Admin Outline—Pierce—Fall 2012

I. AGENCYa. An agency is an entity that has "substantial independent authority" MUST be able to adjudicate disputes and/or

issue rulesi. A variety of support functions are not enough!

b. Types of Agenciesi. Executive Agencies: Cabinet agencies sub agencies within each Cabinet, headed by a single Secretary

1. Agencies with administrators who only work for the President / appointed and removed by ii. Hybrid Agencies: like a commission

1. Free-standing agencies (like the FTC, SEC)iii. Independent agencies headed by commissions / multi-member bodies (odd number of people, terms are

staggered) insulated from political pressure and control iv. Courts largely ignore definition in APAv. President is not an agency [Franklin v. Massachusetts]

c. Agency’s job is to provide support services operational and administrative in nature – [CREW Case]i. Agencies are inferior to Congress, President and Courts

1. Agency power is drawn from the three branches of government 2. With President’s signature/acquiescence, Congress enacts legislation that assigns an agency

responsibility and thus some authority and discretion, to administer a statute by enforcing its reqs and/or pursuing its goals

3. Congress can enact legislation imposing procedural hurdles that agencies must surmount before they can act

4. Presidents have control in that they can appoint officials (with advice and consent of Senate) and push agendas

d. Quasi Functions of Agenciesi. Judicial: closed and politically neutral

ii. Legislative: open and intensely politicalII. ADMINISTRATIVE PROCEDURE ACTa. To determine which procedure to use: Agency’s rules (sometimes not clear or consistent with statute) Agency

statute (conjunction with APA) Due Process Clause (history, tradition, balancing of interests, natural rights)b. A general statute that applies to most federal ad law decisionsc. History of the Law

i. FDR brings about the New Deal / increased power of government through agencies (“unregulated market forces produced a mess, so need more government regulation”)

1. Liberal dems – people who believed FDR was right and gave government lots of power / agency discretion

2. Conservative repubs – rallied against FDR, called for safeguards, elaborate decision making procedures for agencies, their power has to be subject to judicial review

d. Judicial Review is covered in Sections 701-706i. §701: apply UNLESS statute precludes it or action is committed to agency discretion by law

ii. §704: actions are reviewable if made reviewable by statute or final agency action for which there is no adequate court remedy

iii. §706: Courts can strike down agency action that’s a&c, abuse of discretion, not in accordance with law, contrary to constitutional rights, in excess of statutory jurisdiction, w/o proper procedure, unsupported by substantial evidence (formal) or unwarranted by facts (de novo review)

e. Procedures covered in Sections 551-559i. Formal Adjudication: 554-557

1. Trial like proceedings 2. ONLY required if statute says “on the record only after opportunity for hearing”

ii. Informal Adjudication: 5551. MAJORITY of decisions

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2. Use whenever statute authorizes adjudication without issuing magic words 3. A lot of discretion for the agency

iii. Informal Rulemaking: 553 (3 step notice + comment)1. Publication of notice of proposed rulemaking2. Solicitation and consideration of industry/expert comments

iv. Issuance of final rule accompanied by rationale reasons f. Formal Rulemaking: 553, 556-557

i. 4 step process: Notice, comment, issuance of final rule, AND oral evidentiary hearing subject to cross examination

g. Must be read in conjunction with statute that authorizes agency action for the issue (organic act)III. DUE PROCESS

a. Adjudication and Agenciesi. Remember: Most agencies adjudicate far more cases than all courts combined, vary in their

complexity, formality and scopeb. Due Process

i. 5th amendment: no person shall be deprived of life, liberty, or property without due process of lawii. Influences agency procedures in indirect ways

1. Congress chooses the procedure it requires an agency to use to resolve a class of adjudications influenced by its beliefs with respect to the due process requirements

2. Congress often leaves an agency considerable discretion to choose the procedures it will use to resolve a class of adjudications

c. When does Due Process Apply?i. Act in question must deprive individual of life, liberty or property

1. ONLY APPLIES TO ADJUDICATION NOT RULEMAKING 2. Adjudication affects individuals, rulemaking affects groups

a. Assessment of tax for the cost of paving a street on lands abutted to P, owed notice+ oral hearing [Londoner v. Denver]

b. Where a rule of conduct applies to more than a few people, it is impracticable that everyone should have a direct voice in its adoption [Bi-Metallic Investment Co v. State Board of Equalization]

3. Policy reasons: a. Due process does not require the gov’t to provide a hearing before it takes action that

adversely affects a class of individualsb. Not pragmatic, prohibitively expensive to have hearings for allc. Only refuge for an individual singled out for adverse treatment is the judicial process,

large groups protected by legislatureii. Analysis

1. Is this adjudication?a. Look to the nature of the facts

i. Are they historical facts unique to an individual aka adjudicative facts? ii. Or are they legislative facts that help a govt institution decide questions of

law, policy and discretion 2. Does the action deprive of life, liberty, or property?

a. Life-Probably never deprivedb. Liberty

i. Freedom from Incarcerationii. Freedom from Official Stigmatization with Deprivation of Tangible Interest

1. Constantineau:a. P’s name on list of drunks, prevented from buying

2. Paul v. Davis:

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a. Stigma + TEST: when the stigmatization is coupled with deprivation of something tangible (like buying alcohol, untenured job)

b. In this case, list of shoplifters sent to stores was not enoughiii. Freedom from suffering adverse consequences as a result of exercising a

constitutional right 1. Roth:

a. Cannot be punished for exercising liberty interest in free speech

b. But if you’re fired in a way that doesn’t hurt your reputation – no protected interest

2. Applies in government employment cases where employees are fired for religious beliefs even if they’re “at will.”

c. Propertyi. Is there a statutorily conferred benefit on a class of persons (LOOK FOR THE

WORDS ENTITLEMENT) or a job that only allows firing for cause?1. Golberg v. Kelly: statute confers an entitlement to AFDC benefits

ii. State common law property Interestiii. Real property interest iv. Is there a contract?

1. Bd of Regents v. Roth; Perry v. Sinderman (1972):a. Government jobs

i. Was there a mere unilateral expectation? (Roth) Then no property interest

ii. if K says we will not fire you unless we have a good reason, i.e. in faculty guide-->justified expectation-->property interest (Sinderman)

2. Highly unlikely that they meant to include contract rights into property rights that could be deprived without a hearing

3. Loudermill (1985)a. Ohio statutes say you’re not entitled to pre-firing hearings,

but can have a post-firing hearing. Court said that’s inadequate, must be some kind of pre-firing hearing, even if written or informal coupled with post termination admin procedures in statute

b. 8 justices talk about procedures to which someone is entitled is in the Court’s purview, not legislatures

i. Rehnquist alone in writing dissent staying with bitter+sweet

c. No deprivation of liberty interest in this case3. What process is due the person?

a. ***remember, the gov’t can deny these things from citizens but has to put in safeguards

b. Apply Mathews v. Eldridge Factorsi. Facts: guy deprived of SSI

ii. THREE PART BALANCING TEST:1. Importance of the interest at stake (governmental and private)

a. State interest can’t be monetary value, not objective amounts in cost comparisons

b. It’s a subjective inquiry – based on the values of the decision maker

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2. Risk of error and incremental value of added procedures and cost of added procedures

a. Written medical reports “reliably” describe condition3. Government interest in promoting efficiency

a. Administrative costs and financial burden b. [hard to apply and hard to predict]

iii. Why distinguish from Goldberg?1. Disability beneficiaries have less need (What about degrees of

disabled)2. Doctors have a ability better to communicate in writing3. Issues in disability cases are more objective in nature4. Courts were applying Goldberg to require oral hearings in many

contexts many agencies complained about the cost of complianceiv. Due process requires that recipients of a contingent statutory entitlement to

anything have a pre-termination of benefits hearing [Goldberg v. Kelly]1. Have to weigh recipients (means to live by) interest with the gov't

interest in summary adjudication 2. Doesn’t have to be a quasi judicial trial, just the basic procedural

safeguards:a. Opp to be heard, timely and adequate notice, opportunity to

defend by confronting adverse witness and presenting own arguments

3. Dissent: entitlements are a privilege NOT a rightv. Face-to-face sit down satisfies due process (Goss v. Lopez student suspension

case)c. OR Just Pass the Trash

i. To avoid awarding due process, fire someone before they receive tenure but without specifying the reason, i.e. abusing kids

1. If you have a pre term hearing, they’ll have tenure by the time you’re done

2. If you fire for sexually abusing kids then stigma + (liberty interest revoked)

3. Pass the trash, fire the guy and when someone calls for a reference you don’t say the real reason

d. Bitter with the Sweet (Rehnquist)i. If an individual relies on a statute as the basis for the right that is protected by

due process, he must take the bitter with the sweet, i.e. he must accept the procedural contours of the right along with the substantive contours of the right

1. Arnett v. Kennedy (plurality), Bishop v. Wood (majority), embraced by circuit courts until Loudermill

e. What process is due to a US Citizen held on US soil as an enemy combatant [Hamdi v. Rumsfeld]

i. Balance of private and gov’t interest: We hold that although Congress authorized the detention of combatants in the narrow circumstances alleged here, due process demands that a citizen held in the US as an enemy combatant be given a meaningful opp to contest the factual basis for that detention before a neutral decision-maker + hearsay and presumption for US

1. 5 – Justices dissenting – 4 would require more, 1 would require lessIV. STATUTES AS A SOURCE OF PROCEDURAL REQUIREMENTS

A. Statutes often require agencies to use decision making procedures greater than or at least different from the procedures required by due process

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I. Note: If an agency adopts procedural rules that exceed those required by statute or by due process, the agency is required to follow its own rules to the extent that the confer important procedural rights on parties

B. APAI. Formal Adjudication

1. Section 554-8 of the APA describe the procedures that are potentially required in adjudications

2. Formal adjudications look like court trial: ALJ, oral evidentiary, writes opinion including findings of fact and conclusions of law

3. ALJs are independent of agencies, no control over them4. Formal adjudication procedures kick in with the words "on the record after opp for an

agency hearing"5. What is a hearing?

a. Chevron v. Natural Resources Defense Council Inc:I. Said that the use of the phrase public hearing did not trigger formal

adjudication procedures1. The word “hearing” is ambiguous, and agency’s interpretation

was reasonable (highly deferential)b. Dominion Energy Brayto Point v. Johnson

I. OK for EPA to deny Ps request for a formal evidentiary hearing after issuing a proposed final National Pollution Discharge Elimination System permit

II. EPA took the time to investigate and adopt a final rule that hearings don't have to be evidentiary which is why they denied Ps request

1. Deference to this reasonable interpretation II. Informal Adjudication

1. No magic words, free to use informal adjudication (US v. Florida East Coast RR Co)A. The requirement of a “hearing” does not require the ICC to hear oral testimony,

to permit cross exam or hear oral argumentB. This was technically a rulemaking but since Chevron no court has held that a

“hearing” required formal adjudication2. Citizens to Preserve Overton Park v. Volpe:

A. Formal findings were not required, but we do not believe that in this case judicial review is based solely on litigation affidavits was adequate since don’t constitute whole record

3. Pension Benefit Guaranty Corp v. LTV Corp a. If due process is not implicated, and organic act does not require further

procedures, then only need to follow APA B. Informal process usually includes

I. Notice of issues presentedII. Opp to present arguments in either oral or written form

III. Decision of a neutral decision makerIV. Statement of reasons for decision

1. If the decision is later reviewed by a court and they need further information to determine if A and C, they will ask decision maker for a further statement of reasons

V. SEPARATION OF POWERS a. Due Process requires a neutral decision maker, free of impermissible biasb. Judicial Models

i. Separation of Functions 1. Admin agencies often possess and exercise both the power to enforce the law and the

authority to adjudicate

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2. APA says neutral decision maker=segregating the investigative and prosecutorial function from that of the decision maker

a. APA 554d Prohibits employees serving as adjudicators from performing investigative or prosecutorial functions and vice versa

b. Agency individual can make preliminary decisions and final decision in adjudication [Withrow v. Larkin]

i. Potential biases are relational, pecuniary 1. The more attenuated the more likely they are allowed

ii. Viewpoints should never be the basis for a disqualification1. Laird v. Tatum – people wanted Justice Rehnquist to recuse

himself from one case that he had background ona. Any Justice that knows something would get recused

from case with expertise2. But see Ward – mayor of a small town that gets half their

revenue from speeding tickets, decisions of guilt or innocence were made by mayor of city – court said no

3. Adjudicators must proceed in an impartial mannera. Only applies to formal adjudications, and APA says that agency can substitute

its opinion for that on an ALJ (557(b) and Supreme Court in Universal Camera)i. When an agency replaces its opinion for that of an ALJ, the reviewing

court can look at the WHOLE RECORD, including what was rejected by the agency (Universal Camera)

ii. Split Enforcement Model1. Alternative to the APA model is the split-enforcement model, dividing responsibility for

investigation and enforcement from adjudicationa. IE OSHA for rules and OSHRC for adjudications; same for mine safetyb. Most often used

iii. Judicial Model Versus the Bureaucratic Model1. Judicial Model

a. Constitution designed to insulate federal judges from external pressure, same for APA and ALJs

i. But independent judicial minds can lead to deciding case in different manners--> led to enormous disparities in results

ii. Agencies are allowed to improve quality and efficiency of the work of ALJs (Nash v. Bowen) [peer review, monthly production goals, quality assurance system to lower backlog]

2. Bureaucratic Modela. Other countries use a system with greater accuracy, consistency and efficiency

where decisions are made by teams who are organized hierarchically and who are instructed to apply objective, verifiable criteria which are constantly reevaluated

c. Adjudication processi. Appt ALJ randomly from those available

ii. Set up the case in the same wayiii. Briefing scheduleiv. Come out with his findingsv. Agency can then adopt the findings of the ALJ as their own (rare)

1. Other times they say that they think the ALJ got it wrong, and will explain with reference to record evidence why we have our findings instead of his (more common)

vi. Supreme Court opinion on this issue 1. Ct must uphold if supported by such relevant evidence as a reasonable mind might

accept as adequate to support a conclusion (Consolidated Edison-highly deferential

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standard) considering both the evidence that supports the finding and the evidence that detracts from the finding

a. Substantial evidence applies to formal adjudication, arbitrary and capricious applies to informal adjudication (ADP v. Board of Governors)

i. Formal Adjudication decisions must be based on SUBSTANTIAL EVIDENCE

1. Hearsay is not substantial evidence2. Finding contrary to un-contradicted testimony is not usually

supported by substantial evidence3. Evidence that is slight or sketchy in an absolute sense is not sub

evid4. Slight in relation to much stronger contrary evid is not sub evid5. ALJs finding contrary to an agency finding can lead a court to

think agencys decision is not sub evid6. Dissenting opinions by members of an agency 7. Engaged in a consistent pattern of crediting the agency's

witnesses and discrediting opposing witnesses8. Written medical reports by independent experts is substantial,

even though its hearsay (Richardson v. Perales)ii. Informal decisions ARB and CAPRICIOUS applies

1. Agency must engage in reasoned decision making a. How did you reason from this finding to this piece of

evidence...etc2. Agency must explain departures from precedent (Yang and Fox)

a. Mass justice agencies do not have precedent, ie SSA there are too many of them

b. But in other agencies there are precedents i. You can say we are applying this precedent, but

if you are not you have to explain why!2. Note: When they findings of the agency and ALJ differ, there is a higher chance of

reversal a. The court is supposed to considered the findings of the ALJ as well

VI. RULEMAKINGa. Types of Rule:

i. Legislative AKA substantive rules1. Same legally binding effect as statutes2. Congressional authorization necessary before an agency may promulgate rules

ii. Nonlegislative: interpretative rules, procedural rules, and policy statements 1. APA calls them inter. rules, general statements of policy, or rules of agency organization,

procedure, or practice2. Not legally enforceable against the public, many bind agency employees

b. Overall Rulemakingi. If an agency has the power to issue rules, and the rules are not ‘required by statute to be

made on the record after opportunity for agency hearing,’ the agency must:1. Issue a notice of proposed rulemaking in which it describes the proposed rules

a. 553 literal language doesn’t require much in the notice, just issues to be addressed (courts have added more)

b. statement of time, please and nature of proceedings (200-600 pages)2. Solicit, receive, and consider comments from the public re: the proposed rules (1000 to

1 million pages)3. And incorporate in the final rules a ‘concise general statement of their basis and

purpose’

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a. Hearings ALWAYS can be satisfied by a written exchange of views b. Unless a statute says something to the contrary or has the magic words

4. Publish final rule no later than 30 days before its effective dat 5. allow a right to petition

c. Agency Power to Issue Rules i. Most statutes make it clear that an agency shall or may issue rules to accomplish a particular,

statutorily-identified purposeii. Other statutory delegations are more general, providing only that an agency may promulgate

rules as necessary to effectuate the statute's provisions1. Occasionally a court has to decide whether an agency has the power to adopt leg rules

in the context of a statute not clear on the issue1. National Petroleum Refiners Assn v. FTC: statute says that the Commission can

prevent persons, partnerships, or corporations from using unfair methods of competition and may make rules and regs for the purpose of carrying out these provisions

1. Note: Congress later passed the FTC improvement act which confirmed right of FTC to make leg rules + added so many procedures that it abandoned efforts

2. Scholars say that court should only say agency has the rule to issue leg rules when it statute authorizes a court to penalize a party for violating the agency's rule

Advantages to Rulemaking

Fairness - Broader participation rights, better notice, application to all regulatees/ beneficiaries at same time (instant compliance)

Efficiency - Do not have to conduct never-ending hearings (save time, money)

Efficacy - Higher quality answers b/c public can participate through comments & provide input for decisionmaking; forward-looking focus on policy issues rather than idiosyncratic facts

Political accountability - Advanced notice, broader participation rights, transparency of policymaking process public can alert Congress as to what you are doing

Quality-higher quality due to broader input, focus on policy issues rather than idiosyncratic facts, and forward-looking instrumental approach.

Disadvantages to Rulemaking

Increased costs: State Farm & other decisions impose high costs on rulemaking process

Significant delays: Ct. decisions have made rulemaking very slow [e.g. State Farm (adequately explain & consider alternatives); Abbott Labs (allow pre-enforcement review & require record for ct. review); Nova Scotia Foods (disclose reference materials)

Politically transparent: Agencies may not want to be held politically accountable for their policy decisions

No retroactivity: Agencies can’t issue retroactive leg. rules but can announce/apply such rules in adjudication (Georgetown, 1988)

d. Ways to promote efficiency during adjudication through rulemakingi. Agency can create uniform guidelines

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1. SCOTUS okayed SSA substituted mandatory use of the grid for expert testimony in a high proportion of cases [Heckler v. Campbell]

2. **modest beneficial effects since most cases involve a complicated analysis of degree/severity

ii. Agency can reduce transaction costs1. SCOTUS okayed HHS Sec's decision to require disability claimants to make a threshold

showing that their medically determinable impairments are severe enough to satisfy the reg scheme [Bowen v. Yuckert]

a. 5-step decision making process. It instructs ALJ to stop after step 2 and to give a negative answer unless ALJ determines that the individual has a severe impairment

b. SCOTUS says okay because of leg history + language of the actc. Increases efficiency and reliability of system, removing people from the process

earlier if they are unlikely to be found disablediii. Avoid adjudication through rulemaking

1. SCOTUS okayed FAA to have the discretionary power to establish a rigid policy, whereby no exemptions are granted until it is satisfied that medical standards can demonstrate an absence of risk factors in an individual sufficient to warrant a more liberal exemption policy from the Age 60 Rule [Yetman v. Garvey]

a. Congress later repealed Age 60 law and changed it to Age 65e. Making Rules Through Adjudication

i. An agency is free to act solely though use of case-by-case adjudication1. An agency that has the power to issue rules through rulemaking process has the

discretion to use the traditional common law method of rulemaking instead, ie to announce broad rules of conduct in the course of a particular adjudication and apply the rules as binding precedent in subsequent cases [SEC v. Chenery Corp]

a. SEC published an order through adjudication allowing for a certain restructuring procedure for organizations that are converting stock

b. Holding 2: An agency can take an action on remand identical to the action reversed by the court if the agency can provide a different and legally permissible basis for the action.

2. Post Cases are Confusing [Chenery is the Law]: a. NLRB v. Wyman-Gordon Co

i. Involved a rule announced by an NLRB order in a prior case (aka adjudication) requiring an underwear company to furnish a list of its employees names and addresses to two labor unions

1. Wyman challenged the validity of the rule on the ground that the NLRB had not satisfied the procedural requirements for rulemaking under the APA

2. Plurality of 4 justices said that the Excelsior proceedings were not adjudication but flawed rulemaking since the NLRB declined to apply the rule to the party before it

3. Upheld the NLRBs order against Wyman-Gordon however on the ground that the NLRB issued that order in the course of Wyman's adjudicatory hearing

b. Morton v. Ruiz i. Issue was whether the Snyder Act operated to deny general assistance

benefits to Native Americans living off but near to reservations1. Court rejected a rule created through adjudication saying that

the determination of eligibility cannot be made on an ad hoc basis by the dispenser of the funds

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2. Suggests that reviewing courts can deny agencies a choice between rulemaking and adjudication

c. NLRB v. Bell Aerospace Co i. SC reaffirmed Chenery II and rejected any notion of repudiating its

holdingii. NLRB utilized an adjudicatory hearing to announce a broader rule of

general applicability, including that even workers properly classified as managerial employees are nevertheless covered by the NLRA

f. Applying Rules Retroactivelyi. Remember, adjudication has a retroactive effect [See Scalia concurrence in Bowen]…can

rulemaking? NO1. HHS Secretary issued a cost limit schedule that included technical changes in the

methods for calculating cost limits, applied them retroactively to hospitals and attempted to recoup sums previously paid [Bowen v. Georgetwon University Hospital]

2. Court says rules cannot have retroactive effect, but agency can announce a rule during adjudication with retroactive effect

a. Ask yourself: does rule attach present consequences to prior action??g. Formal Rulemaking

i. APA §§ 556-557: Akin to judicial trial w/ pleading stage (proposed rule, written responses), trial stage (testimony, documentary evidence, cross-examination), decision stage (formulating final rule)

1. Applies: Only if agency’s statute requires rules to be made “on the record after opportunity for agency hearing (§553)

2. Determination: Examine statute’s context, leg. history, or specific language3. Requirements: Full oral evidentiary hearing (e.g. oral presentation, subpoenas, evidence

rulings, depositions, cross-exam) (§§ 556-557)4. Supporters: Fairness, genuine opportunity to question, thorough record, meaningful

judicial review.5. Critics: Time-consuming, costly, ineffective (e.g. 12 yrs to decide what % of peanut

butter ought to be peanuts)6. Presumption: If statute requires action “after hearing,” only informal rulemaking is

required (FL East Coast, 1973) (ICC freight cars)7. Ambiguity: It is reasonable for agency to interpret “hearing” to refer to written

exchange of views/data (Chem. Waste v. EPA, DC 1989)***note that because of these procedures, most agencies required to do formal rulemaking abandon it altogether

ii. Florida East Coast 1. Case changes everything, since “hearing” just means informal rulemaking (see below)

h. Informal Rulemakingi. APA § 553: General notice of proposed rule, opportunity to participate through written

submissions by interest parties, agency considers & then makes concise gen. statement of basis & purpose, publishes rule

1. Applies: So long as agency’s statute doesn’t require rules to be made “on the record after opportunity for agency hearing (§553)

2. Determination: Examine statute’s context, leg. history, or specific language3. Requirements: Notice, right to submit written comments for review, concise gen.

statement of rules’s basis & purpose, published rule (see below)4. Supporters: Responsive to interested parties, effective, efficient, flexible5. Critics: Lack of transparency, increasingly time consuming & costly6. Presumption: If statute requires action “after hearing,” only informal rulemaking is

required (FL East Coast, 1973) (ICC freight cars)7. Ambiguity: It is reasonable for agency to interpret “hearing” to refer to written

exchange of views/data (Chem. Waste v. EPA, DC 1989)

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ii. Until 1967, courts rarely reviewed agency rules that were issued through use of informal rulemaking until….

1. Abbot Labs v. Gardner a. New test determined if a rule was ripe:

i. Issues raised by the petititon for review are susceptible to judicial resolution prior to the application of the rule in an enfrocement proceeding

ii. Petitioner would be subject to hardship as a result of a deferral of review

b. Led to a high proportion of agency rules ripe for review, also encouraged people to file petitions for any rule they didn't like

i. Standard response from the agency is if you have a comment process, then the notice would change based on that input ; if this wasn’t the system, then it would be so cyclic that it wouldn’t be effective

ii. Challenge must assert:1. Issue of central importance – must be of something (word)

actually disputed2. Had challenger been given notice, they would have refuted it

(with what?)c. Only used the record of the rulemaking proceeding to decide the case, which

was usually pretty flimsy--> a lot of rules got overturnedi. Judicial demands that agencies create more extensive records in

rulemaking proceedings began immediately i. INFORMAL RULEMAKING REQUIREMENTS

i. Oral evidentiary hearings 1. Many rules were being vacated when an oral evidentiary hearing was not held2. SC ended that practice with this case:

a. Vermont Yankee Nuclear Power Corp v. NRDCi. NRDC wanted to change the rule requiring specified numerical values

for the environmental impact of a fuel cycle to be used in operating license determinations without cross examine during hearings

ii. Court said that APA established the max procedural requirements imposed by Congress, Court cannot impose any more

iii. Court held in later case that the courts must be very deferential in these cases (Baltimore Gas v. NRDC)

ii. Lengthy NPRMs 1. Notice shall include

a. Statement of time, place, and nature of public rulemakingb. Reference to the legal authority under which the rule is proposedc. Either the terms or substance of the proposed rule or a description of the

subjects and issues involved2. Most challenges to NPRM adequacy fall into two categories

a. Final rule diverged sufficiently from the proposed ruleb. Agency based a rule on data that was not know or made available to the

interested parties until the agency published the final rule3. Either way deprived them of opp to submit meaningful comments4. Relevant Cases:

a. Notice must “adequately foreshadow” final rule, and final rule must be “logical outgrowth” of notice and comment process. [Shell v. EPA.]

i. NPRM did not include the two rules that were eventually published, although EPA argued that the comments received anticipated both new rules

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b. Notice must refer to studies and other data sources on which agency will rely. [Portland Cement.]

i. Issued an NPRM, got over 200 comments, and then issued a rule without releasing the test methodology used to form the basis for the emission control level adopted

c. But see American Radio Relay League Inc v. FCC i. Concurrence: APA does not require the agency to disclose other

information as part of the notice or rulemaking processii. Portland Cement stands on shaky legal foundation-can't be squared

with language of APA or Vermont Yankee or APAiii. Long detailed statements of basis and purpose

1. Agencies are required to explain the full factual and legal bases justifying their actions and choices in the rulemaking process

a. Must respond to all relevant comments2. Relevant Case Law

a. United States v. Nova Scotia Food Products Corp i. Agencies certainly have a good deal of discretion in expressing the basis

of a rule, but the agencies do not have quite the prerogative of obscurantism reserved to legislatures

ii. Need to show what major issues of policy were ventilated by the informal proceedings and why the agency reacted to them as it did

1. One may recognize that even commercial infeasibility cannot stand in the way of an overwhelming public interest

j. Ex Parte Communications in Rulemakings i. APA 557 d 1 prohibits ex parte comm in FORMAL adjudications and rulemakings, but what about

INFORMAL?1. Relevant Case Law

a. Home Box Office v. FCC i. A number of participants before the Commission sought out individual

commissioners or employees for the purpose of discussing ex pare and in confidence the merits of the rules under review here

ii. DC Circ invalidates rule because of ex parte communications not disclosed in the record which formed the basis for the rule

b. Action for Children's Television v. FCC i. ACT claims that the Commission's manner in creating rules was an

abuse of admin process by failure to solicit public comment on the industry proposals for self-regulation negotiated behind the closed doors of the Chairman’s office, where the industry was clearly coerced into action by threat of FCC regulation

ii. HBO does ensure a whole record for review, but doesn't require the Commission to sum/make available for public comment every status inquiry ever received

1. HBO applies only to rulemakings in which 2 or more individuals are competing for the same valuable right, like Sangamon Valley where they gave every Commissioner a turkey

c. Sierra Club v. Costle i. Efforts by the President and members of Congress to influence agency

decisions in rulemakings through closed door meetings with agency decision makers

1. Court rejects that Presidential jawboning is illegal

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a. “Nothing in the statute and nothing in the constitution that would limit / require an agency to refrain from engaging in an ex parte communication”

ii. In 1979, EPA is deciding whether to set max emission of SO2 from coal-fired generating plants at .55lbs/MMBtu or 1.2 lbs/MMBtu

1. Trying to be less foreign dependent, economic stagflation iii. As long as the agency can explain its rulemaking decision based on the

public record, ex parte communications are acceptable 1. However if an agency changes a final rule based on something

that interested parties would not anticipate from the public record, and if ex parte communications caused that change, that would be objectionable

k. Bias and Prejudgment i. Both the APA and due process require a neutral decision-maker

ii. Ass'n of National Advertisers v. FTC 1. Association said that the chairman of FTC was biased and had prejudged the issue

because he had been on tv saying that children’s ads were bad 2. Court holds: An agency member may be disqualified from a proceeding only where

there is a clear and convincing showing that he was an unalterably closed mind on matters critical to the disposition of the rulemaking

a. Precedent: In Cinderella, we held that the standard for disqualifying an administrator in an adjudicatory proceeding because of a prejudgment is whether a disinterested observer may conclude that the decision-maker has in some measure adjudged the facts as well as the law of a particular case

b. Dissent: Unalterably closed mind test is practically impossible to prove and imposes too high a barrier to the public's obtaining fair decision-makers

3. Notes: Agency heads are usually appointed because of their previously expressed policy commitments

a. ***No court has held that a decision-maker in a rulemaking is disqualified l. Exemptions from Notice and Comment

i. APA 553 contains six exemptions from the informal rulemaking process1. A party who dislikes a rule that an agency claims to be exempt typically argues that the

agency's rule is invalid for its failure to satisfy notice and comment requirements and that the rule does not fall within the scope of the exemption the agency claims applies

ii. Types of exemptions 1. Subject Matter Exemptions

a. Involving military or foreign affairs function of the United States or a matter relating to agency management or personnel or to public property, loans, grants, benefits, or contracts

b. Military exemption not particularly controversial, interpreted very broadly2. Agency management exemption (very controversial)

a. Sometimes still subject to mandatory use of informal rulemaking procedure because Congress enacted the statute that authorized the agency to issue such rules, or the agency itself issued a rule binding itself to use informal rulemaking when it issues these types of rules

3. Good Cause Exemptions a. 553 b B exempts rules when the agency finds that notice and public procedure

thereon are impracticable, unnecessary, or contrary to the public interest b. Courts are stingy with their interpretation of the good cause exemption, unless

they believe that additional procedures would not have altered the outcomei. Bodies piling up, emergencies, etc

4. Procedural Rule Exemption

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a. There are frequent disputes in which an agency claims that a rule is exempt as a rule of procedure and a party who dislikes the rule argues that is actually a rule of substantive rule that is invalid because the agency did not pursue notice and comment

b. Erie like issues determining procedure v. substantive rules5. Interpretative Rule Exemption

a. APA 553 b 3 A exempts interpretive rules from informal rulemaking procedural requirements

b. Interpretive rules have no binding effect, they merely interpret statutes or leg rules that are binding

c. Agency usually uses informal rulemaking process to make its most important rules, and then issues large numbers of exempt interpretation rules to clarify and particularize the requirements set forth in its leg rules

i. Leg rule: expands or creates scope of legal duty 1. Affecting individual rights and obligations

ii. Interpretative rule: can only clarify or particularize the scope of a duty previously created

iii. SC wary of letting agency do everything through interpretative rules anti-parotting cannon

d. American Mining Congress v. Mine Safety and Health Admin i. Whether Program Policy Letters of the Mine Safety and Health Admin,

stating the agency's position that certain x-ray reading qualify as diagnoses of lung disease within the meaning of agency reporting regulations are interpretive rules under the APA

1. Court says yes, a rule does not become an amendment merely because it supplies crisper and more detailed lines than the authority being interpreted

ii. ***Legal Effect Test (DC Circ, majority test): A rule is legislative is 1. Agency says is leg2. Rule is published in CFR (but Court later said this is only a

snippet of evidence)3. An enforcement action could not be brought without the rule

a. Very important, in this case only enforcement would be against a mine owner who doesn’t report something

4. The rule amends a pre-existing legislative rule a. In a later case, DC Cir says interpretative rule cannot

amend a pre-existing one, but that is clearly wrongiii. Substantial Impact Test (Fifth Circ):

1. Whether the rule at issue is binding in that it imposes rights and obligations on regulated parties

2. Whether the rule leaves the agency and its decision-makers free to exercise discretion or, conversely, binds the agency as well as regulated parties

6. Policy Statement Exemption a. APA 553 b 3 A also exempts general statements of policy b. Policy statements are not legally binding on members of the public or on the

courts, not subject to judicial reviewc. Courts tend to be less deferential toward agency legal interpretation advanced

in policy statementsd. Pacific Gas and Electric Co v. Federal Power Commission

i. Federal Power Commission issued a statement of policy on priorities of deliveries by jurisdictional pipelines during periods of curtailment

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ii. Court holds: General statements of policy are merely an announcement to the public of the policy which the agency hopes to implement in future rulemakings or adjudications

1. Serves several beneficial functions a. Encourages public dissemination of the agency's policies

prior to their actual application in particular situationsb. Agency's initial views are not secret but disclosed well in

advancec. Facilitates long range planningd. Promotes uniformity in areas of national concern

2. Binding Effects or Legally Binding Test:a. Matter of general policy but if the agency attempts to

give it legally binding effect or use it for any other purposes – then it would not be (we will tell them they can’t do this, which they later did)

i. Look to the language: must or suggest?ii. Entitled to less judicial deference

e. Community Nutrition Institute v. Youngi. Challenge by a consortium of organizations and private citizens to the

FDA's regulation of certain unavoidable contaminants in food, most particularly, aflatoxins in corn

1. The language employed by the FDA suggests that those levels both have a present effect and are binding

ii. Community Nutrition Test:1. Legally Agency cannot bind itself in a policy statement2. A policy statement can only announce general policies that do

not actually bind the agency to act in accordance with the policy statement

3. Agency must remain free to act in a manner inconsistent with policy statement in a given case

f. Appalachian Power i. Practically Binding Test:

1. Even if it is not legally binding, document may still be a procedurally invalid leg rule so long as the reviewing court determines that the document is practically binding

ii. Thought: Even if general statements of policy lack formal binding effect on regulated party, they may still have coercive effects on regulated party behaviorlikely to assume that this will be the rule and start voluntarily changing their behavior

iii. ***difficult to apply, mix track recordVII. JUDICIAL REVIEW OF RULES

a. Arbitrary and Capricious ("Hard Look") Review I. APA 706 2 a instructs reviewing courts to set aside agency action found to be arbitrary and

capricious II. Courts began to vacate agency rules if they concluded that the statement of basis and purpose

that the agency incorporated in the final rule did not demonstrate that the agency had taken a hard look at the issues and that the agency had not explained to the court's satisfaction why it resolved each contested issue as it did

B. Evolution of the Hard Look Doctrine i. Pacific States Box and Basket

1. A rule is arbitrary and capricious only if the party challenging it can demonstrate that there is no set of facts and no plausible reason that might support it

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ii. Automotive Parts and Accessories Association v. Boyd 1. Rule required all new passenger cars made in US to be factory-equipped with front seat

head restraints2. Court upheld the rule on the basis that NHTSA's relatively brief statement of the rule's

basis and purpose was adequate, given the weak evidence and arguments the petitioner had submitted in its comments in opposition

3. Court cautioned against an overly literal reading of the statutory terms concise and general, realities of judicial scrutiny

iii. National Tire Dealers and Retreaders Ass'n Inc v. Brinegar 1. Petitioner is challenging a standard that requires all passenger tires retreaded to have

certain information permanently molded into the sidewall of a tire2. Rule was a&c where party challenging it submitted high quality studies by credible

consultants that rule was unnecessary and impracticable and agency did not respond adequately to the studies

iv. Motor Vehicle Manufacturers Assn of US Inc v. STATE FARM Mutual Auto Insurance Co 1. ***known as the SC's endorsement of the hard look doctrine2. Congress enacted the National Traffic and Motor Vehicle Safety Act of 1966 : directed

the Sec of Transportation to issue motor vehicle safety standards that are practicable, shall meet the needs of motor vehicle safety, and shall be stated in objective terms

a. Agency went back and forth and then finally rescinded the passive restraint requirement in 1982, saying that it was no longer able to find that the automatic restraint requirement would produce significant safety benefits

i. Mostly because it could be detached and therefore not used nor produce any safety benefits

3. First holding: When it comes to procedures and standards on review, rescissionamendmentissuance of rule so SOR is A and C

4. Second holding: NHTSA was a&c for failing to consider air bag only alternative5. Third holding: NHTSA was a&c for failing to explain adequately the difference between

its prediction that most drivers who didn’t buckle seat belts would disconnect automatic seat belts and study that found that only 50% of drivers disconnected seat belts with ignition interlocks.

1. Dissent: Appears that the agency's changed view of the standard seems to be related to the election of new President of a different political party aka perfectly reasonable basis for reappraisal of the cost and benefits of its programs and regulations

6. Consequences: participants sent the message that they should propose alternatives with support so Agency has to address them all! Now concise general statement of basis and purpose are 200-2000 pages long and are reversed as a & c in 30% of cases

c. Judicial Review of CHANGED Policies i. FCC v. Fox Television Stations, Inc

1. Fed Law prohibits the broadcasting of any indecent language; this case concerns the adequacy of the FCC's explanation of its decision that this sometimes forbids the broadcasting of indecent expletives even when the offensive words are not repeated

2. Test:a. That the agency's new policy be permissible under the statuteb. That the agency have good reasons for the new policy

i. FCC acknowledged its recent actions have broken new groundii. Reasons for expanding scope of enforcement activity were entirely

rationaliii. Technological advance support enforcement policy

c. That the agency believe that the new policy is better, which the conscious change of course adequately indicates

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d. Ossification of Rulemakingi. Hard look review led to agency reluctance to use informal rulemaking, too many procedures

to follow1. Note: this is precisely the effect that the Court identified as one of its reasons for

forbidding courts from engaging in the practice the Court outlawed in Vermont Yankee2. Congress has not acted on this issue

ii. Negotiated Rulemaking1. 1990 Congress enacted the Negotiated Rulemaking Act, aka reg neg

a. Agency assembles reps of various interested parties for the purpose of negotiating the proposed rule

i. Agency then publishes the negotiated proposed rule in an NOPR and invites comments

ii. Never exclusive method of creating rules, controversial iii. Use is declining, cost savings not realized by agencies

iii. Direct Final Rulemaking1. Admin Conference of US also supported another variation of notice and comment

rulemaking known as direct final rulemaking as a means of reducing ossification and speeding up agency rulemaking

a. Issuing regulations in fed registers with a notice that they will become final if no comments received within a certain period

iv. Remand without Vacatur 1. Less drastic measure than reversing or setting aside an agency decision

a. Remand the reg for further agency action while allowing the rule to remain in effect-remand with vacator or without vacation

b. Reversal may interrupt agency efforts or regulated parties that have already arranged their affairs

2. **Note this lowers agency incentive to change the ruleVIII. STATUTORY INTERPRETATION IN ADMIN LAW

a. Kind of Statutesi. Statutes of general applicability

1. Statutes the agency is not charged with implementing 2. Reviewing courts do not confer any special deference on agency interpretations of

statutes of general applicabilityii. Statutes Agencies Administer

1. Congress has delegated some amount of admin authority to one or more particular admin agencies

2. Question is whether the task of statutory interpretation differs when an agency adopts an interpretation of a statue it is responsible for administering

b. Courts have APA instruction to decide all relevant questions of law i. Seems to suggest that the courts should ignore agency interpretations of the statutes they

administerii. Yet statutes are often susceptible of more than one reasonable interpretation, and choosing

between the alternatives may be as much a matter of policy choice as of discerning statutory meaning

c. Court’s review of Statutory Interpretationi. CHEVRON DOMINATES

ii. Pre-Chevron Approach 1. NLRB v. Hearst Publications

a. Case arises from the refusal of newspaper publishers to bargain collectively with a union representing newsboys who distribute their papers on the streets of LA

b. Principal question is whether the newsboys are employees because Congress did not explicitly define the term

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c. Holdingi. Where the question is one of a specific application of a broad statutory

term in a proceeding which the agency administering the statute must determine it initially, the reviewing court's function is limited

ii. The Board's determination that specific persons are employees under this Act is to be accepted if it has warrant in the record and a reasonable basis in law

d. Dissent: this is an issue of law that should be resolved through application of case law

e. ***SCOTUS vacillated between dissent and majority for decades 2. Skidmore v. Swift and Co

a. Employees were firefighters, who received salaries for their working time at the fire hall but also stayed the evenings to be on call

b. Court upholds Office of Administrator’s interpretation of waiting time as working time

c. Skidmore TEST:i. Weight of such a judgment in a particular case will depend upon the

thoroughness evident in its consideration, the validity of its reasoning, its consistency with earlier and later pronouncements, and all the those factors that give it power to persuade, if lacking power to control

d. **Note: Different than NLRB, since the Wage and Hour Division in this case did not possess authority to adminster the Fair Labor Standards Act

3. Industrial Union Dept AFL-CIO v. American Petroleum Institute (the Benzene Case)a. The litigation concerns a standard promulgated by the Sec of Labor to regulate

occupational exposure to benzene, a substance which had been shown to cause cancer at high exposure levels

b. Secs explanation includes voluminous record of the dangers of exposure to benzene levels at 10 ppm+ but does not provide direct support for the Agency's conclusion that the limit should be reduced from 10 ppm to 1 ppm

c. Holding: The statute requires that the Sec find that the toxic substance in question poses a significant health risk in the work place and that a new, lower standard is therefore reasonably necessary or appropriate to provide safe or healthful employment and places of employment

d. IF BENZENE HAD BEEN DECIDED UNDER CHEVRON: i. Court would say Congress has not decided the particular question and

the decision was not reasonableii. Rehnquist’s approach (Statute unconstitutionality delegates

fundamental policy decisions to politically unaccountable bureaucrats) was inconsistent with Chevron

iii. Plurality is also inconsistent (political unaccountable justices attribute to Congress something that it did not say & favor that view over agency

iv. Uphold agency decision (deference)e. What Should the Court do When Faced with Scientific Decisions?

i. What should judges do when they don’t understand?ii. Immerse herself in substance until she understands the issues?

iii. Require the agency to “ventilate” the issues through the use of procedures like oral hearings until the judge is sure that the agency understands the issue and can make supportable findings of fact

iv. Defer to the agency in light of its superior expertise and inherent uncertainty in answering the relevant questions [4 dissenting justices in

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Benzene] but Congress wanted courts to do more than to rubber stamp agency decisions

iii. CHEVRON REVOLUTION BABY1. Chevron USA Inc v. Natural Resources Defense Council Inc

a. Issue: Whether the EPA's decision to allow States to treat all of the pollution emitting devices within the same industrial grouping as though they were enacted within a single bubble based on a reasonable construction of the stat term stationary source

b. Facts:i. CAA requires an elaborate permitting process before anyone can

construct or modify a new “source” of air pollution ii. Until EPA issue the rule at issue, it had defined source to refer to each

piece of combustion equipment and CAA set it so that you had to get a permit every time you had to change a source

iii. Since the definition was so cumbersome, wanted to introduce bubble concept, where everything together would be considered one source

iv. Opponents said this wasn’t the reason for slow economic growth and would not have a net beneficial effects on air quality

v. In the opinion of the EPA in both the Carter and Reagan administrations: definition was harming both the economic and air quality by making it difficult to replace old high pollution equipment with new lower polluting equipment

c. Procedural History:i. DC Cir: said EPA gave thought to the source definition and when it was

challenged, the court upheld it, so the EPA can’t come back and redefine source without convincing the Court there has been a big change

d. Holdingi. Congress didn’t say anything about this aspect of the meaning of

“source,” so an agreement between everybodyii. Politically unaccountable judges should not be making policy decisions

defer to politically accountable agency decisions iii. Since Congress did speak to the issue, statute is ambiguousiv. Believed that the new interpretation in this case would improve air

qualityv. Court believed that was reasonable and upheld it

2. Debating the Chevron Theorya. Scalia

i. Relying on agency expertise may be a good practical interpretation, but it is not a good theoretical one

ii. Courts have the competence to consider and evaluate policyiii. Congress now knows that the ambiguities it creates whether intentional

or unintentional will be resolved within the bounds of permissible interpretation, not by the courts but by a particular agency, whose policy biases will ordinarily be known

b. Piercei. Congress typically leaves the vast majority of policy issues for resolution

by some other institution of gov't: POLITICAL ACCOUNTABILITY IN CHEVRON

ii. Agencies should be doing interpretations since they are more accountable to the electorate (unless arb and cap)

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iii. When applying Chevron's first step, the court should refrain from teasing meaning from the statute's ambiguous or conflicting language and leg history

iv. Chevron Two-Part Test:1. Did Congress directly speak on the precise question at issue?

a. If yes, then end of matter2. If the statute is silent or ambiguous with respect to the specific issue, the question for

the court is whether the agency's answer is based on a permissible construction of the statute

a. If Congress has explicitly left a gap for agency to fill, then can't be set aside by court unless arb and cap

b. Sometimes implicit instead of explicitc. What makes an agency interpretation reasonable?

i. The interpretation is within the range of definitions the statutory language will support, and the agency has adequately explained the reasons for its choice of interpretations ala State Farm

v. Tools of Step One Analysis a. Plain Meaning Rule

i. Dictionary definitions-clear communicationii. Except some dictionaries are different or have multiple word meanings

b. Leg History i. Voluminous, unreliable, illegitimate

ii. Opposed by Scalia and Thomasc. Leg Purpose

i. Statutes usually have multiple, sometimes contradictory purposesd. Canons of Construction

i. Constitutional avoidance, rule of lenity (criminal law, favor the D)e. Stare Decisis

i. SD directly contradicts the Chevron presumption that Congress delegated primary interpretive authority over certain statutes to agencies rather than the courts

vi. Implications of Chevron: APPLIES TO LEGISLATIVE RULES AND FORMAL ADJUDICATIONS [Mead, 2001]

1. In a future EPA, in an admin with a different philosophy, returned to the earlier definition of source and gave plausible reasons for doing so, a court would have no choice but to uphold

a. If they don’t do something that’s explicitly contradicted by the statute, then most judges who are politically accountable have to agree with it

2. It follows that a judicial opinion in which a court upheld an agency interpretation of a statute constitutes binding precedent only in the rare case in which the court concluded that the interpretation adopted by the agency was the only permissible interpretation. The Court announced that logical rule in Brand X (2005).

vii. CHEVRON TODAY1. 1984-2000 Chevron had an enormous effect on Circuit Courts [but not Supreme Courts]

– Supreme Court has decided like 250 cases while Circuit Court has decided thousands2. Varied in whether they applied two step or footnote 9 3. When Chevron Applies

a. Highly deferential Chevron test applies to legislative rulesi. Chevron applies to notice & comment (informal) rulemaking & formal

adjudication (Mead, 2001)b. Unclear if Chevron deference applies to interpretive rules, policy statements,

informal adjudication

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i. Chevron deference may apply based on “all facts & circumstances”ii. Customs classifications: Do not warrant Chevron deference b/c

thousands are made by low-level personnel w/o underlying reasons or precedent value.

4. Skidmore expertise deference applies when Chevron does not (Mead, 2001) Deference will be afforded depending on consideration of certain factors:

a. Did agency carefully considered interpretation at a high level?b. Is agency’s interpretation persuasivec. Is interpretation expressed in published reg/reasoned adjudicatory opinion, or

in formal letter?d. Does agency have expertise in this area?e. Is interpretation consistent w/ past interpretations? (Chevron deference does

not require consistency) 5. Dependents on affiliation:

a. Liberal justices will say Chevron applies while conservatives will say that it doesn’t

i. Justice Stevens spoke about the opinion in Chevron [he was author] he himself didn’t know the implications of his opinion, probably didn’t read it if it was written by a clerk

ii. Outspoken critic of Justice Breyer: Connection to Marbury v. Madison [concept of judicial review]

iii. Breyer and Scalia: Breyer is the most deferential Justice on the court [even though he was an outspoken critic of Chevron]; however, Scalia votes to overturn agency interpretation of statutes most frequently [even though he was an outspoken proponent of Chevron]

iv. Judges generally form their own opinion about what’s right and wrong, so very hard for them to defer to the agencies

6. Article on Empirical Studies: What Do the Studies of Judicial Review of Agency Actions Mean?

1. Six Doctrines 1. Chevron (2 step test)2. Skidmore (weight of judgment depends on thoroughness of consideration of

agency)3. State Farm (arb and capricious SOR)4. Consolidated Edison Co v. NLRB

1. Substantial evidence doctrine-what supports decision in record what detracts from it

2. Virtually identical to State Farm doctrine3. Tech applied only to agency findings in formal adjudications--

>informal adjudications and informal rulemaking5. Auer

1. Applies to agency interpretations of rules rather than agency interpretations of statutes

2. Admin interpretation is of controlling weight unless plainly erroneous or inconsistent with the regulation

6. De novo review2. Studies find 70% affirmance rate for agency decisions-more deferential than not

1. Little variation in the outcome of cases based on doctrine2. In deciding whether an agency action is reasonable a court always asks the same 3

questions 1. Is the agency action consistent with relevant statutes?2. Is agency action consistent with the available evidence?

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3. Has the agency explained adequately how it reasoned from the relevant statutory language and the available evidence to the conclusions it reached

3. What Factors Can Explain the Patterns of Decisions?1. Procedures used to produce the agency decision

1. Little if any effect on rate of judicial affirmance of agency actions, ie notice comment rule-making v. adjudication

2. Agency consistency over time1. Higher affirmance for long standing agency positions v. newly adopted

agency positions2. Small difference though

3. Extent of judicial comfort with SM1. Court has long emphasized comparative institutional advantage and

specialized agency expertise as bases for its deference doctrine2. DC Circ affirms agencies that appear before it 12% less, prob because they

have better understanding of SM4. Ideological perspectives of the judges and Justices

1. Most important factor2. Liberals uphold agency decisions more than conservatives

5. Panel effect1. Whether a circuit court panel consists of three judges of same political party

or of a mixture of judges of different political parties2. Most likely to uphold an agency action when the action is consistent with

the ideological preference of the members of the panel than when the action was inconsistent with those preferences

3. Why4. Don't want to be whistle blower, or don't want someone to write a

scorching dissent against them, and collegiality 4. Is the DC Circ Different?

1. Decides 25%+ of agency action review but overturns more of them2. Greater familiarity with SM, especially with agencies they review a lot3. Process of appointing judges different than in other circs, President can make

nominations of his own choosing many go onto the SC4. Less crowded docket, more time to decide and explore cases

5. ADVICE TO PRACTIONERS: 1. Spend less time on doctrine, more time on consequences of action + if for P, bring in

DC Circ2. Post Chevron and Its Scope

1. Between 1984 and 2000, Court never said anything about the scope of Chevron2. Applied it to interpretations adopted legislative rules and in formal adjudications BUT lower

courts differed re: whether it applied to interpretative rules, policy statements, informal adjudications, advisory letters, amicus briefs, etc

1. Could lead to the slippery slope of Chevron applying to anything and everything associated with the agency interpretation

3. The Court has addressed the scope several times since 2000 – but the only thing that comes out clear is that the Court differs

4. Rapanos v. US 1. Facts: Clean Water Act confers on the EPA jurisdiction over the “waters of the United

States” (not navigable waters, just any water)1. Depending on that, it can or can’t be regulated by the federal government – EPA

interpreted it broadly for a long time2. Used reasoning that even if there was no water in a place for 11 months, and

could be for 1 month as an important place for migratory birds – then you

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would have to regulate it to protect it over the year so that the waster CAN gather for one year

2. Holding: the only natural definition of the term waters, our prior and subsequent judicial constructions of it, clear evidence from other provisions of the statue and the Court's canons of construction confirm that the term cannot bear expansive meaning

3. ***Circuit Courts have interpreted this decision in three completely different ways, law depends on what circuit you’re in

4. Overall Theory:1. Four justices who are generally considered liberal go with Chevron2. Four justices who are generally more skeptical say no and go with canons of

construction3. Until now, EPA has been going on a case by case adopting a broader and

broader definition what they should do is conduct notice and comment rulemaking

5. Christensen v. Harris County: Chevron does NOT apply to interpretative rules or policy statements – Skidmore still applies

1. Court upholds county policy re: mandatory use of compensatory time under FLSA1. FLSA is not agency administered its judicially administered2. In some circumstances, there were conditions for the comp time as a potential

substitute for wages 2. Refuses to defer to contrary DOL interpretation announced in opinion letter 3. Chevron applies to interpretations announced in formal adjudications and legislative

rules, but not in interpretative rules or policy statements [so it doesn’t apply here]1. Skidmore applies : statute is silent on this issue and because Harris County's

policy is entirely compatible with the statute, petitioners cannot prove that Harris County violated the statute

4. Pierce Opinion: It takes so long for an agency to issue a leg rule or to conclude a formal adjudication that adoption of the Christensen test would create a situation in which each President has no choice but to implement many of the policies of his predecessor even when he disagrees strongly with those policies

6. United States v. Mead Corp: Chevron does not apply to Customs Services Classification 1. Question: whether a tariff classification ruling by the US Customs Service deserves

judicial deference2. Mead Test:

1. Whether Congress gave the agency power to issue leg rules even if the agency did not adopt the interpretation at issue in a leg rule

2. Extent of the public participation in the decision making process3. Degree of formality of decision making process

1. In this case, the process is so far removed from notice and commenting process, and any other circumstance reasonably suggesting that Congress even thought of classification rulings as deserving the deference claimed for them here

4. Precedential effect of interpretation5. Whether it binds 3d parties6. Whether agency provided explanation7. Status of the individual who adopted the interpretation

3. Skidmore applies-vacate and remand for determination of persuasiveness 4. Scalia criticizes the majority test as “utterly flabby” and “virtually open ended” [Pierce

agrees with this] he would apply Chevron to any agency interpretation that represents the authoritative view of the agency

7. National Cable & Telecomm Assn v. Brand X Internet Services

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1. Whether the FCC conclusion that cable companies that sell broadband Internet service do not provide telecomm service and hence are exempt from mandatory common carrier regulation is a lawful construction of the Communications Act

2. Holding: A prior judicial decision interpreting a statute is binding precedent only if court concluded that the interpretation adopted was the only permissible interpretation of the statute

3. 4 justice plurality holding in Home Concrete 2012 1. Not unambiguous is not the same as ambiguous, so Brand X does not apply2. Um what? How is the court going to apply this in future?

2. What is the difference between Chevron and Skidmore?1. Unless it’s a rule where the majority has said whether Chevron has applied or not 2. If you’re arguing for the agency, you always argue for Chevron deference first and THEN use weaker

Skidmore test to show deference still applies 3. Chevron first asks whether Congress addressed the issue at hand 4. Skidmore says these agency decisions don’t have the power to bind, but they had the power to

persuade look at thoroughness of the reading (isn’t that just Chevron, State Farm)5. Skidmore’s last factor – the consistency of the agency’s interpretation matters // Chevron said

consistency doesn’t matter ; Skidmore takes into account a broader sweep of considerations 1. In theory is deferential because courts must eval the agency's interpretation by reference to the

various factors and may not reject the agency's interpretation solely because it differs from their own preference

6. Would the Court have decided Chevron the same way if they had applied the Skidmore test?1. Asked first if Congress had resolved the issue – all sides agreed it did not 2. If it was ambiguous, questioned whether the agency had a permissible reasoning for

interpretation 3. If it were to apply Skidmore, would say they were not bound [Chevron said courts don’t have

any discretion, but if they adopt agency standards then its binding] agency explanation is persuasive

1. Look at the thoroughness of the reasoning 2. Because the agency changed its interpretation, the Court might have rejected it because

it wasn’t consistent 3. Maybe it would have been 5-4 or come out the other way

4. Chevron involved a change from prior longstanding interpretation5. Does a subsequent President get to return to the prior interpretation of the rule?

3. Agency Interpretation of Agency Regulations1. Auer/Seminole Rock: Extremely Deferential Test

1. An agency’s interpretation of its legislative rule must be upheld unless “plainly erroneous or inconsistent with the regulation”

2. Agency cannot apply interpretation of an ambiguous rule in a penalty case unless it has provided “fair warning” of its interpretation

1. Due process concerns3. Importance that the regulatee have notice of the interpretation – regulatee wins in the penalty

context only 4. ***Hinted in 2012 Case Christopher that Justices may be open to overturning Auer since it just

leads to agencies creating ambiguous rules2. Gonzalez v. Oregon Can’t afford deference if rule merely parrots the statute

1. Pierce says this makes sense but there has never been a “no parroting rule”2. AG cannot interpret statute or rule to bar statute from allowing doctors to prescribe drugs to

assist a patient in committing suicide3. Auer deference is not due to an interpretation of a rule that merely “parrots” a statute

1. If you parrot the language of the statute then you lose access to the court deference

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2. Agency has tried to circumvent notice and comment procedure by issuing parrot and then relying on interpretations that don’t require notice + comment

3. It’s all a matter of degree – how far beyond the language of the statute has the agency gone in particularizing

4. NO CHEVRON:1. CSA does not grant the AG to broad authority to promulgate rules, only for those

relating to registration and control and for the efficient execution of his functions under the statute and this interpretive rule does not fall under this function

5. SKIDMORE: applies because they are basically just interpreting the statute BUT deference again inappropriate because AG lacks expertise and didn't consult with anyone outside the DOJ

IX. JUDICIAL REVIEWa. Three categories of limitations on judicial review of agency action

i. Reviewability generally: which agency actions are subject to judicial reviewii. Four overlapping doctrines that limit time at which agency action is subject to judicial review:

finality, ripeness, exhaustion, and primary jurisdictioniii. Standing: who can obtain judicial review of an action

X. JUDICIAL REVIEWABILITYa. Until 1960's an agency action was not reviewable unless a statute authorized judicial review or a statute

commanded or prohibited an agency action in such a clear and unambiguous manner that a court was willing to characterize the action as ministerial and non discretionary

b. Then SC began to greatly expand reviewability i. Abbott Lab v. Gardner

c. APA embodies the basic presumption of judicial review, which Congress can and does limiti. 701 a 1- statute precludes review

ii. 701 a 2- action committed to agency discretion at lawd. 701 a 1: Many regulatory statutes contain judicial review provisions with language that clearly or

arguably limits reviewability i. How broadly or narrowly should these be read?

e. Express Preclusioni. If the statute clearly and unequivocally precludes all judicial review of an agency action,

then the courts will generally give the statute effectii. Tend to be particularly narrow of claims to obtain judicial review violations to the

Constitutional rights of petitionersiii. Johnson v. Robison

1. Facts: a conscientious objector draftee served alternative service at a hospital was denied veteran's educational benefits because he didn't serve on active duty

2. Court applies avoidance canon as basis for decision allowing constitutional challenge to statute even though statute precluded review

3. Statute was indistinguishable between the people who provide alternative service versus those in the military – have constitutional right to the same benefits (SC said reviewable)

4. Statute would have to say “no judicial review of constitutional validity of this statute”

iv. Califano v. Saners1. SC explicitly stated that constitutional questions obviously are unsuited to

resolution in admin hearing procedures and therefore access to the courts is essential to the decision of such questions

2. Court also said that it might read a statute as precluding judicial review of constitutional claims if Congress' intent to foreclose review is manifested by clear and convincing evidence

f. Implied Preclusioni. Block v. Community Nutrition Institute

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1. Whether ultimate consumers of dairy products may obtain judicial review of milk market orders issued by the Sec of Agriculture

2. In this case, Congress did not intend to strip the judiciary of all authority to review Sec's milk market orders but only gave this reviewability for handlers, after they had exhausted all of their other remedies

a. Because they were so explicit about this, it is clear that their omission of reviewability for consumers is sufficient reason to believe that Congress intended to foreclose consumer participation in the regulatory process

ii. Presumption favoring judicial review is a presumption which can be overcome, not only by explicit language but what is implied by Congress:

1. Presumption is very variable depending on how court applies it2. Structure of the statute as a whole 3. Specific language or specific legislative history that is reliable indicator of

congressional intent 4. Can be inferred from contemporaneous judicial construction barring review5. Collective import of leg / judicial history 6. Doesn’t have to be “clear and convincing,” can be “fairly discernible”7. **WEAKER than Robison

iii. Bowen v. Michigan Academy of Family Physicians1. Whether Congress barred judicial review of regulations promulgated under Part B

of Medicare program2. Contrary intent must be expressed, mere failure to provide specially by statute for

judicial review is certainly no evidence of intent to withhold review3. Only upon a showing of clear and convincing evidence of a contrary legislative

intent should the courts restrict access to judicial review: Abbott Labs4. The mere fact that some acts are made reviewable should not suffice to support an

implication of exclusion as to others 5. Statute that precludes review of benefit decisions unless agency has finally

denied benefits does not preclude review of eligibility rules6. Note: Court in Bowen refused to draw a similar inference from statutory silence

concerning the reviewability of doc challenge to Medicare Part B as they did in Block

g. 701 a 2: Committed to Agency Discretioni. The limitation on reviewability imposed by APA 701 a 2 when agency action is committed to

agency discretion by law is cryptic and ambiguous ii. Citizens to Preserve Overton Park, Inc v. Volpe

1. Overton Park in Memphis was approved by Sec to get a highway through it cutting off the Zoo, provided no statement of factual findings that explained what was required by the Acts

a. We agree that formal findings were not required, but we do not believe that in this case judicial review based solely on litigation affidavits was adequate

2. The Sec's decision here does not fall within the exception for action committed to agency discretion

a. Very narrow exception, applicable in rare instances where statutes are drawn in such broad terms that in a given case there is no law to apply

b. In this case the Act gives clear and specific directives with plain and explicit language

c. The very existence of the statute indicates that protection of parkland was to be given paramount importance

3. A and C SORh. Overlap between 701 a 1 and 2:

i. Reviewability of FHA Decisions Allowing Rent Increases for Federally-Subsidized Housing

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1. Public housing program involved in both cases here—tries to encourage private developers to build housing that’s designed to house poor people and does that by providing subsidies to make those buildings available to poor people

a. Accept rate regulation as the quid pro quob. Congress recognized in that program that over time the cost of making housing

available could go up, so the property has to be available at a regulated rate but you can apply for an obtain an increase in that regulated rate

2. HUD will review rent increase request, HUD will make a decision a. Both cases involve situations in which tenants objected to rent increases

ii. Hahn v. Gottlieb1. First Circuit was asked to review a decision by HUD to allow an owner of a Title 8

property to increase the rent it charged tenantsa. Housing statute was silent with respect to reviewability of HUD decisions to

allow increases in rent charged 2. Held that these decisions were unreviewable because they were committed to agency

discretion by law a. Courts lack expertise needed to evaluate HUD decisionsb. Courts may unintentionally cause more harm than goodc. Availability of judicial review of rent increases may harm poor people by

deterring prospective investors from investing in title 8 propertiesiii. Langevin v. Chenango Court

1. Second Circuit court criticized First for Hahn case2. Noted that court has long reviewed agency decisions analogous to HUD decision; statute

just happened to be silent about this reviewability3. Criticized the conclusion that rent increase decisions were committed to HUD's

discretion4. Thus, rejected the argument that APA 701 a 2 operated to deny reviewability in such

casesa. Yet the 2nd Circuit continued by agreeing with the policy concerns expressed

and by holding that HUD decisions authorizing rent increases are not reviewable because Congress implicitly precluded review of such decisions within the meaning of APA 701 a

i. REVIEWABILITY TODAYi. Overton Park one of the last to reflect the old attitude, then increased the role of courts in

prescribing decision-making procedures agencies were required to usii. Then began to issue opinions in 1976 in which it reduced the role of the courts in that process

1. Reduced power and scope of the presumption of reviewability2. Still exists, but weaker and narrower than in Overton Par

iii. Heckler v. Chaney case (comes later)1. Clearly separates exception provided by 701 a 1 from 701 a 2

iv. Webster v. Doe1. National Security Act provides that the Director of CI may, in his discretion, terminate

the employment of any officer or employee of the Agency whenever he shall deem such termination necessary or advisable in the interest of the US

2. CIA Director terminates homosexual without providing reasons, hearing, etc.a. Holding 1: Statutory review is not available because decision is committed to

agency discretion by law:i. “in his discretion . . . whenever he shall deem . . . advisable . . .” –

“no law to apply;” 1. high deference, appears to foreclose the application of any

meaningful judicial standard of reviewii. Structure of statute;

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iii. Context.b. Holding 2: Avoidance canon allows constitutional review.

i. Court split 7-2 relies on Robison— avoidance canon, even though Congress told courts to stay out it hasn’t told them to stay out even in the context of constitutional validity in the ambiguity

3. Scalia dissent: I do not see how a decision can, either practically or legally, be both unreviewable and yet reviewable for constitutional defect

a. APA 701 a 2 refers to common law of judicial review of agency action that certain issues and areas are beyond the range of judicial review

i. Political question reviewii. Sovereign immunity

iii. Official immunityiv. Prudential limitationsv. Equitable powers

vi. Traditional respect for the functions of other branchesb. Also includes a determination whether the decision involved a sensitive and

inherently discretionary judgment call, and whether review would have disruptive practical consequences

c. Congress has the power to tell the Court to stay completely out of a class of disputes including a class of constitutional disputes

v. Lincoln v. Vigil1. Congress had long appropriated funds for health and education of Native Americans and

the agency had used a big chunk of that money to run a particular program which it then abandoned

2. Beneficiaries of that program joined by members of Congress go to court—can’t do this, once you have started using a chunk of appropriations for that program you cannot abandon it without giving an explanation

3. Supreme Court disagrees—unless it’s in the language of the statute they have discretion over this

4. Agency decision to defund a program is committed to its discretion unless Congress has limited that discretion by statute (if it doesn’t say agency must spend it on X, it has discretion to spend it on what it will)

5. If a member of congress the only way to insulate yourself from this is through inclusion of earmark in the legislation

j. Judicial Review of Agency Inactioni. Until 1975 SC routinely held that agency decisions not to investigate and agency decisions not to

bring an enforcement action when the agency has reason to believe that someone has committed a violation of law within its jurisdiction are committed to the agency’s unreviewable discretion

1. ***Comes from British doctrine prohibition of review of prosecutorial decisionsii. Confiscation Cases (1868)—court cannot compel US Attorney to prosecute clear violation of

law even though statute is mandatory1. Statute at issue was clear—it instructed the representatives of the federal government

to confiscate assets in certain circumstances (government shall…)a. Has something that fits within the scope and the government declines to

prosecute itb. Someone goes to court to demand they prosecutec. Court reads statue as if it gives the government the discretion to confiscate or

not to confiscate

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iii. Enforcement Discretion: Agencies have discretion over whether to investigate or take enforcement action given limited resources & funding & the need to prioritize decisions & respond to competing pressures & such decision are generally unreviewable.

1. Relevant Case Law:a. Dunlop v. Bachowski

i. Situation: prod agencies to take actions that they are reluctant to take, does the presumption of reviewability apply to agency inaction as well as agency action? Have to overcome ancient principle of prosecutorial discretion in criminal cases

ii. FACTS: LMRDA requires DOL to set aside election if it finds probable cause that winner engaged in illegal tactic that affected the outcome (uses the word “shall”)

1. Bachowski claims to have been victim of illegal tactics and asks DOL to act, DOL refuses

iii. 3d Cir. Reverses and requires DOL to provide both a hearing and reasons for not acting: Presumption of reviewability trumps common law

1. Statute protects private rights rather than public rights2. Statute couples “shall” with justiciable standard ; probable

cause is a justiciable standard iv. Holding: DOL Sec.’s decision subject to judicial review, albeit narrow

A&C (Sec. required to provide rational reasons, but not hearing) 1. Congress wanted to create decision-making process that would

not cast long-term cloud over union leadership. v. ***In the LMRDA, a court must ask instead whether an agency has so

much evidence of wrongdoing that it was required to make a probable cause determination

b. Shelley v. Borcki. DC circ held that the agency was require to initiate an enforcement

action in response to the complaint since the agency expressed its belief that the conduct at issue was unlawful

ii. Many circ courts interpret Bachowski broadly and ordered agencies to take actions they did not want to take, until this case:

c. Heckler v. Chaney: Courts cannot compel enforcement actioni. Facts: Opponents of death penalty petition FDA to prohibit use of

prescription drugs for lethal injection on basis that they are not “safe and effective” for that use. FDA denies petition.

ii. DC Cir. applies presumption of reviewability (Overton Park, Abbott Labs, Dunlop) & FDA policy statement re off-label use to compel FDA to act.

iii. Holding: S. Ct. reverses. Under 701(a)(2), agency inaction is presumed to be unreviewable on the basis that it has been “committed to agency discretion.”

1. Recognition of reality that there’s no agency that has resources sufficient to allow it to act in every single case (further, factors that induce agency to act in one case but not another very complicated)

a. Involves a complicated balancing of a number of factors within its expertise: whether violation occurred, where

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resources best spent on this violation or another, whether likely to success, whether it fits within agency’s overall policies, and whether the agency has enough resources to undertake the action at all

2. BUT presumption can be rebutted if statute indicated an intent to circumscribe agency enforcement discretion, and has provided meaningful standards for defining the limits of that discretion.

3. Here, there is “law to apply” under 702(a)(2) and courts may require that the agency follow that law; if it has not, then agency refusal to institute proceedings is a decision “committed to agency discretion by law” within the meaning of that section

iv. NEED language of command (“shall”) coupled w/ justiciable standard (treat Dunlop as meeting rebuttal reqs., thus reviewable – Prof. disagrees)

1. Presumption can be rebutted only by statute or leg. rule2. Policy statements cannot rebut

a. Not binding;b. Now many agencies won’t issue leg. rule w/ law to

apply b/c want to avoid review v. Interpretive rule can’t compel reviewability, but agency could have an

ambiguous leg. rule that was interpreted to impose on it a duty to act in circumstances specified by leg. rule

iv. Discretion to Regulate: Cts. aren’t second-guessing agency’s allocation of scare resources but reviewing outcome of agency’s voluntary decision after it has already chosen to devote resources to rulemaking

1. § 553(e): “each agency shall give an interested person the right to petition for the issuance, amendment, or repeal of a rule,” and when such petitions are denied give “a brief statement of the grounds for denial.”

2. Ct. can review decisions not to issue rule after rulemakinga. NRDC v. SECU (DC 1971)

i. Facts: Environmentalists & civil rights groups want SEC to require all corps. to include in their reporting very detailed reports on their environmental & employment practices. SEC conducts a rulemaking but only issues a decision requiring compliance statement

ii. Holding: Decision not to issue a rule AFTER conducting rulemaking is reviewable-already spent resources

3. Refusal to amend rule subject to deferential reviewa. American Horse Protection Assn. v. Lyng (DC 1987

i. Facts: Congress passed statute banning “soring” and tells DOA to implement ban. DOA defines soring to exclude use of light weights but promises to expand ban if Auburn study finds that light weights cause soring. Auburn study so finds. DOA to expand definition of soring. DOA refused and AHPA sues.

ii. Holding: Agency decisions to refuse to issue or amend a rule in response to a petition are subject to deferential A&C review. Such a refusal will only be overturned in “the rarest and most compelling circumstances”

v. Why is this different than failure to enforce?1. Rulemaking inaction is different from enforcement action b/c:

a. Less frequent than decisions not to act in adjudications (thus won’t overburden ct.)

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b. Often focus on law (here, definitional Q), rather than complicated set of factors that agencies consider when deciding where to allocate their resources (thus ct. has some understanding of issue)

c. APA § 553: Whenever agency denies petition for rulemaking, requires agency to give reasons for denial provides basis for review.

d. Decision not to initiate a rulemaking is rarely overturnedvi. Mass v. EPA (1 of only 3 cases in which petitioner got review & WON)

1. Global warming case where the holding of Lyng soring case was applied and approved2. SC applies AHPA test in context of petition to EPA to initiate rulemaking to determine

whether and to what extent to limit auto emissions of CO2 to mitigate global warming3. It is now easy to get review of denial of petition for rulemaking but very difficult to get

court to vacate decisionvii. Current Legislation in the House : Reigns Act: No agency rule can go into effect unless and

until it is enacted as a statute by Congress (eliminates the role of agencies, turn agencies into the staff of Congress); add 63 new procedures to the Notice and comment rulemaking procedures; redefine rules so it applies to interpretative rules and policy statements agenda of Congress

a. Probably will be enacted by the House but no chance it’ll pass the Senate or President

XI. TIMING OF JUDICIAL REVIEWa. In order to be reviewable, agency action must be

i. FINALii. RIPE

iii. EXHAUSTED ALL OTHER ADMINISTRATIVE REMEDIES AVAILABLEb. FINAL AGENCY ACTION

i. Agency must have concluded its decision making processii. Decision must have formal legal consequences

iii. APA §704 makes final agency action subject to judicial review iv. Franklin v. Massachusetts (Reapportionment case)

1. Facts: Appellees (Mass.) lost a seat in the House of Reps after appellants (Pres., Census bureau officials, Sec of Commerce, and Clerk of House of Reps) allocated overseas military personnel to the State designated in their personal files as “home of record”

a. Altered the state populations so significantly that Mass lost a Representative seat to Washington.

2. Holding: The final action complained of here is an action of the President, and because he is not an agency within the meaning of the Act there is no final agency action that may be reviewed.

a. Agency action is not final if it is only “the ruling of a subordinate official or tentative” like not the Secretary’s report to the President aka NO LEGALLY BINDING EFFECT

3. Congress overruled first holding in Franklin by statute DOC’s Census Making decisions are subject to judicial review, Congress can say that an agency action is final or even if its not, its reviewable

v. Dalton v. Specter 1. Facts: President made decision to close a naval shipyard in Philly pursuant to the

Defense Base Closure and Realignment Act of 1990. 2. The president’s decision comes at the end of an elaborate process prescribed by the Act.

a. **Note different from Franklin here-Pres can only say yes or no not ad hoc like above

3. Two days before President submitted his certification of approval to Congress, respondents filed suit.

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4. Holding: Actions of the Secretary and Commission cannot be reviewed under the APA because they aren’t “final agency actions” and carry no consequences

a. The final action was by the President, and his actions cannot be reviewed under the APA because he isn’t an “agency”

b. President is not subject to non-statutory review because he did not violate any statutory command or prohibition

5. Concurrence: Congress designed it this way so it wouldn’t be reviewablevi. Bennett v. Spear : Court used a new two part test for determining whether an agency action is

“final agency action” under APA §7041. Facts: ESA (Endangered Species Act) requires that federal agencies insure that any

action they take isn’t likely to threaten the existence of any endangered species, Fish and Wildlife Service will then provide the agency with a written statement explaining how species affected

a. **Note Final with the fact that the Fish and Wildlife agency is through with decision making sense, but it has no formal legal effect unless BLM acts on it and changes the release schedule of dam in conformance with opinion

2. Holding: The Service’s opinion here constitutes a “final agency action” because it has direct and legal consequences; change in legal status counts but powerful indirect effects do not (think second hand smoke)

a. Two Part Test:i. Action must mark the consummation of the agency’s decision making

process (it can’t be tentative or interlocutory) ii. Action must be one by which “rights or obligations are determined” or

from which “legal consequences will flow” 3. ***This is how it differs from Franklin and Dalton:

a. In Franklin, Secretary’s report on census was more like a tentative recommendation

b. In Dalton, the closure recommendations to the President were not binding on him because he had discretion to reject or accept them

vii. Which Decisions Under FIFRA are “Final” – Agency Two Step Process of Cancellations & Suspensions

1. Might be situations where an agency (EPA) makes an error and it won’t make sense to wait years to complete the cancellation hearings

2. Cancellation requires a finding that costs exceed benefits after elaborate procedures that take years v. suspension requires finding of imminent harm after few, if any, procedures and can be done quickly

a. Decision to initiate cancellation proceeding? Yes – not final / No – reviewable & final / In action – not final

b. Decision to suspend pending outcome of cancellation proceeding? Yes [completed process w/concrete effect] / No – [could be characterized as intermediate step] / Inaction – unreviewable

c. Decision to Cancel? – Yes – final / No – final / In action – not reviewable 3. Circuits are divided on everything

a. Finality doctrine could apply to almost anything c. Ripeness for Judicial Review

i. Grounded in common law, not APAii. Assures issues are sufficiently developed for judicial review

iii. Abbott Laboratories v. Gardner1. Before Abbott, most agency rules could only be reviewed in the context of an action to

enforce the rule, very few rules were challenged – the only record was the record in the enforcement action and the agency almost won

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2. Facts: In 1962 Congress amended the Federal Food, Drug and Cosmetic Act, to require manufacturers of prescription drugs to print the “established name” of the drug prominently, Rx sued before rule was final

3. Three Part Test:a. Did Congress intent to preclude pre-enforcement review when it provided an

alternative route to review? (presumption of reviewability applies)i. Congressional intent must be shown by clear and convincing evidence

b. Are issues appropriate for judicial resolution at this time and in this abstract context?

i. If purely legal, more ripe for reviewii. If factual, wait to see how law is applied

iii. Mostly, they’ll always be ripe for review c. Would petitioner suffer hardship if review is deferred?

i. In this case, absolutely yes because drug companies would either have to comply with a potentially invalid rule or violation of the rule and enforcement action which will cost a lot of money and PR

ii. ***NOTE: DC Cir. doesn’t apply this part of Abbotts lab test, based on a belief that that a court should resolve any issue that is appropriate for pre-enforcement review in a pre-enforcement review proceeding no matter what might be the adverse effects of deferral of review.

4. ***NOTE: Plaintiff can typically persuade court to engage in pre-enforcement review of a rule to determine whether the agency provided an adequate notice of proposed rulemaking or whether the agency’s statement of basis and purpose contains a thorough explanation of the agency’s reasoning process to overcome a claim that the issuance of the rule is arbitrary and capricious.

iv. Post Abbott Labs: most major rules are now challenged as arbitrary and capricious, and a high proportion are challenged on the basis that the agency didn’t provide adequate notice.

1. Abbott labs remains the law but with some major qualifications:a. Reno v. Catholic Social Services, Abbott does not apply to benefit eligibility rulesb. Thunder Basin Coal Co. v. Reich, Congress implicitly precluded pre-enforcement

review of a regulatory rule by providing an alternative route to reviewc. Shalala v. Illinois Council on Long Term Care, Justices disagree re-existence of

presumption of reviewability, strength of presumption, and whether there is a presumption of pre-enforcement review

2. Some statutes require pre-enforcement review3. Courts demanded a “record” in the form of the notice, comments, and statement of

basis and purposeProvides incentives for lawyers to submit voluminous documents v. Toilet Goods Ass’n v. Gardner

1. “Free access rule” If the FDA determines that you violated the right of free access to your facility, they may revoke certificate – is that ripe for review?

a. 1st part = Same statute as Abbott, so it does not preclude pre-enforcement review

b. For second part, can characterize as an issue of law – can the FDA insert a right of free access? 4th amendment constitutional issues – what does the agency mean about the right of free access? Yet still in this case, extremely fact based so it’s not appropriate for judicial review under the abstract concept

c. No change in day-to-day businessi. Only thing that could happen is revocation of certification yet that

would mean the company is out of business [court blows this off but it’s really important]

ii. No adverse consequences that would result from requiring a later challenge to the regulation.

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vi. Temporal Limits1. Sometimes society would be better off if we got a quick answer, so Congress can limit

time to file for pre-enforcement review2. Adamo Wrecking – Congress can limit to 30 days within which anyone can seek review

of an emissions standard, but petitioner can obtain review of whether rule qualifies as an emissions standard

a. Rule was issued as an emissions standard for Clean Air Act for companies that demolish buildings

b. Adamo Wrecking claims it didn’t know about the emissions standard and sues for the preclusion within only a 30 day window

c. Adamo argues that it isn’t an emissions limit (instead of the window) – they’re allowed to make that challenge 30 day limit only applies to issues that would be ripe for resolution by a court

3. Limits uncertainty and the agency would know quickly 4. If the issue was not ripe when the rule was issued, review is available within 30 days of

ripening of issue [have to file the petition within 30 days]d. Duty to Exhaust Administrative Remedies

i. Reasons for Exhaustion (Judge Made) 1. Avoid premature interruption of agency decision-making process2. Allow agency to develop and resolve factual issues3. Allow agency to exercise discretion4. Allow agency to apply expertise5. Enhance efficiency6. Avoid burdening agencies and courts7. Respect agency autonomy8. Deter parties from sandbagging

ii. APA 704(c) says final action is reviewable unless statute or rule requires resort to intra agency review process

1. Cannot be compelled to exhaust this particular remedy as a prerequisite to judicial review

2. Have to restructure rule to say “shall” exhaust everything instead of saying “may exhaust” – statute has to have mandatory requirement

iii. McKart v. United States1. Can a sole surviving son raise the invalidity of his 1-A classification as a defense when he

didn’t appeal his reclassification, which constituted a failure to exhaust available administrative remedies.?

2. Holding: Application of the exhaustion doctrine in this circumstance wouldn’t be appropriate.

a. Administrative remedies are no longer available;b. Hardship in criminal context;c. Issue did not involve fact-finding, discretion, or expertised. Others are not likely to be as foolish as McKart.

iv. But see McGee v. United State1. Facts: Petitioner was a conscientious objector and had applied to the agency board for

“conscientious objector status,” was rejected, didn’t seek appeal but then didn’t appear for physical

2. Holding: Petitioner’s failure to exhaust administrative remedies bars his defense of erroneous classification because in this case his claims turned on resolution of factual questions which required the expertise and discretion of agency’s appeal board

v. McCarthy v. Madigan1. Facts: McCarthy was a prisoner who filed complaint against 4 prison employees alleging

that they had violated his rights under 8th amendment by their deliberate indifference to

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his needs and medical condition resulting from a back operation/history of psych problems.

2. Issue: Is a federal prisoner required to resort to internal grievance procedures set forth by the Fed Bureau of Prisons before he may initiate a suit (pursuant to Bivens) solely for money damages.

3. Holding: Congress has not required exhaustion of a federal prisoner’s Bivens claim¸ and given the type of claim McCarthy raises and the particular characteristics of the grievance procedure, his individual interests outweigh the countervailing institutional interests.

a. Prisoner seeking money damages has everything to lose and nothing to gain from being required to exhaust claim under internal grievance procedure.

4. NOTE: Congress overruled McCarthy by statute in 1997, as Court recognized in Booth v. Churner in 2001. There are no judge-made exceptions to a statutory duty to exhaust.

a. What if the prisoner requests one remedy beyond the scope of power for the Bureau of Corrections = monetary damages

b. Congress said their intent was to get them out of the courts anyway, still must exhaust all remedies

c. Even though exhaustion doctrine began as prudential judge made doctrine, it can be trumped at any time by statut

vi. Woodford v. Ngo (2006): Petitioner can’t wait until time period runs out to file for review1. Statute requires exhaustion of “available” remedies does not permit petitioner to wait

until after time to use remedy expires and then seek review.a. Court cannot excuse a failure to exhaust when Congress has required

exhaustion by statute b. Has statute that says in a certain class of cases, you must exhaust all available

administrative remedies, which are only available for a discrete time period 2. Petitioner waits until the day after the remedy time period is extinguished 3. Pierce agrees with majority who cited his treatise

e. Issue Exhaustion: requires petitioner to raise an objection to an agency action at each stage in the agency decision making process as a pre-req to the petitioner’s ability to convince a court to consider the objection.

i. Darby v. Cisneros (don’t overestimate its significance, applies to only intra-agency review)1. HUD said anyone anytime is accused of violating the rules, they would refer the case to

an ALJ- who will determine the appropriate penaltiesa. This is a final decision,b. However, anyone that disagrees can appeal to the Secretary of housing and

development2. HUD hearing examiner debarred Darby.

a. Darby then tried to go directly to courtb. HUD argues that he did not exhaust his available remedies (because he didn’t

appeal to the Sec)3. Court says that although this appeal was available, the agency didn’t say that it was

required as a prerequisite for reviewa. Citing: APA §704(c) says final action is reviewable unless statute or rule requires

resort to intra-agency review process. b. Precludes agency from saying a procedure is optional, then when you don’t

pursue optional procedure, claiming that you have not exhausted your remedies

f. Agency Delayi. APA § 706(1) authorizes a court to compel agency action unreasonably delayed, but it is almost

impossible to win an unreasonable delay case in the absence of a statutory deadline. 1. Mandatory statutory deadline cases are easy in theory, but impossible in practice.

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a. Easy in theory: Congress can set deadlines on agency action b. Hard in practice: Congress does not know problems/priorities of agency

i. FOIA requires action w/in 20 days, but FBI is 20 yrs behind c. Enormous problem with no real solution –not judicially solvabled. Norton v. Southern Utah Wilderness Alliance (2004)

i. Agency was supposed to evaluate ALL the property owned by the federal government, figure out how it is now classified, and reclassify them, someone filed a 706 (1) claim

ii. Only discrete and mandatory acts can be subject to 706(1) or subject to review

iii. Only can compel the agency to act for the action that was unreasonably delayed / can’t tell agency they have to implement a program

ii. § 706: Potential remedies1. Ct. can order agency to act if action “unreasonably delayed”

a. But so many reasons for delay possible: resources, proceduresb. P must prove it’s “unreasonable” for agency to have allocated resources in such

manner that has caused delay in other priorities violates Chaney b/c cts. incompetent in telling agencies how to prioritize

2. TRAC case—setting forth 6 part test to determine whether agency action has been unreasonably delayed

a. the time agencies take to make decisions must be governed by a “rule of reason”

b. where Congress has provided a timetable or other indication of the speed w/which it expects agency to proceed, the statutory scheme may supply context for this rule of reason

c. delays that might be reasonable in the sphere of economic regulation are less tolerable when human health and welfare are at stake

d. the court should consider the effect of expediting delayed action on agency activities of a higher or competing priority

e. the court should also take into account the nature and extent of the interest prejudiced by delay; and

f. the court need not find any impropriety lurking behind agency lassitude in order to hold the agency action is unreasonable delayed

g. Primary Jurisdiction i. When should a court dismiss a case or defer decision in a case to allow an agency to address an

issue that is within its expertise? Consider relative expertise, clarity of issue, need for national uniformity and effects of delay

ii. Even if court appropriately evokes the issue and then an agency issues a rulemaking process on the issue – they might take years to decide

iii. Because of concerns of delay, practice of routinely requesting amicus briefs has displaced referring issues to agency

iv. If a court encounters such a case it cannot resolve definitively and the agency is in a better position to apply their expertise – then court’s job is to identify the issue, defer resolution and send it to the agency

XII. Standinga. 77% of studies show that 77% of decisions on standing can be explained on political groundsb. Question asked: If an action is reviewable, is it reviewable by this party?

i. Complicated combination of constitutional reasoning, statutory reasoning, prudential reasoning and unstated decisional factors unrelated to the question of who has standing

c. Requirement:

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i. Action must be reviewable under the timing doctrines, P must have a specific legal interest that isn’t too speculative, attenuated or abstract

ii. Constitutional: Injury in Fact, Causation, Redressability 1. SC has interpreted “Case” and “controversy” requirement of Article III as limiting

standing to those P’s who satisfy 3 elementsa. P must establish that she has suffered an “injury in fact”

i. Concrete and particularized injuries count, but abstract and generalized injuries do not.

b. P must demonstrate a causal connection between her injury and the conduct that gives rise to her complaint (aka injury must be fairly traceable to the challenged action of the D)

i. Speculative or indirect causal relationships do not count.c. P must show that a decision by the courts in her favor will likely redress her

injury iii. Prudential / Statutory: Zone of Interest test

d. Constitutional Requirements of Standingi. Association of Data Processing Service Organizations Inc. v. Camp : Generalized Threat of

Competition1. ADP seeks review of Comptroller of Currency decision to allow banks to provide data

processing services to their customers2. Holding: Competitive injury was injury in fact

a. Competition from national banks they might entail future loss in profits. 3. Two Part Test:

a. Part I = Constitutional : injury in fact b. Next question is statutory – did Congress intend to allow data processing

companies to challenge decisions of this type i. Have to prove that the agency had invaded your statutory rights

ii. If the statute said “anyone who’s adversely affected” – well if you qualify under the injury in fact test, then you would qualify under statutory test

iii. Relevant provision of APA = have standing if “adversely affected or aggrieved” within meaning of statute

1. Court believes this brings competitor with the zone of interest protected by it.

ii. Allen v. Wright 1. Facts: Parents of black public school kids allege that the IRS has not adopted sufficient

standards and procedures to fulfill its obligation to deny tax exempt status to racially discriminatory private schools. They claim that this harms them directly and interferes with the children’s ability of their children to receive an education in desegregated public schools.

2. Holding: They do not have standing because the injury in fact is not fairly traceable to the Government conduct challenged as unlawful.

a. The line of causation between that conduct and desegregation of public schools is attenuated at best.

b. Diminished ability of the children’s to receive a desegregated education would be traceable to unlawful IRS grants of tax exemptions only if there were significant amount of private schools receiving tax exempt status to make difference in public school integration

3. Dissent: The injury in fact is traceable to the government conduct! Question of economics

iii. FEC v. Atkins

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1. Facts: FEC determined that the AIPAC is not a “political committee” and therefore FEC has refused to require AIPAC to make disclosures regarding its membership, contributions, expenditures, etc that FECA would otherwise require.

2. Holding: Yes, a group of voters (w/views often opposed to those of AIPAC) seek to pursuant the FEC to treat AIPAC as a “political committee” have standing.

a. Congress has explicitly provided in FECA that “any person who believes a violation of this Act has occurred, may file a complaint with the Commission” …”Any party aggrieved by an order of the Commission dismissing a complaint filed by such party may file a petitioner”…

b. There was an injury in fact suffered bc of the voters inability to obtain information (list of AIPAC donors, campaign related contributions etc).

3. INFORMATIONAL INJURY: injury suffered by every voter is a judicially cognizable injury if Congress has created a right that applies to every voter and an agency has acted in a way that interferes with that right, distinguishing Schlessinger and Richardson (see below)

4. Court recognizes informational injury because of the nature of the statute iv. NO TAX PAYER STANDING

1. United States v. Richardsona. Court held unanimously that neither taxpayers nor voters have standing to

challenge refusal of the government to make public the details of the CIA budget (Arguably in violation of Article 1 Section 9 Clause 7)

2. Schlesingera. Const. says no one can hold simultaneously more than one position in the

branches, injury is too abstract and generalized b. Taxpayers and voters cannot challenge arguable violation of constitutional

prohibition on anyone holding office in two branches in context of large numbers of Senators and Reps who are members of military reserves

v. TAX EXEMPT STATUS OF HOSPITALS: 1. Simon v. Eastern Kentucky Welfare Rights Association

a. Poor petitioners rejected for treatment by tax exempt hospitals cannot challenge adequacy of IRS method of enforcing prohibition on tax exempt status of hospitals that refuse to provide service to poor people because they cannot prove that the particular hospital’s policies were a function of their tax exempt status No Causation

vi. Linda R.S. v. Richard – 1. Mother of children who were entitled to child support could not challenge DA’s

refusal to prosecute father because she could not prove that the father would have paid rather than go to jail for several years

a. State has a law that it’s a crime to refuse to make child support payments b. Injury exists but no causal relationshipc. Four justices read concurring opinions like majority opinion in Heckler v. Chaney

Court cannot order agency’s exercise of enforcement discretion vii. ***Note: All decided before Heckler v. Chaney

1. No cases like this after that case because prosecutorial discretion is unrefutable and we don't know anything about it

2. They can do whatever they want to prosecute e. Environmental Standing

i. ADP (1970) recognizes “injury in fact” economic or otherwise but the Court said it needed to satisfy case in controversy, that the injury could be economic

ii. Sierra Club (1972) – explicitly recognizes environmental and other aesthetic injuries as injuries in fact as long as an individual member suffers an injury of this type – someone who hikes in or near a wilderness area is injured by an agency action that permits the development of the area

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but someone who is merely offended by knowing of such a decision in an area he doesn’t use lacks standing

iii. Can they get to court just by saying they’re an organization dedicated to preserving the environment – this would injure us by harming the environment

1. The court says this is too broad but the injury can be an aesthetic injury – if they were to come back with someone who used the area and would be harmed by the new regulation, then that creates standing

2. Concrete in that the injury must be tied to a particular individual who is a member of the organization

iv. Justice Scalia’s Battle to Cut Back on Environmental Standing1. Scalia says Take Care Clause permits only the President to enforce environmental laws

and precludes a court from interfering with the President’s discretion. v. Common Standing Cases:

1. Membership organization – union, trade association, public interest files petition for review relying on derivative standing; relies on evidence on agency record and affidavits from members to support its claim

2. Association has standing to bring suit on behalf of its members whena. Its members would otherwise have standing to sue in their own rightb. The interests it seeks to protect are germane to the organization’s purpose ANDc. Neither the claim asserted nor relief requested require the participation of

individual members in the lawsuitvi. Lujan v. National Wildlife Federation (1990) – Geographic Vicinity Case

1. Invokes §10(a) of APA which has 2 requirementsa. Person claiming right to sue must identify some FINAL “agency action” that

affects him in the specified way i. Program to be challenged is not final agency action, but rather

continuous operations of re-classifying land across country – can’t seek wholesale improvement of program by court decree

b. Must show that he has suffered “legal wrong” b/c of the challenged agency action, or is “adversely affected or aggrieved” by that action w/in the meaning of the relevant statute

i. To be “adversely affected or aggrieved” must establish that injury complained of falls w/in “zone of interests” sought to be protected by the statutory provision whose violation forms the legal basis for the complaint

ii. In this case:1. Adverse effect/aggrievement meets zone of interests b/c

statutes implicated were designed to protect recreational use and aesthetic enjoyment

2. BUT Claim that one member of respondent’s organization uses unspecified portions of immense amount of land does not show actual effect

c. ****Scalia persuaded majority to make modest incremental change – add in a geographic proximity requirement for environmental standing disputes

vii. Lujan v. Defenders of Wildlife – Geographic Requirement, temporal proximity 1. Most federal environmental statutes have citizen suit privileges [can file a private action

against anyone who violates the rule or provisions of the statute] “shared by all,” like Akins

a. Wanted court to decide the statutory interpretation2. Court finds: Such a citizen suit provision is unconstitutional as applied

a. Statute says any citizen has a right to sue, so even when Congress has conferred standing on a group of people [all citizens] it has overstepped its bounds

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3. Petitioners who planned to visit asian leopard and nile crocodile in indefinite future lacked temporal proximity [as well as geographic requirement]

4. Ecosystem Nexus theory – that anyone who used any part of a “contiguous ecosystem” is adversely affected = inconsistent with National Wildlife Federation (must be geographical proximity); Animal Nexus – anyone with an interest in studying or seeing endangered animals; Vocational Nexus – anyone with a professional interest = ABSURD

a. ***Concurring justices don’t embrace this completely 5. Injury was not redressable both because the agency might not comply and because

Egypt and Sri Lanka might go forward without US fundinga. Pierce thinks these arguments are silly, idea that the agency might not comply is

ludicrous b. Egypt and Sri Lanka is more plausible, rarely would they provide a large portion

of the funding 6. Take Care Clause precludes Congress from authorizing courts to interfere with

Presidential discretion to enforce public laws 7. Petitioner claiming procedural injury need not show that procedure will change

outcome, but must show that he has a substantive interest at stakea. 2 Justices concur without accepting reasoning of pluralitb. 3 Justices would grant standing but deny petition on the merits

8. *First case where Court held petitioner lacked standing even though Congress explicitly granted the petitioner standing

9. *First case where Court applied the redressability requirement in a manner that was independent of the causation requirement

a. *Redressability requirement is satisfied if it is “likely” that a judicial decision would redress the petitioner’s injury

10. *First case where the Court discussed the availability of standing in cases in which a petitioner alleges that it has been injured by an agency’s failure to provide a procedure to

viii. Steel Co. v. Citizens for a Better Environment1. Facts: where court decided whether an association of individuals interested in

environmental protection had standing to bring action against manufacturing company for violation of the Emergency Planning and Community Right to Know Act (EPCRA) and whether the EPCRA authorizes suits for purely past violations (when the company found out they were in violation, they promptly disclosed all the overdue PW).

2. *There is a “citizen-suit provision” which allows anyone to submit an action on his own behalf

3. Holding: Need not deal with whether being deprived of info that should have been disclosed under EPCRA is a concrete injury – b/c case, even assuming injury, fails on redressability since respondent cannot be reimbursed for losses caused by late reporting/or eliminate any effects of the late reporting.

i. A declaratory judgment is useless as the information has already been releaseii. A civil penalty/damages would go to the U.S. Government (who chose not to

bring suit) – not to the organizationiii. That a favorable judgment would make the “injured” party happier is not

enough to satisfy redressabilityiv. Payment of costs would benefit organization BUT can’t achieve standing to

litigate substantive issue by bringing suit for the cost of bring suit ix. Friends of the Earth, Inc. v. Laidlaw Environmental Services

1. Facts: where Clean Water Act authorized citizen-suit provisions for either injunctive relief or civil penalties

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2. SC says can’t conflate initial standing to bring suit with post-commencement mootness – here compliance did not occur until after the suit began, penalties may serve to deter future violations

a. Injury Alleged: Affidavits that company neighbors cannot fish, camp, swim, in river because are concerned about pollution – fear is reasonable

b. Redressability:i. All civil penalties have some deterrent effect – and reason for penalties

is retribution and deterrence in addition to restitutionii. Steel Co only established that citizen suitors lack standing to seek civil

penalties for violations that have abated by the time of the suit – doesn’t apply to allegations ongoing at time of complaint

c. Mootnessi. Would only become moot if subsequent events made it absolutely clear

that allegedly wrongful behavior could not reasonably be expected to recur

ii. Here, voluntary cessation of wrongdoing does not mean that company will not restart that wrongdoing in the future

3. Dissent (Scalia): No demonstrable harm to environment yet finds injury – makes injury in fact requirement a sham, violation of federal standing principles

4. Why this case is importanta. Drastically changes the nature of the injury the petitioner must establish

i. Now, don’t need to prove actual harm to the environment, hire experts, very high cost just establish that he has hanged his conduct based on “reasonable fear” that the illegal emissions rendered his prior conduct dangerous to his health

ii. Drastically changed approach to proof of redressability – interpreting Steel Co very narrowly AND equating redressability with deterrence

x. Massachusetts v. EPA – 1. Environmental organizations, states, and localities petition to review EPA decision

refusing to begin rulemaking to regulate emissions of carbon dioxide from autos.2. Five-Justice majority holds that Massachusetts has standing. Focuses solely on

Massachusetts interest as sovereign in loss of its coastal landa. ****Unprecedented that court gave special, preferred status to a State

3. Case or Controversy Requirementa. Qualifies – dispute about proper construction of congressional statute – doesn’t

seek an advisory opinion, adjudication of political question, wasn’t mooted by subsequent developments

4. Standing – they havea. Normally would need concrete or particularized injury, actual or imminent,

injury that is fairly traceable to D, and redressabilityb. BUT when Congress accords procedural right to protect concrete interests,

don’t need to meet immediacy and redressability standards1. Litigant vested w/ procedural right has standing if there is some

possibility that the requested relief will prompt the injury-causing party to reconsider the decision that allegedly harmed the litigant

c. States are not normal litigants – quasi-sovereign capacity gives them special standing status but if they own some of the land where injury is being caused, strengthens their cause further

5. Final Result: a. Court can review agency decision to deny a petition for rulemaking

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b. EPA refusal to initiate rulemaking to set such emissions limits was arbitrary and capricious

6. Dissent: Dissent says injury is too generalized and is pure conjecture, limits on emission have miniscule impact on global warming (shows shift in composition of court –some Justices move back to Scalia’s side

xi. Summers v. Earth Island Institute (2009)1. Five justice majority holds that environmental organization lack standing even though

their millions of members use all of their national parks and the rules they seek to challenge will be applied to all national parks

2. Dissenting justices argued that high probability of injury should be enough to support standing

f. Prudential Standing and the “Zone of Interests”i. Prudential limitations that go beyond requirements of CON standing

1. Plaintiffs may assert their own injures BUT aside from associational standing principles already discussed, 3rd parties don’t have standing on basis of other’s injuries

2. To based standing on burden of taxation, b/c it is injury shared by all taxpayers, must show more direct and individualized injuries than just status as taxpayers

ii. Legal Rights Test 1. Pre-APA the Court used test to determine whether petitioner had standing to obtain

review of an agency action – depended critically on language of the statute authorizing the agency action

2. If silent on standing, Court applied legal right test = very difficult to satisfy3. Alexander Sprunt & Son – where Court found that although agency action had caused

economic harm to shipping company, they had no standing b/c:a. The statute conferred upon shippers a legal right only to reasonable service at

reasonable rates w/o undue discrimination (they weren’t asserting violation of this)

i. *Note: Old rates may also have been statutorily permissible – in which case the agency action would have been unlawful – but Court refused to examine case

b. Judicial reversal of the agency order would be futile since carriers could keep new rates on voluntary basis anyway

i. *Note: This point is formally accurate but was irrelevant – no company would choose to use the new rates – so could have gotten redressability from court

c. Criticized for circular reasoning aspect – Court considered whether party’s claim had merit in order to decide whether party was entitled to have merit’s considered

iii. BUT, if statute seemed to authorize more liberal test, Court allowed:iv. Adversely Affected Test:v. FCC v. Sanders Bros. Radio Station – where FCC granted license to competing radio station in

same area1. S.Ct. says petitioner has no right to be free from competition, but it has standing

because statute confers standing on anyone who is adversely affected or aggrieved by an FCC order

2. Congress can confer broad standing on “private attorney generals” to help insure that agencies comply with the law

vi. Zone of Interests Test1. Whether the interest sought to be protected is arguably within the zone of interests to

be protected or regulated by statute that is basis for the claim or constitutional guarantee

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2. Broad Conferral of Standing: even broader than the economic harm/adversely affected test b/c also encompasses “aesthetic, conservational, and recreational” concerns

3. Look back on ADP above: based on APA 702 (bank case during enacted during depression that limited banking to banks, who do you think Congress was trying to protect?)

a. ****Circuit Split4. Clarke v. Securities Industry Ass’n – where there was dispute over whether a discount

brokerage office was a branch w/in the meaning of the McFadden Act (and thus whether specific discount brokerage offices could be opened). Trade association representing brokers, underwriters, and I-Bankers brought suit. Comptroller argued that respondents lacked standing b/c they were not win zone of interests protected by the McFadden Act (which serves to establish competitive equality between state and national banks – not protect securities dealers)

5. Holding: Trend towards enlargement of class of people who may protest admin action – excluding only those not arguably w/in the zone of interests to be protected by statute

a. Consider congressional intent BUT Petitioner need not prove specific intent to protect interests at stake

i. Don’t just consider McFadden Act – should be considering context of National Bank Act on the whole

b. Respondent was proper party to bring suit 6. Air Courier Conference of America v. American Postal Workers Union, AFL-CIO –

a. Facts: where Court decided that postal employees were not w/in the zone of interests of the Private Express Statutes – which codify the USPS monopoly on carriage of letters. USPS had suspended PES for purposes of int’l remailing – and postal workers filed suit.

b. Court: Petitioner must prove intent to protect its interestsi. Legislative history doesn’t show goal to benefit workers

c. Notes: Cuts back significantly on Clarke w/o overruling the specific holdingi. This case makes congressional intent central to analysis, declines to look

at entire statute7. Nat’l Credit Union in 1998 – re-expands zone of interest [GOOD LAW]

a. Petitioner need not prove to protect its interestsb. Petitioner is arguably in zone if a victory would further its interests

i. Since statute limits market credit union can serve, and since banks were asserting interest in limiting markets credit unions can serve, the banks had interest protected by the statute

c. Dissent: Party will always have interest w/in zone of interests – b/c no one will bring suit unless has some benefit effect on their interest. Here, statute did not intend to protect banks.

XIII.NON-DELEGATION DOCTRINE: Congress and Agenciesa. Agency Rulemaking

i. Most consists of exercise of legislative power delegated to agencies by Congressii. Congress authorizes/mandates that agencies promulgate rules/regs to accomplish statutory

purposes and impose penalties upon regulated parties who fail to complyiii. Arguably violation of Article I of CON (all legislative powers herein granted shall be vested in

Congress)b. Agency Adjudication

i. Often exercise of judicial powerii. Congress authorizes agencies to adjudicate rights/obligations of regulated parties under

statutory provisionsiii. Arguably violation of Article III of CON (judicial power shall be vested in SC and such inferior

courts . . .) and right to trial by jury

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c. S. Ct. interpreted Art I to prohibit Congress from delegating the power to make policy, but applied it only to invalidate one statute in 1935.

i. Two step view of looking at govt making rules that cannot be delegated to someone else but here, the vast majority of policy decisions are made by agencies

ii. Court originally upheld statute as delegating only the power to determine the factual predicates for application of policies chosen by Congress

iii. As soon as that no longer worked, Court upheld as filling in the details of policies 1. “interstitial policy making” is okay as long as Congress is making the big decisions

iv. As soon as that no longer worked, Court upheld as containing an “intelligible principle” even when statutory standard was “just and reasonable”

d. ***Congress is most politically accountable institutione. Non-delegation Doctrine

i. Named contingency test (Legislation ok b/c President’s authority was limited to taking specific action prescribed by Congress when “named contingency” occurred)

ii. Legislative standards test (Congress could delegate legislative power if it set standards sufficient to limit the scope of the agency’s discretion)

iii. Intelligible principle test (statute delegating power to agency can be upheld if it established an “intelligible principle” to guide the exercise of that power)

f. ***only two cases were delegation held UNCONSTITUIONAL i. Panama Refining Co. v. Ryan – where statute gave President authority to prohibit transport of

petroleum in interstate/foreign commerce in specific circumstances; party argued was UNCON delegation of legislative power

1. Holding: Statute is brief and unambiguous – offers no rules, guidance, limitations, criterion, and declares no policy (all up to the President)

a. CON forbids Congress from abdicating/transferring essential legislative functionsii. A.L.A. Schechter Poultry Corp. v. U.S. – where entire Court found that section of Act

authorizing President to approve “codes of fair competition” was violation of non-delegation doctrine

1. Act does not define fair competition2. Gives unfettered discretion to President to make whatever laws he thinks may be

needed/advisable for rehabilitation and expansion of trade or industry3. Ability to use his discretion across vast array of commercial/industrial activities

throughout the countryiii. S Ct. was routinely striking down New Deal plans

1. Many commentators, including Breyer, now emphasizes the fact that power was delegated to private parties with clear conflicts of interest thus the cases weren’t really about the non-delegation doctrine

g. Decline of the Nondelegation Doctrinei. Amalgamated Meatcutters 1971: Congress can broadly delegate price setting

1. DC Circuit upholds statute that delegates power to set all wages and prices to President Nixon.

a. Didn’t want Nixon to have that kind of power– he then enacts such regulations b. Contract implies a renewed contract but Nixon has a wage freeze – so they

challenge the statute as an unconstitutional delegation of power 2. Which factors should have influenced the court?

a. Pres. can use WWII standards;b. And see below

ii. Broad delegations of power were upheld in many casesiii. Court often relied on imaginative reasoning

1. Statute applied for limited time only (Congress later extended it)2. Individuals could protect themselves from arbitrary action through use of procedural

safeguards (when statute provided virtually no safeguards)

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3. Actions under statute were subject to potential judicial review (Courts affirmed virtually all 1000s of actions taken under statute)

4. Statutory reference to avoidance of gross inequity reflected Congressional decision to adopt a fair and equitable standard

5. Allow statute itself lacked explicit standards, could use the standards to administer something else (that had never been mentioned in relation to this)

6. Congress needs broad leeway for nat’l security/foreign relationsiv. Regulatory statutes often still implicated nondelegation concerns when they granted agencies

broad general authority to promulgate “all necessary rules and regulations” to enforce the statutes

1. Nondelegation did not preclude agencies from adopting legally binding substantive regulations under more specific statutory authority grants BUT

2. A general, all necessary rules and regulations grant that permitted binding regs carrying force of law would violate nondelegation doctrine SO

3. Treated general authority grants as merely recognizing the executive’s already-existing power to execute, interpret and enforce congressionally enacted laws

h. Renewed Interest in Nondelegation Doctrine in the 1970s/1980si. Critics found flaw with Congress’s increasing tendency to delegate most policy decisions to

agencies1. Abdication of responsibility

a. Congressmen spend all their time wooing constituents2. Harmful for democracy

a. Agencies who are not as directly responsible to the people make the hard decisions

ii. Creates an environment in which corruption, cronyism, and patronage can thrive.iii. Rehnquist and 4-Justice plurality in Benzene seem to agree ; see Industrial Union Dept. AFL-CIO

v. American Petroleum Institute (The Benzene Case)iv. Ken Arrow got the Nobel prize for proving that a multi-member body cannot use democratic

principles to make a stable choice among 3 or more alternative policies where no majority supports any alternative.

i. Apparent rejection of the attempt to reinvigorate the non-delegation doctrinei. The court has applied the intelligible principal standard to uphold broad delegations of power in

5 cases by votes of 9-0 or 8-1 (all except Scalia)ii. Mid-American Pipeline: Upholding a statute delegating to the Sec of Transporation the

authority to establish a schedule of fees based on various factors, i.e. to determine both the incidence and level of a tax

iii. Touby v. US: Upholding a grant of power to the Attorney General to designate a substance as a controlled substance, and thereby determine an element of various drug crimes

iv. Loving v US: Upholding a statute allowing the president to determine when a court martial should impose the death penalty

v. Whitman v Am Truck Ass: Upholding a broad grant of power to the EPA to set air quality standards

vi. Mistretta v. US: Upholding a delegation of power to a special commission established to issue sentencing guidelines that binds the courts

1. Can Congress delegate to an “independent agency” the power to issue sentencing guidelines that bind judges? YES

a. Similar to SS disability decision making, Congress thought widely different sentences

2. TEST: It is not a violation (of the doctrine) if Congress clearly delineates:

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a. the general policy, the public agency is to apply it, and the boundaries of this delegated authority

3. Scalia dissenting (unique): not dissenting on basis of non-delegation doctrine, but on the basis that it is an unconstitutional delegation of raw power to an independent agency AKA the commission is basically legislating

j. The New Non Delegation Doctrinei. Chevron as a Response

1. Are agency policy makers politically unaccountable bureaucrats? [arguably a fatal flaw]a. But agencies are representative of the President, who is accountable to the

people 2. As a member of Congress, would you be willing to delegate a broad power to agencies

once you know that the President will be resolving all ambiguitiesa. More incentive to make a higher proportion of policy decisions

3. No Justice has urged reinvigoration since Chevron and Court has unanimously upheld 5 broad delegations of power

a. Including power of an agency to determine whether to impose a tax, on whom and if so, in what amount

b. Including power to define conduct as criminalc. Including power to determine what forms of conduct warrant the death penalty

4. Since 2000, 2 scholars and 2 Justices have questions whether there was ever a basis for the doctrine.

ii. In the series of cases relating to American Trucking, the SC addressed at least one strand of the non delegation theory

1. American Trucking Ass’ns v. EPA Case 2. What should EPA do in the case of non threshold pollutants, ie pollutants that cause

serious adverse health effects at every level down to and below the level produced by nonanthropogenic sources

3. Lower Court order EPA to reevaluate a. Which serves two of three basic rationales for the non-delegation doctrine:

i. If an agency develops binding standards for itself, it is less likely to exercise the authority arbitrarily

ii. As such, meaningful judicial review will be easier4. Whitman v. American Tructing Ass’ns where P is challenging EPA’s revised air quality

standards; SC unanimously reverses lower court holding (above)a. The court evaluated whether language of the statute authorizing regulation of

pollutants convey the necessary specificity for the EPA to extract a standard that do not violate the intelligible principal/non-delegation doctrine

b. Court finds that the statute instructs the EPA to set primary ambient air quality standards that are “requisite to protect the public health” with an “adequate margin of safety”- which is a discernable standard (intelligible principle) because:

i. the Court reads the “requisite” language to mean “sufficient, but not more than necessary”

c. Using that reading, the court finds that the standard set by Congress is comfortably within the scope of discretion of delegation

k. Precise Delegations of Power i. If broad delegations of power are bad, are detailed commands good?

ii. Statutes can be divided by those which are excessively broad and those which are excessively detailed / then there are under inclusive and over inclusive

iii. Congress can employ rational proxies: use rational factors that correlate with their goals even if they are not perfect measures for achieving them

iv. The Food Stamp Program

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1. Congress responds to widespread food stamp abuse by college kids with rich parents by forbidding DOA from providing stamps to any individual who has in his or her household an individual who is claimed as a dependent on last year’s income tax return filed by an individual with high income

2. While broad delegations of power have my undesirable effects, when Congress acts in an over-precise manner it often creates serious problems

a. Beneficiaries constitute a small and politically powerless constituencyb. Political durability of Food Stamps is related to its secondary beneficiaries

v. US Dept. of Agriculture v. Murry1. Where Congress amended the food stamp act to instruct the DOA to deny food stamps

to any household that has a person who is 18 or older who has been claimed as a depended for federal income tax purposes by taxpayers who are themselves ineligible for food stamps

a. DOA must deny food stamps to Murry, a single grandmother with 12 minor dependents and income of $57.50 per month.

2. Court holds provision unconstitutional as a violation of irrebuttable presumption doctrine

a. Where statutory requirements rely upon presumptions that are not always true and also affect important individual rights, due process requires that affected individuals be allowed to rebut the presumption

i. Factual surrogate used as irrebuttable presumption in a statute must be necessarily or universally true to pass muster

b. Some children do not live or benefit from food-stamp-ineligible parent who claimed them

c. What does this do for other statutes? i. You can't vote til 18...is it universally true that this is the age of maturity

for voting?ii. Never again applied this holding

vi. The Delaney Clause: Reworded statute so these do not apply anymore1. The FDCA contained a clause that “no food additive shall be deemed to be safe if it is

found to induce cancer when ingested by man or animal”2. At the time, science did not understand the differences in cancer between people and

animals (or really anything about cancer)a. Only a small fraction of the substances that the clause banned induce cancer in

humans when ingested in quantities relevant to a human dietb. ***Pierce cited the use of the rat/sugar test by the law firm to make the point

that this clause could be abused by third parties3. Les v Reilly where the FDA allowance of four pesticides that were known carcinogens to

be used as food additives was challenged. a. The FDA claimed a “de minimis” exception to the Delaney clause, citing a study

suggesting that the concentration level of the chemicals in processed foods of the noted carcinogens generally poses no actual risk of cancer,

b. The court found that although the FDA has evidence it, is not for the FDA or the Courts to correct Congress.

4. ***Notes: Under Clinton, congress enacted an amendment to the pesticide regulatory statute that has the effect of never requiring the EPA to ban a pesticide based on the Delaney Clause

l. Constitutionality of Delegating Adjudicatory Power i. Article III vest the “judicial power” in “one Supreme Court, and in inferior courts” as congress

may occasionally establish1. However, viewed literally, this is theoretically violated every time an executive branch

official finds facts and applies relevant law

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2. Practical application allows congress to authorize agency adjudication (dating back to 1789)

ii. Agency Adjudication may offer advantages1. Less expensive2. yields superior decisions (in terms of accuracy and consistency)3. relieves article III courts of a massive burden

iii. Because agency power to adjudicate is susceptible to challenge, under article III and the 7th amendments the SC tries to answer two reoccurring questions:

1. In what circumstances does Article III compel adjudication by a life-tenured federal judge?

2. In what circumstances does the 7th amendment require trial by juryiv. Crowell v. Benson, Congress gave some workers (who were not provided with workers-comp

rights via the states) the right to seek no-fault based compensation claims from their employers in a federal agency adjudication

1. The right to bring an action was created by Congress, and is therefore considered a “public right”

a. Public rights disputes can be adjudicated by agencies.b. Private rights disputes can only be adjudicated by courts but plenary judicial

review of agency action is sufficient judicial involvement, analogizing agency to special master

i. I.e. social security cases 2. All agency is doing is conducting the initial trial, but since someone could then go to

court, Congress has not impermissibly transferred their rights. a. ***Is this still good law? Not really, private rights v. public is the only part that

survives v. Northern Pipeline Const. Co. v. Marathon Pipe Line Co: Ct. holds new bankruptcy law

unconstitutional.1. The Court was concerned that the creation of the new bankruptcy courts (and their

greater jurisdiction) violate the independence of the judiciary under article III and found that:

a. The new courts were not independent and therefore not article III material b. The Court also found that the core of many bankruptcy conflicts are private

rights disputes between a creditor and debtori. and ONLY controversies involving public rights can be removed from

article III reviewii. And therefore the act carried the possibility into administrative

encroachment into article III jurisdiction2. The Court distinguishes this case from Crowell:

a. Crowell involved only congressionally created rights (public rights)b. The agency in Crowell made only specialized, narrowly confined factual

determinations regarding a particularized area of law c. The agency in Crowell engaged in statutorily channeled fact-findingd. The agency in Crowell possessed only limited power to issue compensation

orders pursuant to specialized procedures3. ***The outcome of Northern Pipeline encouraged parties to challenge several

adjudicatory regimevi. Union Carbide: agencies can supervise private disputes in narrow class of cases if good reason

1. Where the court upheld a provision 5-Justice majority upholds statute that assigns a class of takings disputes to agency-supervised binding arbitration and authorized applicants for approval of pesticides that were similar to previously approved pesticides to use data submitted by the earlier applicant

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a. Authorization was subject to duty to compensate earlier applicant for use of its property

b. Court found that although the compensation was between private people/ a private right, the heart of the dispute involved the exercise of authority by a federal gov’t agency.

c. Union carbide, in one sense, goes further than any article III case because it left no role for reviewing courts because absent fraud, misconduct, or misrepresentation, the arbiter’s decision was not reviewable

vii. Commodity Futures Trading Commission v. Schor1. 7-Justice majority upholds CFTC assertion of power to adjudicate common law

counterclaims because narrow class of disputes, good pragmatic justification, and defendant implicitly consented.

2. Congress created the CFTC which promulgated a regulation which allows it to adjudicate counterclaims arising out of the same transactions

3. Court evaluated:a. Extent to which the “essential attributes of judicial power are reserved for

article III courts i. Article III does not confer on litigants an absolute right to plenary

consideration of every nature of claim ii. Article III’s guarantee of impartial and independent federal adjudication

is subject to waiver (by bringing to CFTC)b. The congressional scheme does not intrude on the jurisdiction of the judiciary

i. The limited jurisdiction that the CFTC asserts over state law claims is necessary in context of the adjudication of federal claims willingly submitted by the applicants

viii. Granfinanciera v. Nordberg: Jury must resolve dispute, agencies cannot usurp common law claims

1. Issue: whether a person who has not submitted a claim against a bankruptcy estate has a right to a jury trial when sued by the trustee in bankruptcy to recover an allegedly fraudulent monetary transfer The dissent in UC and Schormajority in Gran Financiera in context of 7th Amendment

2. Holding: that jury must resolve any dispute that could have been resolved at common law at time 7th amend was ratified

a. Congress may only deny trials by jury in actions at law where public rights are litigated

b. If the right in question is legal in nature, then it carries with it the 7th amendment guarantee of a jury trial

c. A bankruptcy trustee’s right to recover (even under federal statute) is more accurately characterized as a private right

3. ***this is inconsistent with previous cases: Court is poised to say that most agency decisions will be unconstitutional

a. BUT there is some logic: In cases that do not involve agencies, courts create grave doubt with respect to the constitutionality of adjudicatory regimes

ix. DOCTRINE TODAY1. Unresolved Issue of What Constitutes a Private Law Dispute

a. Any dispute b/w private individuals or entities (e.g. private common law dispute, K dispute, fed workers comp rate regulations)?

b. Any dispute that existed at common law (e.g. common law tort action, K dispute)?

c. Any dispute in which common law applie2. Public Rights: Can be adjudicated by agencies

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a. Disputes b/w an individual & a govt. agency (e.g., application to obtain Social Security benefits, tax disputes, Ks)

b. Disputes over a statutory entitlement (e.g. Social Security benefits created as a statutory entitlement)

3. Summary: The analysis the Ct. uses for adjudicative delegations cannot be easily summarized. The ultimate question appears to be whether the delegation impairs either an individual’s interest in having a claim adjudicated by an impartial Art. III judge or the structural interest in having an independent judicial branch decide matters that have traditionally fallen w/i the core of Art. III business.

XIV. CONGRESSIONAL MEANS OF INFLUENCING AGENCIESa. Statutes

i. APA: Congress specifies rulemaking process1. Practical effects of formal/informal have on agency rulemaking

ii. Freedom of Information Act1. Requires each agency to publish its rules and final decisions in the federal register

a. Intended to make functions of government more transparent so public could identify and fix problems

2. Agencies are required by statute to respond to FOIA requests within 20 days a. Rarely happens because of burden on agenciesb. As long as agency is using “due diligence” to respond to the request, everything

is kosher – Open America Casei. The court can give priority to a request only if some “exceptional need

or urgency attached to the request justified putting it ahead..”c. Despite the urging of the FBI, congress has not (and will not) provide the

agencies with the resources required to keep up with request demands iii. National Environmental Policy Act

1. Requires every agency to prepare an environmental impact statement before it takes any major federal action that has a significant effect on the environment

2. Can greatly increase cost of socially beneficial regulationsiv. Civil Service Act

1. Creates a meritocratic system of hiring, evaluating and managing agency employees2. Makes it extremely difficult for managers in agencies to fire or discipline inefficient

workers3. Makes it difficult for Potus to implement his agenda when agency workers do not agree

v. Information Quality Act1. Requires agencies to act only on the basis of high quality information2. Can create scenarios where litigants can delay agency actions by challenging the

research that is the foundation of their ruleb. Allocation of Litigating Authority

i. Allows some agencies to enforce their own rulesii. Those who cannot must rely on the DOJ, where political priority can delay enforcement

c. The Confirmation Processi. The senate uses the confirmation process for four purposes

1. Means of vetoing the President’s choice2. As a source of leverage to extract commitments from a nominee3. Can threaten to embarrass agency at confirmation hearings4. Can threaten to decline all other choices to prevent transition

d. The Appropriations Processi. Congress can fund or defund agency department or functions via appropriations bills

ii. Often times funding is linked to particular agency actionse. The Oversight Process

i. Oversight committees bring in agency personnel and take them to task

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f. Caseworki. Members of congress often aid constituents in working with agencies

ii. Studies have shown that because legislators do more casework than legislative work, they are more inclined to create agencies with vast discretionary powers that they can more directly influence for their constituents

g. In adjudicatory context, Congress influence limited by due process [neutral decision power]h. ***Change in Congress is the change in what agencies do [not necessarily White House]

XV. LIMITS ON CONGRESSIONAL POWER a. Due Process

i. Pillsbury Co. Federal Trade Commissionii. Facts: FTC brought complaint against Pillsbury which was pending before the Commission when

the Chairman was summoned before the antitrust subcommittee of Congress1. The subcommittee forcefully expressed their opinions that a per se doctrine should

apply and that it was the intent of Congress that it should apply2. The questions were so probing that the Chairman was finally forced to disqualify himself

from further participation in the Pillsbury case. iii. Holding: Court found that the subcommittee proceedings were an improper intrusion in the

adjudicatory process of the FTC and were so damaging that it required members of Commission to be disqualified. This sacrifices impartiality, and therefore justice required that the order be invalidated.

b. Procedures Required to Legislate i. Up until INS v. Chadha, Congress enacted more than 200+ provisions allowing Congress to

approve/disapprove agency actions through measures that fell short of full blown legislation (i.e. single resolution passed by either House of Congress).

1. Argument for: Congress lacks the expertise and foresight to state meaningful standards in advance, but Congress can, and should, veto actions that it determines to be inconsistent with public interest.

2. Legislative veto was rarely used.ii. INS v. Chada

1. Chadha overstayed his student visa, but immigration judge ordered that his deportation be suspended on the grounds that he had resided in the US for over 7 years, was of good moral character, and would suffer “Extreme hardship” if deported

2. Once this recommendation was conveyed to Congress, they had power to veto this determination and they didChadha was ordered to be deported (resolution was not submitted to Senate or President)

3. Holding: the act is not in conformity with constitutional standards for legislative action, which sets forth that it must be passed by a majority of both houses and presented to the President.

a. Two-House veto violates Presentment Clause and one-House veto also violates Bicameralism

b. Exceptions:i. House of Reps alone given power to initiate impeachment

ii. Senate alone given power to conduct trial following impeachment on charges initiated by House and to convict following trial

iii. Senate alone was given unreviewable power to approve or to disapprove presidential appointments

iv. Senate alone given unreviewable power to ratify treaties negotiated by President

4. Note: actual relationship between non-delegation and legislative veto is opposite of what this case presents

a. If you don’t delegate the power to the agencies without discretion, then the court is adopting that power for themselves

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5. In 1996 Congress passed the Congressional Review Act where Congress can veto a major rule only by enacting a joint resolution of disapproval subject to presented to and potential veto by the President

a. Used once-is this constitutional???iii. Bowsher v. Synar

1. Background: Originally Presidents had a lot of discretion over expenditures of funds that Congress appropriated but this discretion disappeared over time as Congress broke budget into thousands of accounts

a. Congress eliminated Presidential discretion to not spend funds in response to many perceived abuses of power by then President Nixon.

2. Case: Statue requires CBO and OMB to make projections and then send to CG, who makes final projection that binds Pres

a. If any fiscal year the budget deficit exceeds the max deficit amount by more than a specified sum, the Act required across the board cuts in fed spending.

i. Comptroller General office requires nomination by President but the removal is by Congressional joint resolution.

3. Holding: This is a violation of Sep of Powersa. Here Comptroller performing executive functions under the Act. Congress

cannot reserve for itself the power of removal of an officer charged w/execution of the laws (Except for impeachment)

i. Okay but no CG has ever been removed….see dissentb. CG cannot determine spending levels because that is an inherently executive

decision i. Pierce: But look at the constitution...spending takes place through

appropriations which comes from the house!!4. Dissent: Real question to be answered here is whether the threat of removal of the

Comptroller General for cause through joint resolution renders Comptroller sufficiently subservient to Congress…NO

a. Removal is only permitted for specified cause, subject to post termination judicial review AND be presented to the President, and if it is vetoed by him, then would have to overridden by the 2/3 majority of both houses of Congress

5. Concurrence: CG cannot determine spending levels because Congress can only act in a way that binds Pres. through bicameralism and presentment

XVI. EXECUTIVE POWER OVER AGENCIESa. Sources of constitutional power

i. Vesting clause: part of the Constitution; court has relied on thisii. Opinion in writing clause: suggests that every officer report to the Pres, but hasn’t been used in

any case but one where an agency tried to go around the WH to submit budget to Congress iii. Take Care Clause: Pres “shall take care” that laws be executed; Scalia uses this to support claim

that no one but Pres can implement any public law ; if Congress does not delegate power to the Pres but a head of agency, then that person has to execute the power

iv. Commander in Chief Clause: subject to a lot of litigation v. Unitary executive: sole executive; does not answer questions, provides a means to answer

questions vi. Appointments clause

1. Only President may appoint officers under Article II §2 with Senate confirmation. Inferior officers can be appointed by President alone.

2. Who is an officer??B. Buckley v. Valeo: Congress does not have the power to appoint commissioners

I. Fact: Federal Election Campaign Act creates Commission to enforce Act (duties include recordkeeping, disclosure and investigative functions BUT ALSO extensive rulemaking and adjudicative powers).

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1. Commission of 6 members who can vote: 2 appointed by Senate, 2 by House, 2 by President AND each of 6 must be confirmed by majority of both Houses of Congress + political party requirements.

II. Issue: Whether CON for Commission to exercise the powers it does based on the way in which the members are appointed.

III. Holding: Any appointee exercising significant authority is an Officer of the US and must be appointed by Appointments Clause

1. Here, for 4 of 6 voting members neither EXEC, judiciary, or head of any department has any voice; other 2, EXEC nominates but must be approved by both houses of Congress

2. Enforcement powers and rulemaking/advisory/adjudication powers may only be exercised by persons who are Officers of the US (appointed by Appointments Clause)

iv. Contrast with Members of Civil Rights Commission can be chosen by Congress 1. Distinction is Civil Rights commission cannot sue or be sued, issue any rules, adjudicate

or make any final decisions, can only investigate or make reports v. Post-Buckley: Congress reenacted the statute simply changing it so all 6 voting Commissioners

were nominated by President subject to confirmation by Senate (hard to reach consensus); 2 non-voting members still appointed by Congress AND still no more than 3 members can be of same political party

c. Federal Election Commission v. NRA Political Victory Fund i. DC Circuit case challenges two characteristics:

1. Can Congress choose non-voting members of an agency?a. Commission tries to assert that non-voting members have no influence on

agency decision-making BUT this would be contrary to original Congressional intent to exert influence through those members (legislative history)

b. Conclusion: Since the legislature can with the greater facility, mask under complicated and indirect measures the encroachments which it makes on the co-ordinate departments, the mere presence of agents of Congress on an entity w/ EXEC powers offends the CON

2. Can Congress restrict President to nominating no more than the bar majority of members from the same party? DC Circ says this claim is not justiciable until it would be ripe but the only way this could ever become a ripe issue is if a Pres would nominate a fourth person of a political party and Senate confirms

a. President never tried to appoint more than 3 from same partyb. More likely that if he wanted to and did not it’s b/c of the political situation and

not the law itselfc. *Note: FEC often ineffective b/c divide 3-3 on issues – proposed remedial

response is to give ALJs more power – allow them to issue rules and to issue final decisions in adjudications

ii. Supreme Court refused to consider on basis that FEC cannot litigate before Supreme Court 1. Unless statute specifically confers jurisdiction on an agency to represent US in the

Supreme Court, then the agency doesn’t have the power 2. The issue that they were concerned with was never going to happen because the legal

issue would never come up because the political system would never allow it!a. No way four members are going to get approved by Senate

d. Status of ALJs i. Landry v. FDIC (DC Circ, Denied Cert) : Two judge majority held that ALJs are employees

1. Facts: Congress gave FDIC power to remove a bank officer and bar him from further work in federally insured depository institution; removed Landry in this way and he protested that the FDIC’s method of appointing ALJs violates the Appointments Clause

2. Relied on APA 557 b which authorizes an agency to substitute its own opinion for that of an ALJ as if the ALJ had never issued an opinion

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a. Any change in law that increased the legal effect of ALJ decisions would make them officers or inferior officers

b. Would force changes in the manner in which they are selected and require a change in law that would authorize the President to remove ALJs in some circumstances

3. Dissent: ALJs are inferior officersa. ****Remember: ALJs are selected by a test, get pts for experience, + 20 pts for

being a vet...so no pt in applying if not an vet b. ****PIERCE WROTE AN ARTICLE about SSA administration, where ALJ’s are like

inferior officers because as a practical matter, all ALJ decisions are final decisions because they don’t have the resources

e. What Kind of Officer: Principal or Inferior?i. Two different avenues of appointment for Officers of the US

1. Principal officers must be appointed by the President and approved by the Senate2. Inferior officers may be appointed by President, Courts of Law, or Heads of Departments

as Congress sees fitii. Morrison v. Olson: Independent counsel is an inferior officer

1. Facts: In wake of saturday night massacre, Congress authorizes “independent counsels” to investigate and/or prosecute criminal conduct by Pres and high-ranking officers.

a. IC is appointed by special 3-judge court and can be removed by AG only for cause

2. Holding: Appointment by court is ok because IC is an inferior officer.a. Limited duration;b. Limited scope;

i. Applies only to certain federal officials suspected of certain serious federal crimes

c. Inferior to AG because must comply with DOJ policies and can be fired for cause;i. Even though has independent discretion which takes independent

counsel outside of AG/EXEC subordinance, removal power makes subordinate

d. No power to make policy. i. Investigation and prosecution for specific federal crimes

ii. Can’t formulate policy3. Scalia’s Dissent: Prosecution has “always & everywhere” been an executive function

iii. Edmonds and Freytag [if someone is an Inferior officer or not, can be appointed by Court Judges]; Tax Court Judges are officers

1. Why are members of the Coast Guard of Appeals and Special Trial Judges in the Tax Court “inferior officers” while Judges on the Tax Court are “officers” [opinion in Freytag, concluding special judges appointed by Tax court are inferior officers, but the regular judges are officers]

a. Have the power to make final decisions, subject to only deferential review, distinguishing them from ALJs

b. Can’t be removed by any superior officers c. The special judges: Don’t get to make final decisions, can only make ones that

are subject to plenary review and can be removed by the Chief Judge of the tax court

2. How are CG judges inferior to CG JAGa. Just assigning them to a new location, doesn’t require any new process from

nomination of Pres and confirmation b. JAG can remove them

3. In what ways are CG judges inferior to Court of Appeals for Armed Forces?

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a. Opinion suggests that the court should look to their power of final decision or can be removed by someone who is an officer [similar to Morrison v. Olson]

iv. Freytag: 1. Court unanimously holds that special judges of the tax court can be appointed by chief

judge [or head of dept]2. 5 justices say tax court is court of law even though it is not an article III court

a. tax court used to be board of tax appeals, part of the executive branch 3. 4 justices says tax court is an executive branch department

a. say to combat that the only thing that counts as a dept is a cabinet department v. PCAOB

1. In 2010 Court held that SEC is a dept and the 5 commissioners are its head for appts clause purposes

2. PCAOB members are inferior officers only because majority holds that they must be removable at will by SEC members

a. SEC is an independent agencyf. Recess Appointment Power

i. Article II, Section 2, Clause 3 of CON: President has power to fill all vacancies that happen during Recess of the Senate by granting Commissions which shall expire at the end of their next session

1. Since 1960 Senate Resolution discouraging recess appointments to SC, number of judges appointed that way has greatly declined BUT still very common for Presidents to make recess appointments to fill EXEC positions AND remains very controversial

a. Issues with what constitutes a Recess (a few days off or needs to be longer period)

b. Whether there is a requirement that vacancies initially arise or merely exist during recess

c. Whether President can make recess appointment to replace a member with an expired term when it is for a commission with a holdover clause (old member remains until successor takes office)

ii. From 2006 until 2010, NLRB had only two members. [Congress refused to confirm any of Bush’s then Obama’s nominees]

1. In 2010, Supreme Court held it had no power. In 2010 President Obama made 3 recess appointments of members Congress refused to confirm.

a. The decisions between 2006-2010 with lack of commissioners did not have quorum to be an agency that could exercise any of the powers of its act

b. Agencies are headed by multi member groups, no more than just the bare min majority can be members of the same party

c. Senate creates the de facto session rule they will never have a recess iii. Inability to get an appointment confirmed depends on the political environment

1. Always someone who can become the “Acting head” even though they may not have the title while someone is being waited to be confirmed

iv. If Congress creates a new agency, could be a different deal depending on the political considerations

g. Power to Removei. CON does not mention power to remove officers BUT all Presidents assert the power to remove

subordinate exec officials from office1. Never been an attempt by Congress to say that President cannot remove an officer

(sometimes threaten too), the question is whether congress can LIMIT that power ii. 5 major cases: Myers, Humphrey’s, Wiener, Morrison, and PCAOB

1. The first 3 no longer mean what they were widely believed to mean, but each has important meaning today…

iii. ***Pierce doesn’t think for cause removal has a lot of effect political is more important

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iv. Myers v. United States –where postmaster was removed from his post by President in defiance of statute that says President cannot remove any officer w/o Senate confirmation

1. Holding: The court determined that under the CON, the President has exclusive power of removing executive officers of the US whom he appointed w/ consent of Senate

a. Power of removal is different from that of appointmenti. Veto by Senate upon removal is a far greater limitation upon the

executive branch and cannot be implied (if exists must be explicitly stated)

ii. No embarrassment to President to reject nominee – different to force him to remain with someone he cannot work with

iii. Senate learns of capabilities/qualities of nominee but is not well advised to defects in intelligence or loyalty of President’s workers

b. Also, power of removal to Congress is not enumerated anywhere in CONc. President must have utter faith in his executive subordinates to do his job

2. *Note: not the law today…today it stands for:a. Whatever else Congress can do in terms of limiting Pres’ power, it cannot have

a role in the process itself [that would turn it into a congressional agency itself and Bowsher limits that]

v. Humphrey’s Executor v. US: President cannot remove at will those officers exercising quasi-legislative functions; Congress can limit Pres “for cause”

1. Facts: President Hoover appointed, and the Senate confirmed, Humphrey as a commissioner of the Federal Trade Commission (FTC)

a. President Roosevelt asked for Humphrey's resignation since the latter was a conservative and had jurisdiction over many of Roosevelt's New Deal policies.

b. When Humphrey refused to resign, Roosevelt fired him because of his policy position but the FTC Act only allowed a president to remove a commissioner for cause

2. Holding: President cannot remove an FTC Commissioner w/o stating a cause b/c:a. Statute specified a fixed term of years and limited removal to “for cause”b. Agency’s functions (in 1935) were not executive or political but were quasi-

legislative and quasi-judicialc. Agency was independent of all control by President and Congress

i. Without some insulation, a President might exert undue influence and say they would like a case decided for X is this a violation of neutral decision maker function of due process

d. Distinguishes Myersi. Can’t apply here because it is based on the theory that an officer is

merely one of the units of the executive department (inherently subject to the exclusive and illimitable power of removal by the executive)

ii. FTC is not an arm or eye of exec-it’s an independent agency3. Case Today

a. Independent Agenciesi. An agency is called “independent” if it is headed by multiple members,

nominated by the President and confirmed by the Senate, with no more than a bare majority of members of the same party, subject to staggered fixed terms, and subject to President removal only for cause

b. Can’t mean that it is directly accountable to the people, but if Congress has justification, that’s some limit

vi. Wiener v. United States: Pres removal power; limit today is removal for cause1. Facts: Congress created War Claims Tribunal to resolve WWII claims “according to law.”

Pres nominated members subject to Senate confirmation. Statute was silent re removal.2. Court draws inference that Congress intended to limit Pres removal power

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a. TEST: Court evaluated (under Humphreys) whether the Commission and its commissioners were either:

i. Part of the “executive establishment and thus removable by virtue of the presidents constitutional powers,

ii. Part of a body to “exercise judgment without the leave of hindrance of any other official or any department of government

b. ***The most reliable factor for drawing an inference regarding the President's power of removal is the nature of the function that the Congress vested in the war claims commission

i. What were the commissions duties?ii. Can an inference be fairly drawn from the failure of congress to provide

for removal that these commissioners were subject to the will of the executive?

3. Case Today:a. Wiener may still have meaning in some unusual contexts, but courts no longer

assume that Congress intended to limit removal power when statute is silent on issue.

b. Consistent with Humphrey in that Congress can insulate some of the President’s power to remove

c. Circuits have had these cases, not Supreme Court said it doesn’t matter whether statute is silent, baseline assumption is Pres has plenary power to remove, only thing that overcomes is a Congressional limit to only remove for cause

i. Strained to apply today, only apply in particular circumstances [tribunal functioning as courts]

vii. Morrison v. Olson in Removal Power Context1. Issue: whether the “provision of the Act restricting the attorney general’s power to

remove the independent counsel to only those instances in which he can show “good cause”, taken by itself, impermissibly interferes with the presidents exercise of his constitutionally appointed functions”

2. Unlike Myers and Bowsher, the Act puts the removal power in the hands of the executive branch

a. an independent counsel can be removed from office, “only by the personal action of the attorney general, and only for good cause”

b. there is no requirement of congressional approval of the AG’s decision, but it is subject to judicial review

3. Holding: This arrangement does not interfere with President’s power to “take care that the laws be faithfully executed because

a. some degree of insulation is justified by Bonham’s case (no man can be a judge in his own case) so when you’re investigating the Pres, okay to have isolation

b. No attempt at congressional aggrandizement of power, unlike Chadha, Bowsher, etc.;

c. Plenary control over investigation and prosecution of a single case is not central to President’s ability to control Executive Branch

d. IC has no policy-making powere. President still has some power over IC through AG

4. Scalia Dissent: [prefers Myers to Humphreys]a. Prosecution has been an exclusively executive function “always and

everywhere” (this is not true);i. In the past, prosecutors appointed by leg + courts

b. Court has replaced prior fuzzy limit on Presidential power with no limit at all

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c. Is Scalia right that the Court would have to say the same things regarding an Ass’t AG or Secretary of State

5. ***Congress eventually agreed with Scalia’s policy arguments and abolished IC positiona. Too time consuming and burdensome to comply with IC investigation

viii. PCAOB 1. In 2010 Court held that Congress cannot create an agency that is run by individuals

subject to double insulation from presidential control, ie removable only for cause by an officer who is removable only for cause

2. Court assumes that SEC members can only be removed for cause even though statute has no for cause limit

3. 5 Justice Majority wanted to send a very broad message a. Written by the chief justice, who is always reluctant to override precedent

XVII. OTHER PRESIDENTIAL ATTEMPTS TO CONTROL AGENCIESa. The legal framework by which presidents exercise power is surprisingly underdeveloped – the SC has

decided only a handful of casesb. In re Neagle

i. Where the Attorney General hired a SC justice a body guard for his trip to California without any statutory authority, who then shot someone who had previously threatened the justice and was acting “ambigiously”

ii. The bodyguard was then charged with murder by the state of CA, and defended under the supremecy clause

iii. Holding: upheld the bodyguard’s defense and the AG’s power to hire him (does this surprise you?)

c. Youngstown Sheet & Tube v. Sawyer i. Perhaps the most important case is Youngstown in that it addresses the scope of presidential

power1. It arose when the steelworkers union and the owners were unable to resolve a labor

dispute2. Believing that the shutdown of the steelmills would be detrimental to the war in Korea,

Truman seized the mills and had the operated by the government ii. Issue: Whether the President has the power to authorize the Sec of Commerce to seize the steel

mills under executive powers in article IIiii. Holding: FRAMEWORK OF AUTHORITY

1. GREATEST AUTHORITY (Jackson): when President exercises power delegated expressly or impliedly by Congress, his power is “at its utmost”

a. The seizure executed by the presidents pursuant to an act of congress would be supported by the strongest of presumptions

b. Clearly no Congressional statute here, so not greatest authority + Congress has actually enacted the Taft-Harley Act against this

2. Middle Authority: When Pres exercises his power in a statutory vacuum, his power is “uncertain”

a. When the president acts in absence of either a congressional grant or denial of authority, he can only rely on his own independent powers

b. Congress=President Power, test of power is likely to depend on imperatives of events

c. Can’t apply any of President’s other powers: executive, commander in chief, take care, emergency/inherent power

3. Lowest Authority : When President acts contrary to will of Congress, his power is “most dubious”

a. **Distinction between disallowing this completely and just saying its “most dubious”

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b. He can rely only on his constitutional powers minus any constitutional powers of congress over the matter

4. Notes: a. There are no cases in justice Jacksons third category in which the supreme court

has upheld a presidential action that the court determined contrary to the “express or implied” will of congress

b. Lesson learned from this case is be in one of the first two categories and when in doubt, ask Congress

d. What else does the President got to use?!i. Every President from FDR to the present has complained re inadequate ability to control and

coordinate the sprawling bureaucracy, and each has moved further in exercising systematic control.

1. It is important to remember, however, that most Presidential influence over agencies is now, and always has been, ad hoc and low visibility

ii. Removal Power: Presidents can remove most officers without reason for doing so1. However, presidents are extremely reluctant to use their removal power

iii. Presidential Signing Statements 1. Presidents have taken the opportunity when signing bills to issue formal statements

offering their views regarding the legislations constitutionality or meaning a. Reagan expanded this policy- issuing over 250 signing statements

iv. Ad hoc Jawboning: Studies find that 18 White House offices in addition to OMB jawbone agencies behind closed doors; offices often take inconsistent positions; in most important cases, other offices have more influence than OMB.

v. Executive Orders:1. EO’s are presidential directives that govern the actions of government officials and

agencies and carry the force of law2. The constitution does not explicitly authorize the president to issue EO’s

a. Presidents have claimed that the provisions of article II, or more ambiguous statutory language authorize their orders

3. EO’s Require agencies to engage ina. Regulatory Planning Processb. Conduct cost-benefit analysis on major rules c. Submit proposed rules to OMB/OIRA for review prior to publication

4. The OMB evolved from the Bureau of the Budget, which congress created in 192a. Purpose to “assemble, correlate, revise, reduce, or increase the budget

estimates of the several departments or establishmentsb. The bureau became a sort of information clearinghousec. Allowing the president to discern what agencies were doing and influence their

actionsvi. Reagan 12,291: Formalized Office of Information of Regulatory Affairs processes in order to allow the

President more control over Agency actions1. Requires Agency to review rulemaking through2. Required cost/benefit analysis, consultation with other agencies, and additional data

a. You need to go talk to the X agency, we can require that you do! i. If you are a lawyer for a client, submit thorough comments!

ii. Meet we every member of the agency that you can (on average 1200 meetings during the process of creating a rule at the EPA!)

1. During those meetings you hand them your comments and explain them, or they might not read them

3. Authorizes OMB to require delay of Agency publication until they have had an opportunity to review ita. District court case: Delay related to presidential review may be reasonable when there is no

statutory deadline, but unreasonable when there is a deadline that has passed

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4. Only applies to “major rulemaking”—$100 million/year in regulatory costsa. Why? Too many to be reviewed!

5. About 200 rules a year in that categorya. **Doesn’t apply to adjudications, so agency head make all major policy decisions in process of

adjudicating individual disputes 6. Applies only to major rules issued by Exec Branch agencies 7. Applies only to the extent consistent with law8. Requires CBA and rules consistent with CBA

a. How does this fit with State Farm and Chevronvii. Reagan EO 12,498

1. 12291 was a disappointment to many so they came up with this EO instead, it gets intervention by the WH earlier

2. Requires Executive Branch agencies to issue periodic regulatory agendas with info re pending and planned rulemakings.

3. Designates VP as Head of Competitiveness Council with power to resolve disputes between OMB and agencies.

4. Imagine how such disputes are resolved. What, if any, relationship would you expect between the resolution of such disputes and the President’s removal power?

viii. **Bush 41 retained Reagan EOs. i. Clinton EO 12,866

1. Includes all major elements of Reagan EOs.2. Expands 12,498 requirements to apply to “independent agencies.”3. Adds time limits for each step in review process.4. Adds transparency requirements re status and communications.

a. Now we have regulations.gov with all the public comments and information about ex parte meetings with regulators

5. In addition, Clinton took personal credit for some rulemakings, e.g., “today, I have directed the ____ to ____”

a. No president had done this before, they usually did it quietly and informally b. He did it selectively, b ut formally on tv

i. May the agency was going to do it on their own, maybe they weren't-we never know if agency wasn't going to do anyway

ii. Did it about 100 times, for politically beneficial things 6. Pierce: This is just a very verbose version of 12,291--> doing the same thing that Reagan + Bush Sr did

ii. Bush 43 1. Reaffirmed 12,866 with one change—VP no longer has any role (but see the 2007 Wash. Post report

re low visibility intervention in regulatory matters.)2. Continued Clinton practice of directing agencies to start rulemakings, but added directives to rescind

or amend rules.3. Placed lots of emphasis on precluding agencies from publicizing or acting on the basis of low quality

data. (Of course, data quality is often in the eyes of the beholder.)4. EO 13422 extended review process to major guidance documents5. Required each agency to designate “in coordination with” OMB a Regulatory Policy Officer who must

be political appointee and need not be agency head6. RPO decided whether agency could begin rulemaking or issue rule

**Revoked by Obama

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