Administrative law and corporate governance

Learning Targets

Case: Food and Drug Administration v. Brown and Williamson Tobacco, 529 U.S. 120

The case above is more focused on administrative law, the scope of authority of a governmental agency, than the legal precedent regarding smoking. If the U.S. Congress repeatedly denies a lawful agency the power to develop and/or regulate a specific item under the agency's prevue, the agency then is disempowered to fulfill its franchise. In this case, the FDA attempted to regulate tobacco products and the tobacco companies challenged the regulations. Ultimately, the Supreme Court affirmed that the FDA did not have the legal power to enact and enforce the regulations in question. In effect, this hobbles the reason for, and judgment of, those governmentally empowered agencies.

Part 1) What regulations adopted by the FDA are challenged in this case? The FDA's authority to regulate tobacco came under the Food, Drug, and Cosmetic Act of 1938. This act gave the FDA the authority to oversee the safety of food, drugs and cosmetics designed to protect the general public. The FDA argued that the nicotine inherent in cigarettes was a drug and that cigarettes and smokeless tobacco are "devices" that deliver nicotine into the human body.

Part 2) Describe the dilemma that the Court discusses regarding its role of determining an agency's authority and deferring to the finding of that agency. The Court faced two major dilemmas in its review of this case. First, the precedent set by congress demonstrated that since 1965, Congress has enacted several statutes address the problems associated with tobacco use. By insisting on labeling and health warnings, Congress has, in effect, taken on the regulation of how the product (cigarettes) may be marketed and distributed to the public. Second, a careful review of the FDCA shows that Congress intended to exclude tobacco products from the FDA's jurisdiction. The FDCA specifically charges that a product must fit a certain criteria to be either regulated or banned under the law. Cigarettes do not fit that category. Regardless of the volatility and public opinion of the issue, the legality of Congress assigning authority to agencies or to regulate certain substances is part of a legal tradition, not to be extended by the Court when it is clear Congress shaped another disposition of that law.

Part 3) What does the Court conclude in the case and why? The Court concluded that the FDA did not, under the current set of legal standards, have the power to enact and enforce the regulations and could not "regulate" tobacco. The Court had the legal responsibility, under a previous precedent Chevron USA v Natural Resources Defense Council (467 U.S. 837), whether Congress had already spoken to the issue at hand., and if so, must give deference to Congress' decision. In this case, Congress had, under several occasions, spoken to the rule of law, and therefore, the Court could not expand or contract said authority.

Part 4) if regulation of tobacco is to occur, what has to happen first? Two things, which have actually happened. 1) Congress must rule that tobacco products are drugs and that the FDA may regulate drugs, and 2) Congress must expressly grant the DFA the power to regulate the tobacco industry. This they did under the Family Smoking Prevention and Tobacco Control Act (HR 1256), which was summarily signed into law on June 22, 2009. In addition to some packaging and marketing issues, the law was in direct response to the Brown and Williamson case, and now officially authorized the FDA with an oversight role on tobacco products.