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Wicker Urges Need to Restore NTIA Protections in Infrastructure Bill

WASHINGTON – U.S. Sen. Roger Wicker, R-Miss., ranking member of the Senate Committee on Commerce, Science, and Transportation, today delivered remarks on the Senate floor on his amendment (#2146) that would restore the requirements of the Administrative Procedure Act (APA) to provide transparency and necessary protections to National Telecommunications and Information Administration’s (NTIA) regulatory actions. The infrastructure legislation provides the NTIA with an exemption from the requirements of the APA for the implementation and administration of the broadband infrastructure grants. The APA is a federal statute that governs the process by which Federal agencies develop rules and regulations. It provides important protections, including public notice and comment periods, established timelines, and formal procedures that must be followed.

Click here to watch the floor speech.

Excerpt from Ranking Member Wicker’s remarks, as delivered, below:


Mr. President, I offer today what should be considered a friendly amendment to the broadband section of this infrastructure bill.

Why is it a friendly amendment? Because by using the Administrative Procedures Act, which my amendment would provide, it would save billions of dollars in broadband buildout funds. It would provide for consumer input, stakeholder input, local and state government input, into NTIA, the agency that would be in charge of this broadband buildout. And also, because it will not delay the broadband buildout in any way.

Now, as written today, the broadband section waives the administrative procedures. 

The Wicker amendment would simply strike that waiver, and make the Administrative Procedure Act apply to the broadband section, as it applies to so many big programs that are enacted.

If we pass this amendment, here will be the timeline. Let’s assume the president doesn’t get around to signing this bill until October the first. I would expect the president would sign it earlier than that, but let’s assume that he does that. 

There’ll be 30 days of notice, 30 days of public comment after the notice is published, a review of those comments, which could take 30 to 40 days. At that point the regulations are published, and after 30 days they go into effect.

So, by my calculations, assuming the president’s very, very late in signing the bill, the Act and the regulations under the Administrative Procedures Act would be done by February 7th. 

Now what we all know, and everyone in this chamber knows, is that we have to wait on the FCC maps, and they will not be ready until the earliest, until the earliest by spring of next year, and that is very, very optimistic.

So, we have time to do it right, to get public input, to have people who’ve already experienced this come to agency and say, “You might want to do it this way” or “you might want to avoid doing it that way because  here’s our experience.”

We did this one time before, and it was only $4.7 billion. This is $42 billion. That was the BTOP program, which was enacted in 2009. We skipped this, we gave it to an agency which is gonna happen this time, the NTIA, a staff of only 157 people, to monitor, back then, $4.7 billion. This time it’s $42 billion.

Here’s what we learned about the BTOP program, which is an awful lot like this one. When Congress asked NTIA to administer this, the results were deeply troubling. 

Let me quote the Inspector General. Let me quote the Stanford Institute of Economic Policy and the Phoenix Center. Their own Inspector General found that the agency faced significant challenges in managing the size and complexity of the program. It’s a program a tenth the size of what we’re talking about today.

The Stanford Institute said NTIA’s mechanism for selecting projects was “incoherent.” NTIA adopted, had they adopted more reasonable frameworks, many more households could have been connected with the same money, or the same number of connections could have been realized for a fraction of the cost, because they didn’t do what I’m advocating for today Mr. President.

The Phoenix Center, an independent think tank, said they found “no positive effect on home broadband adoption” from the BTOP program.

Mr. President and my fellow colleagues, years from now, when someone realizes we’ve wasted billions of dollars on this buildout, I want, I would want and I think my colleagues would want  to say, “Well I voted yes on the Wicker amendment.” 

To take the extra 130, 140 days, to hear what went right and what went wrong in the past and to make sure we get it right.

No senator has worked harder than I have on broadband buildout. I want this program to succeed. This is a way to make sure we spend the money correctly, to make sure we do it right.

I ask unanimous consent at this point, Mr. President, to put into the record an article dated August 3rd, just yesterday, from The National Journal. It says, “How $65 billion for Broadband Infrastructure Could Fall Short.” I ask that it  be entered into the record at this point.

Mr. President, I don’t want this program to fall short. I want it to succeed. This amendment gives us a chance to get the money right, to take the extra time that we’re going to have to take anyway to get the maps right. 

It’s a good government amendment, a friendly amendment, and I urge bipartisan adoption of it.  

 

Toxic Marketing Claims and Their Dangers

WASHINGTON, D.C. — U.S. Senator Richard Blumenthal (D-CT), Chair of the Subcommittee on Consumer Protection, Product Safety, and Data Security, will convene a hearing titled, “Toxic Marketing Claims and Their Dangers” at 2:30 p.m. on Tuesday, August 3, 2021. The hearing will address, among other topics, how alleged deceptive marketing practices and claims may have fueled the proliferation of unsafe products among vulnerable populations in the United States, particularly those of e-cigarettes and vaporizers among youth and current smokers looking for cessation tools.

 

Witnesses: 

 

  • Mr. Josh Stein, Attorney General, North Carolina
  • Dr. Robert Jackler, Professor, Stanford University; Founder, Stanford Research Into The Impact of Tobacco Advertising
  • Ms. Ariel Fox Johnson, Senior Counsel for Global Policy, Common Sense Media
  • Ms. Maureen Ohlhausen, Former Acting Chair, Federal Trade Commission

 

*Witness List is Subject to Change 

 

Hearing Details: 

 

Tuesday, August 3, 2021

2:30 P.M. EDT 

Subcommittee on Consumer Protection, Product Safety, and Data Security

SR-253

 

This hearing will take place in the Russell Senate Office Building 253. Opening statements and a live video of the hearing will be available at www.commerce.senate.gov

 

Due to current limited access to the Capitol complex, the general public is encouraged to view this hearing via the live stream. Social distancing is now lifted for vaccinated members of the press who wish to attend. The Office of the Attending Physician recommends that all individuals wear masks while in interior spaces and other individuals are present.

 

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New Mexico Attorney General’s Public-Nuisance Suit Against Medical-Product Sterilization Firm a Dangerous Abuse of State Authority

WLF Legal Pulse - Mon, 08/02/2021 - 11:09am

By Paul Gessing, President of the Rio Grande Foundation, a a 501(c)(3) research and education institute in Albuquerque, New Mexico. This post is reprinted with Mr. Gessing’s permission after originally appearing on the foundation’ blog, Errors of Enchantment, on July 29.

*****

On December 22, 2020, Attorney General Balderas filed suit against product-sterilization company Sterigenics, alleging that ethylene oxide (EtO) emissions from its plant in Santa Teresa were creating a public nuisance and asking the court to enjoin the emissions.

You can read the AG’s complaint here.

Here is one informative report on lawsuit. 

According to the federal court docket (Sterigenics had initially removed the case from state to federal court but the federal court refused to accept the removal and sent it back to the state court), private contingent-fee lawyers from the Delaware-based firm Grant & Eisenhofer are working with Balderas on the suit.

Such state AG-contingent fee attorney arrangements have become commonplace. The alliances raise questions as to who is really in charge of litigating on behalf of the public interest, and what really motivates the private plaintiffs’ lawyers.

Grant & Eisenhofer is advancing hundreds of private lawsuits against Sterigenics. Having a state AG action be successful in enjoining EtO emissions would be a boon to the firm’s private litigation efforts.

Sterigenics has operated the Santa Teresa plant since 1989. It sterilizes surgical kits, preoperative skin products, syringes, tubing, and other medical equipment using EtO. 50% of the devices sterilized nationally are sterilized with EtO. An Albuquerque Journal story noted that the state hospital association wrote to New Mexico Governor Grisham explaining the consequences if the state shut down the plant. The story also relates an affidavit from a device company microbiologist noting the suit’s impact on its product and patients.

The suit alleges that Sterigenics is causing a nuisance with “uncontrolled” emissions of EtO that the attorney general claims are increasing cancer risks in the areas around the plant.

Sterigenics argues that the state offers no evidence of actual harm. The complaint leans heavily on a 2016 U.S. EPA risk assessment that the company says “drastically overestimates the risk from EO exposure.” The company’s brief in opposition to the state’s injunction request adds:

The IRIS [Integrated Risk Information System] erroneously states that an EO of concentration as low as .0002 micrograms per cubic meter (the equivalent of 0.1 parts per trillion) poses a one-in-a-million lifetime cancer risk to someone exposed to that concentration continuously (24 hours per day) over 70 years. That miniscule concentration is order of magnitude below the endogenous EO levels produced within the human body. It is also orders of magnitude below the concentrations of EO in everyday ambient air, which the EPA has reported range from 0.185 to 0.397 micrograms per cubic meter of air (103 to 220 parts per trillion), with an average of 0.297 micrograms per cubic meter of air 164 parts per trillion). It is millions of times below the concentrations emitted by a single lawnmower or a single backyard charcoal grill, and is exponentially lower that the exposure level the U.S. Occupational Safety and Health Administration (‘OSHA’) has determined is safe for employees working inside sterilization facilities.

Sterigenics U.S., LLC’s Brief in Opposition to Plaintiff’s Emergency Motion for Temporary Restraining Order and Preliminary Injunction, New Mexico v. Sterigenics et al., at 9-10 (references omitted).

As explained well in an amicus brief filed by AdvaMed, the Chamber of Commerce of the USA, the National Association of Manufacturers, and the New Mexico Chamber of Commerce, companies like Sterigentics that use EtO in their sterilization must comply with detailed regulations issued by FDA, EPA, OSHA, and the state environmental regulatory agency. Those agencies undertake meticulous efforts to craft and issue those regulations and employ issue experts in the process of setting emissions limits.

The “uncontrolled” emissions allegedly occur a number of ways, including the opening and closing of facility doors and when customers visit the plant and carry away their sterilized products. The federal emissions permits (which are issued by the New Mexico Environment Department and with which Sterigenics is in full compliance) do not impose limits on those emissions because the regulators consider that controlling them is entirely impractical. So what the state’s complaint essentially demands that the emissions limit Sterigenics must meet is zero.

A judicial verdict implementing the AG’s zero-emissions approach would directly conflict with federal and state regulations, placing the AG and the court into the role of environmental regulators, a role they are entirely unfit to fulfill. That outcome creates a compliance nightmare for Sterigenics and bodes ominously for any business in New Mexico or businesses looking to locate offices in New Mexico.

On June 29, District Judge Beyer granted the state’s motion for a preliminary injunction, prohibiting “continued uncontrolled emissions of EtO.” It’s unclear as of this moment what has occurred in the meetings between the state and Sterigenics that the court ordered with a goal of creating a “monitoring protocol.”

Bottom line: Attorney General Balderas’ isn’t doing the state, the state’s business community, or New Mexicans any favors by pursuing this regulation-by-litigation effort to usurp control over EtO and its use from federal and state agencies whose authority over EtO emissions are firmly bound in statutes. His lawsuit will stoke fear over miniscule EtO emissions and device sterilization and any victories in the suit could help the suit’s masterminds in the private contingent-fee lawyer’ bar turn EtO into the next asbestos.

Other resources:

https://www.reuters.com/article/factcheck-eo-swabs/fact-check-nasal-swabs-sterilised-with-ethylene-oxide-are-safe-to-use-the-sterilisation-process-is-tightly-regulated-by-international-standards-idUSL1N2LU1H0

https://www.ehstoday.com/environment/article/21152366/ethylene-oxide-the-next-regulatory-battleground

https://cei.org/studies/epa-should-revise-its-assessment-of-medical-supply-sterilant/

The post New Mexico Attorney General’s Public-Nuisance Suit Against Medical-Product Sterilization Firm a Dangerous Abuse of State Authority appeared first on Washington Legal Foundation.

Categories: Latest News

July 2021 Month in Review

WLF Legal Pulse - Mon, 08/02/2021 - 9:00am

This WLF Litigation Division feature highlights WLF court and agency filings, as well as decisions issued in response to WLF’s filings. In this edition, we list July 2021 filings and results.

Click on the PDF button above for the full report.

NEW FILINGS

  • United States v. Facteau—WLF asks the First Circuit to reverse, on First Amendment grounds, the criminal convictions of two medical-device company executives under the FDCA.
  • Mamani v. Berzain—WLF urges the Eleventh Circuit to overturn a $10 million jury award under the Torture Victim Protection Act.

DECISIONS

  • CVS Pharmacy Inc. v. Doe—The Supreme Court agrees to decide whether Rehabilitation Act allows disparate-impact claims.
  • In re Letter Requesting Publication—The California Court of Appeal for the Fourth District declines to publish a recent opinion in an important products liability case.
  • In re Rescission of 2015 FTC Statement on Unfair Methods of Competition—After allowing only six days for public comment, the FTC votes to rescind a 2015 statement providing clarity on “unfair methods of competition” under Section 5 of the FTC Act.

The post July 2021 Month in Review appeared first on Washington Legal Foundation.

Categories: Latest News

In re Zofran: When Arguing Preemption, the Best Defense May Be a Smart Regulatory Offense

WLF Legal Pulse - Fri, 07/30/2021 - 9:55am

By Daniel J. Feith, counsel to Sidley Austin LLP and former Deputy Assistant Attorney General, Consumer Protection Branch, U.S. Department of Justice.

On June 1, 2021, a Massachusetts federal district court ruled that federal law preempted claims that GlaxoSmithKline LLC (GSK) failed to adequately warn of risks associated with taking the anti-nausea drug Zofran during pregnancy.  In re: Zofran (Ondansetron) Prods. Liability Litig., 2021 WL 2209871 (D. Mass. June 1, 2021).  This ruling, which brought an end to multi-district litigation over Zofran, demonstrates the ongoing benefit to drug makers of the Supreme Court’s decision in Merck Sharp & Dohme Corp. v. Albrecht, 139 S. Ct. 1668 (2019), that judges, not juries, must decide whether prescription drug failure-to-warn claims are preempted.  In addition, in basing its preemption determination on FDA actions that GSK elicited after the litigation had begun, the ruling provides drug makers with a valuable lesson: post-Albrecht, the best litigation defense may be a smart regulatory offense.

Background

Zofran (ondansetron) is an anti-nausea drug approved in 1991 for the prevention of nausea and vomiting induced by surgery, chemotherapy, or radiation.  For years, it has also been prescribed off-label for preventing nausea and vomiting during pregnancy.  In 2015, plaintiffs began bringing state-law claims against GSK—which manufactured Zofran until March 2015, when it sold the rights to Novartis—alleging that it failed to warn of the risk of birth defects from taking the drug during pregnancy.  Later that year, 425 suits involving such claims were consolidated into a multi-district litigation, In re: Zofran (Ondansetron) Products Liability Litigation, No. 15-md-2657 (D. Mass.).

As a defense, GSK asserted that these claims were preempted because federal law prohibited it from adding the warnings that state law allegedly required.  This defense turned on whether GSK could have unilaterally revised Zofran’s labeling to add the warnings plaintiffs sought.  Under the Federal Food, Drug, and Cosmetic Act (FDCA), manufacturers generally may not change a drug’s labeling without FDA approval.  In 2009, however, the Supreme Court held that state-law failure-to-warn claims were not preempted if a drug manufacturer could unilaterally change labeling as state law required under the “Changes Being Effected” (CBE) regulation, which permits manufacturers to alter risk information in approved labeling based on “newly acquired information.”  See Wyeth v. Levine, 555 U.S. 555, 570-72 (2009) (citing 21 C.F.R. § 314.70(c)(6)(iii)(A)).  At the same time, the Court recognized that preemption would still apply “when there is ‘clear evidence’ that the FDA would not have approved the warning that state law requires.”  Albrecht, 139 S. Ct. at 1676 (quoting Wyeth, 555 U.S. at 571).

In 2018, GSK moved for summary judgment on its preemption defense.  It contended that it had provided the FDA with all relevant information and that the information the plaintiffs relied on was immaterial.  In support of these arguments, GSK relied on the FDA’s inaction in 2011 regarding Zofran’s labeling after receiving supplemental information from GSK regarding Zofran’s pregnancy-related risks, the FDA’s denial of a 2013 citizen petition to add a pregnancy-related warning to Zofran’s labeling, and the FDA’s denial of a 2015 application by Novartis to add pregnancy-related warnings to the labeling.  The plaintiffs responded that GSK had not fully informed the FDA of the basis for pregnancy-related warnings because GSK had allegedly withheld several categories of relevant information.  In February 2019, the district court denied GSK’s motion, holding that whether GSK had fully met its disclosure obligations, and whether the information GSK allegedly withheld was material, were factual questions that must be submitted to the jury.

Three months after the district court’s decision, the Supreme Court decided Albrecht, which elaborated on Wyeth’s “clear evidence” standard in two important respects.  First, it held that judges, rather than juries, must decide whether the FDA would have rejected the proposed warning, even if that determination required resolving “contested brute facts.”  139 S. Ct. at 1680.  Second, the Court explained that to establish clear evidence of the FDA’s disapproval, a manufacturer must “show that it fully informed the FDA of the justifications for the warning required by state law and that the FDA, in turn, informed the drug manufacturer that the FDA would not approve changing the drug’s label to include that warning.”  Id. at 1678.  In dicta, the Court also noted that the FDA’s disapproval must take the form of “agency action carrying the force of law.”  Id. at 1679.

Following Albrecht, GSK renewed its motion for summary judgment.  In addition, GSK and Novartis followed the path mapped in Albrecht to obtain “clear evidence” of preemption.  First, in 2019, GSK filed a citizen petition asking the FDA to review all the information that the plaintiffs claimed GSK had withheld and to determine whether it warranted adding pregnancy-related warnings to Zofran’s labeling.  GSK also attached the various reports, studies, and analyses that the FDA supposedly had not yet seen.  The FDA subsequently met with counsel for both GSK and the plaintiffs, and the plaintiffs submitted additional exhibits, including expert reports from the MDL.  See In re: Zofran, 2021 WL 2209871, at *10-11.  Second, in 2020, Novartis submitted a prior approval supplement (PAS) to the FDA proposing labeling changes.  Those changes included adding statements that “use of ondansetron in pregnancy is not recommended” and that “[i]t is possible that ZOFRAN can cause fetal harm,” and removing a statement that “[a]vailable data do not reliably inform the association of ZOFRAN and adverse fetal outcomes.”  Novartis argued that these changes were justified by new epidemiological studies.  See id. at *12-13.

The FDA rejected both GSK’s and Novartis’s requests.  It denied GSK’s petition on procedural grounds, “without comment on the relevance, if any, of [the submitted] information to ondansetron product labeling.”  Id. at *11-12.  It also rejected Novartis’s proposed warning against use of Zofran during pregnancy on the ground that the available data do not support the warning given inconsistencies in the published findings and limitations in the design of the epidemiological studies.  Novartis then proposed several other changes, including adding a statement that, “based on the available data,” certain adverse fetal outcomes “cannot be ruled out.”  In March 2021, the FDA rejected that proposal as well, instead agreeing only to a new statement that “available data … preclude an assessment of drug-associated risk of adverse fetal outcomes due to important methodological limitations.”  See id. at *13-15.

The District Court’s Decision

On June 1, following the FDA’s decisions, the district court granted GSK’s renewed motion for summary judgment.  At the outset, the court assumed, without deciding, that GSK could have unilaterally changed Zofran’s labeling through the CBE process prior to 2015.  The court therefore did not consider GSK’s arguments that the information on which the plaintiffs relied was not “newly acquired information,” as required by the CBE regulation.  See id. *28.

The court instead focused on whether the FDA was fully informed of the justifications for the proposed warning by the time of its 2021 decision on Novartis’s PAS.  The court found that by the time of that decision, GSK and Novartis not only had provided the relevant information to the FDA but also had made the agency aware of the plaintiffs’ contentions regarding the significance of that information.  Accordingly, the court concluded that “all of the information concerning the safety of Zofran that plaintiffs allege was withheld from the FDA had been provided to it by the time of the 2020 Novartis PAS,” and “the FDA was ‘fully informed’ of the justifications for the warning label that plaintiffs contend was required by state law.”  Id. at *29-30.

Next, the court examined whether the FDA had informed the manufacturer that it would not approve the proposed warning.  The court noted that Novartis had “specifically requested warnings concerning the use of Zofran during pregnancy, based on the possibility of fetal injury,” including warnings that “‘[t]he use of ondansetron in pregnancy is not recommended’” and that “‘[i]t is possible that ZOFRAN can cause fetal harm when used during pregnancy.’”  Id. at *30-31.  But, the court explained, the FDA “rejected that proposal” as unsupported by “available data” and instead approved labeling stating that “‘[a]vailable postmarketing data have not identified a drug-associated risk of miscarriage or adverse maternal outcomes.’”  Id. at *31.  Thus, the court concluded, the FDA had “approved a label that contains language that is directly contrary to the language proposed by plaintiffs.”  Id.  Furthermore, the court held, the FDA’s disapproval in a PAS decision clearly carried the force of law.  See id.

Finally, the court responded to several arguments the plaintiffs made to avoid the preemptive effects of the decision on Novartis’s PAS.  First, the plaintiffs argued that “there is insufficiently clear evidence that the FDA would have rejected a label with enhanced pregnancy warnings related to animal studies” because Novartis did not propose any changes to the portion of the labeling stating that animal studies did not show any fetal risk from use during pregnancy.  The court, however, explained that even though the FDA was not asked to change that portion of the labeling, it was fully informed of and asked to consider the relevant studies cited by the plaintiffs.  See id.

The court also rejected the notion that the FDA had not considered the information simply because Novartis had not called into question the animal-studies portion of the labeling.  That notion, the court stated, “assumes that the FDA was not following the statutory requirement that it consider ‘all’ relevant information in evaluating the PAS.”  Id. at *32 (citing 21 C.F.R. § 201.57(c)(9)(i)(B)).  The court rebuffed the assumption that the FDA “blatantly ignored” its duties, finding it “highly unlikely” that the agency “turned a blind eye to evidence that Zofran causes birth defects.”  Id.  The court also observed that several other courts had found preemption “where the manufacturer had not requested the precise warning sought by the plaintiffs when the FDA had nonetheless made it clear that it would not accept that label change.”  Id.

Second, the court held that it was irrelevant that the FDA’s disapproval was directed to Novartis rather than GSK.  The court explained that, under Supreme Court precedent, the “essential question … is whether a manufacturer would be permitted to add a warning proposed by a plaintiff to a drug’s label.”  Id. at 33.  Preemption therefore “does not depend on whether the defendant manufacturer is the one who asked for the changes, or to which the FDA explicitly communicated its decision.”  Id.

Ultimately, the court concluded that the FDA had been “fully informed of the justifications for the warning proposed by plaintiffs,” and that “there is no doubt that the FDA would not approve the changes to the warning label proposed by plaintiffs.”  Id. at *3.  Given this clear evidence of FDA disapproval, the court held that federal law preempted the plaintiffs’ claims.  On July 1, the plaintiffs appealed the district court’s decision to the First Circuit.

Significance

The In re: Zofran decision demonstrates Albrecht’s pivotal impact on prescription drug products liability litigation, which primarily entails failure-to-warn claims.  Before Albrecht, the Zofran MDL was headed to trial, where a jury would have been tasked with determining whether GSK fully complied with its disclosure obligations and whether the information GSK allegedly withheld would have been material to FDA’s labeling decisions—two legally and scientifically complex questions that the jury would have had to decide after likely having had its views colored by the plaintiffs’ evidence of birth defects associated with use of Zofran during pregnancy.  Instead, as a result of Albrecht, the district court decided these issues before trial in a clear, thorough opinion focused only on the evidence relevant to preemption.  The district court’s opinion also demonstrated an understanding, often lacked by juries, of the delicate balance the FDA must strike in determining the appropriate content and format of drug labeling.  Whereas juries see only the costs of omitting a given warning, cf. Riegel v. Medtronic Inc., 552 U.S. 312, 325 (2008), the district court recognized that the FDA “is concerned not only with avoiding insufficient warnings (that is, failing to warn against risks), but also avoiding over-warning (that is, warning against risks that are unduly speculative, hypothetical, or not adequately supported by science),” which might deter beneficial uses of a drug.

In re: Zofran also demonstrates how, post-Albrecht, a strong litigation defense can depend on a smart regulatory offense.  Instead of relying on the existing record of FDA decision making when it renewed its summary judgment motion, GSK, together with Novartis, expanded that record by filing a citizen petition and PAS with the FDA, respectively.  Those actions, together with the FDA’s responses, were critical to the district court’s determination that the FDA had disapproved the warnings proposed by the plaintiffs after having been fully informed of their justifications.  Drug makers potentially could even forestall litigation entirely through similar regulatory engagement strategies.

Furthermore, In re: Zofran suggests a way drug makers can persuade courts to accept the lengthy delays associated with engaging with FDA in the midst of litigation.  Here, FDA took ten months to fully resolve Novartis’s PAS, and fourteen months to resolve GSK’s citizen petition.  Judges may be reluctant to accept such lengthy delays to allow FDA to act.  In re: Zofran, however, suggests that they arguably should as a matter of primary jurisdiction.  Without explicitly saying so, the decision recognized that by reframing the “clear evidence” inquiry as a question of whether FDA actually disapproved a proposed change after having been fully informed of its justifications, Albrecht made preemption turn on matters within FDA’s “special competence.”  United States v. W. Pac. R. Co., 352 U.S. 59, 64 (1956); see 21 C.F.R. § 10.25(b) (recognizing the FDA’s “primary jurisdiction to make the initial determination on issues within its statutory mandate”).  As In re: Zofran demonstrates, labeling decisions satisfy the three factors that traditionally warrant a primary jurisdiction referral: they are at the heart of the task the FDCA assigns FDA, depend on FDA’s expertise, and would materially aid courts in resolving pharmaceutical failure-to-warn claims.  See Arroyo-Melecio v. Puerto Rican Am. Ins. Co., 398 F.3d 56, 73-74 (1st Cir. 2005).  Accordingly, In re: Zofran supports permitting drug makers to present FDA with warnings proposed by plaintiffs in products liability cases even after litigation has begun.

Finally, In re: Zofran adds to a growing body of case law answering, in a manner favoring preemption, questions left open by Albrecht.  In particular, In re: Zofran sheds light on the significance, if any, that should be ascribed to FDA inaction.  In Albrecht, the majority “noted” in dicta that only agency action carrying the force of law can have preemptive effect, Albrecht, 139 S. Ct. at 1679, but Justice Alito observed in a concurrence that FDA’s decision “not to act” on new information is also relevant to preemption given FDA’s duty under 21 U.S.C. § 355(o)(4) to initiate a labeling change if it becomes aware of safety information that should be included in the labeling, id. at 1684 (Alito, J., concurring in the judgment).  In re: Zofran endorses, at least to an extent, Justice Alito’s broader view.  Relying on FDA’s duty to consider “all” information regarding pregnancy-related risks, see 21 C.F.R. § 201.57(c)(9)(i)(B), the district court refused to narrowly construe FDA’s PAS decision as preempting only the specific warnings Novartis proposed, and instead read it broadly to disapprove other potential labeling changes addressed by the information before FDA.  In re: Zofran thus suggests that, at a minimum, FDA inaction in response to new information can influence how broadly a court construes affirmative FDA actions, such as PAS decisions.  See also In re Incretin-Based Therapies, 2021 WL 880316, at *16-17 (applying § 355(o)(4) in a similar manner).

The post <em>In re Zofran</em>: When Arguing Preemption, the Best Defense May Be a Smart Regulatory Offense appeared first on Washington Legal Foundation.

Categories: Latest News

Consent Decrees’ Hidden Costs to Businesses and Consumers

WLF Legal Pulse - Fri, 07/30/2021 - 9:48am

By Thad H. Westbrook and C. Mitchell Brown, partners, and Thomas Hydrick, an associate, with Nelson Mullins Riley & Scarborough LLP in the firm’s Columbia, South Carolina office.

During the past few decades the use of consent decrees by federal and state enforcement agencies to resolve enforcement actions has become more pervasive and extensive than many business leaders may realize. Although the use of these decrees is well-documented, the long-term effects of the decrees are less understood.

This article seeks to explore one long-term effect associated with the use of consent decrees—the direct and indirect costs imposed by the use of injunctive or nonmonetary relief terms. In exploring these costs, this article highlights and scrutinizes some common problems associated with the use of injunctive or nonmonetary relief terms. Because these terms often impose costs on consumers and business which outweigh their benefits, enforcement agencies should rethink their approach to the use of these terms. This article concludes by offering agencies some considerations for reducing the costs associated with such decrees.

Nonmonetary Relief in Consent Decrees

Enforcement agencies of all stripes have expanded their use of consent decrees in recent decades. Some federal agencies now rely almost exclusively on them to resolve enforcement actions.1 At the state level, state attorneys general regularly use consent decrees to obtain various forms of relief.2

Although the terms of the decrees vary widely on a case-by-case basis, both federal and state enforcement agencies frequently include terms for injunctive or nonmonetary relief.3 This form of relief is the focus of this article and for shorthand will be referred to as a “structural term” of a consent decree.

To understand the extent of the costs imposed by structural terms, it is helpful to first understand common types of structural terms in consent decrees. Structural terms available in consent decrees are significantly broader and more expansive than the type of nonmonetary relief that might otherwise be available in a judicial proceeding. As a result, and as discussed further below, the costs of these structural terms can be significant.

Here are a few of the most common structural terms:

  • Compliance – Enforcement agencies often require a targeted entity to explicitly state it will comply with certain or all applicable laws. These types of requirements are seen across enforcement agencies and can impose a variety of requirements on targeted entities.4
  • Reporting – Reporting requirements mandate targeted entities or independent parties to provide information to the agency on a regular basis.5
  • Inspection – Regulators may require the target entity to hire an independent expert to inspect its products.6 Alternatively, an inspection term may require the target entity to allow the enforcement agency to inspect its files and records.7
  • Testing – A variation of the inspection requirement is a testing requirement, which requires the entity itself to test its products in the future to ensure compliance with applicable laws.8

In short, consent decrees can include a wide range of structural terms, which can exceed and surpass traditional forms of nonmonetary relief available through the court systems.

Structural Terms and Citizen Welfare

It is important to first consider how these costs can be measured. Although the costs of these terms could theoretically be calculated in multiple ways, their costs should be assessed broadly according to their overall impact on citizen welfare.

A citizen-welfare-focused approach is justified given the mission and purpose of many enforcement agencies.9

With this metric in mind, before an enforcement agency negotiates, drafts, or enforces a structural term in a consent decree, the agency should first consider whether the benefits of the term outweigh the potential costs to citizen welfare. Given the mission and purpose of many enforcement agencies, citizen welfare should be defined broadly to include considerations of costs to the targets of the enforcement actions, the targets’ competitors, the business community generally and, of course, consumers.

To do a cost-benefit analysis, an agency must first be able to identify, understand, and quantify the costs associated with a given structural term.  The remainder of this article attempts to aid agencies and business in this task, outlining some of the known and hidden costs structural terms impose on various citizen stakeholders.

Negotiation and Drafting Costs

The processes for negotiating and drafting these terms itself can impose costs on businesses. 

First, with respect to negotiation costs, a defining feature of the negotiation process in any enforcement action is the unequal bargaining power between the government agency and the target of the enforcement action.10 This unequal footing necessarily gives enforcement agencies greater control over the scope and extent of potential remedies in a consent decree. This power necessarily imposes greater costs on the target of the enforcement action, many of which may be passed along to third parties.

Second, with respect to drafting costs, agencies should be aware that the drafting process itself can contribute significantly to the costs of a structural term. At many agencies, the drafting process for a consent decree is driven by lawyers, many of whom lack detailed familiarity with the target entities (and the industries to which they belong). These lawyers may lack detailed familiarity with the business model of an entity and its products. As a result, agency lawyers may unwittingly seek to impose inappropriate, unreasonable, or arbitrary structural terms in a consent decree, the costs of which can pose lasting consequence for target entities. 

Direct Costs to Businesses

The most obvious direct cost imposed by a structural term in a consent decree is the cost to comply with the terms of the decree. These costs vary widely depending on the nature of the structural terms at issue and the number of jurisdictions in which a business operates and to what degree.

The presence or absence of a “sunset provision” in a consent decree will impact compliance costs. Sunset provisions limit the duration of the terms of a consent decree. After the passage of the amount of time provided for in the sunset provision, the decree expires. The length of sunset provisions varies by agency and some decrees, surprisingly, contain no sunset provision at all. In the absence of a sunset provision, decrees can continue to be in effect for extended periods of time. In extreme cases, these decrees can last for decades.11

Further, entities who operate in multiple states and decide to enter into consent decrees with enforcement agencies in one or more of those jurisdictions, find themselves in a costly compliance nightmare trying to track inconsistent and various structural terms across multiple states for several years.  Complying with a web of structural terms in multiple jurisdictions is a cost entities bear in addition to their routine compliance efforts in those jurisdictions where no consent decrees exist. 

Indirect Costs to Businesses

Structural terms also impose indirect or hidden costs on businesses, many of which are ultimately and necessarily passed on to consumers and shareholders. These indirect costs include valuation costs, lost opportunity costs, competition costs, and chilling-effects costs.

Valuation costs occur when the costs imposed by a consent decree are so significant that they affect the overall value of a business. For example, in 2010, industry reporters speculated that a consent decree entered into by Genzyme Corporation affected its stock price at the time.12 Valuation costs are particularly problematic because they are borne by shareholders. In the case of large publicly traded companies, these costs will be inflicted on a variety of entities and individuals, including institutional investors such as pension funds.

Lost opportunity costs occur when a business is forced to forego productivity in order to comply with the terms of a consent decree. In extreme cases, these costs can lead to bankruptcy. This was the case in a 2018 settlement between the Department of Justice and Cantrell Drug Company. Because the company was forced to forego certain activity until it remediated its past deficiencies and proved compliance, the company was forced to declare bankruptcy.13

Competition costs occur when a business is placed at a competitive disadvantage due to the terms of a consent decree. In recent years, various entities within the music industry have sought modifications to existing decrees on the grounds that these decrees place the entities at a competitive disadvantage.14

Chilling-effects costs occur when other businesses refrain from engaging in certain conduct out of fear of a similar enforcement action.15

Direct and Indirect Costs to Consumers

Structural terms also impose direct and indirect costs on consumers. In certain circumstances, a structural term’s cost to consumers may be obvious. For example, in a 2010 settlement with Intel Corporation, the Federal Trade Commission restricted Intel’s ability to issue certain discounts to its customers.16 This posed a clear and direct cost to consumers, who were forced to forego certain discounts. In other cases, costs are passed on to consumers indirectly. Indirect consumer costs are often hidden but can arise whenever an entity’s costs of operation directly or indirectly increase as a result of structural terms.

Other Community Costs

 In addition to costs to a specific entity or business, structural terms can impose additional costs on the community. If the structural terms of a consent decree are costly enough to an individual business, that business may be forced to forego new hiring, eliminate existing jobs, and in extreme cases, shut down. In the case of Cantrell Drug Company, discussed above, the effect of the consent decree in that case arguably led to all three results.17

Considerations for Reducing Costs

As enforcement agencies grapple with the scope and extent of costs imposed by consent decrees’ structural terms, they should consider the following cost-reduction measures:

  1. Perform a cost-benefit analysis. Although cost-benefit analysis has been a hallmark of federal regulation for decades, it is less frequently used in the context of drafting and negotiating consent decrees. Both state and federal enforcement agencies should make formal cost-benefit analyses mandatory components of drafting structural terms in consent decrees.
  2. Remember the mission. In performing a cost-benefit analysis, agencies should remember their mission and examine whether the use of structural terms aid their overall purpose. As demonstrated above, in many circumstances, structural terms can indirectly and unintentionally conflict with or undermine an agency’s mission statement. The agency’s leader should clearly state the factors he or she expects the agency to consider, consistent with its mission, in determining when and what structural terms are appropriate for consent decrees.
  3. Appropriate sunset provisions. In recent decades, agencies have shifted away from indefinite consent decrees and toward sunset provisions. However, far too many agencies continue to use arbitrary standards in defining the sunset period. Agencies should examine their applicable sunset provisions and justify the proposed time period in each provision. In doing so, they should provide a reasoned analysis to justify the proposed sunset period. The costs discussed herein should factor into the length of the period, as well as whether there should be any structural terms at all.
  4. Justify structural terms. Finally, and perhaps most importantly, agencies should provide a justification for their inclusion of structural terms in a consent decree. Structural terms are not used in all consent decrees and in many cases, are unnecessary.

Notes

The post Consent Decrees’ Hidden Costs to Businesses and Consumers appeared first on Washington Legal Foundation.

Categories: Latest News

07-29-21 Markup

House Small Business Committee News - Thu, 07/29/2021 - 10:00am
The Committee on Small Business will hold a markup of legislation to amend the Small Business Act and the Small Business Investment Act. The markup will be held at 10:00 A.M. (ET) on Thursday, July 29, 2021 in room 2360 Rayburn HOB, and livestreamed on the Committee’s Facebook live and YouTube pages. The items that will be marked up include:

H.R. 4256, “Investing in Main Street Act”

H.R. 4481, “Small Business 7(a) Loan Agent Transparency Act”

H.R. 4531, “7(a) Loan Agent Oversight Act”

H.R. 3469, “Veteran Entrepreneurship Training Act of 2021”

H.R. 3462, “SBA Cyber Awareness Act”  

H.R. 4515, “Small Business Development Center Cyber Training Act of 2021”  

H.R. 4513, “Small Business Advanced Cybersecurity Enhancements Act of 2021”


WLF Urges First Circuit Not To Criminalize Truthful, Non-Misleading Speech About Medical Devices

WLF Legal Pulse - Thu, 07/29/2021 - 9:07am

“FDCA prosecutions for truthful speech are denying doctors access to the best available information about FDA-approved drugs and devices, interfering with delivery of state-of-the art medical care.”
— Cory Andrews, WLF General Counsel & Vice President of Litigation

Click here for WLF’s brief.

WASHINGTON, DC— Washington Legal Foundation (WLF) yesterday urged the U.S. Court of Appeals for the First Circuit to reverse, on First Amendment grounds, the criminal convictions of two medical-device company executives under the Food, Drug, and Cosmetic Act (FDCA). WLF’s amicus brief was prepared with substantial pro bono assistance from Joel Kurtzberg, Adam Mintz, John Macgregor, and Jason Rozbruch of Cahill Gordon & Reindel LLP.

Bill Facteau and Patrick Fabian, former executives of medical-device maker Acclarent, were convicted of misdemeanor adulteration and misbranding under the FDCA for distributing a medical device for an “off-label” use. At trial, however, the jury found that no defendant made false or misleading statements, nor had any intent to defraud or mislead, and so acquitted on all charges requiring mens rea. That means the primary evidence of guilt supporting the defendants’ misdemeanor convictions was their truthful, non-misleading speech about Stratus’s off-label uses.

As WLF’s amicus brief explains, the defendants’ convictions cannot stand. Under the First Amendment, a criminal conviction cannot be based on truthful, non-misleading speech about a drug or device’s off-label use. The FDCA’s misbranding and adulteration regulations, as applied here, are content-, viewpoint-, and speaker-based restrictions on speech that cannot withstand strict scrutiny.    

Celebrating its 44th year, WLF is America’s premier public-interest law firm and policy center advocating for free-market principles, limited government, individual liberty, and the rule of law.

The post WLF Urges First Circuit Not To Criminalize Truthful, Non-Misleading Speech About Medical Devices appeared first on Washington Legal Foundation.

Categories: Latest News

GSA Receives Top Grade on IT Scorecard

GSA news releases - Thu, 07/29/2021 - 12:00am
Annual Federal IT Acquisition Reform Act (FITARA) scorecard results demonstrate GSA’s leadership for information technology modernization. WASHINGTON -- The U.S. General Services Administration earned a top grade (A+) on the  Federal IT Acquisition Reform Act (FITARA) scorecard. GSA was the only...

GSA Scores Top Grade in Small Business

GSA news releases - Thu, 07/29/2021 - 12:00am
WASHINGTON -- This week, the U.S. General Services Administration (GSA) earned an A+ in the Small Business Administration’s (SBA) Small Business Procurement Scorecard for Fiscal Year 2020.This is the eleventh consecutive year that GSA has received an “A” grade or higher, demonstrating the agency...

WLF Urges Eleventh Circuit To Follow Supreme Court’s Recent Nestlé Decision

WLF Legal Pulse - Wed, 07/28/2021 - 12:43pm


“The Supreme Court made clear that Congress’s incorporation of international law is fixed; it is not everchanging.”
—John Masslon, WLF Senior Litigation Counsel

Click here for WLF’s brief.

WASHINGTON, DC— Washington Legal Foundation (WLF) today urged the U.S. Court of Appeals for the Eleventh Circuit to overturn a $10 million jury verdict against a foreign nation’s civilian leaders. In an amicus brief, WLF argues that the Eleventh Circuit should follow the Torture Victim Protection Act’s plain language and limit incorporation of international law into the U.S. Code.  

The case arises from a lawsuit against a foreign country’s civilian leaders. The plaintiffs argue that United States courts can hold the defendants liable for negligently overseeing military forces. The Eleventh Circuit has issued conflicting rulings in the case. First, it held that the defendants are liable only if they acted deliberately. But nine years later it changed course and held that negligence alone was enough to impose liability.

In its brief supporting the defendants, WLF argues that the jury charge conflicted with the TVPA’s plain language because it permitted a liability finding for mere negligence rather than a deliberate act. The brief explains that the Supreme Court’s recent Nestlé decision shows that courts must look to international law at the time Congress passed a statute—not today’s international law. Because 1992 international law did not include a civilian command-responsibility theory, the district court erred by allowing the jury to impose liability under that theory.  

WLF’s brief also explains how holding civilian leaders liable for negligently overseeing troops would cause international relations problems. Allies’ civilian leaders could be hauled into U.S. court for their troops’ or American troops’ actions. This case also shows the perils of allowing juries to engage in international relations. The day after the District Court’s order denying the defendants’ motion for judgment as a matter of law, a foreign country used the order as proof that the U.S. should extradite the defendants.  WLF therefore urges the Eleventh Circuit to limit the incorporation of international law, and allow the President to engage in international relations by reversing the jury’s verdict.

Celebrating its 44th year, WLF is America’s premier public-interest law firm and policy center advocating for free-market principles, limited government, individual liberty, and the rule of law.

The post WLF Urges Eleventh Circuit To Follow Supreme Court’s Recent <em>Nestlé</em> Decision appeared first on Washington Legal Foundation.

Categories: Latest News

Nomination Hearing

WASHINGTON, D.C.— U.S. Senator Maria Cantwell (D-WA), Chair of the Senate Committee on Commerce, Science, and Transportation, will convene a full committee hearing at 10:00 a.m. on Wednesday July 28, 2021 to consider the presidential nominations of Alexander Hoehn-Saric to be a Commissioner and Chair of the Consumer Product Safety Commission (CPSC); Mary T. Boyle to be a Commissioner of the CPSC; Richard Trumka, Jr. to be a Commissioner of the CPSC; and Grant Harris to be Assistant Secretary for Industry and Analysis at the Department of Commerce.

 

Nominees

  • Mr. Alexander Hoehn-Saric, of Maryland, to be a Commissioner and Chair of the Consumer Product Safety Commission
  • Ms. Mary T. Boyle, of  Maryland, to be a Commissioner of the Consumer Product Safety Commission
  • Mr. Richard Trumka Jr., of Maryland, to be a Commissioner of the Consumer Product Safety Commission  
  • Mr. Grant Harris, of California, to be Assistant Secretary for Industry and Analysis, Department of Commerce

 

Details

Hybrid Full Committee Nominations Hearing

Wednesday, July 28, 2021

10:00 A.M.

Commerce Committee Hearing Room, SR-253

 

Watch LIVE at www.commerce.senate.gov

 

Due to current limited access to the Capitol complex, the general public is encouraged to view this hearing via the live stream. Social distancing is now lifted for vaccinated members of the press who wish to attend.

 

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Wicker Statement on Bipartisan Infrastructure Deal

WASHINGTON – U.S. Sen. Roger Wicker, R-Miss., ranking member of the Senate Committee on Commerce, Science, and Transportation, today released the following statement on the motion to invoke cloture on the motion to proceed to consider bipartisan infrastructure legislation:

“I have long been a strong supporter of investing in our core infrastructure, but I am unable to support this agreement in its current form,” Wicker said. “Yet again, Senators are being asked to move forward on a bill that we have not had an opportunity to read.”

 

La carretera en dirección sur hacia México en la Garita de Calexico West se desviará ligeramente el 30 de julio debido a las obras de construcción

GSA news releases - Wed, 07/28/2021 - 12:00am
Facilita la construcción de casetas y toldos de inspección  CALEXICO, California -- La Administración de Servicios Generales de los Estados Unidos (GSA) anunció una modificación menor a la ruta temporal que desvía los carriles de vehículos privados hacia el sur en la Garita de Calexico West a...

Calexico West Port of Entry Southbound Roadway to Mexico Shifts July 30 Due to Construction

GSA news releases - Wed, 07/28/2021 - 12:00am
Facilitates Construction of Inspection Booths and Canopies Download Full Resolution CALEXICO, Calif. -- The U.S. General Services Administration (GSA) announces a minor modification to the temporary route that detours southbound privately owned vehicle (POVs) lanes at the Calexico West Land...

Cantwell, Wicker To Commerce Secretary Raimondo: Strengthen American Cybersecurity Defenses

WASHINGTON, D.C.— U.S. Senator Maria Cantwell (D-WA), Chair of the Senate Commerce, Science, and Transportation Committee, and U.S. Senator Roger Wicker (R-MS) today wrote to Department of Commerce Secretary Gina Raimondo urging her to robustly confront growing threats to American cybersecurity and privacy. The letter follows a hearing that Chair Cantwell and Ranking Member Wicker convened on cybersecurity threats to America’s critical energy infrastructure.

“Cybersecurity threats are growing and evolving, so the federal response must do so as well.  To ensure the safety and security of the American people and economy, DOC and NIST must be part of the solution,” the Senators wrote. “The President’s Budget Request to level-fund NIST cybersecurity programs, while requesting significant increases across the agency, is insufficient to meet the need.”

The letter particularly urged the Commerce Department to implement and appropriately resource Congressional direction on growing the cybersecurity workforce and demonstrating new cyber-protection capabilities, including to more quickly respond to cyberattacks. 

“Reliance on cyber-enabled systems provides an attractive target for U.S. adversaries and cybercriminals,” the Senators wrote. “Separate threat assessments by the Director of National Intelligence and the Department of Homeland Security ranked cyberattacks as an acute threat to government at all levels as well as to the private sector.”

Chair Cantwell has been warning for years about America’s vulnerability to an attack of this kind—even issuing this warning during a 2017 Energy and Natural Resources hearing“There is the issue of cybersecurity that keeps me up at night, thinking about potential hacks from Russia or foreign actors, as we see large-scale attacks happening in other places. If we do not make the necessary investments to prevent, defend against and minimize the impact of these cyberattacks, our enemies may succeed in causing us a widespread blackout or devastation to our economy.”

  

Earlier this year, Chair Cantwell wrote to Biden DHS Secretary Alejandro Mayorkas highlighting concerns over ambiguity in cyber-related security standards.  The Secretaries of Commerce and Homeland Security today announced their intent to provide a clearer security baseline for critical infrastructure, consistent with the new National Security Memorandum on Improving Cybersecurity for Critical Infrastructure Control Systems.

  

Last Congress, Ranking Member Wicker authored the HACKED Act and CYBER LEAP Act, which were included in the 2021 National Defense Authorization Act (NDAA) and signed into law. Senator Cantwell co-sponsored the HACKED Act, along with Senators Thune (R-SD) and Rosen (D-NV). These laws will expand the cybersecurity workforce and establish prize-based contests designed to increase collaboration between the public and private sectors.

 

You can read Senator Cantwell and Senator Wicker’s full letter HERE.

 

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Wicker, Cantwell Urge Commerce Department to Confront Growing Cybersecurity Risks

WASHINGTON – U.S. Sens. Roger Wicker, R-Miss., and Maria Cantwell, D-Wash., ranking member and chair of the Senate Committee on Commerce, Science, and Transportation, today sent a letter urging Department of Commerce (DOC) Secretary Gina Raimondo to implement and appropriately resource Congressional direction on growing the cybersecurity workforce and demonstrating new cyber-protection capabilities to respond quickly to cyberattacks.  

“The nation’s reliance on cyber-enabled systems demands that the Department of Commerce, including the National Institute of Standards and Technology, deepen its critical role in protecting the nation from cybersecurity threats and vulnerabilities, with funding that matches the seriousness of the threat,” the Senators wrote. “The President’s Budget Request to level-fund NIST cybersecurity programs, while requesting significant increases across the agency, is insufficient to meet the need.”

The FY 2022 President’s Budget Request for the DOC National Institute of Standards and Technology (NIST) includes flat funding for cybersecurity programs and no funds to implement two Wicker-Cantwell priority cybersecurity provisions from the 2021 National Defense Authorization Act (NDAA) – the HACKED Act and CYBER LEAP Act – to advance the cybersecurity workforce and promote cybersecurity prize challenges, respectively.

Yesterday, Wicker and Cantwell convened a hearing focused on cybersecurity threats to America’s critical energy infrastructure. 

Click here or read full letter below:

Dear Madam Secretary,

As a world leader in the digital economy, the United States—including its economic and national security—depends on secure and consistent access to information systems. Digital and connected technologies support individual and institutional financial transactions, enable critical infrastructure, underlie the navigation and communications systems in our vehicles and our phones, and provide Americans with direct access to their government. These digital systems convey significant amounts of data, including personally identifiable information and proprietary information, making their protection crucial to security and privacy. The nation’s reliance on cyber-enabled systems demands that the DOC, including the NIST, deepen its critical role in protecting the nation from cybersecurity threats and vulnerabilities, with funding that matches the seriousness of the threat. The President’s Budget Request to flat fund NIST cybersecurity programs, while requesting significant increases across the agency, is insufficient to meet the need.

Reliance on cyber-enabled systems provides an attractive target for U.S. adversaries and cybercriminals. Separate threat assessments by the Director of National Intelligence and the Department of Homeland Security ranked cyberattacks as an acute threat to government at all levels as well as to the private sector. Recent events highlight these risks and the importance of cybersecurity risk management. The SolarWinds attack, which infiltrated systems at multiple government agencies, exploited vulnerabilities in the software development supply chain.  Ransomware attacks—which have this year impacted U.S. beef production and fuel distribution—have increased by an estimated 300% this year, with the ongoing Kayesa attack affecting up to 1,500 businesses worldwide. As re-emphasized at a Senate Commerce, Science, and Transportation Committee hearing this week, a ransomware attack on Colonial Pipeline, one of the nation’s largest pipeline operators, led to gas shortages and panic buying in Washington D.C. and the Southeast United States. This attack not only impacted passenger drivers and freight haulers, but also threatened airlines and mass transit.

The Administration has correctly called for action, with the Department of Homeland Security issuing new requirements for U.S. pipeline operators and the Department of Justice moving to identify foreign hackers. DOC must also be part of the solution, given its already significant responsibilities. In September 2020, the U.S. Government Accountability Office identified the DOC as the lead agency for 49 of the 191 activities outlined in the 2018 National Cyber Strategy, more than any other federal agency. Among these activities, the NIST cybersecurity and privacy frameworks support the adoption of standards and best practices by industry, academia, and government institutions. In addition, NIST’s National Initiative for Cybersecurity Education supports universities, major corporations, the federal government, and others to develop the cybersecurity workforce of the future. 

Recent actions by the Administration and Congress, including legislation led by the Senate Commerce Committee, have further entrusted DOC with high-priority cybersecurity initiatives. In January, the Fiscal Year (FY) 2021 NDAA (P.L. 116-283) directed DOC to grow the cybersecurity workforce and to hold cybersecurity-relevant prize competitions. In May, the President’s Executive Order (E.O.) on Improving the Nation’s Cybersecurity (E.O. 14028) directed NIST to publish software supply chain security guidelines and take other actions to make the nation more cybersecure. In June, the Senate passed the United States Innovation and Competition Act (S. 1260), which would require DOC to address supply chain resiliency; offset small manufacturers’ cybersecurity protection costs via the Manufacturing Extension Partnership; help universities improve their cyber posture to promote research security; and incentivize domestic semiconductor manufacturing, which could support the availability of secure hardware. 

Given these emerging responsibilities, we were encouraged by your commitment to build on NIST cybersecurity efforts, as expressed during your confirmation process before the Senate Commerce Committee. We urge you to take swift action on this important work and to ensure that the full range of NIST cybersecurity activities is appropriately resourced, with a particular focus on the following areas:

(1)    Developing the Cybersecurity Workforce. As of 2019, there were 300,000 unfilled cybersecurity jobs in the United States.  DOC should swiftly and fully implement the cybersecurity workforce provisions from the HACKED Act, which passed as part of the FY 2021 NDAA after careful consideration within our committee.  The HACKED Act directed DOC to carry out the Regional Alliances and Multi-stakeholder Partnerships to Stimulate (RAMPS) program, an effort to attract and retain cybersecurity personnel through cooperation between educational institutions and industry.  DOC should also continue its existing cybersecurity workforce activities performed via the National Initiative for Cybersecurity Education.

(2)    Demonstrating New and Existing Cyber Capabilities. DOC should swiftly and fully implement the cybersecurity prize competitions directed by the CYBER LEAP Act, passed in FY 2021 NDAA after careful consideration within our committee.  These challenges will demonstrate the potential for systems that make cyberattacks economically unattractive, improve Federal agency response to cyberattacks, and increase the privacy, security, and safety on individuals while online.  DOC should also continue to support the National Cybersecurity Center of Excellence—a public-private partnership to create practical cybersecurity solutions. 

(3)    Ensuring Resilient Supply Chains. Consistent with the E.O. 14028, DOC should continue addressing cybersecurity supply chain risk, including by updating and, as appropriate, encouraging the adoption of software supply chain best practices.  Actions should include a prompt update to NIST Special Publication 800-161, Cyber Supply Chain Risk Management Practices for Systems and Organizations, and continued work on advancing trustworthy networks and infrastructure, including zero trust architectures.  Further, DOC should leverage its supply chain resilience activities—such as the sectoral reviews under E.O. 14017, the new supply chain task force, and the semiconductor incentives under the FY 2021 NDAA, as appropriate—to promote the availability of measurably secure hardware and software.

(4)    Addressing Emerging Technology.  DOC should leverage its significant research experience to address the cybersecurity challenges and opportunities from emerging technologies such as artificial intelligence, quantum technology, advanced communications, and the Internet of Things.  DOC should continue to support research within the Applied Cybersecurity Division, the Computer Science Division, and the Information Technology Laboratory, while expanding research in emerging areas, including interdisciplinary research and research between offices, to better prepare the United States for the effects of these technologies.  

Cybersecurity threats are growing and evolving, so the federal response must do so as well.  To ensure the safety and security of the American people and economy, DOC and NIST must be part of the solution.  We appreciate your shared interest in this critical mission.

Wicker Requests U.S. Attorney General Review Larry Nassar’s Prison Privileges

WASHINGTON – U.S. Sen. Roger Wicker, R-Miss., ranking member of the Senate Committee on Commerce, Science, and Transportation, today sent a letter requesting U.S. Attorney General Merrick Garland review the policies allowing federal inmates to use deposit accounts without having to comply with financial sentencing obligations. This follows the recent development about former U.S. Olympic Gymnastics doctor Larry Nassar’s failure to pay financial penalties, including restitution to abuse victims.

Click here or read the letter below:

Dear Attorney General Garland,

Larry Nassar committed reprehensive acts of sexual assault against hundreds of our nation’s most talented young women gymnasts, including at least one representing the United States at this year’s Olympic Games in Tokyo. Nassar is serving up to 175 years in prison after being convicted on multiple counts of child pornography and sexual assault.

The Bureau of Prisons allows federal inmates to maintain deposit accounts. I understand that Nassar has received deposits of thousands of dollars from friends and family while incarcerated in federal prison. My investigative staff discovered that Nassar also received two COVID-related federal stimulus checks totaling $2,000. These funds afford Nassar the opportunity to purchase special food items, phone calls, and a variety of entertainment options. Recent reporting shows he has spent more than $10,000 since entering prison.

Although the system administered by the Bureau of Prisons shields inmate deposit accounts from state court orders, Nassar has not complied with his federal financial sentencing obligations. Despite enjoying prison privileges, Nassar will reportedly fail to pay his special assessment of $5,300 within the prescribed time period in accordance with his plea agreement accepted by the U.S. District Court for the Western District of Michigan. Nassar also owes more than $57,000 in restitution to the victims of his heinous acts, an obligation that he has so far ignored.

Unfortunately, these facts give the appearance that the Department of Justice places greater importance on Nassar’s comfort than on collecting the debt he owes to his victims. This situation sends a troubling message about our justice system’s priorities, not only to the athletes he abused but to victims of sexual misconduct everywhere. Continuing to allow a sexual predator to maximize his comfort in prison while ignoring obligations he incurred as part of his sentencing adds grave insult to the injuries sustained by his victims and the entire U.S. Olympic community.

I implore you to review the policies that facilitate this egregious miscarriage of justice and encourage you to implement corrective action as quickly as possible. I appreciate your prompt and urgent attention to this matter.

Sincerely,  

For the Third Year in a Row, GSA IT Receives Award for Excellence in Sustainable Procurement of IT Products

GSA news releases - Wed, 07/28/2021 - 12:00am
  Award is given Annually by the Global Electronics Council WASHINGTON -- Today, the U.S. General Services Administration’s Office of GSA IT received the Electronic Product Environmental Assessment Tool (EPEAT) Award for excellence in sustainable procurement of IT products and services for the...

Chair Cantwell Demands Swift Action on Residential Elevator Hazards at Confirmation Hearing for Consumer Product Safety Commission Nominees

Questioning comes in wake of recent tragic death of a seven-year-old in North Carolina vacation rental

 

WASHINGTON, D.C.—  During today’s hearing to consider the nominations of commissioners to the Consumer Product Safety Commission (CPSC), U.S. Senator Maria Cantwell (D-WA), Chair of the Senate Commerce, Science, and Transportation Committee, called on the nominees to take long-needed action to fix the safety hazards of residential elevators.  In 2019, Sen. Cantwell issued a report highlighting the CPSC’s inaction following the deaths and serious injuries suffered by children in residential elevators.

 

“This is a deadly safety problem that both manufacturers and the CPSC have been aware of for years,” Sen. Cantwell said.  “What’s worse, there is a common-sense fix that has not been implemented.”  

 

CLICK HERE TO WATCH

 

Two weeks ago, after news reported the tragedy of a child who was killed when trapped in the gap between the doors of a residential elevator in his family’s North Carolina vacation home rental, Sen. Cantwell immediately wrote to CPSC Acting Director Adler calling for immediate action to address the ongoing safety issue. In response, the CPSC wrote vacation rental companies, urging them to implement safety measures “in the hopes that you will join us in ensuring that children are safe in rentals on your platform.”

 

“This is not an adequate response to this glaring safety problem,” Sen. Cantwell said, referring to the CPSC letter to rental agencies. “We need…to take immediate action on this. So I'd like to ask each of the nominees here. Will you make this a priority? And what steps do you think we need to do to present to correct this known hazard?”

 

Below is the transcript of that exchange: 

Mr. Hoehn-Saric: Thank you, Senator, for the question. Since 1981, approximately 4,600 injuries and I believe over 23 deaths have been associated with residential elevators. Clearly this is a problem. It's been a problem for a long time, and the agency has taken only limited action here, as you pointed out. I agree, and I commit to you, if confirmed, to work with the staff, work with my fellow Commissioners, to put together a plan and bring that back to you and your staff about how to best move forward to address this issue as quickly as possible.

Cantwell: Ms. Boyle.

Ms. Boyle: Thank you for the question, Senator. And I agree completely, that these tragic incidents are the type of thing that the agency needs to address more quickly and more comprehensively, and that we should use all of our authorities to do so. Currently, there is administrative litigation pending, and I think that it’s a good thing that the agency is looking to use that authority. There's mandatory rulemaking, that it's a potential option, including doing a better job at communicating to consumers of the risks. And so I think we have to use all of our authorities, and if we don't have sufficient authorities, to work with this committee to see what else we can do to make sure that we are able to respond more quickly when these things happen.

Cantwell: Thank you. Mr. Trumka.

Mr. Trumka: Thank you, Senator. The stories of injury and deaths caused by residential elevators, they're tragic, and as you pointed out, avoidable. I think it should absolutely be a priority, and I am very happy to work with you to make sure we get the best fix there.

Cantwell: Thank you. Well, I think as Commissioners, this is the judgment that we're asking people to make to protect the life and safety of particularly young children, which is a very big role for the Commission.

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