Key Decisions

U.S. v. Winstar Corp., 518 U.S. 839 (1996)
In a decision handed down on July 1, 1996, the Supreme Court ruled that the federal government was liable for breaching, by Congress's enactment of stricter savings & loan regulations, its contracts with three plaintiff savings & loans banks. A four justice plurality of the Court held that three of the four special sovereign defenses to breach of contract - the unmistakability doctrine, the reserved powers doctrine, and the express delegation doctrine - did not apply to the case because damages would not stop the government from exercising its sovereign power in enacting new regulations. The plurality held that the government failed the fourth sovereign defense - the sovereign acts doctrine - because the enactment was not public and general. Justice Scalia, writing for himself, Justice Thomas and Justice Kennedy, concurred in the judgment but disagreed with the plurality's analysis of the sovereign defenses. Then Chief Justice Rehnquist, with Justice Ginsburg joining, dissented on the grounds that both the unmistakability doctrine and the sovereign acts doctrine applied and that each excused the federal government from liability in the case.


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