Briefly Legal

The Constitutional Basis for Federal Tort Reform in Health Care

The House Energy and Commerce Committee this morning is marking up H.R. 5, the Help Efficient, Accessible, Low-cost, Timely Healthcare (HEALTH) Act of 2011, legislation to control the unnecessary or excessive litigation costs that afflict health care in the United States. (Committee video. Hearing started at 10:41 a.m.)

In a timely and important contribution to the debate, the American Tort Reform Association has released a new paper,”The Constitutional Foundation for Federal Medical liability Reform.” In a news release, ATRA explained:

The ATRA paper, The Constitutional Foundation for Federal Medical liability Reform, addresses in some detail questions recently raised about whether provisions of H.R. 5 are consistent with the Commerce Clause, the Tenth Amendment, the guarantees of equal protection and due process, and the right to a jury trial.

“Citing more than 100 years’ worth of Supreme Court precedent, the consistent rejection of federal constitutional challenges to state medical liability reforms, and the opinion of the Congressional Research Service itself,” Joyce said, “our paper puts an end to any serious concern or question about the constitutionality of federal medical liability reform.

“With respect to perhaps the most important question about whether the Commerce Clause gives Congress sufficient authority to promulgate medical liability reform for the nation as a whole, it’s not even a close call. Congress has that authority.

Author of the paper is Mark A. Behrens of Shook, Hardy & Bacon L.L.P., a man who knows his civil liability issues. The National Association of Manufacturers has worked with Behrens and the law firm on numerous occasions over product liability litigation and related issues.

UPDATE (10:45 a.m.): Very timely report. Rep. Tammy Baldwin (D-WI) is making a “states rights” argument against the bill, proposing an amendment. She’s always been such a strong advocate for federalism.

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On NLRB, Boeing and Competitiveness: News Conference Video

From the office of Sen. Lindsey Graham (R-SC) comes the video of Tuesday’s news conference on the National Labor Relations Board’s complaint against Boeing. Hosted by the U.S. Chamber of Commerce, the event featured Gov. Nikki Haley (R-SC) as the first official to speak.

Her central point: President Obama must speak up on the issue.

We are demanding that the President respond to what the NLRB has done, because this goes against everything we know our American economy to be. When a company comes to South Carolina and wants to create jobs, they should be able to do that. For the President not to weigh in on this, and not to say that this is going to be harmful, is a problem.

Job creation is key in the next few years in this country. What we are doing is we are telling people, not only can you not go and work in any other state, we want you to go overseas.

That’s what the president is saying through his silence. He has got to speak up. We need to see leadership. He has to respond to what has happened from the NLRB to Boeing, and tell us, if we can’t create jobs this way, then how exactly are we supposed to create jobs.

The White House press corps has certainly had the time to pose the question to Jay Carney. Maybe today.

UPDATE [11:05 p.m.]: President Obama tapes a townhall discussion on the economy today at the Newseum, an appearance for CBS News. What a perfect opportunity to address the NLRB and Boeing issues. Now, back to news conference …

Joe Trauger of the National Association of Manufacturers speaks shortly after the 21 minute mark.

In other developments and commentary … (continue reading…)

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Boeing’s CEO McNerney on the NLRB’s Complaint, U.S. Competitiveness

Jim McNerney, president and CEO of The Boeing Company, refutes the complaint against the company by the National Labor Relations Board in an op-ed to be published in Wednesday’s Wall Street Journal. The column, “Boeing Is Pro-Growth, Not Anti-Union,” also delineates the threat that the NLRB’s unprecedented complaint represents to U.S. competitiveness. Excerpt:

The NLRB is wrong and has far overreached its authority. Its action is a fundamental assault on the capitalist principles that have sustained America’s competitiveness since it became the world’s largest economy nearly 140 years ago. We’ve made a rational, legal business decision about the allocation of our capital and the placement of new work within the U.S. We’re confident the federal courts will reject the claim, but only after a significant and unnecessary expense to taxpayers.

More worrisome, though, are the potential implications of such brazen regulatory activism on the U.S. manufacturing base and long-term job creation. The NLRB’s overreach could accelerate the overseas flight of good, middle-class American jobs.

See also Boeing’s “final answer” filed in response to the  (available here) to the NLRB’s complaint and the company’s letter last week rebutting assertions made by the NLRB’s acting general counsel, Lafe Solomon.

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Gov. Haley: Let’s Hear from President Obama on Boeing, NLRB

South Carolina Gov. Nikki Haley was in Washington today to draw national attention to the National Labor Relations Board’s unjustified and unprecedented complaint against The Boeing Company for locating new production facilities in South Carolina instead of unionized Washington State.

“We’ve got to make sure that we are responding to this in a strong way,” the Republican governor said at a news conference hosted by the U.S. Chamber of Commerce. “We have to do it in a loud way and the president owes it to the state of South Carolina and every state in the country on what he’s going to do in reference to what the NLRB has done against Boeing. While Boeing may be the first company, you know, I don’t think this will be the last company.”

Haley was joined by Sens. Lindsey Graham (R-SC), Jim DeMint (R-SC), Lamar Alexander (R-TN) and Rand Paul (R-KY), Rep. Joe Wilson (R-SC), and South Carolina’s Attorney General Alan Wilson.

Gov. Nikki Haley speaks to NAM's Joe Trauger

Business was also well represented with leaders from the Chamber, Business Roundtable, HR Policy Association, and the National Association of Manufacturers, all cited in the joint news release issued by the Chamber, “Business Leaders, Governor, Members of Congress Express Serious Concern with NLRB Complaint Against Boeing.” (To say the least.) The NAM’s Joe Trauger, vice president for human resources policy, said:

Manufacturers are alarmed by the recent action of the NLRB and the dangerous new precedent being set. This action is effectively a ban on companies from expanding in right-to-work states if they now have production facilities in a state with union representation. Companies are deeply concerned about the impact this complaint will have on their operations and ability to create jobs. The NLRB is reversing 45 years of its own precedent and calling into question companies’ fundamental business decisions on where to expand or whom to hire.

News coverage …

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President Draws a Royal (Judicial) Flush on Health Care Lawsuit

The three U.S. Appellate Court judges who today heard the federal government’s appeal of the decision by U.S. District Court Judge Henry Hudson of Virginia on the constitutionality of the individual mandate in the health care law, were all appointed by Democratic Presidents. In fact, two of three judges — all selected at random — were appointed by President Obama himself.

Why is this important? So far all the rulings made on the constitutionality of the new health care law – 12 in all – have correlated directly to which party’s president – Republican or Democrat – appointed them. The three-judge panel is effectively a royal flush because the Fourth Circuit is comprised of Republican appointees by a ratio of nearly 3-to-1. While not a certainty, it appears likely Hudson’s ruling will be overturned and appealed to the Supreme Court by the Commonwealth of Virginia from a losing position.

Joe Trauger is vice president for human resources policy at the National Association of Manufacturers.

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NLRB Already Talking About ‘Settlement’ in Boeing Case

Yes, elected officials, business groups and the public are continuing to speak out against the National Labor Relation Board’s unprecedented and extreme complaint against The Boeing Company, even though NLRB’s acting general counsel, Lafe Solomon, issued a statement Monday trying to silence the storm of criticism against the board.

Solomon’s statement also signaled the NLRB’s lack of confidence in the merits of its case.

The Associated Press reports, “Gov. Haley heads to Washington for Boeing battle“:

COLUMBIA (WACH, AP)- Governor Nikki Haley, members of Congress, U.S. Chamber of Commerce officials and business association leaders will hold a press conference on Tuesday in Washington, D.C.to discuss concerns relating to the National Labor Relations Board complaint against the Boeing Company.

Joe Trauger, vice president for human resource policy for the National Association of Manufacturers, will participate in the 11:30 a.m. event. Other speakers from the business side are Business Roundtable President John Engler; the Chamber’s Randy Johnson, senior vice president of labor, immigration, and employee benefits; and Dan Yager, chief policy officer and general counsel at HR Policy Association.

In his statement Monday, Solomon urged “all interested parties [to] respect the legal process, rather than trying to litigate this case in the media and public arena.” The NAM’s Trauger already pointed out the arrogance represented by a government official like Solomon attempting to silence criticism after all he and the NLRB have done to promote their arguments “in the media and public arena.”

Solomon’s statement is interesting for another reason, his invocation of the word “settlement.”

It is important to note that the issuance of a complaint is just the beginning of a legal process, which now moves to a hearing before an administrative law judge. That hearing, scheduled for June 14 in Seattle, is the appropriate time and place to argue the merits of the complaint. The judge’s decision can further be appealed to the Board, and ultimately to the federal courts. At any point in this process, the parties could reach a settlement agreement and we remain willing to participate in any such discussions at the request of either or both parties.

Such a prominent appeal to “settlement” is highly unusual, perhaps unprecedented, knowledgeable observers tell us.

We read the statement to be Solomon acknowledging the weakness of the NLRB’s complaint against Boeing, which he filed at the behest of the International Association of Machinists and Aerospace Workers. This is the equivalent of a prosecutor saying, “We are confident in the strength of our case, but you know, there’s a judge, and it’s kind of hard, and maybe we’ll reach a deal or the charges might be dropped, because … A settlement would be really, really good, we think.”

Better idea: The NLRB should resist the political pressure from the labor unions and the Obama Administration and just withdraw the complaint, apologize and move on.

Recent Shopfloor.org posts:

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NLRB’s General Counsel: Don’t Question Us About Boeing

Acting General Counsel Lafe Solomon of the National Labor Relations Board today released a statement asserting there is “nothing remarkable or unprecedented about the complaint issued against Boeing Company on April 20.”

Perhaps telling businesses where they can expand and chilling future capital investment is unremarkable to the Acting General Counsel, but it is certainly unprecedented.  The release of such a defensive statement by Mr. Solomon on an active case raises the question of whether the NLRB is starting to doubt the merits of its complaint.

While admonishing others who have raised questions or concerns about the complaint against “litigating this case in the public arena” the Acting General Counsel conveniently leaves out the news releases, “fact checks,” tweets and other materials issued by his office on this matter.  Are businesses and their associations supposed to sit down and shut up while an appointed board injects itself into fundamental business decisions about where to locate and whom to hire? Should the government be allowed to expend taxpayer dollars to damage a company’s reputation and force it to seek legal recourse without question?

Solomon probably just wants to avoid pointed inquiries about the NLRB’s preposterous complaint and the message it sends to other industries operating in the United States.

And in fact, he is scheduled to speak Tuesday in Chicago at a chapter meeting of the Labor and Employment Relations Association. The topic? “Recent Developments at the National Labor Relations Board (NLRB),” promoted on an association flyer with, “Both the National Labor Relations Board and the Board’s General Counsel have implemented numerous changes in federal labor law, encompassing a wide range of procedural and substantive areas. Please join the NLRB’s Acting General Counsel, Lafe Solomon, for a presentation and discussion regarding recent developments at the Board.”

But no questions about Boeing, please. (continue reading…)

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Sunshine in Litigation Act Threatens Dark Day for Business, Justice

UPDATE (May 12, 11:54 a.m.): The Senate Judiciary Committee did not act on this measure today, postponing consideration for another week.

____________

The Senate Judiciary Committee on Thursday is scheduled to vote on  S.623, the Sunshine in Litigation Act, to force open sealed settlement agreements and documents closed under a judge’s order if the documents have an impact on public safety or health. Long promoted by trial lawyers, the bill would dramatically raise the costs of litigation and give the plaintiffs’ bar another weapon to pressure the businesses into out-of-court settlements.

The National Association of Manufacturers and other members of the  Coalition to Protect Privacy, Property, Confidentiality, and Efficiency in the Courts sent a letter to the Judiciary Committee last week explaining business’ vigorous opposition to the proposal. Excerpt:

[The] bill would severely restrict existing judicial discretion to protect the privacy, property, and confidentiality of all litigants by requiring federal judges to make premature decisions about the masses of information produced in modern civil litigation.

Ultimately, S. 623 would increase the costs and burdens associated with civil litigation while stifling the federal court system. Finally, the bill would confer unfair tactical advantages on certain litigants at the expense of others.

Protective and sealing orders are invaluable litigation tools. These orders help ensure the confidentiality of valuable information produced in discovery. Severe restrictions on their availability would have a chilling effect not only on discovery and settlements but also on the commencement and defense of claims. (continue reading…)

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Boeing Complaint: Hatch Challenges Appointment, Authority of NLRB’s General Counsel

President Obama skirted federal law and established procedures to appoint Lafe Solomon to serve as Acting General Counsel of the National Labor Relations Board, Sen. Orrin Hatch (R-UT) charged this week, calling on the President to withdraw Solomon’s appointment in the wake of the NLRB’s unjustified and economically disastrous complaint against The Boeing Company.

Hatch took to the Senate floor Thursday to dissect and denounce the NLRB’s complaint against Boeing for locating new assembly facilities in South Carolina instead of Washington State.  In a lengthy statement (available here), the Utah Republican analyzed the NLRB’s contravention of federal law labor, warned of the competitive consequences of bureaucrats making facility-siting decisions, and criticized the Obama Administration for putting the interests of organized labor before the nation’s.

NLRB's Lafe Solomon

Hatch also challenged the validity of President Obama’s June 21, 2010, appointment of Solomon to serve as Acting General Counsel, arguing that the President ignored the established procedures for such appointments under the National Labor Relations Act (NLRA). Instead, Hatch said, the President made Solomon his personal acting general counsel under “the more generous terms” of the Federal Vacancies Act, which is intended to apply to government vacancies in general.

Why did the President take this unusual step? Hatch:

Under the Vacancies Act, Mr. Solomon is allowed to stay in the job in an acting capacity, without Senate approval, for an initial 210 days—rather than the 40 days provided under the National Labor Relations Act—and then be reappointed again for another 210 days, and a third time for yet another 210 days, until the end of President Obama’s term.

This is yet another example of the President end running the law in order to ensconce in office individuals who would have a difficult time surviving the constitutionally required confirmation process—a process that ensures the people and their representatives have some meaningful oversight of the appointee.

Solomon filed the NLRB complaint against Boeing on April 20, acting in support of the International Association of Machinists and Aerospace Workers, which represents workers at Boeing’s Washington facilities. Given the timing cited by Sen. Hatch above, Solomon’s appointment as Acting General Counsel should have expired on July 31, 2010, depriving Solomon of the authority to take the later action against the airplane manufacturer.

Hatch’s analysis carries extra weight because of the Senator’s status as a senior member on both the Senate Health, Education, Labor, and Pensions Committee – which oversees the National Labor Relations Act — and the Senate Judiciary Committee. In challenging Solomon’s authority, the Senator also reinforces an argument made by Boeing in its defense.

Boeing’s formal response to the NLRB filed on May 4 challenges Solomon’s status, the 14th and final item in the list of the company’s defenses: “The Complaint is ultra vires because the Acting General Counsel of the NLRBdid not lawfully hold the office of Acting General Counsel at the time he directed that the Complaint be filed.” Ultra vires means outside of one’s authority. (continue reading…)

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Pressure Mounts Over ‘Preposterous’ NLRB Complaint Against Boeing

McClatchy Newspapers reports on the Republican presidential debate in Greenville, S.C., “South Carolina’s Haley leaves mark on GOP presidential debate“:

With so few candidates at the debate, [Gov. Nikki]  Haley played a supporting role as the Fox News moderators took up her challenge to presidential candidates to weigh in on a National Labor Relations Board complaint against Boeing Charleston’s plant.

Pawlenty jumped first, claiming President Barack Obama’s administration crossed a new line in opposing Boeing’s decision to locate outside of its home base of Washington. “It’s a preposterous decision,” he said.

Minnesota Public Radio, “Pawlenty scores some points in first GOP debate“:

On the domestic front, Pawlenty drew wild applause from the audience when he stood with South Carolinians over a local labor issue involving Boeing aircraft jobs.

“You have this administration, through the National Labor Relations Board, telling a private company that they cannot relocate to South Carolina and provide jobs in this state. And they are good-paying jobs, and they’re needed jobs. It’s a preposterous decision and position of this administration.”

It’s not just a local labor issue. It’s a national issue of tremendous importance to businesses across the nation, who are deeply concerned about a National Labor Relations Board that arrogates to itself the power to determine where a company can locate new production facilities.

And although the Republicans have seized on the issue while Democrats, tied to organized labor, have remained mostly silent, this is also not inherently a partisan issue. The idea that a government agency can reinterpret precedent and ignore the facts of a case to shut down a billion-dollar operation employing more than 1,000 people should alarm those of all political affiliations who believe in private-sector growth.

The NLRB’s account of the facts of the case is suspect. Chairman John Kline (R-MN) and Rep. Phil Roe (R-TN) of the House Education and Workforce Committee has sent a letter (available here) to Lafe Solomon, the NLRB’s acting general counsel who brought the complaint against Boeing.

The complaint references alleged statements made by Boeing officials between October 2009 and March 2010 that work stoppages were one reason for choosing the new location.

When asked about the charge in June 2010, the NLRB regional director Richard Ahearn told The Seattle Times “it would have been an easier case for the union to argue if Boeing had moved existing work from Everett, rather than placing new work in Charleston.” He was also unable to point to any “bright line” rule to determine whether the company’s actions violated the law. Finally, the regional director stated “an initial ruling is weeks away.”

The letter requests NLRB documents underlying the decision. Bloomberg reports, “Republicans Rally Behind Boeing Over Labor Board Complaint.”

On the Senate side, Sen. Jim DeMint (R-SC) and 18 other Senate Republicans have written President Obama calling on him to withdraw the nomination of Solomon — the NLRB’s general counsel job requires Senate confirmation — and NLRB member Craig Becker, the former SEIU lawyer who serves on the board via a recess appointment. From FoxNews.com, “Senate Republicans Threaten to Fight NLRB Nominations Over Boeing Complaint“: (continue reading…)

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