The Center News: March 2015

A Publication of the National Association of ManufacturerstheCenter for Legal Action

Center Perspectives


By Quentin Riegel, Vice President and Deputy General Counsel

The EPA Spreads Its Regulatory Wings Abroad

Can the Environmental Protection Agency (EPA) enforce U.S. air regulations against motor vehicle plants in Sweden? That’s what most people would call overreaching. While the Clean Air Act does allow such enforcement for engines made abroad that are offered for sale here, the EPA’s statutory authority does not extend to engines destined for other countries.

And that makes sense. What if Sweden, or any other country, wanted to enforce its environmental laws against products made and sold here? We would not stand for it. Aside from the fundamental problems that would arise from this conflict between different sovereigns, how would a manufacturer practically be able to comply with all the different environmental laws of the world?

The Manufacturers’ Center for Legal Action (MCLA) is supporting an appeal of a case to the Supreme Court raising just this issue. The case arises in the context of a consent decree that was voluntarily entered into by a Swedish engine manufacturer to comply with U.S. air regulations. The EPA, however, used the agreement to expand its domestic regulatory authority to 7,262 engines sold outside the United States and imposed a $62 million penalty on the company. The EPA’s authority is even more questionable because the engines were not made by the company but by an affiliate, and the requirements alleged to have been violated involved accelerated compliance deadlines that did not apply to other companies. Our amicus brief authored by Professor Laurence Tribe of Harvard University urges the court to hear the case and rein in the EPA’s attempt to regulate the world.

MCLA in the Courts


Employment Law


Manufacturers Look to Rein in Broad Liability Theories: The National Association of Manufacturers (NAM) filed a brief with the Indiana Supreme Court asking it to invalidate a lower court’s ruling allowing vicarious employer liability for employee misconduct.

More Information: Hinchy v. Walgreen (Indiana Supreme Court)


Texas to Rule on Local Overreach on Clean Air Issues: The Texas Supreme Court will review a lower court’s ruling that allows Houston to run its own clean air enforcement office. The Houston ordinance is part of a growing trend by cities to go beyond state environmental restrictions. Arguments are scheduled for March 25.
More Information: BCCA Appeal Group, Inc. v. City of Houston (Texas Supreme Court)

NAM Files Reply in Incinerator Case: On February 24, the NAM filed our reply brief in a case challenging various portions of the EPA's rule on Commercial and Industrial Solid Waste Incinerators.

More Information: American Forest & Paper Assn. v. EPA (U.S. Court of Appeals for the D.C. Circuit)

EPA Settles Sue-and-Settle Suit: The EPA is settling a suit brought by the Sierra Club to force the agency to designate various areas of the country as “non-attainment” with respect to sulfur dioxide emissions. Our intervention in a related suit has been on hold pending resolution of this case, and the settlement agreement will be published shortly for comments from the public. 

More Information: Sierra Club v. EPA (U.S. Court of Appeals for the D.C. Circuit)



Supreme Court Hears Case on Time Limits to Challenge ERISA Investment Decisions: The Supreme Court heard arguments in a case involving whether ERISA plan participants can challenge investment decisions after the six-year statute of limitations has already run with respect to the initial selection of an investment option. The Ninth Circuit held that these claims were time-barred. The Supreme Court will issue its decision at the end of June.

More Information: Tibble v. Edison International (U.S. Supreme Court)

Expert Testimony


NAM Seeks to Protect D.C. Businesses from Unreliable Expert Testimony: The NAM and eight other organizations filed a brief asking the District of Columbia to adopt the Daubert standard for determining the admissibility of expert testimony in court. Adopting this standard would position D.C. courts as better gatekeepers against unreliable expert testimony.

More Information: Motorola, Inc. v. Murray (D.C. Court of Appeals)

False Claims Act


NAM Seeks to Shield Manufacturers from Massive Liability Claims: The NAM filed a brief in a case involving a 17-year-long civil False Claims Act case pursued against MWI by the Department of Justice. Government attempts to use the False Claims Act to enforce contract terms or regulations that lack clarity can create enormous liability traps for manufacturers selling products to the United States or products that are financed in whole or part by the United States.

More Information: U.S. ex rel. Purcell v. MWI Corp. (U.S. Court of Appeals for the D.C. Circuit)

Intellectual Property


NAM Intervenes in European IP Case: The European Court of Justice granted the NAM intervener status in European Commission v. Stitchting Greenpeace, a case in which the plaintiffs requested the public disclosure of a massive amount of confidential business information relating to certain pesticides used in the United States and Europe. Intervener status is more difficult to obtain in the European legal system because it grants the intervener the ability to argue before the court and have its issues addressed on the merits. By allowing the NAM’s intervention, the court has recognized the interest of U.S. industry in this case.

More Information: European Comm’n v. Stichting Greenpeace Nederland (European Court of Justice)

Labor Law


NAM Pushes Back Against Expanded Scope of Davis-Bacon Act: The NAM recently filed a brief arguing that Davis-Bacon Act does not apply to private construction projects. The Department of Labor is seeking to apply the law to a construction project that is not funded by the government, not constructed by or for the government, not owned by the government, and not occupied in any respect by the government.

More Information: DC and CCDC Office, LLC v. DOL, et al (D.C. Court of Appeals)



Supreme Court Reins in Expansive Application of Sarbanes-Oxley Act: The Supreme Court ruled that the Sarbanes-Oxley Act could not be used to prosecute a fisherman for tossing fish—supposed evidence—off his boat. Instead, the law applies only to “tangible objects” that are used to record or store information. The NAM filed a brief last year supporting this result.

More Information: Yates v. United States (U.S. Supreme Court)

Product Liability


NAM Stares Down California “Super Tort”: The NAM and other business groups filed a brief in a long-running case involving 10 California cities and counties that sued lead pigment manufacturers under a public nuisance theory. A lower court’s ruling strips away traditional product liability elements and defenses in a way that turns a public nuisance claim into a “super tort.”

More Information: California v. Atlantic Richfield Co.  (California Court of Appeals)

California High Court to Decide Liability for Take-Home Exposure to Asbestos: The NAM filed briefs in two cases in which the California Supreme Court will decide whether the state adopts a new and potentially limitless and indefinite liability standard for manufacturers. In the cases, the plaintiffs want to impose liability on manufacturers due to alleged exposure to substances like asbestos inadvertently brought home from the workplace.

More Information: Haver v. BNSF Ry. Co.; Kesner v. Superior Court (California Supreme Court)

Other News


Judge Strikes Down Tennessee Tort Reform: A local judge in Tennessee recently deemed a cap on non-economic damages—a key part of a 2011 tort reform package—unconstitutional. The ruling faces an all-but-certain appeal.


Senate Examines Abusive Patent Lawsuits: The Senate Judiciary Committee is holding a hearing today on “The Impact of Abusive Patent Litigation Practices on the American Economy.”


Questions or Comments?


Contact Senior Vice President & General Counsel Linda Kelly at lkelly@nam.

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