Part 11- Regulation of Business, Chapter 47: Administrative Law, Doc 1

Key Points: 1. FDA and Tobacco Regulation: o The FDA attempted to regulate tobacco advertising in the mid-1990s, arguing that nicotine was a drug and cigarettes a drug-delivery device under the Food, Drug, and Cosmetic Act. o Tobacco companies challenged these regulations, arguing that Congress had not given the FDA authority over tobacco, and the advertising restrictions violated the First Amendment. o In FDA v. Brown & Williamson Tobacco Corp. (2000), the U.S. Supreme Court ruled that Congress did not intend for the FDA to regulate tobacco, thereby invalidating the FDA’s advertising restrictions. o However, Congress later amended the laws, explicitly granting the FDA authority to regulate tobacco. This illustrates the fluid nature of administrative agency powers, which can be expanded or restricted depending on congressional action. 2. Role of Administrative Agencies: o Administrative agencies, often referred to as the "fourth branch" of government, play a crucial role in regulation. They have powers akin to those of the legislative, executive, and judicial branches, including the ability to make rules (legislative), enforce them (executive), and adjudicate disputes (judicial). o The expansion of federal regulation since the 19th century has been driven by the need to address complex societal and technological challenges, such as the regulation of railroads, telecommunications, and environmental protection. 3. Controversies and Ethical Questions: o Agencies, such as the FDA, face ethical dilemmas in balancing public health benefits against potential harms. The approval and regulation of drugs, for example, raise questions about how much risk is acceptable in pursuit of medical advancements. o Issues like the Vioxx scandal, where a drug linked to heart attacks was withdrawn after being widely prescribed, underscore the ethical dimensions of regulatory oversight. 4. Enabling Legislation: o Administrative agencies are created through enabling legislation, which defines the agency's scope, powers, and responsibilities. The Federal Trade Commission Act is an example, giving the FTC authority to prevent unfair trade practices and outlining its investigative and adjudicatory powers. o While agencies are given significant power, their regulations must stay within the boundaries set by Congress. Overstepping these boundaries can lead to judicial challenges. 5. The Growth of Administrative Agencies: The rise of industrialization and new technologies in the late 19th century necessitated the creation of specialized regulatory bodies, like the Interstate Commerce Commission (1887), the Federal Trade Commission, and the Environmental Protection Agency. o Congress has also expanded existing agencies when needed, as seen in the Consumer Product Safety Commission’s role in regulating lead in imported toys after new concerns arose in 2008. 6. Legal Frameworks: o Enabling legislation serves as the foundation for an agency’s actions, defining its legal authority and operational scope. o Courts play a role in reviewing agency actions, particularly when regulations or decisions are challenged on constitutional grounds, as with the FDA’s tobacco regulations. o Learning Objectives: The chapter sets out to explain the role of enabling legislation in defining the legal authority of agencies, the constitutional limitations on their actions, the powers they possess (rulemaking, adjudication, investigation), and the various controls that Congress and the President may exert over them. Key areas of focus include standing to challenge agency decisions, judicial reviews of agency actions, and the Freedom of Information Act. Overall, this section highlights the evolving role of administrative agencies, their regulatory powers, and the legal and ethical considerations that influence their actions.