Am. Apparel & Footwear Ass'n, Inc. v. Allen

Decision Date22 June 2022
Docket NumberCase No. 3:21-cv-1757-SI
Parties AMERICAN APPAREL & FOOTWEAR ASSOCIATION, INC.; Halloween Industry Association, Inc. ; Juvenile Products Manufacturers Association, Inc.; and The Toy Association, Inc., Plaintiffs, v. Patrick ALLEN, in his official capacity as Director of the Oregon Health Authority; and Ellen Rosenblum, in her official capacity as Attorney General for the State of Oregon, Defendants.
CourtU.S. District Court — District of Oregon

James T. McDermott and Dwain M. Clifford, McDermott Weaver Connelly Clifford llp, 1000 SW Broadway, Suite 960, Portland, OR, 97205. Of Attorneys for Plaintiffs.

Keith A. Ketterling, Steven C. Berman, and Megan K. Houlihan, Stoll Stoll Berne Lotking & Shlachter pc, 209 SW Oak Street, Suite 500, Portland, OR 97204. Special Assistant Attorneys General for Defendants.


Michael H. Simon, District Judge.

In 2015, the Oregon Legislature enacted the Toxic-Free Kids Act (TFK Act), Oregon Revised Statutes (ORS) §§ 431A.250 - 431A.280. Among other things, the TFK Act directs the Oregon Health Authority (OHA), a state agency, to establish and maintain a list of high priority chemicals of concern for children's health (HPCCCH) when used in children's products (the HPCCCH List) and to issue regulations implementing this law. The TFK Act also requires manufacturers of children's products (or their trade association) to provide biennial notices when a children's product that is sold or offered for sale in Oregon contains a chemical included on the HPCCCH List at or above a de minimis level. On or before the date on which a manufacturer of a children's product submits the third biennial notice required for a listed chemical present in a specified type of children's product, the TFK Act also requires that the manufacturer either: (a) remove or make a substitution for the listed chemical; or (b) request a waiver. In addition, an otherwise covered children's product containing a listed chemical is exempt from the law's "removal or substitution" requirement if all levels of listed chemicals in that product are at or below "allowable levels" for children's products established under federal law and the manufacturer has submitted to the OHA appropriate documentation and fees for that exemption.

In this lawsuit, Plaintiffs are four trade associations that represent manufacturers of children's products. Plaintiffs also are members of the "Safe to Play Coalition," a coalition of trade associations representing makers of apparel, toys, crafts, juvenile products, and Halloween items. Plaintiffs seek declaratory and injunctive relief against two officers of the State of Oregon being sued in their official capacities. Plaintiffs ask the Court to enjoin both the Director of the OHA and the Oregon Attorney General from enforcing a portion of the TFK Act and two of its implementing regulations. Plaintiffs contend that the challenged portion of the TFK Act and the two challenged regulations are expressly preempted by federal law, specifically the Federal Hazardous Substances Act (FHSA), 15 U.S.C. §§ 1261 - 1278a, and the Consumer Product Safety Act (CPSA), 15 U.S.C. §§ 2051 - 2089. Plaintiffs argue that the FHSA or the CPSA, either separately or in combination, expressly preempt the challenged state law. Plaintiffs do not assert the doctrine of implied preemption, in any of its forms. Plaintiffs bring only an express preemption challenge to the contested state provisions. Plaintiffs do not argue that either the challenged portion of the TFK Act or the challenged regulations are preempted "as applied."

The parties have filed two related motions. First, Defendants move to dismiss Plaintiffs’ counts to the extent they are based on the FHSA. ECF 33. Second, Plaintiffs move for summary judgment, asking the Court to declare that the challenged portion of the TFK Act and the two challenged regulations are expressly preempted by federal law and to enjoin Defendants from enforcing the challenged provisions. ECF 47. For the reasons explained below, the Court grants Defendantsmotion to dismiss and denies Plaintiffsmotion for summary judgment.

A. Motion to Dismiss

A motion to dismiss for failure to state a claim may be granted only when there is no cognizable legal theory to support the claim or when the complaint lacks sufficient factual allegations to state a facially plausible claim for relief. Shroyer v. New Cingular Wireless Servs., Inc. , 622 F.3d 1035, 1041 (9th Cir. 2010). In evaluating the sufficiency of a complaint's factual allegations, the court must accept as true all well-pleaded material facts alleged in the complaint and construe them in the light most favorable to the non-moving party. Wilson v. Hewlett-Packard Co. , 668 F.3d 1136, 1140 (9th Cir. 2012) ; Daniels-Hall v. Nat'l Educ. Ass'n , 629 F.3d 992, 998 (9th Cir. 2010). To be entitled to a presumption of truth, allegations in a complaint "may not simply recite the elements of a cause of action but must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively." Starr v. Baca , 652 F.3d 1202, 1216 (9th Cir. 2011). The court must draw all reasonable inferences from the factual allegations in favor of the plaintiff. Newcal Indus. v. Ikon Office Sol. , 513 F.3d 1038, 1043 n.2 (9th Cir. 2008). The court need not, however, credit a plaintiff's legal conclusions that are couched as factual allegations. Ashcroft v. Iqbal , 556 U.S. 662, 678-79, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).

A complaint must contain sufficient factual allegations to "plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing party to be subjected to the expense of discovery and continued litigation." Starr , 652 F.3d at 1216. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (citing Bell Atl. Corp. v. Twombly , 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully." Mashiri v. Epsten Grinnell & Howell , 845 F.3d 984, 988 (9th Cir. 2017) (quotation marks omitted).

B. Motion for Summary Judgment

A party is entitled to summary judgment if the "movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). The moving party has the burden of establishing the absence of a genuine dispute of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The court must view the evidence in the light most favorable to the non-movant and draw all reasonable inferences in the non-movant's favor. Clicks Billiards Inc. v. Sixshooters Inc. , 251 F.3d 1252, 1257 (9th Cir. 2001). Although "[c]redibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge ... ruling on a motion for summary judgment," the "mere existence of a scintilla of evidence in support of the plaintiff's position [is] insufficient ...." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 252, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (citation and quotation marks omitted).

A. Federal Hazardous Substances Act

In 1960, Congress passed the Hazardous Substances Labeling Act "[t]o regulate the interstate distribution and sale of packages of hazardous substances intended or suitable for household use." Pub. L. 86-613, 74 Stat. 372 (July 12, 1960) (codified at 15 U.S.C. §§ 1261 et seq. ). As originally enacted, this law "was essentially a labeling law and applied only to products packaged in containers intended for household use." Riegel Textile Corp. v. Celanese Corp. , 649 F.2d 894, 898 (2d Cir. 1981). "The Act defined certain categories of ‘hazardous substances’ and then prohibited their delivery and receipt in interstate commerce if ‘misbranded’; i.e. , if they did not carry an appropriate warning label. Administration of the Act was vested in the Secretary of Health, Education and Welfare." Id.

In 1966, Congress enacted the Child Protection Act of 1966. This law removed the word "Labeling" from the title of the Hazardous Substances Labeling Act, resulting in the current title becoming the "Federal Hazardous Substances Act." Id. In addition, the law amended the FHSA "to ban hazardous toys and articles intended for children, and other articles so hazardous as to be dangerous in the household regardless of labeling, and to apply to unpackaged articles intended for household use, and for other purposes." Pub. Law 89-756, 80 Stat. 1303 (November 3, 1966). The 1966 amendments extended the coverage of the FHSA to include any hazardous substance intended for household use or use by children and permitted the responsible agency to ban from interstate commerce products that were so dangerous that no warnings could make the product safe for use. Riegel Textile , 649 F.2d at 898.

Three years later, Congress further amended the FHSA in the Child Protection and Toy Safety Act of 1969. These amendments "were designed to provide protection to children from toys and other articles which are hazardous due to the presence of electrical, mechanical or thermal hazards. The 1969 amendments added a section requiring the repurchase of ‘banned hazardous substances’ by manufacturers, distributors and dealers, including retailers." Id.

In its current form, the FHSA prohibits "[t]he...

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