Regulatory Focus™ > News Articles > Proposed Bill Would Limit Use of Consent Decrees, Settlement Agreements

Proposed Bill Would Limit Use of Consent Decrees, Settlement Agreements

Posted 06 February 2012 | By Alexander Gaffney, RAC 

A bill introduced in the US House of Representatives by Reps. Ben Quayle (R-AZ), Dennis Ross (R-FL) and Howard Coble (R-CA) would place "limitations on consent decrees and settlement agreements by agencies."

Consent decrees are voluntary judicial judgments entered in to by two or more willing parties, usually in return for the dismissal of other charges. The US Food and Drug Administration (FDA) frequently uses consent decrees against manufacturers. A recent example of this is FDA's 26 January 2012 consent decree against Ranbaxy for alleged manufacturing and data integrity deficiencies found at several US- and Indian-based manufacturing plants.

The Sunshine for Regulatory Decrees and Settlements Act of 2012 (H.R. 3862) would govern the use of consent decrees by adding a layer of transparency to the process, but would also make it more difficult for agencies to obtain a consent decree or settlement.

Section 2 (b)(2) of the proposed legislation bans agencies from filing a court motion for a consent decree until "the conclusion of an opportunity for affected parties to intervene in the action." Taken out of judicial parlance, consent decree actions would be subject to a public comment period similar to proposed regulations or guidance documents.

The legislation also allows addition parties to intervene in consent decree court proceedings, and requires an agency to "publish any proposed consent decree or settlement agreement for public comment before filing it with the court." This is for the purpose of allowing amicus curiae briefs to be filed with the court.

Quayle said in a press release that he hopes the legislation will "restore greater transparency and accountability to the rulemaking process."

The bill has been referred to the House Judiciary Committee for review.

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