Stop the World, We Want Our Own Labels: Treaties, State Voter Initiative Laws, and Federal Pre-Emption

. 1 O’Reilly: Stop the World, We Want Our Own Labels: Treaties, State Voter Ini Published by Penn Law: Legal Scholarship Repository, 2014 U. Pa. J. Int'l Econ. L. new trading arrangements do not merely disfavor dis-integrative local impositions on trade, but exclude them as well. Congressional compromises over U.S. acceptance of the Uruguay Round of GATT structured but did not eliminate this jeopardy to state laws.4 Within the United States, if state voter initiatives clash with the Constitution, or with the nation's international trade obligations as established by treaties, the state initiative legislation must recede.5 California's eccentric 1986 labeling initiative, voterapproved "Proposition 65 6 requiring product warnings and imposing privately-enforced penalties, will be an important test case of treaty supremacy in the coming years. The states as a "laboratory of democracy" at the state ballot box have produced an unusual mixture of laws over the years. The California initiative produced a disclosure scheme impacting thousands of imported and domestic goods. When import trade, state sovereignty, cancer fears, and the environment clash, the result makes for interesting new legal disputes: will the engine of world commerce and global trade politics be strong enough to outpower one state's novel scheme? Section 2 of this Article sets the groundwork for the potential conflict between state law and international treaty obligations. Section 3 examines the substantive and procedural aspects of California's Proposition 65. Section 4 discusses principles of ' See generally Final Act Embodying the Results of the Uruguay Round of Multilateial Trade Negotiations, Apr. 15, 1994, LEGAL INSTRUMENTS-RESULTS OF THE URUGUAY ROUND vol. 1 (1994), 33 I.L.M. 1125 (1994) [hereinafter Final Act] establishing the World Trade Organization in furtherance of the general goals of liberalizing world trade and eliminating domestic barriers thereto). ' See Uruguay Round Agreements Act, Pub. L. No. 103-465, S 103 (codified at 19 U.S.C. § 3512 (1994)) (establishing a dispute settlement mechanism to resolve conflicts that may arise between state law and the Uruguay Round agreements). ' The rules of statutory construction apply to the initiative statute. See Center for Pub. Interest Law v. Fair Political Practices Comm'n, 259 Cal. Rptr. 21, 26 (Cal. Ct. App. 1989). However, the presumption of constitutionality will lead the court to adopt an interpretation that avoids rendering the statute unconstitutional. See 2A NORMAN J. SINGER, SUTHERLAND STATUTORY CONSTRUCTION S 45.11 (5th ed. 1992). 6 See CAL. HEALTH & SAFETY CODE § 25249.1 (West 1992). The law was adopted as a ballot measure enumerated as "Proposition 65" on the 1986 general election ballot. See generally ROGER L. CARRICK, SURVIVING PROPOSITION 65 (1987) (providing historical background on the measure). [Vol. 18:2 2 Journal of International Law, Vol. 18, Iss. 2 [2014], Art. 8 http://scholarship.law.upenn.edu/jil/vol18/iss2/8 TREA TIES AND FEDERALISM federal pre-emption doctrine and reasons why they, in themselves, have not rendered Proposition 65 unenforcable. Section 5 explores the theoretical implications of the GATT and WTO on domestic laws. Section 6 predicts the ways that these principles might actually be applied by WTO panels. Finally, Section 7 foresees an inevitable collision between the principles discussed in the previous sections and suggests that the results of this conflict will shape the future of federalism, government regulation, and international trade. 2. BACKGROUND OF THE DEBATE 2.1. The Role of Treaty Obligations Many treaties are international agreements used to speed up and simplify trade in commercial goods. World trade has increasingly been subject to tariff reduction or elimination treaties that promote the free flow of goods among nations. The recentlyformed World Trade Organization ("WTO"), an outgrowth of seven years of negotiation under GATT's Uruguay Round,8 fo: example, is the most far-reaching affirmation of the importance of a global view of trade for the United States.9 GATT opened U.S. markets to consumer goods made in every other signatory nation."0 Multinational decisions made in the form of global treaties and bilateral agreements will dominate the twenty-first century regulatory obligations of producers and exporters with respect to topics such as labeling and bans of certain ingredients. ' See Final Act, supra note 3, art. I ("The World Trade Organization (hereinafter referred to as 'the WTO' is hereby established."); see also id. arts. Il-V, VII-VII (establishing the scope, functions, structure, budget, and general legal status of the WTO). ' See generally JEFFREY SCHOTT & JOHANNA W. BuURMAN, THE URUGUAY ROUND: AN ASSESSMENT (1994) (detailing the events and contours of the Uruguay Round of GATT negotiations). 9 See generally ROBERT HUDEC, ENFORCING INTERNATIONAL TRADE LAW: THE EVOLUTION OF THE MODERN GATT LEGAL SYSTEM (1993); 2 LAW & PRACTICE OF THE WORLD TRADE ORGANIZATION (Joseph Dennin ed., 1995) [hereinafter LAW & PRACTICE]. 10 See GATT, supra note 1, art. IE (establishing generally the principle of national treatment: once goods have been imported into one GATT member nation from another, the receiving nation may not discriminate between the imported goods and domestically produced goods); see generally KENNETH N. DAM, THE GATT: LAW AND INTERNATIONAL ECONOMIC ORGANIZATION (1970). 19971 3 O’Reilly: Stop the World, We Want Our Own Labels: Treaties, State Voter Ini Published by Penn Law: Legal Scholarship Repository, 2014 U. Pa. J Int'l Econ. L. Under the Constitution, the President is assigned the task of negotiating international treaties, subject to the advice and consent of the Senate." Treaties have special status; they become the law of the United States under Article VI, Clause 2 of the Constitution.12 A decision that a treaty should contain certain provisions regarding trade, for example, would probably generate considerable political conflict within the Senate. The Senate has the authority to decide whether to ratify a treaty 3 and then both Houses of Congress enact the necessary implementing legislation. 4 This treaty power is part of the national government's constitutional duties, a power that the Tenth Amendment did not reserve to the states by the Tenth Amendment."5 Federal courts have exclusive jurisdiction over cases arising under international treaties.16 Treaties are contracts between the United States and another nation.'7 They ordinarily pre-empt any state law to the contrary, especially state laws that hinder operation of an international treaty.19 In effect, a treaty trumps state law that adopts a contrary requirement. " See U.S. CONST. art. II, S 2, cl. 2. 12 See id. art. VI, cl. 2; see also Dreyfus v. Von Finck, 534 F.2d 24, 29 (2d Cir.), cert. denied, 429 U.S. 835 (1976) ("A United States treaty is a contract with another nation which under art. VI, cl.2 of the Constitution becomes a law of the United States."). "3 See U.S. CONST. art. I. 14See, e.g., Uruguay Round Agreements Act, Pub. L. No. 103-465, 108 Stat. 4814 (1994) (codified at 19 U.S.C. 3512 (1994)). " See U.S. CONST. amend. X; Reid v. Covert, 354 U.S. 1, 18 (1957) (stating that "to the extent that the United States can validly make treaties, the people and the states have delegated their power to the National Government and the Tenth Amendment is no barrier"). 16 See 28 U.S.C. § 1331(a) (1994). 17 See Von Finck, 534 F.2d at 29 (holding that a "United States treaty is a contract with another nation which under Art. VI, cl. 2 of the Constitution becomes a law of the United States"). '" See Oneida Indian Nation v. New York, 691 F.2d 1070, 1088 (2d Cir. 1982) (stating that under the Supremacy Clause, "treaties entered into by Congress were binding on the states and paramount to any conflicting acts on the part of their legislatures"). " See In re Air Crash in Bali, Indonesia, 684 F.2d 1301, 1309 (9th Cir. 1982) (holding that California state law was pre-empted to the extent it would prevent the operation of an international treaty). [Vol. 18:2 4 Journal of International Law, Vol. 18, Iss. 2 [2014], Art. 8 http://scholarship.law.upenn.edu/jil/vol18/iss2/8 TREA TIES AND FEDERALISM 2.2. Communicating About Risks This Article addresses an unusual variant on the toxicological principle that "the dose makes the poison." 20 Toxicologists calculate the risk of cancer from product exposure to or misuse of certain chemicals; in some cases, the assessment of risk is so high that the government opts to regulate by compelling protective measures such as warning labels. The presence and composition of chemicals in a formulated product can be determined by analysis. The mere presence of a chemical is not properly equated with risk of cancer or other hazards to human users of a prod-