The Federalism Project

American Enterprise Institute

Monday, June 12, 2000

Collision Court
The Upcoming Clash Between Federalism and Pre-emption Is Foretold in the Geier v. American Honda Opinions

by Michael Greve

Last month, manufacturers--and their shareholders, customers, and insurers--escaped the imposition of massive liabilities by the skin of their teeth. Corporate defendants won a narrow 5-4 victory when the Supreme Court found federal pre-emption of state tort law in Geier v. American Honda Motor Co.

But behind the May 22 decision lurks a large problem: Pre-emption law is on a collision course with the conservative justices' celebrated project to re-establish structural constitutional principles on federalism.

Despite a powerful dissent by Justice John Paul Stevens, who emphasized that Geier "is a case about federalism" and the "constitutional role of the States as sovereign entities," the majority opinion sidesteps those considerations. It neither mentions the word federalism nor cites a single federalism case.

Such compartmentalization cannot long survive the thrust of the Rehnquist Court's own constitutional campaign. Notwithstanding Geier, corporate defendants in future pre-emption cases will face a difficult task.

Reaching to Pre-Empt

Geier presented a plaintiff who alleged that Honda's failure to equip her 1987 Accord with an air bag rendered the car defective and its manufacture negligent and liable for the crash injuries she subsequently suffered. In an opinion written by Justice Stephen Breyer, a bare 5-4 majority ruled that the state lawsuit was pre-empted by a federal safety standard.

Federal Safety Standard 208 required car manufacturers to install driver-side air bags in an increasing portion of their new fleet over several model years (including 1987). The secretary of transportation explained that a gradual introduction, as opposed to an immediate all-air-bags requirement, would enhance overall passenger safety by increasing consumer acceptance and by enabling manufacturers and regulators to learn about the effectiveness of air bags and competing technologies. The Geier majority determined that product liability suits predicated on a duty to install air bags would have frustrated this policy and were therefore pre-empted by it. Such suits would have forced manufacturers to install air bags in all vehicles, thus "actually conflict[ing]" with the federal government's gradualist program.

The pre-emption finding is (to put it mildly) not immediately apparent from the statute under which the standard was implemented--the National Traffic and Motor Vehicle Safety Act of 1966. The act explicitly pre-empts "any safety standard" that varies from the federal standard. However, the saving clause of the act provides that compliance with federal standards "does not exempt any person from any liability under common law." The natural way to reconcile these provisions is to say that "standards" means regulatory or legislative standards, while liability suits under state common law (like Geier) fall under the saving clause.

Predictably, the plaintiff and the amici state governments advanced an interpretation along these lines. Their arguments are reflected in Justice Stevens' dissent, which dresses the position in full federalist regalia and extols tort remedies as part of "the States' historic police powers."

Now, the dissent borders on the disingenuous: In the Court's string of constitutional federalism cases, Stevens has consistently derided, as unworkable or worse, the Court's efforts to defend traditional state powers against congressional incursions. And product liability law is the worst possible area in which to rediscover one's affection for states' rights.

In its modern version, product liability law serves state attorneys general and plaintiffs lawyers to lay entire industries to waste. The asserted state prerogative is the systematic transfer of wealth from out-of-state defendants to in-state plaintiffs and their lawyers. If federal commerce clause pre-emption deserves a nod on any issue, it is to bar the uninhibited pursuit of beggar-thy-neighbor policies.

Even so, the Geier majority's construction of an "actual conflict" between common law and federal policy is strained and artificial. Pending liability suits cannot truly conflict with a phase-in that ended more than a decade ago. More broadly, Justice Stevens is correct in suggesting that the majority's creativity stands in jarring contrast--if not in actual conflict--with its constitutional federalism decisions and especially its commerce clause cases.

Imaginative Nexus

Modern pre-emption law reflects the sensibilities of Wickard v. Filburn, the famous (or notorious) 1942 decision that extended congressional authority under the commerce clause to the regulation of wheat grown for home consumption. Much as Wickard presumes that national legislation, to be effective, must be all-encompassing, so post-New Deal pre-emption doctrines say that congressional enactments should be presumed to wipe out all state and local laws that might frustrate their objectives--even when those subordinate laws do not actually conflict. (A residual respect for the states gives rise to another presumption--diluted to the vanishing point in Geier--against finding pre-emption without a clear, manifest indication of congressional intent.)

While the Court is not about to overrule Wickard, its modern commerce clause cases--United States v. Lopez (1995) and United States v. Morrison, decided only days before Geier--show that the Court is no longer willing to credit, never mind presume or supply sua sponte, an imaginative nexus between local activities and interstate commerce. Blanket assertions of national purposes--gun control in Lopez, prevention of gender-based violence in Morrison--no longer suffice to extend federal commerce regulation. Why, then, should they continue to hold sway in pre-emption cases?

Federalism concerns become particularly pressing when pre-emption derives not directly from statutory language, but rather from an administrative agency's action under its delegated authority. Geier finds pre-emption not in the National Traffic and Motor Vehicle Safety Act nor even in the language of the air bag regulation. Rather, as Justice Stevens observes (and the majority does not dispute), the pre-emptive policy is cobbled together by the Court from the convoluted history of air bag and seat belt regulation, the likely effects of tort suits on the dispersion of air bag technology, inferences from the secretary's explanation accompanying the standard, and the federal government's litigation position.

To the Geier majority, this makes no difference. It avers, without explaining, that Geier-style suits conflict with the standard, "hence with the Act itself." Apropos of the dissent's suggestion that administrative pre-emption should require a specific, official indication of an intent to pre-empt, the majority responds that such a doctrine would "tolerate conflicts that an agency, and therefore Congress, is most unlikely to have intended." But why "therefore"? It cannot be right that any pre-emption authority an agency assumes under (often vague) statutory provisions should ipso facto be attributed to Congress.

Over to the Agency

This so-called delegation issue will gain prominence. On the day of the Geier decision, the Court granted certiorari in Browner v. American Trucking Associations. The justices will review a ruling by the U.S. Court of Appeals for the D.C. Circuit that the Clean Air Act's mandate requiring the Environmental Protection Agency to set air quality standards "requisite to protect the public health" with an "adequate margin of safety" constitutes an unconstitutional delegation of legislative power unless the EPA establishes an "intelligible principle" to guide the range of policy choices under the statute.

However the ATA case in particular turns out, the Court is bound to re-examine the precedents that treat administrative pre-emption as essentially unproblematic or, as in Geier, deserving of creative judicial supplementation. Arguably, an agency's interpretation of its authority vis--vis the states no more merits judicial deference than an agency's interpretation of its "horizontal" jurisdiction. As Justice Sandra Day O'Connor (joined by Chief Justice William Rehnquist and Justices Antonin Scalia and Clarence Thomas) mused in Medtronic v. Lohr (1996), "it is not certain that an agency regulation determining the pre-emptive effect of any federal statute is entitled to deference." Even short of this suggestion, heightened attention to the implications of delegated pre-emptive authority is sure to constrain that authority.

The attorneys who will argue the next pre-emption dispute may be looking at a case where every vote is in play. The liberal justices (Stevens, Breyer, David Souter, and Ruth Bader Ginsburg) fiercely oppose federalism in constitutional cases, where it tends to confine regulation. But they will often welcome federalism limits in pre-emption cases (as three did in Geier), where such limits will generally allow for more state regulation.

For their part, the five conservative justices cannot be relied on to insulate pre-emption from their broader federalist principles. Thomas did sign the dissent in Geier. While Rehnquist, O'Connor, Scalia, and Anthony Kennedy joined the majority opinion, one may safely assume that they did so with serious misgivings--and mindful of their larger project of rebuilding constitutional norms.

That project must proceed one case, one doctrine at a time. Its terrible difficulty is that a re-assertion of constitutional principle in one corner of the administrative state will often make room for a monstrosity in another. In Geier, the price (of releasing state tort law to run rampant) was too high. Sooner rather than later, though, the momentum of the Supreme Court's broader views on federalism, and perhaps nondelegation, will carry over into the pre-emption field.

One must admire the Court's constitutional vision--and hope that it will continue to show strategic sense to match.