The Administration’s concerted effort to thwart effective consumer protection and to remove the incentive to improve safety beyond the minimum standards set by regulatory agencies reminds me of its politicizing of the Justice Department. Just as we have witnessed improper political considerations undermine our federal law enforcement agency for partisan gain, we are now witnessing agency rulemaking turned into a mechanism to immunize powerful corporations at the expense of ordinary Americans. Rather than issuing regulations based on facts and science to benefit the American people, the process has apparently been hijacked. The intended result of this politically-motivated version of rulemaking not only slams the local courthouse door shut on injured victims but it prevents State law, State regulators and State courts from protecting their citizens.
So said Senator Patrick Leahy at a Senate Judiciary Committee Hearing on September 12.
Physicians, pharmaceutical companies, insurers, manufacturing companies and other commercial interests have for years done all in their power to limit state law suits in which injured parties seek compensation for injuries suffered as a result of defective products or negligent services. The Republican party has supported this "tort reform" movement for years, but when they controlled both Congress and the Executive between 2001 and 2007, they enacted little legislation to further "reform" goals. With Democrats now controlling Congress, "tort reform" is dead in Congress.
The Bush Administration is, nevertheless, moving to limit or prohibit state product and service liability litigation. The Judiciary Committee Hearing on September 12 and a recent report by The Center for Progressive Reform describe the complex and stealthy means by which it is doing so.
Briefly, the administration uses the legal claim of "preemption" to do this. Article IV, Clause 2 of the Constitution (The Supremacy Clause) provides that laws duly enacted by Congress are "the supreme Law of the Land . . . any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." Any state or municipal law that directly contradicts a law enacted by Congress and signed by the President is therefore invalid. Moreover, Congress has the power of "express preemption". It can enact laws that dictate which level of government will have power over a specific kind of policy.
The Supreme Court has also developed a doctrine of "implied preemption". Where Congress enacts a law that is silent on preemption, but it may reasonably be inferred that Congress' intentions are frustrated by a state or local law, the Court has struck down those laws. Until 1992, the Court struck down only "positive law" (enacted laws, rules and regulations applicable to every entity in the same situation). In the absence of clear Congressional intent, it did not preempt tort law, the area of civil law that provides remedies to individuals harmed by a non-contractual wrongs, including personal injury resulting from negligence, property injury resulting from nuisances or trespass or injuries to personal reputation from libel or slander. Judgments under tort law were seen as individualized remedies for specific harms, not as laws or regulations with generalized impact on entire classes of people or entities.
In Cipollone v. Liggett Group, Inc., (1992), the Court ruled that a Congressional preemption, although it did not clearly apply to tort law, did nevertheless preempt it. Since then the Court has issued conflicting rulings on the issue.
The fact that laws enacted by Congress and approved by the president are implemented by detailed regulations written by Executive Branch administrative agencies adds yet another layer of complexity to the process. In writing laws, Congress enunciates broad principles and requirements, but delegates to administrative agencies the responsibility of specifying through regulations the detailed requirements that will achieve these principles and requirements. Such agencies operate sometimes in secrecy and always far removed from the public eye. They are extremely susceptible to the lobbyists working for the industries they regulate. Often, they are led and staffed by people who once worked for and/or hope to work for companies within those industries. Most significantly in this context, they are controlled by the Executive branch, to the extent that the regulations they issue must be approved by the President's Office of Management and Budget before they are made public.
It is at this "rule-making" level that the Bush Administration has asserted the sort of tort law preemption that its corporate supporters have advocated for years. Aware that the Supreme Court's preemption jurisprudence is not settled, the Administration has adopted a systematic and aggressive campaign to move the Court toward a position receptive to an acceptance of implied tort law preemption.
Prior to the Bush Administration, regulatory agencies generally opposed the preemption of state tort law remedies or took no position on the issue. In a complete departure from that position, The National Highway Traffic Safety Administration (NHTSA) in 2005 wrote a regulation regarding the placement of seat belts and standards for roof crush resistance in case of vehicle roll overs. Although it recognized that Congress had expressly preempted only state positive law, it nevertheless asserted that tort law was impliedly preempted by the regulation, that is, no liability claim could be brought in state court if NTSA standards were met. In 2006, the Food and Drug Administration (FDA) issued a regulation regarding drug labeling. The FDA also asserted that state tort remedies were preempted if the grounds for the claim were based on a company's failure to provide warnings considered but rejected by the FDA. Similarly in 2006, the Consumer Products Safety Commission (CPSC) issued a rule specifying mattress flammability standards and declared tort claims based on the failure to provide warnings not included in the CPSC rule preempted. Also in 2006, the Federal Railroad Administration (FRA) issued a proposed rule and a separate final rule that also asserted the preemption of state tort remedies.
If the Courts accept these claims, as a few of them have, the Bush Administration, acting without Congressional authority, will have satisfied their corporate masters yet again. They will have shut the courtroom door to many people injured by defective products and negligent services. And they will have shown any future administration how to shut those doors to even more people. Congress will be rendered irrelevant in this area, just as it has been in the area of war powers.