Two by Sharkey

Cathy Sharkey has posted two pieces to SSRN.  First, States v. FDA.  The abstract provides:

In the United States, food and drug safety is regulated in two ways: a stringent ex ante, national regime led by the Food and Drug Administration (“FDA”) and a robust ex post system of state-law enforcement. This federalist structure, operating on dual regulatory levels, sets the stage for synergy and for conflict.

Two recent high-profile preemption lawsuits showcase a novel dimension of the dual regulatory structure: the role of states as competing and/or complementary actors vis-à-vis the FDA in regulating food and drug safety. In Zogenix, Inc. v. Patrick, a federal district court enjoined the Massachusetts government from enacting a statewide ban on Zohydro, an FDA-approved opioid analgesic drug, but upheld the state’s subsequent prescription and dispensation-related restrictions. In Grocery Manufacturers Association v. Sorrell, food industry representatives challenged a recently enacted Vermont law mandating labeling of genetically engineered food—labeling that the FDA had not required.

Both cases explore how states can regulate drug and food safety without treading impermissibly upon the FDA’s turf. In doing so, they raise the issue of who should determine if state regulatory efforts advance or impede the federal regulatory scheme. Are courts or the regulating agencies the better arbiters? If the latter, when are their conclusions entitled to judicial deference, and how much?

This Article advances two primary claims. First, courts, when facing implied obstacle preemption challenges to state regulations, should consider the FDA’s view on the matter—namely whether the agency itself considers the state-level regulation to conflict with its national regulatory agenda. In Zogenix, the court, strikingly, paid no attention to the FDA Commissioner’s overt support of Massachusetts’s proposed restrictions on the prescribing and dispensing of Zohydro. In Sorrell, the court had before it informal policy guidance from the FDA that suggested that the agency was somewhat open to state labeling mandates. Deference to the FDA’s position in each case would have provided clear resolution of the preemption challenge.

Second, these cases reiterate and reinforce the argument at the heart of the ACUS 2010 Recommendation, Agency Procedures for Considering Preemption of State Law: if there is ever to be a coherent body of case law and regulatory policy in the realm of food and drug laws, courts must probe the FDA’s record on its examination and consideration of relevant state interests in the course of the federal regulation enactment process. Rather than blindly deferring to the federal agency’s view, courts should evaluate whether that view was the product of a responsible process that afforded states the chance to articulate how their own proposed state regulation fits with the federal regulatory scheme.

Next, The BP Oil Spill Settlements, Classwide Punitive Damages, and Societal Deterrence.  The abstract provides:

The BP oil spill litigation and subsequent settlements provide an opportunity to explore a novel societal economic deterrence rationale for classwide supra-compensatory damages. Judge Jack Weinstein was a pioneer in the field of punitive damages class certification. In In re Simon II, he certified a nationwide punitive-damages-only class in a multijurisdiction, multidefendant tobacco lawsuit. Using Judge Weinstein’s innovations in In re Simon II as an analytical lens, the Article evaluates the future prospects for classwide punitive damages claims.

Specifically, the Article considers how private litigants might adopt a societal damages approach in negotiating and achieving class action settlements. Class action settlements readily accommodate the “public law” dimension of societal damages, as demonstrated by the classwide punitive damages settlement with BP’s co-defendant Halliburton. Indeed, on closer inspection, even the BP compensatory damages class settlement has a surrounding aura of societal damages. For even that ostensibly purely compensatory arrangement included an unusual (and mostly overlooked) feature: a provision for supra-compensatory multipliers applicable to certain claimants. This Article advances the new idea that these supra-compensatory multipliers are a form of classwide societal damages embedded within the settlement, and, in turn, a potential blueprint for nascent punitive damages classes of the future.