Consumer Law & Policy Blog

House to vote on fast track trade authority today -- key test for TPP

A collection of coverage ahead of the likely vote:

The Post on how the President is trying to fight for his legacy.

Mother Jones on the stakes and potential future trade agreements.

L.A. Times on Democratic intra-party struggles. (Great picture on the web of Rep. Brad Sherman, who appears to be telling the President that what he wants is "inconceivable.")

A lot of the focus is on the politics of the bill rather than the policy, unfortunately. My favorable substantive commentary remains this op-ed from a few months back by Sen. Warren.

WTO speaks; the House deregulates

The Hill reports on a concrete example this week of international trade rules interfering with U.S. regulatory policy:

The House passed legislation late Wednesday that would repeal country-of-origin labeling requirements for beef, pork and chicken products.

Why the change?

The World Trade Organization (WTO) ruled last month against the U.S. appeal to keep its existing country-of-origin labeling regulation for imported cuts of beef and pork. The regulation, issued in 2013, would require meat labels state where the livestock was born, raised and slaughtered.

A lot of consumers care where their meat is coming from, for health or other reasons, but international trade law, it seems, will be putting a stop to that.

One can expect this is only a taste of what's to come if the Trans-Pacific Partnership and its industry-favoring dispute mechanisms become law (as we've discussed).

Here's the whole Hill story.

FDA petitioned to ban eight food flavors

The Hill reports:

Health groups are petitioning the Food and Drug Administration (FDA) to ban eight synthetic flavors in food that are known carcinogens. The petition, led by the Natural Resources Defense Council (NRDC), said the flavors, which have been used for over 40 years, are found in ice cream, candy, baked goods and beverages.

 

Why does a sandwich chain need a non-compete clause?

In the wake of reports that low-wage workers are being subject to non-compete clauses (i.e., terms in their employment agreement that limit the ability to work for other companies in the same field after leaving their current employment), Senators Franken and Murphy introduced a bill last week to protect workers' ability to switch jobs. As the Washington Post reports, the "catchily titled the Mobility and Opportunity for Vulnerable Employees (MOVE) Act ... would ban non-compete agreements for workers making less than $15 an hour, or $31,200 a year, unless the minimum wage in their jurisdiction is higher." Read the whole story here.

 

CFPB to oversee nonbank auto finance companies

The Consumer Financial Protection Bureau has published a rule allowing the agency to supervise larger nonbank auto finance companies. The CFPB press release is here. The rule is here.

The CFPB also released the examination procedures that examiners will use to ensure that auto finance companies are following the law. The examination procedures are here.

Generic drugs, product safety, liability, and preemption

For a new article on these topics, take a look at Federal Preemption of Generic Drug Claims: Product Safety, Potential Regulatory Changes and Plaintiff Strategies in the Aftermath of Mensing and Bartlett by Eric Lindenfeld and Jasper Tran. Here is the abstract:

Recent research indicates that the current cost of generic medications in the United States is the highest in history. Many patients are no longer able to afford life saving medications that were once affordable only five years ago. Concurrent to the rising prices of generic drugs, pharmaceutical companies have lauded preemption as a necessary and viable solution to combat the increasing prices. Two recent Supreme Court decisions have agreed with this logic, and have attempted to pervert the Hatch-Waxman Act, and its corresponding ANDA approval process to shield generic drug manufacturers from liability. Not only has this immunity done nothing to combat the price of drugs, but it has also decreased incentives for generic manufacturers from engaging in thorough pre-market testing and studies, putting consumers of generic drugs at an increased risk of injury.

This paper proceeds in six parts. Part I provides background of federal preemption as well as the FDA’s "NDA" and "ANDA" approval processes for generic drugs. Part II explores the federal preemption analysis of generic drug claims made in three recent Supreme Court decisions. Part III explores in-depth the damaging effects that these decisions have on the safety of consumers, and the long-term vitality of the generic drug industry. Having established that preemption of generic drug claims is undesirable, Part IV identifies recent attempts by the FDA to introduce regulatory changes that eliminate preemption of generic drugs. Part V explores cutting edge strategies that have been used by plaintiff lawyers to circumvent, reframes and distinguishes the Supreme Court decisions. Part VI concludes.

 

Federal Court in Utah Holds California Anti-SLAPP Statute Applicable to Diversity Defamation Action

by Paul Alan Levy

Judge Tena Campbell of the United States District Court has issued an interesting decision holding that a California woman sued in diversity by a Utah company may file a special motion to strike the plaintiff’s defamation claim.   The case involves a suit by the “Diamond Ranch Academy” against Chelsea Filer, a California woman whose own experiences at a residential youth treatment center stimulated an interest in abuses at such places generally.  Her web site Diamond Ranch Academy Survivors criticizes the plaintiff company.

Parting company with a recent ruling of the D.C. Circuit in Abbas v. Foreign Policy Group, which was discussed in the briefs but is not mentioned in the opinion, Judge Campbell finds a special motion to strike analogous to a summary judgment motion and hence not in conflict with the Federal Rules of Civil Procedure.  Disposing easily of a consideration that influenced the Abbas panel, Judge Campbell holds that because the California anti-SLAPP creates an exception to the general stay of discovery once an anti-SLAPP motion is filed, allowing the trial court to permit discovery when good cause is shown, the California statute’s treatment of discovery is analogous to Rule 56(d), under which a demonstrated need for discovery can provide a basis for deferring a ruling on a summary judgment motion.

Looking for Help on FDCPA Survey

by Jeff Sovern

I am working on a survey designed to determine consumer awareness of the Fair Debt Collection Practices Act validation notice.  The plan is to show respondents a debt collection letter that includes a standard validation notice, and then ask questions to see how aware they are of the notice and how they understand it.  I would love to run the questions past people who litigate FDCPA cases or are otherwise knowledgeable about the validation provision. If you are willing to take a look at the survey and comment, please email me at sovernj @ stjohns dot edu.

Thanks!

Lotteries and the poor

A recent Washington Post article focuses on something many of you probably know: lotteries are terrible for poor people, because lottery participants are disproportionately poor and (of course) the odds against winning are astronomically high. The Post story also makes another, more subtle point about the problem with lotteries: many people write off the deleterious effects of lotteries on poor people as the product of voluntary choice. But that’s an easier opinion to hold if you’re someone with more choices to begin with. The article explains:

It's not that poor people don't understand that the lottery has a near-zero chance of making them dynastically wealthy. It's that they think everything else has an actually-zero chance. That's why ... people making less than $30,000 are 25 percent more likely to say that they buy lottery tickets for money than for fun, while it's the opposite for everyone else. State lotteries, in other words, don't just prey on poor people's dreams—they do that for everyone—but rather on desperate dreams.

Read the article here.

Finanical regulators issue standards for assessing diversity practices of regulated entities

The agencies' joint press release explains:

Section 342 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) required the Federal Reserve Board, the Consumer Financial Protection Bureau, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Securities and Exchange Commission to establish an Office of Minority and Women Inclusion (OMWI) at each agency to be responsible for all matters relating to diversity in management, employment, and business activities. The Dodd-Frank Act also instructed each OMWI director to develop standards for assessing the diversity policies and practices of the agencies’ regulated entities.

The final standards, which are generally similar to the proposed standards, provide a framework for regulated entities to create and strengthen their diversity policies and practices—including their organizational commitment to diversity, workforce and employment practices, procurement and business practices, and practices to promote transparency of organizational diversity and inclusion within the entities’ U.S. operations.

Read the agencies' final standards here.