This Week in Regulation

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The CFS sues the USDA for its failure to comply with food labeling law, the ACLU sues the Trump Administration over transgender ban, and more….

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IN THE NEWS

  • The Center for Food Safety (CFS) filed a lawsuit against the U.S. Department of Agriculture (USDA) for its failure to comply with the 2016 federal law on the labeling of genetically engineered food. The law required USDA to establish federal standards for labeling which included a study on “electronic and digital disclosures,” as opposed to on-package text, with an opportunity for public comment by July 2017; however, CFS alleged that “USDA has failed to finish and publicly release the study by the statutory deadline” and “to hold public comment on the study by the statutory deadline.”
  • The American Civil Liberties Union (ACLU) filed a lawsuit against President Donald Trump, U.S. Secretary of Defense James Mattis and the heads of the major branches of the military over President Trump’s decision to ban transgender individuals from serving in the military and to discontinue military funding for gender reassignment surgeries. President Trump justified the ban, which was initially announced via tweet in July but formally directed in a presidential memorandum last week, by saying there was no “sufficient basis to conclude that” allowing transgender individuals to serve “would not hinder military effectiveness and lethality, disrupt unit cohesion, or tax military resources.” The ACLU complaint stated that “transgender members face immediate and irreparable harm as a result of the Transgender Service Member Ban” and “extraordinary stress, uncertainty, and stigma.” The ACLU asked the court to proclaim the ban invalid and prevent it from coming into effect.
  • Environmental and tribal groups sued U.S. Department of the Interior Secretary Ryan Zinke over the U.S. Fish and Wildlife Service’s (FWS) rule “to designate the grizzly bears occupying the area in and around Yellowstone National Park a ‘distinct population segment’ and remove that population from the list of threatened species under the Endangered Species Act.” The lawsuit stated that the grizzly bear is “culturally and spiritually important” to the Northern Cheyenne Tribe and that FWS did not account for shrinking numbers in the bears’ population as well as food supply. The environmental and tribal groups claimed that FWS, in issuing the rule, violated procedures required by the Endangered Species Act and the Administrative Procedure Act.
  • The U.S. Food and Drug Administration (FDA) issued a warning letter to the U.S. Stem Cell Clinic for allegedly selling unsterile stem cell treatments. FDA Commissioner Scott Gottlieb said the warning letter was issued as FDA “takes new steps to advance an efficient, modern approach to the regulation of cell based regenerative medicine.” In response to the warning letter, U.S. Stem Cell argued that the company “is not violating the law as it is currently written.”
  • Neomi Rao, the Office of Information and Regulatory Affairs Administrator, sent a memorandum to the U.S. Equal Employment Opportunity Commission (EEOC) indefinitely suspending the compliance date for a requirement that businesses report to the EEOC employee compensation along with demographic information such as race, gender, and ethnicity. Rao explained that the continued collection of this information is “contrary to the standards of the Paperwork Reduction Act” and some aspects of the collection of information “lack practical utility, are unnecessarily burdensome, and do not adequately address privacy and confidentiality issues.”
  • The U.S. Environmental Protection Agency (EPA) and the U.S. Department of the Army scheduled ten teleconferences with companies and groups that have an interest in the definition of “Waters of the United States.” These meetings, which start on September 19 and will take place weekly for most of this fall, constitute the second step in carrying out Executive Order 13,778, which directs EPA and the Army Corps of Engineers to conduct a review of the definition. The first step involved a proposed rule earlier this summer, which sought to “re-codify the definition of ‘waters of the United States’” by bringing back “regulations that existed before the 2015 Clean Water Rule.”
  • Google reportedly submitted a proposal to the European Union (EU) outlining how it will change its shopping service to comply with an antitrust order. In June, EU regulators fined Google €2.4 billion ($2.7 billion) over charges that it violated antitrust rules by giving priority placement to its own shopping service. The EU ordered Google to stop this practice by September 28 of this year.
  • Judge Colleen Kollar-Kotelly of the U.S. District for the District of Columbia reportedly called the Presidential Advisory Commission on Election Integrity’s decision to release only a brief agenda prior to a meeting “incredible” and ordered the Commission to meet more robust transparency requirements ahead of its next meeting. An attorney from the Department of Justice reportedly called the Commission’s failure to disclose documents “an honest misunderstanding.”
  • The Department of Education issued a call for comments in accordance with Executive Order 13,777 to identify possible regulations related to postsecondary education that may be outdated, ineffective, or excessively burdensome. The Department announced it will hold 2 public hearings “at which interested parties may provide input.”

WHAT WE’RE READING THIS WEEK

  • In a recently released paper, Robert W. Hahn, a professor at the Smith School at the University of Oxford, and Andrea Renda, Senior Research Fellow at the Centre for European Policy Studies, reviewed procedural requirements for the removal of existing regulations prior to the implementation of new ones. The researchers found that such polices are typically implemented by politically conservative coalitions in an attempt to reduce costs associated with regulation. However, the authors concluded that such policies do not lead to increased economic efficiency.
  • In light of Hurricane Harvey’s devastation, Ella Nilsen offered in an article for Vox.com “five things to know about” Brock Long, Administrator of the Federal Emergency Management Agency (FEMA). Nilsen highlighted Long’s robust experience in emergency management positions but noted FEMA’s deficiencies, including the fact that the U.S. Department of Homeland Security, which manages FEMA, lacks a Secretary and that the Trump Administration intends to reduce FEMA’s budget.
  • In a forthcoming paper in the Vanderbilt Law Review, William J. Magnuson, Associate Professor of Law at Texas A&M University School of Law, discussed how the financial crisis of 2008 led to “dramatic changes” in the regulation of finance and how this regulation has “failed to take into account the rise of financial technology (or ‘fintech’) firms” and the changes that have accompanied this rise. Magnuson argued that “regulators’ focus on preventing the risks associated with ‘too big to fail’ institutions overlooks the conceptually distinct risks associated with small, decentralized financial markets” and provided “regulatory responses that better correspond to fintech’s particular risks and rewards.”