Motor Vehicle Manufacturers Association of the United States, Inc. v. State Farm Mutual Automobile Insurance Company

PETITIONER: Motor Vehicle Manufacturers Association of the United States, et al.
RESPONDENT: State Farm Mutual Automobile Insurance Company, et al.
LOCATION: National Highway Traffic Safety Administration

DOCKET NO.: 82-354
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: United States Court of Appeals for the District of Columbia Circuit

CITATION: 463 US 29 (1983)
ARGUED: Apr 26, 1983
DECIDED: Jun 24, 1983
GRANTED: Nov 08, 1982

ADVOCATES:
James F. Fitzpatrick - on behalf Respondents
Lloyd N. Cutler - on behalf of Petitioners, Motor Vehicle Manufacturers Association of the United States, et al
Rex E. Lee - on behalf of Petitioner, the United States Department of Transportation

Facts of the case

In 1966, Congress passed the National Traffic and Motor Vehicle Safety Act of 1966, which gave the Secretary of Transportation the power to issue motor vehicle safety standards. The Secretary also has the ability to delegate that power to another agency, in this case the National Highway Transportation Safety Administration (NHTSA). The Act also authorizes judicial review to determine whether the NHTSA acted arbitrarily and capriciously.

In 1967, the Department of Transportation first issued Standard 208, which at that point only required all automobiles to have seat belts. By 1975, Standard 208 had been revised multiple times to require passive restraints, such as airbags and seat belts that would operate automatically and not require action on the part of the occupants. Because of the unpopularity of the standard, in 1974 Congress amended the Act to allow alternative safety measures. In 1976, Secretary of Transportation William Coleman suspended the passive restraint requirement entirely. The succeeding Secretary of Transportation, Brock Adams, issued Modified Standard 208, which required passive restraints in large cars of model year 1982 or later and in all cars of model year 1984 or later. In 1981, Secretary of Transportation Andrew Lewis began reconsidering Modified Standard 208. The NHTSA rescinded the passive restraint requirement of Modified Standard 208 because it determined that the restraints would not have the expected safety benefits, so the requirement would not be reasonable or practicable.

State Farm Mutual Automobile Insurance Company and the National Association of Independent Insurers filed for review of the NHTSA’s decision, and the U.S. Court of Appeals for the District of Columbia Circuit held that the NHTSA’s decision to rescind the standard was arbitrary and capricious. The Court of Appeals held that there was not enough evidence to support the NHTSA’s position and that the NHTSA failed to properly consider alternative possibilities under which the standard could be effective.

Question

Was the NHTSA’s decision to rescind Modified Standard 208 arbitrary and capricious?

Media for Motor Vehicle Manufacturers Association of the United States, Inc. v. State Farm Mutual Automobile Insurance Company

Audio Transcription for Oral Argument - April 26, 1983 in Motor Vehicle Manufacturers Association of the United States, Inc. v. State Farm Mutual Automobile Insurance Company

Audio Transcription for Opinion Announcement - June 24, 1983 in Motor Vehicle Manufacturers Association of the United States, Inc. v. State Farm Mutual Automobile Insurance Company

William J. Brennan, Jr.:

The decision in 82-354, Motor Vehicle Manufacturers Association versus the Insurance Company and two companion cases will be announced by Justice White.

Byron R. White:

These cases are here from the Court of Appeals for the District of Columbia Circuit.

In 1966, Congress passed the National Traffic and Highway Safety Act which among other things required that the Secretary of Agriculture formulate an issue, Highway Safety Standards.

The Secretary delegated his authority to the National Highway Traffic Safety Administration.

That agency, among other things, issued Safety Standard 208 which at that time simply required that new cars have seat belts.

Over a period of time however, and after much pulling and hauling, the agency issued a Modified Standard 208.

That standard among other things required that after certain date, new cars would be equipped either with airbags or with automatic seatbelts.

These were the so-called passive restraints and that they -- and they are used, didn't require – didn’t depend on the volition of the driver or the other occupant of the car.

That standard to say the least was controversial.

There were many developments and eventually the agency revoked or rescinded Modified Standard 208 insofar as it required any passive restraint.

After that, the aim of the decision was to eliminate the requirement for either airbags or automatic seatbelts.

The decision was challenged in the Court of Appeals successfully, the Court of Appeals holding and that their rescission was arbitrary capricious.

The Motor Vehicle Manufacturers Association and others brought the cases here and we granted certiorari.

Although our approach to the case is somewhat different from Court of Appeals, we also hold the rescission to have been arbitrary and -- and capricious.

Agencies are required to give reasons for their action and to explain the basis for their decisions.

That standard was not satisfied here.

The entire focus of the rescission action was on automatic seatbelts.

No attention was given to -- or no explanation was given as to why the airbag requirement was rescinded along with the automatic seatbelt requirement and that the agency must explain.

We also have concluded for reasons, we've given an opinion that the explanation for rescinding the automatic seatbelt requirement was also inadequate in certain respects.

Accordingly, the judgment of the Court of Appeals is vacated.

The cases are returned to that Court so that they may be returned to the agency for proceedings consistent with our opinion.

The opinion is unanimous except for Parts 5 (b) and Part 6.

Justice Rehnquist has filed an opinion concurring in part in dissenting and part in which he explains why he, the Chief Justice, and Justices Powell and O'Connor do not join those two parts of the opinion.

William J. Brennan, Jr.:

Thank you Justice White.