The Competitive Enterprise Institute Daily Update
Issues in the News
1. LEGAL
The Supreme Court overturns a $79.5 million award to a smoker’s widow in a case against Philip Morris USA.
CEI Expert Available to Comment: Special Projects Counsel Hans Bader on another recent legal development in the limitation of punitive damages:
“The Ninth Circuit Court of Appeals has just held in the Engquist case that a legislature can limit punitive damages payable to a plaintiff in a pending lawsuit, without violating the Takings Clause. It reasoned that punitive damages are contingent and discretionary, and not a generally applicable right like the right to compensatory damages for an injury. Thus, a legislature can limit them, or require that part of the punitive damages awarded in a case be paid into the state treasury rather than to the plaintiff. This ruling buttresses the constitutionality of tort reform laws that limit punitive damages, which a minority of state courts have declared unconstitutional.”
2. BUSINESS
California lifts restrictions on the use of more-affordable plastic water piping in home construction.
CEI Experts Available to Comment: Director of Risk & Environmental Policy Angela Logomasini in the New York Post on why New York City should follow California’s example:
“In 2004, then Gov. George Pataki vetoed a bill that would have extended a similar ban, liberating homeowners in New York state from this ridiculous policy. Well, except in New York City – whose building code still restricts plastic piping. Yes, new code revisions will soon permit the piping, which costs about a third of the alternatives, in buildings of five stories or less. But everyone else must pay much higher prices for bathroom and kitchen remodels/construction – as well as more costly routine plumbing repairs.”
3. ENERGY
American farmers, eyeing success in Brazil, see big profits in growing crops to meet the burgeoning U.S. demand for ethanol.
CEI Experts Available to Comment: Adjunct Analyst Marcus Renato Xavier on why it is unlikely the U.S. will be able to replicate Brazil’s ethanol successes:
“Given Brazil’s natural and acquired advantages for ethanol production, it is difficult to imagine the United States matching Brazil’s level of ethanol consumption—40 percent of the motor fuel market—at a reasonable economic cost. In the U.S., corn-based ethanol would be viable only if it were to compete in the market on the same basis as other fuels. American taxpayers today pay twice for ethanol: once in crop subsidies to corn farmers and again in a 51-cent subsidy for every gallon of ethanol. Without such a subsidy, ethanol simply would not be cost-competitive with gasoline.”