This Day in Legal History: Gulf of Tonkin Resolution
On August 7, 1964, the U.S. Congress passed the Gulf of Tonkin Resolution, dramatically reshaping the legal landscape of American military engagement. Prompted by reports—later disputed—of North Vietnamese attacks on the USS Maddox in the Gulf of Tonkin, the resolution granted President Lyndon B. Johnson broad authority to use military force in Southeast Asia without a formal declaration of war. It passed nearly unanimously, with only two dissenting votes in the Senate, reflecting the tense Cold War atmosphere and congressional trust in the executive branch.
Legally, the resolution functioned as an open-ended authorization for the president to escalate military operations in Vietnam. Within months, it led to the deployment of hundreds of thousands of U.S. troops. Critics would later argue that it allowed the executive to bypass Congress’s constitutional war-making powers, effectively green-lighting a years-long conflict based on contested facts.
As the war dragged on and public opinion turned, the resolution became a focal point for debates over separation of powers, congressional oversight, and executive overreach. In 1971, amid growing backlash, Congress repealed the resolution, but its legacy endured. It served as a legal and historical precedent for future authorizations of force, including those passed after 9/11.
A federal appeals court has upheld the SEC’s long-standing “gag rule,” which prevents defendants who settle civil enforcement cases from publicly denying the agency's allegations. The 9th Circuit Court of Appeals ruled 3-0 that the rule is not unconstitutional on its face but left room for future challenges depending on how it’s applied. The policy, in place since 1972, requires settling parties to at least refrain from admitting or denying wrongdoing. The court emphasized that defendants remain free to reject settlements if they wish to speak out.
Twelve petitioners, including former Xerox CFO Barry Romeril and the New Civil Liberties Alliance (NCLA), challenged the SEC’s January 2024 decision not to revise the rule. Romeril had previously brought a similar challenge to the Supreme Court with support from Elon Musk, but the Court declined to hear it. Writing for the panel, Judge Daniel Bress noted that removing the gag could reduce the SEC’s ability to settle cases efficiently and that speech restrictions are voluntary components of settlement agreements.
The NCLA criticized the decision, arguing it effectively sanctions government-imposed silence and announced plans to pursue further appeals. SEC Commissioner Hester Peirce also dissented from the agency’s refusal to revisit the rule, arguing that it hinders public accountability by suppressing potential criticism. The SEC declined to comment on the ruling, which came in the case Powell et al v. SEC.
US appeals court upholds SEC 'gag rule' over free speech objections | Reuters
The Stanford Daily, Stanford University’s student newspaper, has filed a lawsuit against the Trump administration, accusing it of violating the free speech rights of foreign students. The suit, filed in federal court in California, alleges that threats of arrest, detention, or deportation have created a climate of fear among international students, discouraging them from writing about sensitive political issues—particularly the Israeli-Palestinian conflict. Two unnamed students joined the paper in the lawsuit, which names Secretary of State Marco Rubio and Secretary of Homeland Security Kristi Noem as defendants.
According to the plaintiffs, the administration has labeled pro-Palestinian viewpoints as antisemitic or extremist and attempted to deport students expressing such views, framing them as threats to U.S. foreign policy. In some instances, students have been detained without charges, though judges have later ordered their release. The lawsuit contends that these actions have led to widespread self-censorship among international students, chilling constitutionally protected speech in areas such as protests, slogans, and commentary on U.S. and Israeli policy.
The Stanford Daily is seeking a court ruling affirming that the First Amendment protects non-citizens from government retaliation based on their speech. The university clarified it is not involved in the suit, as the newspaper operates independently. Attorney Conor Fitzpatrick, representing the paper, called the government's actions antithetical to American values of free expression.
Stanford student newspaper sues Trump administration for alleged free speech violations | Reuters
A U.S. appeals court has reinstated a lawsuit accusing major drugmakers Sanofi, Eli Lilly, Novo Nordisk, and AstraZeneca of conspiring to limit drug discounts provided under the federal 340B program. The 2nd Circuit Court of Appeals reversed a lower court’s dismissal, allowing two health clinics—Mosaic Health and Central Virginia Health Services—to proceed with their proposed class action. These clinics claim the companies colluded in 2020 to restrict discounts on diabetes medications, harming safety-net providers and the low-income patients they serve.
The court found that because the four companies control much of the diabetes drug market, coordination to limit discounts could be feasible. Judge Myrna Pérez, writing for the panel, noted the allegations were plausible enough to move forward. The drugmakers have denied wrongdoing and argue their policies were developed independently to address alleged fraud in the 340B program. Sanofi and Novo Nordisk said they are reviewing the decision, while Lilly criticized the ruling and defended its practices as legal.
The clinics say the drugmakers earned billions in extra profits through these policies, which allegedly undercut essential savings for providers. The case underscores the broader tension between pharmaceutical companies and healthcare providers over the administration of the 340B program, which requires drugmakers to offer discounts in exchange for access to federal healthcare funds.
PepsiCo is facing a proposed class action lawsuit alleging it engaged in illegal price discrimination by giving more favorable pricing and discount terms to large retailers like Walmart while denying the same deals to smaller businesses. Filed in federal court in Manhattan by an Italian restaurant operator, the lawsuit claims this practice violates the Robinson-Patman Act, a rarely enforced 1936 antitrust law meant to prevent discriminatory pricing that harms competition.
The suit accuses Pepsi of providing payments and allowances to Walmart that were not extended to other retailers, placing smaller businesses at a competitive disadvantage. Although Walmart is named in the allegations, it is not a defendant in the case. The plaintiff argues that Pepsi’s pricing tactics unfairly burden other merchants who must pay more for the same products.
This legal action echoes a previous Federal Trade Commission (FTC) lawsuit filed against Pepsi in January under the Biden administration. However, the second Trump administration dropped the case in May, with Trump-appointed FTC Chair Andrew Ferguson criticizing it as a politically motivated effort launched too late in the prior administration’s term. The FTC has not commented on the new private lawsuit.
The class action seeks unspecified damages on behalf of thousands of Pepsi purchasers nationwide. Neither Pepsi nor Walmart has publicly responded to the allegations.
Pepsi accused of price discrimination in new merchant class action | Reuters
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