Exxon Shipping Co. v. BakerFacts of the Case: The Exxon Valdez supertanker ran aground in Alaska’s Prince William Sound in 1989 while under the command of Joseph Hazelwood, a relapsed alcoholic. Exxon knew that Hazelwood had resumed drinking but did not relieve him of his post, and the ship eventually spilled 11 million gallons of oil into the ecologically sensitive sound. The jury calculated compensatory damages at $287 million, and then awarded $5 billion in punitive damages. The punitive award has been reviewed three times by the Ninth Circuit Court of Appeals, which ultimately settled on a $2.5 billion figure. In a dissent from the full court’s denial of rehearing in the third review of the award, Judge Alex Kozinski posited that any award, no matter its size, violated the maritime law rule that a ship owner need not pay for the reckless actions of an employee.

Question: Does maritime law permit judges to award punitive damages for employee misdeeds and does maritime law allow judge-made remedies when Congress has not authorized them?

Conclusion: Maybe and yes. With Justice Samuel Alito taking no part in the decision because he owns Exxon stock, the Court split evenly 4-4 on the issue of whether judges may award punitive damages against a company for employee misdeeds. Therefore, the Court left the Ninth Circuit's ruling that they can undisturbed, but noted that this affirmation could not be used as precedent because it merely reflected an even split in the Court. On the second issue, a 5-4 majority held that judges are free to create remedies in maritime cases where Congress has not legislated in the area. However, this freedom can be lost if Congress passes legislation restraining such judicial activism. Justice David Souter delivered the opinion of the Court. Justice Antonin Scalia, joined by Justice Clarence Thomas, wrote a concurring opinion, agreeing with the Court's application of punitive damages precedent but arguing that those prior holdings were in error. Justice John Paul Stevens concurred in part and dissented in part, stating that Congress, not the courts, should be the sole body entrusted with determining the permissibility of punitive damages. Justice Stephen Breyer also concurred in part and dissented in part, arguing that the punitive damages in this case should have been reduced.

Beauharnais v. IllinoisFacts of the Case: Joseph Beauharnais, president of White Circle League, Inc., was arrested on January 7, 1950 for distributing leaflets on Chicago street corners. The leaflets called in part upon the mayor and aldermen of Chicago "to halt the further encroachment, harassment and invasion of white people…by the Negro." Beauharnais was charged with violating an Illinois law making it illegal to distribute any publication that "exposes the citizens of any race, color, creed or religion to contempt, derision, or obloquy." A jury found him guilty and he was fined $200. The Illinois Supreme Court affirmed his conviction.

Question: Did Beauharnais' conviction under the Illinois statute violate his constitutional right to free speech under the First and Fourteenth Amendments?

Conclusion: No. In a 5 – 4 opinion authored by Justice Felix Frankfurter, the Court concluded that Beauharnais' speech amounted to libel and was therefore beyond constitutional protection. Citing the racial tensions of the day, the Court characterized Beauharnais' speech as provocative and rejected the argument that the Illinois statute could be easily abused, stating, "Every power may be abused, but the possibility of abuse is a poor reason for denying Illinois the power to adopt measures against criminal libels sanctioned by centuries of Anglo-American law."

United States v. Carolene Products Co.Facts of the Case: A 1923 act of Congress banned the interstate shipment of "filled milk" (milk with skimmed milk and vegetable oil added). A manufacturer, indicted for shipping filled milk, challenged the law.

Question: Does the law violate the Commerce Power granted to Congress in Article Section 8 and the Due Process Clause of the Fifth Amendment?

Conclusion: The Court upheld the act. In this otherwise unremarkable case, the Court planted the seeds for a new jurisprudence in a footnote to Stone's opinion for the Court. Here Stone gives a presumption of constitutionality to economic regulation. The Court would no longer substitute its views on economic policy for the views of Congress. Stone went further in footnote four by cautiously asserting that certain types of legislation might not merit deference toward constitutional validity. The most controversial element in the footnote was the suggestion that prejudice directed against discrete and insular minorities may call for "more searching judicial inquiry."