BLTS 11e-IM-Ch32



Chapter 39Consumer and Environmental LawIntroductionMany federal and state administrative agencies are focused on what has become a vast area of government regulation—consumer protection. Consumer transactions broadly include transactions that involve an exchange of value for the purpose of acquiring goods, services, land, or credit for personal or family use. Federal and state laws protect consumers from unfair trade practices, unsafe products, discriminatory or unreasonable credit requirements, and other problems related to consumer transactions. This chapter focuses primarily on federal legislation.Fifty years ago, there were only a handful of statutes and regulations, plus old common law concepts, governing the environment. Regulation was initially aimed at cleaning up damage to the environment. At the end of the 1970s, there was a shift toward preventive regulation, on the theory that preventing injury to the environment is less expensive than cleaning up damage after it has occurred. Controlling waste is not without a price, however. For many businesses, the costs are high, and for some they are too high. There is a constant tension between the desirability of increasing profits and productivity and the need to attain quality in the environment. This chapter considers some of the major federal environmental laws.Chapter OutlineI.Advertising, Marketing, and SalesSources of consumer protection include federal and state laws, private organizations, and so on. Courts and other mechanisms (free legal services, small claims courts, recovery of attorneys’ fees in class actions, and others) encourage consumer action.A.Deceptive Advertising?Deceptive advertising is generally defined as advertising that may be interpreted as false or misleading.?Deceptive advertising occurs if a reasonable consumer would be misled by the ad. Puffery—vague generalities and obvious exaggerations—is permissible.1.Claims That Appear to Be Based on Factual EvidenceAds that appear to be based on factual evidence but in fact are not are deemed deceptive.Case Synopsis—Case 39.1: POM Wonderful, LLC v. Federal Trade CommissionPOM Wonderful, LLC makes and sells pomegranate-based products. In ads, POM touted medical studies claiming to show that daily consumption of its products could treat, prevent, or reduce the risk of heart disease, prostate cancer, and erectile dysfunction. These ads mischaracterized the scientific evidence. The Federal Trade Commission (FTC) charged POM with, and held POM liable for, making false, misleading, and unsubstantiated representations in violation of the FTC Act. POM was barred from running future ads asserting that its products treat or prevent any disease unless armed with “randomized, controlled, human clinical trials demonstrating statistically significant results.” POM appealed.The U.S. Court of Appeals for the District of Columbia Circuit affirmed. “An advertiser who makes express representations about the level of support for a particular claim must possess the level of proof claimed in the ad and must convey that information to consumers in a non-misleading way.”..................................................................................................................................................Notes and QuestionsIsn’t false information so transparent that there is no need for a government agency or court to intervene? Doesn’t the marketplace effectively weed out such deception? False information and ad claims may seem transparent to most of us, but many persons fall victim to such claims, no matter how false. Undoubtedly, products that do not do what is claimed on their behalf would eventually disappear from the marketplace, but without some form of policing, others would quickly take their place, and the truth would be more difficult to distinguish from the noisy barrage of lies.Additional Cases Addressing this Issue —Deceptive AdvertisingCases considering claims of deceptive advertising include the following.?Waldman v. New Chapter, Inc., 714 F.Supp.2d 398 (E.D.N.Y. 2010) (food product manufacturer's packaging was misleading, in that it gave false impression that consumers were buying more than they actually received, and purchaser alleged that, had she understood true amount of product, she would not have purchased it).?Buetow v. A.L.S. Enterprises, Inc., 713 F.Supp.2d 832 (D.Minn. 2010) (ads for carbon-embedded hunting clothing including statements such as “complete scent elimination,” “scentfree,” “works on 100% of your scent (100% of the time),” “all human scent,” “odor is eradicated,” and graphics showing that human odor cannot escape carbon-embedded fabric were literally false).?Lima v. Gateway, Inc., 710 F.Supp.2d 1000 (C.D.Cal. 2010) (allegations that computer monitor manufacturer stated monitor could attain a resolution of 2,560 by 1,600 pixels and provide “visually intense” gaming experience, but did not state an additional purchase was required to attain that resolution were sufficient to plead members of the public were likely to be deceived).?Transamerica Corp. v. Moniker Online Services, LLC, 672 F.Supp.2d 1353 (S.D.Fla. 2009) (service mark owner's allegations—that defendants used well-known service mark to lead consumers to Web sites offering services similar to those offered by mark owner, and that consumers believed they were accessing mark owner's services when they were not—fell under false and misleading ad statutes).?Smith v. William Wrigley Jr. Co., 663 F.Supp.2d 1336 (S.D.Fla. 2009) (consumer's allegations that chewing gum company advertised brand of gum as “scientifically proven to help kill the germs that cause bad breath,” that there was no scientific proof to substantiate the ad, that consumer bought the gum in reliance on the ad, and that the company charged a premium based on the ad, adequately stated a claim for unfair and deceptive trade practices).?Brewer v. Indymac Bank, 609 F.Supp.2d 1104 (E.D.Cal. 2009) (borrowers' allegation that lender's explanation of the adjustable rate mortgage offered to borrowers was intentionally misleading, deceptive, and ambiguous was sufficient to state claim for false advertising).2.Claims Based on Half-TruthsAds that appear to be based on factual evidence but in fact are not are deemed deceptive.3.Bait-and-Switch AdvertisingThis section highlights Federal Trade Commission (FTC) rules defining and prohibiting bait-and-switch advertising (refusing to show an advertised item, failing to have in stock a reasonable quantity of the item, failing to promise to deliver the advertised item within a reasonable time, or discouraging employees from selling the item).4.Online Deceptive AdvertisingThe FTC Advertising and Marketing on the Internet: Rules of the Road guidelines of 2000 describe how existing laws apply to online ads. Generally—?Ads must be truthful and not misleading).?Claims must be substantiated.?Ads must not be unfair (causing a substantial injury that a consumer cannot avoid and that is not outweighed by a benefit to consumers or competition.?Ads must disclose relevant limitations and qualifying information underlying claims?There must be “clear and conspicuous” disclosure of qualifying or limiting information. Burying this information on an internal Web page and linking to it is not recommended.5.Federal Trade Commission Actionsa.Formal ComplaintAn FTC action against those who are accused of deceptive advertising begins with an investigation, often after a consumer complaint. The investigation may lead to a formal complaint. If the alleged offender does not agree to settle, a hearing is held before an administrative law judge.b.FTC Orders and RemediesA cease-and-desist order, an order requiring counteradvertising, or a multiple-product order may be sought.c.Damages When Consumers Are InjuredThe FTC may seek restitution if an ad involves wrongful charges to consumers.B.False Advertising Claims under the Lanham ActUnder the Lanham Act, to state a successful claim, for false advertising a business must establish—?An injury to a commercial interest in reputation or sales.?Direct causation of the injury by false or deceptive advertising.?A loss of business from consumers or other buyers who were deceived by the advertising.Case Synopsis—Case 39.2: Lexmark International, Inc. v. Static Control Components, Inc.Lexmark International, Inc., sells the only style of toner cartridges that work with the company's laser printers. Other businesses—remanufacturers—acquire and refurbish used Lexmark cartridges to sell in competition with the cartridges sold by Lexmark. Static Control Components, Inc., makes and sells components for the remanufactured cartridges, including microchips that mimic the chips in Lexmark’s cartridges. Lexmark released ads that claimed Static Control’s microchips illegally infringed Lexmark’s patents. Lexmark then filed a suit in a federal district court against Static Control, alleging violations of intellectual property law. Static Control counterclaimed, alleging that Lexmark engaged in false advertising in violation of the Lanham Act. The court dismissed the counterclaim. On Static Control’s appeal, the U.S. Court of Appeals for the Sixth Circuit reversed the dismissal. Lexmark appealed.The United States Supreme Court affirmed the lower court’s ruling. The Supreme Court’s decision clarified that businesses do not need to be direct competitors to bring an action for false advertising under the act. A cause of action for false advertising under the Lanham Act extends to plaintiffs whose interests “fall within the zone of interests protected by the law.” To establish a claim, a plaintiff must allege an injury to a commercial interest in reputation or sales proximately caused by a violation of the statute. Static Control met this test...................................................................................................................................................Notes and QuestionsUnder the Court’s ruling in this case, is Static Control now entitled to relief? No—based on a careful reading of the Court’s ruling in this case, Static Control is not yet entitled to relief. To invoke the Lanham Act's cause of action for false advertising, a plaintiff must plead and prove an injury to a commercial interest in sales or business reputation proximately caused by the defendant's misrepresentations. In this case, the Court ruled that Static Control alleged an adequate basis to proceed in its counterclaim against Lexmark for false advertising under the Lanham Act. But Static Control cannot obtain relief without evidence of an injury proximately caused by Lexmark's alleged misrepresentations. The Court held here only that Static Control is entitled to a chance to prove its case, not that it has already proved it.Two rival carmakers purchase airbags for their cars from different third-party manufacturers. The first carmaker, hoping to divert sales from the second, falsely proclaims that the airbags used by the second carmaker are defective. Who among these parties can successfully allege proximate cause as part of a false advertising claim brought under the Lanham Act? Under these facts, both the second carmaker and its airbag supplier could suffer injury to their business reputations, and their sales could decline as a result. Each would be directly and independently harmed by the attack on its merchandise. Consequently, either or both of them could establish the element of proximate cause to support a claim for false advertising brought under the Lanham Act.C.Marketing1.Telephone SolicitationThe Telephone Consumer Protection Act (TCPA) of 1991 prohibits phone solicitation using an automatic phone dialing system or a prerecorded voice and the transmission of ads via fax without the recipient’s permission. Junk fax fines can be $11,000 per day.2.Fraudulent TelemarketingUnder the Telemarketing and Consumer Fraud and Abuse Prevention Act of 1994, the FTC issued the Telemarketing Sales Rule of 1995 to ban misrepresentation and requires disclosure by telemarketers, including foreign firms. The FTC also set up the national Do Not Call Registry.Enhancing Your Lecture—????Protecting U.S. Consumersfrom Cross-Border Telemarketers?????One of the problems that the Federal Trade Commission (FTC) faces in protecting consumers from scams is that those involved in the illegal operations frequently are located outside the United States. Nevertheless, the FTC has had some success in bringing cases under the Telemarketing Sales Rule (TSR) against telemarketers who violate the law from foreign locations. As discussed in the text, the TSR requires telemarketers to disclose all material facts about the goods or services being offered and prohibits the telemarketers from misrepresenting information. Significantly, the TSR applies to any offer made to consumers in the United States—even if the offer comes from a foreign firm.A Telemarketing Scam That Originated in CanadaOleg Oks and Aleksandr Oks, along with several other residents of Canada, set up a number of sham corporations in Ontario. Through these businesses, they placed unsolicited outbound telephone calls to consumers in the United States. The telemarketers offered pre-approved Visa or MasterCard credit cards to those consumers who agreed to permit their bank accounts to be electronically debited for an advance fee of $319.The telemarketers frequently promised that the consumers would receive other items—such as a cell phone, satellite dish system, vacation package, or home security system—at no additional cost. In fact, no consumers who paid the advance fee received either a credit card or any of the promised gifts. Instead, consumers received a “member benefits” package that included items such as a booklet on how to improve their creditworthiness or merchandise cards that could be used only to purchase goods from the catalogue provided.The Canadian Government and the FTCCooperate to Prosecute the TelemarketersThe FTC, working in conjunction with the U.S. Postal Service and various Canadian government and law enforcement agencies, conducted an investigation that lasted several years. Ultimately, in 2007 Oleg and Aleksandr Oks pleaded guilty in Canada to criminal charges for deceptive advertising. They were barred from telemarketing for ten years.aIn addition, the FTC filed a civil lawsuit against the Okses and other Canadian defendants in a federal court in Illinois. The court found that the defendants had violated the FTC Act and the TSR and ordered them to pay nearly $5 million in damages.bFor Critical AnalysisSuppose this scam had originated in a country that is not as cooperative as Canada is with the United States. In that situation, how would the FTC obtain sufficient evidence to prosecute the foreign telemarketers? Is the testimony of U.S. consumers regarding phone calls they receive sufficient proof? Why or why not?a. Oleg was also sentenced to a year in jail and two years’ probation.b. Federal Trade Commission v. Oks, ___ F.Supp.2d ___, 2007 WL 3307009 (N.D.Ill. 2007). The court entered its final judgment on March 18, 2008.D.Sales?States’ “cooling-off” laws permit a buyer to rescind a purchase within a certain period of time. The FTC has mandated notice to consumers of this right (in Spanish, if the sale was conducted in Spanish).?The FTC “Mail or Telephone Order Merchandise Rule” of 1993 covers sales in which orders are transmitted using computers, fax machines, or similar means over phone lines. The rule covers shipping, notice of delays, and refunds.II.Labeling and Packaging LawsLaws dealing with labels and packages require—?Accurate information about products.?Use of language easily understood by the ordinary consumer.?Disclosure of a product’s ingredients—such as cotton in a garment—in some instances.?Warnings of potential dangers in some instances.A.Automobile Fuel Economy LabelsThe Energy Policy and Conservation Act of 1975 requires automakers to include the Environmental Protection Agency’s fuel economy estimate on a label on every new car.B.Food LabelingLabels are required on, among other products, fresh meats, fruits, and vegetables to indicate where the food originated. The Fair Packaging and Labeling Act of 1966 requires that product labels identify—?The product.?The net quantity of contents; and the size of a serving if the number of servings is stated.?The manufacturer.?The packager or distributor.1.Nutritional ContentFood products must bear labels detailing nutrition, including how much and what type of fat a product contains. The U.S. Food and Drug Administration and the U.S. Department of Agriculture are the chief agencies that issue regulations on food labeling.2.Caloric Content of Restaurant FoodsUnder federal law, a restaurant chain with twenty or more locations must post the caloric content of the foods on its menu, including food offered through vending machines. Exempt are condiments, daily specials, and food offered for less than sixty days. Guidelines on the number of calories an average person needs daily must also be posted.III.Protection of Health and SafetyA.Food and DrugsThe Pure Food and Drug Act of 1906, as amended in 1938, is today’s Federal Food, Drug and Cosmetic Act (FDCPA).1.Food SafetyMost of the enforcement of the FDCPA is by the Food and Drug Administration. The act sets out—?Food standards.?Safe levels of potentially hazardous additives.?Classifications of advertising.?A food registry.?Record-keeping requirements.?Provisions for inspections.2.Tainted FoodsUnder the Food Safety Modernization Act (FSMA) of 2010—?The Food and Drug Administration can recall food products that may be tainted.?Any person who makes, processes, packs, distributes, receives, holds, or imports food products must pay a fee and register with the U.S. Department of Health and Human Services.?Owners and operators of facilities must analyze and identify food safety hazards, implement preventive controls, monitor effectiveness, and take corrective actions.?Imported foods must meet U.S. safety standards.3.Drugs and Medical DevicesThe FDA must ensure that drugs are safe and effective before they are marketed to the public. A drug’s maker must show that its product meets this standard.B.Consumer Product SafetyConsumer product safety legislation dates back at least forty years. The Consumer Product Safety Act of 1972, among other things, established authority over consumer safety under the Consumer Product Safety Commission (CPSC).1.The CPSC’s AuthorityThe CPSC—?Conducts research on product safety.?Maintains a clearinghouse on the risks associated with some products.?Sets standards for consumer products.?Bans the manufacture or importation and sale of products that are potentially hazardous to consumers.?Removes from the market any products imminently hazardous.?Requires manufacturers to report on products sold or intended for sale that have proved to be hazardous.?Administers other product safety legislation.2.Notification RequirementsThe Consumer Product Safety Act requires manufacturers to report on any products already sold or intended for sale if the products have proved to be hazardous.C.Health-Care Reforms1.Expanded Coverage for Children and SeniorsUnder the Patient Protection and Affordable Care Act of 2010—?Children can stay on their parents’ health insurance until age 26.?Lifetime and annual limits on care are eliminated.?Preventive services, such as cancer-screening, must be provided without cost to patients.?Medicare patients get a 50 percent discount on name-brand drugs.?Medicare’s prescription drug coverage gap will close by 2020.2.Controlling Costs of Health InsuranceUnder the Patient Protection and Affordable Care Act of 2010—?Insurance companies must spend 85 percent of premium dollars from large employers, and 80 percent from individuals and small employers, on benefits and quality improvement.?States can require insurance companies to justify premium increases to participate in a health insurance exchange.Additional Background—Health-Care ReformsProvisions of the Patient Protection and Affordable Care Act of 2010 cover early retirees, community health centers, public programs, and—?Insurance companies cannot deny coverage for preexisting conditions or cancel coverage for technical mistakes.?Small businesses are eligible for tax credits for providing insurance benefits to workers.?States can receive federal funds to cover low-income individuals and families.IV.Credit ProtectionThe Consumer Financial Protection Bureau oversees the practices of banks, mortgage lenders, and credit-card companies.A.The Truth-in-Lending ActThe Truth-in-Lending Act (TILA) of 1968, which is administered by the Federal Reserve Board, requires sellers and lenders to disclose credit or loan terms to debtors so that the latter may shop around for the best available financing terms.1.ApplicationCreditors who, in the ordinary course of business, lend money or sell goods on credit to consumers, or arrange for credit for consumers, are subject to the TILA.2.Disclosure RequirementsUnder Regulation Z, in any transaction involving a sales contract in which payment is to be made in more than four installments, a lender must disclose all the credit terms clearly and conspicuously. This includes—?Installment loans.?Retail and installment sales.?Car loans.?Home improvement loans.?Real estate loans when the amount financed is less than $25,000.3.Equal Credit OpportunityThe Equal Credit Opportunity Act of 1974 prohibits (1) denial of credit on the basis of race, religion, national origin, color, sex, marital status, age and (2) credit discrimination based on whether an individual receives certain forms of income.4.Credit-Card RulesLiability of a cardholder is $50 per card for unauthorized charges made before the issuer is notified the card is lost. An issuer cannot bill for unauthorized charges if a card was improperly issued. To withhold payment for a faulty product, a cardholder must use specific procedures.Additional Background—The Fair Credit Billing ActIn 1974, Congress enacted the Fair Credit Billing Act as a part of the Truth-in-Lending Act. Under the terms of the Fair Credit Billing Act, a buyer can withhold payment for a product that was bought with a credit card and that is alleged to be defective. It is up to the credit card issuer to intervene and attempt to settle the dispute. A buyer does not have an unlimited right to stop payment, however. The buyer must first exercise a good faith effort to get satisfaction from the seller.Other provisions of the Fair Credit Billing Act relate to disputes over billing. If a debtor believes there is an error in a bill, the debtor may suspend payment until the credit card company investigates the complaint. The credit card holder, within sixty days of receipt of the disputed bill, must write to the company issuing the card and explain the basis of the alleged error. The company must resolve the dispute within ninety days, during which time it can neither close the account or issue additional financing charges. If, however, the error is unfounded and is resolved against the debtor, the creditor may seek to collect finance charges for the entire period for which payments were not made.5.Amendments to Credit-Card RulesOther, more recent provisions—?Protect consumers from retroactive increases in interest rates on existing card balances unless the account is sixty days delinquent.?Require companies to provide forty-five days’ notice to consumers before changing credit-card terms.?Require companies to send out monthly bills to cardholders twenty-one days before the due date.?Prevent companies from increasing the interest rate on a customer’s credit-card balance except in certain situations such as the expiration of a promotional rate.?Prevent companies from charging over-limit fees except in certain situations.?Require companies to apply payments in excess of the minimum amount due to the customer’s highest-interest balance first when the borrower has balances with different rates.?Prevent companies from computing finance charges based on the previous billing cycle.B.The Fair Credit Reporting ActUnder the Fair Credit Reporting Act of 1970, consumer credit reporting agencies may issue credit reports only for certain purposes (extension of credit, etc.). Under the act, consumers must be notified when information is being given out by a credit agency about their credit standing.1.Consumer Notification and Inaccurate InformationA consumer who is denied credit, or is charged more than others would be, on the basis of a report must be notified of the fact and of the agency that issued the report. Consumers must be allowed to correct any misinformation. Inaccurate information must be deleted within a reasonable period of time.2.Remedies for ViolationsA credit agency may be liable for actual damages and additional damages up to $1,000, plus attorneys’ fees. Creditors and others, including insurance companies, that use credit information may also be liable.C.Fair and Accurate Credit Transactions Act?The Fair and Accurate Credit Transactions Act (FACT Act) of 2003 established a national “fraud alert” system so that consumers who suspect identity theft can place an alert on their credit files.?The FACT Act requires credit-reporting agencies to provide consumers with free copies of their reports.?Businesses are required to include shortened (“truncated”) account numbers on credit card receipts.?Financial institutions must work with the FTC to identify indicators of identity theft and develop rules for disposing of credit information.Additional Background—Credit ReportsBefore approving loan applications, commercial lenders will typically order a credit report from a credit bureau to determine the applicant’s creditworthiness and to assess any risks of default by the applicant. Credit bureau reports typically provide financial data about the applicant’s bank accounts and credit card accounts. These reports may also include such things as any unsatisfied judgments or charges. Because these reports figure prominently in any decision by the lender to approve or deny credit, significant problems can result when these reports contain erroneous or irrelevant data. To avoid such problems, Section 607(a) of the Fair Credit Reporting Act (FCRA) [15 U.S.C. § 1681] requires that credit bureaus maintain adequate procedures to insure that obsolete data is not included in any credit report. The FCRA also requires that credit bureaus take reasonable steps to verify the accuracy of the information contained in their reports. Despite concerns expressed in Congress and elsewhere, however, the FCRA contains no requirement that the information contained in the credit report be relevant. In other words, all sorts of extraneous data, regardless of whether or not it reflects on the creditworthiness of the applicant, may be included in the report.Due to problems arising from misinformation in as many as a third of consumers’ credit files, under the Fair and Accurate Credit Transactions Act of 2003, the major credit-reporting agencies must provide consumers, annually, copies of their credit reports on request, free of charge. Due to current difficulties in obtaining the free reports, however, and because the reports do not include the FICO scores developed by Fair Isaac Corp. on which lenders and others commonly rely, many consumers might find it more effective to buy the reports from a source that includes the FICO score in the reports.D.The Fair Debt Collection PracticesThe Fair Debt Collection Practices Act (FDCPA) of 1977 regulates the practices of collection agencies collecting consumer debts. It applies only to debt-collection agencies that, usually for a percentage of the amount owed, attempt to collect debts on behalf of someone else.1.Requirements of the ActThe FDCPA prohibits—?Contacting the debtor at the debtor’s place of employment if the employer objects.?Contacting the debtor during inconvenient times or at any time if an attorney represents the debtor.?Contacting third parties other than the debtor’s parents, spouse, or financial advisor about payment unless a court agrees.?Using harassment, or false and misleading information.?Contacting the debtor any time after the debtor refuses to pay the debt, except to advise the debtor of further action to be taken.Collection agencies must give a debtor a validation notice that states he or she has thirty days to dispute the debt and request written verification of it. 2.Enforcement of the ActThe FTC enforces the act. Penalties include actual damages, additional damages not to exceed $1,000, and attorneys’ fees. Debt collectors are not liable if they can show that a violation was unintentional and the result of a “bona fide error” despite following procedures designed to avoid such errors.Additional Background—State Consumer Protection LawsState consumer protection laws include provisions that, like federal statutes, are directed at deceptive trade practices. The Uniform Commercial Code (UCC) sections on warranties and unconscionability, and the Uniform Consumer Credit Code (UCCC) sections on truth in lending, maximum credit ceilings, door-to-door sales, referral sales, and fine-print clauses, also apply in situations involving consumers..Perhaps the most significant consumer protection provided by the UCC is the principle of unconscionability based on UCC 2–302. This section, as interpreted by the courts, prohibits the enforcement of contracts that are so one-sided and unfair that they “shock the conscious” of the court. Although the UCC does not provide precise standards for determining whether a contract is unconscionable, it does suggest that such a contract must greatly offend our sense of justice and fairness. The purpose behind this protection is explained in the following excerpt from UCC 2–302, Comment 1.Purposes:1. This section is intended to make it possible for the courts to police explicitly against the contracts or clauses which they find to be unconscionable. In the past such policing has been accomplished by adverse construction of language, by manipulation of the rules of offer and acceptance or by determinations that the clause is contrary to public policy or to the dominant purpose of the contract. This section is intended to allow the court to pass directly on the unconscionability of the contract or particular clause therein and to make a conclusion of law as to its unconscionability. The basic test is whether, in the light of the general commercial background and the commercial needs of the particular trade or case, the clauses involved are so one-sided as to be unconscionable under the circumstances existing at the time of the making of the contract. .??.??. The principle is one of the prevention of oppression and unfair surprise .??.??. and not of disturbance of allocation of risks because of superior bargaining power.V.Protecting the EnvironmentA.Federal RegulationFederal laws intended to improve environmental quality include the National Environmental Policy Act (NEPA) of 1969, which requires federal agencies to prepare environmental impact statements (EIS) when major federal actions significantly affect the quality of the environment.1.Environmental Regulatory AgenciesThere is also a list of federal agencies, including the Environmental Protection Agency (EPA), that deal with environmental matters.2.Environmental Impact StatementsAn environmental impact statement (EIS) must be prepared for every major federal action that significantly affects the quality of the environment.?An action is major if it involves a substantial commitment of resources (monetary or other).?An action is federal if a federal agency has the power to control it.An EIS must analyze—?The impact on the environment that the action will have.?Any adverse effects to the environment and alternative actions that might be taken.?Irreversible effects the action might generate.If an agency decides that an EIS is unnecessary, it must issue a statement supporting this conclusion.mon Law ActionsCommon law doctrines that were applied against polluters centuries ago may still be applied today.1.NuisancePersons may be liable if they use their property in a way that unreasonably interferes with others’ rights to use or enjoy their property. Courts balance the equities between the harm caused and the cost of stopping it.?Distinct harm separate from that affecting the general public is a private nuisance. Some states require this to support standing for an individual plaintiff.?A public authority can maintain an action to stop a public nuisance.2.Negligence and Strict LiabilityBusinesses may be sued under these theories.VI.Air and Water PollutionA.Air PollutionFederal law provides a basis for regulations of pollution emitted from mobile and stationary sources.1.Mobile Sources of Air Pollution?Federal regulations specify standards and timetables for mobile sources (cars, trucks, and other motor vehicles). The EPA updates these and other standards to reduce emissions further when new scientific evidence is available.?By 2050, emissions of nitrogen oxide and other pollutants from mobile sources are to be reduced by 80 percent. National standards for fuel economy and emissions for medium- and heavy-duty trucks are to be applied starting with 2014 models.Additional Background—Mobile SourcesSome of the most recent mobile source regulations are discussed in the text. Other provisions amending the Clean Air Act cover the introduction of alternative-fuel vehicles in California.To ensure compliance with emission regulations, the EPA certifies a prototype of a new car whose emission controls are effective up to 50,000 miles. The EPA may inspect production models. If a car does not meet the standards in actual driving, the EPA can order a recall and the repair or replacement of pollution-control equipment at the manufacturers’ expense. To ensure compliance, the EPA certifies a prototype of a new car whose emission controls are effective up to 50,000 miles. The EPA may also inspect production models. If a vehicle does not meet the standards in actual driving, the EPA can order a recall and the repair or replacement of pollution-control equipment at the manufacturers’ expense.Service stations must sell gasoline with higher oxygen content in forty-one cities with winter carbon monoxide pollution and must sell even cleaner-burning gasoline in Los Angeles and eight other urban areas.2.Stationary Sources of Air PollutionUnder the Clean Air Act, the primary responsibility for controlling and preventing pollution from stationary sources (manufacturing plants and so on) rests with the states. Different standards apply to sources in clean areas and sources in polluted areas, and to existing sources and major new sources.a.Hazardous Air PollutantsThe focus is on hazardous air pollutants (HAPs), which are likely to cause death or serious illness such as cancer. The EPA lists about 200 HAPs.b.Maximum Achievable Control TechnologyPerformance standards for major sources require the use of maximum achievable control technology (MACT), which is subject to EPA guidelines.c.Greenhouse GasesAccording to the EPA, greenhouse gases, including carbon dioxide, are a public danger. Based on a 2009 ruling of the United States Supreme Court, the EPA has the authority to regulate greenhouse gases.3.Violations of the Clean Air Act?Civil penalties include assessments of up to $25,000 per day, or an amount equal to a violator’s economic benefits from noncompliance, plus up to $5,000 per day for other violations.?Criminal penalties include fines of up to $1 million and imprisonment of up to two years.?Private citizens can sue.Case Synopsis—Case 39.3: United States v. O’MalleyDuane O’Malley owned and operated Origin Fire Protection. Michael Pinski hired Origin to remove and dispose of insulation wrapped around pipes in a building Pinski owned in Kankakee, Illinois. The insulation contained asbestos, which Pinski, O’Malley, and O’Malley’s employees recognized. But O'Malley did not have a license to remove asbestos, none of his employees were trained in complying with federal asbestos regulations, and the Environmental Protection Agency (EPA) was not notified of the removal. The debris was disposed of in an abandoned farmhouse, a dumpster, and a vacant lot, where it leaked into the soil. O’Malley was convicted of removing, transporting, and dumping asbestos in violation of the criminal provisions of the Clean Air Act. He appealed.The U.S. Court of Appeals for the Seventh Circuit affirmed. O’Malley argued that the government was required to prove he knew the asbestos was one of six types of asbestos regulated by the EPA. But “the very fact that O'Malley was knowingly working with asbestos-containing material met the mens rea requirement.”..................................................................................................................................................Notes and QuestionsBefore O’Malley was hired, he convinced Pinski, the owner of the building with the asbestos-lined pipes, that he would remove the insulation properly and dispose of it in a proper landfill, and even save Pinski money in the process. But O’Malley insisted on a payment in cash of $12,000 and did not provide a written contract for the job. Should Pinski have been charged with “knowingly violating” the Clean Air Act? If O’Malley misled Pinski to believe that he was licensed to remove asbestos, his other assurances might have seemed legitimate and reasonable. The cash payment and lack of a written contract might have raised a red flag in some persons’ minds, but these might have been factors that others would have overlooked due to a course of prior dealing or usage in the trade, O’Malley’s “salesmanship,” or some other factor. At worst, Pinski was na?ve. At best, he was deceived by O’Malley. In either circumstance, most likely Pinski did not “knowingly violate” the Clean Air Act.B.Water PollutionLaws and regulations govern the pollution of navigable waters, drinking water, and ocean water. Federal regulations governing water pollution date from the turn of the last century.1.The Clean Water ActThe Clean Water Act (CWA) of 1972 amended the Federal Water Pollution Control Act (FWPCA) of 1948 and laid out specific time schedules and limits. The goals are to—?Make waters safe for swimming.?Protect fish and wildlife.?Eliminate the discharge of pollutants into the water.a.Permit System for Point-Source EmissionsUnder the CWA and a National Pollutant Discharge Elimination System (NPDES), any point source of pollution emitted into water must have a permit. Permits can be obtained from the EPA and authorized state agencies and Indian tribes, and must be renewed every five years.b.Standards for EquipmentRegulations specify the use of the best available control technology (BACT) for new sources. Existing sources must first install the best practical control technology (BPCT).2.Violations of the Clean Water ActLying about a discharge is more serious than admitting to an improper discharge. The penalties for violations include civil fines of up to $25,000, criminal fines of substantial amounts, and imprisonment, plus injunctions and damages. Citizens can sue. Polluters can be ordered to clean up the pollution or pay for the cost of doing so.3.Drinking WaterUnder the Safe Drinking Water Act of 1974, the EPA sets maximum levels for pollutants in public water systems. System operators must use the best available technology that is economically and technologically feasible. Suppliers must inform the public of the source of the water, the level of contaminants, and possible health concerns.Additional Background—Drinking Water PollutantsMore than 200 pollutants, many of which are associated with cancer and other serious ailments, are known to exist in groundwater used for drinking in at least thirty-four states.4.Oil PollutionUnder the Oil Pollution Act of 1990, any onshore or offshore oil facility, oil shipper, vessel owner, or vessel operator that discharges oil into navigable waters or onto an adjoining shore may be liable for cleanup costs, as well as damages.Additional Background—Ocean DumpingThe Marine Protection, Research, and Sanctuaries Act of 1972 (Ocean Dumping Act) regulates transporting and dumping into the ocean. Dumping of radiological, chemical, and biological warfare agents and high-level radioactive waste is prohibited.Civil penalties include assessments of not more than $50,000 or revocation or suspension of a permit. Criminal penalties include fines of up to $50,000, imprisonment for not more than a year, or both. Injunctions can be imposed.VII.Toxic Chemicals and Hazardous WasteA.Pesticides and HerbicidesUnder the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) of 1947, pesticides and herbicides must be—?Registered before they can be sold.?Certified and used only for approved applications.?Used in limited quantities when applied to food crops.Violations include selling substances that are not registered or that are labeled falsely. Penalties include fines off up to $50,000 and imprisonment of up to on year for commercial dealers, with lesser penalties for private users.B.Toxic SubstancesThe Toxic Substances Control Act of 1976 regulates chemicals and chemical compounds that are known to be toxic and provides for investigation of any possible harmful effects from new compounds. The EPA regulations require special labeling, production and use quotas, and the prohibiting of use altogether.C.Resource Conservation and Recovery Act?The Resource Conservation and Recovery Act (RCRA) of 1976 requires that the EPA determine which forms of solid waste should be considered hazardous and regulate hazardous waste storage, disposal, and treatment.?Penalties for violations include up to $25,000 (civil) per violation, $50,000 (criminal) per day, and imprisonment up to two years (may be doubled for repeaters).D.SuperfundThe Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, or Superfund) of 1980, regulates the cleanup of leaking hazardous waste disposal sites. The primary elements of CERCLA are—?Information gathering and analysis system that enables the government to identify chemical dump sites and determine the appropriate action.?EPA authority to respond to hazardous substance emergencies and to arrange for the cleanup of a leaking site directly if the persons responsible fail to do so.?Hazardous Substance Response Trust Fund (Superfund) to pay for the clean up of hazardous sites using funds obtained through taxes on certain businesses.?Government recovery of the cost of cleanup from the persons who were (even remotely) responsible for hazardous substance releases.1.Potentially Responsible PartiesWhen a release or a threatened release occurs, the EPA can clean up a site and recover the cost from any or all of the following potentially responsible parties (PRPs)—?A party who generated the waste disposed of at the site.?A party who transported the waste to the site.?A party who owned or operated the site at the time of the disposal.?The current owner or operator.2.Joint and Several Liability?Liability is usually joint and several (a firm that generated only a fraction of the waste may be liable for all cleanup costs).?One party can be charged with the entire cost (which that party may recover in a contribution action against others).3.DefensesAn innocent property owner may avoid liability by showing the lack of a contractual or employment relation to the party who released the hazardous substance. In effect, this requires a buyer to investigate possible hazards at the time property is bought.Enhancing Your Lecture—????How Can You Keep Abreast ofEnvironmental Laws??????Businesspersons today increasingly face the threat of severe civil or criminal penalties if they violate environmental laws and regulations. Thus, it is crucial to be aware of what those laws and regulations are, how to monitor changes in them, and when to consult with an attorney during the normal course of business. Consider some areas of concern that affect businesses.Factors to Consider When Purchasing Business PropertyWhen purchasing business property, keep in mind the environmental problems that may arise. Realize that it is up to you as a purchaser of the property to raise environmental issues—sellers, title insurance companies, and real estate brokers will rarely pursue such matters. (A bank financing the property may worry about the potential environmental hazards of the property, however.)As a purchaser of business property, you should find out whether there are any restrictions regarding the use of the land, such as whether it can be cleared of trees for construction purposes. The most important environmental concern, though, is whether the property has been contaminated by hazardous wastes created by the previous owners.Investigate Land-Use HistoryPurchasers of property can be held liable under Superfund for the cleanup of hazardous wastes dumped by previous property owners. Although current property owners who pay cleanup costs can sue the previous owners for contribution, such litigation is expensive and the outcome uncertain. Clearly, a more prudent course is to investigate the history of the use of the land prior to purchasing the property. You might even want to hire a private environmental site inspector to determine, at a minimum, whether the land has any obvious signs of former contamination.Investigate and Correct Environmental ViolationsToday’s companies have an incentive to discover their own environmental wrongdoings. The federal sentencing guidelines encourage companies to promptly detect, disclose, and correct wrongdoing, including environmental crimes. Companies that do so are subject to lighter penalties for violations of environmental laws. Thus, a company would be well advised to conduct environmental compliance audits regularly.Small businesses (those with up to one hundred employees) will find it particularly advantageous to investigate and correct environmental violations. Under current EPA guidelines, the EPA will waive all fines if a small company corrects environmental violations within 180 days after being notified of the violations (or 360 days if pollution-prevention techniques are involved). The policy does not apply to criminal violations of environmental laws or to actions that pose a significant threat to public health, safety, or the environment.Checklist for the Businessperson1.If you are going to purchase real estate, use land, or engage in activities that might cause environmental damage, check with your attorney immediately.2.If you want to avoid liability for violating environmental regulations or statutes, conduct environmental compliance audits on a regular basis.3.If you are ever charged with violating an environmental regulation or law, contact your attorney.4.In general, environmental law is sufficiently complex that you should never attempt to deal with it without the help of an attorney.Teaching Suggestions1.Ask students to discuss examples of puffery involving nationally advertised products. How do companies advertise their products when they wish to engage in aggressive marketing campaigns? Do these campaigns ever involve what are arguably false statements of fact?2.Ask students whether corrective advertising in an excessively harsh remedy for dealing with past deceptive advertising campaigns because the FTC may simply issue cease-and-desist orders. Is the corrective advertising remedy used to inform consumers about the true worth of a particular product or simply to punish the company for its past practices?3.Are there certain circumstances in which a person receiving unsolicited merchandise should be required to return the merchandise to the sender if he or she does not wish to purchase it? What are some of the reasons that the federal government might wish to make no exceptions to the rule freeing consumers of any liability for failing to return unsolicited merchandise?4.To illustrate that the costs of many kinds of pollution are borne not by the polluter but by somebody else, use an example of what has been called the tragedy of the commons. Ask students to imagine, for example, a pasture open to the livestock of all farmers. As the number of livestock begins to exceed the capacity of the pasture to provide adequate grazing, each farmer nevertheless continues to increase the size of his or her own herd. The additional benefit of increasing a herd always seems positive, because each individual farmer receives all of the benefits from the added stock while most of the costs are borne by the other farmers. Eventually, the pasture is ruined for all.5.Explain that one of the problems with common law causes of action in environmental litigation concerned questions of proof. Because of the widespread effects of pollution, it may be impossible to prove any particular polluter solely responsible for a specific injury or damage. Also, the common law limited relief from pollution in situations where the harm was caused by two or more independent sources. For example, if a number of firms were polluting the air, a harmed individual could sue any individual firm; however, until early in the twentieth century, the plaintiff was not able to sue all of the firms simultaneously. Consequently, specific proof of damages in individual actions was often impossible.6.When CERCLA was enacted, most legislators believed that cleaning up a site was relatively inexpensive and involved removing containers and scraping a few inches of soil off the ground. Today, there is a multibillion dollar Superfund industry. Should either of these facts make any difference in the enforcement or the amendment of CERCLA?7.At the federal level, consumer law and environmental law are inseparable from administrative law. For this reason, you may find it helpful when studying the law in this chapter to consider the material in the text on administrative law.Cyberlaw LinkWhat legal protection against cyberfraud exists? What are the legal issues for advertising and promoting a product on a Web site?What are the legal issues surrounding the disposal of computers and related products, many of which contain hazardous substances? Who should be liable if disposal results in harm to the environment or to individuals?Discussion Questions1.What is puffery? Puffery consists of vague generalities and obvious exaggerations about a particular product. Puffery is not actionable because it does not entail false statements of fact about a particular product. Statements that refer to a car, for example, as being “the best vehicle on the road” do not involve statements of fact and are, consequently, characterized as puffery. Yet it is also true that the person making the statement will have to be careful not to use language that may have obvious factual inferences.2.How does a bait-and-switch advertisement work? Bait-and-switch advertising involves displaying a low price in a store window, for example, of a particular item that will likely be unavailable to the consumer, who will then be encouraged to purchase a more expensive item. The low price is the “bait” to lure the consumer into the store. The salesperson is instructed to “switch” the consumer to a different item. Under the FTC guidelines, bait-and-switch advertising occurs if the seller refuses to show the advertised item, fails to have in stock a reasonable quantity of the item, fails to promise to deliver the advertised item within a reasonable time, or discourages employees from selling the item.3.What are some of the actions that may be taken by the FTC against deceptive advertising practices? Assuming that the FTC investigation indicates that further action is warranted by the government, the FTC may issue a cease-and-desist order requiring that the company cease and desist its advertising practices. Moreover, the FTC may order affirmative advertising (which requires the company to provide specific information about its advertisement so as to prevent consumers from being misled), counteradvertising (in which the company admits that prior claims about its product were untrue) or multiple product orders (which require a firm to cease and desist from false advertising not only in regard to the product that was the subject of the action but also in regard to all of the firm’s other products).4.What are some of the tactics that may not be used by collection agencies to collect debts? A collection agency may not (1) contact the debtor at the debtor’s place of employment if the debtor’s employer objects; (2) contact the debtor during inconvenient or unusual times (e.g., call the debtor at 3 o’clock in the morning) or at any time if the debtor is being represented by an attorney; (3) contact third parties other than the debtor’s parents, spouse, or financial advisor about payment of a debt unless a court authorizes such action; (4) use harassment or intimidation (e.g., using abusive language or threatening violence), or employ false and misleading information (e.g., posing as a police officer); or (5) communicate with the debtor at any time after receiving notice that the debtor is refusing to pay the debt, except to advise the consumer of further action to be taken by the collection agency.5.What are the primary functions and powers of the Consumer Products Safety Commission (CPSC)? The CPSC conducts research on the safety of individual products, and it maintains a clearinghouse on the risks associated with different consumer products. Under the Consumer Product Safety Act, the CPSC is authorized to set standards for consumer products and to ban the manufacture and sale of any product it deems to be potentially hazardous to consumers. The CPSC also has the authority to remove from market shelves any products it believes to be imminently hazardous and to require manufacturers to report on any products already sold or intended for sale if the products have proved to be hazardous. The CPSC also has authority to administer other product safety legislation. The CPSC’s authority is sufficiently broad to allow it to ban any product which the CPSC believes poses an “unreasonable risk” to the consumer.6.How may a polluter be held liable on a common law nuisance theory? A polluter may be held liable for the use of property in a way that unreasonably interferes with others’ rights to use or enjoy their property. A nuisance may be public or private. A public nuisance is a cause of action based on harm to the public. A public authority (such as a state’s attorney general) sues to abate a public nuisance. A private nuisance is a cause of action based on harm distinct from that suffered by the public. An individual property owner may sue for relief on this theory. In some states, persons are denied standing unless they suffer harm distinct from that to the public. In a nuisance suit, a court balances the equities between the harm caused and the cost of stopping it—that is, if the cost to stop pollution is greater than the harm it causes, it may not be stopped (although an award of damages—which may include compensation for total economic loss to property—is still proper).7.Under the National Environmental Policy Act, when are federal agencies required to prepare environmental impact statements? The National Environmental Policy Act requires federal agencies to prepare environmental impact statements when major federal actions significantly affect the quality of the environment. An action is “major” if it involves a substantial commitment of resources. An action is “federal” if a federal agency has the power to control it (to license its construction or operation, for example).8.The Clean Air Act provides a basis for regulating air pollution from what two kinds of sources? The Clean Air Act provides a basis for regulating air pollution from mobile sources (motor vehicles) and stationary sources (public utilities, industrial plants). Under the Clean Air Act, the Environmental Protection Agency sets standards for major pollutants. General guidelines set out requirements for protecting vegetation, climate, visibility, and certain economic conditions.9.How are the objectives of the Clean Water Act to be accomplished? The Clean Water Act established a new system of goals, standards, and timetables to (1) make waters safe for swimming, (2) protect fish and wildlife, and (3) stop the discharge of pollutants into water. Generally, these objectives are being accomplished under a permit system. Under the time schedules—extended in 1977 and by the Water Quality Act in 1987—the Environmental Protection Agency sets limits for discharges based on technology available for controlling them (generally, regulations specify the best available technology). Polluters must apply for permits. Violations may be subject to civil or criminal penalties. Injunctions and damages can be awarded. A polluter can be required to clean up the pollution or pay for a clean up.10.Is it appropriate to impose significant fines on citizens, or even imprison individuals, when they violate environmental laws? Increasingly, businesspersons and others who violate environmental, consumer, health and safety laws and regulations find themselves subject to not only hefty fines but to prison terms. Whether large fines and prison terms are appropriate responses to such violations is clearly debatable. To be sure, the more such sanctions are publicized, the more deterrent effect we will observe on behavior. Some observers do argue, nonetheless, that such sanctions are inappropriate for violations of environmental laws unless they result in serious and immediate physical harm to others.Activity and Research Assignments1.Ask students to call local credit bureaus and find out about the procedure and expense involved in securing a credit report on a particular individual. The students should also attempt to ascertain what sorts of procedures are used by the individual bureaus to safeguard the privacy of the individual featured in the report and the criteria used to determine the personal information that will be included in the report.2.Direct students to contact local manufacturers and other businesses to ask about the impact of local, state, and federal environmental regulations. Some businesspersons may see the regulations as little more than time-consuming paperwork. Others may be doing more than the law requires to protect the environment. If so, what more are they doing? Have students share what they learn with the class.Explanations of Selected Footnotes in the TextFootnote 11: Gaetano Paduano bought a new Honda Civic Hybrid in California. The EPA fuel economy estimate on the label—mandated by the federal Energy Policy and Conservation Act (EPCA)—was 47 miles per gallon (mpg) for city driving and 48 mpg for highway driving. Honda’s sales brochure added, “Just drive the Hybrid like you would a conventional car and save on fuel bills.” The car’s fuel economy proved to be less than half of the EPA estimate. A Honda employee told Paduano that to achieve the estimate he would have to drive in a manner that “would create a driving hazard.” When American Honda Motor Co. refused to buy the car back, Paduano filed a suit in a California state court against the automaker, alleging deceptive advertising in violation of the state’s Consumer Legal Remedies Act and Unfair Competition Law. Honda argued that the EPCA preempted these claims. The court issued a judgment in Honda’s favor. Paduano appealed. In Paduano v. American Honda Motor Co., a state intermediate appellate court concluded that the federal law did not preempt Paduano’s claims, and reversed and remanded. Paduano “seeks to prevent Honda from making misleading claims about how easy it is to achieve better fuel economy. Contrary to Honda’s assertions, if Paduano were to prevail on his claims, Honda would not have to do anything differently with regard to its disclosure of the EPA mileage estimates.” In fact “allowing states to regulate false advertising and unfair business practices may further the goals of the EPCA.”Is the ruling in this case favorable for the auto market? Why or why not? In the long-term, the ruling might improve the market by leading to more truthful advertising and consumer confidence in that advertising. The same result could undercut sales and profit, however, by increasing consumer mistrust of auto sellers’ statements about their products. In the short-term, the decision could lead to a loss of profit through refunds and replacements to consumers situated similarly to the plaintiff in this case.Footnote 38: A well-documented rise in global temperatures has coincided with a significant increase in the concentration of carbon dioxide in the atmosphere. Some scientists believe that the two trends are related because, when carbon dioxide is released into the atmosphere, it produces a greenhouse effect, trapping solar heat. Under the Clean Air Act (CAA) of 1963, the Environmental Protection Agency (EPA) is authorized to regulate “any” air pollutants “emitted into .??.??. the ambient air” that in its “judgment cause, or contribute to, air pollution.” Calling global warming “the most pressing environmental challenge of our time,” a group of private organizations asked the EPA to regulate carbon dioxide and other “greenhouse gas” emissions from new motor vehicles. The EPA refused, stating in part that Congress last amended the CAA in 1990 without authorizing new, binding auto emissions limits. The petitioners, nineteen states—including Massachusetts—and others asked the U.S. Court of Appeals for the District of Columbia Circuit to review the EPA’s denial. In Massachusetts v. Environmental Protection Agency, the United States Supreme Court held that greenhouse gases fit within the Clean Air Act's (CAA’s) definition of “air pollutant.”Did the EPA have the authority to regulate greenhouse gas emissions from new motor vehicles? If so, was its stated reason for refusing to do so consistent with that authority? The Supreme Court held that the Environmental Protection Agency (EPA) has the authority under that statute to regulate the emission of such gases from new motor vehicles. According to the Court, the definition, which includes “any” air pollutant, embraces all airborne compounds “of whatever stripe.” The EPA's focus on Congress’s 1990 amendments (or their lack) indicates nothing about the original intent behind the statute (and its amendments before 1990). Nothing in the statute suggests that Congress meant to curtail the agency’s power to treat greenhouse gases as air pollutants. In other words, the agency has a pre-existing mandate to regulate “any air pollutant” that may endanger the public welfare.The EPA also argued that, even if it had the authority to regulate greenhouse gases, the agency would not exercise that authority because any regulation would conflict with other administration priorities. The Court acknowledged that the CAA conditions EPA action on the agency’s formation of a “judgment,” but explained that judgment must relate to whether a pollutant “cause[s], or contribute[s] to, air pollution which may reasonably be anticipated to endanger public health or welfare.” Thus, the EPA can avoid issuing regulations only if the agency determines that greenhouse gases do not contribute to climate change (or if the agency reasonably explains why it cannot or will not determine whether they do). The EPA’s refusal to regulate was thus “arbitrary, capricious, or otherwise not in accordance with law,” The Court remanded the case for the EPA to “ground its reasons for action or inaction in the statute.” ................
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