Obama-Era Court Fights Become Mission Impossible After Trump Win

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President Barack Obama speaks on Nov. 16, 2016, in Athens.

  • Lawsuits range from environmental to health care to finance
  • Administration change likely to alter U.S. stance on key cases

Three days before Donald Trump’s inauguration as the 45th U.S. president, attorneys for Barack Obama’s outgoing administration will ask an appeals court to revive rules governing oil-and-gas fracking on federal land.

Even if Obama wins, the victory would likely be short-lived.

Trump’s "highest advisers generally agree with our side of the lawsuit," said Mark S. Barron, a lawyer for trade groups that joined Wyoming and three other states seeking to overturn the restrictions that they contend would unduly restrict energy companies’ use of hydraulic fracturing. "The Bureau of Land Management hasn’t identified a single incident or problem that this federal rule would have prevented. The fact of the matter is fracking is regulated pretty heavily under state law."

The president-elect has promised to boost the economy in part by scuttling regulations introduced under Obama. High-profile court cases over rules related to health care, the environment and the financial industry may become moot in January when both the executive and legislative branches come under control of the Republican Party, which has been hostile to them. Still, the process of reversing the policies won’t be easy.

"I don’t think the entire Obama legacy is going to be undone in a month, but there’s a chance for some pretty substantial chipping away of his hallmark legislation," said Christoper Walker, who teaches constitutional litigation at Ohio State University’s Moritz College of Law. "A fair amount of these rules could be unwound pretty quickly."

In the fracking case, a U.S. judge in Wyoming in June found federal rules that set detailed standards for drilling wells in shale formations on about 700 million acres of federal land exceeded the authority of the Bureau of Land Management and blocked their enforcement. The U.S. appealed. Arguments are set for Jan. 17 in Denver.

Here’s a look at some other suits and rules that may be upended under Trump’s administration.

Environment

The Environmental Protection Agency last year enacted the Clean Power Plan, Obama’s effort to reduce carbon-dioxide emissions and slow global warming. It’s likely on the chopping block as Trump has called global warming a hoax. Bolstered by mining interests and power companies, 27 states sued to overturn the CPP. A Washington court heard arguments in the case in September.

“It is our hope that the regulation will be withdrawn after Donald Trump takes office,” West Virginia Attorney General Patrick Morrisey said in a statement. “That should preclude the need for further litigation, but we will need to discuss the mechanics with the new administration to determine how we will proceed.”

Another long-running battle that’s likely to fade is a suit by 15 states over EPA rules for mercury and other power-plant pollutants. The Supreme Court sided with the states when the late Justice Antonin Scalia faulted the agency for failing to do a cost-benefit analysis. After the EPA did one, the states sued again. The case may be over if Trump changes the rules.

Wetlands

Judges in Cincinnati are considering a 31-state challenge to expanding the Clean Water Act to include dry creek beds, prairie wetlands and other areas. Last year, the appeals court put those rules on hold. On Dec. 8, it will hear arguments about whether to retain them.

“We have a host of cases pending against the federal government due to the Obama administration’s overreach,” said Jennifer Speller, a spokeswoman for Texas Attorney General Ken Paxton. “We will continue to pursue all of these cases and look forward to working with a new administration.”

Finance

Trump’s transition team last week said it planned to dismantle the 2010 Dodd-Frank Act, calling it “a sprawling and complex piece of legislation that has unleashed hundreds of new rules and several new bureaucratic agencies.” That may mean the end of the Financial Stability Oversight Board, a panel of U.S. financial agency heads that decides which firms are systemically important to the nation’s economy, known as “too big to fail.”

MetLife Inc., one of four non-banks to bear the label, won a federal court ruling in March rescinding the designation. The U.S. appealed. Trump’s administration could withdraw the appeal and allow the lower-court ruling to stand if the panel hasn’t yet ruled.

Another Dodd-Frank agency that could be affected is the Consumer Financial Protection Bureau. Last month, a federal appeals court threw out a $109 million penalty the CFPB slapped on PHH Corp., a New Jersey mortgage company. The judges said the agency had violated the company’s rights but refused to abolish the bureau, as the company had requested. Trump could do that regardless of whether the Obama administration appeals.

Retirement Planning

The Labor Department this year announced rules compelling those who dispense retirement-planning advice to put client interests ahead of their own, sparking at least a half-dozen suits. One, filed in a Washington federal court by the National Association for Fixed Annuities, was thrown out on Nov. 4. Arguments in a related case are set for Thursday in Dallas.

“We’re very hopeful that after Trump is inaugurated that he will move to kill the DOL rule,” said NAFA Executive Director Chip Anderson.

Health Care

Obama’s signature achievement, the Affordable Care Act, has long been marked for death by Republican opponents, even as Trump has signaled he may retain some elements of it. The House Republican leadership successfully sued in 2014 to block the administration from paying for portions of the plan. Obama appealed, but it won’t matter if Trump scuttles most of Obamacare.

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