Minimum Competence - Daily Legal News Podcast
Minimum Competence
Legal News for Fri 1/26 - Biden Pauses LNG Exports, Zero-Carbon Hydrogen Tax Rules, MA Supreme Court Tenure Falling, Trump Defamation Trial Ends and Musk Neuralink Woes

Legal News for Fri 1/26 - Biden Pauses LNG Exports, Zero-Carbon Hydrogen Tax Rules, MA Supreme Court Tenure Falling, Trump Defamation Trial Ends and Musk Neuralink Woes

Biden admin pausing LNG exports, divisive zero-carbon hydrogen tax rules, the plummeting tenure at Massachusetts court, the wrap-up of Trump's defamation trial, and Musk's Neuralink issues.

A monkey driving a tanker truck of poison, pencil sketch.

This Day in Legal History: Michigan Joins the Union

On this day, January 26, in 1837, a pivotal moment in United States history unfolded as Michigan was admitted to the Union as the 26th state. This event marked not only a geographic expansion but also a significant legal and political milestone in the nation's history.

The journey to statehood was fraught with legal challenges and territorial disputes, notably the Toledo War, a boundary dispute with Ohio. This conflict was rooted in conflicting state and federal legislation and conflicting surveys of the Ohio-Michigan border. The resolution of this dispute was critical to Michigan's path to statehood.

The Toledo War sounds like a weird bit of history, so let’s take a detour and talk about that for a minute. It was a boundary dispute between the U.S. states of Ohio and the then Michigan Territory, and erupted in 1835 and lasted into 1836. At the heart of the conflict was the city of Toledo, strategically positioned at the western end of Lake Erie, and both jurisdictions claimed it due to conflicting state and federal legislation and surveys. The dispute was characterized more by political maneuvering and posturing than actual combat, with only a few minor skirmishes and no casualties. The resolution came with the passage of the Michigan Enabling Act of 1836, where Michigan agreed to cede its claim to the Toledo Strip in exchange for statehood and the western Upper Peninsula. This resolution highlighted the complex interplay of federal and state politics in early America, and the Toledo War stands as a unique and somewhat peculiar incident in U.S. legal and territorial history.

The legal implications of Michigan's admission were profound. The state's constitution, drafted in 1835, was a progressive document for its time. It established a public education system and prohibited imprisonment for debt, reflecting a forward-thinking approach to governance and civil liberties.

Michigan's statehood also had a significant impact on federal politics. The balance between free and slave states in the U.S. Senate was a contentious issue, and Michigan's admission as a free state was part of a larger political and legal narrative leading up to the American Civil War.

In addition, Michigan's rich natural resources, particularly its vast timber reserves, played a crucial role in its economic development. This led to legal developments in environmental and resource management laws, setting precedents for other states.

The state's diverse population, including a significant number of Native Americans, also led to legal developments concerning indigenous rights and land treaties. Michigan's history of negotiation and treaties with Native American tribes was an important part of its early legal landscape.

In conclusion, the admission of Michigan into the Union on January 26, 1837, was more than just a change in the political map of the United States. It was a complex legal event that had far-reaching implications in areas such as territorial law, civil rights, natural resource management, and the delicate balance of power regarding the issue of slavery. Today, we remember this day as a key moment in the legal and political history of the United States.

The Biden administration has paused new licenses for U.S. liquefied natural gas (LNG) exports to assess their impacts on climate change, the economy, and national security. This decision, crucial in the ongoing debate about LNG's role in energy's future, has significant implications for several major projects and billions of dollars in investments. The Energy Department's study, building on prior analyses, will scrutinize each new export proposal on a case-by-case basis, considering public interest—a standard set by federal law. The review is conducted by the department's national labs and is expected to take several months, after which a report will be open for public comment.

President Biden emphasized this pause as a recognition of the climate crisis's severity. The decision is seen as a litmus test of his commitment to climate change, especially by environmentalists who view LNG infrastructure as a long-term environmental threat. Politically, this move places Biden in a delicate position, balancing environmental commitments with economic and geopolitical concerns, particularly in light of the upcoming presidential election and global energy dynamics.

The pause could impact over a dozen proposals awaiting review, including ventures in Louisiana by Commonwealth LNG and Energy Transfer LP. Environmental groups like Oil Change International view this as a critical step in combating climate change, while critics, including Republicans and LNG advocates, argue it undermines U.S. energy commitments and geopolitical stability, especially regarding European reliance on Russian gas. The decision reflects the complex interplay between environmental, economic, and political factors in shaping the U.S. energy policy.

Biden Freezes Approvals to Export Gas, Imperiling Major Projects

The U.S. Treasury Department's proposed rules for a new clean hydrogen production tax credit, introduced in December, have sparked debate within the industry. These rules require hydrogen producers to source electricity from new power sources and, by 2028, to align their production with clean power generation hourly. This approach, focusing on three pillars of power sourcing, has been criticized for being overly restrictive and excluding nuclear and hydropower, while favoring intermittent wind and solar energy.

Industry experts argue that the guidance may stifle innovation and limit the expansion of the hydrogen market, as seen in the case of companies like Cummins Inc., which is hesitant to invest further without more flexible tax credit regulations. The 45V hydrogen production tax credit, established by the Inflation Reduction Act of 2022, offers up to $3 per kilogram for hydrogen meeting certain emissions standards, aiming to replace fossil fuels in various industries.

However, the Treasury Department decided that using electricity from a grid powered by fossil fuels would contradict the climate law’s emissions reduction standards. Some industry consultants suggest that allowing a certain capacity of hydrogen projects to operate beyond 2028 without adhering to these strict rules would be more economically viable. The debate also touches on the potential shift of investments towards hydrogen projects that use natural gas with carbon capture, influenced by the enhanced 45Q carbon capture tax credit.

The Treasury is considering some flexibility, like counting a portion of existing clean power towards compliance or reclassifying struggling nuclear or hydroelectric facilities as new power sources. Still, these proposals have met with mixed reactions, with some arguing it could undermine the purpose of the three-pillar approach. The industry continues to lobby for more alignment with other Biden administration policies, like the bipartisan infrastructure law and the Defense Production Act, which support hydrogen initiatives. Public comments on the proposed rule are due by February 26.

If any of this is interesting to you, I wrote a column in August of last year predicting this problem. In it, I emphasize the interdependence of clean hydrogen and clean electricity and suggest focusing tax policy on streamlining and funding the clean electricity sector, which is crucial for clean hydrogen production. Ultimately, the need for regulatory alignment and clarity, as seen in the EU's approach to the hydrogen market, is highlighted to foster both the renewable hydrogen industry and the broader clean energy sector.

Zero-Carbon Hydrogen Tax Rules Spark Divide Over Grid Emissions

Funding Clean Electricity Will Help Grow the Hydrogen Economy

Justices on Massachusetts' Supreme Judicial Court are serving shorter terms than in the past, averaging just six years since 2010, the lowest in decades. This trend, emerging since the state implemented a mandatory judicial retirement age of 70 in 1972, is causing unpredictability in court rulings and making it difficult for attorneys to gauge the court's leanings. Factors contributing to this decline include less linear legal career paths, heavy workloads, longer life expectancies, and salaries not keeping pace with the private sector.

The frequent turnover affects how law is interpreted and challenges lawyers to constantly adapt to the court's changing dynamics. Attorneys need to familiarize themselves with each new justice's preferences and philosophies, impacting how cases are argued and potentially leading to more decisions that overturn past rulings. However, former Chief Justice Margaret Marshall notes that similar periods of turnover in the past did not significantly disrupt the court's jurisprudence.

Recent departures of two justices for outside opportunities before reaching the mandatory retirement age suggest a shift in how legal careers are viewed. Decades ago, a position on the Supreme Judicial Court was seen as a career pinnacle, but longer life spans now allow for significant second careers post-judiciary service. This flexibility, combined with the allure of more lucrative private sector opportunities, is influencing justices' decisions to leave the bench earlier.

The SJC's justices earn significantly less than first-year associates at large law firms, contributing to the appeal of private sector opportunities. While each state handles judicial tenure differently, the shorter tenures in Massachusetts raise concerns about the impact on legal stability and the need to investigate factors like pay, workload, and mandatory retirement in retaining justices. Despite these challenges, it remains uncertain if the younger cohort of justices will reverse this trend.

Tenure on Massachusetts’ Highest Court Plummets to All-Time Low

E. Jean Carroll's defamation lawsuit against former U.S. President Donald Trump is nearing its conclusion, with the jury set to decide on damages after Trump's denial of raping Carroll in the 1990s. Carroll is seeking at least $10 million for damages to her reputation caused by Trump's 2019 denial during his presidency. A previous trial in May 2022 already found Trump liable for defamation and sexual abuse, awarding Carroll $5 million. This current trial focuses solely on the extent of damages to Carroll's reputation and the possibility of punitive damages. Trump's defense was limited to standing by his previous deposition, where he labeled Carroll's claims a hoax, as the judge restricted revisiting issues settled in the first trial.

Trump, Carroll to wrap up defamation trial | Reuters

Elon Musk's brain-implant company, Neuralink, was fined by the U.S. Department of Transportation (DOT) for violating hazardous material transport rules. During inspections in February 2023 at Neuralink's facilities in Texas and California, it was discovered that Neuralink had not registered as a transporter of hazardous materials and improperly packaged hazardous waste, including the flammable liquid Xylene, which poses serious health risks. The company was fined $2,480, a reduced amount due to their agreement to rectify the issues. The violations were confirmed by a DOT spokesperson, and the inquiry has now been closed. These details came to light through records obtained by the Physicians Committee for Responsible Medicine (PCRM), which opposes animal testing in medical research. The records, however, did not clarify why Neuralink needed to transport these materials or if any harm resulted from the violations.

Exclusive: Musk brain implant company violated US hazardous material transport rules -documents | Reuters

Minimum Competence - Daily Legal News Podcast
Minimum Competence
The idea is that this podcast can accompany you on your commute home and will render you minimally competent on the major legal news stories of the day. The transcript is available in the form of a newsletter at