The Volokh Conspiracy - Is the Supreme Court Anti-Business?

A year ago commentators regularly claimed that the Roberts Court was a "pro-business" court. This year's two preemption decisions, Altria v. Good and (in particular) Wyeth v. Levine, have caused some to reconsider. Michael Greve of the American Enterprise Institute goes even farther, arguing the Wyeth decision is positively disastrous for business and reflects a poor understanding of federalism. In an essay posted today on NRO, "Preemption Strike," Greve rips the Court for extending "an open invitation to juries, state officials, and tort lawyers to help themselves to even more of the diminishing proceeds of America's productive economy." As Greve notes, federal preemption litigation is "asymmetric." Business wins when it can hold its ground, but losses risk unleashing floods of new litigation, so one big loss can overshadow a string of victories.

Greve is particularly critical of Justice Thomas' rejection of implied preemption:

"If Congress wants to preempt, let it say so clearly," rings the refrain. Justice Thomas's opinion is the most extreme expression of that position to date. Yet its obtuseness borders on willful denial. The states have every incentive and myriad ways to circumvent federal law. Because Congress cannot possibly foresee those stratagems, it cannot "clearly" preempt them. For example, the clearest federal preemption provision of all prohibits states from administering "a law or regulation related to fuel economy standards." California's proposed greenhouse-gas standards do not simply "relate to" fuel economy; they are fuel-economy standards. Even so, federal courts have upheld them against preemption challenges because California describes them as emission standards instead. . . .

The Stevens and Thomas opinions in Wyeth teem with encomia to "federalism" and the need to protect states against federal overreach. The court, they say, should not favor Congress by implying preemption. But the federalism analysis is a fantasy, and the protestations of neutrality are false.

Federal usurpation? Never in our history have the states wielded comparable power, and comparably destructive power, over the commerce of the United States. What "federalism" has come to mean, evidently, is the states' right to exploit the same branch of interstate commerce 50 times over. That absurdity is but a facet of a broader problem — the proliferation of fragmented, semi-autonomous, faction-ridden agencies and entities, from multi-state attorney-general "investigations" to local juries, all of which exercise public power without coordination or effective control. Implied preemption is, or was, one of the very few checks on that tendency.

The court's evisceration of that check is not an act of judicial neutrality; it is an abject surrender of constitutional responsibility. We are experiencing a malignant form of institutional competition — a three-branch, 50-state race for first prize in the gratuitous destruction of American business and industry. After Wyeth, the Supreme Court is leading by a nose.

	[Jonathan Adler, March 23, 2009 at 11:39pm] Trackbacks Is the Supreme Court Anti-Business? A year ago commentators regularly claimed that the Roberts Court was a "pro-business" court. This year's two preemption decisions, Altria v. Good and (in particular) Wyeth v. Levine, have caused some to reconsider. Michael Greve of the American Enterprise Institute goes even farther, arguing the Wyeth decision is positively disastrous for business and reflects a poor understanding of federalism. In an essay posted today on NRO, "Preemption Strike," Greve rips the Court for extending "an open invitation to juries, state officials, and tort lawyers to help themselves to even more of the diminishing proceeds of America's productive economy." As Greve notes, federal preemption litigation is "asymmetric." Business wins when it can hold its ground, but losses risk unleashing floods of new litigation, so one big loss can overshadow a string of victories. Greve is particularly critical of Justice Thomas' rejection of implied preemption: "If Congress wants to preempt, let it say so clearly," rings the refrain. Justice Thomas's opinion is the most extreme expression of that position to date. Yet its obtuseness borders on willful denial. The states have every incentive and myriad ways to circumvent federal law. Because Congress cannot possibly foresee those stratagems, it cannot "clearly" preempt them. For example, the clearest federal preemption provision of all prohibits states from administering "a law or regulation related to fuel economy standards." California's proposed greenhouse-gas standards do not simply "relate to" fuel economy; they are fuel-economy standards. Even so, federal courts have upheld them against preemption challenges because California describes them as emission standards instead. . . . The Stevens and Thomas opinions in Wyeth teem with encomia to "federalism" and the need to protect states against federal overreach. The court, they say, should not favor Congress by implying preemption. But the federalism analysis is a fantasy, and the protestations of neutrality are false. Federal usurpation? Never in our history have the states wielded comparable power, and comparably destructive power, over the commerce of the United States. What "federalism" has come to mean, evidently, is the states' right to exploit the same branch of interstate commerce 50 times over. That absurdity is but a facet of a broader problem — the proliferation of fragmented, semi-autonomous, faction-ridden agencies and entities, from multi-state attorney-general "investigations" to local juries, all of which exercise public power without coordination or effective control. Implied preemption is, or was, one of the very few checks on that tendency. The court's evisceration of that check is not an act of judicial neutrality; it is an abject surrender of constitutional responsibility. We are experiencing a malignant form of institutional competition — a three-branch, 50-state race for first prize in the gratuitous destruction of American business and industry. After Wyeth, the Supreme Court is leading by a nose.