Public Right-to-Know Case Tops Judicial Agenda in 2001

04 December 2000 00:00  [Source: ICB Americas]

By Glenn Hess

Cases involving the standards for punitive damage awards and the right of the public to know how the government makes regulatory decisions are among the landmark issues that will be decided by federal courts next year, according to chemical industry officials.

"No matter how the courts rule on these and several other high-impact cases, they will have a profound effect on the way government, the courts and business operate," says Donald Evans, senior counsel of the American Chemistry Council (ACC).

At issue in the public right-to-know case, which is before the US Supreme Court (American Trucking Associations Inc. (ATA) vs. Browner), is whether federal regulatory agencies should calculate both the potential costs and benefits of environmental regulations.

"This case is about more than simply whether agencies, such as the EPA, should determine the costs and benefits of potential regulations," comments ACC counsel Alexandra Dunn. "It's about whether the public has a right to know and have access to the information the government uses to make its regulatory decisions."

In 1997, the US Environmental Protection Agency (EPA) imposed new standards for controlling ground-level ozone (smog) and particulate matter (soot). In both instances, the agency identified ranges of health risks of several alternative standards--one of which it eventually selected.

However, EPA did not specify what part of the Clean Air Act it used to justify its selection. Nor did the agency explain what environmental and health benefits might be expected from the changes.

The ACC joined ATA and other business groups in contesting EPA's decision. A lower federal court ruled last year that the agency exceeded the authority given to it by Congress in the way it went about selecting and imposing the new standard.

"Everyone--and especially the public--has a right to know how EPA and other federal agencies make decisions, how the science supports their choices," says Ms. Dunn.

She points out that opinion research recently conducted by the ACC showed the "public overwhelmingly supports the idea of expanding the concept of right-to-know to include the federal government."

Among other things, the research, conducted for ACC by Charlton Research Company of California, found that 89 percent of Americans believe the government should calculate what the costs and benefits of regulations are likely to be.

The punitive damage award case (Cooper Industries Inc. vs. Leatherman Tool Group) involves the question of what standard courts will apply in determining whether an award is constitutional. This case is also before the US Supreme Court.

The justices will decide which standard appellate courts should apply when they review awards. At issue is whether appellate courts should defer to the trial court--and reverse the lower court's decision only if it has abused its discretionary powers in setting the award--or whether the appellate court is free to make its own independent determination of whether the award is constitutional.

"If judges know their decisions will be reviewed under the less stringent 'abuse of discretion' standard, they are more likely to sustain an excessive award," Mr. Evans remarks. "On the other hand, if they know their decisions will be measured against the more stringent 'standard of review,' they are more likely to find more awards excessive and unconstitutional," he adds.

Another case before the federal bench deals with the issue of "causation." The US Ninth Circuit Court of Appeals is reviewing an earlier ruling it made (Kennedy vs. Southern California Edison Company) that significantly weakened traditional causation requirements.

The court's decision to review the case was prompted by the company's request for a rehearing and concerns voiced by the ACC and others about the potential impact of the decision. "The court's earlier ruling establishes a standard that is so weak, what the court called a 'negligible probability of harm,' that virtually any claim can prevail," says Mr. Evans.

At issue is what level of exposure to a hazardous substance was "more probable than not" to have caused a person's cancer. In the case, brought by a woman who was exposed to radiation while working at a nuclear power plant, the court determined that although the risk of cancer from the alleged exposure was no more than one in 100,000, it nevertheless was sufficient for a jury to find the defendant at fault.

According to the court's original ruling, "all the jury need have concluded...was that it was more probable than not that there was more than a negligible probability" that the defendant's cancer was caused by this level of exposure.

"The court's decision was a radical departure from law, which requires proof of actual cause," says Mr. Evans. "If a slight increase in risk equals legal cause, then legal cause means nothing."

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