preemption

The Supreme Court’s 2016-2017 docket is now set. The Court is still down a Justice but has accepted as many cases as usual (about 75). In theory all the cases discussed below will be decided by June 30, 2017. The Court may decide to rehear tied (4-4) cases next term, when a new Justice will presumably join the bench.

This articles covers cases of interest to the states which the Court agreed to hear this term accepted after September 15, 2016. Here is a summary of cases of interest to the states which the Court agreed to hear before September 15, 2016.

State and local governments would not be disappointed if the Supreme Court overturned Chevron v. NRDC (1984). While overturning Chevron isn’t on the table in Coventry Health Care of Missouri v. Nevils, limiting it is. The State and Local Legal Center (SLLC) asked the Court in its amicus brief to rule that Chevron deference does not apply when an agency is construing the scope of a statute’s preemption provision, absent Congress’s assent.   

In Chevron v. NRDC the Supreme Court held that courts should defer to reasonable agency interpretations of ambiguous statutes. States and local governments generally prefer that courts not defer to federal agency regulations because this deference gives federal agencies a lot of power. 

Every time a federal agency thinks the scope of a preemption clause in federal law is too narrow may it just write a regulation expanding it? That is the heart of the matter in Coventry Health Care of Missouri v. Nevils.

The question of most interest to state and local governments in this case, more technically, is whether Chevron deference applies to an agency’s regulation construing the scope of a statute’s express-preemption provision.

The question in Kindred Nursing Centers v. Clark is whether the Federal Arbitration Act preempts Kentucky’s rule that an “attorney-in-fact” may bind a principal to an arbitration agreement only if the power-of attorney document expressly refers to arbitration agreements.

A number of parents executed power-of-attorney documents designating one of their children “attorney-in-fact.” While some of these documents gave the children broad rights to act on their parent’s behalf (“to do and perform for me in my name all that I might if present”), none explicitly gave their children the authority to agree to arbitration (rather than a jury trial) to resolve disputes regarding their parent’s legal rights.

In a unanimous opinion in Hughes v. Talen Energy Marketing the Supreme Court held that Maryland’s program which guarantees a power plant generator a contractual rate rather than the “clearing price” wholesale rate set at a federally-approved capacity auction is preempted by the Federal Power Act (FPA).

The State and Local Legal Center filed an amicus brief arguing that Maryland’s program should not be preempted. At least one other state, New Jersey, has implemented a similar program.  

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