There was nothing unlawful or improper about Trump’s acceptance speech

By David B. Rivkin, Jr., and Lee A. Casey

30 August 2020 in The Hill

The talking heads and pundits attacking President Trump for giving his Republican National Convention acceptance speech from the White House lawn need to actually read the law. The Hatch Act is a precisely written statute — as is appropriate for a law that limits the indisputable First Amendment rights of federal workers — and it supports the president.

First and foremost, the Hatch Act explicitly exempts the president and vice president from its strictures. It defines “employee,” to which the Hatch Act’s restrictions apply, as someone “other than the President or Vice President.” This is constitutionally required because the president is a co-equal branch of the federal government and Congress can no more limit or restrain his political activities than he could limit theirs.

As a result, President Trump was entirely within his legal rights to give his acceptance speech from the South Lawn of the White House. And any members of the White House staff who may have assisted and supported the president on Thursday night also were in compliance with the Hatch Act.

Although the Hatch Act prohibits a wide swath of federal workers — including many of the individuals who work in the White House — from engaging in political activities while on duty or “in any room or building occupied,” the White House lawn is not such a room or building.  Had Congress intended to extend Hatch Act restrictions to entire government installations or compounds, it could and would have said so.

In addition, there is a further exemption from the relevant Hatch Act restrictions for White House staff members whose work and responsibilities continue beyond normal working hours and while on travel — which includes many if not most of them. These individuals are permitted to engage in political activities while on duty and in a federal room or building, as long as “the costs associated with that political activity are not paid for by money derived from the Treasury of the United States.” The president has stated that the Republican National Committee would be picking up the tab for his White House event (and the fireworks afterwards).

Similarly, the attacks on Secretary of State Mike Pompeo for delivering a convention speech from Jerusalem, endorsing President Trump’s reelection, are similarly misplaced based on these same provisions.  In addition to exempting senior White House staff from Hatch Act restrictions on political activities while on duty or in a federal building, Section 7324(b) of the Hatch Act also exempts federal officials who are confirmed by the Senate and who “determine[] policies to be pursued by the United States in relations with foreign powers or in the nationwide administration of Federal laws.” This language includes, at a minimum, the Secretary of State, the Attorney General, and other members of the president’s cabinet.  

Such officials cannot, of course, use their “official authority or influence” to affect an election’s result, but the State Department has made clear that Secretary Pompeo spoke in his private capacity from Israel, not as secretary. Consequently, his speech was entirely consistent with his legal and ethical responsibilities.

Indeed, to the extent that Secretary Pompeo’s critics claim that he has somehow acted unethically or improperly, even if not illegally, it is significant that Congress itself made clear, in the Hatch Act’s first section, that federal employees — which includes cabinet members — “should be encouraged to exercise fully, freely, and without fear of penalty or reprisal, and to the extent not expressly prohibited by law, their right to participate or to refrain from participating in the political processes of the Nation.” The Hatch Act is a technical law to be applied as far as it goes and no further.

Finally, using the White House as a campaigning site is far from unprecedented. Jimmy Carter is said to have coined the phrase “Rose Garden Campaign,” complaining in 1976 that President Ford was taking advantage of the White House as a backdrop for his campaign. Then, in 1980 — facing economic disaster, the Iran hostage crisis and candidate Ronald Reagan, President Carter fell into the same strategy. Of course, it is only fair to note that the Rose Garden strategy did not turn out well for either sitting president in 1976 or 1980. 

But, there was nothing unlawful or improper about Presidents Ford and Carter using the White House grounds to help their campaigns then, and there is nothing improper about President Trump using it now.  

David B. Rivkin Jr. and Lee A. Casey practice appellate and constitutional law in Washington. They served in the White House Counsel’s Office and Justice Department under Presidents Reagan and George H.W. Bush.

Source: https://thehill.com/opinion/judiciary/514192-there-was-nothing-unlawful-or-improper-about-trumps-acceptance-speech

Coronavirus, Contracts and the Constitution

By David B. Rivkin, Jr., and J. Michael Luttig

17 August 2020 in the Wall Street Journal

Plaintiff lawyers want insurance companies to absorb the cost to business of the Covid-19 pandemic—and they’ve had some early successes. A federal judge in Kansas City, Mo., last week allowed salon and restaurant owners to proceed with a lawsuit claiming that Covid shutdowns constituted “direct physical loss or damage” covered by business-interruption policies. California lawmakers introduced legislation in June that would establish a presumption that Covid-19 qualifies for such coverage.

Yet however sympathetic their clients, the lawyers’ efforts are unconstitutional and dangerous. They threaten to bankrupt the insurance industry, on which American businesses and consumers depend.

Most commercial policies include coverage for business interruption caused by physical damage to the business assets. If a car dealership suffers tornado damage to its roof, it can recover repair costs and losses incurred while the premises are closed. But disease isn’t “physical loss or damage,” as that phrase is ordinarily understood or typically intended in insurance contracts. Most such contracts expressly exclude such losses. That’s because losses associated with communicable diseases—like those from war or nuclear accident—aren’t insurable. The risks are unknowable, preventing the calculation of a premium sufficient to cover the losses if the event occurs.

As the Supreme Court observed in Los Angeles Department of Water and Power v. Manhart (1978), “drastic changes” in the legal rules governing insurance policies can “jeopardize the insurer’s solvency and, ultimately, the insureds’ benefits.” If the Kansas City lawsuit and hundreds like it succeed in redefining “direct physical loss” to include Covid-induced business closures, insurers would be forced to cover losses that were never underwritten. The industry has enough reserves to pay up to $800 billion for losses covered by home, auto and business policies. Uncovered Covid-19 losses are estimated in the trillions.

Fortunately, there are significant constitutional limits on the ability of either courts or legislatures to change private insurance contracts. The Constitution forbids the states to “impair the obligation of contracts.” As Chief Justice John Marshall observed in Ogden v. Saunders (1827), the power of contract impairment “had been used to such an excess by the state legislatures, as to break in upon the ordinary intercourse of society and destroy all confidence between man and man.” The effect was “not only to impair commercial intercourse and threaten the existence of credit, but to sap the morals of the people and destroy the sanctity of private faith.”

The Contracts Clause has been invoked less frequently since the ratification of the 14th Amendment, whose Due Process Clause has become the preferred vehicle for challenging state regulatory actions. But the justices made clear in Allied Structural Steel Co. v. Spannaus (1978) that it still “limits the power of a State to abridge existing contractual relationships.” In that case, Minnesota rewrote pensions, requiring an employer to pay $185,000 to nine employees who were terminated before their benefits vested under the company’s plan. The court struck down the law as a “severe” and “unreasonably conditioned” retroactive alteration of agreed-upon obligations. Sveen v. Melin (2018), another Minnesota case, upheld a state-mandated invalidation of life-insurance beneficiary designations on divorce—but only because the impairment of the parties’ contractual obligations was minimal. The policyholder could redesignate the former spouse and “reverse the effect of the . . . statute with the stroke of a pen.”

Even during the Depression, the high court was skeptical of state laws that impaired private contracts. Home Building & Loan Association v. Blaisdell (1934) upheld a state law that extended the time allowed for redeeming real property from foreclosure under existing mortgages, but only because the redemption extension was a reasonable temporary condition.

State legislatures that attempt to abridge commercial insurance contracts today may argue that they are meeting a Depression-caliber economic emergency. Yet although the court reaffirmed in Spannaus that states’ ability to impair contract obligations is greater during an emergency, it also held that such laws must be “tailored to the emergency that it is designed to meet” and impose only “reasonable” conditions. Legislative changes establishing liability for Covid-19 losses would completely abrogate existing contracts and impose immediate, permanently binding, ruinous contractual obligations that the parties specifically contracted not to cover. They would almost certainly be struck down under the Contracts Clause.

Federal efforts to impose new contracts on insurance companies would also be unlikely to survive a constitutional challenge. The Fifth Amendment’s Due Process Clause prohibits Congress from imposing retroactive liabilities that, as the court put it in Landgraf v. USI Film Productions (1994), “increase a party’s liability for past conduct, or impose new duties with respect to transactions already completed.” In Eastern Enterprises v. Apfel (1998), the court struck down a law imposing new pension liabilities on employers based on decades-old contracts. The justices couldn’t agree on a rationale for their ruling: A plurality saw it as an unconstitutional taking without just compensation. But in a concurring opinion, Justice Anthony Kennedy argued that it violated due process. He noted that political pressures tempt lawmakers “to use retroactive legislation as a means of retribution against unpopular groups or individuals.”

Businesses, especially small ones, have suffered terribly because of the Covid-19 virus. Many likely won’t survive. But shifting the burden to the insurance industry by either judicial rewriting or legislatively abrogating insurance contracts would be unconstitutional, especially since the losses have been largely caused by government decrees. Congress has already provided enormous financial assistance to American businesses—the appropriate means of compensating losses suffered from the government’s shutdown of the economy.

Because the litigation threat is existential, the insurance industry should do more than defend specific lawsuits. It should seek declaratory judgments now, establishing the limits of their potential liability. It also should work to convince federal and state lawmakers that they neither should nor constitutionally could abrogate and rewrite private insurance contracts.

Mr. Rivkin practices appellate and constitutional law in Washington. He served in the White House Counsel’s Office and Justice Department under Presidents Reagan and George H.W. Bush. Mr. Luttig was general counsel of the Boeing Co., 2006-20. He served as a judge on the Fourth U.S. Circuit Court of Appeals. 1991-2006.

Source: https://www.wsj.com/articles/coronavirus-contracts-and-the-constitution-11597705464

Madison Warned About ‘Sanctuary’ States

By David B. Rivkin Jr. and John S. Baker Jr.

Aug. 2, 2020, in the Wall Street Journal

President Trump met wide derision last month when he issued an executive order excluding illegal aliens from the census numbers used for apportioning House seats. “Persons means persons,” Thomas Wolf of the Brennan Center for Justice told a reporter. “Everyone must be counted.” But counting is different from allocating political power, and Mr. Trump has the better constitutional argument.

Section 2 of the 14th Amendment provides: “Representatives shall be apportioned among the several States according to their respective numbers, counting the whole number of persons in each State, excluding Indians not taxed.” This revises a provision in Article I that uses similar language but also includes the infamous Three Fifths Clause.

When voting on the latter provision, the Constitutional Convention used the term “number of inhabitants.” The Committee on Style shortened that to “numbers,” but that linguistic change was of no import. As Chief Justice Earl Warren noted in Powell v. McCormack (1969), the committee wasn’t authorized to make substantive changes to previously voted provisions. In Wesberry v. Sanders (1964), Justice Hugo Black wrote for the court that “the debates at the Convention make at least one fact abundantly clear: that . . . in allocating Congressmen, the number assigned to each State should be determined solely by the number of the State’s inhabitants.”

The administration argues that illegal aliens don’t qualify as inhabitants, and it’s right. The definition of “inhabitant” at the time of the Founding had an important political and economic context because of the legal responsibility of localities to care for the destitute under the 1601 Act for the Relief of the Poor. An inhabitant was a person who rightfully resided in a jurisdiction, contributing to and qualifying for available benefits. Like illegal aliens today, those whose presence was unlawful were not considered inhabitants and were subject to removal.

According to the 2018 Yale study, there are at least 16.7 million, and more likely around 22.1 million, illegal aliens in the U.S. The apportionment following the 2010 census yielded congressional districts containing roughly 710,000 people each. That means the illegal-alien population is the equivalent of around 30 districts, more than any state except California (53) or Texas (36).

States inflating census numbers has been a ever-present danger to the proper functioning of America’s federalist system. In Federalist No. 54, James Madison addressed what he called states’ “interest in exaggerating their inhabitants” to bolster their representation in Congress: “It is of great importance that the States should feel as little bias as possible, to swell or to reduce the amount of their numbers.”

Millions of illegal aliens are distributed disproportionately throughout the U.S., more than enough to cause shifts in apportionment of congressional seats, which also affect the Electoral College. In an example of the kind of swelling Madison warned about, some states and localities entice illegal aliens with “sanctuary” laws promising to shield them from federal law enforcement and provide them free health care and other benefits. In the years ahead, that could make the illegal alien population become larger and more concentrated in these states.

Yet this is not simply a blue vs. red state conflict over political power. Sanctuary state California will lose representatives if illegal aliens are excluded from apportionment, but so will Texas and Florida. It is also a Sun Belt vs. Rust Belt conflict. States like Indiana, Michigan, Pennsylvania and Ohio are the ones that stand to gain (or at least not lose) in apportionment under the president’s plan.

Since only a few states lose representation after each decennial census, this gradual erosion of political power has rarely been challenged. The Supreme Court has never addressed the constitutionality of including illegal aliens in congressional apportionment and has only occasionally been asked to do so (including in a 2011 case in which we represented Louisiana). When the court rejected Mr. Trump’s proposed citizenship question on the census, it was on technical administrative procedure ground, not the merits.

That leaves it to the political branches to carry out the constitutional mandate of counting only inhabitants for reapportionment. Congress has done so, by enacting statutes giving the president wide discretion on reapportionment decisions. Mr. Trump is right to take the next step.

Mr. Rivkin practices appellate and constitutional law in Washington. He served in the White House Counsel’s Office and Justice Department under Presidents Reagan and George H.W. Bush. Mr. Baker is a visiting professor at Georgetown’s Center for the Constitution and a professor emeritus at Louisiana State University Law Center.

Source: https://www.wsj.com/articles/madison-warned-about-sanctuary-states-11596396761

A Way to Curb Chinese Intimidation

By David B. Rivkin Jr. and Anastasia Lin

July 13, 2020, in the Wall Street Journal

Facebook, Google and Twitter announced this month that they will refuse to comply with customer-information requests from Hong Kong authorities until the companies review the implications of a new Chinese security law designed to suppress dissent in the territory. If the tech companies don’t cave in, it will be a rare instance of Western businesses standing firm against Beijing’s intimidation.

Corporations typically kowtow, fearful of losing access to China’s massive market. International airlines, including American, Delta and United, changed their websites so that Taipei isn’t listed as being in Taiwan. The general manager of the National Basketball Association’s Houston Rockets apologized for tweeting an image that read “Fight for Freedom. Stand with Hong Kong.” Mercedes-Benz apologized for an English-language Instagram post that included an innocuous quote from the Dalai Lama. The Big Four accounting firms issued statements criticizing Hong Kong protests after some of their employees took out an ad supporting them.

Using its economic power to pressure Western corporations is a key element of Chinese statecraft. The Communist Party keenly appreciates that Western entities are far more credible than Chinese government or media. China scrutinizes statements by Western companies, focuses on those that are even mildly critical of its behavior, and threatens them on social media with economic retaliation and blacklisting.

Such threats often appear to emanate from private Chinese citizens. But given the government’s heavy censorship of Chinese social-media platforms, they inevitably bear the party’s imprimatur. Moreover, the Chinese government almost always backs up the statements attributed to its citizens, waging a joint campaign, so that the language of these “private” complaints tracks Communist Party propaganda.

Beijing also attempts to suppress authentic Chinese voices critical of its human-rights abuses. One of us (Ms. Lin) represented Canada in the Miss World 2016 finals in Washington. The London-based Miss World Organization—most of whose sponsors are Chinese companies—isolated her from the media during the pageant and threatened to disqualify her after she was seen speaking informally to a Boston Globe columnist. The ban on her contact with journalists was ameliorated only after intense public pressure.

It’s too much to expect corporations, whose objective is to make money for shareholders, to take a lonely stand against a government that controls access to a major market. But U.S. lawmakers could stiffen corporate spines. In response to the Arab League boycott of Israel, Congress in 1977 made it illegal for U.S. companies to cooperate with any unsanctioned foreign boycott and imposed civil and criminal penalties against violators. That legislation and the implementing regulations “have the effect of preventing U.S. firms from being used to implement foreign policies of other nations which run counter to U.S. policy,” according to the Commerce Department.

Antiboycott regulations forbid U.S. companies to “agree” to eschew doing business in Israel or with a company already blacklisted by the Arab League, or to cooperate with the boycott’s enforcement by providing information about business relationships with Israel or blacklisted companies. All requests for such cooperation must be reported to the Commerce Department. The regulations presume that any action taken in response to boycott-related requests violates the law. It isn’t sufficient to claim that one’s boycott-related speech or activity is based on one’s own views.

These regulations survived legal challenges from companies that claimed violations of their First Amendment right to free speech. Federal courts upheld the rules as narrowly tailored restrictions on commercial speech driven by a compelling government interest. American companies eventually grasped that the rules protected them from foreign pressure. In time, antiboycott compliance became part of American corporate culture and didn’t require much enforcement.

Beijing’s efforts to force American companies to support and comply with its propaganda and deception campaigns and furnish information on Chinese dissidents are similarly inimical to vital American interests. Preventing Western companies from participating in Chinese propaganda campaigns would diminish China’s soft power and impair its ability to use economic blackmail as a tool of statecraft.

Congress should enact legislation prohibiting American companies, as well as foreign entities doing business in the U.S., from cooperating with any Chinese effort to enlist them for propaganda or furnish information on dissidents. In particular, they would be barred from changing their public statements and social-media presence in response to Chinese pressure or from taking other steps to placate Beijing, whether its demands are communicated directly or indirectly. Any such Chinese demands would have to be reported to the U.S. government.

With most Americans—91%, according to a March Pew Research Center report—agreeing that Beijing threatens American interests, such legislation should be able to win bipartisan support. It would also be constitutionally defensible as a narrowly tailored regulation of commercial speech supported by a compelling government interest—countering Beijing’s push for global dominance.

The goal would not be to prevent companies from speaking, or to compel their speech, on China-related issues. They could not, however, legally comply with Chinese government attempts to direct their speech. Like the antiboycott laws, such a statute would protect Western companies, enabling them to tell Beijing that they are unable to comply with its demands. The U.S. can’t stop Chinese state institutions from spreading propaganda, but it can use the law to shield Western companies from the Communist Party’s intimidation.

Mr. Rivkin practices appellate and constitutional law in Washington. He served in the White House Counsel’s Office and Justice Department under Presidents Reagan and George H.W. Bush. Ms. Lin, an actress, was Miss World Canada 2015 and 2016. She is the Macdonald-Laurier Institute’s ambassador for China policy and a senior fellow at the Raoul Wallenberg Centre for Human Rights. She is the wife of James Taranto, the Journal’s editorial features editor.

Source: https://www.wsj.com/articles/a-way-to-curb-chinese-intimidation-11594680594

RFK vs. D.C. Statehood

By David B. Rivkin Jr. and Lee A. Casey

July 2, 2020, in the Wall Street Journal

Voting along party lines except for one Democratic dissent, the House last week approved a bill to grant statehood to almost all of the District of Columbia – and create two safe Democratic Senate seats in a city that typically votes 90% Democratic in presidential elections. But while Congress has the power to admit new states, changing the district’s status would require a constitutional amendment.

The Framers had good reason to put the capital outside the borders or control of any state. Attorney General Robert F. Kennedy, writing in opposition to a 1964 statehood bill, summed up their view: “It was indispensably necessary to the independence and the very existence of the new Federal Government to have a seat of government which was not subject to the jurisdiction or control of any State.”

In 1783, a mutinous band of Continental solders drove Congress out of Philadelphia after Pennsylvania’s government refused assistance. The recent protests and riots in Washington’s streets make it easy to imagine a similar clash if the federal government lacked sovereignty over the city. To prevent such a situation, the Constitution’s Framers wrote a provision giving Congress the power “to exercise exclusive legislation in all cases whatsoever, over such district (not exceeding ten miles square) as may, by cession of particular states, and the acceptance of Congress, become the seat of government of the United States.” Congress took over 100 square miles of Maryland and Virginia with the District of Columbia Organic Act of 1801.

In 1846, Congress retroceded Virginia’s portion, now Arlington County and a portion of the city of Alexandria. Was that constitutional? We think not. While the retrocession didn’t alter the configuration of the district in as fundamental a way as the House is now trying to do, the most logical reading of the Constitution is that no change in the district’s boundaries is permissible and that the original cession is irrevocable.

The Supreme Court has never ruled on the question. When it reached the justices, in Phillips v. Payne (1875), they dismissed the case, holding that the plaintiffs – taxpayers seeking reunion with the District of Columbia, which had lower taxes than Virginia – lacked standing. But if Congress approves statehood, other states would clearly have standing to challenge the dilution of their voting rights by the addition of two senators from an area ineligible for admission as a state.

The House bill attempts to hew to the Constitution’s design by excluding a small area of the district – including the White House, other federal buildings and the National Mall – and leave it as a federal district. RFK rejected a similar proposal in 1964: “A small Federal enclave comprised primarily of parks and Federal buildings … clearly does not meet the concept of ‘the permanent seat of government’ which the framers held.”

There’s an additional problem: The bill violates the 23rd Amendment, ratified in 1961, which enfranchised the district’s residents in presidential elections. The amendment allocates three electoral votes to “the district constituting the seat of government of the United States.” Under the House bill, that would not be the new state (which would get three electors of its own), but the rump federal district, which lots of structures but few or no inhabitants.

The bill provides for “expedited procedures” in both congressional chambers to propose an amendment repealing the 23rd. But doing so would require two-thirds majorities, and ratification needs approval from 38 state legislatures. That would require broad bipartisan cooperation – a tall order in today’s political climate, especially if one party sees an advantage in leaving the problem unsolved.

There are strong arguments for granting Washington residents representation in Congress. The Framers understood and were troubled by the undemocratic contradiction of denying capital residents the vote. Alexander Hamilton believed the federal district should have representation in the House but not the Senate (whose members were chosen by state legislatures until 1913). James Madison countered that the new capital’s residents would have an elected local government and “find sufficient inducement of interests to become willing parties to the cession” to justify their lack of congressional representation.

The District of Columbia has always been an imperfect solution to a constitutional problem. The debate over its role and status will and should continue. But abolishing the permanent seat of the federal government would be a profound change – the sort that can be accomplished only with a national consensus implemented through a constitutional amendment, not by a law pushed through for partisan advantage.

Messrs. Rivkin and Casey practice appellate and constitutional law in Washington. They served in the White House Counsel’s Office and Justice Department under Presidents Reagan and George H.W. Bush.

Source: https://www.wsj.com/articles/rfk-vs-d-c-statehood-11593709155

Lawsuits Needn’t Block Recovery

Congress has the power to limit coronavirus liability while regulators develop rules to control contagion.

By J. Michael Luttig and David B. Rivkin, Jr.

20 May 2020 in the Wall Street Journal

As Congress considers another Covid-19 rescue bill, the usual partisan divide has opened over limiting pandemic-related tort liabilities. Republicans and business owners argue that litigation will hamstring recovery. Trial lawyers, unions and Democrats counter that liability limits would encourage businesses to endanger employees and consumers. The Senate Republican leadership proposes immunity for all businesses that comply with public-health guidelines except in cases of “gross negligence” and willful misconduct.

Republicans’ approach is appealing in theory, but in practice it can’t be implemented without detailed regulatory standards—which in the case of Covid-19 won’t be written for some time. Rather than permanently change liability standards based on incomplete information about the virus, it would be wiser to enact an immediate but temporary immunity. That would permit the economy to begin reopening while allowing time for federal regulators to promulgate standards on which long-term immunity could be conditioned.

The existing tort liability system, which rests mostly on state statutory and common law, has few virtues and many flaws. It is inefficient and often arbitrarily imposes liability. Tort litigation, unlike regulatory standards and enforcement, is largely unconstrained by due process and other constitutional limits. The results can be crippling for small businesses, which can’t afford protracted litigation, and even large companies have to settle meritless or frivolous lawsuits. The system is driven by jackpot-justice incentives.

This system is particularly ill-equipped for dealing with Covid-19, which affects the whole economy. Yet hundreds of lawsuits are already pending against universities, processing plants, manufacturing, mass-transportation companies and other businesses. Plaintiff lawyers are petitioning legislatures to rewrite or courts to reinterpret insurance policies, which specifically exclude pandemic-related liabilities, in an effort to obtain large recoveries. While such efforts are constitutionally suspect, these lawsuits won’t die easily.

The notion that businesses will act recklessly if Congress affords liability relief ignores the good-faith compliance culture of American enterprises and the regulatory environment in which they operate. Businesses have strong incentives against even negligent behavior, which would cause bad publicity and customer distrust. We’ve seen many announcements in recent weeks about what businesses are doing to keep customers and employees safe. Bad actors can and will be held to account by states and municipalities using police and regulatory powers to fine, close or even prosecute those that operate dangerously. An elaborate system of federal and state workmen’s compensation provides additional protection.

Tort law is primarily a state matter, but it’s well-established that Congress can intervene via its power to regulate interstate commerce. Federal law has provided tort liability protections to firearms makers and for nuclear power. Congress also enacted laws to limit liabilities arising out of Y2K—like Covid-19, a specific event that was thought to have potentially calamitous economic consequences.

The Supreme Court has sustained congressional authority to sweep aside state policies, statutes and procedures that impair interstate commerce, beginning with Gibbons v. Ogden (1824), which affirmed federal pre-eminence in regulating interstate navigation. In New York v. Beretta (2008), which upheld the limitations on liability for firearms makers, the Second U.S. Circuit Court of Appeals held that Congress’s authority includes the power to ban state tort lawsuits that “are a direct threat” to specific industries.

While there are legitimate doubts—which we share—that the Commerce Clause’s original meaning encompasses intrastate economic activities, the high court has embraced this view since 1942, when it held in Wickard v. Filburn that the federal government could ban growing wheat for personal consumption because it impaired a wheat-production scheme created by federal statute. The justices also asserted in Gonzales v. Raich (2005) that the Commerce Clause allows Congress to regulate intrastate activities that “substantially affect interstate commerce.” Those precedents are enough to allow Congress to protect businesses with local footprints, such as beauty salons or restaurants, that buy products or supplies in interstate commerce.

Senate Republicans should also propose to make protection against tort liability a precondition for states and localities to receive nearly $1 trillion in the new Covid-19 rescue bill. In National Federation of Independent Business v. Sebelius (2012), the ObamaCare case, the Supreme Court limited Congress’s ability to coerce states into adopting new policies by threatening to withdraw money for existing programs. Since this money is new, that won’t pose an obstacle. Using its spending and Commerce Clause powers, Congress can promulgate a variety of regulatory schemes that would replace current federal and state statutory and common-law liabilities for Covid-19 and that would survive litigation challenges.

Making liability protection work will require regulation to evolve along with scientific understanding of Covid-19. Current federal, state and local guidelines, including those published by the Centers for Disease Control and Prevention, are informed exclusively by medical considerations and do not reflect traditional regulatory criteria such as cost and feasibility of implementation, and are too ambiguous and inconclusive to be a proper basis for imposing or limiting Covid-19-related liabilities. New, industry-specific guidelines will have to be developed by agencies such as the Occupational Safety and Health Administration.

OSHA and other federal agencies have the expertise to evaluate scientific, practical and cost-effective standards governing operations of a wide range of businesses. What they need is new statutory authority to issue safe-harbor guidelines for businesses that pre-empt tort liability under state law. Companies and trade associations would work with OSHA and propose industry- or business-specific guidelines to the agency, such as for meat packing plants or package sorting facilities. OSHA would promptly review each proposal, make necessary modifications, and then issue it as an immediately effective regulation with the legal force to override lawsuit liability. Businesses that comply with these regulations can rest assured that they’ve met their legal obligations.

Such considered Covid-19 liability reform—temporary immunity while businesses reopen, followed by promulgation of comprehensive federal regulatory guidelines—would be constitutional and consistent with federalist values. It would protect public health while enabling a prompt and full economic recovery.

Mr. Luttig is a former general counsel of the Boeing Co. He served as a judge on the Fourth U.S. Circuit Court of Appeals, 1991-2006. Mr. Rivkin practices appellate and constitutional law in Washington. He served in the White House Counsel’s Office and Justice Department under Presidents Reagan and George H.W. Bush.

Source: https://www.wsj.com/articles/lawsuits-neednt-block-recovery-11589993211