Op/Ed: Regulating Consumers, Aiding Industry

Wednesday, March 8, 2006

By Laurie Gindin Beacham and Amy Widman
A man commits suicide while taking Zoloft. There are indications that Pfizer, the drug’s manufacturer, might have known of a link between the drug and suicidal tendencies.  A lawsuit ensues.  The Food and Drug Administration (FDA) intervenes in the suit on behalf of—Pfizer?
Why is a federal agency defending drug companies against injured consumers—the very people they are supposed to protect?  Unfortunately, this is not surprising given the current administration’s bias toward industry over public safety.
Most Americans think of federal regulatory agencies like the FDA as watchdogs over public safety, believing they set safety standards for corporations. And that used to be the case. But the current administration is deliberately giving federal administrative agencies increasing power to promote decreasing regulation.
Along with the agencies’ role in regulating safety, it has historically been acknowledged that these agencies don’t always get it right—that sometimes their standards are not stringent enough or do not anticipate certain circumstances. So, where regulatory standards have fallen short, the civil justice system has stepped in.  Injured citizens can go to court to hold corporations accountable when they’ve been harmed by unsafe products, even though these products may have met the minimum regulatory standard. For example, Ford has repeatedly been found negligent for designing roofs that cave in too easily in their Explorers, despite meeting (apparently inadequate) roof safety standards set by the National Highway Traffic Safety Administration (NHTSA).
What’s happening now, however, is a dangerous confluence of two related factors: agencies are regulating industries less vigorously while eroding the ability of the civil justice system to protect citizens from unsafe products created by those industries. Under the Bush administration, agencies unduly influenced by industry are using their power to preempt—or override—state laws, including liability or “tort” laws that protect the public health and safety, which have always been regulated by the states. The methods vary. Sometimes agencies claim that their safety standards are the final word and, therefore, that no tort claims should be allowed in state courts.  Sometimes an agency intervenes in a lawsuit on behalf of a corporate defendant, such as Pfizer, claiming that if its own standards have been met, the case should be thrown out. Whatever the approach, the result is a serious compromise of public safety and an assault on people’s rights to have their cases heard by a jury.
Agencies are supposed to protect the public by regulating their respective industries. While they derive their authority to regulate from Congress, their leaders, in many cases, are appointed by the president.  It is now widely known that many agencies have been seized by the very industries they are supposed to regulate, led by a revolving door of industry figureheads. For example, Jeffrey A. Rosen, general counsel for the Department of Transportation, is a former attorney for General Motors Corp. Erika Jones, former general counsel for NHTSA, now represents the auto industry. Daniel Troy, Chief Counsel at the FDA from 2001 to 2004, had a previous career representing pharmaceutical and tobacco companies in cases against the agency. In fact, it was soon after Troy’s appointment that the FDA began interceding in lawsuits on behalf of corporate defendants.  The result is agencies that protect industry from liability rather than protecting the public from negligent industry. This is more than cronyism; it is industry regulating itself.
In January 2006, the FDA, after years of lawsuit interventions on behalf of corporate defendants, took the extraordinary next step of issuing drug-labeling rules and stating that state law claims are barred when those rules are met. The FDA presumes to know best when it comes to regulating drugs and, therefore, courts (specifically juries) should not be allowed to second-guess the agency. This was done without public notice or comment, behind closed doors after consultation with the drug industry. It is particularly troubling in light of the FDA’s recent failure to successfully regulate anti-depressants like Paxil and Zoloft, dietary herbs like ephedra, and most recently, the arthritis drug Vioxx.
Under the guise of creating stricter roof strength requirements, National Highway Traffic Safety Administration has proposed rules that would override state liability laws.  So long as NHTSA standards are met, no matter how weak or obsolete a car manufacturer’s roof standards may be, the rules would bar those injured in rollover crashes from legal recourse. This, despite the fact that, although most automakers already meet NHTSA’s roof standards, consumers are still at great risk in rollovers.
In another example, the Federal Communications Commission (FCC) attempted to intervene in a group of class action lawsuits by consumers against wireless companies over cell phone radiation emissions. The government argued that the FCC standards should override state law claims about the safety of cell phone technology.
Just last month—over objections from several consumer groups—the Consumer Product Safety Commission approved a rule seeking to preclude consumers from holding mattress manufacturers accountable for easily flammable mattresses, if CPSC standards are met.  Again, existing data on loss of life and property due to mattress fires has been ignored, and the proposal is not being presented for public review.
With regulatory agencies controlled by industries and headed by people biased against regulation, it is only liability that provides manufacturers, chemical companies, auto-makers, drug companies and other industries with an incentive to create safer products.  Litigation not only results in numerous dangerous products and practices being made safer or removed from the marketplace, but also allows attorneys to unearth important information and exposes these dangers to the general public. While so-called “tort reform” laws have already significantly eroded the legal rights of citizens to bring reckless corporations to court, “preemption” takes it a step further. The sector of the federal government charged with regulating industry is itself doing what big corporations have been trying to do through legislation for the last three decades: eliminating the right of injured people to sue and collect compensation from those responsible.
So far, courts have resisted accepting preemption arguments made by agencies intervening in lawsuits.  It is yet to be seen how courts will respond to the newly promulgated agency preemption “rules,” though it is clear that the Bush administration is intent on appointing pro-industry judges. The collusion between industry and “safety” agencies is leading this country into a world where using prescription drugs, driving your car, and making cell phone calls require blind faith in corporate decision-making.  This is a proven health risk.
Laurie Beacham and Amy Widman serve as communications director and attorney/policy analyst, respectively, for the Center for Justice & Democracy.


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