Obama's Preemption Memo: A Return to Normal

Yesterday, President Obama issued a two-page memo that did three things:   First, it recognized that, under the Bush administration, some agencies and departments announced that their regulations preempted state law even when should not really have done so.  Second, it provided that his administration would not do that. 

So far, not a particularly controversial memo, right?.  If there's no legitimate basis to preempt state law, don't do it.  If you think there is a basis to do so, do the legal analysis to make sure.

What has both sides of counsel table all whipped up is the third part.  Because some recently enacted (say, oh, in the past ten years) regulations contained preambles that stated they preempted state law (or codified preemption provisions) even where there was no explicit preemption by Congress or other sufficient legal basis, Obama also ordered all department and agency heads to review their regulations to decide whether those statements and provisions are "justified under applicable legal principles governing preemption."  If a department and agency head determines that a preemption statement or provision cannot be justified, then he or she is to take "appropriate action."

According to the Wall Street Journal and some commentators (including Overlawyered,  The BLT, and The WSJ Law Blog) this is a big win for the plaintiff's bar.

But isn't it really just a return to the, you know, law?  As the WSJ article noted, back in March, in Wyeth v. Levine, The Supreme Court struck down a preemption statement in the preamble to a 2006 FDA regulation, calling it, among other things, "inherently suspect."

Look, we defend companies, so we do understand the concern that returning to established preemption principles could lead to a spate of costly (and certainly some friviolous) lawsuits.  A return to the rule of law might just be worth it.

Will PA Expand Products Liability Claims?

Last month, the Third Circuit anticipated that the Pennsylvania Supreme Court would abandon Pennsylvania's particularly strict strict liability standard in favor of the standard set forth in the Restatement (Third) of Torts.  In Berrier v. Simplicity Manufacturing, Inc., the Third Circuit considered whether a five-year-old girl who was injured when her grandfather backed over her foot with a riding lawnmower could recover under Pennsylvania’s strict products liability law.  The lawnmower in question was not equipped with back-over protection.

The Third Circuit predicted that, if confronted with the question, the Pennsylvania Supreme Court would afford a bystander who was not the intended user of a product a strict liability cause of action to recover for injuries sustained while an intended user was operating the manufacturer’s product.  This outcome is consistent with the Third Restatement position but represents a departure from Pennsylvania state law.

Manufacturers will want to watch what the Pennsylvania Supreme Court does in the pending case, Bugosh v. I.U. North America, Inc., 942 A.2d 897 (Pa. 2008), which presents this very question.