October 2022 LEMR
FEATURED ARTICLE
The Business Interests of Judicial Spouses
Over the past several years an increasing number of commentators have begun to question the propriety of Ginni Thomas’s political and business activities in situations where her husband, United States Supreme Court Justice Clarence Thomas, might be involved in hearing cases related to these interests. The press has begun to follow up on the broader question of whether federal judges should be required to disclose certain business interests of their spouses.1 It has been pointed out that four Supreme Court Justices—Justice Thomas, Justice Amy Coney-Barrett, Justice Ketanji Brown Jackson, and Chief Justice Roberts—have spouses who are lawyers or lobbyists. Most recently, on October 18, 2022, four progressive watchdog groups sent a letter to members of Congress asking them to consider passing legislation that would require all federal judges—not just members of the U.S. Supreme Court—to disclose more extensive information about their spouses’ business interests.
To be clear, the letter does not request changes to the federal rules on judicial recusal. These already exist in 28 U.S.C. §455:
(a) Any justice, judge, or magistrate judge of the United States shall disqualify himself in any proceeding in which his impartiality might reasonably be questioned.
(b) He shall also disqualify himself in the following circumstances:
(1) Where he has a personal bias or prejudice concerning a party, or personal knowledge of disputed evidentiary facts concerning the proceeding;
(2) Where in private practice he served as lawyer in the matter in controversy, or a lawyer with whom he previously practiced law served during such association as a lawyer concerning the matter, or the judge or such lawyer has been a material witness concerning it;
(3) Where he has served in governmental employment and in such capacity participated as counsel, adviser or material witness concerning the proceeding or expressed an opinion concerning the merits of the particular case in controversy;
(4) He knows that he, individually or as a fiduciary, or his spouse or minor child residing in his household, has 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;
(5) He or his spouse, or a person within the third degree of relationship to either of them, or the spouse of such a person:
(i) Is a party to the proceeding, or an officer, director, or trustee of a party;
(ii) Is acting as a lawyer in the proceeding;
(iii) Is known by the judge to have an interest that could be substantially affected by the outcome of the proceeding;
(iv) Is to the judge’s knowledge likely to be a material witness in the proceeding.
(c) A judge should inform himself about his personal and fiduciary financial interests, and make a reasonable effort to inform himself about the personal financial interests of his spouse and minor children residing in his household.
(d) For the purposes of this section the following words or phrases shall have the meaning indicated:
(1) “proceeding” includes pretrial, trial, appellate review, or other stages of litigation;
(2) the degree of relationship is calculated according to the civil law system;
(3) “fiduciary” includes such relationships as executor, administrator, trustee, and guardian;
(4) “financial interest” means ownership of a legal or equitable interest, however small, or a relationship as director, adviser, or other active participant in the affairs of a party, except that:
(i) Ownership in a mutual or common investment fund that holds securities is not a “financial interest” in such securities unless the judge participates in the management of the fund;
(ii) An office in an educational, religious, charitable, fraternal, or civic organization is not a “financial interest” in securities held by the organization;
(iii) The proprietary interest of a policyholder in a mutual insurance company, of a depositor in a mutual savings association, or a similar proprietary interest, is a “financial interest” in the organization only if the outcome of the proceeding could substantially affect the value of the interest;
(iv) Ownership of government securities is a “financial interest” in the issuer only if the outcome of the proceeding could substantially affect the value of the securities.
(e) No justice, judge, or magistrate judge shall accept from the parties to the proceeding a waiver of any ground for disqualification enumerated in subsection (b). Where the ground for disqualification arises only under subsection (a), waiver may be accepted provided it is preceded by a full disclosure on the record of the basis for disqualification.
(f) Notwithstanding the preceding provisions of this section, if any justice, judge, magistrate judge, or bankruptcy judge to whom a matter has been assigned would be disqualified, after substantial judicial time has been devoted to the matter, because of the appearance or discovery, after the matter was assigned to him or her, that he or she individually or as a fiduciary, or his or her spouse or minor child residing in his or her household, has a financial interest in a party (other than an interest that could be substantially affected by the outcome), disqualification is not required if the justice, judge, magistrate judge, bankruptcy judge, spouse or minor child, as the case may be, divests himself or herself of the interest that provides the grounds for the disqualification.2
Instead, the debate at the moment is over greater transparency in the financial disclosure rules. Currently, federal judges must disclose the name of a spouse’s employer, but they are not required to disclose clients of an employer or the amount of compensation received from a job.3
The letter sent to Congress is short but clear:
October 18, 2022
Dear Chairmen Durbin, Whitehouse, Nadler and Johnson; Ranking Members Grassley, Kennedy, Jordan and Issa:
We, the undersigned organizations, write to encourage you to draft legislation that will close a disclosure loophole in the judiciary and ensure that judges, justices and the American people can more fully appreciate and account for potential judicial conflicts of interest.
Our recommendation comes as a new report1 has illustrated how the work of several judicial spouses — those in the legal and legal services industries and those who do consulting work2 — might intermingle with the cases and petitions considered by the Supreme Court. These concerns are no doubt more acute in circuit and district courts, which, including senior judges, comprise close to 1,400 jurists.
We therefore seek the following insertion into 5 U.S.C. App. § 102(e)(1), with the current subsections (B) through (F) being redesignated as (C) through (G):
“(B) If a spouse renders legal services; strategic or legal advice related to litigation, lobbying, or business activities; lobbying or public relations services; or testimony as an expert witness, and the value of that service, advice, or testimony in the reporting year is greater than $5,000 or its equivalent in billable hours or bonuses, then the name of the payor for that service, advice, or testimony and the amount of compensation need be reported.”
We believe $5,000 to be the proper threshold since that number is used elsewhere in government financial disclosure rules as a reporting floor, including in the rules that govern reporting of major clients by incoming officials and nominees.3
We applaud your recent work4 to ensure that judges’ and justices’ annual disclosures reports and reports on their stock transactions are posted online in a timely manner. We hope we can work with you in the coming weeks to improve judicial disclosures once more.
Sincerely,
Citizens for Responsibility and Ethics in Washington (CREW)
Free Law Project
Fix the Court
Project On Government Oversight
1 See Hailey Fuchs, Josh Gerstein and Peter S. Canellos, “Justices shield spouses’ work from potential conflict of interest disclosures,” Politico, Sept. 29, 2022 (link)
2 Jane Roberts is managing partner at legal recruiting firm Macrae, where she “advises high-profile law firm partners and […] senior government attorneys” (link); Ginni Thomas is president of Liberty Consulting (link), which has been involved in several high- profile political and policy battles in Washington; Jesse Barrett in 2021 opened the Washington-based practice for Southbank Legal (link); and Patrick Jackson receives “self-employed consulting income […] from consulting on medical malpractice cases” (link)
3 See 5 U.S.C. App. § 102(a)(6)(B); U.S. Office of Government Ethics, Financial Disclosure Reporting Guidelines, § 2.07: Part 4
4 See the Courthouse Ethics and Transparency Act, P.L. 117-125
Many commentators have argued that this change is not only desirable, but necessary. Nevertheless, if one thinks about this in terms of the rights of a judicial spouse, then the question of whether expanding the judicial financial transparency rules becomes more complex. One must ask what effect such rules might have on the spouse, the spouse’s employer, and the spouse’s employer’s clients.
The arguments for transparency are certainly strong: litigants—and the public—should have as much information about potential judicial conflicts as possible to determine whether to move for a judge to recuse herself. Furthermore, were judges required to disclose more information about spousal activities, this would increase pressure on them to recuse themselves in borderline cases.
However, the difficulty with the letter’s proposal to increase transparency is that it may cause significant disruption to a spouse’s legal or lobbyist practice—to the point that some judicial spouses may have to give up their professional activities entirely. Such a possibility might well be a reason why potential judges will decline to go on the bench.
In the end, much of the controversy over disclosure of spousal activities comes from a growing distrust of our judiciary. This, in itself, is highly problematic. It is not clear that increasing disclosure will solve this problem. If some judges are disinclined to follow the conflicts and recusal rules, is it likely that they will make required disclosures?
The bar and the judiciary should have serious discussions about the proposals and have input into any proposed legislation on this issue.
Read this month’s edition of LEMR
References:
- The journal Politico has reported on this and published several articles on this subject that we used in writing this column, the last of which is available online at https://www.politico.com/news/2022/10/20/judicial-activists-income-judges-spouses-00062670.
- This section, in effect, gives U.S. Supreme Court Justices a free pass since there is no higher judicial authority in the federal court system.
- See https://www.uscourts.gov/rules-policies/judiciary-policies/ethics-policies/financial-disclosure-report-regulations.
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