Open for Business: Roberts Court Delivers Another Victory for Business in a Major Torts Ruling

As the legacy of the Roberts Court has started to form over the last few years, one of its most pronounced trends has been a highly pro-business bent. This trend continues this term with a series of rulings, including a very significant ruling in favor of medical manufacturers on the question of federal preemption in torts in Riegel v. Medtronic.

On one level, the 8-1 ruling in the case of Charles Riegel was not the result of the addition of Roberts and Sam Alito to the Court given the agreement of the other justices. Only Justice Ruth Bader Ginsburg dissented. However, it fits nicely in a series of cases where business interests have tended to prevail with the Roberts court.

Riegel died three years ago due to an allegedly defective Medtronic catheter that ruptured during heart surgery in 1996. His widow sued under New York law, but the company argued that it was protected from such state lawsuits as a matter of federal preemption. The company argued that the pre-market testing and approval of the FDA preempted such state actions.

The Court agreed. Justice Antonin Scalia, writing for the majority, said medical devices of this kind are pre-approved under the FDA’s most stringent testing procedures. His opinion turned on statutory interpretation of the act. He noted that Congress responded to many lawsuits against manufacturers (particularly involving the Dalkon Shield intrauterine device) when it amended the law. When it set up the federal testing system, it precluded states from imposing “any requirement which is different from, or in addition to, any requirement applicable under this chapter.” He interpreted “requirement” to include state tort actions.

Justice Ginsburg disagreed and said that she found not intent in the record “to effect a radical curtailment of state common-law suits seeking compensation for injuries caused by defectively designed or labeled medical devices.” She relief in part on the glaring omission of a remedy for patients as indicative of a contrary legislative intent: “The MDA’s failure to create any federal compensatory remedy for such consumers further suggests that Congress did not intend broadly to preempt state common-law suits grounded on allegations independent of FDA requirements.” She was supported by members of Congress who responded to the ruling with anger and disbelief.

Putting aside the anger, this was clearly a case (again) of extremely poor legislative drafting. The decision, however, represents a significant blow to common law torts. There has long been a view that such pre-approval systems do not preempt common law torts. Indeed, in 1996, the Court ruled that devices approved by the FDA were not protected from state lawsuit. Those devices, however, fell under a different and less stringent process of pre-marketing review.

Other preemption cases are still pending with the Court, so this may be only the beginning of such protections for businesses.

The Riegel decision was accompanied on Wednesday with two other business cases.

In three key business rulings handed down Wednesday, the Supreme Court continued its trend toward freeing companies from the conflicting regulation of 50 different states in favor of one federal regime. In Rowe v. New Hampshire Motor Transport Association, the Court ruled in favor of tobacco companies, holding that the state of Maine could not impose its own legal requirements on delivery companies in order to prevent the delivery of tobacco products to minors. Notably, this decision was written by Justice Stephen Breyer, who has previously shown a tendency to support business interests in rulings. He said such laws interfered with the federal scheme of regulation.

The one case that prevented a clean sweep this week as LaRue v. DeWolff, Boberg & Associates, where the Court ruled that employees can sue employers under the Employee Retirement Income Security Act for mismanaging their 401(k) retirement plans.

The pro-business tilt was one of the expected signatures of the Roberts court, despite angry claims by Roberts supporters that no one could predict his vote patterns. For a prior column, click here and here
For a copy of the opinion, click here

7 thoughts on “Open for Business: Roberts Court Delivers Another Victory for Business in a Major Torts Ruling”

  1. You should be my speechwriter, Patty C! Often I am intoxicated with my own prose and it tends to fly off into rodomontade and rank fustian!

    I thought the Augean Stable cite very apt, myself! I read Bulfinch and other such, when I was a kid and love to throw out classical references. I refuse to allow the virtues of a quasi-Victorian education lapse even in this age of Segway scooters and dual-core microprocessors!

  2. I actually used the “Low Tar Goes to the High Court” thread to alert the community to the new ruling. A bit of a stretch I admit…

    I had forgotten about the other thread!!

  3. Oh, I should mention that in the sea of under-regulation, the Bush Administration does admittedly have one agency that is zealously pursuing its mandate with gusto and indeed avidity.

    The Office of Labor Management Standards.

    Headed by the illustrious Don Todd, the agency racked up an amazing set of convictions for industry malfeasance.

    The industry? Organized labor.

    A bio of Don Todd, says it all:

    http://www.sptimes.com/2007/12/16/Opinion/He_s_not_exactly_a_un.shtml

    I recall Secretary Chao recently bragging about her OLMS conviction rates and being applauded for a job well done.

    The pleased audience? CPAC.

    The Augean Stables have nothing on this Administration.

  4. I posted yesterday on this ruling in another thread, but it bears repeating that were the system not rigged, I think I might agree with the majority in Riegel v. Medtronic. Federal pre-emption of state tort law is not necessarily a bad thing, IF THE SYSTEM IS NOT RIGGED.

    However, during the Bush Administration, the system is very much biased and the regulatory agencies have all been in default of their responsibilities. FDA PMA decisions in this era are highly suspect, but how, if you are a sitting Justice, do you take that into account in deciding a broad principle? You can’t say that the current PMA in question was suspect for partisan reasons. So you sign on hoping that someday the FDA will be returned to its proper role and function (and funding).

    In the current era, were the regulatory agencies acting as judges in courts of law, their manifold conflicts of interest would force them to recuse themselves in almost every case brought before them. But the Justices on the high court have to act as if the agencies were not corrupted and not totally in thrall to the very sectors that they are supposed to regulate.

    Plus, as Professor Turley points out, the current Court is highly solicitous of business interests and also antagonistic toward what it considers the undue expansion of standing for tort granted by the post-war Courts. Their instincts are to trim and trim and trim and I see no end to it for quite a while.

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