The Center Legal News: June 18, 2014

The Center News is a monthly publication that highlights significant cases affecting manufacturers. The NAM's Manufacturers' Center for Legal Action becomes involved in many of these cases to provide the judicial branch with an important perspective it might not otherwise hear. The NAM provides a voice for all manufacturers working to remain competitive amid the complexities of today's legal system.


Council of Manufacturing Associations  

June 18, 2014  

Center Perspectives  

By Thomas C. Kirby, Legal Fellow  

The Manufacturers' Center for Legal Action maintains a sharp focus on legal trends at the state and local levels. Manufacturers feel the impact of state and local laws not only within those jurisdictions, but also nationally.

Recently, the National Association of Manufacturers (NAM) succeeded in encouraging the Texas Supreme Court to review a dangerous precedent that imposed retroactive liability for permanent plant improvements on manufacturers across Texas, but left manufacturers powerless to maintain, update or remove the improvements, or train third parties on proper use. This case breaks from established Texas precedent, and it could set a trend other states may follow when faced with similar issues.

In Colorado, the NAM is promoting the use of "Lone Pine" orders , which can dramatically decrease the delays and costs involved with litigation in state courts. In Vermont, we are challenging burdensome food-labeling requirements because, in addition to compelling speech in violation of the First Amendment, they position the state as the de facto labeling regulator for national companies since few companies produce and sell their food products only in Vermont. In South Carolina, we are supporting preemption of state common law nuisance claims because the same conduct is already strictly regulated by federal authorities, and there is no justification for a patchwork of state laws. In California, we are challenging expensive new cap-and-trade taxes that are imposing significant burdens on manufacturers and generating massive revenues that exceed what is necessary to administer the California Air Resources Board program.

The NAM identifies significant state court cases across the country through independent monitoring and member feedback. The support of NAM members is critical to continuing our efforts in state courts, and we encourage you to alert us to issues that are ripe for state court action.

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MCLA in the Courts  

First Amendment
NAM Pushes Back on GMO Labeling Law: The NAM joined our association allies in a challenge to Vermont's GMO labeling law, which compels speech in violation of First Amendment rights, interferes with interstate commerce and is preempted by federal law.
More Information:Grocery Manufacturers Association v. Sorrell (U.S. District Court for Vermont)

Court Weighs Limits on Government-Compelled Disclosures: The NAM filed a brief in a matter involving the constitutionality of the country-of-origin labeling of meat products. Our brief urged the court to adopt a strict standard of review when considering government-compelled speech about commercial products.
More Information:American Meat Institute v. USDA (U.S. Court of Appeals for the D.C. Circuit)

NAM Supports Tools to Encourage Settlements of Patent Litigation: The NAM filed a brief encouraging meaningful opportunities for the settlement of costly patent litigation without the prospect of unnecessary antitrust scrutiny. Patent litigation settlements are commonly structured using exclusive licensing arrangements, but these have come under fire by plaintiffs who wish to subject these settlements to full-blown "rule-of-reason" antitrust scrutiny with mere allegations of anticompetitive effects.
More Information:In re Lamictal Direct Purchaser Antitrust Litigation (U.S. Court of Appeals for the 3rd Circuit)

Supreme Court Rejects Review of Emissions Liability Case: The Supreme Court declined to review an appeals court's decision to allow property owners to sue a power company under common law tort claiming damages arising from emissions and particulates from the operation of a coal-fired power plant, which had permits from the Environmental Protection Agency (EPA) for the emissions. The NAM led a group of 11 other industry associations in filing an amicus brief urging the Supreme Court to review the case.
More Information:GenOn Power Midwest v. Bell (U.S. Supreme Court)

Iowa Court Permits Clean Air Act Preemption Case to Proceed: The Iowa Supreme Court ruled that a common law tort claim involving pollutants and odors from a plant is not preempted by the Clean Air Act, Iowa law or the political question doctrine. Unless reviewed and reversed by the U.S. Supreme Court, this unfavorable outcome could spawn many similar claims around the country.
More Information:Freeman v. Grain Processing Corp. (Iowa Supreme Court)

Manufacturers Win as Court Jettisons Public Trust Theory: A federal appeals court affirmed the dismissal of a suit brought in federal court in an attempt to force various federal agencies to impose 6 percent annual reductions in greenhouse gases under a public trust legal theory.
More Information:Alec L. v. McCarthy (U.S. Court of Appeals for the D.C. Circuit)

High Court Adds More Certainty on CERCLA Cases: The Supreme Court decided that CERCLA does not preempt state statutes of repose, thus limiting long-term liability under that law for pollution that occurred many years ago. The NAM had urged the Supreme Court to review the case and reverse a lower court's decision extending the deadlines to file lawsuits under CERCLA.
More Information:CTS Corp. v. Waldburger (U.S. Supreme Court)

NAM Pushes Back on MACT Rules: The NAM filed a brief in a case involving the statutory obligations of the EPA to set maximum achievable control technology (MACT) standards for emissions. This case will affect all MACT reconsideration proceedings.
More Information:National Association for Surface Finishing v. EPA (U.S. Court of Appeals for the D.C. Circuit)

Expert Testimony
Supreme Court Passes on Expert Testimony Case: The Supreme Court declined to review a case involving the reliability of expert witness testimony. The NAM joined our association allies to urge the Supreme Court to hear the case and reverse a lower court decision that let stand testimony of an expert who was not adequately vetted by the judge during the trial.
More Information:Accenture v. Wellogix (U.S. Supreme Court)

Government Regulation
Agency Seeks Review of Adverse Decision in Conflict Minerals Case: The Securities and Exchange Commission (SEC) and Amnesty International have filed motions to appeal a decision invalidating part of the conflict minerals rule. They ask the court to hold the case pending the outcome of American Meat Institute v. USDA (described above).
More Information:National Association of Manufacturers v. SEC (U.S. Court of Appeals for the D.C. Circuit)

Labor Law
NAM Resists Department of Labor Overreach: The NAM and our business community allies are pushing back against the Department of Labor's attempt to expand the definition of what is an "integral and indispensable" activity under the Fair Labor Standards Act to include activities such as security checks.
More Information:Integrity Staffing v. Busk (U.S. Supreme Court)

Case Against OFCCP Poster Rule Continues: The NAM recently filed our reply in opposition to a summary judgment in our challenge of the Office of Federal Contract Compliance Programs' (OFCCP) rule requiring the posting of a notice facilitating unionization.
More Information:National Association of Manufacturers v. Perez (U.S. District Court for D.C.)

NAM Seeks to Protect Employer E-Mail Systems: The NAM and our association allies filed a brief urging the National Labor Relations Board (NLRB) not to create an exception for employer-owned e-mail from the longstanding rule that employees generally have no right to use employer-owned property, equipment or materials for union-organizing activities as long as the employer's restrictions on such usage are not discriminatory.
More Information:In re Purple Communications, Inc. (NLRB)

NAM Backs Boeing after Misguided Decision by NLRB Judge: The NAM filed a brief with the NLRB supporting Boeing in a matter brought by a union accusing the manufacturer of unfair labor practices, one of which involves a policy prohibiting the use of camera-enabled devices, such as smartphones, without prior approval.
More Information:In re The Boeing Company (NLRB)

Court Protects Contract Enforcement with Sovereign Nations: The Supreme Court recently decided that judgments against foreign nations can be pursued without a cloak of immunity from the Foreign Sovereign Immunities Act (FSIA) for post-judgment discovery or information concerning extraterritorial assets. The NAM filed a brief arguing that limiting discovery against foreign states would undermine the enforcement of valid commercial contracts and that extending FSIA immunity to post-judgment discovery against foreign states would necessarily impede discovery against state-run companies.
More Information:Republic of Argentina v. NML Capital, Ltd. (U.S. Supreme Court)

Product and Premises Liability
Texas Court Imposes Forever Liability on Manufacturers: The Texas Supreme Court granted a briefing on the merits in an important case for manufacturers in Texas and nationwide that design and construct permanent plant improvements. The NAM led a coalition of our association allies and encouraged the court to review this case.
More Information:Occidental Chem. Corp. v. Jenkins (Texas Supreme Court)

Punitive Damages
NAM Looks to Rein in Duplicative Lawsuits: The NAM filed a brief in the Louisiana Supreme Court arguing that a punitive damages issue that was fully resolved in one case should not be raised again in a second one involving the same acts, plaintiff and defendant.
More Information:Oleszkowicz v. Exxon Mobil Corp. (Louisiana Supreme Court)

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Other News  

Court Divided on Key Pronunciation Issue: The nine Supreme Court Justices disagree about a number of issues, including how to say " certiorari ."

Possible Implications of Pomegranate Juice Case for Future Food Lawsuits: Glenn Lammi of the Washington Legal Foundation examines the recent decision in a case involving food labels: "In the aftermath of POM Wonderful , one should expect the status quo or perhaps an uptick in state consumer protection class actions nit-picking at marketing claim on processed food labels. Another outcome of the Court's ruling could be a parallel wave of Lanham Act suits from disappointed competitors like POM Wonderful that mimic the consumer class actions' claims."

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