Court Opinion

ID: 9626921
Source: CourtListenerOpinion
Date Created: 2023-08-22 08:27:47.779078+00
Date Added: 2024-06-11T15:18:31.512804
License: Public Domain

CAPPY, Justice,
concurring.
I agree with the majority that Appellant’s state law cause of action against PaineWebber, Inc. on the basis of an alleged inadequate disclosure of order flow payments it received is preempted. I also agree that this court should follow the rationale presented by the Court of Appeals of New York in Guice v. Charles Schwab & Co., 89 N.Y.2d 31, 651 N.Y.S.2d 352, 674 N.E.2d 282 (N.Y.1996) as that opinion is well-reasoned. Where I part ways with the majority, however, is over which theory of preemption is applicable here.
The majority, citing this court’s opinion in First Federal Savings and Loan Association v. Office of State Treasurer, 543 Pa. 80, 669 A.2d 914, 916 (Pa.1995), notes that there are three types of preemption: first, where Congress expressly states an intent to preempt; second, where the Congress has created a legislative scheme which is so pervasive that there is a reasonable inference that Congress left no room for a state to supplement it;1 and third, that state law is preempted to the extent that it actually conflicts with state law. Although not noted by the majority, a refinement of this third theory of preemption states that state law may also be preempted via implied conflict preemption when “that state law ... stan[ds] as an obstacle to the accomplishment and execution of the full *532purposes and objectives of Congress.” Guice, 651 N.Y.S.2d 352, 674 N.E.2d at 285 (citing Barnett Bank of Marion County v. Nelson, 517 U.S. 25, 116 S.Ct. 1103, 134 L.Ed.2d 237 (1996)).
In Guice, the Court of Appeals of New York addressed a question identical to the one with which we are faced now. It found that the state law claims were preempted via- implied conflict preemption as allowing these claims “would unavoidably result in serious interference with the ‘accomplishment and execution of the full purposes and objectives of Congress.’ ” Guice, 651 N.Y.S.2d 352, 674 N.E.2d at 289 (citations omitted). The Guice court did not find field preemption applicable to this matter; the court determined that the “savings clause” of 15 U.S.C. § 78bb, which allows for state regulation of securities so long as those state regulations do not conflict with federal law, directly contradicted a finding that Congress implicitly intended to preempt the field. See Guice, 651 N.Y.S.2d 352, 674 N.E.2d at 291-292.
I believe that the Guice court’s holding that these state law causes of action were impliedly preempted is a sound one. Clearly, were states allowed to impose more stringent requirements on disclosure of order flow payments, the federal regulatory scheme of these payments would be rendered largely nugatory as brokers would have to craft their disclosures to meet potentially dozens of different state standards. See id., 651 N.Y.S.2d 352, 674 N.E.2d at 290.
The majority’s holding, in my opinion, does not comport with the rationale espoused in Guice. In its analysis, the majority states that neither express nor conflict preemption is applicable to this matter. Majority op. at 151. It then goes on to find that “federal regulation of the narrow subject of disclosure of order flow payments is so thorough that we have no difficulty finding the ‘reasonable inference’ ... that no room has been left for a state to impose additional requirements [i.e. field preemption applies].” Id. Insofar as the majority finds that field preemption, rather than implied conflict preemption, preempts Appellant’s state law cause of action, I believe that the majority’s opinion is not in accord *533with the holding of the well-reasoned Guice opinion.2 Therefore, I am constrained to concur in the result only.
Justices ZAPPALA and NIGRO join this Concurring Opinion.

. This second type of preemption is commonly known as “field preemption”. See English v. General Electric Company, 496 U.S. 72, 79, 110 S.Ct. 2270, 110 L.Ed.2d 65 (1990).

. Furthermore, I question whether the majority's narrow application of field preemption to a particular issue within securities regulation is supportable as my research has uncovered no case in which the field preemption doctrine has been applied to a particular issue within a field rather than the field as a whole.