Acceptance of Position With Montgomery Ward Company by Consumer Product Safety Commission Employee ( 1978 )

January 11, 1978
78-1 MEMORANDUM OPINION FOR THE
GENERAL COUNSEL, CONSUMER
PRODUCT SAFETY COMMISSION
Consumer Product Safety Commission—
Former Officers and Employees— Accepting
Private Employment
This is in response to your inquiry whether § 4(g)(2) of the Consumer
Product Safefv Act, 86 Stat. 1210-11, as amended, 15 U.S.C. § 2053(g)(2)
(1977 Supp.), bai„ a Consumer Product Safety Commission employee from
accepting a position w!*h Montgomery Ward Company.
Section 4(g)(2) provide, in pertinent part that:
No regular officer or employee o f the Commission who was at any
time during the 12 months preceding the termination o f his em ploy­
ment with the Commission compensated at a rate in excess of the
annual rate of basic pay in effect for grade GS-14 of the General
Schedule, shall accept employment or compensation from any
manufacturer subject to this chapter, for a period of 12 months after
terminating employment with the Commission.
As we understand the situation, the employee has been offered a position
with Montgomery Ward handling credit-related matters. Montgomery Ward
stated that the position entails no Commission-related work in the consumer
area. The em ployee’s grade level is GS-15 and she has been with the
Commission for over 3 years. She states that during this time she has had no
dealings with M ontgomery Ward in her capacity as a Commission employee.
We understand further that Montgomery Ward is generally known as one of
the largest retailers in the country and is not engaged in manufacturing in the
sense that it makes any of its products. Montgomery Ward, does, however,
import approximately 8 —10 percent of its retail consumer products for sale in its
department stores. This importation gives rise to the problem.
Section 4(g)(2) only prohibits post-Commission employment with manufac­
turers; and although Montgomery Ward is not a manufacturer in the usual
meaning of that term, § 3(a)(4), 15 U .S.C . § 2052(a)(4), of the Act defines a
1
“ m anufacturer” to include “ any person who manufactures or imports a
consumer product.” Therefore, a literal interpretation of the language of
§ 3(a)(4) would result in M ontgomery W ard’s classification as a “ manufactur­
er” for purposes of the Act. On that basis the employee would be barred from
accepting the position with M ontgomery Ward. We believe, however, that the
postemployment bar o f § 4(g)(2) was not intended to be construed in this
manner.
Section 3(a)(4), by including importers within the definition of manufactur­
ers, sought to insure that consum er products would not escape regulation of the
Commission merely because they were manufactured abroad and imported into
the United States. H. Rept. No. 92-1153, 92d C ong., 2d sess. (1972), at 28,
states:
. . . to assure parity of regulation, importers are made subject to the
same responsibilities as domestic manufacturers.
Importers are thus subject to the regulatory authority o f the Commission as are
manufacturers. Therefore, a Commission employee could theoretically abuse
his or her position to secure the improper advantages condemned in H. Rept.
No. 1153, supra, with importers as well as with traditional manufacturers.
Consequently, § 4(g)(2) applies to importer-employers with the same force that
it applies to m anufacturers-employers.
M ontgomery W ard, however, is only incidentally involved in importation. It
is in business primarily as a retailer. If a retailer imported but one item, it would
technically fall within the definition o f a m anufacturer under § 3(a)(4). To bar
employment of a form er Commission employee with a retail company that
imported one insubstantial item would not effectuate the intent behind
§.4(g)(2); it would be absurd to assume that a Commission employee could so
use his position in this insignificant case as leverage to secure subsequent
employment with that company. When the application of a statute’s literal
language leads to an absurd result, it is generally safe to assume that the result
is inconsistent with C ongress’ purpose in enacting the statute. United States v.
Bryan, 339 U .S. 323, 338 (1950). Cf. United Stales v. Brown, 333 U .S. 18,
25-26 (1948) (penal statutes), and Glickstein v. United States, 222 U.S. 139,
142-43 (1911). Application o f the literal language o f the Act to the above
hypothetical would lead to such a result.
Nonetheless, there necessarily comes a point when a growing importation
business o f a retail com pany reaches a level of importation such that the
company must be considered an importer, and thus a manufacturer for the
purposes o f § 4(g)(2). Given the particular facts of this case, we believe that
Montgomery W ard has not yet reached that p o in t.1
'W e think it im portant to note that in the present case the em ployee has no dealings with
M ontgom ery W ard in her capacity as a C om m ission em ployee. Further, she will not be working
with the im porting arm o f that com pany. G iven these facts, we believe that she would be working
for M ontgom ery W ard-the-retailer and not M ontgom ery W ard-the-im porter. This distinction,
which we think m eaningful in the case at hand, might becom e artificial and im practicable if the
im portation business increased so that it were no longer incidental to the retail business.
2
Apart from the above, it has been suggested that the failure of § 4(g)(2) to
make explicit reference to retailers was inadvertent, because the legislative
intent was to prevent persons from using a Commission position to secure em ­
ployment or future clients from the “ regulated industry,” and because the
term “ regulated industry” in its common usage encompasses retailers as well
as manufacturers.2 We disagree. The pertinent legislative history of § 4(g)(2)
states that the section was designed to
. . . assure that persons will not seek employment with the agency or
use their Federal office as a means of subsequently gaining em ploy­
ment in the regulated industry or as a means of acquiring members of
industry as future clients. H. Rept. No. 92-1153, supra, at 30.
A fair reading of the legislative history reveals that the term “ industry” was
intended to include only manufacturers. In H. Rept. No. 1153, supra, at 26, the
House Committee on Interstate and Foreign Commerce stated:
In addition to the need to establish comprehensive and effective
regulation over the safety of unreasonably hazardous consumer
products, there is a need to insure that the procedures relating to
consumer products are fair to both industry and consumers. The
Committee heard extensive testimony from manufacturers and trade
associations documenting some of the potential difficulties that might
be faced in complying with the regulations of a product safety
agency. This testimony convinces the Committee that it is essential to
establish both an effective and fair product safety program, impacting
to the minimum practicable on the manufacturing process. In
addition, an effective consumer safety program must insure an
adequate opportunity for participation and judicial review by con­
sumers and regulated industries. [Emphasis added.]3
The above quotation indicates that manufacturers were the relevant entities in
the “ regulated industry” to which the Committee refers. Therefore, we can
discover no inconsistency in the legislative history in Congress’ clear intent to
omit “ retailers” from the coverage o f § 4(g)(2).
A review of the language o f the Act itself is also helpful in ascertaining
congressional intent on this point. The Act refers to both “ retailers” and
“ manufacturers” in other provisions4 while § 4(g)(2) omits any reference to
retailers. Thus, we can infer that retailers were not intended to be covered
by that section. This view of statutory construction has found expression in the
2The Com m issioner has expressed this view. A lthough he is o f the opinion that § 4(g)(2)
intended to extend the postem ploym ent bar to those who engage in any im porting he would not
enforce this provision in this case for equitable reasons. W hile it is clear that § 4(g)(2) cannot apply
to retailers since they are not referred to in that section, we understand the C om m issioner's
argum ent to be that any retailer who may technically com e within the definition o f "m an u factu rer"
in § 3(a)(4) should be considered a barred em ployer because Congress intended to include retailers
in the prohibition of § 4(g)(2).
*See also H. Rept. No. 1153, supra, pp. 22, 23.
4S e e , e .g ., 15 U .S .C . §§ 2055(b)(1), 2064(b) through 2064(e) (§ 2064(d) am ended by Pub. L.
No. 94-284, 90 Stat. 508, as codified in 15 U .S .C . § 2064(d)).
3
maxim expressio unius est exclusio alterius. Sutherland, Statutory Construc­
tion, § 47.23 (4th ed.,1973), in explaining this maxim, states:
As the maxim is applied to statutory interpretation where a form of
conduct, the manner o f its performance and operation, and the
persons and things to which it refers are designated, there is an
inference that all omissions should be understood as exclusions. . . .
The force of the maxim is strengthened by contrast where a thing is
provided in one part of the statute and omitted in another.
This maxim is particularly appropriate in the present situation. Thus, the
inference necessarily is that the omission o f retailers from § 4(g)(2) was
intentional.
As further evidence o f congressional intent respecting § 4(g)(2), the term
“ m anufacturer” is used, without any reference to “ retailers,” throughout the
legislative history of that section.5 This consistency o f omission bolsters the
argument that those entities were intentionally left out o f § 4(g)(2).
In light of the foregoing, it is our opinion that Congress had no intention of
applying the prohibition o f § 4(g)(2), to retailers.
Therefore, since M ontgomery Ward is primarily in business as a retailer— an
entity not subject to the postem ploym ent bar o f § 4(g)(2)— the mere fact that it
engages in the modest amount o f importing as exists here does not automati­
cally transform it into a barred em ployer under § 4(g)(2).
’In our opinion, the employee may accept the position with Montgomery
Ward since § 4(g)(2) does not apply to the facts o f this particular case.
L eon U lm an
D eputy Assistant Attorney General
Office o f Legal Counsel
5See H. Rept. No. 92-1153, supra (1972), at 4, 30; H. Conf. Rept. No. 92-1593, 92d C ong., 2d
sess. (1972), pp. 4-6.