Back to the Ice House? Obama, Brandeis and Federal Preemption

"As Justice Brandeis explained more than 70 years ago, "[i]t is one of the happy incidents of the federal system that a single courageous state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country."

Barack Obama, May 20, 2009 - quoting New State Ice Co. v. Liebmann, 285 U.S. 262 (1932)

The White House today issued a Presidential Memorandum to the heads of all federal agencies. It instructs them to spurn the Bush administration's "backdoor federalization" - use of the regulatory preamble to establish federal preemption of state law where neither regulation nor statute explicitly called for it. Obama mandated a review of preemptive regulations taken in the past 10 years:

"3. Heads of departments and agencies should 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. Where the head of a department or agency determines that a regulatory statement of preemption or codified regulatory provision cannot be so justified, the head of that department or agency should initiate appropriate action, which may include amendment of the relevant regulation."

But federalism is a wall on which all can write, as the Bush administration did despite leaving untouched Clinton's 11th hour Executive Order 13132 - Federalism. The first federalists were nationalists. Today's are states righters - except when it comes to litigation costs that business would rather avoid.

Momentum matters in football, and in litigation. Catherine Sharkey and Samuel Issacharoff described that momentum in Backdoor Federalization, 53 UCLA L. REV. 1353 (2006). But the Obama memo combined with the plaintiffs' win in Wyeth v. Levine enables us to say that the Big Mo has stalled if not reversed.

Not all have gotten the message. In Bruesewitz v. Wyeth, 561 F.3d 233, the 3rd Circuit found a DPT vaccine design defect claim to be impliedly preempted by the 1982 Childhood Vaccine Compensation Act- despite the Levine decision. The Circuit rejected the Georgia Supreme Court's contrary conclusion in American Home Products v. Ferrari, 284 Ga. 384 (2008)

States are certainly proving to be a laboratory on the same-sex marriage front as Maine has just demonstrated. But the nationalizing argument is certainly stronger when it comes to governing commerce. As Stephen Sugarman has pointed out liberals flip-flopped on tort law. Once celebrants of the regulatory state that FDR built, in the last three decades they became defenders of state prerogatives in tort law.

One cannot accuse the plaintiffs lawyers of flip-flopping. The American Association for Justice (once the National Organization of Claimants Compensation Representatives, then the Trial Lawyers) [of which I am a long-time member] was built by the `King of Torts' Melvin Belli and then-retired Harvard Law School Dean Roscoe Pound, a New Deal skeptic. John Fabian Witt in Patriots and Cosmopolitans has brilliantly chronicled that history.

Today Obama's regulatory policy czar Cass Sunstein is unlikely to follow the Roscoe Pound model. In `Is Tobacco a Drug? Administrative Agencies as Common Law Courts', 47 DUKE L.J. 1013 (1998) he defended the Clinton Administration's expansive view of FDA jursidiction over tobacco. And his pro-regulatory cost-benefit approach is controversial among those who claim to comprehend it. See, e.g. his Catastrophic Harm Precautionary Principle here.