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FEDERAL PREEMPTION (PART II)

June 21, 2017

FEDERAL PREEMPTION (PART II)

In Cipollone v. Liggett Group, Inc., the Supreme Court in 1992 held that a statute specifying warnings for cigarette packages preempted the claim of Rose Cipollone, a 57-year-old woman from Little Ferry, New Jersey, who said the packages of the cigarettes that she smoked did not adequately warn her of the hazards of smoking. The fact that Congress had decided AFTER she had originally filed her case that the package warning was wholly inadequate did not resurrect her claim for damages. Huh? The court can apply regulations setting a standard for liability that were not in existence at the time a plaintiff filed his or her claim? The answer is yes; such state standards can be preempted, even retrospectively per Cipollone.

I think Cipollone was wrongly decided and worse, it opened the floodgates for the tobacco and other lobbyists for dangerous products (including caustic chemicals) to go to the federal agencies and see to it that they come up with weak regulations. Why go state-to-state lobbying when you can lobby the federal agencies whose final regulations will preempt all state laws and regulations adverse to the interests of manufacturers of such dangerous products? Just go to Washington, lobby for weak to no standards of liability, apply such standards in suits by injured plaintiffs and have the trial court dismiss such claims as a result of the federal preemption of state laws and regulations.

In sum, as Professor of law (at the University of Texas) McGarity points out, federal preemption can both obliterate state statutes and regulations that are inconsistent with federal law and rob injured citizens of their right to seek redress from irresponsible corporations that comply with weak federal regulations.

Worse still, and in an area not addressed by McGarity, I understand that there is a bill now either pending or to be soon filed by the Trump administration to have all proposed final regulations by all federal agencies reviewed by the Congress before such regulations can have final effect. This politicizes every such final proposed final regulation, ignores the expertise of those in the particular agency who have worked to bring such a regulation to final status, gives lobbyists another shot at overcoming or weakening the final regulation in question, and amounts to an abdication of executive responsibility to the legislative branch (who have already done their legislative duty by passing legislation which the regulation in question is designed to flesh out).

Regulated companies and the Chamber of Commerce argue that preemption is necessary to provide smoothly functioning national markets. Environmental groups, consumer activists and plaintiffs respond that federal agencies are subject to capture by regulated interests. The new proposal I have alluded to in the previous paragraph will, of course, be used by special and regulated interests to opportunistically seek desirable outcomes by influencing federal agencies to preempt state laws and regulations deemed adverse to their interests, provide another shot at fashioning such final regulations via a political process of congressional review, and can and will ignore the broad principles of federalism in the process. It is noteworthy that conservative politicians are vocal proponents of states’ rights when it comes to tough voting laws that suppress voting but are all for preemption of states’ rights where, for instance, consumer protection laws and regulations are involved. To be fair in my assessment, however, I note that there is a long judicially established “presumption against preemption” applicable to such traditionally state-regulated matters as local building codes, setting local utility rates etc.

However, even here and under its power to regulate interstate commerce, Congress can decide that the regulatory regime that it imposes by law also contains a provision that sets out the extent to which the statute exempts state law. The Atomic Energy Act of 1954 and the Medical Device Amendments Act of 1976 are good examples where the Congress has rightly set forth in such acts a provision that preempts all state laws and regulations. Congress has, in my opinion, properly decided that such dangerous technologies as atomic power and medical devices are to be regulated by highly expert federal agencies free of state interference.

Finally, and I think this is a safe prediction, we can confidently expect the Trump administration to urge courts to dismiss claims of victims of irresponsible companies whose products and activities comply with weak federal regulations, and Cipollone tells us that such a plan can even be accomplished retrospectively! Expect lobbyists (with checkbooks open for “campaign contributions”) to be on duty every single day in influencing congressional committees to adopt language in proposed legislation that preempts state laws and regulations while also laboring to amend the language of existing laws and regulations for their corporate clients with a view to bring on the weakest possible standards of liability for such clients to employ in the courtroom.

What to do? Elect those to the Congress who believe that corporations should be held to the same standards of liability that you and I have. If I pour chemicals on my neighbor’s yard, I am rightly liable for damages. The tort, unless intentional, is called negligence. Why should some corporation be allowed to commit a similar tort if the use of their product produces similar results? Should their politically-set standards for liability be any different than mine? Count me as a nay vote.     GERALD      E

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