Melissa Varela v. Fca US LLC ( 2022 )

IN THE
SUPREME COURT OF THE STATE OF ARIZONA
MELISSA VARELA,
Plaintiff/Appellant,
v.
FCA US LLC, ET AL.,
Defendants/Appellees.
No. CV-20-0157-PR
Filed March 1, 2022
Appeal from the Superior Court in Maricopa County
The Honorable Connie Contes, Judge
No. CV2015-008635
REVERSED AND REMANDED
Opinion of the Court of Appeals, Division One
249 Ariz. 89 (2020)
AFFIRMED; VACATED IN PART
COUNSEL:
G. Lynn Shumway, Shumway Law PLLC, Phoenix; Brent Ghelfi (argued),
Ghelfi Law Group, PLLC, Phoenix; and Christopher J. Zachar, Zachar Law
Firm, P.C., Phoenix, Attorneys for Melissa Varela
Paul G. Cereghini, Travis M. Wheeler, Bowman and Brooke LLP, Phoenix;
and Thomas H. Dupree, Jr. (argued), Gibson Dunn, Washington, DC,
Attorneys for FCA US LLC, LVN Motors LLC, and PV Holding Corporation
David L. Abney, Ahwatukee Legal Office, P.C., Phoenix, Attorney for
Amici Curiae Arizona Association for Justice and Arizona Trial Lawyers
Association
VARELA V. FCA US LLC, ET AL.
Opinion of the Court
Larry E. Coben, Anapol Weiss, Scottsdale, Attorney for Amici Curiae
Center for Auto Safety and Consumers for Auto Reliability and Safety
Patrick X. Fowler, Ashley Wiberg, Snell & Wilmer LLP, Phoenix; and Nicole
A. Saharsky, Eric A. White, Mayer Brown LLP, Washington, DC, Attorneys
for Amici Curiae PLAC and Alliance for Automotive Innovation
Thomas M. Klein, Briana L. Campbell, Klein Thomas & Lee, Phoenix,
Attorneys for Amicus Curiae Nissan North America, Inc.
JUSTICE MONTGOMERY authored the opinion of the Court, in which
CHIEF JUSTICE BRUTINEL, VICE CHIEF JUSTICE TIMMER, and
JUSTICES BOLICK, LOPEZ, and BEENE joined.
JUSTICE MONTGOMERY, opinion of the Court:
¶1 Under the Supremacy Clause of the Federal Constitution,
when a state law conflicts with a properly enacted federal law, the state law
is preempted. State law includes duties imposed by state tort law. Federal
law includes regulations promulgated by executive agencies under
authority delegated by Congress. Preemption may also occur in the
absence of a regulation under the doctrine of implied obstacle preemption
when state tort law conflicts with a clear federal policy objective established
by an executive agency acting within properly delegated authority.
¶2 At issue in this case is whether, in the absence of a
promulgated safety regulation, the National Highway Transportation
Safety Administration (the “Agency”) has established a clear policy
objective concerning automatic emergency breaking (“AEB”) technology
that preempts state tort law claims based on an auto manufacturer’s alleged
failure to install AEB. We hold that, based on the facts and allegations in
this case and the administrative record before us, the Agency has not
established a policy objective that actually conflicts with the claims at issue.
Thus, the claims are not preempted.
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I. FACTUAL AND PROCEDURAL BACKGROUND
¶3 In 2015, a 2014 Jeep Grand Cherokee traveling at high speed
rear-ended Melissa Varela’s stopped car, despite the Jeep driver’s last-
moment attempt to brake and steer clear. The collision injured Varela and
killed her four-year-old daughter, Vivian. The Jeep that struck Varela’s car
was a Jeep Grand Cherokee “Limited” that was not equipped with forward
collision warning plus (“FCW+”), which is also referred to as AEB. 1 FCW+
was available as an option on the Limited and Overland trim level versions
of the Grand Cherokee and was a standard feature on the Summit and SRT
trim levels.
¶4 Varela sued FCA US LLC, LVN Motors, LLC, and PV Holding
Corp. (collectively “Chrysler”), alleging negligence, defective product
design, defective product warning, and wrongful death. Varela asserted
that the collision would not have occurred, or at least would have caused
less damage, if the Jeep had been equipped with FCW+. Chrysler moved
to dismiss the lawsuit, asserting it was preempted pursuant to implied
obstacle preemption given the Agency’s objectives regarding the
development and deployment of AEB technology, which do not mandate
AEB installation on vehicles such as the Jeep. Relying on policy guidance
published by the Agency in 2016 and 2017, as well as the Agency’s denial
of a petition to regulate AEB in 2017, the trial court granted Chrysler’s
motion. The court reasoned that the referenced documents “reflect[ed] the
federal government’s intention to preempt this field ‘to incentivize the
installation of these technologies in a way that allows for continued
innovation and technological advancement.’”
1 AEB encompasses the components of FCW+, which consists of: forward
collision warning (“FCW”) that alerts the driver through light, audio, or
haptic feedback signals that a collision is likely; crash imminent braking
that activates braking when the driver has failed to apply force to the brake
pedal when a crash is likely or unavoidable; and dynamic brake support
that activates braking when the driver has not applied sufficient force to the
brake pedal. Federal Motor Vehicle Safety Standards; Automatic
Emergency Braking, 82 Fed. Reg. 8391, 8392 (petition for proposed
rulemaking denied Jan. 25, 2017).
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¶5 The court of appeals reversed after finding that “nothing in
[the] record” indicated the Agency’s intention to “preempt tort claims
based on the absence of AEB.” Varela v. FCA US LLC, 249 Ariz. 89, 95 ¶ 19
(App. 2020). Based on the facts and allegations in this case, the court
distinguished its conclusion from a contrary one reached by a different
panel in Dashi v. Nissan North America, Inc., 247 Ariz. 56 (App. 2019) (finding
claims based on an alleged failure to install AEB preempted under the
doctrine of implied obstacle preemption). Varela, 249 Ariz. at 91 ¶ 2.
¶6 We accepted review because this case involves an issue of
statewide importance concerning the federal preemption of state tort law,
and because different panels of the court of appeals have issued conflicting
opinions. We have jurisdiction pursuant to article 6, section 5(3) of the
Arizona Constitution. We review issues of law concerning the federal
preemption of state tort law claims de novo. See Conklin v. Medtronic, Inc.,
245 Ariz. 501, 504 ¶ 7 (2018).
II. DISCUSSION
A. Preemption in General
¶7 The Supremacy Clause of the Federal Constitution provides
that “the Laws of the United States . . . shall be the supreme Law of the
Land; . . . any Thing in the Constitution or Laws of any State to the Contrary
notwithstanding.” U.S. Const. art. VI, cl. 2. Federal law may therefore
preempt an otherwise valid state law. Espinoza v. Mont. Dep’t of Revenue,
140 S. Ct. 2246, 2262 (2020) (“‘[T]his Clause creates a rule of decision’
directing state courts that they ‘must not give effect to state laws that
conflict with federal law[ ].’” (quoting Armstrong v. Exceptional Child Ctr.,
Inc., 575 U.S. 320, 324 (2015))). State law, for purposes of conflict
preemption analysis, includes duties imposed as a result of state tort law.
See Geier v. Am. Honda Motor Co., 529 U.S. 861, 881 (2000).
¶8 Preemption generally occurs in one of two ways. Id. at 884.
Express preemption occurs when federal lawmakers explicitly state that
related state law is preempted. Morales v. Trans World Airlines, Inc., 504 U.S.
374, 383 (1992). Preemption can also be implied, Geier, 529 U.S. at 884,
which can manifest in one of three forms. Field preemption occurs “when
the scope of a [federal] statute indicates that Congress intended federal law
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to occupy a field exclusively.” Kurns v. R.R. Friction Prods. Corp., 565 U.S.
625, 630 (2012) (quoting Freightliner Corp. v. Myrick, 514 U.S. 280, 287 (1995)).
A second form is based on impossibility where “it is impossible . . . to
comply with both state and federal [legal] requirements.” English v. Gen.
Elec. Co., 496 U.S. 72, 79 (1990). The third form is obstacle preemption, when
a state law “stands as an obstacle to the accomplishment and execution of
the full purposes and objectives of Congress.” Arizona v. United States, 567
U.S. 387, 399 (2012) (quoting Hines v. Davidowitz, 312 U.S. 52, 67 (1941)).
¶9 Federal regulations, in addition to laws passed by Congress,
may also preempt state laws. Sprietsma v. Mercury Marine, 537 U.S. 51, 65
(2002) (stating that if a state common-law claim directly conflicted with a
federal regulation promulgated under the Federal Boat Safety Act, or if it
were impossible to comply with any such regulation without incurring
liability under state common law, preemption would occur). Obstacle
preemption may also occur when a federal agency, acting pursuant to
authority delegated by Congress, decides not to regulate a particular matter,
so long as its corresponding explanation for the decision conveys an
“authoritative” message of preemptive federal objectives. Id. at 66–67
(acknowledging that “a federal decision to forgo regulation in a given area
may imply an authoritative federal determination that the area is best left
unregulated, and in that event would have as much pre-emptive force as a
decision to regulate” (quoting Ark. Elec. Coop. Corp. v. Ark. Pub. Serv.
Comm’n, 461 U.S. 375, 384, (1983))); see also Fid. Fed. Sav. & Loan Ass’n v. de
la Cuesta, 458 U.S. 141, 155 (1982) (finding that a state’s limitation on the use
of optional “due-on-sale clauses” in federal savings and loans contracts
presented an actual obstacle to regulatory policy “authorizing [but not
requiring] federal savings and loan associations to enforce due-on-sale
clauses ‘subject only to express limitations imposed by the [Federal Home
Loan Bank] Board’”). Thus, in the specific instance of obstacle preemption,
although a court must identify an “actual conflict,” an express statement of
preemptive intent is not necessary. Geier, 529 U.S. at 884.
¶10 Chrysler has the burden of establishing preemption. Conklin
v. Medtronic, Inc., 245 Ariz. 501, 504 ¶ 8 (2018).
B. Administrative Record
¶11 Chrysler contends that the administrative record reflects
purposeful action on the part of the Agency to establish a policy to refrain
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from requiring manufacturers to equip vehicles with AEB, to leave room
for manufacturer flexibility in implementing and innovating AEB
technology, and to leave the regulation of automated vehicle systems to the
federal government rather than the states. Additionally, Chrysler asserts
that published guidance documents and the denial of a petition for
proposed rulemaking to regulate AEB in 2017 make it clear that the Agency
sought to “ensure safety advances in AEB technologies by eschewing a
design requirement in favor of giving manufacturers the freedom to
innovate and improve.” Therefore, according to Chrysler, Varela’s state
tort claims which would require AEB installation conflict with the Agency’s
policy goals. Varela argues that the record reflects a policy to encourage
rapid adoption and implementation of AEB and that the published
guidance provides no evidence of preemptive intent. Thus, her suit is not
preempted.
¶12 While it is not necessary to have “a specific, formal agency
statement identifying [a] conflict” to conclude that one exists, Geier, 529 U.S.
at 884, evidence of a preemptive intent or purpose must be clear, id. at 885,
and “convey an ‘authoritative’ message of a [preemptive] federal policy,”
Sprietsma, 537 U.S. at 67. The conflict cannot simply be a consequence of a
secondary regulatory consideration or something simply permitted under
the regulatory status quo that was not purposefully sought in pursuit of
significant regulatory goals. See Williamson v. Mazda Motor of Am., Inc., 562
U.S. 323, 338 (2011) (Sotomayor, J., concurring) (explaining that the “mere
fact” a regulation permits an option to manufacturers does not mean that
this option is a preemptive “regulatory objective”).
¶13 We presume that federal lawmakers do not “cavalierly pre-
empt” state law because “the States are independent sovereigns in our
federal system,” see Medtronic, Inc. v. Lohr, 518 U.S. 470, 485 (1996), and have
historically “had great latitude” to protect “the lives, limbs, health, comfort,
and quiet” of their citizens, id. at 475 (quoting Metro. Life Ins. Co. v.
Massachusetts, 471 U.S. 724, 756 (1985)). This presumption against
preemption is “particularly” strong in “field[s] which the States have
traditionally occupied,” Wyeth v. Levine, 555 U.S. 555, 565 (2009) (quoting
Lohr, 518 U.S. at 485), such as adjudicating “common-law tort actions,”
Geier, 529 U.S. at 887 (Stevens, J., dissenting) (describing this function as
part of the “traditional jurisdiction” of “state courts”).
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¶14 Accordingly, “[c]ourts must cautiously approach this
interpretive task” and avoid stitching together the fragmentary musings of
federal lawmakers into a preemptive purpose that does not exist and was
not intended.2 See MCI Sales & Serv., Inc. v. Hinton, 329 S.W.3d 475, 483 (Tex.
2010). Indeed, such a “freewheeling judicial inquiry” risks “undercut[ting]
the principle” that Congress (acting on its own or through a federal agency)
preempts state law, not the courts. Chamber of Comm. v. Whiting, 563 U.S.
582, 607 (2011) (quoting Gade v. Nat’l Solid Wastes Mgmt. Ass’n, 505 U.S. 88,
111 (1992) (Kennedy, J., concurring in part and concurring in judgment)).
¶15 We underscore the need for interpretive caution with a few
additional points. As mentioned, the Supremacy Clause, according to its
plain language, comes into effect when federal “Laws . . . made in
Pursuance” of the Constitution and a state law are contrary. U.S. Const. art.
VI, cl. 2. But to be “made in Pursuance” of the Constitution, id., federal law
must adhere to certain procedural requirements, namely the Bicameral and
Presentment Clauses, Wyeth, 555 U.S. at 585–6 (Thomas, J., concurring)
(citing U.S. Const. art. I, § 7, cls. 2–3). The Framers designed this “step-by-
step, deliberate and deliberative process” to prevent “arbitrary
governmental acts” from going “unchecked” and thereby “protect[ing] the
people from the improvident exercise of power.” I.N.S. v. Chadha, 462 U.S.
919, 957, 959 (1983).
¶16 Implied preemption stands in tension with these procedural
requirements because under that doctrine, state law is preempted not by
what is expressed in federal law, but rather by what may be implied by
federal law. Though such implications can certainly arise from the text of
federal law, they necessarily exist outside of it. By venturing beyond the
text of federal law, courts risk preempting state law based on something
2
We keep this cautionary note in mind particularly because the right to seek
redress for injury in Arizona is a constitutional right. Ariz. Const. art. 18,
§ 6 (“The right of action to recover damages for injuries shall never be
abrogated . . . .”); Cronin v. Sheldon, 195 Ariz. 531, 538 ¶ 35 (1999) (“[A]rticle
18, § 6 prevents abrogation of all common law actions for negligence,
intentional torts, strict liability, defamation, and other actions in tort which
trace origins to the common law.”); see also Ariz. Const. art. 2, § 31 (“No law
shall be enacted in this state limiting the amount of damages to be recovered
for causing the death or injury of any person.”).
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other than what has been “made in Pursuance” of the Constitution. When
that happens, the consequences are two-fold. First, the preemption of state
law effects “a serious intrusion into state sovereignty,” Medtronic, 518 U.S.
at 488, and implying preemption too broadly may impinge on this
sovereignty where unwarranted, thereby usurping the residual power that
the Constitution guarantees to the states. See Watters v. Wachovia Bank, N.A.,
550 U.S. 1, 44 (2007) (Stevens, J., dissenting) (explaining that preemption
“affects the allocation of powers among sovereigns”); see also The Federalist
No. 33, at 172 (Alexander Hamilton) (Clinton Rossiter ed., 1999) (noting that
acts of the federal government “which are not pursuant to its constitutional
powers” are “invasions of the residuary authorities [of the states]” and
“acts of usurpation”). Second, beyond siphoning governmental power
reserved for the states, implying preemption too readily risks usurping
legislative authority to enact laws and, when the federal law at issue stems
from an agency within the executive branch, it improperly inflates
executive power as well. See Lipschultz v. Charter Advanced Servs. (MN), LLC,
140 S. Ct. 6, 7–8 (2019) (denial of cert.) (Thomas, J., concurring) (doubting
that an executive agency’s policy can be preemptive law under the
Supremacy Clause).
¶17 Altogether, liberally applying implied preemption
destabilizes the twin pillars of our constitutional order: federalism and the
separation of powers. Accordingly, courts must be vigilant and avoid
speculative conflicts far removed from the text of laws and authorized
regulations and carefully adhere to what is in, or necessarily follows from,
the text of federal law. See Rice v. Norman Williams Co., 458 U.S. 654, 659
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(1982) (“The existence of a hypothetical or potential conflict is insufficient
to warrant the pre-emption of the state statute.”). 3
¶18 Mindful of the need for caution, we now turn to reviewing the
administrative record. Our task is to determine whether the Agency has
conveyed an authoritative message establishing a federal policy of
maintaining manufacturer choice for the development and deployment of
AEB technology, has determined that AEB is best left unregulated, and that
any AEB regulation is an exclusive federal responsibility. The record
consists of information from the New Car Assessment Program (the
“Program”), guidance published by the Department of Transportation
(“DOT”) and the Agency from 2016 to 2020, 4 and the Agency’s denial of a
2017 petition for rulemaking that would have required installation of AEB
technology on all light vehicles, including vehicles like the Jeep Grand
Cherokee. We also have two notices of proposed rulemaking issued by the
Agency in March and December of 2020.
3 Members of the U.S. Supreme Court have called the implied obstacle
preemption doctrine into further question. The doctrine, they argue, “rests
on judicial guesswork about ‘broad federal policy objectives, legislative
history, or generalized notions of congressional purposes,’” rather than the
text of federal law, which is what the Supremacy Clause explicitly
references. Kansas v. Garcia, 140 S. Ct. 791, 808 (2020) (Thomas, J.,
concurring); see also Va. Uranium, Inc. v. Warren, 139 S. Ct. 1894, 1907–08
(2019) (plurality opinion) (reasoning that because of the “speculation”
inherent in obstacle preemption, courts must be careful not to “displac[e]
perfectly legitimate state laws on the strength of ‘purposes’ that only
[courts] can see, that may seem perfectly logical to [this Court], but that lack
the democratic provenance the Constitution demands before a federal law
may be declared supreme”); Caleb Nelson, PREEMPTION, 86 Va. L. Rev.
225, 232 (2000) (discussing preemption doctrine and concluding that “a
general doctrine of obstacle preemption is misplaced”).
4 For simplicity, we will only refer to the Agency when referencing
guidance documents.
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1. The Program
¶19 Varela points to the Program as evidence of the Agency’s goal
to encourage accelerated deployment of the relevant technology. Chrysler
rejects any use of the Program as a source for setting an AEB standard.
¶20 Pursuant to Title II of the Motor Vehicle Information and Cost
Savings Act of 1972, the Agency established the Program in 1978.
Consumer Information; New Car Assessment Program, 73 Fed. Reg. 40015,
40016 (July 11, 2008). As the Program requires, the Agency compiles the
results of safety testing and shares the information with consumers in the
form of a five-star rating system, which consumers can then reference when
making a choice about which car to buy. Id. Manufacturers, in turn,
“respond to the ratings by voluntarily improving the safety of their vehicles
beyond the minimum Federal safety standards.” Id.¶21 Beginning in model year 2010, the Agency identified FCW as
one of several technologies for inclusion in a program for rating crash
avoidance. Id. at 40033. By 2015, the Program incorporated each element
of AEB among recommended crash avoidance technologies. New Car
Assessment Program, 80 Fed. Reg. 68604 (Nov. 5, 2015). As characterized
by the Agency, the Program, in conjunction with efforts to encourage
manufacturers to voluntarily install AEB, helps to “create availability and
market push for AEB technologies.” Federal Motor Vehicle Safety
Standards; Automatic Emergency Braking, 82 Fed. Reg. 8391 (petition for
proposed rulemaking denied Jan. 25, 2017). At best, then, the Program
reflects the Agency’s efforts to inform vehicle purchasers about current
safety elements in vehicles that, in turn, encourage auto manufacturers to
make their products as safe as possible. The Program is therefore not a
means of establishing safety standards nor does it serve to communicate
any preemptive intent regarding AEB.
2. Policy Guidance
¶22 From 2016 to 2020, the Agency published a series of
documents providing guidance with respect to automated vehicles and
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automated driving systems. 5 According to Chrysler, “[t]he federal
guidance documents are a critical part of the regulatory record because they
show that [the Agency] views regulation of the design of automated
vehicles and vehicle systems as an area of exclusive federal responsibility,”
as well as the Agency’s belief that voluntary compliance is the most efficient
means for AEB deployment. Varela questions the applicability of the
published documents on the grounds that FCW+ is not encompassed by the
automated vehicles and automated driving systems addressed therein.
However, guidance published in 2018, Automated Vehicles 3.0, states that:
“This document considers automation broadly, addressing all levels of
automation (SAE automation Levels 1 to 5), and recognizes multimodal
interests in the full range of capabilities this technology can offer.”
Automated Vehicles 3.0 at viii (emphasis added) (citation omitted).
Consequently, we make no distinction between FCW+ and AEB.
¶23 As for Chrysler’s assertion that the published guidance
establishes a view by the Agency that regulation of automated vehicles and
automated driving systems is exclusively federal, we disagree. Nowhere in
any of the four documents does the Agency make such a claim of exclusive
regulatory authority. Instead, the published guidance acknowledges a
continuing and collaborative role for states and explicitly encourages states
to review tort liability in the automated vehicle and automated driving
system contexts.
¶24 Although Chrysler is correct that published guidance
“strongly encourage[d] States to allow [the Agency] alone to regulate the
safety design and performance aspects of [automated driving system]
technology,” the Agency acknowledged in A Vision for Safety that states “are
beginning to draft legislation to safely deploy emerging [automated driving
5 U.S. Dep’t of Transp. & Nat’l Highway Traffic Safety Admin., Fed.
Automated Vehicles Pol’y, Accelerating the Next Revolution in Roadway Safety
(Sept. 2016); U.S. Dep’t of Transp. & Nat’l Highway Traffic Safety Admin.,
Automated Driving Sys. 2.0: A Vision for Safety (“A Vision for Safety”), (Sept.
2017); U.S. Dep’t of Transp. & Nat’l Highway Traffic Safety Admin.,
Preparing for the Future of Transp.: Automated Vehicles 3.0, (“Automated
Vehicles 3.0”), (Oct. 2018); U.S. Dep’t of Transp. & Nat’l Highway Traffic
Safety Admin., Ensuring American Leadership in Automated Vehicle
Technologies: Automated Vehicles 4.0 (“Automated Vehicles 4.0”), (Jan. 2020).
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systems].” A Vision for Safety at ii. 6 The Agency also noted in Automated
Vehicles 3.0 that states were engaged in regulating the testing and operation
of automated vehicles. Automated Vehicles 3.0 at 19–20. The Agency even
suggested that if a state did “pursue [automated driving system]
performance-related regulations, that State should consult with [the
Agency].” A Vision for Safety at 20.
¶25 To support states’ efforts, the Agency included in A Vision for
Safety a “Best Practices” section “to clarify and delineate the Federal and
State roles in the regulation of [automated driving systems] and lay out a
framework that the States can use as they write their laws and regulations
surrounding [automated driving systems] to ensure a consistent, unified
national framework.” A Vision for Safety at 19. Nonetheless, the Agency
noted that “[t]he goal of State policies in this realm need not be uniformity
or identical laws and regulations across all States. Rather, the aim should
be sufficient consistency of laws and policies to promote innovation and the
swift, widespread, safe integration of [automated driving systems].” Id. at
20. With respect to enforcement, the Agency made clear that “[t]his
Guidance is entirely voluntary, with no compliance requirement or
enforcement mechanism.” Id. at 2.
¶26 In delineating the respective roles of the federal government
and the states, the Agency also explicitly recognized the states’
responsibility to regulate insurance and liability. Id. at 20. Specifically, the
Agency recommended that states include in applications for permission for
roadway testing a request for “evidence of the . . . ability to satisfy a
judgment or judgments for damages for personal injury, death, or property
damage caused by an [automated driving system].” Id. at 23. States were
also advised to “[b]egin to consider how to allocate liability among
[automated driving system] owners, operators, passengers, manufacturers,
and other entities when a crash occurs” and that “[s]tates could begin to
consider rules and laws allocating tort liability.” Id. at 24. The Agency
further stated in Automated Vehicles 3.0 that the traditional roles of each level
of government were “well suited” to address the field of automation and
that “[s]tates and local governments play the lead role in licensing drivers,
establishing rules of the road, and formulating policy in tort liability.”
6A Vision for Safety replaced the guidance issued in 2016. A Vision for Safety
at i. We therefore do not reference the guidance published in 2016.
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Automated Vehicles 3.0 at 5.
¶27 The Agency’s only direct comment concerning preemption in
the field of automated vehicles and automated driving systems concerned
issues that would inevitably arise as it developed safety standards. On that
point, the Agency simply stated:
The Department will carefully consider . . . jurisdictional
questions as [the Agency] develops its regulatory approach to
[automated driving systems] and other automated vehicle
technologies so as to strike the appropriate balance between
the Federal Government’s use of its authorities to regulate the
safe design and operational performance of an [automated
driving system]-equipped vehicle and the State and local
authorities’ use of their traditional powers.
Id. at 6. There was no further comment with respect to the Agency’s intent
to preempt states in the field of automated driving systems let alone with
respect to AEB specific technology and nothing in the guidance published
in 2020 indicated otherwise. 7
¶28 On the whole, the published guidance fails to demonstrate
any intent by the Agency to exercise an exclusive regulatory role in the area
of automated vehicle and automated driving system testing, development,
or deployment. Likewise, the guidance, lacking the force of law and with
no requirement for compliance or mechanism of enforcement, does not
foreclose the traditional role of states in regulating tort liability. As for any
authoritative statement concerning preemption, the closest any document
comes to discussing the issue is the acknowledgment that as standards are
7
Automated Vehicles 4.0, published in 2020, merely set forth federal
principles in support of the development and deployment of automated
vehicles, automated driving systems, and it listed available government
resources. Automated Vehicles 4.0 at 1. The publication is devoid of any
declaration of exclusive federal regulation of automated systems or vehicles
or any statement concerning preemptive intent. With respect to the
relationship between the Agency and states in the regulation of automated
driving systems, it simply referenced previous “non-binding guidance.” Id.
at 17.
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developed, preemption will have to be addressed.
3. 2017 Denial of Petition for Rulemaking
¶29 In 2017, the Agency denied a petition to initiate rulemaking
that would have mandated the installation of AEB in all lightweight
vehicles like the Jeep Grand Cherokee. 82 Fed. Reg. at 8391. Chrysler insists
that the Agency “acted purposefully” in an authoritative and preemptive
manner when it denied the petition because its stated policy goals of
spurring technological advancement, encouraging consumer acceptance,
and promoting safety “were best served not by an inflexible mandate that
manufacturers must equip their vehicles with AEB technologies but rather
by encouraging innovation and voluntary deployment through methods
other than mandatory requirements.” Chrysler further concludes that the
Agency declined to impose an AEB mandate “at this early stage of
technological evolution” because of the “risk of inadvertently stymieing
innovation and stalling the development and introduction of successively
better versions of these technologies.” Id. at 8393.
¶30 However, the preceding quotes come from the section
discussing the context in which the petition was considered. None of these
points were offered as rationale for declining to grant the petition in the
actual analysis and we should consider the entirety of the petition’s denial
to discern whether the Agency conveyed an authoritative policy objective
with a preemptive intent. See Sprietsma, 537 U.S. at 66 (setting forth Coast
Guard’s entire explanation for deciding not to engage in regulatory action
as part of assessing any preemptive intent).
¶31 Our review of the Agency’s denial establishes that it did not
deny the petition due to a belief that mandating installation of AEB
technology would hinder development and safety objectives. Instead, the
denial was based on the Agency’s judgment that other efforts to encourage
the deployment of AEB were proving to be as successful as the requested
rulemaking would provide and, if needed, rulemaking was always
available. 82 Fed. Reg. at 8394. In particular, the Agency noted the success
of the Program in “influencing light vehicle manufacturers to increase their
installation of AEB technologies and to improve their performance,” along
with the specific incorporation of AEB technologies in safety ratings. Id.
The Agency underscored the Program’s effectiveness by highlighting
voluntary commitments by light vehicle manufacturers to deploy AEB,
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including Chrysler, and the role played by independent rating entities to
encourage AEB use. Id. This led to the conclusion “that the benefits of the
AEB aspects of [the Program], in combination with the benefits of the
industry commitment and the stakeholder rating programs, would be
substantially similar to the benefits of the rulemaking requested by the
petitioners.” Id.
¶32 The Agency also expressed concern over the time it would
take to engage in rulemaking, explaining:
Based on the Agency’s rulemaking proceedings on complex
issues in recent years, if the Agency were to grant the petition,
conduct research, tentatively select required levels of
performance, conduct a notice-and-comment rulemaking and
provide sufficient lead time to enable manufacturers to phase-
in compliance, the delay in making AEB standard equipment
on light vehicles would be as many as three years, and
possibly longer.
Id.
¶33 Furthermore, the Agency simply did not prioritize AEB
rulemaking. Acknowledging the success at increasing AEB installation
through non-rulemaking activities, the Agency determined that its limited
resources could be better spent on tasks of “higher priority,” and, “if it
proves necessary,” rulemaking could be commenced later on. Id. The
Agency concluded the analysis of the petition by stating that “[g]iven the
success of light vehicle AEB activities . . . and the large array of rulemakings
either mandated by Congress or initiated by the Agency in response to
petitions or at the Agency’s discretion, the Agency should place priority at
this time on conducting rulemakings in areas other than light-vehicle AEB.”
Id. at 8394.
¶34 We cannot disregard what the Agency has highlighted as its
predominant rationale for foregoing rulemaking. See Williamson, 562 U.S.
at 333–35 (identifying the “more important reason” for permitting
manufacturers’ an option with seat belt installation as a concern with cost
rather than relying on a possible separate regulatory concern for which the
record provided only “some indication” of importance). Unlike the
preemptive safety standard in Geier that intentionally preserved a range of
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options for manufacturers because “safety would best be promoted if
manufacturers installed alternative protection systems in their fleets rather
than one particular system in every car,” 529 U.S. at 881, the Agency’s
denial does not reference a goal of preserving manufacturer choice
pursuant to any particular safety concern. Simply permitting manufacturer
choice in and of itself is not a policy goal entitled to preemptive effect.
Williamson, 562 U.S. at 338 (Sotomayor, J., concurring) (explaining that the
“mere fact” a regulation permits an option to manufacturers does not mean
that this option is a preemptive “regulatory objective”). Instead, what
animated the Agency’s denial boils down to its views on need and speed.
Put another way, the Agency denied the rulemaking petition due to the
perceived lack of any need for an AEB rule and the lengthy and arduous
nature of the rulemaking process.
¶35 The Agency’s decision to forego formal rulemaking because,
in its judgment, nonregulatory efforts have been or are proving successful
does not establish a significant regulatory objective concerning the actual
regulation of AEB, nor does it reflect a determination that AEB is best left
unregulated. We will not read an agency’s preference to avoid formal
rulemaking under these circumstances to constitute a statement that “as a
matter of policy” there should be no rules governing AEB. Sprietsma, 537
U.S. at 67. Similarly, the Agency’s decision to forego rulemaking based on
its judgment that rulemaking is arduous and that its resources were better
invested in other priorities “cannot by itself show that [it] sought to forbid
common-law tort suits in which a judge or jury might reach a different
conclusion.” Williamson 562 U.S. at 335. While the Agency’s denial of the
rulemaking petition certainly reflects an intentional and careful decision to
forego formal rulemaking, it does not provide an authoritative policy
statement that AEB should not be regulated by state tort law. See Sprietsma,
537 U.S. at 67. Overall, the basis for the Agency’s denial does not evince a
clear authoritative preemptive intent.
4. Subsequent Rulemaking Activity 8
¶36 The Agency published a proposal for rulemaking involving
automated driving systems in March of 2020. Occupant Protection for
8 We take notice of the Agency’s proposal for rulemaking and advance
notice of a proposal for rulemaking pursuant to Arizona Rule of Evidence
201.
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Automated Driving Systems, 85 Fed. Reg. 17624 (Mar. 30, 2020). Unlike the
2017 denial, the proposal explicitly addressed preemption. 85 Fed. Reg.
17643 (“Pursuant to Executive Orders 13132 and 12988, 9 [the Agency] has
considered whether this proposal could or should preempt State common
law causes of action.”). The Agency stated therein:
To this end, the agency has examined the nature (e.g., the
language and structure of the regulatory text) and objectives
of this proposal and finds that this proposal, like many
[Agency] rules, would prescribe only a minimum safety
standard. As such, [the Agency] does not intend that this
proposal preempt state tort law that would effectively impose
a higher standard on motor vehicle manufacturers than that
to be established by this proposal. Establishment of a higher
standard by means of State tort law would not conflict with
the minimum standard announced here. Without any
conflict, there could not be any implied preemption of a State
common law tort cause of action.
Id. Thus, the most recent Agency statement in the field of automated
driving system regulation reflects no intent to preempt state tort law.
Because automated driving systems employ AEB technology, this
statement further bolsters our conclusion that the Agency has not impliedly
preempted tort claims like those Varela alleges here.
¶37 More recently in December 2020, the Agency published an
advance notice of proposed rulemaking that envisioned “a framework
9 Executive Order 12988, signed by President William J. Clinton, requires
agencies to review a proposed regulation to ensure it “specifies in clear
language the preemptive effect, if any, to be given to the regulation . . . .”
Civil Justice Reform, 61 Fed. Reg. 4729, 4731 (Feb. 7, 1996). Executive Order
13132, also signed by President William J. Clinton, requires that “[w]hen an
agency proposes to act through adjudication or rulemaking to preempt
State law, the agency shall provide all affected State and local officials notice
and an opportunity for appropriate participation in the proceedings.”
Federalism, 64 FR 43255, 43257 (Aug. 10, 1999).
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approach to safety . . . [that] would use performance-oriented approaches
and metrics that would accommodate the design flexibility needed to
ensure that manufacturers can pursue safety innovations and novel designs
in [automated driving system] technologies.” Framework for Automated
Driving System Safety, 85 Fed. Reg. 78058, 78059 (proposed Dec. 3, 2020) (to
be codified at 49 C.F.R. pt. 571). The Agency specifically referenced the
guidance published in 2017, 2018, and 2020, noting that the approaches to
developing a new framework “would likely build off the three primary
[automated driving system] guidance documents issued in recent years by
DOT.” Id.¶38 Consistent with the referenced documents, the advance notice
makes no statement of “exclusive” regulatory authority nor, unlike the
March notice, does it reference preemption. It also notes activity within
some states, including Arizona, to permit the operation of automated
driving system vehicles on state roadways. Id. at 78060. These two notices
make clear that where preemption related to automated vehicles and
automated driving systems regulation is of concern, the Agency will
explicitly address it; otherwise, the status quo is maintained with respect to
the role of state law in motor vehicle safety regulation.
C. Actual Conflict
¶39 Chrysler argues that allowing Varela’s claims to proceed
“would frustrate [the Agency’s] federal regulatory objectives by thrusting
a jury-imposed AEB standard on [manufacturers] inside Arizona’s
borders.” Dashi, 247 Ariz. at 64 ¶ 42. We disagree. To the extent there is a
manifest Agency policy objective concerning AEB installation, it is to see
AEB deployed as quickly and as broadly as possible. Varela’s suit may spur
the very type of activity the Agency seeks. A jury finding in Varela’s favor
could encourage manufacturers who have decided to offer AEB technology
on vehicles for sale to make AEB standard on all trim levels and not just
some. Varela’s suit may provide a complementary shove to the “pull”
resulting from efforts by the Agency to encourage voluntary compliance for
increased AEB deployment and the “push” from the effects of the Program
and independent rating agencies to highlight the use of AEB by
manufacturers. 82 Fed. Reg. at 8391.
¶40 Varela’s claims would thus not conflict with the “execution of
the full purposes and objectives” of the Agency if the message conveying a
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preemptive intent is one setting a goal for the speedy and widespread
deployment of AEB. See Williamson, 562 U.S. at 330 (quoting Hines, 312 U.S.
at 67). Regardless, “we are reluctant in the absence of strong evidence,” to
find an actual conflict between state law and federal policy goals where the
Agency has not communicated that any conflict may exist. Hillsborough
Cnty. Fla. v. Automated Med. Lab’ys, Inc., 471 U.S. 707, 721 (1985).
¶41 Finally, because the applicability of implied obstacle
preemption is a threshold issue, we have no occasion to consider the merits
of Varela’s claims.
D. Applicable Precedent
¶42 While our assessment of the administrative record and
conclusion regarding any actual conflict with Varela’s claims are
dispositive of the issue before us, we nevertheless consider the parties’
arguments concerning an apparent conflict regarding conclusions about
preemption between Dashi and the court of appeals’ opinion in this case.
¶43 The court of appeals observed that there are essentially two
sets of cases that bear on the matter before us: Geier and Dashi, and Sprietsma
and Williamson. Varela, 249 Ariz. at 95 ¶ 17. Chrysler argues that Geier and
Dashi apply to this matter because each addresses a similar Agency policy
objective concerning manufacturer choice, and each involves tort claims
like Varela’s. Chrysler further asserts that because Dashi properly relied on
Geier for its analysis, Dashi should likewise guide our analysis of Agency
objectives and review of the administrative record. Varela argues that the
court of appeals properly recognized that Dashi did not apply, and that
Sprietsma is the controlling U.S. Supreme Court precedent. We consider
each case in turn.
1. Geier v. American Honda Motor Co.
¶44 Geier considered whether the plaintiff’s state law tort suit
conflicted with the Federal Motor Vehicle Safety Act (the “Act”) and
Federal Motor Vehicle Safety Standard (“FMVSS”) 208 promulgated
pursuant to the Act. 529 U.S at 864–65. The plaintiff’s suit alleged
negligence and design defect on the part of a car manufacturer for failing to
install a driver’s side airbag in a car, which otherwise complied with
applicable safety standards. Id. at 865.
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¶45 After initially finding the suit not expressly preempted by the
Act, but nonetheless subject to implied preemption principles, the Court
examined the language of the regulation, a contemporaneous explanation
for providing a range of choices of passive restraint systems, and DOT’s
amicus brief that explained that “safety would best be promoted if
manufacturers installed alternative protection systems in their fleets rather
than one particular system in every car.” Id. at 881. Lastly, the Court
“place[d] some weight upon DOT’s interpretation of FMVSS 208’s
objectives and its conclusion, as set forth in the Government’s [amicus]
brief, that a tort suit such as this one would ‘stan[d] as an obstacle to the
accomplishment and execution’ of those objectives.” Id. at 883 (citation
omitted) (internal quotation marks omitted).
¶46 The Court ultimately concluded that if the plaintiff prevailed
in the lawsuit, “manufacturers of all similar cars [would have been
required] to install airbags rather than other passive restraint systems, such
as automatic belts or passive interiors.” Id. at 881. Consequently, implied
obstacle preemption applied “[b]ecause the rule of law for which
petitioners contend would have stood as an obstacle to the accomplishment
and execution of the important means-related federal objectives” as
discussed. Id. (citation omitted) (internal quotation marks omitted).
¶47 Chrysler characterizes Geier’s holding as providing “that
when [the Agency] declines to require a particular safety feature because
preserving manufacturers’ choice furthers important federal policy goals,
plaintiffs cannot attempt to impose that requirement through state tort
liability.” Chrysler’s generalization of the holding of Geier and the
argument that it is outcome determinative in this case calls forth an
observation we share with the Texas Supreme Court: “when Geier’s
reasoning is oversimplified to find preemption based on a choice between
two safety options and then exported to other safety standards where the
unique text and history of [the passive restraint regulation in question] are
not relevant, we must respectfully disagree.” Hinton, 329 S.W.3d at 497.
¶48 We also note the importance of an actual promulgated safety
regulation to Geier’s conclusion as underscored in Williamson. 562 U.S. at
336 (reviewing whether the Act and an amended version of FMVSS 208
preempted a lawsuit over a manufacture’s failure to install a particular style
of seatbelt). Therein, the Court explicitly stated that it determined the
significant policy in question in Geier “on the basis of our examination of
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the regulation, including its history, the promulgating agency’s
contemporaneous explanation of its objectives, and the agency’s current
views of the regulation’s [preemptive] effect.” Id. at 330.
¶49 In the case before us, there is no promulgated safety standard
for us to examine. While not fatal to Chrysler’s conflict preemption claim,
see supra ¶ 9, this does render Geier’s analysis inapplicable. Unlike the
passive restraint systems regulated in Geier, the Agency has neither
authorized nor required any particular AEB system or specific combination
of AEB component features from which Chrysler or any other manufacturer
may reference to assert regulatory compliance. Likewise, we lack any DOT
statement on preemption as to whether a suit like Varela’s would create an
obstacle to AEB policy objectives remotely like the explicit position the DOT
provided in Geier. Therefore, given the distinctly different facts and the lack
of a promulgated regulation with express agency views, we conclude that
Geier does not control our determination of preemption nor does it offer an
analogous framework for analysis.
2. Dashi v. Nissan North America, Inc.
¶50 Dashi involved a suit where the plaintiff claimed the 2008
Nissan Rogue that hit her vehicle was “unreasonably dangerous and
defective” because it lacked then-available AEB technology. Dashi, 247
Ariz. at 58 ¶ 3. Dashi analyzed the administrative record before the court
under the framework set forth in Geier, id. at 60–64 ¶¶ 14–39, and concluded
that the plaintiff’s claims were preempted by the doctrine of implied
obstacle preemption, id. at 67 ¶ 59. Chrysler contends we should agree with
Dashi’s preemption finding and overrule the court of appeals in this case
because Dashi “correctly focused on DOT and [the Agency’s] statements
regarding their ‘broad enforcement authority to address existing and new
automotive technologies and equipment,’ and [Dashi’s] emphasis on
preemption in this context, including citation to Geier.” (Quoting id. at 64
¶ 39).
¶51 There are two reasons we decline to follow Dashi’s finding on
preemption. The first has to do with the reliance on Geier. As with the
record before us, the Dashi court did not have a regulation to review, which
featured so heavily in Geier’s analysis. Therefore, as discussed above, Geier
does not provide the appropriate analytical framework for determining
AEB preemption. Second, the record for our review has two notices of
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proposed rulemaking issued by the Agency concerning automated driving
systems since Dashi was decided. Significantly, while the Dashi court noted
that it did not “have the benefit of an express agency position on [implied
preemption],” id. at 61 ¶ 26, the Agency’s March 2020 notice explicitly
addresses preemption and disavows a preemptive intent. Therefore, given
Dashi’s errant reliance on Geier’s analytical framework and the expanded
record that now includes an express Agency view on preemption since it
was decided, we overrule Dashi.
3. Sprietsma v. Mercury Marine
¶52 In Sprietsma, a passenger fell overboard from a boat and
struck the propeller blade resulting in fatal injuries. 537 U.S. at 54. Notably
and like the Agency’s action in our case, the Coast Guard had declined to
promulgate a regulation concerning the equipment in question, specifically
one that would have required propeller guards on outboard motors. Id. at
61–62. After concluding that the authorizing congressional enactment in
question did not preempt the plaintiff’s claims, the Court then considered
whether the decision by the Coast Guard to forego regulating propeller
guards was entitled to preemptive effect. Id. at 62–64.
¶53 Although the state supreme court below had concluded “that
the Coast Guard’s failure to promulgate a propeller guard requirement here
equates to a ruling that no such regulation is appropriate pursuant to the
policy of the [Federal Boat Safety Act],” the Court noted its conclusion did
not account for the Coast Guard’s entire explanation for declining to
regulate propeller guards:
The regulatory process is very structured and stringent
regarding justification. Available propeller guard accident
data do not support imposition of a regulation requiring
propeller guards on motorboats. Regulatory action is also
limited by the many questions about whether a universally
acceptable propeller guard is available or technically feasible
in all modes of boat operation. Additionally, the question of
retrofitting millions of boats would certainly be a major
economic consideration.
Id. at 66 (citation omitted). According to the Court, “[t]his statement
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reveal[ed] only a judgment that the available data did not meet the [Federal
Boat Safety Act’s] ‘stringent’ criteria for federal regulation.” Id. at 66–67.
Importantly, “[t]he Coast Guard did not take the further step of deciding
that, as a matter of policy, the States and their political subdivisions should
not impose some version of propeller guard regulation, and it most
definitely did not reject propeller guards as unsafe.” Id. at 67.
¶54 The Court thus concluded that “although the Coast Guard's
decision not to require propeller guards was undoubtedly intentional and
carefully considered, it [did] not convey an ‘authoritative’ message of a
federal policy against propeller guards.” Id. As for any conflict with a state
tort suit, the Court observed that “nothing in [the Coast Guard’s] official
explanation would be inconsistent with a tort verdict premised on a jury’s
finding that some type of propeller guard should have been installed on
this particular kind of boat equipped with respondent's particular type of
motor.” Id.¶55 The fact that the matter before us similarly lacks a
promulgated safety standard addressing the equipment in question and
involves a similar agency action—the denial of a petition for rulemaking—
renders Sprietsma more relevant to our case than Geier. Sprietsma is also
instructive with respect to weighing an agency’s judgment in our
determination of whether the Agency has conveyed an authoritative
message concerning the regulation of AEB for our preemption analysis.
4. Williamson v. Mazda Motor of America, Inc.
¶56 The court of appeals also identified Williamson as a case
bearing on the analysis of Varela’s claims. We agree. Williamson dealt with
the same authorizing Act and FMVSS as Geier did, albeit an older version
of the FMVSS. Williamson, 562 U.S. at 326–27. The plaintiff’s design defect
claim was based on the manufacturer’s alleged failure to install the proper
seatbelt in a rear inner passenger seat. Id. at 327. The FMVSS gave
manufacturers a choice to use either a lap belt or a lap-and-shoulder-belt on
rear inner seats, such as the middle seat of a minivan. Id. at 326.
¶57 The issue was whether the regulation affording
manufacturers a seat belt option preempted a tort suit that would have
required a specific seat belt. Id. Although the safety standard provided
manufacturers with options, the choice provision alone was not dispositive.
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Id. at 332. Reviewing the record before it, the Court distinguished the
decision to permit manufacturer choice in seatbelts from the passive
restraint system options permitted in Geier. Id. at 333. Instead of being
based on safety, “[t]he more important reason why DOT did not require
lap-and-shoulder belts for rear inner seats was that it thought that this
requirement would not be cost effective.” Id. at 335. While acknowledging
an agency could preempt state tort suits based on a cost-effectiveness
judgment, the Court observed that such a judgment “cannot by itself show
that DOT sought to forbid common-law tort suits in which a judge or jury
might reach a different conclusion.” Id. Lastly, the Court considered the
Agency’s own view that the regulation in question did not preempt the suit
before the Court and harkened back to the explanation from the Solicitor
General in Geier “that a standard giving manufacturers ‘multiple options
for the design of’ a device would not pre-empt a suit claiming that a
manufacturer should have chosen one particular option, where ‘the
Secretary did not determine that the availability of options was necessary
to promote safety.’” Id. at 335–36 (citation omitted).
¶58 Williamson is thus useful in our case for considering what
weight, if any, to give to the Agency’s judgment in determining the
preemptive effect of the denial to engage in AEB rulemaking in 2017. The
caution against inferring an intent to preempt state law solely based on an
agency’s judgment to permit choice among available safety devices is
equally informative.
III. Conclusion
¶59 We conclude that the Agency has neither conveyed an
authoritative statement establishing manufacturer choice as a significant
federal policy objective nor made explicit a view that AEB should not be
regulated. The record also does not reflect an intent to restrict regulation of
automated vehicles and automated driving systems beyond traditional
federal regulatory authority nor is there a definitive statement that states
may not regulate. To the contrary, the Agency has acknowledged that
states have regulated and are continuing to regulate in the field of
development and deployment of automated driving systems and has
encouraged states to undertake a review of how liability may be affected in
an automated driving system environment. What is likewise evident
throughout the entirety of the regulatory record is the Agency’s emphatic
commitment to partnering with states to facilitate the ongoing development
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and safe deployment of automated vehicle and automated driving system
technology, of which AEB is a component.
¶60 To the extent the administrative record reflects a federal
policy about AEB technology, it is that the Agency encourages AEB
innovation and desires it be deployed more broadly and sooner rather than
later. Because Varela’s claims are focused on the availability of FCW+
across all trim levels of the Jeep Grand Cherokee, they are not in conflict
with any identified Agency objectives or policies. Accordingly, we find her
claims are not preempted by the doctrine of implied obstacle preemption.
¶61 Geier is inapposite to the facts and record before us and
therefore does not control our decision, and we overrule Dashi. Given the
nature of the administrative record before us and the exercise of the
Agency’s judgment to forego formal rulemaking, Sprietsma and Williamson
provide the appropriate guidance for our determination.
¶62 We affirm the court of appeals but vacate ¶¶ 11–22 of the
opinion, reverse the trial court’s order, and remand the case to the trial court
for further proceedings.
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