Will the En Banc D.C. Circuit Revive the FDA's Graphic Tobacco Labels?

For months now, we have covered the tobacco industry's First Amendment challenge to the FDA's new graphic cigarette package labels. In late August, we told you about a D.C. Circuit panel decision invalidating the labels. We noted that the case was likely on a fast track to the Supreme Court.

A couple weeks ago, though, the government filed this petition asking the D.C. Circuit to grant en banc review and uphold the FDA labels. The industry has replied, saying that en banc review is unnecessary.

Smoke-free workplace laws may be related to better cardiac health

Should government impose workplace health rules? As explained here, laws requiring smoke-free workplaces may significantly improve cardiac health. An excerpt:

Researchers at the Mayo Clinic in Rochester, Minn. looked at the number of heart attacks among residents of Olmsted County, Minn. that occurred 18 months before and after implementation of laws banning smoking in restaurants in 2002, and the 18 months before and after those laws were extended to include all workplaces, including bars, in 2007. They found that the incidence of heart attack declined by a third (33 percent) from the start of the study to the end (i.e., from the 18 months before the first laws to the 18 months after the second laws went into effect).

Get details on the study, which has been published in the Archives of Internal Medicine.

CFPB Head Cordray Joins Regulators' Letter Opposing Agency Review Bill

The American Banker has the story here and here is the Chicago Tribune's coverage.  The bill would require the CFPB, as well as other independent federal agencies, to jump through additional hoops before adopting regulations.  Many consumer groups have also opposed the bill in a letter.

Student Loan Debt and Older Americans

This Wall Street Journal piece explains that older and middle-aged Americans are saddled with a lot of student loan debt largely because they co-signed their kids' and grandkids' student loans and the kids and grandkids have defaulted.

National Law Journal Article on What Happens to CFPB if Romney Wins

Here. An excerpt:

Lawyers believe Cordray will remain at the helm of the agency until his appointment expires in December 2013, though some predict he'll step down a few months early to run for governor of Ohio. As a result, the CFPB — at least initially — is likely to hold course. That means more enforcement actions and a heightened focus on the mortgage industry, including mortgage servicing, settlement procedures and disclosures.

* * *

Once Cordray's term is up and if Romney chooses his replacement, the effect on the agency could be dramatic, said Richard Gottlieb, who is the head of Dykema Gossett's financial industry group. * * * The potential result: fewer enforcement actions, milder penalties and regulations that give more weight to industry concerns.

New Class Action Fairness Act Ruling from the Fourth Circuit

Last Thursday, In AP Optronics v. State of South Carolina, No. 11-254, the Fourth Circuit held that federal jurisdiction under the Class Action Fairness Act ("CAFA") was lacking because the State of South Carolina (and not its individual citizens) was the real party in interest in South Carolina's state-law antitrust action against the manufacturers of liquid crystal displays. Thus, CAFA's “mass action” provision did not apply, see 28 U.S.C. 1332(d)(11), and the district court was therefore correct in remanding the case back to the state court in which South Carolina had filed the action. (Among other things, to be a "mass action" under CAFA, the plaintiffs must propose that the claims of at least 100 plaintiffs be tried jointly.) The Fourth Circuit's decision is worth a look.

Are Angry Birds Spying on You?

by Jeff Sovern

The Times reports that many phone apps, including the Angry Birds game (and the flashlight apps that many who lose power because of the storm on the East Coast today may use), spy on their users--and usually without the users' knowledge.  Sometimes they gather information from contact lists and even from photos. 

How should the law respond to this?  Is disclosure enough?  But will consumers read the disclosures?  More and more evidence suggests they won't.  I wonder if a prominent disclosure would work--rather than simply burying it in a EULA--or a letter grade that told consumers how protective of their privacy the app is.

ProPublica Article: Freddie Mac Wouldn't Refinance Mortgages and Prevent Foreclosures. Why? It Wanted to Keep Its Profits High and Did Not Want to Stimulate the Economy.

This ProPublica article by Jesse Eisinger explains that, during the depths of the Great Recession, Freddie Mac would not lower consumers' interest rates because it wanted to keep its profits high. Here's an excerpt:

Freddie Mac, the taxpayer-owned mortgage giant, made it harder for millions of Americans to refinance their high-interest-rate mortgages for fear it would cut into company profits, present and former Freddie Mac officials disclosed in recent interviews. ... [T]wo Republican-leaning board members and at least one executive resisted a mass refi policy for an additional reason, according to the interviews: They regarded it as a backdoor economic stimulus. Freddie's policy was financially brutal: During the worst years of the Great Recession, when homeowners most needed the savings they could have gotten from refinancing to lower interest rates, Freddie helped keep millions of borrowers locked in high-interest-rate mortgages. A more aggressive refi program by both Freddie and its sister company Fannie Mae would have helped an additional nine million homeowners to refinance, saving them nearly $75 billion in interest payments to date, Columbia University housing economist Christopher Mayer estimates. In addition, it would have prevented hundreds of thousands of delinquencies and foreclosures, he says.

More on the CFPB's Jurisdiction

Recently, we've posted about the degree to which the Consumer Financial Protection Bureau (CFPB) should look out for the interests of the businesses it regulates (in a guest post by Rob Bramson) and the CFPB's assertion of jurisdiction over lawyers' activities in some situations (in a post noting the American Bar Association's opposition).

Now, in a guest post, CL&P Blog reader and consumer lawyer Nicole Mayer expresses her view:

GUEST POST

The work of the Consumer Financial Protection Bureau over the past few months has sparked complaints about its seemingly wide-spread jurisdiction.  The complainants keep forgetting that this is the CONSUMER FINANCIAL Protection Bureau.  What’s in a name?  A lot!

One has to wonder if the same group of dissenters would find it acceptable to limit other government agencies in the same manner they wish to limit the CFPB.  Would they take issue with a decree that the Department of Justice could carry out justice in no cases except those involving murder?  What would they think about the Food and Drug Administration having authority to regulate food but not drugs?  What if we took away the Federal Communication Commission’s ability to oversee anything except radio broadcasting?  Or, what would the reaction be if the Bureau of Alcohol, Tobacco, Firearms and Explosives only had authority to safeguard the public against tobacco?  You catch my drift. 

If government agencies did not have jurisdiction over the fields their very name includes, we would find ourselves in need of a million different agencies and would face a whole new host of complaints.  The issues taken on by the CFPB all focus on protecting consumers in consumer financial transactions and are therefore, legally within its purview. 

Shay Lavie Paper on Class Actions

Shay Lavie of Harvard has written The Malleability of Collective Litigation, forthcoming in the Notre Dame Law Review. Here is the abstract:

In Wal-Mart v. Dukes (131 S.Ct. 2541 [2011]), Wal-Mart avoided class action because employment decisions were made by local supervisors. However, it was Wal-Mart who chose to delegate discretion; by doing so, it made class litigation less likely. Wal-Mart’s choice of business administration, then, substantially reduces its expected liability. This is but one example of a broader, overlooked phenomenon. Mass defendants can control, before the occurrence of damages, the scope of future collective litigation. Collective litigation procedures are malleable, sensitive to the defendant’s pre-damages choice of actions. The Article develops and substantiates this insight.

The Article elaborates on two manifestations of this phenomenon. First, defendants can avoid class actions by “individualizing” the prospective class, injecting individual differences that preclude class treatment. Second, defendants can selectively contract with future victims, buying out the stronger, leaving only weak victims with a claimable right, and reducing the prospective class’s capacity to litigate. Against this backdrop, the Article proposes an array of mechanisms to strengthen collective litigation procedures, including shifting the burden to defendants to justify the business action that prevented collective litigation, and taxing defendants for making the plaintiffs’ case weaker.