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| Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., No. 82-354,
SUPREME COURT OF THE UNITED STATES, June 24, 1983, Decided **Together with No. 82-355, Consumer Alert et al. v. State Farm Mutual Automobile Insurance Co. et al.; and No. 82-398, United States Department of Transportation et al. v. State Farm Mutual Automobile Insurance Co. et al., also on certiorari to the same court.
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Overview: Under authority of the National Traffic and Motor Vehicle Safety Act of 1966 (Act), 15 U.S.C.S. ¿ 1381 et seq., the National Highway Traffic Safety Administration (NHTSA) promulgated Standard 208 to require installation of seatbelts in all automobiles. Subsequently, the NHTSA promulgated rules to require passive restraint systems in new vehicles, but then rescinded the requirement on the basis that it was no longer able to find that the requirement would produce significant safety benefits. Respondent automobile insurers filed petitions for review of the NHTSA's rescission. The district court held that the NHTSA's rescission was arbitrary and capricious. Petitioners sought a writ of certiorari, which was granted. The court held that the NHTSA failed to present an adequate basis and explanation for rescinding the passive restraint requirement and required the NHTSA to either reconsider the restraint issue further, or amend Standard 208 to comply with the supporting analysis. The court held that under the "arbitrary and capricious" standard of judicial review, the NHTSA failed to provide clear and convincing reasons for its action to abandon the passive restraint system.
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| Dirks v. SEC, No. 82-276,
SUPREME COURT OF THE UNITED STATES, July 1, 1983, Decided
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Overview: Petitioner was an officer of a broker-dealer firm and specialized in investment analysis of insurance company securities to investors. Petitioner received information that a corporation had vastly overstated assets. Petitioner discussed this information with clients, and some of those clients sold holdings in the corporation. When respondent learned of petitioner's actions, respondent found that petitioner aided and abetted violations of ¿ 17(a) of the Securities Act of 1933, 15 U.S.C.S. ¿ 77q(a), and ¿ 10(b) of the Securities Exchange Act of 1934, 15 U.S.C.S. ¿ 78j(b), by repeating the allegations to members of the investment community. In a divided opinion, the appellate court found against petitioner and he sought the Court's review. The U.S. Supreme Court held there was no actionable insider-trading violation by petitioner where petitioner was a stranger to the corporation, had no fiduciary duty to corporation's shareholders, did not try to gain corporate shareholder's confidence, and did not illegally obtain the information about the corporation. Therefore, petitioner had no duty to abstain from the use of the inside information, and the lower court's judgment was reversed.
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| Marsh v. Chambers, No. 82-23,
SUPREME COURT OF THE UNITED STATES, July 5, 1983, Decided
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Overview: In an action challenging the practice of employing a chaplain to open each legislative session with a prayer, the district court held only that the payment of the chaplain with public funds was unconstitutional, and did not enjoin the practice of opening each session with a prayer. The appellate court held the entire practice unconstitutional. The Court reviewed the long history of opening legislative sessions with prayers. It held that the founding fathers certainly did not view the practice as violating the Establishment Clause because in the same week as they approved a draft of the First Amendment for submission to the states they also voted to appoint and to pay a chaplain for each house. The Court noted that the practice had become part of the fabric of society, and fears that it would lead to the establishment of a national religion were unfounded. The Court held that the remuneration of the chaplain from public funds was a longstanding practice, initiated by Congress, which did not violate the Establishment Clause. The fact the current chaplain had been reappointed to the position for 16 years did not violate the Establishment Clause.
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| Mich. v. Long, No. 82-256,
SUPREME COURT OF THE UNITED STATES, July 6, 1983, Decided
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Overview: The police officers found marijuana in the passenger compartment and in the trunk of the vehicle that respondent was driving. The officers searched respondent's vehicle because they had reason to believe that the vehicle contained weapons potentially dangerous to the officers. At issue was whether a protective search for weapons could extend to an area beyond the person in the absence of probable cause to arrest. Articles inside the relatively narrow compass of the passenger compartment of an automobile were within the area into which a suspect might reach in order to grab a weapon. Protection of police officers justified protective searches when the officers had a reasonable belief that the suspect posed a danger, especially during roadside encounters. As such, the search of respondent's vehicle was permissible since it was limited to those areas where a weapon could have been placed or hidden.
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