Wednesday, March 08, 2006

Ruling Sparks Industry Push For Court Review Of Agencies' Data Decisions

Industry officials are planning to push for a series of administrative, judicial and legislative remedies to overcome this week's long-awaited court order that blocked their bid for a precedent-setting ruling granting judicial review of EPA and other federal agencies' decisions under the Information Quality Act (IQA).  But key members of the business community are split on whether to push for new legislation that would explicitly establish private parties' right to sue under the act or whether they should instead focus on new test cases.

The U.S. Chamber of Commerce is seeking a new law to establish that private parties can sue the government under the IQA. House regulatory affairs subcommittee Chairman Candice Miller (R-MI) told Inside EPA on March 8 that she had yet to read the ruling, but may propose legislation establishing judicial review under the act and possibly fold that into a package of reforms to reauthorize the Paperwork Reduction Act.

But the Center for Regulatory Effectiveness (CRE), an industry-funded watchdog group and a leading proponent of the act, is exploring whether to file lawsuits in other federal appellate circuits over three ongoing IQA disputes with federal agencies, instead of seeking a legislative fix on the judicial review issue.

Officials from the two groups agree that the White House Office of Management and Budget (OMB) should take a more active role in reviewing agencies' decisions under the act, a concern OMB is acknowledging. “OMB will continue to work with the agencies to ensure interagency consistency and the agencies' adherence to the IQ Act and OMB's government-wide guidelines,” an OMB spokesman says.

The IQA, which was slipped into a massive appropriations bill signed into law by President Clinton in December 2000, allows outside parties to petition agencies to fix alleged inaccuracies in federally disseminated data, but is silent on the issue of judicial review. Environmentalists and other activist groups are harshly critical of the act, saying it is an industry tool that can chill the dissemination of information used by agencies to justify policy decisions.

The industry debate over how to proceed was set off March 6 with a decision in Salt Institute and U.S. Chamber of Commerce v. Michael Leavitt, where the U.S. Court of Appeals for the 4th Circuit affirmed a lower court ruling that the plaintiffs lacked standing to sue under the act. The ruling is a major blow to industry efforts to use the courts to challenge EPA and other federal agencies' IQA decisions.

Unlike the broader lower court decision in the case, the three judge panel on the 4th Circuit ruled narrowly on the issue of whether the plaintiffs had standing to sue, and stated, without providing reasoning, that the statute does not provides judicial review when plaintiffs are seeking corrections of federally disseminated data. “By its terms, the statute creates no legal rights in any third parties,” the ruling says.

The case stemmed from industry groups disputing findings by the Department of Health and Human Services that suggested that all Americans could reduce their blood pressure by lowering their sodium consumption. The salt industry said reduced sodium consumption is beneficial to only certain groups of Americans, and requested as part of its IQA petition that the government make publicly available all information that supported findings saying otherwise.

But the government refused to provide the information, and interpreted the industry's petition as a request for data under the Freedom of Information Act (FOIA). Both the lower court and 4th Circuit agreed with the government, with the 4th Court saying the plaintiffs did not have a right to the data under FOIA.

“Because the statute upon which appellants rely does not create a legal right to access to information or to correctness, appellants have not alleged an invasion of a legal right, and thus have failed to establish injury in fact,” according to the opinion written by 4th Circuit Judge Michael Luttig, who was rumored to be on President Bush's short list for a spot on the Supreme Court.

The opinion was the first by a federal appeals court on the IQA, and has sparked fears among industry officials that the act will be rendered useless because they will not be able to use the courts to hold agencies “accountable” if they deny requests to correct data that EPA and other agencies rely on for their policy and regulatory decisions. The industry plaintiffs say they are undecided on whether to appeal the case to the full 4th Circuit, but have 45 days to make a decision.

A chamber official blasts the ruling, saying, “No human on earth could” hold an agency accountable for a decision under the IQA because of the 4th Circuit's opinion. The official says, “All options are on the table” to respond to the decision and is urging Congress to pass legislation establishing judicial review, either through reauthorization of the Paperwork Reduction Act or other means.

The chamber official fears that federal agencies will now be more inclined to reject data quality correction requests. But the CRE source disputes that assertion, saying agencies' delays to act on certain IQA petitions is a sign that they are still wary that parties could try to sue over a final agency action under the act.

The CRE and other sources say the Salt Institute case did not represent the best case to test whether the act was judicially reviewable because the plaintiffs were in part seeking data, rather than the correction request process outlined in the IQA.

CRE is also rejecting the chamber official's calls to seek legislation that would make the IQA judicially reviewable. “I think it's premature to seek a legislative remedy,” an official with the group says. “I say this because the court's opinion is pretty narrow. . . .You will get a big fight, and [legislation] could constrain the act.”

Instead, the group argues that it is exploring several possibilities for new litigation, saying since the facts in these potential lawsuits differ substantially from the Salt Institute case, the CRE would be able to establish reviewability of the act.

The group may bring an IQA suit in the D.C. Circuit against the Occupational Safety & Health Administration (OSHA) to challenge regulations used to identify chemicals or substances as carcinogenic health hazards. The group in a Nov. 10, 2005, request for correction says OSHA needs to “make clear” that it is making an independent determination that its hazard regulations are based on the data quality standards established under the IQA.

The group alleges that OSHA is relying on a World Health Organization (WHO) body, which is not subject to the IQA, in order to make decisions on the chemical vinyl acetate and other substances. The group says relying on the WHO cancer body is “improper and illegal,” if the agency is not ensuring the information meets IQA standards.

OSHA has not made a final decision on the request for correction, but the CRE says it may challenge a denial in the D.C. Circuit.

In addition, the CRE may join the Americans for Safe Access, a medical marijuana advocacy group, in a lawsuit challenging the Department of Health & Human Services (HHS) denial of a petition requesting correction of HHS data saying marijuana is not considered to have medical value. The department contends that there is conflicting evidence on its medical uses, while the group claims there is a “substantial consensus” that the drug can be used to treat an array of ailments, including nausea, pain, loss of appetite and spastic paralysis.

The department has not made a final decision on an administrative appeal the group filed in May 2005, which some experts say could mean that the government anticipates a lawsuit over a final decision under the act. The marijuana group has threatened to file litigation, possibly in the U.S. District Court in the Northern District of California to compel the government to act on the appeal. CRE is advising the group on the possible suit, which would end up at the 9th Circuit on appeal.

CRE says that if the government was not concerned about litigants' ability to establish judicial review, it would have made a final decision on the medical marijuana petition a long time ago.

Also, CRE may file a lawsuit on a data correction request filed with HHS' National Toxicology Program, but the official declined to provide specifics on the nature of the complaint or the possible venue.

The group says resource constraints will only allow it to participate in one of the three potential lawsuits.

While CRE believes these cases could be more successful than the Salt Institute case, critics dispute the group's assertion.

An official with the Center for Progressive Reform, a think tank that has called for repeal of the IQA, says other lawsuits in other circuits, regardless of the facts, would have an uphill battle because the 4th Circuit stated that the law does not create a private right to action. “This has very sweeping implications,” the source says.

The source adds that the dismissal on legal standing grounds makes it very difficult for legislation to establish judicial review because the bill would also have to describe who could bring a lawsuit forward. If any party who disputes an agency interpretation can sue, “it would flood the federal courts” and bog down federal policies, the source says.

In addition, several congressional committees could assert jurisdiction over IQA legislation, hindering industry's push to pass legislation quickly. -- Manu Raju

Date: March 8, 2006

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