WASHINGTON — The Supreme Court tossed itself off a big case Monday.
The court couldn’t take up an apartheid dispute involving some of the nation’s largest companies because too many of the justices had investments or other ties with those corporate giants.
It appeared to be the first time in at least a quarter-century that the justices’ financial holdings prevented them from taking a case.
The result is that a lawsuit will go forward accusing dozens of corporations of violating international law by assisting South Africa’s former apartheid government. The companies and the Bush administration had asked the court to intervene, arguing that the lawsuit was damaging international relations, threatening to hurt South Africa’s economic development and punishing the companies using a fuzzy legal concept.
Four of the nine justices sat out the court’s consideration of the case. Federal law calls for at least six to hear any case.
Short of the required number, the court took the only path available to it and upheld an appeals- court ruling allowing the lawsuit to proceed.
Chief Justice John Roberts and Justices Samuel Alito, Stephen Breyer and Anthony Kennedy provided no explanation for their decision not to take part in the case.
But those justices have ties to Bank of America Corp., Bristol-Myers Squibb Co., Colgate-Palmolive Co., Credit Suisse, Exxon Mobil Corp., Hewlett-Packard Co., IBM and Nestle SA, among nearly three dozen companies that asked the high court to step in.
New York University law professor Stephen Gillers, an expert on judicial ethics, said he expects this issue to arise from time to time.
“Whether it’s family relationships or wealth, this is going to happen,” Gillers said. “It hasn’t reached the point where we need to do something.”
Justices maintain control over their investment portfolios and should take steps to minimize conflicts, said Arthur Hellman, an ethics expert at the University of Pittsburgh law school.
Indeed, Congress passed a law in 2006 that allows all federal judges to sell shares of stock and reinvest the proceeds in mutual funds and other investments without immediately having to pay capital-gains tax on the profits.
Hellman said of the current case: “This decision is particularly disturbing because the law was specifically designed to cure the problem of justices being reluctant to sell certain stocks because of capital-gains consequences.”
