Docket No. S222314
Solus Industrial Innovations, LLC v. Superior Court
Filed 2/8/18
IN THE SUPREME COURT OF CALIFORNIA
SOLUS INDUSTRIAL
INNOVATIONS, LLC, et al.,
Petitioners,
S222314
v.
Ct.App. 4/3 G047661
THE SUPERIOR COURT OF ORANGE
COUNTY,
Orange County
Respondent;
Super. Ct. No. 30-2012-00581868
THE PEOPLE,
Real Party in Interest.
The Orange County District Attorney brought an action for civil penalties
under this state’s unfair competition law (UCL; Bus. & Prof. Code, § 17200) and
fair advertising law (FAL; id., § 17500) against an employer. The action alleged
the employer violated workplace safety standards established by the state
occupational safety and health law (Cal/OSHA; Lab. Code, § 6300 et seq.) and
attendant regulations. The employer contended, and the Court of Appeal
concluded, that the district attorney’s action was preempted by the federal
Occupational Safety and Health Act of 1970 (federal OSH Act; 29 U.S.C. § 651 et
seq.).
1
For the reasons set forth below, we conclude that the federal act does not
preempt unfair competition and consumer protection claims based on workplace
safety and health violations when, as in California, there is a state plan approved
by the federal Secretary of Labor. The district attorney’s use of UCL and FAL
causes of action does not encroach on a field fully occupied by federal law, nor
does it stand as an obstacle to the accomplishment of the federal objective of
ensuring a nationwide minimum standard of workplace protection. In addition,
the federal act’s structure and language do not reflect a clear purpose of Congress
to preempt such claims. Therefore, we reverse the judgment of the Court of
Appeal.
I. Background
A. Factual and procedural history
Our statement of facts and procedure is based largely on the opinion of the
Court of Appeal.
Solus Industrial Innovations, LLC (Solus) manufactures plastics at its
Orange County facility. In 2007, it installed at the facility an electric water heater
that was designed for residential use. In March 2009, the water heater exploded,
killing two employees.
The Division of Occupational Safety and Health1 investigated and
“determined the explosion had been caused by a failed safety valve and the lack of
‘any other suitable safety features on the heater’ due to ‘manipulation and
misuse.’ ” In an administrative proceeding, the agency charged Solus with five
1
The Division of Occupational Safety and Health (sometimes hereafter
Division) functions within the state Department of Industrial Relations.
Sometimes referred to as Cal/OSHA, the Division holds general authority to
enforce the state occupational safety and health law. (See p. 9, post.
2
violations of state occupational safety and health regulations. (Cal. Code Regs.,
tit. 8, § 467, subd. (a) [failure to provide a proper safety valve]; id., § 3328, subds.
(a) [permitting unsafe operation of machinery and equipment], (b) [improper
maintenance of machinery and equipment], (f) [failing to use good engineering
practices], (h) [permitting unqualified and untrained personnel to operate and
maintain machinery and equipment].) The Division also cited Solus with a willful
violation for failing to maintain the water heater in a safe condition.
In addition, because two employees had died and there was evidence of
violations of law, the Division forwarded the investigation results to the District
Attorney of Orange County. (See Lab. Code, § 6315, subd. (g).) In March 2012,
the district attorney filed criminal charges against Solus’s plant manager and its
maintenance supervisor for felony violations of Labor Code section 6425,
subdivision (a).
The district attorney also filed the present civil action against Solus. The
complaint alleged four causes of action, “all based on the same worker health and
safety standards placed at issue in the administrative proceedings.” Only two of
the causes of action are at issue here. One “allege[d] that Solus’s failure to
comply with workplace safety standards amount[ed] to an unlawful, unfair and
fraudulent business practice under Business and Professions Code section 17200,
and the district attorney request[ed] imposition of civil penalties as a consequence
of that practice, in the amount of up to $2,500 per day, per employee, for the
period from November 29, 2007, through March 19, 2009.” The second was a
claim that Solus “made numerous false and misleading representations concerning
its commitment to workplace safety and its compliance with all applicable
workplace safety standards, and as a result of those false and misleading
statements, Solus was allegedly able to retain employees and customers in
3
violation of Business and Professions Code section 17500.” The district attorney
requested imposition of civil penalties in the same amount for the same period.2
Solus demurred on the ground that the two causes of action were preempted
by the federal OSH Act. (29 U.S.C. § 651 et seq.) The trial court overruled the
demurrer. Solus challenged the order and the Court of Appeal summarily denied
Solus’s petition for writ of mandate. This court granted the petition for review
filed by the district attorney and transferred the matter back to the Court of Appeal
with directions to issue an order to show cause.
The Court of Appeal issued its order to show cause and concluded that the
federal OSH Act preempted the district attorney’s UCL and FAL claims. Its
conclusion was based in part on a misapprehension concerning the date that unfair
competition penalty provisions were enacted compared with the date the federal
Secretary of Labor approved California’s occupational safety and health plan.
This court granted review and transferred the matter back to the Court of Appeal
for reconsideration in light of former section 3370.1 of the Civil Code, a provision
enacted in 1972. As the Court of Appeal acknowledged in its second opinion, this
statute, which provided penalties for unfair competition, “was in effect when
California’s plan was approved” by the federal Secretary of Labor. The Court of
2
The other two causes of action were for: (1) recovery of civil penalties
under Labor Code section 6428 for “serious violations” of workplace safety
standards and (2) recovery of civil penalties under Labor Code section 6429 for
“willful violation” of workplace safety standards. The trial court sustained Solus’s
demurrer without leave to amend with respect to these claims. The Court of
Appeal summarily denied the district attorney’s petition for writ of mandate
challenging this order. This court granted review and transferred the matter back
to the Court of Appeal. In a separate opinion the Court of Appeal affirmed,
agreeing with the trial court that the district attorney lacked standing to bring those
two claims. (People v. Superior Court (Solus Industrial Innovations, LLC) (2014
224 Cal.App.4th 33.
4
Appeal nonetheless concluded that the UCL and FAL claims were preempted by
the federal statute. In its view, federal law preempted any state occupational
safety and health standard or method of enforcing such a standard that did not
appear in the California occupational safety and health plan submitted to and
approved by the federal Secretary of Labor.
This court granted the district attorney’s petition for review.
B. Relevant federal and state laws
1. Federal law
As explained below, the federal OSH Act (29 U.S.C. § 651 et seq.
provides that the federal Secretary of Labor shall adopt standards for occupational
safety and health, but federal law does not preempt state authority when (1) there
is no federal standard or (2) there is a state plan for occupational safety and health
that has been approved at the federal level.
It is settled that the purpose of the 1970 federal enactment was to supply a
nationwide floor of protection for workers. (29 U.S.C. § 651(b) [Congress’s intent
was “to assure so far as possible every working man and woman in the Nation safe
and healthful working conditions”]; United Air Lines, Inc. v. Occupational Safety
& Health Appeals Bd. (1982) 32 Cal.3d 762, 772 (United Air Lines) [the federal
act intended “to address the problem of uneven and inadequate state protection of
employee health and safety” and “establish a nationwide ‘floor’ of minimally
necessary safeguards”].
The federal OSH Act grants the federal Department of Labor the authority
to provide and enforce mandatory national standards. (29 U.S.C. § 651(b)(3); see
also id., § 655 [calling for promulgation of standards].) The federal Secretary of
Labor has delegated certain authority to the federal Occupational Safety and
Health Administration (hereafter sometimes federal OSHA) to adopt standards.
5
(Gade v. National Solid Wastes Management Ass’n (1992) 505 U.S. 88, 92 (Gade
(plur. opn. of O’Connor, J.).) If the Secretary of Labor has not promulgated a
federal standard with respect to an occupational safety or health issue, states may
supply their own standards. (29 U.S.C. § 667(a) [“Nothing in this chapter shall
prevent any State agency or court from asserting jurisdiction under State law over
any occupational safety or health issue with respect to which no standard is in
effect under section 655 of this title”].)3
3
Solus has identified several standards that it contends apply to the facts of
this case. (29 C.F.R. § 1910, subpts. H, M (2017); id., § 1910.147 (2017).
Section 1910, subpart H, entitled “Hazardous Materials,” concerns, in part, the
handling, storage, and use of compressed gas cylinders and tanks (29 C.F.R.
§§ 1910.101-1910.121 (2017)), but these provisions do not appear to have any
application to the allegations of the complaint, which assert that Solus removed a
water heater’s safety features to force it to operate beyond its capacity. Nor does
section 1910, subpart M, entitled “Compressed Gas and Compressed Air
Equipment,” which applies to “compressed air receivers, and other equipment
used in providing and utilizing compressed air for performing operations such as
cleaning, drilling, hoisting, and chipping” (29 C.F.R. § 1910.169(a) (2017)),
appear to apply to these allegations. Finally, the provisions of 29 Code of Federal
Regulations section 1910.147 (2017) set forth steps that must be taken to control
hazardous energy during maintenance of a machine, but it appears from the
complaint that the explosion occurred as workers arrived to address a problem,
before any maintenance procedures were undertaken.
Solus also cites federal OSHA’s general duty clause, which states that an
employer “(1) shall furnish . . . employment and a place of employment which are
free from recognized hazards that are causing or are likely to cause death or
serious physical harm to his employees.” (29 U.S.C. § 654(a).) However, the
standards to which 29 United States Code section 667, subdivision (a) refers are
those promulgated by the federal Secretary of Labor under 29 United States Code
section 655; the general duty clause is not such a “standard.”
Although we are skeptical that the cited standards apply here, we note that
the case has been litigated based on the view that a federal standard applies to the
allegations, and we will assume without deciding that there is a federal standard
relevant to the claims.
6
Moreover, even when there are federal standards on an issue relating to
occupational safety and health, a state may assume responsibility for developing
and enforcing state standards on such issues by developing and submitting to the
Secretary of Labor a plan to “preempt” federal standards. In a provision entitled
“Submission of State plan for development and enforcement of State standards to
preempt applicable Federal standards,” the federal OSH Act states: “Any State
which, at any time, desires to assume responsibility for development and
enforcement therein of occupational safety and health standards relating to any
occupational safety or health issue with respect to which a Federal standard has
been promulgated under section 655 of this title shall submit a State plan for the
development of such standards and their enforcement.” (29 U.S.C. § 667(b).
The Secretary of Labor is required to approve a state’s plan or any
modification of its plan if, in the Secretary’s judgment, a number of conditions are
met. (29 U.S.C. § 667(c).) First, approval is conditioned on the plan designating a
state agency or agencies to administer the plan throughout the state. (Id.,
§ 667(c)(1).) Second, approval is conditioned on the plan providing standards and
enforcement at least as effective as parallel federal standards. (Id., § 667(c)(2
[the state plan “provides for the development and enforcement of safety and health
standards relating to one or more safety or health issues, which standards (and the
enforcement of which standards) are or will be at least as effective in providing
safe and healthful employment and places of employment as the standards
promulgated under section 655 which relate to the same issues, and which
standards, when applicable to products which are distributed or used in interstate
commerce, are required by compelling local conditions and do not unduly burden
interstate commerce”].) Other conditions include that the state plan contain
satisfactory assurances that the designated administrative agency or agencies
“have or will have the legal authority and qualified personnel necessary for . . .
7
enforcement,” and that the state will devote adequate funds to administration and
enforcement. (Id., § 667(c)(4) & (5).) The Secretary must give adequate notice
and an opportunity for a hearing before rejecting a state plan. (Id., § 667(d).
The Secretary of Labor retains some ongoing authority over state plans.
For example, the Secretary must “make a continuing evaluation of the manner in
which each State having a plan . . . is carrying out such plan.” (29 U.S.C.
§ 667(f).) If the Secretary finds, after “due notice and opportunity for a hearing,”
that the state has failed to “comply substantially” with its plan, the Secretary “shall
notify the State agency of [the] withdrawal of approval of such plan . . . .” (Ibid.;
see also id., subd. (g) [judicial review of withdrawal of approval].) A federal
regulation adds that states must submit changes to their plans to the Secretary of
Labor for approval. (29 C.F.R. § 1953.4(d) (2017).
Finally, the federal OSH Act contains a broad savings clause: “Nothing in
this chapter shall be construed to supersede or in any manner affect any
workmen’s compensation law or to enlarge or diminish or affect in any other
manner the common law or statutory rights, duties, or liabilities of employers and
employees under any law with respect to injuries, diseases, or death of employees
arising out of, or in the course of, employment” (29 U.S.C. § 653(b)(4).
2. Cal/OSHA
Long before the federal enactment, California regulated occupational safety
and health. (United Air Lines, supra, 32 Cal.3d at p. 766.) As we have recounted:
“ ‘In 1913 . . . the Legislature enacted a . . . bill creating the Industrial Accident
Commission, and vested that body, inter alia, with broad authority to adopt
regulations relating to the safety and welfare of employees.’ ” (Ibid.) That
“ ‘broad authority to regulate safety in places of employment’ ” was transferred to
another body in 1945 and then, “[i]n 1973, as part of a comprehensive revision of
8
California’s occupational health and safety statutes in response to the Federal
Occupational Safety and Health Act of 1970, the [regulatory board] was
reconstituted . . . and the division of Occupational Safety and Health was
designated as the administrative entity.” (Ibid.
The 1973 legislation largely mirrored earlier state enactments. (Lab. Code,
§ 6300 et seq.; United Air Lines, supra, 32 Cal.3d at p. 767.) The declared
purpose was to permit California to “assume responsibility for development and
enforcement of occupational safety and health standards under a state plan
pursuant to [the federal enactment].” (Stats. 1973, ch. 993, § 107, pp. 1954-1955;
see United Air Lines, supra, 32 Cal.3d at p. 766; California Lab. Federation v.
Occupational Safety & Health Stds. Bd. (1990) 221 Cal.App.3d 1547, 1552 (Cal.
Labor Fed.).
The Department of Industrial Relations (Department) was assigned the
overall task of administering the state plan for “development and enforcement of
occupational safety and health standards” relating to issues covered by the federal
OSH Act standards (Lab. Code, § 50.7, subd. (a); see id., § 6302), and the state
plan was to be “consistent with the provisions of state law governing occupational
safety and health, including, but not limited to [Cal/OSHA legislation].” (Id.,
§ 50.7, subd. (a).) Within the Department, the Occupational Safety and Health
Standards Board (Board) has authority to adopt, amend, or repeal standards (id.,
§ 142.3), and the Board’s authority to adopt occupational safety and health
standards is exclusive. (Id., § 142.3, subd. (a)(1).) Also within the Department is
the Division of Occupational Safety and Health. The Division is required to study
federal standards, propose modifications of California standards to the Board,
evaluate proposed standards for the Board, and, on issues not covered by federal
standards, “maintain surveillance, determine the necessity for standards, [and]
develop and present proposed standards to the board.” (Id., § 147.1, subd. (c); see
9
id., subds. (a), (b), (d).) The Division also holds general enforcement powers over
any “place of employment.” (Id., § 6307, see also id., §§ 142, 6308.
The state law includes various enforcement and civil and criminal penalty
provisions. (See Lab. Code, §§ 6317 [citations, abatement, civil penalties], 6425
[criminal penalties for violations causing death or serious impairment], 6428 [civil
penalties for serious violations], 6429 [civil penalties for willful or repeated
violations]; 6430 [civil penalties for failure to correction violations].) State
regulations include those governing water heaters.
The Division’s authority over “places of employment” is not exclusive, and
does not include places “where the health and safety jurisdiction is vested by law
in, and actively exercised by, any state or federal agency other than the division.”
(Lab. Code, § 6303, subd. (a); see also United Air Lines, supra, 32 Cal.3d at
pp. 767, 770-771 [Lab. Code, § 6303, subd. (a) divests the division of jurisdiction
solely when another agency is under a mandate to provide for worker protection].
Cal/OSHA provisions also recognize some concurrent local entity jurisdiction.
(See Lab. Code, § 6316 [except as otherwise provided in Cal/OSHA, the
governing bodies of local government entities generally are not deprived of “any
power or jurisdiction over or relative to any place of employment”]; see id., § 144,
subds. (a) [authority of agencies other than the Division to “assist in the
administration or enforcement” of standards “shall be contained in a written
agreement with the Department . . . .”], (e) [no limitation on local agency authority
“as to any matter other than the enforcement of occupational safety and health
standards”]; Coyle v. Alland & Company, Inc. (1958) 158 Cal.App.2d 664, 669-
670.) Consistent with this concurrent jurisdiction, the Division’s Bureau of
Investigations ordinarily must forward its investigative results to local prosecutors
in cases of serious injury or death. (Lab. Code, § 6315, subds. (g), (i).
10
The Department submitted a Cal/OSHA plan to the federal Secretary of
Labor, and it was approved in May 1973. (29 C.F.R. § 1952.7(a) (2017).)4
Descriptions of the California plan and amendments that formerly appeared in
federal regulations (see 29 C.F.R. former § 1952.170 (1999)5 have been removed
by federal OSHA in an effort at streamlining. (Text removed by 80 Fed.Reg.
78977 (Dec. 18, 2015) (approving proposal of federal OSHA Aug. 18, 2015); 80
Fed.Reg. 49897 (Aug. 18, 2015) [“This document . . . amends OSHA regulations
to remove the detailed descriptions of State plan coverage, purely historical data,
4
The federal regulation provides: “(a) The California State plan received
initial approval on May 1, 1973. [¶] (b) [federal] OSHA entered into an
operational status agreement with California. [¶] (c) The plan covers all private-
sector employers and employees, with several notable exceptions, as well as State
and Local government employers and employees, within the State. For current
information on these exceptions and for additional details about the plan, please
visit [a federal Department of Labor website].” (29 C.F.R. § 1952.7 (2017).
The referenced website contains a very brief summary of the plan, noting
that the Division “implements the California State Plan’s enforcement . . . .”
(U.S. Dept. of Labor, OSHA Plans <http://www.osha.gov/dcsp/osp/stateprogs/
california.html> [as of February 8, 2018].
The referenced “operational status agreement” notes that the Division “is
designated as the state agency responsible for administering the State Plan,” that,
with certain limited exceptions, “concurrent federal enforcement authority was
suspended with regard to federal occupational safety and health standards in issues
covered by the State Plan,” and that “concurrent federal enforcement authority
would not be initiated with regard to any federal occupational safety and health
standards in issues covered by the State Plan.” (82 Fed.Reg. 25631 (June 2,
2017).
5
The former provision referred to enforcement by the Division, and noted
that then-existing state safety and health standards would be “continued unless
amended by a State occupational safety and health standards board to be created.”
(29 C.F.R. former § 1952.170(a) (1999).) It observed that the state plan “set out
goals” and acknowledged that certain enabling legislation was still to be enacted
by the state Legislature. (Id., former § 1952.170(e) (1999).
11
and other unnecessarily codified information . . . . The purpose of these revisions
is to eliminate the unnecessary codification of material in the Code of Federal
Regulations . . . .”].) There appears to be no dispute, however, that the Cal/OSHA
standards, the violation of which was the basis for the district attorney’s UCL and
FAL claims, were part of the approved California plan, nor does there appear to be
any dispute that use of UCL and FAL claims by local prosecutors pursuing civil
actions was not mentioned in the plan’s enforcement provisions. (See, e.g., Cal.
Code Regs., tit. 8, § 344.50 [Division of Occupational Safety and Health
compliance personnel conduct civil inspections and enforcement actions but lack
authority to initiate criminal proceedings].
Cal/OSHA standards have undergone revisions that were submitted for and
secured federal approval. For example, in response to a state court action by labor
representatives, the state Board amended the state standards to reflect the
requirements of the state’s then-newly adopted Safe Drinking Water and Toxic
Enforcement Act of 1986. (Health & Saf. Code § 25249.5 et seq.; see Cal. Labor
Federation, supra, 221 Cal.App.3d at pp. 1554, 1557-1559; see Dept. of Labor,
Supplement to California State Plan; Approval, 62 Fed.Reg. 31159 (June 6,
1997).
In 1987, the Governor of California attempted to reassign exclusive control
over occupational safety and health matters to the federal government. He notified
the federal Secretary of Labor of his intent and reduced the Department’s budget.
(See Cal. Labor Federation, supra, 221 Cal.App.3d at p. 1552.) The voters,
however, in 1988 approved a proposition that defeated the Governor’s plan and
affirmed the central role of state law in these matters. (Lab. Code, § 50.7, subd.
(a), enacted by Prop. 97, as approved by voters, Gen. Elec. (Nov. 8, 1988).) The
proposition’s preamble stated the enactment’s goal: “It is the purpose of this Act
to restore California control over private sector safety and health, which the state
12
has provided for since 1913, and has administered since 1973 through Cal/OSHA.
Pursuant to Article XIV, Section 4, of the California Constitution, state
jurisdiction over worker safety and health should not be limited, eliminated or
otherwise restricted, unless absolutely required by the federal Constitution.”
(Ballot Pamp. Gen. Elec. (Nov. 8, 1988) text of Prop. 97, p. 75.
C. General preemption principles
“ ‘The supremacy clause of the United States Constitution establishes a
constitutional choice-of-law rule, makes federal law paramount, and vests
Congress with the power to preempt state law.’ [Citations.] Similarly, federal
agencies, acting pursuant to authorization from Congress, can issue regulations
that override state requirements. [Citations.] Preemption is foremost a question of
congressional intent: did Congress, expressly or implicitly, seek to displace state
law?” (Quesada v. Herb Thyme Farms, Inc. (2015) 62 Cal.4th 298, 307-308
(Quesada).
We “conduct[] the search for congressional intent through the lens of a
presumption against preemption. [Citations.] The presumption is founded on
‘respect for the States as “independent sovereigns in our federal system” ’; that
respect requires courts ‘to assume that “Congress does not cavalierly pre-empt
state-law causes of action.” ’ [Citation.] The strength of the presumption is
heightened in areas where the subject matter has been the long-standing subject of
state regulation in the first instance; where federal law touches ‘a field that “ ‘has
been traditionally occupied by the States,’ ” ’ the party seeking to show
preemption ‘bear[s] the considerable burden of overcoming “the starting
presumption that Congress does not intend to supplant state law.” ’ ” (Quesada,
supra, 62 Cal.4th at pp. 312-313, see also id. at p. 315 [Rice v. Santa Fe Elevator
Corp. (1947) 331 U.S. 218, 230, which first recognized the assumption that the
13
historic police powers of the state are not superseded, remains good law].) The
presumption applies to the scope as well as the existence of preemption.
(Olszewski v. Scripps Health (2003) 30 Cal.4th 798, 815 (Olszewski); see also
Brown v. Mortensen (2011) 51 Cal.4th 1052, 1064.
“We have identified several species of preemption. Congress may
expressly preempt state law through an explicit preemption clause, or courts may
imply preemption under the field, conflict, or obstacle preemption doctrines.”
(Quesada, supra, 62 Cal.4th at p. 308.) Implied preemption, for its part, may be
found “(i) when it is clear that Congress intended, by comprehensive legislation, to
occupy the entire field of regulation, leaving no room for the states to supplement
federal law [citation]; (ii) when compliance with both federal and state regulations
is an impossibility [citation]; or (iii) when state law ‘stands as an obstacle to the
accomplishment and execution of the full purposes and objectives of Congress.’ ”
(Bronco Wine Co. v. Jolly (2004) 33 Cal.4th 943, 955, italics added; see also Farm
Raised Salmon Cases (2008) 42 Cal.4th 1077, 1087.) Because preemption
questions turn on Congressional intent, a reviewing court begins with the text of
the federal statute, “the source of the best evidence concerning the breadth of
Congress’s preemptive intent.” (Quesada, supra, 62 Cal.4th at p. 308.
D. Federal OSH Act preemption principles announced by the high
court
The United States Supreme Court examined the preemptive effect of the
federal OSH Act in Gade, supra, 505 U.S. 88. The high court’s plurality and
concurring opinions offer helpful interpretive guidance, but as explained below, in
Gade, there was no approved state plan, so the extent to which an approved state
plan displaces federal authority was not at issue.
In Gade, Illinois state laws imposed special requirements for persons
working with hazardous waste, including training and licensing requirements.
14
There was a federal occupational safety and health standard in effect concerning
training and certification of persons working with hazardous wastes. The stated
purpose of the Illinois laws was to “ ‘promote job safety’ ” and “ ‘protect life, limb
and property.’ ” (Gade, supra, 505 U.S. at p. 91 (plur. opn. of O’Connor, J.).
Two issues were raised by those laws. The first was whether, in the absence of an
approved state plan, the federal OSH Act preempted efforts by the state to
supplement the existing and applicable federal occupational safety and health
standards. The second issue was whether state statutes having an asserted dual
purpose of protecting public as well as worker safety would be preempted. A
majority of the court concluded that the state law was preempted, but there was
disagreement whether implied or express preemption was involved. (Id., at
pp. 91-109 (plur. opn. of O’Connor, J.); id., at pp. 109-114 (conc. opn. of
Kennedy, J.).
The high court’s plurality opinion used an implied preemption analysis.
The plurality found that when a federal occupational safety and health standard
exists and the state has not presented a plan to the Secretary of Labor and obtained
approval, the application of a state occupational safety and health standard would
be an obstacle to achieving Congress’s goal that only a single regime of
occupational safety and health regulation should apply. The plurality held that
“nonapproved state regulation of occupational safety and health issues for which a
federal standard is in effect is impliedly pre-empted as in conflict with the full
purposes and objectives of the OSH Act. [Citation.] The design of the statute
persuades us that Congress intended to subject employers and employees to only
one set of regulations, be it federal or state, and that the only way a State may
regulate a [federally]-regulated occupational safety and health issue is pursuant to
an approved state plan that displaces the federal standards.” (Gade, supra, 505
U.S. at pp. 98-99.
15
The plurality opinion relied on 29 United States Code section 667(b),
specifically the subdivision’s language directing that a state “shall” submit a plan
for federal approval if a state wishes to “assume responsibility” for development
and enforcement of occupational safety and health standards when a federal
standard already exists. (Gade, supra, 505 U.S. at p. 99.) “The unavoidable
implication of this provision is that a State may not enforce its own occupational
safety and health standards without obtaining the Secretary’s approval . . . .”
(Ibid.) In the plurality’s view, the federal OSH Act as a whole indicated that “a
State may develop an occupational safety and health program tailored to its own
needs, but only if it is willing completely to displace the applicable federal
regulations.” (Id., at p. 100, italics added.
The plurality opinion also pointed to 29 United States Code section 667(a
— which acknowledges the authority of states to exercise jurisdiction where there
is no federal standard — reasoning that the subdivision’s “preservation of state
authority in the absence of a federal standard presupposes a background pre-
emption of all state occupational safety and health standards whenever a federal
standard governing the same issue is in effect.” (Gade, supra, 505 U.S. at p. 100,
italics added.) And pointing to 29 United States Code section 667(c), which
establishes conditions for plan approval, the Gade decision observed that the
conditions would be nullified if states could simply adopt their own standards
without going through the approval process. (Id., at p. 100.
Subdivisions (f) and (h) of 29 United States Code section 667 also
confirmed the plurality’s view that states cannot act when there is no approved
state plan but a federal standard does exist. Because subdivision (f) of section 667
gave the federal Secretary of Labor the power to withdraw approval of a state
plan, the decision reasoned that “[o]nce approval is withdrawn, the plan ‘cease[s]
to be in effect’ and the State is permitted to assert jurisdiction under its
16
occupational health and safety law only for those cases ‘commenced before the
withdrawal of the plan.’ ” (Gade, supra, 505 U.S. at p. 101.) This language
“assumes that the State loses the power to enforce all of its occupational safety and
health standards once approval is withdrawn.” (Ibid.) And the plurality saw the
“same assumption of exclusive federal jurisdiction in the absence of an approved
state plan” in subdivision (h), which permits states to enter temporary agreements
to enforce their own laws in the two years following the passage of the federal
OSH Act. (Id., at pp. 101-102.
From these provisions, the plurality “conclude[d] that the OSH Act
precludes any state regulation of an occupational safety or health issue with
respect to which a federal standard has been established, unless a state plan has
been submitted and approved pursuant to [ 29 United States Code section 667](b).
Our review of the Act persuades us that Congress sought to promote occupational
safety and health while at the same time avoiding duplicative, and possibly
counterproductive, regulation. It thus established a system of uniform federal
occupational health and safety standards, but gave States the option of pre-empting
federal regulations by developing their own occupational safety and health
programs.” (Gade, supra, 505 US. at p. 102, italics added.
Addressing the separate question whether preemption — still in the absence
of an approved state plan — reached state laws that directly regulated occupational
safety and health but also were intended to protect public safety, the plurality
concluded that the preemptive effect of the federal law extended to such “dual
impact” state laws. (Gade, supra, 505 U.S. at pp. 104-105.) The state argued that
its laws, which imposed requirements regarding training, testing, and licensing of
crane and hazardous waste site workers, were intended to promote both public and
worker safety, and therefore should not be preempted. The plurality disagreed,
declaring that “dual impact state regulation cannot avoid OSH Act pre-emption
17
simply because the regulation serves several objectives rather than one.” (Id. at
p. 106.) Rather, “[w]hatever the purpose or purposes of the state law, pre-emption
analysis cannot ignore the effect of the challenged state action on the pre-empted
field. The key question is thus at what point the state regulation sufficiently
interferes with federal regulation that it should be deemed pre-empted . . . .” (Id.
at p. 107, italics added.) The decision concluded that state law that “ ‘constitutes,
in a direct, clear and substantial way, regulation of worker health and safety’ ”
would be preempted, whereas “state laws of general applicability (such as laws
regarding traffic safety or fire safety) that do not conflict with [federal] standards
and that regulate the conduct of workers and nonworkers alike would generally not
be pre-empted. Although some laws of general applicability may have a ‘direct
and substantial’ effect on worker safety, they cannot fairly be characterized as
‘occupational’ standards, because they regulate workers simply as members of the
general public.” (Ibid., italics added.
“In sum, a state law requirement that directly, substantially, and
specifically regulates occupational safety and health is an occupational safety and
health standard within the meaning of the [federal OSH] Act. . . . If the State
wishes to enact a dual impact law that regulates an occupational safety or health
issue for which a federal standard is in effect, . . . the Act requires that the State
submit a plan for the approval of the Secretary.” (Gade, supra, 505 U.S. at
pp. 107-108, italics added.
The concurring opinion by Justice Kennedy concluded that the federal law
expressly preempts state occupational safety and health standards when a federal
standard is in effect and the state has not submitted a plan for approval, but
vigorously opposed the plurality’s finding of implied preemption. (Gade, supra,
505 U.S. at pp. 109-114 (conc. opn. of Kennedy, J.).) In his view, the plurality’s
analysis failed to surmount the “high threshold” required for a finding that a law is
18
preempted because it conflicts with the purpose of a federal law. (Id. at p. 110.
He added that such preemption “should be limited to state laws which impose
prohibitions or obligations which are in direct contradiction to Congress’ primary
objectives, as conveyed with clarity in the federal legislation.” (Ibid.) The
concurrence observed no such direct contradiction between federal standards and a
“concurrent, supplementary state scheme.” (Ibid.) Rather, all the inferences from
29 United States Code section 667(b)’s express terms direct the preemption of
state occupational safety standards in the absence of a state plan approved by the
Secretary of Labor. Absent those express terms, Justice Kennedy “would not say
that state supplementary regulation conflicts with the purposes of the federal OSH
Act[] or that it ‘ “interferes with the methods by which the federal statute was
designed to reach [its] goal.” ’ [Citation.]” (Id. at p. 111.
According to the concurrence, the plurality opinion failed to comply with a
presumption that “ ‘historic police powers of the States’ ” are not preempted
“ ‘unless that was the clear and manifest purpose of Congress.’ ” (Gade, supra,
505 U.S. at p 111.) In addition, Justice Kennedy criticized the plurality’s method
of inferring the congressional purpose, saying that a “freewheeling judicial inquiry
into whether a state statute is in tension with federal objectives would undercut the
principle that it is Congress rather than the courts that pre-empts state law.” (Ibid.
Although Justice Kennedy disagreed with the plurality’s conclusion that
preemption was implied, he concluded that the plurality’s analysis “amply
demonstrates” express preemption. (Gade, supra, 505 U.S. at p. 112.) In his
view, although 29 United States Code section 667(b), which authorizes a state to
assume responsibility for occupational safety and health issues, lacked the “magic
words” of preemption (Gade, supra, 505 U.S. at p. 112), “[t]he statute is clear:
When a State desires to assume responsibility for an occupational safety and
health issue already addressed by the Federal Government, it must submit a state
19
plan. The most reasonable inference from this language is that when a State does
not submit and secure approval of a state plan, it may not enforce occupational
safety and health standards in that area.” (Id. at pp. 112-113 [also reading the
language of 29 U.S.C. 667(b) in conjunction with section 667(a), (c), and (f)].
Justice Kennedy found it unnecessary to “reiterate the plurality’s persuasive
discussion on this point.” (Gade, supra, 505 U.S. at p. 113.) The plurality
similarly observed that although the two opinions disagreed concerning the
category of preemption, they agreed on federal OSHA’s preemptive scope, based
on the language of 29 United States Code section 667. (Id. at p. 104, fn. 2.
II. Discussion
The Court of Appeal held that the UCL and FAL claims are preempted by
the federal OSH Act both expressly and through application of the principles of
implied preemption. It concluded that Congress has essentially occupied the entire
field of workplace safety regulation and enforcement other than workers’
compensation and the precise provisions of an approved state plan. It reasoned
that “[b]ecause the [federal] OSH Act allows a state to avoid federal preemption
only if it obtains federal approval of its own plan, it necessarily follows that a state
has no authority to enact and enforce laws governing workplace safety which fall
outside of that approved plan.” In its view, the district attorney’s use of UCL and
FAL actions based upon violations of approved Cal/OSHA standards was an
attempt to govern workplace safety without securing approval by the federal
Secretary of Labor.
As the Court of Appeal observed, the federal OSH Act expressly states
what is not preempted — state laws governing workers’ compensation, a broad
category of statutory and common law actions touching on worker safety, and any
occupational safety or health issue as to which there is no federal standard. (29
U.S.C. §§ 653(b)(4) [workers’ compensation and other laws related to worker
20
safety], 667(a) [no federal standard].) As the Court of Appeal’s analysis further
reflects, the federal OSH Act does not expressly describe what state regulation is
preempted. This omission does not preclude a finding of explicit preemption; as
Justice Kennedy noted in Gade, the high court has “never required any particular
magic words” to establish express preemption. (Gade, supra, 505 U.S. at p. 112.
But as illustrated by Justice Kennedy’s concurring opinion, when a court attempts
to discern from a statutory scheme the expression of an intent to displace state law,
the analysis may be substantially similar to an implied preemption analysis.
Therefore, we will first address whether preemption of the UCL and FAL claims is
implied. As will be seen, this analysis also resolves the issue of whether the
federal scheme explicitly preempts these claims.
A. No implied preemption of UCL and FAL claims
1. Field preemption
a. The field preempted is narrow
In enacting the federal OSH Act, Congress entered “a field that traditionally
had been occupied by the States. Federal regulation of the workplace was not
intended to be all encompassing, however.” (Gade, supra, 505 U.S. at p. 96 (plur.
opn. of O’Connor, J.); see United Air Lines, supra, 32 Cal.3d at p. 772 [“Despite a
broad authorization to [the federal OSH Act] . . . , the act did not foreclose other
federal agencies or states from exercising . . . jurisdiction” over occupational
safety and health].) Unlike some federal statutes, 29 United States Code section
667 does not employ broad language preempting all state regulation, laws, or
remedies relating to, concerning, or merely touching on the issue at hand, namely
occupational safety and health. (See, e.g., 21 U.S.C. § 360k(a) [except as
specifically provided, “no State . . . may establish or continue in effect with
respect to [medical devices] any requirement . . . different from, or in addition to,
21
any requirement [under the specific federal law]”; 29 U.S.C. § 1144(a) [ERISA
preempts “any and all State laws insofar as they may now or hereafter relate to any
employee benefit plan”]; 49 U.S.C. § 14501(c)(1) [“[A] State . . . may not enact or
enforce a law, regulation, or other provision having the force and effect of law
related to a price, route, or service of any motor carrier . . . with respect to the
transportation of property”]; id., § 41713(a)(4)(A) [“[A] State . . . may not enact or
enforce a law . . . related to a rate, route, or service of an air carrier”].
Moreover, various elements of the federal OSH Act convince us that the
preempted field is narrow. First, we have seen that when there is no federal
standard, there is no preemption. (29 U.S.C. § 667(a).) This provision
acknowledges that federal authority does not occupy the entire field. Rather,
states retain authority freely to apply their own law in the field of occupational
safety or health when the Secretary has not promulgated an applicable federal
standard.
Second, even when there are federal standards, states may “assume
responsibility for development and enforcement” of state occupational safety and
health standards, provided the state submits and gains approval for a state plan.
(29 U.S.C. § 667(b).) Under the terms of the statute, an approved state plan
“preempts” federal standards. (29 U.S.C. § 667(b) [entitled “Submission of State
plan for development and enforcement of State standards to preempt applicable
Federal standards”]; see also Gade, supra, 505 U.S. at p. 119 (dis. opn. of Souter,
J.) [this heading was “enacted as part of the statute and properly [may be]
considered under our canons of construction”].) In other words, once the state
plan is adopted and approved, state law has the effect of broadly preempting
parallel federal law. (See Gade, supra, 505 U.S. at pp. 96-97 (plur. opn. of
O’Connor, J.) [observing that 29 U.S.C. § 667(b) “gave the States the option of
pre-empting federal regulation entirely”]; United Air Lines, supra, 32 Cal.3d at
22
p. 772 [adoption of an approved plan “removes federal preemption so that the state
may exercise its own sovereign powers over occupational safety and health”].) In
addition, states can provide greater protection if they adopt their own plans with
standards and enforcement that are at least as protective as federal law. (29 U.S.C.
§ 667(c)(2).
We acknowledge that the Secretary of Labor has authority to approve
modifications to a state’s plan (29 U.S.C. § 667(c)) and “shall . . . make a
continuing evaluation of the manner in which each State having a plan . . . is
carrying out such plan.” (Id., § 667(f).) Notwithstanding these provisions, the
federal OSH Act as a whole does not suggest that the preempted field
encompasses all means of enforcement not specifically included in the state’s
approved plan. On the contrary, the federal OSH Act encourages states to
“assume the fullest responsibility for the administration and enforcement of their
occupational safety and health laws.” (29 U.S.C. § 651(b)(11).) In addition, it
directs that the Secretary “shall” approve a conforming state plan or modification,
and places administrative limits on the Secretary of Labor’s discretion to reject
state plans. (Id., § 667(d).) And as we have observed, once a state plan is
approved, it is federal, not state, law that must give way. (29 C.F.R. § 1953.3(a
(2017) [federal approval of a state plan “in effect removes the barrier of Federal
preemption, and permits the State to adopt and enforce State standards,” including
adopting and implementing modifications].) Finally, even if any new enforcement
method that is related to an existing approved standard should be submitted to the
Secretary — a question we need not answer — it does not follow that the new
method is preempted until approved. State modifications to an approved plan go
into effect immediately, subject to a review by the Secretary. (67 Fed.Reg. 60122
(Sept. 25, 2002); see also 62 Fed.Reg., supra, at p. 31165 [a modification “takes
effect prior to and pending OSHA review of the modification”].
23
Third, the federal OSH Act’s savings clause (29 U.S.C.§ 653(b)(4)) leads
us to infer a narrow field of implied preemption. That provision disclaims any
intent to interfere with state law in a broad domain affecting occupational safety
and health, whether or not there is an approved state plan. Specifically,
notwithstanding the existence of federal standards, not only are state workers’
compensation actions not preempted, but state tort claims and criminal
prosecutions also survive, although they may be based on duties established by
state occupational safety and health standards. (See Pedraza v. Shell Oil Co. (1st
Cir. 1991) 942 F.2d 48, 53-54, and cases cited [tort claims not preempted: “[W]e
find no warrant whatever for an interpretation which would preempt enforcement
in the workplace of private rights and remedies traditionally afforded by state laws
of general application”]; State v. Far West Water & Sewer (Ariz. 2010) 228 P.3d
909, 919, and cases cited [no preemption of prosecution under state criminal law
punishing conduct that is also governed by federal occupational safety and health
standards, the existence of some criminal penalties within the federal act itself
notwithstanding]; People v. Pymm (N.Y. 1990) 563 N.E.2d 1, 4 [referring to
“continued viability of State statutory and common-law duties”].) Indeed, section
653(b)(4) has been interpreted as a uniquely broad savings clause (In re Welding
Fume Products Liability Litigation (N.D.Ohio 2005) 364 F.Supp.2d 669, 687, &
fn. 21), and broad savings clauses may be seen as an indication that the field
preempted is narrow. (See Viva! Internat. Voice for Animals v. Adidas
Promotional Retail Operations, Inc. (2007) 41 Cal.4th 929, 944.
Finally, the provisions we have discussed indicate that the federal OSH Act
contemplates a cooperative system of workplace safety regulation, not an
exclusively federal one. When federal schemes involve cooperation and
concurrent jurisdiction, this circumstance also suggests that the scope of
preemption was not intended to be broad. (Olszewski, supra, 30 Cal.4th at p. 816
24
[“ ‘Where . . . coordinate state and federal efforts exist within a complementary
administrative framework, and in the pursuit of common purposes, the case for
federal pre-emption becomes a less persuasive one’ ”].
b. The UCL and FAL claims do not fall within this narrow field of
preemption
Laws of general application are not ordinarily preempted by the federal act.
(Gade, supra, 505 U.S. at p. 107 (plur. opn. of O’Connor, J.); id. at p. 114 (conc.
opn. of Kennedy, J.).) As explained below, under state law, actions under the
UCL or FAL are not considered to be a means of enforcing the law claimed to
have been violated; rather, they provide a remedy for economic damage suffered
as a result of violations of a wide array of other laws. Furthermore, to the extent
these claims may be a considered an enforcement mechanism with respect to the
state plan’s substantive standards, these claims merely supplement enforcement of
state standards. Federal OSHA’s provisions related to the enforcement of state
plans are concerned with ensuring enforcement that is at least as effective as the
federal standards; nothing in the federal act suggests a concern with enforcement
that exceeds federal requirements.
The UCL concerns unfair competition, a term that “mean[s] and include[s]
any unlawful, unfair or fraudulent business act or practice and unfair, deceptive,
untrue or misleading advertising and any act prohibited by [the false advertising
law].” (Bus. & Prof. Code, § 17200.) The purpose of the UCL “is to protect both
consumers and competitors by promoting fair competition in commercial markets
for goods and services.” (Kasky v. Nike, Inc. (2002) 27 Cal.4th 939, 949.) As we
have said, “the act provides an equitable means through which both public
prosecutors and private individuals can bring suit to prevent unfair business
practices and restore money or property to victims of these practices.” (Zhang v.
Superior Court (2013) 57 Cal.4th 364, 371, italics added.) The FAL, for its part,
25
makes actionable “untrue or misleading” statements made to “induce the public to
enter into any obligation” to purchase goods and services. (Bus. & Prof. Code,
§ 17500.) Actions to enforce the UCL or FAL, which may be brought by
government officials and by individuals who have suffered injury in fact (Bus. &
Prof. Code, § 17203), address the “ ‘ “overarching legislative concern . . . to
provide a streamlined procedure for the prevention of ongoing or threatened acts
of unfair competition.” [Citation.]’ ” (Zhang, supra, 57 Cal.4th at p. 371, italics
added.) And the remedies are “cumulative . . . to the remedies or penalties
available under all other laws of this state.” (Bus. & Prof. Code, § 17205.
As noted above, under state law, these actions are not considered on their
face to be a means of enforcing the underlying law. “ ‘By proscribing “any
unlawful” business practice, “[the UCL] ‘borrows’ violations of other laws and
treats them as unlawful practices” that the [UCL] makes independently actionable.
[Citations.]’ ” (Rose v. Bank of America, N.A. (2013) 57 Cal.4th 390, 396.) We
have explained that “by borrowing requirements from other statutes, the UCL does
not serve as a mere enforcement mechanism. It provides its own distinct and
limited equitable remedies for unlawful business practices, using other laws only
to define what is ‘unlawful.’ [Citation.] The UCL reflects the Legislature’s intent
to discourage business practices that confer unfair advantages in the marketplace
to the detriment of both consumers and law-abiding competitors.” (Id. at p. 397;
see People ex rel. Harris v. Pac Anchor Transportation, Inc. (2014) 59 Cal.4th
772, 783 [Federal Aviation Administration Act does not on its face preempt UCL
claims against motor carriers for misclassification of drivers]; In re Tobacco Cases
II (2007) 41 Cal.4th 1257, 1272 [a federal law governing cigarette sales to minors
on its face did not expressly preempt the UCL, which “is a law of general
application, and it is not based on concerns about smoking and health”]; Korea
Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1150; Cel-Tech
26
Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th
163, 180; Stop Youth Addiction, Inc. v. Lucky Stores, Inc. (1998) 17 Cal.4th 553,
560, 566 576.) Thus, the UCL and FAL are laws of general application.
We acknowledge that in some instances, a UCL claim may fall within a
field of preemption. For example, in In re Tobacco Cases II, supra, 41 Cal.4th
1257, a UCL claim based on advertising activities alleged to violate Penal Code
section 308 (prohibiting sale of tobacco products to minors and possession of such
products by minors) was preempted as applied under the particular terms of a
federal law governing cigarette labeling and advertising. (Id. at pp. 1272-1273.
Under the federal law involved, preemption turned on whether the particular UCL
claim would impose a duty necessarily and inherently based on concerns about
smoking and health. (Id. at p. 1273.) But here, the UCL and FAL claims are
based on standards set forth in an approved state plan, and which therefore
preempt any federal standards. Because these claims do not impose any duty on
employers that is subject to federal preemption, they do not come within the
principles articulated in Tobacco Cases II.
We also recognize that the federal OSH Act is concerned not only with a
state’s substantive standards, but also with its enforcement. (29 U.S.C. § 667(b) [a
state that wants to assume responsibility for “development and enforcement” of
standards must submit a state plan for “development of such standards and their
enforcement”].) Therefore, when UCL and FAL claims are premised on
violations of a state’s plan, the UCL and FAL arguably come within the high
court’s description of an occupational safety and health standard in the context of
the federal OSH Act: “a state law requirement that directly, substantially, and
specifically regulates occupational safety and health.” (Gade, supra, 505 U.S. at
pp. 107 (plur. opn. of O’Connor, J.); id. at p. 114 (conc. opn. of Kennedy, J.).
27
Notably, however, the federal OSH Act’s concern regarding enforcement is
only that states provide enforcement “at least as effective” as required under the
federal OSH Act. (29 U.S.C. § 667(c)(2); see 29 C.F.R. § 1902.3(d) (2017).) Its
focus on adequate enforcement, and its silence with respect to enforcement that is
more than adequate or is pursued through mechanisms other than those set forth in
a state’s plan, lead us to conclude that the federal OSH Act’s scheme is not “ ‘ “so
pervasive as to make reasonable the inference that Congress left no room for the
States to supplement it.” ’ ” (Gade, supra, 505 U.S. at p. 98 (plur. opn. of
O’Connor, J.).) California has provided adequate enforcement provisions through
its plan, and there is no “unavoidable implication” to be derived from the federal
OSH Act that where a state has met this federal requirement, Congress intended to
preclude supplemental enforcement of approved standards. (Id. at p. 99.
Our conclusion is consistent with the decision of the federal Department of
Labor approving California’s Hazard Communication Standard (Standard), which
incorporated provisions from Proposition 65, the Safe Drinking Water and Toxic
Enforcement Act. (Health & Saf. Code, §§ 25249.5 et seq.; 62 F.R. § 31159-01.
In addition to adopting the substantive standards of Proposition 65, “the
Cal/OSHA standard incorporate[d] the enforcement mechanism of Proposition 65,
which provides for supplemental judicial enforcement by allowing the State
Attorney General, district attorneys, city attorneys, city prosecutors, or ‘any person
in the public interest’ to file civil lawsuits against alleged violators.” (62
Fed.Reg., supra, at p. 31161.) Some comments regarding the proposed Standard
contended that Proposition 65’s private right of action violated the federal
requirement that an agency be designated to enforce the state plan. The Board’s
decision noted that “[i]f a State standard is not identical to Federal standards, the
State standard (and its enforcement) must be at least as effective as the comparable
Federal standard.” (62 Fed.Reg, supra,. at p. 31160.) It also observed, “Although
28
[the federal OSH Act] does not authorize private enforcement, OSHA State plans
do not operate under a delegation of Federal authority but under a system which
allows them to enact and enforce their own laws and standards under State
authority. Therefore, nothing in the Act prevents States with approved plans from
legislating such a supplemental private right of action in their own programs. . . .
[¶] In the case of Proposition 65, private enforcement is supplemental to, not a
substitute for, enforcement by Cal/OSHA. Private enforcement, therefore, should
not detract from Cal/OSHA’s responsibilities to enforce State standards.” (Id.,
p. 31167.
The federal Department’s consideration of Proposition 65 occurred in the
context of an approval of a plan amendment, but Congress has not specified (as it
has elsewhere) that any amendments to the state plan — even as to substantive
standards — must be submitted to the Secretary of Labor for approval before they
are implemented. (See, e.g., 7 U.S.C. § 6507(c)(2) [in context of changes to
federally-approved supplemental state requirements for organic food certification,
governing state official, “prior to implementing any substantive change to
programs approved under this subsection, shall submit such change to the
Secretary for approval”].) In addition, as explained above, the federal OSH Act’s
provisions related to the authority of the Secretary of Labor to approve
modifications to a state plan and to evaluate a state’s execution of its plan
(29 U.S.C. § 667(c), (f)) raise the potential that a modification may be rejected or
that approval of a plan may be withdrawn, but these provisions leave the state plan
intact and do not preempt state law before a modification is rejected or approval is
withdrawn. There is no indication in these provisions that any state deviation from
the formally approved plan is, by some self-executing feature, without effect until
it is brought to the Secretary’s notice and formally approved as an amendment.
29
Federal regulations and commentary are in accord that changes to state
plans may be implemented immediately, prior to any action by the Secretary of
Labor or that officer’s designee, federal OSHA: “Federal OSHA approval of a
State plan . . . in effect removes the barrier of Federal preemption, and permits the
State to adopt and enforce State standards and other requirements regarding
occupational safety or health issues regulated by OSHA. A State with an
approved plan may modify or supplement the requirements contained in its plan,
and may implement such requirements under State law, without prior approval of
the plan change by Federal OSHA. Changes to approved State plans are subject to
subsequent OSHA review. If OSHA finds reason to reject a State plan change,
and this determination is upheld after an adjudicatory proceeding, the plan change
would then be excluded from the State’s Federally-approved plan.” (29 C.F.R.
§ 1953.3(a) (2017).) Federal OSHA explained that this regulation reflects the
agency’s “longstanding interpretation of the Act to the effect that States which
have submitted and obtained Federal approval of a State plan under [the federal
OSH Act] may adopt modifications to their State plan (such as new standards,
regulations, amendments to State OSHA legislation, or revised enforcement
procedures) and may implement these modifications upon adoption, without prior
approval of each particular modification. . . . OSHA has always viewed its
enabling statute as not requiring pre-enforcement/pre-implementation Federal
approval . . . .” (67 Fed.Reg., supra, at p. 60123, italics added; see also 62
Fed.Reg., supra, at p. 31165 [“A modification to an approved State plan takes
effect prior to and pending OSHA review of the modification” and the burden of
proof rests on the party opposing the modification]; see Florida Citrus Packers v.
California (N.D.Cal. 1982) 545 F.Supp. 216, 219 [upholding federal OSHA’s pre-
approval enforcement policy]; see also Shell Oil Co. v. U.S. Dept. of Labor
30
(D.D.C. 2000) 106 F.Supp.2d 15, 18 [noting in passing that federal OSHA
routinely applies this pre-approval enforcement policy].)6
Finally, we reiterate the strong presumption against preemption, arising
both from the fact that the federal legislation addresses an area that has been the
long-standing subject of state regulation and from the fact that California has
assumed responsibility under the federal OSH Act to regulate worker safety and
health, thereby preempting federal law. In light of the cooperative character of the
federal OSH Act, the authority the federal OSH Act grants states that have
6
We are aware of Industrial Truck Ass’n v. Henry (9th Cir. 1997) 125 F.3d
1305, in which the court read the Gade plurality’s implied preemption analysis
relatively broadly, and concluded that the state regulations promulgated to
implement California’s Safe Drinking Water and Toxic Enforcement Act were
preempted by the federal OSH Act in the workplace context until the regulations
were included in the existing state OSHA standards and approved by the Secretary
of Labor. In the Industrial Truck Ass’n case, unlike here, it was undisputed that
the challenged regulations themselves constituted occupational safety and health
standards, and that there were inconsistent federal standards on the same issue;
that case did not present a situation implicating mere additional enforcement
measures for existing, approved standards. Moreover, as the Ninth Circuit
recognized, “[a]n agency’s interpretation of the preemptive effect of its regulations
is entitled to deference where Congress has delegated authority to the agency, the
agency’s interpretation is not contrary to a statute, and agency expertise is
important to determining preemption.” (Id. at p. 1311.) In light of this principle,
the Ninth Circuit should have given deference to the federal Department of
Labor’s decision approving California’s incorporation of provisions from
Proposition 65 into a standard under the state plan. (62 Fed.Reg, supra.) As noted
above, that decision reflects the federal agency’s view that a state may modify its
enforcement mechanisms without prior federal approval. (62 Fed.Reg., supra, at
p. 31165.) Proper consideration of the federal Department’s decision would have
led to a narrower reading of the federal OSH Act’s preemptive effect. (See also
National Cable & Telecommunications Ass’n v. Brand X Internet Services (2005
545 U.S. 967, 982 [a subsequent agency construction is entitled to deference under
Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. (1984) 467 U.S.
837 unless the court’s prior construction was based on a conclusion that the terms
of the statute were unambiguous, leaving no room for the agency’s construction].
31
assumed responsibility for worker safety and health, the nature of UCL and FAL
claims, and the strong presumption against preemption, we find no implied
preemption of the claims in this case.
2. Obstacle preemption
To recall, “Obstacle preemption permits courts to strike state law that
stands as ‘an obstacle to the accomplishment and execution of the full purposes
and objectives of Congress.’ [Citations.] It requires proof Congress had particular
purposes and objectives in mind, a demonstration that leaving state law in place
would compromise those objectives, and reason to discount the possibility the
Congress that enacted the legislation was aware of the background tapestry of state
law and content to let that law remain as it was.” (Quesada, supra, 62 Cal.4th at
p. 312.) We “conduct our analysis from the starting point of a presumption that
displacement of state regulation in areas of traditional state concern was not
intended absent clear and manifest evidence of a contrary congressional intent.”
(Id. at p. 315; see also Iskanian v. CLS Transportation Los Angeles, LLC (2014
59 Cal.4th 348, 388 [a high threshold must be surmounted before obstacle
preemption will be found].
The principal goal of the federal OSH Act’s enactment was to “address the
problem of uneven and inadequate state protection of employee health and safety”
by supplying a minimum level of protection throughout the country — a federal
“nationwide ‘floor’ of minimally necessary safeguards.” (United Air Lines, supra,
32 Cal.3d at p. 772.) Federal approval of the California plan indicates that this
goal has been met in this state. Even if we view UCL and FAL actions based on
Cal/OSHA violations as having a substantial impact on occupational safety and
health issues, that impact is not an obstacle to achieving the congressional
32
purpose, nor are additional enforcement mechanisms an obstacle to establishing at
least a minimum level of worker protection.7
Similarly, UCL and FAL claims that are premised on Cal/OSHA violations
do not conflict with the federal OSH Act’s provision that when state standards are
applicable to products in interstate commerce, the Secretary of Labor must
determine that the standards “are required by compelling local conditions and do
not unduly burden interstate commerce.” (29 U.S.C. § 667(c)(2).) Such claims
involve the same substantive standards that have been approved by the Secretary,
and therefore do not impose any greater substantive burdens on interstate
commerce. Even if the availability of greater penalties should be incorporated into
the state plan and submitted to the Secretary of Labor for review of any impact on
interstate commerce, it does not follow that any change that has not yet been
incorporated and approved is preempted in the meantime.
Neither do the UCL or FAL claims obstruct another of the federal OSH
Act’s purposes, namely to encourage the States “to assume the fullest
responsibility for the administration and enforcement of their occupational safety
and health laws.” (29 U.S.C. § 651(b)(11); see also 29 C.F.R. § 1902.1(a) (2017),
see id. § 1902.1(c)(1) (2017) [after an approved plan gains successful review the
year following its initial approval, the federal “enforcement authority shall not
apply with respect to any occupational safety or health issue covered by the
7
The congressional purpose recognized by the plurality opinion in Gade,
supra, 505 U.S. 88, that there be but a single standard of conduct to which
employers must adhere (id. at p. 99) was at issue in Gade because there was no
approved state plan that displaced the federal law. In contrast, the sole applicable
relevant standards in this state are the California standards. The Secretary of
Labor retains the authority to audit the state’s enforcement of its standards and to
withdraw federal approval, but until that happens, only the California standards
govern employer conduct.
33
plan”].) “OSHA has interpreted the OSH Act to recognize that States with
approved State plans retain broad power to fashion State standards” and to
experiment. (62 Fed.Reg., supra, p. 31160, italics added.) The federal OSH Act
“reflects [a] ‘search for enlightened public policy’. . . by removing the bar of
preemption through plan approval and, thus, allowing States to administer their
own workers’ protection laws so long as they meet the floor established by the
Federal OSHA program.” (Ibid.) We can identify no evidence that Congress had
a “particular purpose[] and objective[]” to restrict state authority to the exact terms
of the state’s approved state plan. (See Quesada, supra, 62 Cal.4th at p. 312.
Finally, there is no reason to “discount” Congress’s awareness and
acceptance of the “background tapestry” of state law in this area. (Quesada,
supra, 62 Cal.4th at p. 312) In the federal OSH Act’s savings clause, Congress
explicitly recognized the continuing applicability of state law in the field. (See 29
U.S.C. § 653(b)(4).) Under that clause, tort litigation could produce large civil
awards and penalties despite the existence of a more modest state administrative
enforcement plan, but such litigation is not preempted. Therefore, the magnitude
of the potential UCL and FAL penalties compared with the lesser administrative
penalties imposed under the state plan are not inconsistent with the federal
scheme.
Under the circumstances, there is no “clear and manifest evidence”
(Quesada, supra, 62 Cal.4th at p. 315) of a congressional intent to displace state
authority over unfair competition and consumer claims that are premised on
Cal/OSHA standards.
B. No express preemption of UCL and FAL claims
As noted above, the federal OSH Act does not state that claims such as
UCL and FAL claims or that enforcement actions beyond those specified in a state
34
plan are preempted until they are included in a plan and approved by the Secretary
of Labor. However, despite the absence of such a statement, express preemption
may be found where an act’s structure and language reflect a clear purpose of
Congress to preempt state law. (See Gade, supra, 505 U.S. at pp. 112-113 (conc.
opn. of Kennedy, J.) [express preemption of state law established by federal OSH
Act provisions that allow state regulation where there is no relevant federal
standard, require a state to submit a plan in order to assume responsibility for
worker safety and health, set forth conditions for approval of a plan, and require
continuing evaluation of a plan by the Secretary of Labor].
As our discussion above of implied preemption reflects, when a state has
obtained approval of a state plan for the regulation of worker safety and health,
state law preempts federal law. Moreover, with respect to the enforcement of
safety and health standards, the federal OSH Act requires enforcement at least as
effective as under the federal act; there is no indication in the language or structure
of the federal OSH Act that states with approved plans cannot supplement
enforcement of federally-approved standards by means of unfair business practice
claims. (See Farm Raised Salmon Cases, supra, 42 Cal.4th at p. 1090 [permitting
UCL claim to proceed and finding it significant that nothing in the federal Food,
Drug and Cosmetic Act said anything restricting the range of remedies states could
provide].) Finally, the federal OSH Act allows a state with an approved plan to
implement modifications or additions without prior approval of the plan change by
Federal OSHA.
In the absence of a clear and manifest congressional purpose to preempt
claims such as the UCL and FAL claims asserted in this action, such claims are
encompassed in the presumption against preemption that arises upon a state’s
assumption of responsibility under the federal OSH Act to regulate worker safety
and health. (See Quesada, supra, 62 Cal.4th at p. 315.
35
III. Disposition
The judgment of the Court of Appeal is reversed, and the matter is
remanded to the Court of Appeal with directions to vacate its order granting the
petition for writ of mandate and instead to deny the petition for writ of mandate,
and to remand the matter to the trial court for further proceedings not inconsistent
with this opinion.
CANTIL-SAKAUYE, C. J.
WE CONCUR:
CHIN, J.
CORRIGAN, J.
LIU, J.
CUÉLLAR, J.
KRUGER, J.
MIHARA, J.*
*
Associate Justice of the Court of Appeal, Sixth Appellate District, assigned
by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
36
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.
Name of Opinion Solus Industrial Innovations, LLC v. Superior Court
Unpublished Opinion
Original Appeal
Original Proceeding
Review Granted XXX 229 Cal.App.4th 1291
Rehearing Granted
Opinion No. S222314
Date Filed: February 8, 2018
Court: Superior
County: Orange
Judge: Kim Garlin Dunning
Counsel:
Fox Rothschild, David F. Faustman; Jones Day, Brian A. Sun and Frederick D. Friedman for Petitioners.
Luke A. Wake; Alston & Bird and Damien M. Schiff for National Federation of Independent Business
Small Business Legal Center as Amicus Curiae on behalf of Petitioners.
Shook, Hardy & Bacon, Phil Goldberg, Cary Silverman, Patrick Gregory; Manufacturers’ Center for Legal
Action, Linda E. Kelly and Patrick N. Forrest for National Association of Manufacturers as Amicus Curiae
on behalf of Petitioners.
Lawrence H. Kay for Construction Employers Association as Amicus Curiae on behalf of Petitioners.
No appearance for Respondent.
Tony Rackauckas, District Attorney, and Kelly A. Ernby, Deputy District Attorney, for Real Party in
Interest.
Mark Zahner for California District Attorneys Association as Amicus Curiae on behalf of Real Party in
Interest.
Christopher Jagard, Mi Kim, Amy D. Martin, Suzanne P. Marria and Kathryn J. Woods for State of
California Department of Industrial Relations, Division of Occupational Safety and Health as Amicus
Curiae on behalf of Real Party in Interest.
Counsel who argued in Supreme Court (not intended for publication with opinion):
David F. Faustman
Fox Rothschild
345 California Street, Suite 2200
San Francisco, CA 94104
(415) 364-5540
Kelly A. Ernby
Deputy District Attorney
Post Office Box 808
Santa Ana, CA 92702
(714) 834-3600
Mi Kim
Department of Industrial Relations
1515 Clay Street, Suite 701
Oakland, CA 94612
(510) 286-3800
Opinion Information
| Date: | Docket Number: |
| Thu, 02/08/2018 | S222314 |
