President Obama's Memorandum for the Heads of Executive Departments and Agencies: Another Nail in the Preemption Coffin

06.15.11 | Permalink

As discussed in the May 5, 2011 blog entry, the U.S. Supreme Court unanimously decided Williamson v. Mazda Motor of America, Inc., 562 U.S. ___ (2011) which prescribed the analysis for determining preemption in situations where a regulation provides manufacturers with a choice of design alternatives. The court explained that the key question is whether the state lawsuit stands as an “obstacle to a significant regulatory objective.” According to the Court, determining whether a suit is an obstacle to the accomplishment of a significant federal objective requires looking at (1) the regulation itself, (2) the regulatory objectives and (3) the agency’s current position on preemption. 

On May 21, 2009, President Obama issued his “Memorandum for the Heads of Executive Departments and Agencies.” The Memorandum provides directives to regulatory agencies to “ensure that executive departments and agencies include statements of preemption in regulations only when such statements have a sufficient legal basis.” Two of these directives tell Heads of departments/agencies NOT to:
 

  •  “include in the regulatory preambles statements that the department or agency intends to preempt State law through the regulation except where preemption provisions are also included in the codified regulation”; and
  •  “include preemption provisions in codified regulations except where such provisions would be justified under legal principles governing preemption, including the principles outlined in Executive Order 13132.”

A third directive requires agencies to review all regulations issued during the previous ten years to determine if preemption statements in preambles or codified regulations are justified and, if not, to “initiate appropriate action, which may include amendment of the relevant regulation.” 

The Memorandum essentially eliminates two of the key factors recognized by the Supreme Court in Geier and Williamson as being necessary to determining whether a state lawsuit is an obstacle to a significant regulatory objective and therefore preempted. As a result it will drastically reduce the availability of preemption defenses. 

First, by directing agencies not to include express preemption provisions in codified regulations, except in very limited circumstances, future regulations will likely not contain any express preemption language.  

Second, by directing agencies not to include statements that the agency intends to preempt state law in regulatory preambles, the Memorandum eliminates the second factor identified by the Supreme Court for determining preemption: the regulatory agency’s intent. In both Geier and Williamson, the Court pointed out the importance of reviewing the regulatory history to assess the agency’s intent behind enacting the regulation. The Memorandum expressly directs agencies not to include preemption language in the regulation’s preamble, thus it will be virtually impossible to find language in the regulatory history which would show that the agency intended to preempt State law.

Finally, the Memorandum does not just apply to future regulations, but directs the agencies to pore over ten years of already codified regulations and, unless the agency can justify a preemption provision, to purge from the regulations any preemption provisions or language regarding preemptive intent. There have already been instances in which preemption provisions were deleted during the rulemaking process and replaced by final-rule statements that the regulation is not intended to have a preemptive effect upon state law.

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