected a Republican effort to restrict overseas voting in the state. The Republican National Committee (RNC) had filed a lawsuit claiming Michigan’s election laws improperly allowed U.S. citizens living abroad, who had never resided in the state but had relatives there, to vote. Judge Sima Patel ruled that the challenged language in the law aligns with federal and state regulations. According to Michigan law, U.S. citizens who have never lived in the U.S. can vote in Michigan if a parent, guardian, or spouse last resided there, as long as they haven’t registered in another state. The RNC did not immediately respond to the decision.

Judge rejects Republican move to restrict overseas voting in Michigan | Reuters

In my column for Bloomberg this week I argued for the need to establish a uniform state sales tax system to alleviate the burdens on small businesses and remote sellers. The current fragmented system, with over 13,000 tax jurisdictions, creates significant compliance challenges. Since the Supreme Court's South Dakota v. Wayfair decision in 2018, remote sellers are now required to navigate a complex patchwork of tax rules across states, which hampers interstate commerce. A proposal by Senator Maggie Hassan to standardize sales tax policies has drawn opposition from states concerned about losing autonomy, but the economic harm caused by the status quo warrants congressional intervention.

Small businesses are disproportionately affected, as they are often required to track taxes across multiple states, increasing administrative costs. A federal solution, like Hassan’s proposal, could simplify this with exemptions for small sellers and protections for good-faith tax collection errors. Offering federal incentives for states to modernize their tax systems could help ease the transition. By building on existing frameworks, such as the Streamlined Sales and Use Tax Agreement, a collaborative approach can balance state sovereignty with the need for a more consistent tax system that supports commerce.

We Need a Uniform State Sales Tax System That Supports Commerce

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