The Center News: January 15, 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  

January 15, 2014

Center Perspectives  

By Patrick Forrest, Vice President and Deputy General Counsel  

Last June, without any provocation or advance notice, the Equal Employment Opportunity Commission (EEOC) delivered an e-mail blast to the business inboxes of 1,169 Case New Holland (CNH) employees. The blast e-mail advised the employees, including more than 100 managers, that the EEOC was investigating the company for age discrimination. It then directed the employees to provide the government evidence of discrimination and personal contact information through a secure Internet site. The EEOC later admitted that it was trolling for class-action plaintiffs to sue CNH.

CNH filed a lawsuit seeking a declaratory judgment that the EEOC overstepped its authority under its governing statutes and the U.S. Constitution. After the EEOC moved to dismiss the complaint, the NAM filed an amicus brief opposing dismissal and stating that the EEOC's actions constitute an unlawful taking of the time during which plaintiffs' pay their employees to conduct work. The EEOC then took the highly unusual step of replying to our brief, calling it "unprecedented" and asking for an extension to file its full reply. The substance of the EEOC's full reply demonstrates the significance of the NAM's argument.

The NAM is working on a merits brief expanding on our arguments""namely, that the EEOC violated the Fourth and Fifth Amendments.

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MCLA in the Courts  

NAM Victory in Poster Rule Sealed: The NAM prevailed in our challenge to the National Labor Relations Board's (NLRB) so-called poster rule, which would have required manufacturers to post a notice in their workplaces informing employees of their right to organize and strike. The NLRB missed the deadline to appeal to the Supreme Court, leaving our victory in a federal appeals court intact. The victory was a strong rebuke to the NLRB's overreach, protects manufacturers' First Amendment rights and saves manufacturers from an onerous and unfair mandate.
More Information:NAM v. NLRB  

Class Actions
High Court to Examine Significant Driver of Securities Class Actions: The Supreme Court agreed to hear arguments in a case testing the fraud-on-the-market theory, a judge-made theory that has led to the proliferation of securities class-action suits over the past 30 years. The NAM and other groups filed an amicus brief arguing that the Court should overrule or modify the presumption of reliance on the theory. The NAM had previously filed a brief urging the Court to accept this case.
More Information:Halliburton Co. v. Erica P. John Fund, Inc.  

Supreme Court Deals Setback to Class Action Fairness Act: On January 14, the Supreme Court ruled that the Class Action Fairness Act's (CAFA) removal requirements do not apply in a case brought by the attorney general of Mississippi on behalf of the state's citizens. The NAM filed an amicus brief arguing that there should be no presumption against the removal of such cases from state court. Our novel argument is still available for future cases, since the Court focused its ruling on the unique nature of suits brought by state attorneys general.l
More Information:Mississippi v. AU Optronics Corp.  

Government Regulation
"Net Neutrality" Regulation Meets Defeat in Federal Court: A federal appeals court ruled on January 14 that the Federal Communications Commission (FCC) overstepped in issuing its "net neutrality" rules, which regulate how Internet service providers handle Internet traffic activity. The NAM filed a brief opposing the FCC's authority on net neutrality.
More Information:Verizon v. FCC  

Conflict Minerals Rules Meet Resistance in Appeals Court: Earlier this month, a federal appeals court heard arguments in the NAM's challenge to the Securities and Exchange Commission's (SEC) conflict minerals rules. The SEC faced difficult questioning about its rule and First Amendment objections to it. A decision is expected before May 31, when companies must submit reports required by the regulation.
More Information:National Association of Manufacturers v. SEC  

Court Narrows Scope of OSHA's Communication Standard for Hazardous Chemicals: In response to a challenge by the American Tort Reform Association over the Occupational Safety and Health Administration's (OSHA) hazard communication standard, OSHA conceded its statement on the preemptive efffect of the rule was merely an "interpretive statement" that does not have the force of law.
More Information:American Tort Reform Association v. OSHA  

Activists Test Novel Theory in Appeals Court: An environmental group is seeking to impose further greenhouse gas emissions limits by judicial fiat. Under the "public trust" theory advanced by the group, a judge could force the government to enact more stringent air emissions standards. The NAM intervened in the case in the trial court and helped obtain the favorable ruling there. We believe the public trust theory is a state law doctrine and does not implicate a federal question subject to jurisdiction in the federal courts. The case is currently before the D.C. Circuit.
More Information:Alec L. v. McCarthy  

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Other News  

FDA No-Call Adds More Uncertainty: Earlier this month, the Food and Drug Administration (FDA) decided to stay out of the fray surrounding the labeling of food products. Consumers across the country have filed lawsuits alleging that food bearing labels describing the product as "natural" contained genetically modified ingredients. As Reuters' Alison Frankel reports, some judges put the cases on hold to wait for the FDA to issue guidance on food labeling. The FDA won't be issuing that guidance.

As a result, "individual federal judges"""˜probably the least equipped of all lawmakers,' [the Washington Legal Foundation's Glenn Lammi] said""will have to make their own determinations about labeling of genetically modified foods. The outcome will probably be a confusing patchwork of judicial decisions""and more litigation over bio-engineered ingredients."

What's in Store for Employment Litigation: When it comes to employment suits, 2013 was a tough year for plaintiff's attorneys, but Forbes ' Daniel Fisher writes that the tide could turn in 2014: "New plaintiff strategies, combined with the Obama administration's aggressive litigation agenda, mean employers may face an expensive 2014 as they battle wage-and-hour suits by private attorneys and mass discrimination complaints filed by the Labor Department."

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