White House Announces Major Policy Change on Preemption
President Barack Obama (D) has released a memorandum to the heads of executive departments and agencies instructing them to “include statements of preemption in regulations only when such statements have a sufficient legal basis.” Under the Bush administration, a number of health and safety agencies, including the Food and Drug Administration, often placed such statements in a regulation’s preamble, attempting to prevent those injured by the consumer products subject to the regulation from bringing state-law based product-liability litigation against manufacturers.
Acknowledging the previous practice, the memorandum indicates that its purpose “is to state the general policy of my Administration that preemption of State law by executive departments and agencies should be undertaken only with full consideration of the legitimate prerogatives of the States and with a sufficient legal basis for preemption. Executive departments and agencies should be mindful that in our Federal system, the citizens of the several States have distinctive circumstances and values, and that in many instances it is appropriate for them to apply to themselves rules and principles that reflect these circumstances and values.”
The memorandum also directs the agencies to “review regulations issued within the past 10 years that contain statements in regulatory preambles or codified provisions intended by the department or agency to preempt State law, in order to decide whether such statements or provisions are justified under applicable legal principles governing preemption.” If the preemption provisions are unjustified, the agencies are directed to initiate appropriate action, “which may include amendment of the relevant regulation.” Government officials have apparently indicated that this review of existing regulations could take weeks or months, particularly where the preemption clause was part of a formal rulemaking process.
The U.S. Chamber of Commerce and industry interests, long concerned about complying with varying standards and rules at the state level, have reportedly criticized the change, claiming that it will interfere with the nation’s economic recovery, add to the cost of consumer products and result in a lot of unnecessary litigation. A Chamber spokesperson said, “Allowing for more lawsuits will not create more jobs, except maybe for plaintiffs’ lawyers.” Consumer advocates praised the action. California Attorney General Jerry Brown was quoted as saying, “This directive is a very positive sign that the federal government will get out of the way and let state attorneys general defend their citizens from predatory lending, dangerous products and environmental hazards.” See Business Week, May 20, 2009; The Wall Street Journal, May 21, 2009.
