Illegal Workers: Court Upholds Faulting Hirers

The 5-to-3 decision appeared to endorse vigorous state efforts to punish employers who intentionally hire illegal workers. The majority opinion, written by Chief Justice John G. Roberts on behalf of the court’s five more conservative members, said that Colorado, Mississippi, Missouri, Pennsylvania, South Carolina, Tennessee, Virginia and West Virginia had recently enacted laws similar to the one at issue in the case.

The decision did not directly address a more recent Arizona law that gives the police greater authority to check the immigration status of people they stop.

The United States Court of Appeals for the Ninth Circuit blocked enforcement of that law in April, and the case may reach the Supreme Court soon.

The challenge to the Arizona law that was the subject of Thursday’s decision was brought by a coalition of business and civil liberties groups, with support from the Obama administration.

They said the law in question, the Legal Arizona Workers Act, conflicted with federal immigration policy.

The act was signed into law in 2007 by Janet Napolitano, a Democrat who was then the state’s governor. Ms. Napolitano is now secretary of the Department of Homeland Security.

The decision on Thursday turned mostly on the meaning of a provision of a 1986 federal law, the Immigration Reform and Control Act, which said that it overrode “any state or local law imposing civil or criminal sanctions (other than through licensing and similar laws) upon those who” recruit or hire “unauthorized aliens.”

The question was whether Arizona was entitled to supplement the penalties in the 1986 federal law with much tougher ones of its own. The state argued that the phrase in parentheses — “other than through licensing and similar laws” — allowed it to suspend or revoke the business licenses of repeat offenders. Critics called that provision of the state law a “business death penalty.”

Chief Justice Roberts wrote that the word “licensing” should be read broadly to allow states to supplement federal efforts to prevent the hiring of illegal workers. His decision was joined by Justices Antonin Scalia, Anthony M. Kennedy, Samuel A. Alito Jr. and, for the most part, Clarence Thomas.

Peter J. Spiro, who teaches immigration law at Temple University, said the majority’s broad reading would be consequential. “In some ways, this becomes an exception through which states can drive a truck,” he said. “It’s definitely going to embolden anti-immigration constituencies to work through state capitals.”

There is reason to think that those constituencies will meet with some success, judging from the fact that 13 states filed a brief supporting Arizona.

But Robin S. Conrad, a lawyer with the U.S. Chamber of Commerce’s litigation unit, said in a statement that “the decision does not give states or local governments a blank check to pass any and every immigration law” and that only state laws consistent with the federal one were permissible. The Chamber of Commerce was a plaintiff in the suit.

Ms. Conrad added that “businesses from Main Street to Wall Street are overwhelmed by a cacophony of conflicting state and local immigration legislation” and that Congress should bring order to the area.

Cecillia D. Wang, a lawyer with the American Civil Liberties Union’s Immigrants’ Rights Project, also urged a cautious reading of the decision, saying that it was narrowly tied to the Arizona law. The A.C.L.U. was part of the odd-bedfellows coalition that had challenged the law.

Jay Sekulow, a lawyer with the American Center for Law and Justice, a conservative public interest law firm that filed a brief urging the court to uphold the law, said the ruling was “a victory for Arizona and other states” that “provides a realistic roadmap” for enacting legislation that does not run afoul of the federal law.

Justice Stephen G. Breyer, in a dissent joined by Justice Ruth Bader Ginsburg, said the word “licensing” in the federal law should be read narrowly to mean “employment-related licensing systems” and not all licenses. “Why not an auto licensing law?” he asked of the majority’s interpretation. “Why not a dog licensing law?”

Chief Justice Roberts responded that Congress could easily have limited the phrase had it wanted to. “If we are asking questions,” he added, “a more telling one may be why, if Congress had intended such limited exceptions to its prohibition on state sanctions, it did not simply say so, instead of excepting ‘licensing and similar laws’ generally?”

Chief Justice Roberts wrote that the Arizona law was a measured response to real problems and that “licensing sanctions are imposed only when an employer’s conduct fully justifies them.”

He added that there was no reason to fear that the state law would lead to discrimination against Hispanics who were in the United States lawfully.

“The most rational path for employers,” the chief justice wrote, “is to obey the law — both the law barring the employment of unauthorized aliens and the law prohibiting discrimination — and there is no reason to suppose that Arizona employers will choose not to do so.”

But Justice Breyer said the state law disrupted a carefully calculated balance between competing Congressional goals and that it “seriously threatens the federal act’s antidiscrimination objectives.” The state law increased penalties for hiring illegal workers, he said, but it left “the other side of the punishment balance — the antidiscrimination side — unchanged.”

The decision, Chamber of Commerce v. Whiting, No. 09-115, also upheld a second aspect of the Arizona law, this one making mandatory an otherwise voluntary federal program, E-Verify, that allows employers to validate whether potential employees are authorized to work.

In his dissent, Justice Breyer said it was a mistake to require use of a “pilot program” that was “prone to error.”

Justice Sonia Sotomayor wrote a separate dissent. Justice Elena Kagan recused herself from the case because she had worked on it as United States solicitor general.

“I cannot believe,” she wrote, “that Congress intended for the 50 states and countless localities to implement their own distinct enforcement and adjudication procedures for deciding whether employers have employed unauthorized aliens.”

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A Hedge Fund Manager’s Latest Bet: The Mets

But Mr. Einhorn — one of a handful of hedge fund managers followed by investors looking for the next smart play — insists that he spends far more time trolling through the bargain bin, looking for companies with potential that others have dismissed, then betting on their long-term revival.

On Thursday, in announcing that he has entered into exclusive negotiations to spend $200 million for a noncontrolling stake in the Mets, Mr. Einhorn, 42, may be making one of his most intriguing long-term bets yet.

The Mets, as their principal owner said in comments published this week, are lousy, snakebitten and bleeding cash, having lost $50 million last year alone. Attendance has plummeted at Citi Field. Perhaps most daunting, the trustee for the victims of Bernard L. Madoff’s Ponzi scheme has sued the team’s owners for $1 billion.

Mr. Einhorn did his best Thursday to sound like a friendly investor in a team very much in need of friends. He spoke fondly of dressing on Halloween as Dave Kingman, the face of the Mets during lean years three decades ago. He coaches his daughter’s Little League team. He said that he had, while growing up in Milwaukee, hit home runs into the backyard of the baseball commissioner, Bud Selig.

Mr. Einhorn emphasized that his investment in the Mets was not related to any of the $8 billion or so he manages at Greenlight Capital, his hedge fund. He sent an e-mail to investors to clarify the distinction and acknowledged that he understood that rehabilitating a troubled franchise would not be swift or easy.

“Baseball is a tough sport, and everyone wants to win more games,” said Mr. Einhorn, who would become one of a handful of financial moguls to own a professional sports team. “Over time, there is going to be losing seasons and tough seasons and winning seasons and hopefully championship seasons. I hope to experience all of those.”

Forbes magazine values the Mets at $747 million, 13 percent less than last year. The true value of the team, though, will not be known until it is clear what percentage of the club Einhorn will get for his $200 million.

Mr. Einhorn’s proposed stake in the Mets — which must be completed with the team and approved by Major League Baseball — fits a pattern. He enjoys making money, and seems to enjoy almost as much crowing about how right his often blunt, often controversial investment analysis typically proves to be.

Indeed, he wrote a book detailing his prescience and some of the ills of the financial industry. It was titled, “Fooling Some of the People All of the Time.”

Mr. Einhorn does not seem to have the makeup of a hard-charging hedge fund manager. Mild-mannered, he speaks deliberately and softly. He was born in Demarest, N.J., and his family moved to Milwaukee when he was 7. He graduated from Cornell with a degree in government, not economics or business.

While many fund managers work well into the night, Mr. Einhorn is known to leave the office early enough to get home for his daughter’s Little League games. He is active in several charities and, with his wife, Cheryl, set up a trust whose mission is to help people get along better.

But Mr. Einhorn also grew up in a financially minded home. His father is a banker who helps facilitate mergers and acquisitions. Mr. Einhorn helped found his hedge fund in 1996, when he was in his late 20s — a young age by industry standards — with less than a million dollars, much of which came from his parents.

He is a believer in so-called value investing, a strategy made famous by the likes of Warren E. Buffett (he once paid $250,000 to have lunch with the legendary investor), which holds that the best investments are made in good companies that are cheap. He will spend months reviewing a company’s financial information, searching for hidden value. He can then bet big, sometimes on the order of hundreds of millions.

Mr. Einhorn is fond of quoting Ken Griffey Jr. when talking about his investment style: “I don’t consider myself a home run hitter. But when I’m seeing the ball and hitting it hard, it will go out of the park.”

Peter Lattman contributed reporting.

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Tests Reveal Mislabeling of Fish

Yellowtail stands in for mahi-mahi. Nile perch is labeled as shark, and tilapia may be the Meryl Streep of seafood, capable of playing almost any role.

Recent studies by researchers in North America and Europe harnessing the new techniques have consistently found that 20 to 25 percent of the seafood products they check are fraudulently identified, fish geneticists say.

Labeling regulation means little if the “grouper” is really catfish or if gulf shrimp were spawned on a farm in Thailand.

Environmentalists, scientists and foodies are complaining that regulators are lax in policing seafood, and have been slow to adopt the latest scientific tools even though they are now readily available and easy to use.

“Customers buying fish have a right to know what the heck it is and where it’s from, but agencies like the F.D.A. are not taking this as seriously as they should,” said Michael Hirshfield, chief scientist of the nonprofit group Oceana, referring to the Food and Drug Administration.

On Wednesday, Oceana released a new report titled “Bait and Switch: How Seafood Fraud Hurts Our Oceans, Our Wallets and Our Health.” With rates of fraud in some species found to run as high as 70 percent, the report concluded, the United States needs to “increase the frequency and scope” of its inspections.

DNA bar coding, as it is called, looks at gene sequences in the fish’s flesh. “The genetics have been revolutionary,” said Stefano Mariani, a marine researcher at University College Dublin, who has published research on the topic. “The DNA bar coding technique is now routine, like processing blood or urine. And we should be doing frequent, random spot checks on seafood like we do on athletes.”

Policing the seafood industry has historically been challenging because even the most experienced fishmongers are hard pressed to distinguish certain steaks or fillets without the benefit of scales or fins. And many arrive in supermarkets frozen and topped with an obscuring sauce.

Older laboratory techniques to identify fish meat looked at the mix of proteins in flesh samples, but were unreliable, expensive and cumbersome. Investigators often relied instead on laborious legwork, tracking inconsistent fish names on paperwork as seafood moved across international borders. Eighty-four percent of seafood consumed in the United States is now imported, often passing through a multistep global supply chain.

With the new genetic techniques, the gene sequence found in a fish sample is compared with an electronic reference library like that maintained by the International Barcode of Life Project, which now covers 8,000 varieties of fish compiled by biologists over the last five years. The testing is now relatively cheap: commercial labs charge about $2,000 for analyzing 100 fish samples, for an average of $20 apiece, but the cost is under $1 per sample for labs that own the equipment.

Douglas Karas, a spokesman for the F.D.A., said in an e-mail that the agency had been working with scientists to “validate” DNA testing for several years. It recently purchased gene sequencing equipment for five F.D.A. field laboratories and hoped to use it “on a routine basis” by the end of this year.

This new type of scrutiny could allow hundreds of thousands of samples to be tested each year, rather than the hundreds that are now rigorously analyzed, said Dr. Paul Hebert, scientific director of the Barcode of Life project, based in Guelph, Ontario. In March, the F.D.A. issued an alert to inspectors about mislabeled fish. It had already used bar coding as irrefutable evidence to prosecute sellers or issue warnings involving seafood “misbranding,” Mr. Karas said, much as prosecutors use DNA evidence in sex crime cases.

But it will take time to clamp down on a lucrative and, apparently, widespread practice. Dale Sims, chief fishmonger for Cleanfish, a San Francisco-based supplier of high-end sustainable seafood, said he’d seen thresher shark labeled as shark, swordfish and mahi-mahi all in the same market, as well as many other obvious substitutions.

“It infuriates me but it’s hard to correct,” he said. “I’m embarrassed to say that there’s been a lot of fragmentation in this industry. So if someone is unscrupulous, it’s been easy to get away with it.”

For consumers, the issue is about dollars and cents — wanting to get the quality and type of fish they paid for. “If you’re ordering steak, you would never be served horse meat,” said Dr. Hirshfield of Oceana. “But you can easily be ordering snapper and get tilapia or Vietnamese catfish.”

Environmentalists worry that duped diners may be unwittingly contributing to declining fish stocks, buying food they have been told to avoid. Dr. Hebert said that in testing samples from the United States and Canada, his lab had even detected meat from endangered sharks being sold to diners. “If it were labeled endangered species,” he said, “you couldn’t sell it and you wouldn’t buy it, right?”

Most of the research has been done not by regulators but by individual fish biologists and geneticists; to date no definitive national study has been carried out on the scope of the fraud.

Dana Miller, a doctoral student who worked with Dr. Mariani in Dublin studying the mislabeling of cod, the most popular fish in Ireland, said, “we expected with all the policies and legislation and inspections, the numbers would be pretty low.” But 25 percent of samples of fresh cod and haddock and over 80 percent of the smoked products, were in fact something else. Irish cod stocks are overfished.

“If you can’t even trust that the name is right, then how can you trust anything else on the package, including the date?” she said. In Europe, seafood labels include the fishery where it was caught. In the United States, it must list only a “country of origin” although that is often the processing country rather than where it is caught.

The group Cleanfish is experimenting with an electronic tagging system through which each fisherman or processor would enter his code onto a tag on each fish, making its journey from the sea to the plate fully transparent. Cleanfish buys only whole fish since its outward appearance helps to verify its identity.

And bar coding is becoming more accessible every year. Today, fish samples are sent to labs for testing, but scientists predict that there will be desktop DNA bar coding systems within five years and, in 10, inspectors will carry hand-held detectors.

“Everyone should be using this technique — there should be spot checks and fines,” said Dr. Hebert of the DNA bar coding project. “If there were no speed traps and radar checks, there would be a lot more speeding.”

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