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Ruckelshaus v. Monsanto Co. - 467 U.S. 986 (1984) :: Justia US Supreme Court Center
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Ruckelshaus v. Monsanto Co. - 467 U.S. 986 (1984)
Case	U.S. Supreme CourtRuckelshaus v. Monsanto Co., 467 U.S. 986 (1984)Ruckelshaus v. Monsanto Co.No. 83-196Argued February 27, 1984Decided June 26, 1984467 U.S. 986APPEAL FROM THE UNITED STATES DISTRICT COURT FOR
The Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) authorizes the Environmental Protection Agency (EPA) to use data submitted by an applicant for registration of a covered product (hereinafter pesticide) in evaluating the application of a subsequent applicant, and to disclose publicly some of the submitted data. Under the data-consideration provisions of § 3, as amended in 1978, applicants now are granted a 10-year period of exclusive use for data on new active ingredients contained in pesticides registered after September 30, 1978, while all other data submitted after December 31, 1969, may be cited and considered in support of another application for 15 years after the original submission if the applicant offers to compensate the original submitter. If the parties cannot agree on the amount of compensation, either may initiate a binding arbitration proceeding, and if an original submitter refuses to participate in negotiations or arbitration, he forfeits his claim for compensation. Data that do not qualify for either the 10-year period of exclusive use or the 15-year period of compensation may be considered by EPA without limitation. Section 10, as amended in 1978, authorizes, in general, public disclosure of all health, safety, and environmental data even though it may result in disclosure of trade secrets. Appellee, a company headquartered in Missouri, is an inventor, producer, and seller of pesticides, and invests substantial sums in developing active ingredients for pesticides and in producing end-use products that combine such ingredients with inert ingredients. Appellee brought suit in Federal District Court for injunctive and declaratory relief, alleging, inter alia, that the data-consideration and data-disclosure provisions of FIFRA effected a "taking" of property without just compensation, in violation of the Fifth Amendment, and that the data-consideration provisions violated the Amendment because they effected a taking of property for a private, rather than a public, purpose. The District Court held that the challenged provisions of FIFRA are unconstitutional, and permanently enjoined EPA from implementing or enforcing those provisions. Page 467 U. S. 987
(b) Prior to its amendment in 1972 (effective October 22, 1972), FIFRA was silent with respect to EPA's authorized use and disclosure of data submitted to it in connection with an application for registration. Although the Trade Secrets Act provides a criminal penalty for a Government employee who discloses, in a manner not authorized by law, any trade secret information revealed to him during the course of his official duties, it is not a guarantee of confidentiality to submitters of data, and, absent an express promise, appellee had no reasonable, investment-backed expectation that its information submitted to EPA before October 22, 1972, would remain inviolate in the EPA's hands. The possibility was substantial that the Federal Government at some future time would find disclosure to be in the public interest. A fortiori, the Trade Secrets Act, which penalizes only unauthorized disclosure, cannot be construed as any sort of assurance against internal agency Page 467 U. S. 988 use of submitted data during consideration of the application of a subsequent applicant for registration. Pp. 467 U. S. 1008-1010.
4. A Tucker Act remedy is available to provide appellee with just compensation for any taking of property that may occur as a result of FIFRA's data-consideration and data-disclosure provisions, and thus the District Court erred in enjoining EPA from acting under those provisions. Neither FIFRA nor its legislative history discusses the interaction between FIFRA and the Tucker Act, and inferring a withdrawal of Tucker Act jurisdiction would amount to a disfavored partial repeal by implication of the Tucker Act. FIFRA's provision that an original submitter of data forfeits his right to compensation from a later submitter for the use of the original submitter's data if he fails to participate in, or comply with the terms of, a negotiated or arbitrated Page 467 U. S. 989 compensation settlement merely requires a claimant to first seek satisfaction through FIFRA's procedure before asserting a Tucker Act claim. Pp. 467 U. S. 1016-1019.
BLACKMUN, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, MARSHALL, POWELL, REHNQUIST, and STEVENS, JJ., joined, and in which O'CONNOR, J., joined, except for Part IV-B and a statement on p. 467 U. S. 1013. O'CONNOR, J., filed an opinion concurring in part and dissenting in part, post, p. 467 U. S. 1021. WHITE, J., took no part in the consideration or decision of the case. Page 467 U. S. 990
Over the past century, the use of pesticides to control weeds and minimize crop damage caused by insects, disease, and animals has become increasingly more important for American agriculture. See S.Rep. No. 95-334, p. 32 (1977); S.Rep. No. 92-838, pp. 3-4, 6-7 (1972); H.R.Rep. No. 92511, pp. 3-7 (1971). While pesticide use has led to improvements in productivity, it has also led to increased risk of harm to humans and the environment. See S.Rep. No. 92-838, at 3-4, 6-7; H.R.Rep. NO. 92-511, at 3-7. Although the Federal Government has regulated pesticide use for nearly 75 years, [Footnote 2] FIFRA was first adopted in 1947. 61 Stat. 163. Page 467 U. S. 991
Because of mounting public concern about the safety of pesticides and their effect on the environment, and because of a growing perception that the existing legislation was not equal to the task of safeguarding the public interest, see S.Rep. No. 92-838, at 3-9; S.Rep. No. 92-970, p. 9 (1972); H.R.Rep. No. 92-511, at 5-13, Congress undertook a comprehensive revision of FIFRA through the adoption of the Federal Environmental Pesticide Control Act of 1972, 86 Stat. 973. The amendments transformed FIFRA from a labeling law into a comprehensive regulatory statute. H.R.Rep. No. 92-511, at 1. As amended, FIFRA regulated the Page 467 U. S. 992 use, as well as the sale and labeling, of pesticides; regulated pesticides produced and sold in both intrastate and interstate commerce; provided for review, cancellation, and suspension of registration; and gave EPA greater enforcement authority. Congress also added a new criterion for registration: that EPA determine that the pesticide will not cause "unreasonable adverse effects on the environment." §§ 3(c)(5)(C) and (D), 86 Stat. 980-981.
The 1972 amendments also included a provision that allowed EPA to consider data submitted by one applicant for registration in support of another application pertaining to a similar chemical, provided the subsequent applicant offered to compensate the applicant who originally submitted the data. § 3(c)(1)(D). In effect, the provision instituted a mandatory data-licensing scheme. The amount of compensation was to be negotiated by the parties, or, in the event negotiations failed, was to be determined by EPA, subject to judicial review upon the instigation of the original data submitter. The scope of the 1972 data-consideration provision, however, Page 467 U. S. 993 was limited, for any data designated as "trade secrets or commercial or financial information" exempt from disclosure under § 10 could not be considered at all by EPA to support another registration application unless the original submitter consented. Ibid.
Because of these and other problems with the regulatory scheme embodied in FIFRA as amended in 1972, see S.Rep. Page 467 U. S. 994 No. 95-334, at 2-5; H.R.Rep. No. 95-663, at 15-21; see generally EPA Office of Pesticide Programs, FIFRA: Impact on the Industry (1977), reprinted in S.Rep. No. 95-334, at 34-68, Congress enacted other amendments to FIFRA in 1978. These were effected by the Federal Pesticide Act of 1978, 92 Stat. 819. The new amendments included a series of revisions in the data-consideration and data-disclosure provisions of FIFRA's §§ 3 and 10, 7 U.S.C. §§ 136a and 136h. Under FIFRA, as amended in 1978, applicants are granted a 10-year period of exclusive use for data on new active ingredients contained in pesticides registered after September 30, 1978. § 3(c)(1)(D)(i). All other data submitted after December 31, 1969, may be cited and considered in support of another application for 15 years after the original submission if the applicant offers to compensate the original submitter. § 3(c)(1)(D)(ii). [Footnote 4] If the parties cannot agree on the amount of Page 467 U. S. 995 compensation, either may initiate a binding arbitration proceeding. The results of the arbitration proceeding are not subject to judicial review, absent fraud or misrepresentation. The same statute provides that an original submitter who refuses to participate in negotiations or in the arbitration proceeding forfeits his claim for compensation. Data that do not qualify for either the 10-year period of exclusive use or the 15-year period of compensation may be considered by EPA without limitation. § 3(c)(1)(D)(iii).
Also in 1978, Congress added a new subsection, § 10(d), 7 U.S.C. § 136h(d), that provides for disclosure of all health, Page 467 U. S. 996 safety, and environmental data to qualified requesters, notwithstanding the prohibition against disclosure of trade secrets contained in § 10(b). The provision, however, does not authorize disclosure of information that would reveal "manufacturing or quality control processes" or certain details about deliberately added inert ingredients unless
§§ 10(d)(1)(A) to (C). [Footnote 5] EPA may not disclose data to representatives of foreign or multinational pesticide companies unless the original submitter of Page 467 U. S. 997 the data consents to the disclosure. § 10(g). Another subsection establishes a criminal penalty for wrongful disclosure by a Government employee or contractor of confidential or trade secret data. § 10(f).
These active ingredients are sometimes referred to as "manufacturing-use products" because they are not generally sold directly to users of pesticides. Rather, they must first be combined with "inert ingredients" -- chemicals that dissolve, dilute, or stabilize the active components. The results of this process are sometimes called "end-use products," and the firms that produce end-use products are called "formulators." See the opinion of the District Court in this case, Monsanto Co. v. Acting Administrator, United States Environmental Protection Agency, 564 F.Supp. 552, 554 (ED Mo.1983). A firm that produces an active ingredient may Page 467 U. S. 998 use it for incorporation into its own end-use products, may sell it to formulators, or may do both. Monsanto produces both active ingredients and end-use products. Ibid.
The District Court found that development of a potential commercial pesticide candidate typically requires the expenditure of $5 million to $15 million annually for several years. The development process may take between 14 and 22 years, and it is usually that long before a company can expect any return on its investment. Id. at 555. For every manufacturing-use pesticide the average company finally markets, it will have screened and tested 20,000 others. Monsanto has a significantly bet