The Regulatory Week in Review: September 2, 2016

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The Ninth Circuit dismisses allegations from the FTC, the Supreme Court declines to overturn the Fourth Circuit’s ruling on North Carolina’s voter ID law, and more…

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IN THE NEWS

  • The U.S. Court of Appeals for the Ninth Circuit dismissed allegations from the Federal Trade Commission (FTC), filed under the Federal Trade Commission Act, that AT&T failed to properly disclose “data throttling” to its customers—a practice where customers with unlimited data plans receive reduced data speeds if they exceed a certain usage threshold during a billing cycle. The Ninth Circuit noted that AT&T’s claim that its data throttling program was “necessary” to maintain its networks was undermined by the fact that throttling occurs “without regard to real-time network congestion,” but nonetheless held that AT&T was within the Act’s Section 5 “common carriers” exemption and therefore could not be regulated by the FTC.
  • The U.S. Department of Health and Human Services (HHS) announced new standards for Head Start—a federal program that provides services, including health services and early childhood education, to children of low-income families—the new standards will increase the amount of time children spend in Head Start, require that standardized evaluations of each child be completed by teachers, and are intended to bolster parental involvement in the program. In announcing the standards, Secretary of Health and Human Services Sylvia Burwell praised them as a way to “strengthen the program for decades to come.”
  • The Federal Aviation Administration (FAA) launched the exemption program tied to its recent rule on commercial drones—the rule allows for the routine commercial operation of drones provided that certain criteria, such as operation during the daytime and within the line of sight, are met. The exemption process was created after the drone industry expressed concern that the commercial drone rule’s criteria were too stringent and could result in the blockage of innovative new practices. The FAA has already granted more than 70 exemptions under the program, most of which allow for nighttime operation.
  • In a 3-0 decision, the U.S. Court of Appeals for the Ninth Circuit upheld a federal ban on the sale of guns to holders of medicinal marijuana cards. A Nevada woman, S. Rowan Wilson, challenged as unconstitutional provisions of the Gun Control Act (GCA), along with an “Open Letter” issued by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) that deemed an “unlawful user” to be anyone who “uses or is addicted to marijuana, regardless of whether his or her State has passed legislation authorizing marijuana use for medicinal purposes.” The Ninth Circuit found that the ban did not violate the Second Amendment, and further held that ATF had complied with the Administrative Procedure Act (APA) in issuing the Open Letter because it was “textbook interpretative” and was therefore “exempt from notice-and-comment procedures.”
  • The Equal Employment Opportunity Commission (EEOC) issued its final updated guidance on workplace retaliation—guidance that is intended to protect employees who file complaints under various employment discrimination laws from retaliation by their employers—among other changes, the EEOC responded to the U.S. Supreme Court’s 2009 decision in Crawford v. Marion by clarifying that protection from retaliation applies to employees who have expressed opposition to discriminatory practices in a variety of ways, not only those who make complaints that result in an EEOC investigation.
  • The Food and Drug Administration (FDA) announced a rule change regarding the labeling of opioid painkillers and benzodiazepines. Under the modified rule, the nearly 400 affected drugs will have to display warnings about the risks of using the two classes of drugs at the same time. Calling avoidable overdoses due to the combination of opioids and benzodiazepines a “public health crisis,” FDA Commissioner Robert Califf said he hoped “health care professionals [would] heed these new warnings” and be more careful when prescribing the two classes of drugs together.
  • The National Highway Traffic Safety Administration (NHTSA) and the Federal Motor Carrier Safety Administration (FMCSA) issued a proposed rule that would require all heavy-duty vehicles to be equipped with speed-limiting electronic devices. U.S. Transportation Secretary Anthony Foxx lauded the proposal, stating that it offers “significant safety benefits,” while the agencies predicted that the rule “would reduce the severity of crashes involving these vehicles and reduce the resulting fatalities and injuries,” and “would result in fuel savings and greenhouse gas (GHG) emissions reductions totaling of $848 million annually.”

WHAT WE’RE READING THIS WEEK

  • The U.S. Department of the Treasury (DoT) recently published a white paper addressing the issue of tax avoidance by large, multinational corporations. The paper addressed Treasury Department concerns with the European Commission’s approach to “curtail[ing] the erosion of our respective corporate tax bases,” and came after Treasury Secretary Jack Lew sent a letter to European Commission President Jean-Claude Juncker in February. In a statement accompanying the paper’s release, Robert B. Stack, Deputy Assistant Secretary for International Tax Affairs at the Treasury Department, noted that the United States is “concerned” that the European Commission’s approach could harm U.S. taxpayers, “undermine progress,” and “create an unfortunate international tax policy precedent.”
  • Writing for the American Action Forum, an organization for which he serves as Director of Regulatory Policy, Sam Batkins analyzed the rulemaking history of the Consumer Financial Protection Bureau (CFPB). Batkins highlighted the burdens imposed by CFPB rules—26 of the 49 rules finalized by the CFPB have imposed a combined $2.8 billion in costs—before turning to the median pace of CFPB rulemaking, which he found to be “3.5 times faster than that of significant executive agency actions.” In evaluating the CFPB’s rulemaking speed, Batkins expressed concern over the amount of notice the public receives for some rules, pointing to instances in which CFPB rules were finalized prior to publication in the Unified Agenda.
  • In an article published in the Review of Environmental Economics and Policy, Ted Gayer of the Brookings Institution and Professor W. Kip Viscusi of Vanderbilt Law School examined whether, when crafting regulations, U.S. policymakers “should assess the benefits of climate change policies from a domestic or global perspective.” They concluded that, based on existing statutory guidance, administrative requirements for regulatory analysis, and standard cost-benefit analysis practice, incorporating global benefits into the regulatory process would be a departure from current practice, and called for future researchers to develop better empirical calculations of the domestic benefits of climate change policies.