Also known as: preemption · preempt · preempts · preempted · preempting · preemptive · federal preemption
Written by attorneys · grounded in primary & secondary sources — see below
3 senses
A constitutional doctrine under which federal law supersedes conflicting state law pursuant to the Supremacy Clause. The doctrine applies when Congress intends to occupy a field or when state law stands as an obstacle to federal objectives. It also encompasses limits such as the anti-commandeering principle that prevents Congress from directly ordering state legislatures or officials.
A constitutional doctrine under which federal law supersedes conflicting state law pursuant to the Supremacy Clause. The doctrine applies when Congress intends to occupy a field or when state law stands as an obstacle to federal objectives. It also encompasses limits such as the anti-commandeering principle that prevents Congress from directly ordering state legislatures or officials.
Select any source to read its text and confirm it supports the definition.
A shareholder right to acquire a proportional share of a corporation's unissued shares when the board decides to issue them. The right exists only to the extent the articles of incorporation expressly provide for it. Absent such a provision, the board may issue shares to new investors without first offering them to existing shareholders.
Select any source to read its text and confirm it supports the definition.
A federal statute whose requirements for a security interest to obtain priority over lien creditors displace the UCC's ordinary filing rules for perfection. When such a federal statute governs the collateral, compliance with its certificate-of-title or other system satisfies perfection without a financing statement under Article 9.
Select any source to read its text and confirm it supports the definition.
A shareholder right to acquire a proportional share of a corporation's unissued shares when the board decides to issue them. The right exists only to the extent the articles of incorporation expressly provide for it. Absent such a provision, the board may issue shares to new investors without first offering them to existing shareholders.
A federal statute whose requirements for a security interest to obtain priority over lien creditors displace the UCC's ordinary filing rules for perfection. When such a federal statute governs the collateral, compliance with its certificate-of-title or other system satisfies perfection without a financing statement under Article 9.
Each sense below has its own examples, sources, and questions.
State legislators in State X enact a statute authorizing licensed sports betting at casinos. A federal law prohibits states from authorizing such schemes. The federal prohibition is held invalid because it directly commands state legislatures rather than regulating private conduct. State X may therefore proceed with its licensing program without federal preemption.
New Jersey enacts a statute barring importation of solid waste from other states for disposal in its landfills. Out-of-state generators challenge the ban as an unconstitutional burden on interstate commerce. The Court holds that the statute discriminates against interstate commerce on its face and is therefore invalid under the dormant Commerce Clause regardless of any asserted health or environmental justification.
Allstate refuses to pay no-fault benefits to Shady Grove Orthopedic Associates after an automobile accident. Shady Grove files a class action in federal court under diversity jurisdiction. A New York statute prohibits class actions to recover statutory penalties. The Supreme Court holds that Federal Rule of Civil Procedure 23 governs the availability of class actions in federal court and therefore preempts the conflicting state procedural limitation.
MITE Corporation launches a tender offer for shares of an Illinois corporation with shareholders nationwide. Illinois applies its takeover statute to the offer even though the target is incorporated elsewhere. The statute imposes a waiting period and hearing requirements that apply to offers directed at any resident shareholder. The Supreme Court holds that the statute's extraterritorial reach unduly burdens interstate commerce and conflicts with the federal Williams Act, rendering it preempted.
Yes. The doctrine prohibits Congress from issuing direct orders to state legislatures dictating what they may or may not do. A federal statute that targets state legislative action rather than regulating private conduct is invalid under the anti-commandeering principle.
Supporting sources
Congress may expressly authorize states to discriminate against interstate commerce in specified ways. When such authorization exists, the state measure does not violate the dormant Commerce Clause.
Supporting sources
Perry Pratt owns common shares in Platinum Partners. The board votes to issue new common shares at a discount to an outside investor. The articles of incorporation contain no provision granting preemptive rights. Pratt therefore has no right to purchase a proportional block of the new shares and cannot prevent dilution of his ownership percentage.
No. Under modern corporate statutes, preemptive rights exist only if the articles of incorporation expressly grant them. When the articles are silent, the board may issue new shares to outside investors without first offering them pro rata to existing shareholders.
Supporting sources
Pedro Pacheco buys a small plane on credit from Prime Logistics. Prime claims a security interest but never files a financing statement under Article 9. A federal aviation statute requires notation of the interest on the FAA certificate of title to gain priority over lien creditors. Because the federal statute preempts the UCC filing requirement, Prime's interest is perfected without an Article 9 filing statement.
A federal statute, regulation, or treaty preempts the UCC filing requirement when it supplies its own rules for a security interest to obtain priority over lien creditors. In that situation, compliance with the federal system perfects the interest without an Article 9 financing statement.
Supporting sources
…535 U. S. 391, 411 (2002) (O’Connor, J., concurring). Therefore, although I adhere to my views on purposes-and-objectives pre-emption, see Wyeth v. Levine , 555 U. S. 555, (2009) (opinion concurring in judgment), I reluctantly join the Court’s opinion. I The FAA generally requires courts to enforce arbitration…