The EPA Significant New Use Rule (“SNUR”): More Bureaucracy or Real Change?

The U.S. EPA recently promulgated a Significant New Use Rule (“SNUR”) under the Toxic Substances Control Act (TSCA). The SNUR would require companies to notify EPA prior to newly manufacturing, importing, or processing certain perfluorinated chemicals commonly used in carpet treatment and manufacture.  See Christopher L. Bell, Environmental Protection Agency(“EPA”) Promulgates Significant New Use Rule for Perfluorinated Chemicals – And Limits Its Applicability to “Articles,” Greenberg Traurig, LLP, The National Law Review, October 29, 2013. 

The newly promulgated SNUR is different from prior TSCA rules issued by EPA because it focuses on certain articles containing the chemicals, whereas in the pasts EPA was only concerned with the chemicals themselves. Id.  The proposed SNUR was broader in its effect on all articles that contain the perfluorinated chemicals.  The final rule was narrower in scope, affecting only identified articles, namely carpets and carpet pieces. Id.  Perhaps comments submitted by affected industries and others during the comment period on the proposed rule provided information or reasons for EPA to narrow the scope of the rule. 

Hopefully, this rule does not simply have the effect of creating more paper-work for industry.  It will remain to see what practical affect this SNUR or other newly promulgated SNURs will have on the ultimate goal of chemical safety in the United States. 

-- Contributed by Ashley Ivanov

CAN CONGRESSIONAL GRIDLOCK BE RESOLVED THROUGH MEDIATION?

The American Bar Association Section of Dispute Resolution announced the winner of the 2013 Boskey Dispute Resolution Essay competition. Sarah Gonski, a Harvard Law student, won the competition with her essay entitled “Easing Gridlock in the United States Congress Through Mediation: Letting Our Cities and States Teach Us Lessons On Getting Along.” 

The essay suggests that Congressional gridlock can be reduced by following the lead of several states and local governments by using mediators to mediate policy and legislative discussions, similar to the Negotiated Rulemaking Act (often called reg neg). Reg Neg was enacted to to encourage agencies to use negotiated rulemaking when it enhances the informal rulemaking process. (5 U.S.C § 561). 

The idea behind reg neg was set out in 1982 by Phillip Harter, an administrative law expert who developed the reg neg idea in a law review article, proposing negotiation as a means of alleviating the "malaise" that hindered the existing federal rulemaking process. See Harter, Philip J., Negotiating Regulations: A Cure for Malaise, Georgetown Law Journal, vol. 71, 1982 

Ms. Gonski’s essay sets forth some examples of successful uses of mediated legislative and policy negotiations by states and cities and the short and sad history of the few attempts to get Congress to establish a mediation office in Congress. She suggests that because of the institutional barriers in establishing a new agency, the Federal Mediation and Conciliation Service (FMCS), an existing federal agency that already provides mediation services in labor and employment disputes, could serve as home for legislative mediation.

I was directly involved in developing the legislation that authorizes FMCS to mediate reg neg and other federal sector policy issues by adding language to insure that the FMCS was specifically authorized to assist agencies by furnishing conveners, facilitators, and training in negotiated rulemaking. (See the Negotiated Rulemaking Act of 1990, reauthorized in 1996 and incorporated into the Administrative Procedure Act at 5 U.S.C. §§ 568 (b)). 

The need for mediation on the Hill is obvious. Gridlock is not good for anyone. 

While many issues will remain gridlocked because elections are the only way to resolve major public questions such as our budget priorities, not all legislation pending on the Hill is subject to those political pressures. If the appropriate stakeholders are involved in the negotiations over regulatory and other substantive issues, if the significant stakeholders on all sides of an issue can agree, then Members of Congress will not block the legislation. 

This would allow for Congress to actually conduct much of the business of the public, while, if they wish, continue to play their electoral/political games on the large (mostly budget-related) issues. 

Mediation on the Hill will not solve all issues and certainly will not eliminate the split between red and blue partisans. However, placing legislative/policy mediators in the FMCS and authorizing them to mediate legislative issues for Congress could result in better, less partisan legislation. 

This is a worthwhile goal.

Fourth Circuit Affirms Ashley District Court Decision

In a much anticipated decision, the United States Court of Appeals for the 4^th Circuit finally issued a decision in the PCS Nitrogen v Ashley II of Charleston, 2013 U.S. App. LEXIS 6815 (4^th Cir. 4/4/13) case.

The decision, however, did not provide the clarity that many were hoping for about the controversial decision by the District Court that the purchaser of the property, Ashley II of Charleston, did not qualify as a Bona Fide Prospective Purchaser (BFPP) and receive exemption from liability because it had indemnified a responsible party and, therefore, had an improper “affiliation” with that party.   

Larry Schnapf’s always illuminating blog, Business Environmental Law and Transactional Support, has a full discussion of the ruling and many of the other issues in the case here.

I served as a mediator for the parties to assist them in resolving the allocation issues and settle the case before litigation. I will not comment about the many issues in the case or the 4^th Circuit decision – except to point out that, given the “much ado about nothing” results, as Larry described the decision, the parties could have resolved the case without litigation. Instead, no party “won” much and all parties lost something.

Certainly the cost of litigation could have funded some if not all of the costs of a negotiated settlement. 

Abraham Lincoln and the Team of Rivals; Compassion, Wisdom and Peacemaking

While the Golden Globes may not have honored the genius of Stephen Spielberg’s direction of the movie Lincoln, I hope and believe the Oscar voters will.  As anyone who has a feel for history will, I think, agree, Lincoln is a uniquely moving portrait of Abraham Lincoln and the late part of the Civil War. 

Much of Spielberg’s movie is based on Team of Rivals: The Political Genius of Abraham Lincoln, the wonderfully researched and written book by Doris Kearns Goodwin.

For those who have not read it, Goodwin tells the story of “Lincoln’s political genius revealed through his extraordinary array of personal qualities that enabled him to form friendships with men who had previously opposed him, to repair injured feelings that, left unattended, might have escalated into permanent hostility; to assume responsibility for the failures of subordinates, to share credit with ease; and to learn from mistakes.” 

  

The movie makes the people and politics of the lame duck Congress in late 1864 and early 1865 understandable to viewers of today.  Before watching the movie I had doubts that the director and Daniel Day-Lewis, the actor who plays Lincoln, could make this iconic figure into a living, breathing human being. There is no doubt they succeeded.

The movie shows how Abraham Lincoln was different from other leaders, then and now. Goodwin writes that his “decency, morality, kindness, sensitivity, compassion, honesty and empathy” were “impressive political resources.” Lincoln may have said : “I destroy my enemies when I make them my friends.” We saw him doing that in this movie.

Abraham Lincoln was a lawyer – apparent in the movie – and that was a critically important part of his career; it helped shape who he was. He was famously quoted as advising attorneys to “Discourage litigation. Persuade your neighbors to compromise whenever you can.  As a peacemaker the lawyer has superior opportunity of being a good man. There will still be business enough.”

Lincoln was a good man and a peacemaker both before and during the Civil War, and his wisdom, compassion and humanity were central to his greatness. 

Federal Agencies Told to Use ADR Techniques to Resolve Environmental Issues

Federal agencies have yet again been directed to use Alternative Dispute Resolution (ADR) techniques to resolve disputes.  This time the Acting Director of the Office of Management and Budget and the Chair of the Council on Environmental Quality have directed relevant departments and agencies to

“increase the appropriate and effective use of third-party assisted environmental collaboration as well as environmental conflict resolution to resolve problems and conflicts that arise in the context of environmental, public lands, or natural resources issues, including matters related to energy, transportation, and water and land management. See Memorandum on Environmental Conflict Resolution.

Of course this is not the first time the White House has encouraged the use of ADR techniques in the federal government. For example, in 1998 President Clinton ordered agencies and departments to take steps to promote greater use of ADR techniques to resolve disputes and to negotiate regulations See Memorandum for Heads of Executive Department and Agencies

The memo sets out the use of ADR techniques to address environmental matters and directs federal agencies to use neutral facilitation to settle conflicts in issues related to energy, transportation and water and land management issues.

The memo applies to all executive branch agencies with regard to each agency’s enabling legislation, the National Environmental Policy Act (NEPA) and other laws aimed at managing and conserving the environment, natural resources and public lands. The complete memo is here.

Information about other relevant federal environmental ADR resources can be found at the Department of Justice web site the Department of Interior Office of Collaborative Action and Dispute Resolution web site and the EPA Conflict Prevention and Resolution Center site.

Wayne State Law School Environmental Law Clinic Director Gaining Recognition

Nick Schroeck is executive director of the Great Lakes Environmental Law Center and teaches at the Wayne State University Law School Environmental Law Clinic.  A 2007 graduate of Wayne State University law school, Nick is receiving recognition for his many accomplishments in environmental law.  Good for Nick and good for Wayne State Law School, my alma mater.

Nick has worked on a wide range of environmental issues and often appears in the media to help educate the public about environmental issues.  He has been involved in many of the recent environmental law issues in the Great Lakes area.

Nick often appears in the media speaking about high profile issues such as how to keep Asian carp out of the Great Lakes and hydraulic fracturing.  Good to see Wayne State Law School taking a leadership role in the public discourse about the environment. 

Maryland Court of Appeals Adopts New Rules Changing Title 17 – Alternative Dispute Resolution

On Nov. 1, 2012 the Court of Appeals of Maryland adopted a rules order including changes to Title 17, governing the provision of Alternative Dispute Resolution (ADR) services in all court ordered cases in Maryland. 

In addition, the rules order changed Title 9  Family Law, including how ADR services are provided by the Maryland courts in family cases.

The rules will go into effect on January 1, 2013. The full text of a PDF file of the rules order is here. 

Title 17 begins on page 55 and Title 9 begins on page 44 of the document.  The ADR Section of the Maryland State Bar Association played a significant role in shaping much of Title 17. Anyone providing ADR services to the Circuit Courts of Maryland should be sure to review the new rule.   

Delaware Chancery Court Appeals Decision Striking Arbitration Program

I recently blogged about Delaware statute that allows Chancery Court judges to sit as private arbitrators having been found to be unconstitutional by U.S. District Court Judge Mary McLaughlin of the District of Delaware.

As the DealBook blog in the New York Times wrote, the statute was designed to “permit the Delaware Chancery Court to arbitrate private disputes confidentially without public access.” Which seems to me to be the problem with the program.

As expected, the case has been appealed to the 3^rd Circuit. The lack of transparency in this arbitration program is a significant obstacle for the appellant to overcome.  What do you think are the odds of the District Court’s decision being overturned?

To read an article that disagrees with the District Court decision and supports the private arbitration program, click here. 

Citizens United? Evaluating the 2012 Presidential Election in a "Super PAC" World

The 2012 presidential election has been the most expensive to date. The whopping $2 billion that has been spent by both campaigns can be partially attributed to the Citizens United v. the Federal Election Commission decision by the Supreme Court.

This decision, as many of you know, held that corporations and labor unions have a First Amendment right to make independent expenditures that advocate election or defeat of candidates in certain federal elections.

This has led to the creation of “Super-PACs” that can spend an unlimited about of money in federal elections. This has led to a very large increase in paid media advertising. Many believe our campaign finance system is broken.

The American Bar Association Section on Individual Rights and Responsibility is holding a panel discussion to consider the effects of Citizens United on the 2012 presidential election.  Free-speech proponents, proponents of campaign donation regulation and election law practitioners will meet to discuss the lessons learned from this election and how campaign finance has changed.  The legal ramifications of Citizens United, such as the potential effects of shareholder litigation challenging campaign expenditures, will also be discussed.

Campaign finance is a critical issue. This panel is a timely opportunity for those in the DC area to hear civil discourse about an interesting subject. It is free, unless you are requesting CLE credit, in which case it costs $25.

To register for CLE credit, email the Section at irr@americanbar.org.  For more information, contact Patrice Payne at (202) 662-1030.

This is the Kind of Person I’d Hire as My Attorney

Like many of you, I read a lot of blogs, some of which are even worth reading and fewer of which might even be true.

I recently read a blog that says it all about our modern life, the practice of law, being a parent and human values. Think about this when you are sweating your practice:

“Hey, Dad, you’ve got a pretty good job.” “Why’s that, Jere?” “Because it’s air-conditioned, and you can get a root beer whenever you want one.” [Think about that the next time you're sitting in your office cursing a colleague, opposing counsel, a client or a judge: "It's air-conditioned, and I can get a root beer whenever I want one."]

The blog is written by Mark Herrmann, Vice President and Chief Counsel for Litigation at Aon, a risk management, insurance and reinsurance brokerage and human capital and management consulting firm. Herrmann is the author of The Curmudgeon’s Guide to Practicing Law which, while I haven’t read yet, intend on doing so simply because of the title.

Herrmann’s blog, Inside Straight: Things My Son Said is funny and oh so very true.

I commend it to your attention. Read it here.

Is Delaware’s Court Arbitration System for Business Disputes Unconstitutional?

Delaware, the state with laws designed for businesses, has a statute authorizing the Delaware Chancery Court judges – sitting Court judges – to conduct confidential arbitrations of business disputes.

The law, Arbitration Proceedings for Business Disputes provides that the “Court of Chancery shall have the power to arbitrate business disputes when the parties request a member of the Court of Chancery, or such other person as may be authorized under rules of the Court, to arbitrate a dispute.” (77 Del. Laws, c. 8 §1).

The Delaware Supreme Court has adopted rules governing the arbitration program. The rules provide that arbitrators are sitting Court judges or masters. Further, and the subject of controversy and now litigation, the Rules provide that all proceedings of the arbitration are confidential unless the proceedings are appealed.

There are at least two things wrong with this picture. First, why are these Court proceedings (even if labeled arbitration) confidential? Is this not private law? And second, why is an arbitration award appealable? Is this not evidence that the so-called arbitration proceeding is simply litigation in the Chancery Court – before Chancery Court judges and using the Court’s case management system by another name – to allow parties to cloak their dispute with the one of the benefits of private arbitration – confidentiality?

Recently the Delaware Coalition for Open Government as sued the five judges on the Delaware Chancery Court for operating a private arbitration system. The only difference between civil litigation - which is public - and the arbitration is that the "procedures and rulings occur behind closed doors instead of in open court," according to the complaint filed in Delaware's federal district court. The Coalition argues that the arbitration proceedings violate the right of access to judicial proceedings and records in civil and criminal cases guaranteed by 1st Amendment to the Constitution as applied to the states in the 14th Amendment.

The case is Delaware Coalition for Open Government Inc v The Honorable Leo E Strine Jr et al, U.S. District Court, District of Delaware, No. 11-1015.

This case is more fully discussed in the always interesting ADR Prof Blog by Professor Art Hinshaw. Professor Hindshaw points out that many courts manage arbitration programs; most typically occur in open court without confidentiality protection and the loser can appeal or ask the trial court for a trial de-novo.

"If the parties really want to go to arbitration, why not go to the private market?"