Federal Agency Research and Review

Federal Agency Research and Review

University of Phoenix, School of Business

Business Law



This is a compilation in discussion of the four federal agencies and providing an example of each. I was tasked with providing one real world example of a business entity that each agency regulates and explain the effects of the regulations on that entity. The compilation below are examples provided from the course textbook along with other outside sources.

U.S Securities and Exchange Commission

The purpose of the Securities and Exchange Commission is to protect investors, as well as to keep markets fair and efficient and enable the creation of capital to encourage economic growth. This involves protecting the savings of American citizens so they can feel more secure when they invest in things like stocks, bonds, and other securities.

An example of the Securities and Exchange Commission appearing before the Supreme Court involved citrus groves in the state of Florida. W.J. Howey Co. and Howey-in-the-Hills Service, Inc. were two corporations formed in Florida, where Howey owned several citrus groves. Half of these groves he kept for his own use, while he sold real estate contracts for the other half in order to be able to finance any future developments that needed to be made.

This meant that he would sell a part of the grove to the investor, while also having them enter into a service contract that would allow farming on that particular plot of land. This service contract allowed Howey to continue to enjoy “full and complete” possession of the land due to the investor not participating in the farming in any way whatsoever. Where Howey got into trouble was in failing to register the SEC-required paperwork in his frequent interstate commerce transactions. The SEC filed a lawsuit seeking an injunction against Howey’s participation in interstate commerce.

The trial court denied the SEC’s request, holding that the contract arrangement did not actually provide the sale of those securities. The court of appeals affirmed the lower court’s decision, and so the case was brought before the Supreme Court, where certiorari was granted. Ultimately, it was decided that yes, Howey did act in such a way that violated the Securities Act of 1933.

U.S. Environmental Protection Agency (U.S. EPA)

The idea of out-of-control bureaucrats has become a major topic of discussion in politics, with debates over the role of the Environmental Protection Agency (EPA) rising to the level of nationalized health care and government bailouts. Measures taken to protect the environment are necessary and welcomed. But concerns for air quality should always be measured against the larger context of the economy and real-world achievability.

Here is a current examples of EPA’s neglect for this principle: EPA’s Frankenstein. “Boiler MACT” is the name given to EPA’s new standards aimed at cutting emissions from boilers used in industries like manufacturing and processing and in commercial use by the likes of malls and hospitals. Boiler MACT is an example of EPA regulating outside of reality. The Clean Air Act gives EPA authority to regulate boilers based on the best performing similar facilities. One could easily interpret this as monitoring facilities with the best pollution controls and then directing the industry to move towards similar technologies. Instead, the Agency looked at individual pollutants at facilities, cherry picked the best results, spiced them together, and set the bar there. Even if a facility is the worst polluter of a particular pollutant, it could still be considered a best performing facility if its emissions of another pollutant are low.

This approach has been dubbed the “Franken boiler” by industry — a facility created in a lab which does not exist in the real world. In testimony before a House committee, Paul Gilman, EPA official turned industry representative, compared this approach to “asking that the decathlon champion at the Olympics be able to win not only the overall decathlon, but all of the 10 individual events as well.”

Occupational Safety and Health Administration (OSHA)

OSHA is responsible for insuring that workers are afforded a certain level of workplace safety through training, outreach, and education. Additionally, OSHA enforces the safety standards set by the Occupational Safety and Health Act.

An employee filed a whistleblower complaint in 2011 stating his employer, Pan Am Railways, Inc., retaliated against him after he attempted to report an injury. Whistleblower complaints, handled directly by OSHA investigators, are filed when an employee feels their occupational safety concerns, reports, or information have been met with a discriminatory response. They protect the employee from further retaliation and launch a formal investigation.

In this case, OSHA investigated and concluded that the employee had been retaliated against when attempting to report an injury. They required Pan Am to pay the employee $50,000 in compensatory and punitive damages, but that wasn’t acceptable to Pan Am. The case was appealed twice with each judge maintaining OSHA’s findings and, on April 21, 2017, the U.S. Court of Appeals for the First Circuit denied further appeal. In fact, their appeals only increased the amount of punitive damages awarded to $250,000.

In the end, the employee rightfully reached out to OSHA and their investigation revealed his safety concerns were wrongfully violated, resulting in a $260,000 payout. It’s a reminder to companies to follow safety protocol instead of coercing an employee into submission.

U.S. Consumer Product Safety Commission (CPSC)

The CPSC is an independent federal regulatory agency with a public health and safety mission to protect the public from unreasonable risks of injury and death from consumer products. The U.S. Consumer Product Safety Commission announced a voluntary recall of certain consumer products with Toys “R” US in the year of 2007. Consumers should stop using recalled products immediately unless otherwise instructed. It is illegal to resell or attempt to resell a recalled consumer product. The recall involves the Imaginarium brand 213 Piece Wooden Coloring Case which includes crayons, pastels, colored pencils, fiber pens, paintbrush, pencil, water colors, palette, white paint, ruler and pencil sharpener in a light tan wooden carrying case. The case measures about 14 inches high by 19 inches wide.

The U.S. Consumer Product Safety Commission is charged with protecting the public from unreasonable risks of injury or death associated with the use of thousands of types of consumer products under the agency’s jurisdiction. Deaths, injuries, and property damage from consumer product incidents cost the nation more than $1 trillion annually. CPSC is committed to protecting consumers and families from products that pose a fire, electrical, chemical or mechanical hazard. CPSC’s work to help ensure the safety of consumer products – such as toys, cribs, power tools, cigarette lighters and household chemicals contributed to a decline in the rate of deaths and injuries associated with consumer products over the past 40 years.

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