TASK
The Department of Energy (DOE) issued a subpoena requesting information regarding purchases, sales, exchanges, and other transactions in crude oil from
Phoenix Petroleum Company (Phoenix). The aim of the DOE audit was to uncover violations of the Emergency Petroleum Allocation Act (EPAA), which provided for
summary, or expedited, enforcement of DOE decisions. However, after the subpoena was issued but before Phoenix had responded, the EPAA expired. The EPAA provided that:
The authority to promulgate and amend any regulation, or to issue any order under this Chapter shall expire at midnight September 30, 1981, but such expiration shall not affect any action or pending proceedings, administrative, civil or criminal action or proceeding, whether or not pending, based upon any act committed or liability incurred prior to such expiration date.
Using the summary enforcement provisions of the the subpoena. Phoenix argues that because the EPAA has expired, the DOE lacks the authority either to issue the
subpoena or to use the summary enforcement provisions. Is Phoenix correct? Why or why not?
7. Under the Communications Act, the Federal Communications Commission may not impose common carrier obligations on cable operators. A common carrier is one that “makes a public offering to provide [communica- tion facilities] whereby all members of the public who choose to employ such facilities may communicate or transmit.” In May 1976, the Commission issued rules requiring cable television systems of a designated size
(a) to develop a minimum twenty-channel capacity by
1986, (b) to make available on a first-come, nondiscrimi-
natory basis certain channels for access by third parties,
and (c) to furnish equipment and facilities for such
access. The purpose of these rules was to ensure public access to cable systems. Midwest Video Corporation claimed that the access rules exceeded the Commission’s
jurisdiction granted it by the Communications Act of 1934, because the rules infringe upon the cable systems’ journalistic freedom by in effect treating the cable opera- tors as “common carriers.” The Commission contended that its expansive mandate under the Communications Act to supervise and regulate broadcasting encompassed
the access rules. Did the Commission exceed its authority under the Act? Why or why not?
8. Congress enacted the National Traffic and Motor Vehi- cle Safety Act of 1966 (the Act) for the purpose of reducing the number of traffic accidents that result in death or personal injury. The Act directs the Secretary of Transportation to issue motor vehicle safety standards
in order to improve the design and safety features of cars. The Secretary has delegated authority to promulgate safety standards to the National Highway Traffic
Safety Administration (NHTSA) under the informal
ulemaking procedure of the APA. The Act also authorizes judicial review under the provisions of the Adminis- trative Procedure Act (APA) of all orders establishing,
amending, or revoking a Federal motor vehicle safety standard issued by the NHTSA.
Pursuant to the Act, the NHTSA issued Motor Vehicle Safety Standard 208, which required all cars made after September 1982 to be equipped with passive
restraints (either automatic seat belts or airbags). The
cost of implementing the standard was estimated to be
around $1 billion. However, early in 1981, due to
changes in economic circumstances and particularly due
to complaints from the automotive industry, the
NHTSA rescinded Standard 208. The NHTSA had origi-
nally assumed that car manufacturers would install air-
bags in 60 percent of new cars and passive seat belts in
40 percent. However, by 1981, it appeared that manufac-
turers were planning to install seat belts in 99 percent of
all new cars. Moreover, the majority of passive seatbelts
could be easily and permanently detached by consumers.
Therefore, the NHTSA felt that Standard 208 would not
result in any significant safety benefits.
State Farm Mutual Automobile Insurance Company
(State Farm) and the National Association of Independ-
ent Insurers (NAII) filed petitions in Federal court for
review of the NHTSA’s rescission of Standard 208. What
standard of review would apply to the rescission? Should
it be set aside? Explain.
9. David Diersen filed a complaint against the Chicago Car
Exchange (CCE), an automobile dealership, alleging that
the CCE fraudulently furnished him an inaccurate
odometer reading when it sold him a 1968 Dodge
Charger, in violation of the Vehicle Information and
Cost Savings Act (the Odometer Act or the Act). The
Odometer Act requires all persons transferring a motor
vehicle to give an accurate, written odometer reading to
the purchaser or recipient of the transferred vehicle.
Under the Act, those who disclose an inaccurate odome-
ter reading with the intent to defraud are subject to a
private cause of action by the purchaser and may be held
liable for treble damages or $1,500, whichever is greater.
The CCE had purchased the vehicle from Joseph Slaski,
who certified to the CCE that the mileage was approxi-
mately 22,600. The CCE did not suspect that the odome-
ter reading was inaccurate. After purchasing the vehicle,
Diersen conducted an extensive investigation and dis-
covered that the vehicle’s title documents previously
listed its mileage as 75,000. Before Diersen filed this law-
suit, the CCE offered to have Diersen return the car for
a complete refund. Diersen refused this offer and
decided instead to sue the CCE under the Act. The dis-
trict court granted the defendant’s motion for summary
judgment, relying upon a regulation promulgated by the
National Highway Traffic Safety Administration
(NHTSA) which purports to exempt vehicles that are at
least ten years old (such as the one Diersen purchased
from the CCE) from the Act’s odometer disclosure
requirements. Diersen then filed a motion for reconsid-
eration of the court’s summary judgment order, arguing
that the older-car exemption created by the NHTSA
lacked any basis in the Act and was therefore invalid.
Should Dierson’s motion for reconsideration be granted?
Explain.
10. The Public Company Accounting Oversight Board
(PCAOB) was created as part of a series of accounting reforms in the Sarbanes-Oxley Act of 2002. The PCAOB is a Government-created entity with expansive powers to govern an entire industry. Every accounting firm that audits public companies under the securities laws must register with the PCAOB, pay it an annual fee, and comply with its rules and oversight. The PCAOB may inspect registered firms, initiate formal investigations, and issue severe sanctions in its disciplinary proceedings. While the Securities and Exchange Commission (SEC) appoints PCAOB members and has oversight of the PCAOB, it cannot remove PCAOBmembers at will, but only “for good cause shown,” “in accordance with” specified procedures. The SEC Commissioners, in turn, cannot themselves be removed by the President except for “inefficiency, neglect of duty, or malfeasance in office.” Parties with standing have challenged the constitu- tionality of the Sarbanes-Oxley Act’s creation of the PCAOB because it conferred executive power on PCAOB members without subjecting them to Presidential control. Decision?
11. Present and former law review editors who were researching disciplinary systems and procedures at the military service academies for an article were denied access to case summaries of honor and ethics hearings, with personal references or other identifying information deleted, maintained in the United States Air Force Academy’s Honor and Ethics Code reading files. It was the Academy’s practice to post copies of such summaries on forty squadron bulletin boards throughout the Academy and to distribute copies to Academy faculty and administration officials. The editors brought an action under the Freedom of Information Act (FOIA) against the Department of the Air Force to compel disclosure of the case summaries. Which exemptions to FOIA are most applicable? Explain whether any of these exemptions would enable the Academy to withhold the
requested case summaries
