TX Assn of Manufacturers v. CPSC, 989 F.3d 368

Background

Congress (CPSIA) required the Consumer Product Safety Commission (CPSC) to study phthalates in children’s toys/child care articles via a CHAP and to promulgate a final rule; an interim ban already covered several phthalates at >0.1%.
CHAP performed cumulative risk assessment using hazard quotients (HQs) and a hazard index (HI); CHAP applied uncertainty factors (100x) and used NHANES, SFF, and scenario data to estimate exposures.
The Proposed Rule tracked CHAP: flagged that ~10% of pregnant women had HI>1 and the HI at the 95th percentile was ~5, supporting prohibition for specified phthalates.
After the Proposed Rule, updated NHANES staff analysis (using women of reproductive age) found far lower population risk; staff observed only 2–9 individual spot samples with HI>1 in the sample and a 95th-percentile HI <1.
The Final Rule (3–2 vote) kept/expanded the DINP prohibition and banned four additional phthalates at >0.1% in children’s toys/child care articles; trade associations challenged the rule in this court.
The Fifth Circuit held it had jurisdiction, affirmed most substantive aspects, but found procedural errors: inadequate notice-and-comment for the Final Rule’s new reliance on individual spot samples and failure to consider costs when continuing the interim DINP prohibition; remanded for further proceedings.

Issues

Issue	Petitioners' Argument	CPSC's Argument	Held
Standing / associational standing	Trade associations (via member EMCC) face concrete economic and stigma injuries from the rule	Rule does not cause cognizable injury to petitioner members	Court: EMCC’s lost sales and stigma show injury traceable to the rule; at least one petitioner has standing, so case proceeds (but standing must cover each claim/remedy)
Jurisdiction — is Final Rule a “consumer product safety rule”?	Petitioners treat it as reviewable under CPSA §2060(a)	CPSC argued the rule is not a consumer product safety rule for purposes of direct review	Court: CPSIA expressly treats phthalate rules promulgated under §2057c(b)(3) as consumer product safety standards; federal courts have jurisdiction under §2060(a)
APA notice-and-comment (logical outgrowth)	Final Rule relied on individual spot samples / very high-percentile observations (unstable) — this was a new justification not fairly noticed	CPSC said it gave notice and solicited comments on new data and spot-sample issues	Court: CPSC materially changed its primary justification (from stable 95th-percentile population estimates to individual spot-sample observations) without adequate notice; violated APA — rulemaking not a logical outgrowth; remand required
Statutory standard & procedures (costs / “reasonable necessity”)	CPSC failed to consider costs and effects on utility/availability when continuing the interim DINP ban (statute requires action that is "reasonably necessary")	CPSC argued CPSIA’s §2057c(b)(3) governs and does not require §2058 findings; its approach to margin of safety is permissible	Court: §2057c(b)(3)(A) allows protective action but includes a "reasonable" qualifier; agency must take a hard look at costs/benefits when continuing the interim ban; failure to do so was procedural error requiring remand.

Key Cases Cited

Summers v. Earth Island Institute, 555 U.S. 488 (associational-standing principles)
Friends of the Earth v. Laidlaw, 528 U.S. 167 (standing elements)
Davis v. Federal Election Comm'n, 554 U.S. 724 (standing must be shown for each claim/remedy)
Chevron U.S.A. Inc. v. Nat'l Res. Def. Council, Inc., 467 U.S. 837 (agency deference framework)
Michigan v. EPA, 135 S. Ct. 2699 (agencies must consider costs when statute requires or when interpretation demands it)
Sierra Club v. EPA, 895 F.3d 1 (interpretation of margin-of-safety-like statutory language)
Motor Vehicle Mfrs. Ass'n v. State Farm, 463 U.S. 29 (arbitrary-and-capricious review standard)
Fox Television Stations, Inc. v. FCC, 556 U.S. 502 (deferential review; uphold agency if path reasonably discernible)