WASHINGTON — In a pair of 5-to-4 decisions issued on Tuesday, the Supreme Court ruled in favor of an injured airline mechanic and against a registered nurse who said her pay had been unfairly docked.
Both rulings divided along familiar ideological lines, and only Justice Anthony M. Kennedy was in the majority in both. The dissenters in each case accused the majority of manipulating the judicial process to address a question not properly before the court.
The case concerning the airline mechanic, James E. McCutchen, arose from a car accident in which he was badly injured. His employer, US Airways, paid his medical expenses of $66,866.
Mr. McCutchen sued the other driver and received a payment from his own insurer, recovering a total of $110,000. Forty percent of that went to his lawyers, leaving him with $66,000, or a little less than US Airways had paid.
The company’s health plan required Mr. McCutcheon to reimburse it for what it had paid out if he recovered money from a third party. The question for the justices was whether that meant every penny he had received plus $866 or something less.
Justice Elena Kagan, writing for the majority, said the words of the health plan were “silent on the allocation of attorneys’ fees” and could be read in two ways: requiring Mr. McCutchen to pay back “every dollar received from a third party” or “only the true recovery, after the costs of it are deducted.”
Given that ambiguity, she wrote, ordinary fairness required the second interpretation.
“Third-party recoveries,” she wrote, “do not often come free: To get one, an insured must incur lawyers’ fees and expenses. Without cost sharing, the insurer free rides on its beneficiary’s efforts — taking the fruits while contributing nothing to the labor. Odder still, in some cases indeed, in this case — the beneficiary is made worse off by pursuing a third party.”
“US Airways claimed $66,866 in medical expenses,” she added. “That would put McCutchen $866 in the hole; in effect, he would pay for the privilege of serving as US Airways’ collection agent.”
Justices Kennedy, Ruth Bader Ginsburg, Stephen G. Breyer and Sonia Sotomayor joined the majority decision in the case, US Airways v. McCutchen, No. 11-1285. In dissent, Justice Antonin Scalia, joined by Chief Justice John G. Roberts Jr. and Justices Clarence Thomas and Samuel A. Alito Jr., said the majority had gone astray in interpreting what it said was ambiguous language after having agreed to hear the case on the premise that the language was unambiguous.
Justice Kagan’s majority opinion rejected the reasoning of the court below, the United States Court of Appeals for the Third Circuit, in Philadelphia.
The day’s second decision also concerned a ruling from the Third Circuit. “I don’t have good news for them, either,” Justice Thomas said, to laughter, in announcing his majority opinion.
That case, Genesis Healthcare Corp. v. Symczyk, No. 11-1059, concerned a nursing home in Philadelphia that had docked its workers’ pay by a half-hour for meal breaks, whether they took the breaks or not. Laura Symczyk sued the home, saying it had violated the Fair Labor Standards Act of 1938. The law allows workers to band together in a “collective action,” and Ms. Symczyk said she wanted to represent such a group.
The company promptly offered to settle her case for $7,500, but she did not respond. Though she received no money, a federal judge threw out her case as moot based on the settlement offer. The Third Circuit agreed that Ms. Symczyk’s claim was moot but allowed the collective action to move forward.
Justice Thomas, writing for the majority, leapfrogged over the first question in the case, that of whether the settlement offer had made Ms. Symczyk’s own claim moot. He said she had waived the argument by failing to file a petition contesting that part of the Third Circuit’s decision and in statements made during the lawsuit. Justice Thomas said the court therefore assumed, without deciding, that her individual claim was moot.
On that assumption, Justice Thomas wrote, Ms. Symczyk did not have a stake in the controversy sufficient to allow her to represent the group.
In dissent, Justice Kagan wrote that she was confident that “the majority’s decision — founded as it is on an unfounded assumption — would have no real-world meaning or application.”
“The majority’s decision is fit for nothing,” she wrote. “Aside from getting this case wrong, it serves only to address a make-believe problem.”
She did give an answer to the question the majority had declined to answer. “A friendly suggestion to the Third Circuit: Rethink your mootness-by-unaccepted-offer theory,” she wrote. “And a note to all other courts of appeals: Don’t try this at home.”