Rules issued by Bush administration limit consumer lawsuits

? Faced with an unfriendly Congress, the Bush administration has found another, quieter way to make it more difficult for consumers to sue businesses over faulty products. It’s rewriting the bureaucratic rulebook.

Lawsuit limits have been included in 51 rules proposed or adopted since 2005 by agency bureaucrats governing just about everything Americans use: drugs, cars, railroads, medical devices and food.

Decried by consumer advocates and embraced by industry, the agencies’ use of the government’s rule-making authority represents the administration’s final act in a long-standing drive to shield companies from lawsuits.

President Bush has campaigned for lawsuit reform since his days as Texas governor. As president, he has made little headway on the issue in Congress. He’s been thwarted by Democrats every time he’s tried to tackle the issue head-on.

Turns out there was another way, one little-noticed step at a time.

If the rulemaking at the various agencies had been a centralized effort in the White House or the Justice Department, “it would have failed because immediately everybody would have mobilized resistance,” said Michael Greve of the American Enterprise Institute, a conservative Washington think tank.

Limits on lawsuits have been ordered or proposed for drug labeling and packaging – one issue that will get a big airing today, because of a case involving actor Dennis Quaid’s newborn twins – and for rules ranging from mattress flammability standards to school bus passenger seating to dietary sweeteners and roof-crush requirements in car rollovers.

Of the 51 regulations, 41 came from the Food and Drug Administration and the National Highway Traffic Safety Administration, or NHTSA.

Ten of 15 federal traffic safety regulations from last year have been finalized by NHTSA and are now in force or soon will be, a development that has gotten minimal public attention.

Underlying this bureaucratic version of lawsuit reform is the concept of federal pre-emption – a legal idea that is hard to build widespread public interest in.

Rooted in the Supremacy Clause of the Constitution, federal pre-emption refers to circumstances in which federal law and regulation trump state law, in this instance state laws that govern when one person may be held liable for another’s injury.

Frequently filed in state courts, where juries often are more receptive to plaintiffs’ claims against corporations, product liability lawsuits are often moved at the request of business defendants to more restrictive federal courts.

Regardless of where the suits end up, the issue is increasingly about whether companies can use broad pre-emption language in regulatory preambles to get cases thrown out.

The preambles are the agencies’ interpretation of whether the federal regulatory law permits pre-emption of lawsuits. An expansive interpretation of pre-emption leaves little room for consumers to sue, and that is what the national trial lawyers group, the American Association for Justice, says is taking place.

Jon Haber, AAJ’s chief executive officer, says the agencies are engaging in “a brazen end run around Congress, the Constitution and the states in an effort to let negligent corporations off the hook and knowingly put consumers at risk.”

The real-world impact of pre-emption will be on display today when a congressional committee hears from actor Dennis Quaid and his wife, who have sued a maker of the blood-thinner heparin in Illinois state court.

The Quaids sued after their newborn twins were given massive doses of the blood thinner at a hospital. The Quaids claim the manufacturer was negligent in packaging different doses of the product in similar vials with blue backgrounds.

The company – Baxter Healthcare Corp. – is seeking to use the doctrine of preemption to shield it from any civil liability, claiming that once FDA approved the labeling and packaging at issue in the case, the company is immune from civil suits for money damages.