Any time a court must interpret an ambiguous statute or contract, it is likely to say it is using grammar to analyze the text. Two 2026 published Circuit Court of Appeals opinions demonstrate the process.
A Verb Becomes an Adjective, and a Preposition Is at Issue
The past participle of a verb can fool you. It looks the same as the past tense, but it’s a different thing. Most past tenses are formed by adding “-ed,” though there are loads of exceptions. As a past tense verb, the word, like the farmer in the dell, stands alone. But once the same word is used as a past participle, it has other functions.
The question in EB5 Holdings Inc v. Edlow was whether a Regional Center was required to pay into an anti-fraud fund. The effect of a past participle was the deciding factor. The answer depended on the word “designated.”
Congress established the EB-5 program in 1990 as a route for noncitizens to earn a visa by investing in job-creating programs. Two years later this was formalized by designating (there’s that word) these economic units as Regional Centers. Unfortunately, the Regional Centers program was plagued by fraud. To combat this problem, in 2022, Congress reauthorized the program and imposed annual fees on Regional Centers to pay for oversight. Regional Centers subject to the fee were “each regional center designated under” the new statute. EB5 Holdings argued that because it had been designated under the prior statute, it was not subject to the fees.
Citing SCOTUS precedent, the court said it was applying a straightforward rule of grammar:
“In ordinary English grammar, we ‘routinely’ use the past participle in this sense—that is, as an adjective ‘to describe the present state of a thing’. By using the past participle ‘designated’, the entity’s current status as a designated Regional Center controls, not on the timing of that designation [quotations as in the original].”
A past participle started life as a verb, but morphed into one of three other things. Here, it became an adjective. Other uses are as a passive: The Regional Center had been designated. With an auxiliary verb, that word is now in the past perfect tense instead of the past tense: The Secretary had designated the Center.
All this linguistic stuff comes naturally to a native speaker — until they have to fight about it.
The court also spent a lot of time parsing the prepositional phrase starting with “under.” EB-5 argued that because it had been a Regional Center before the new statute, it had not been appointed under it. The court disagreed.
Practitioners should pay attention to EB-5’s prepositional phrase argument. EB-5 argued that if Congress meant to include Regional Centers already in existence, it would have said “any Regional Center.” While that was only one of plaintiff’s theories, they are correct that better drafting would have removed that argument.
Not the First Time for the Last Antecedent Rule
You would think an obscure grammar rule would not keep popping up, yet here we are. Get To The Point explained the last antecedent rule in connection with the SCOTUS opinion in Barnhart v. Thomas. In Englehardt v. Blanche, the D.C. Circuit applied it in another case about depositing money into a congressionally mandated fund.
The Department of Justice was required to pay certain criminal penalties and forfeitures into the United States Victims of State Sponsored Terrorism Fund. The Department deposited a small fraction of the sums collected. Two victims of terrorist attacks with claims against the fund sued.
Here is the language that defines the fund’s money sources, edited for grammatical analysis:
All funds, and the net proceeds from the sale of property, forfeited or paid to the United States after December 18, 2015,
- as a criminal penalty or fine arising from a violation of any license, order, regulation, or prohibition issued under the International Emergency Economic Powers Act [(“IEEPA”)] or the Trading with the Enemy Act [(“TWEA”)],
- or any related criminal conspiracy, scheme, or other Federal offense arising from the actions of, or doing business with or acting on behalf of, a state sponsor of terrorism.
The disputed funds were part of a scheme involving BAT, British American Tobacco, which engaged in certain illegal transactions to support its business in North Korea. The conspiracy commenced in 2009. North Korea was no longer deemed a state sponsor of terrorism as of 2008. Most of the $653,000,000 BAT paid in criminal penalties and forfeitures resulted from its IEEPA violations and bank fraud conspiracy. The Department maintained that only the amount attributable to the last part of the statute was subject to contribution to the fund.
The court confirmed that there are two categories of offenses and paid special attention to the word “related,” concluding:
“the state sponsor of terrorism qualifier applies only to the immediately antecedent ‘separate class’ of offenses, namely ‘any related criminal conspiracy, scheme, or other Federal offense.’ Congress separated the categories with a disjunctive ‘or’ and set off the second category with the prepositive modifier ‘related.’ This grammatical structure supports our interpretation that the Funding Provision sets out two distinct categories of offenses and that the state sponsor of terrorism qualifier applies only to the second.”
This opinion does not cite Antonin Scalia or Bryan Garner and their explanations of the last antecedent rule, but it is certainly applying it. Because the reference to a connection with a state sponsor of terrorism comes at the end of the list, it only applied to proceeds collected under that section. The larger portion assessed under IEEPA should have been contributed to the victims’ fund as well.
The last antecedent rule is subject to plenty of criticism. Placement of the conjunction “or” might or might not be dispositive. Looking at the body of published cases that have applied or eschewed the canon, one rule stands out. The court interprets the modifier of a last antecedent however it chooses to reach the result it thinks is right.
The Lesson: Broaden Your Research
Nobody ever said federal statutes make for easy reading. Because of our legislative process and the huge number of statutes, the texts are dizzyingly complex. That’s why lawyers fight about their meaning.
There’s a reason the vast majority of cases settle. While grammar as well as precedent are the supposed rules by which ambiguous language must be interpreted, in practice, the result is unpredictable.
In the earliest stages of a dispute where grammar is at issue, broaden your research. Be ready to quote treatises and cite cases from any jurisdiction. Because the results are so varied, you are likely to find authority to support your position. When every party is ready to back up their theories with good research, it’s time to consider compromise.
More Court Cases That Relied on Grammar
This Is Happening More Often Than You Realize: More Court Opinions That Rely on Grammar
Grammar Changes the Case Outcome — Again
Three SCOTUS Cases Where Grammar Made a Difference
Whereas, I Keep Telling Lawyers to Stop Writing Like This
It Is What It Is: Can You Plead That In Court?
More Writing Tips
Find more good ideas for improving your legal writing and communications skills in “Get to the Point” by Teddy Snyder.
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