Week in Review

IN THE NEWS

• The government shutdown continued into its fourth week. Over 42,000 active-duty service members in the U.S. Coast Guard did not receive their first paycheck because the Coast Guard is funded through the U.S. Department of Homeland Security rather than the U.S. Department of Defense. The Internal Revenue Service instructed approximately 36,000 furloughed workers to return without pay to ensure that tax refunds will be processed. In addition, President Donald J. Trump signed legislation requiring back pay for all government workers when funding becomes available—even those workers not required to work during the shutdown.
• The U.S. District Court for the Southern District of New York ruled that the U.S. Department of Commerce’s attempt to add a citizenship question to the 2020 census violated the Administrative Procedure Act. Judge Jesse M. Furman found that Secretary of Commerce Wilbur Ross “concealed” the true purpose of the census question and also “badly misconstrued” evidence, “acted irrationally,” and “failed to justify significant departures from past policies and practices” of the Commerce Department. New York Attorney General Leticia James, who called the census question an attempt to “undermine” immigrant communities, said that Judge Furman’s ruling was a “win for New Yorkers and Americans.”
• The U.S. Supreme Court denied a petition to hear a case challenging the constitutionality of the Consumer Financial Protection Bureau’s (CFPB) structure. The U.S. Court of Appeals for the D.C. Circuit had previously affirmed that the CFPB’s structure as an independent agency was constitutional. Sam Kazman, general counsel for the Competitive Enterprise Institute, stated that he was “disappointed” by the decision but noted that “there are other pending lawsuits that raise these same issues.”
• In a 432–202 vote, the House of Commons of the Parliament of the United Kingdom (UK) rejected Prime Minister Theresa May’s proposed “Brexit” plan to withdraw the United Kingdom from the European Union. The United Kingdom now must decide whether to re-negotiate a deal to withdraw from the European Union, exit without a formal agreement, or develop another course of action. Separately, May survived a vote of no confidence raised against her government by the Labour opposition after the failed Brexit vote, 325–306.
• President Trump signed into law the Nuclear Energy Innovation and Modernization Act, which would reduce the length of time required to license new nuclear reactors—which currently takes 42 months—and streamline the process to dispose of uranium. U.S. Senator Mike Crapo (R-Idaho) praised the legislation as a “bipartisan measure” that would support the development of “modern, clean and efficient energy.”
• The Office of Inspector General of the U.S. General Services Administration issued a report stating that the agency erred in not considering constitutional issues when allowing President Trump to keep the lease on the Trump International Hotel in Washington, D.C. The agency recognized that President Trump’s interest in the hotel lease “raised issues under the Constitution’s Emoluments Clause”—forbidding the President from receiving benefits from foreign states—and that the decision to not consider these issues was “improper.”
• The U.S. Department of Transportation issued a draft notice of proposed rulemaking that would allow certain drones to fly at night and maneuver over people without first needing to obtain a waiver from the U.S. Federal Aviation Administration. Secretary of Transportation Elaine L. Chao stated the changes would “help communities reap the considerable economic benefits of this growing industry” and emphasized that they would not compromise safety. Robert Garbett, chief executive at Drone Major Group, reportedly stated that certain locations such as concerts and airports would still require “tailored defense strategies” against security threats posed by drones.
• In his confirmation hearing, U.S. Attorney General nominee William Barr testified about his attitudes on Special Counsel Robert Mueller’s investigation into Russian interference and about regulatory enforcement issues before the U.S. Senate Committee on the Judiciary. “I don’t believe Mr. Mueller would be involved in a witch hunt,” Barr said. He also fielded questions about the federal ban on marijuana, border security measures, and changes to asylum law.
• An Alabama state judge declared void a state law blocking local governments from removing historical monuments. Jefferson County Circuit Judge Michael Graffeo stated that the law infringed on the city of Birmingham’s free speech rights, as the city was powerless to remove Confederate monuments that “repulsed” an “overwhelming majority” of the city. State Senator Gerald Allen (R) reportedly stated that the law was intended to “thoughtfully preserve the entire story of Alabama’s history,” and he expressed confidence in the constitutionality of the law.

WHAT WE’RE READING THIS WEEK

• Brexit may have significant effects on the regulation of broadcasting in the UK, wrote Daithí Mac Síthigh, Professor of Law and Innovation at Queen’s University Belfast, in an article for Communications Law. Mac Síthigh observed that the United Kingdom is the “preferred place of establishment for international broadcasters operating” across the European Union, as by law these broadcasters only have to comply with UK regulations. Brexit, however, would force broadcasters established in the United Kingdom to adhere to each EU state’s broadcasting regulations. Mac Síthigh saw no clear solution but noted that the parties could retain the status quo through mutual recognition—permitting broadcasters to broadcast across the European Union while only abiding by UK regulatory standards.
• A “regulatory dead zone” may delay generic drug manufacturers seeking approval of synthetic insulin, argued Andrew Dunn in a recent article for Biopharma Dive. The regulatory approval process at the U.S. Food and Drug Administration is scheduled to change in March 2020, wrote Dunn, which means that drugs submitted through the current process that are not approved by the changeover date will “have to withdraw and start over” when the new process takes effect. To reduce costs, manufacturers may simply wait until 2020 to apply for approval, which would delay the availability of lower-cost insulin alternatives for consumers, Dunn concluded.
• Proposals to regulate the ability of companies to allocate greater shareholder voting power to their founders or insiders are “misguided,” wrote Jill Fisch of the University of Pennsylvania Law School and Steven Solomon of the University of California, Berkeley School of Law in an article forthcoming in the Boston University Law Review. Although some observers believe that these so-called dual class stock structures reduce the accountability of corporate insiders, Fisch and Solomon suggested that “investors and the market do not know enough” about the effects of such structures to justify their regulation. Instead, Fisch and Solomon advocated for a self-regulatory approach to keeping issuers of dual class stock accountable.