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The Costs of Clean Water in Hoosick Falls: Private Civil Litigation and the Regulation of Drinking Water Quality

Bronwen B. O’Herin

Despite extensive statutory law and regulations governing drinking water quality in the United States, water-contamination crises have been a regular feature of the American news cycle in recent years, perhaps most notably in Flint, Michigan, but also in a disturbing number of localities across the United States, including the upstate New York town of Hoosick Falls. This Note uses the water-contamination crisis in Hoosick Falls as a case study to analyze why these apparent regulatory failings continue to persist. This case study reveals how scientific uncertainty, resource constraints, and the socio-political dynamics of public regulation in the drinking-water context limit public ex ante regulatory mechanisms’ power to deter drinking-water contamination and to rebalance the equities disrupted when drinking-water pollution occurs. In Hoosick, private tort litigation has the potential to be a powerful vehicle for addressing such regulatory shortcomings, but its ability to do so will turn on whether courts are willing to be more flexible in their conceptions of legally cognizable harm. I argue that such flexible conceptions are justified and would serve a crucial dual purpose—bolstering pollution deterrence and providing a forum in which social costs not accounted for during the regulatory, industrial, and political processes that drive public-resource governance may, finally, be accounted for.

Regulation and Distribution

Richard L. Revesz

This Article tackles a question that has vexed the administrative state for the last half century: how to seriously take account of the distributional consequences of regulation. The academic literature has largely accepted the view that distributional concerns should be moved out of the regulatory domain and into Congress’s tax policy portfolio. In doing so, it has overlooked the fact that tax policy is ill suited to provide compensation for significant environmental, health, and safety harms. And the congressional gridlock that has bedeviled us for several decades makes this enterprise even more of a nonstarter.

The focus on negative distributional consequences has become particularly salient recently, playing a significant role in the 2016 presidential election and threatening important, socially beneficial regulatory measures. For example, on opposite sides of the political spectrum, environmental justice groups and coal miner interests have forcefully opposed the regulation of greenhouse gases through flexible regulatory tools in California and at the federal level, respectively.

The time has come to make distributional consequences a core concern of the regulatory state; otherwise, future socially beneficial regulations could well encounter significant roadblocks. The success of this enterprise requires significant institutional changes in the way in which distributional issues are handled within the executive branch. Every president from Ronald Reagan to Barack Obama has made cost-benefit analysis a key feature of the regulatory state as a result of the role played by the Office of Information and Regulatory Affairs, and the Trump administration has kept that structure in place. In contrast, executive orders addressing distributional concerns have languished because of the lack of a similar enforcement structure within the executive branch. This Article provides the blueprint for the establishment of a standing, broadly constituted interagency body charged with addressing serious negative consequences of regulatory measures on particular groups. Poor or minority communities already disproportionally burdened by environmental harms and communities that lose a significant portion of their employment base are paradigmatic candidates for such action.

Jurisdiction, Exhaustion of Administrative Remedies, and Constitutional Claims

Peter A. Devlin

The doctrine of exhaustion of administrative remedies says that a person challenging an agency decision must first pursue the agency’s available remedies before seeking judicial review. It was created by courts in order to promote an efficient justice system and autonomous administrative state. Congress has since written exhaustion requirements into many statutes to ensure and guide its application. Consequently, a court interpreting one of these statutory versions must first decide whether it is a jurisdictional rule or not. The fallout from this decision is the topic of this Note. By definition, jurisdictional rules are rigid: Courts may not create exceptions to them, parties may not waive or forfeit them, and they will loom over the proceedings from start to finish. Faced with a jurisdictional exhaustion requirement, courts have had to choose between diluting the concept of jurisdiction and allowing injustice. In this Note, I look for a way out of this tradeoff. I argue that statutory exhaustion requirements are neither jurisdictional nor non-jurisdictional rules, but rather mandatory rules with a particular set of effects on courts and parties. Courts, for example, may not apply equitable exceptions to statutory exhaustion requirements, but agencies may waive or forfeit them. I define this “mandatory” exhaustion by looking to case law, jurisdiction theory, constitutional structure, and the purposes of exhaustion. I also develop an exception for constitutional claims that arise outside of an agency’s proceedings. This exception helps avoid the threat to separation of powers that requiring exhaustion for such claims would create. As a result, if courts used mandatory exhaustion then they would be empowered to avoid injustice without creating a conceptual mess. Commentators have suggested that exhaustion requirements might be mandatory in nature, and the Second Circuit has treated them as such. But neither has provided much guidance on what that means. I try to fill in that gap by developing a descriptive and normative case for categorizing them as mandatory rules.

Holding the EPA Accountable: Judicial Construction of Environmental Citizen Suit Provisions

Katherine A. Rouse

What happens when a presidential administration fails or refuses to properly administer our nation’s environmental laws? Thanks to the design of our federal environmental statutes, American citizens are armed with a valuable legal tool to hold the Environmental Protection Agency (EPA) accountable: the citizen suit. Environmental citizen suits allow private citizens to sue the EPA to require it to carry out its statutory duties, and can be a valuable mechanism in the face of a presidential administration unsympathetic to environmental protection. Because citizen suit provisions allow citizens to sue the EPA Administrator for failing to perform an action or duty that is nondiscretionary under the statute, the permissibility of lawsuits frequently turns on judicial interpretation of the term “nondiscretionary duty.” There is currently a split across the federal courts as to how to construe this term. In fact, the case law on this topic has become somewhat muddled, with disparities arising among district courts and few courts of appeal ruling conclusively on the issue. Some courts have narrowed the term, thereby limiting opportunities for citizen suits. A primary disagreement is whether the presence of the word “shall” in a statutory provision is sufficient to impose a nondiscretionary duty or whether more is required. Some courts have determined that a duty is discretionary unless the provision also includes a “date-certain” deadline, requiring the Administrator to perform the prescribed action by a specific date that appears within that part of the statute. Other courts have resisted adopting a bright-line rule requiring a date-certain deadline before imposing a nondiscretionary duty on the Administrator. The Supreme Court has not spoken on this date-certain deadline rule. This Note will explore how courts have interpreted the term nondiscretionary duty in environmental citizen suit provisions. This Note argues that the federal judiciary as a whole should abandon the date-certain deadline rule and side with courts that construe nondiscretionary duty more broadly. This reading can be supported legally, and will ensure that citizens are able to sue to compel EPA action even when a presidential administration fails to carry out important environmental laws and regulations.

The Missing Structural Debate: Reforming Disclosure of Online Political Communications

Pichaya P. Winichakul

The Federal Election Commission (FEC), the nation’s campaign finance regulator, is charged with administering one of America’s fundamental anti-corruption measures: disclosure and disclaimer requirements for political communications. The FEC has come under attack for failing to enforce its disclosure laws against the Internet Research Agency, the Russian-based organization recently indicted for meddling in American elections through use of online political propaganda. Had the FEC properly enforced the disclosure laws, it could have armed the millions of Americans who viewed Internet Research Agency advertisements with critical information to take to the polls. Efforts to address this campaign finance failure have coalesced around the Honest Ads Act, a bill that proposes substantive changes to the campaign finance disclosure rules. This Note argues that the Honest Ads Act mischaracterizes the problem that led to the FEC’s regulatory failure, and offers another explanation: the structural problems that have led to agency inaction and capture. This Note explores FEC inaction and capture and begins to develop a legislative alternative to the Honest Ads Act.

Incentivizing Pharmaceutical Testing in an Age of Off-Label Promotion

Ryan Sila

In 2012, the Second Circuit held that under the First Amendment, pharmaceutical manufacturers have a right to promote their drugs for uses for which that they have neither been clinically tested nor FDA-approved. Weighing heavily in the Second Circuit’s analysis was the argument that the FDA’s prohibition on so-called “off-label speech” inhibited physicians’ access to complete information, thereby harming public health. That line of reasoning has also created skepticism within Congress of the FDA’s policy. Others argue that the prohibition on off-label speech is necessary in order to incentivize manufacturers to clinically test their drugs for all intended uses—a process that not only allows the FDA to certify the drug as safe and effective in each of its uses, but also creates a larger data set about a drug’s effects before it begins to be marketed and prescribed. If manufacturers can market their pharmaceutical products for unapproved uses, they have reduced incentives to seek FDA approval, especially because the required clinical tests are extremely costly. Whatever one believes about a policy of permitting off-label promotion, it is clear that it not only creates benefits, but it also creates costs. This Note considers regulatory and common-law tools to reduce those costs. It rejects available regulatory tools, because either they are too weak to change manufacturers’ incentives to conduct clinical tests, or they suffer from the same constitutional questions that troubled the Second Circuit. Instead, this Note argues that courts can hold manufacturers to a common-law duty to test their drugs for each use for which they market them, and it outlines what such a duty might entail. Such a solution, if properly implemented, would not only mitigate the concerns about the liberalization of off-label promotion, but it would also be supported by modern products liability doctrine.

The Unwarranted Regulatory Preemption of Predatory Lending Laws

Nicholas Bagley

In response to a perceived increase in the incidence of predatory lending, several states have recently enacted laws designed to protect vulnerable borrowers from abusive lenders. Earlier this year, however, the Office of the Comptroller of the Currency (OCC) determined that the new laws conflicted with the National Bank Act and issued a regulation preempting them. This Note argues that the OCC overstepped its congressionally delegated authority when it promulgated the regulation, and that courts should consequently invalidate it in order to allow states to continue to develop novel legislative responses to the growing problem of abusive lending. The Note proceeds in two stages. First, after canvassing the unsettled case law on the issue, it argues that courts should not categorically defer to agency decisions to preempt state laws. Because of the relative ease with which administrative agencies can preempt state laws and the real threat that preemption orders pose to state legislative independence, the judiciary should scrutinize agency preemption decisions to ensure that they are at the very least reasonable. Second, the Note turns to the substance of the OCC order, contending that it reflects an unwarranted, unnecessary, and unwise effort to meddle in states’ purely internal affairs. Because the predatory lending laws only minimally affect national bank lending powers, do not impose costs on the national banking system, and do not generate spillover effects, they do not interfere with national banks in a way that can justify the OCC’s wholesale preemption.

Terminal 250: Federal Regulation of Airline Overbooking

Elliott Blanchard

Every year, hundreds of thousands of passengers arrive at their local airport to discover that their flight is overbooked. Unbeknownst to most travelers, their damages for the airlines’ breach of contract are governed by federal regulation. Since 1978, 14 C.F.R § 250.5 has set a statutory cap of four hundred dollars for all passengers bumped from domestic flights. In this Note, Elliott Blanchard examines the effects of this provision on passenger and airline behavior by applying modern contract theory to the problem of airline overbooking. He begins by examining the economic forces that led airlines to overbook flights and the subsequent federal government regulatory response in the 1970s. He observes that while a uniform system of compensation for all passengers made sense during the period of airline regulation, increased heterogeneity in both carriers and passengers now make such a system inefficient. While the market for airline travel has changed dramatically since the end of regulation, the statutory ceiling on damages has remained constant. The author argues that this cap undercompensates passengers for breach by the airlines, and rewards the carriers that overbook aggressively. Given the information asymmetries regarding the likelihood of being bumped, airlines have the opportunity to exploit passengers who cannot accurately discount an airline’s probability of performance. As a solution, the author suggests a repeal of the maximum damage amount coupled with increased disclosure of airline overbooking rates, which would encourage airlines to compete on performance as well as price.

Towards a New Standard for First Amendment Review of Structural Media Regulation

Michael J. Burstein

The Supreme Court’s decisions in the Turner Broadcasting cases ushered in a new era of rigorous judicial oversight of regulations aimed at shaping the economic structure of the media industry. The Turner decisions, and especially their application by lower courts, have expanded the range of regulations subject to heightened First Amendment scrutiny, consistently granted lower levels of deference to legislative and administrative judgments, and applied a degree of economic scrutiny of regulatory choices unseen since the Lochner era. In this Note, Michael Burstein argues that such scrutiny is inappropriate in light of the quickening pace of technological and economic change that marks the modern information environment. He observes that the technological balkanization of First Amendment jurisprudence has outlived its usefulness and that applying a unitary standard to all activities of a particular type of media fails to focus judicial attention on the entity’s core speech activities. Instead, Burstein proposes that courts draw a distinction between regulations that impact content production or editorial choices and those which aim to structure the distribution of information. The former remain deserving of heightened scrutiny, but the latter implicate a long tradition of allowing government regulation to improve the information order. Because government necessarily must make choices among competing instrumental arrangements, none of which implicates a particular normative theory of the First Amendment, such choices are entitled to judicial deference. As technology blurs the lines between different media outlets, this framework should provide the needed flexibility to protect the First Amendment interests of both media entities and the public they serve.

Group Judgments: Statistical Means, Deliberation, and Information Markets

Cass R. Sunstein

How can groups elicit and aggregate the information held by their individual members? There are three possibilities. Groups might use the statistical mean of individual judgments; they might encourage deliberation; or they might use information markets. In both private and public institutions, deliberation is the standard way of proceeding; but for two reasons, deliberating groups often fail to make good decisions. First, the statements and acts of some group members convey relevant information, and that information often leads other people not to disclose what they know. Second, social pressures, imposed by some group members, often lead other group members to silence themselves because of fear of disapproval and associated harms. As a result, deliberation often produces a series of unfortunate results: the amplification of errors, hidden profiles, cascade effects, and group polarization. A variety of steps can be taken to ensure that deliberating groups obtain the information held by their members; restructuring private incentives, in a way that increases disclosure, is the place to start. Information markets have substantial advantages over group deliberation; such markets count among the most intriguing institutional innovations of the last quarter-century and should be used far more frequently than they now are. One advantage of information markets is that they tend to correct, rather than to amplify, the effects of individual errors. Another advantage is that they create powerful incentives to disclose, rather than to conceal, privately held information. Information markets thus provide the basis for a Hayekian critique of many current celebrations of political deliberation. They also provide a valuable heuristic for understanding how to make deliberation work better. These points bear on the discussion of normative issues, in which deliberation might also fail to improve group thinking, and in which identifiable reforms could produce better outcomes. Applications include the behavior of juries, multimember judicial panels, administrative agencies, and congressional committees; analogies, also involving information aggregation, include open source software, Internet “wikis,” and weblogs.

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