The Center News: November 2015

A Publication of the National Association of ManufacturerstheCenter for Legal Action

Center Perspectives
By Leland Frost, Legal Fellow

A worrisome trend is developing in the courts: some plaintiffs are attempting to hold manufacturers liable for the acts of parties not in their control under a variety of different legal regimes, including the Alien Tort Statute (ATS), the joint employer doctrine, and the Telephone Consumer Protection Act (TCPA). This potential for endless litigation is fundamentally unfair and raises costs for everyone.

The National Association of Manufacturers (NAM) has filed many amicus briefs urging courts to clarify and limit the reach of the ATS, including one case currently before the Supreme Court. Expanding the reach of the ATS incentivizes abusive litigation targeting manufacturers and makes working with developing nations excessively risky.

In addition, the National Labor Relations Board (NLRB) recently loosened the standard for determining joint employment under the National Labor Relations Act. The NAM filed an amicus brief outlining the concerns of manufacturers and dangers in changing the standard. For the past 30 years, joint employment has been determined by examining whether an entity exerts a significant and direct degree of control over another business's employees and their essential terms and conditions of employment. Under the new standard, the NLRB will also evaluate whether an entity exercises indirect control over employees' work and terms of employment, greatly expanding the universe of business arrangements that will be viewed as joint employment.

Finally, the Federal Communications Commission issued a declaratory ruling this summer that purports to define and expand the scope of liability for certain telephone calls and text messages to consumers under the TCPA. This ruling would burden a wide range of industries, and several organizations are considering filing briefs challenging the FCC in federal appeals court.

Drawing on decades of precedent in third-party liability—such as in asbestos cases and product modification lawsuits—the Manufacturers' Center for Legal Action (MCLA) is aggressively urging the courts to use a reasonable approach regarding the involvement of third parties in lawsuits. As always, the NAM will continue to fight for manufacturers.

MCLA in the Courts
Class Actions

NAM and Allies Partner in Key Class Certification Matter: The NAM, Washington Legal Foundation and International Association of Defense Counsel filed a brief urging the Supreme Court to hear a case involving the subject-matter jurisdiction of federal appeals courts. Our brief argues for the faithful adherence to the jurisdictional statutes that Congress enacted to prevent multiple, piecemeal appeals from a single district court proceeding.

More Information: Microsoft Corporation v. Baker, et al. (United States Supreme Court)
Conflict Minerals

Manufacturers Secure Another Victory in Conflict Minerals Case: A federal appeals court denied petitions by Amnesty International and the Securities and Exchange Commission (SEC) for a rehearing in the conflict minerals case, leaving the NAM's earlier victory intact. Those parties could still ask the Supreme Court to consider the case. If the Supreme Court does not hear an appeal, the matter will return to a lower court, which will decide whether the entire rule is invalid because of the unconstitutional disclosure requirement or whether the regulation should go back to the SEC for revision.

More Information: NAM v. SEC (United States Court of Appeals for the D.C. Circuit)

NAM Sues EPA Over Clean Power Plan: The NAM is challenging the Environmental Protection Agency's (EPA) final Clean Power Plan rules for existing and new electric utility plants. The rules exceed EPA's authority and set a damaging precedent with broad implications across industries. We are urging a judicial stay of the rules until the litigation can be completed.

More Information: West Virginia v. EPA (United States Court of Appeals for the D.C. Circuit)

NAM Moves to Intervene in Public Trust GHG Case: The NAM and its business community allies are seeking to intervene in a federal suit brought by environmental activists who want judges to impose environmental standards on the economy. This is the second case in which manufacturers have intervened to push back against greenhouse gas (GHG) regulations through public trust litigation. The first such case was ultimately dismissed.

More Information: Juliana v. United States (United States District Court for the District of Oregon)
False Claims Act

NAM Fights Abuse of False Claims Act: The NAM filed a brief asking the Supreme Court to hear a case involving whether relators filing False Claims Act claims must include specific allegations of false claims in their pleadings. There is currently a split among the federal circuits as to whether the Federal Rules of Civil Procedure require such a specific pleading in False Claims Act cases. Our brief argues that this circuit split encourages speculative claims and forum shopping.

More Information: AT&T v. US ex rel. Heath (United States Supreme Court)
Free Speech

Manufacturers Proceed with GMO Labeling Suit: Manufacturers' suit challenging the constitutionality of Vermont's law requiring labeling of certain products containing genetically engineered ingredients has moved into the discovery phase. Vermont is seeking extensive information from groups, such as the NAM, challenging the law, and we are fighting these inappropriate and burdensome discovery requests.

More Information: Grocery Mfrs. Assn. v. Sorrell (United States District Court for the Second Circuit)

NAM Urges Top Court to Invalidate Protectionist State Law: The NAM submitted a brief urging the Supreme Court to reverse a lower court's decision upholding Connecticut's laws that protect state auto dealers at the expense of manufacturers. Connecticut's protectionist laws impose artificially high costs on out-of-state manufacturers and consumers.

More Information: Alliance of Automobile Manufacturers, Inc. v. Currey (United States Supreme Court)
Product Liability

NAM Opposes Weak Proof of Injury in Georgia Asbestos Case: Manufacturers are urging the Georgia Supreme Court to require that expert witnesses say how much exposure to a hazardous substance causes injury, and how much the plaintiff was exposed to it, before a company can be held liable. Weak evidence rules for proving exposure to asbestos will lead to excessive litigation.

More Information: Scapa Dryer Fabrics, Inc. v. Knight (Georgia Supreme Court)
Questions or Comments?

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

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