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Enforcing Anti-Money Laundering Statutes Through

Guidance Documents

ADMINISTRATIVE & REGULATORY LAW NEWSVol. 31, No. 2 Winter 2006A m e r i c a n B a r A s s o c i a t i o n

Sect ion of Admin is t rat ive Law & Regulator y Pract ice

2006 MIDYEAR MEETING � CHICAGO, IL � FEBRUARY 10-12, 2006

A l s o I n T h i s I s s u e■ Vermont Yankee Revisited■ Using Student ALJs for Unemployment Insurance Appeals■ 2005 Administrative Law Conference■ Law Student Essay Competition

Enforcing Anti-Money Laundering Statutes Through

Guidance Documents

This Section is at its best when debating policy issues thatconfound policymakers,the bar and the public.The current andincoming Section chairs share the goal of increasing the Section’spolicy making activities.While fun,these policy making activitiesare an enormous public service. This section with its uniquecomposition,political diversity and incredible intellectual talent canreally provide sound expert advice that reflects superior thinkingon administrative law issues.

Shortly,the Section will submit comments on the Office ofManagement and Budget (OMB) Proposed Bulletin for GoodGuidance Practices.OMB provides a definition of guidance,describes the legal effect of guidance documents,establishes prac-tices for developing guidance documents and receiving publicinput,and establishes ways for making guidance documents avail-able to the public.Also,the proposed Bulletin clarifies thatguidance document are nonbinding and should not includemandatory language unless the agency is describing a statutory orregulatory requirement.

The Section’s comments addressed the problems associated withmandating a process for making major guidance documents.Thecomments admonished that making it difficult for agencies to giveguidance on routine matters might discourage them from doingso.The comments also expressed concern that the proposedBulletin does not adequately distinguish among the different typesand impacts of guidance documents in determining when thepolicy making procedures apply.The Section’s comments went onto discuss background legal principles governing interpretive rulesand policy statements,among the most complex in administrativelaw. The Section comments also suggested that the Bulletinaddress other aspects of the guidance process such as required stepsunder the Administrative Procedure Act (APA) when guidancedocuments are issued,such as,publication requirements in § 552 ofthe APA.Finally the comments point out that the Bulletin avoidstwo more problematic issues associated with guidance documents— how to communicate effectively to the public that policy state-ments are not binding on regulated entities or the agency thatissued them,and how to advise members of the public that theymay rely on the guidance.

The e-mail debate among the Section leadership in developingthe comments was splendid.Professor Bob Anthony immediatelystarted the perennial debate over whether agency guidance docu-ments were binding.Professor Peter Strauss fired back thatguidance documents in the form of staff manuals and the like werebinding on the agency employees but could not be enforced byregulated parties.Such guidance is desirable information toregulated parties even though nonbinding in effect.

Dan Troy,Chair Elect and former General Counsel of theFood and Drug Administration (FDA),offered the experienceof the FDA guidance development process. In the FDA’sprocess,which the OMB Bulletin acknowledged as a model,

the word “should”meant “we recommend”and guidancedocuments clearly indicated their non-binding character.Moreimportantly,FDA clearly invites regulated entities to talk to theagency about different approaches to compliance (21 CFR Sec.10.115,Good guidance practices).

Then some government attorneys jumped into the fray withconcerns about the practical implications of guidance docu-ments for their agencies.And the law professors argued the finepoints of the complex administrative law on non-legislativerules.At this point,an e-mail from a former chair came acrossthe wires:

I have to say that this great debate is simply fun to observefrom afar — the Section at its prime. . . . [T]here is so muchgood material here.Have at it!!

Also at this point,a consensus began to emerge.Commenta-tors acknowledged that debates over first principles and theorywould not generate needed Section consensus nor really benefitOMB.What resulted was a final thoughtful letter,crafted prima-rily by Professor Sid Shapiro,Co-Chair of the Regulatory PolicyCommittee,which pointed out some of the theoretical and prac-tical difficulties with the proposed OMB Bulletin.As this columngo to press, the Section is preparing the final comment letterwhich will be on the Section website soon.

This year has been rich in opportunities for the Section tocomment on important administrative law and policy issues.Earlier this fall, through the fine work of the AdjudicationCommittee and Benefits Committee with Jeff Lubbers pullingthe comments together, the Section submitted excellentcomments on the proposed rule reforming the Social SecurityAdministration’s disability appeals system.The Section also has arecommendation before the ABA House of Delegates thisFebruary urging the Attorney General to issue a memorandumto Freedom of Information Act (FOIA) officials at federal agen-cies clarifying that the designation of agency records as “sensitivebut unclassified”cannot be a basis for withholding agencydocuments from release.And there is more to come.

Also to come are several excellent programs.At the midyearmeeting,we have on antitrust program on Antitrust Liability forDeceptive Comments in Rulemaking—The Unocal case,another antitrust program on the Antitrust ModernizationCommission,and a third program of program of SeventhCircuit judges entitled “Law,Fact,and Discretion:SeventhCircuit Judges Talk about Deference.”We also have great plansfor the Section dinner on Saturday night and a Sunday morningbreakfast program on Updating Lobbying Regulation.

Our first annual Homeland Security Institute is on January20th with an array of strong speakers. In April we have oursecond Administrative Law Institute focusing on lobbying.Thenit is on to Bermuda for our spring meeting at the Elbow BeachClub and on Hawaii for the ABA Annual meeting.

Administrative and Regulatory Law News Volume 31, Number 2

Chair’sMessage

Eleanor D. Kinney

ADMINISTRATIVE & REGULATORY LAW NEWS

The Administrative & Regulatory Law News (ISSN 1544–1547) is published quarterly by the Section of Administrative Law & Regulatory Practiceof the American Bar Association to provide information on developments pertaining to administrative and regulatory law and policy,Sectionnews, and other information of professional interest to Section members and other readers.

The Administrative & Regulatory Law News welcomes a diversity of viewpoints.From time to time, the editors may publish articles on controversialissues.The views expressed in articles and other items appearing in this publication are those of the authors and do not necessarily represent theposition of the American Bar Association, the Section of Administrative Law & Regulatory Practice,or the editors.The editors reserve the right toaccept or reject manuscripts, and to suggest changes for the author’s approval, based on their editorial judgment.

Manuscripts should be e-mailed to:[email protected] should generally be between 1500 and 2500 words and relate to currentissues of importance in the field of administrative or regulatory law and/or policy.Correspondence and change of address should be sent to:ABASection of Administrative Law & Regulatory Practice,740 15th Street,NW,Washington,DC 20005–1002.

Nonmembers of the Section may subscribe to this publication for $28.00 per year or may obtain back issues for $7.00 per copy.To order, contact the ABA Service Center,321 North Clark Street,Chicago, IL 60610,Tel. 800/285-2221.

©American Bar Association 2006.Articles appearing in this publication may not be reprinted without the express permission of the ABA.

Chair’s Message . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inside front cover

The Hazards of Enforcing Guidance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

From the Files of the Supreme Court:The Hidden Story of Vermont Yankee . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Student Administrative Law Judges:New Dimensions in Education and Efficiency . . . . . . . . . . . . . . . . . . . . . 7

2005 Administrative Law Conference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

2006 Midyear Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

Supreme Court News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

News from the Circuits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

2006 Gellhorn-Sargentich Law Student Essay Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

Recent Articles of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

News from the States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27

Editor in Chief: William S.Morrow, Jr.,Executive Director/General Counsel,Washington Metropolitan Area TransitCommissionAdvisory Board Chair: Michael Asimow,Professor of Law Emeritus,UCLA Law School Advisory Board Members: Robert A.Anthony,Former GMU Foundation Professor of Law,George Mason UniversitySchool of Law;Warren Belmar,Partner,Capitol Counsel Group,L.L.C.;Daniel Cohen,Chief Counsel for Regulation,U.S.Dept.of Commerce; John Cooney,Partner,Venable,LLP;Cynthia A.Drew, Associate Professor of Law,University of MiamiSchool of Law;William Funk,Professor of Law,Lewis & Clark Law School;Philip J.Harter,Earl F.Nelson Professor of Law,University of Missouri–Columbia School of Law; James T.O’Reilly,Visiting Professor of Law,University of CincinnatiCollege of Law Contributing Editors: Yvette M.Barksdale, Associate Professor of Law,The John Marshall Law School;Robin KundisCraig,Associate Professor of Law, Indiana University School of Law, Indianapolis;William S. Jordan III,C.Blake McDowellProfessor of Law,The University of Akron School of Law;Edward J. Schoenbaum,Administrative Law Judge, Illinois Department of Employment Security

Winter, 2006 Administrative and Regulatory Law News1

Tableof Contents


The federal Anti-Money Launderingprogram presents a fascinating casestudy of the unintended conse-

quences that can arise when an agencyattempts to enforce compliance standardsthat were established by informal guid-ance,rather than through a rulepromulgated under the APA.

The agencies that supervise depositoryinstitutions implemented the AML lawsin the same manner that they conductsafety and soundness regulation,byadopting rules of sweeping generalityand then elaborating the actual standardswith which institutions must comply indetailed guidance and examinationmanuals.Whatever its success in tradi-tional bank regulation, this approachcreated substantial problems when theagencies sought to enforce the AMLguidance after the 9/11 attacks.

The government failed to anticipatehow banks would respond to thecombination of ambiguities in the guid-ance and aggressive civil and criminalenforcement.Many institutions quicklychanged their behavior in response tothe threats presented by the enforcementregime.Their reaction impaired theoverall effectiveness of the AMLprogram,and the government wasforced to back pedal.To persuade banksto reverse their changes in behavior, thesix principal regulatory agencies wereforced to negotiate and publish a joint300-page long guidance document thatset forth in minute detail the standardsupon which future enforcement actionswould be premised.

This experience demonstrates theprogrammatic risks of attempting to basea complicated regulatory scheme oninformal guidance and the possibleconsequences if government officialsunderestimate the industry’s need for

certainty in the face of regulatory riskspresented by an enforcement program.

Creation of the AML ProgramThe Bank Secrecy Act of 1970

required financial institutions to filereports on large-scale currency transac-tions, to provide law enforcement withan after-the-fact tool to prosecute moneylaundering connected to drug traffick-ing.The BSA vested Treasury withresponsibility for overall policy formula-tion but provided for implementationthrough the corps of examiners main-tained by the five financial supervisoryagencies (the Federal Reserve, theComptroller of the Currency, the Officeof Thrift Supervision, the FederalDeposit Insurance Corp., and theNational Credit Union Administration).

The agencies incorporated the AMLrequirements into their existing safetyand soundness-based complianceprograms,which generally require insti-tutions to identify the risks they faceand to focus their prevention programson the greatest risks. In safety andsoundness regulation, the agencies relyheavily on informal guidance and evenless formal manuals for field examiners.Large banks appreciate the flexibilityprovided by this informal approach;small banks tend to prefer the certaintyprovided by precise standards. Fewbanks, however, have found it in theirself-interest to file an APA challenge toa “requirement” imposed through guid-ance.A safety and soundness regulatorpossesses vast, and largely unreviewable,discretion.The agency has multiple waysto persuade the bank that it would bewise to comply with the agency’swishes, regardless of the format inwhich the obligation was articulated.

By the mid-1990s, advances incomputer technology allowed the super-visory agencies to refocus the AML

program on the systematic detection ofmoney transfers associated with majorfinancial crimes.The new system wasbuilt on two pillars: (1) a Customer Iden-tification Program,which makes banksresponsible for understanding the iden-tity,business, and expected activities oftheir customers, thereby establishing abaseline against which actual transactionscould be compared to identify anomaliesthat might warrant investigation;and (2)a requirement that banks file SuspiciousActivity Reports (SARs), to notifysupervisory and law enforcement agen-cies of potential illegal activity.FinCEN,the Office in Treasury responsible foradministering the AML program,and thefive supervisory agencies undertook amulti-year effort to promulgate commonrules that would impose these require-ments.Progress was slow,however,due todifficulty in breaking these broadconcepts down into concrete provisions.The process had not been completed bySeptember 2001.

Adoption of the USA Patriot ActTitle III of the USA Patriot Act (Pub.

L.No.107-56), adopted in the immedi-ate aftermath of the 9/11 attacks,changed the AML program in funda-mental ways.First,Congress added thegoal of preventing terrorist financing tothe purposes of the BSA.To comply,financial institutions had to make signifi-cant investments,especially in newtechnology and training, to develop thecapacity for real-time detection andreporting of potentially suspicious trans-actions.Second, the supervisory agencieswere required to expand the scope oftheir rules (e.g.,greater coverage ofcorrespondent banking and wire trans-fers) and were given tight deadlines foradoption of a large number of significantrules (notably the long delayed CustomerIdentification Program rule).

* Partner,Venalle,LLP;Advisory Board Member,Administrative & Regulatory Law News.

The Hazards of Enforcing GuidanceBy John F. Cooney*


The new rules followed a risk-basedapproach.They directed banks toconduct internal reviews of the productsand services they offered, their customerbase, and the geographic regions inwhich they operated; identify the riskspresented;make an explicit determina-tion that they could address the riskswith their personnel and technology;andfocus their prevention and auditresources on the greatest risks.Eachsupervisory agency expanded upon therules by issuing separate implementingguidance and adopted detailed examina-tion procedures that were applied on aninstitution-by-institution basis throughthe periodic examination process.

Aggressive EnforcementIn 2004,FinCEN and the supervisory

agencies undertook a series of BSAenforcement actions based on the“requirements”established by the guid-ance.Formal enforcement actionsinvolved coordinated application of theCease and Desist power of the bankregulator and the overlapping authoritiesof FinCEN and the regulator to imposeCivil Money Penalties.Enforcementfocused on international correspondentbanking,money transfers throughMoney Service Businesses (non-deposi-tory institutions that cash checks andmake wire transfers), and banks in south-ern Florida.Further,prompted by theirsuperiors, the field examination staffstook informal enforcement actions forAML violations against an unprece-dented number of institutions.

Banks were hopeful that, as in otherrisk-based areas such as credit risk, theywould be allowed to exercise informedjudgment about the size of various AMLrisks and the best means of managingthem;and that they would not be foundto have violated the BSA if an isolatedcustomer engaged in a suspicious trans-action,as long as the overall program wassound.The general perception within theindustry,however,was that whatever theagencies stated at a policy level, theexamination staffs disregarded the risk-based approach and followed a “zerotolerance”approach,under whichenforcement action would be taken if

any suspicious transaction occurred andwas not reported,even in low-risk areas.

The Department of Justice compli-cated the situation by bringing twomajor criminal prosecutions againstbanks for AML violations: (1) a deferredprosecution agreement with AmSouth,which resulted in a $50 million CivilMoney Penalty; and (2) a guilty plea byRiggs Bank to violation of the BSA in itsEmbassy Banking operations,whichresulted in a criminal fine of $16 million,a $27 million Civil Money Penalty, andultimately in the demise of the bank asan independent institution.

The Market ReactsBanks do two things: they collect

deposits and assess risks. Faced with thethreat of aggressive enforcement ofambiguous and informal compliancestandards, many banks concluded thatthey did not want to bear the apparentregulatory risks presented by certainproducts and certain types ofcustomers, and therefore exited thosemarket segments.

Embassy Banking.When Riggs wasforced to close accounts for foreignEmbassies,other banks refused to pick upthose relationships,due to the perceivedregulatory risks in those accounts and theenhanced degree of regulatory scrutinythat would accompany opening theserelatively small accounts.The inability offoreign governments to obtain bankingservices led to complaints to the StateDepartment,which in turn pressed Trea-sury and the Federal Reserve to issuepublic statements assuring banks that itwas permissible under the BSA for themto maintain Embassy accounts.

Money Service Businesses.Many banksdecided to close their MSB accounts,due to the intense scrutiny that fieldexaminers gave these relationships.Theirwithdrawal from the market created asubstantial risk that many money trans-mitters would be driven out of theformal banking system and would beforced to go underground.Thisresponse threatened to compromise theoverall federal effort to police a part ofthe financial industry that is particularlysusceptible to money laundering. Senior

federal officials repeatedly attempted toreassure banks that it was permissible tomaintain MSB accounts, as long as therisk could be managed properly.Manybanks, however, feared the punitivereactions of their examiners more thanthey trusted policy statements fromWashington, and continued to closeMSB accounts.

SAR Overreporting.Many banksresponded to the AmSouth and Riggsprosecutions by deciding to file a SARon any anomalous transaction, regardlessof its significance. In light of examinerpressure to enforce the reportingrequirements,many banks concludedthat the cost/benefit ratio was weightedin favor of filing a SAR,an inexpensiveministerial act, rather than attempting toexercise subjective judgment as towhether a transaction actually was suspi-cious and important.As a result, SARfilings in 2004-2005 reached unprece-dented levels. Senior federal officialscomplained repeatedly that this wave ofdefensive filings significantly changedthe signal-to-noise ratio, and was imped-ing the ability of law enforcement andintelligence agencies to identify thesmall number of filings that actuallywarranted investigation.

Public Criticism of Justice.Mirroringindustry complaints,Federal and Statesupervisory agencies publicly criticizedJustice for de facto criminalizing regula-tory violations by being overly zealous inbringing prosecutions for AML viola-tions. In response,Attorney GeneralGonzales rescinded the delegation ofauthority that previously had allowedindividual U.S.Attorneys to bring thecriminal charge involved in AmSouthand Riggs, failure to file a SAR,withoutprior authorization from Washington.Justice thereby centralized policy controlof criminal prosecutions to permitsystem-wide calibration of the enforce-ment threats faced by banks.

In response to the industry reaction,senior government officials initiated apublic campaign to persuade financialinstitutions that they misperceived therisks of AML enforcement and shouldstop acting in ways that threatened to

continued on next page


undermine the effectiveness of the BSAprogram.Those efforts largely failed.Banks objected that: (1) individual insti-tutions did not have sufficient notice ofthe actual standards to which they wouldbe held and were unwilling to exposethemselves to the risk of enforcementactions; and (2) administration of theAML program was producing competi-tive inequalities among industrysegments,because examiners in variousagencies implemented the few rules thatexisted in different ways.

Damage Control by the Government

The unintended consequences result-ing from AML enforcement forced thegovernment to respond comprehen-sively to industry concerns.The agenciesaddressed complaints of excessivereliance upon, and inconsistent applica-tion of, guidance by issuing moreguidance.FinCEN and the five supervi-sory agencies undertook a complicatedand time-consuming effort to negotiatecommon guidance.The resulting BSA

AML Examination Manual,made available on June 30,2005,exceeds 300pages. It sets forth in great detail thestandards to be applied by field examina-tion staffs in all industry segments.TheManual also conveys an implicitcommitment that future enforcementefforts will adhere to the “requirements”it establishes.

It is too soon to tell if this unprece-dented joint guidance will affect thebanks’ risk calculus and will satisfy a suffi-cient number of institutions that it is safeto reverse the defensive policies that,taken collectively,harmed the overalleffectiveness of the AML program.Theoutcome depends in large measure onwhether future civil and criminalenforcement actions respect the implicitcommitment in the ExaminationManual not to penalize a bank for theexercise of informed judgment, andwhether field examiners can resist thetemptation to sanction good faithdisagreements about risk assessments.

The broad lesson that can be drawn from the AML experience is a warning

to regulatory agencies of the potentialharm that can result from attempts toregulate complex economic behaviorthrough informal guidance,which doesnot give the regulated industry thecertainty provided by a formal rule.When the threats presented by a guid-ance-based scheme become excessivethrough enhanced enforcement, regu-lated entities can change course in amanner that protects individual institu-tions,but collectively threatens to defeatthe underlying government policy.Whilethe scale of the effort to implement theAML laws through guidance and theresponsiveness of the industry to changesin the risk assessment may be atypical,this case study illustrates a limit on theuse of guidance as a regulatory tool.At aminimum, in order to govern based onguidance,agencies must carefully inte-grate the enforcement component intothe regulatory program and mustconsider carefully the proper balancebetween the agency’s desire for flexibilityand the industry’s need for certaintyabout the governing standards.

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The Lobbying Manual, 3rd Edition provides you with a detailed map for compliancewith all applicable laws. Complete with dozens of real-world examples, this up-to-datebook is all you need to guide you through the maze of federal laws and regulations thatpertain to lobbying. The book describes the dramatic changes brought about by theLobbying Disclosure Act of 1995, and the considerable changes that have occurredsince the last edition was published in 1998.

Topics include:• Federal Lobbying Regulation: History Through 1954• The Lobbying Disclosure Act of 1995: Scope of Coverage• Registration, Reporting, and Related Requirements• Constitutional Issues Raised by the 1995 Lobbying Disclosure Act• Antitrust The Federal Trade Commission and the Department of Justice• Internal Revenue Code Limitations on Lobbying by Tax-Exempt Organizations• Foreign Agents Registration Act• The Byrd Amendment• Federal Acquisition Regulation Governing Lobbying • And much, much more


From the Files of the Supreme Court:The Hidden Story of Vermont Yankee

By Gillian E.Metzger*

Tucked into Vermont’s southeastcorner, the small town of Vernonmight seem an unlikely backdrop

for one of the most important decisionsinterpreting the Administrative Proce-dure Act (“APA”).But in 1966 theVermont Yankee Nuclear PowerCorporation applied for a permit tostart building a nuclear reactor along thebanks of the Connecticut River inVernon, and three years later applied foran operating license to run it.Thus wereset in motion the agency proceedingsthat ultimately culminated, in 1978, inthe Supreme Court’s decision inVermont Yankee Nuclear Power Corporationv.Natural Resources Defense Council,435U.S. 519 (1978).There, the Courtinstructed federal judges that, except inextremely rare circumstances, theyshould not embellish on the informalrulemaking procedures contained in theAdministrative Procedure Act (APA)and codified at 5 U.S.C.§ 553.

Vermont Yankee’s rejection of judicialprocedural impositions was an importantmilestone in the development of judicialreview of agency action.Lower courtscontinued to impose procedural require-ments on agencies,but as a result ofVermont Yankee, they have done so byrooting their procedural demands(however implausibly) in the text of §553,and some procedural impositionssuch as cross-examination were clearlyplaced out-of-bounds.Perhaps moreimportantly,Vermont Yankee reinforced atrend towards more searching substantive

scrutiny of agency decisionmaking,withsignificant ramifications for the way inwhich agencies approach rulemaking.

So far, this is a familiar tale.What is lessfamiliar, and only apparent from exami-nation of Justice Marshall’s papers at theLibrary of Congress, is the story of howclose we came to not having the VermontYankee decision at all.

The Familiar Tale of Vermont Yankee

The roots of Vermont Yankee lie in theenvironmental movement and thechanging nature of the administrativestate.With the Atomic Energy Act of1954, the federal government embarkedon a policy of fostering commercial usesof nuclear power, but it was only in the1960s that significant numbers ofcommercial plants began to be built.Bythe early 1970s, the problems involvedin dealing with the wastes generated bynuclear power–in particular, the highlyradioactive elements contained in spentnuclear fuel, some of which retain theirtoxicity for up to millions of years–were gaining public attention.Indeed, commercial use of nuclearpower generally was becoming increasingly contentious.

As the number of licenses issued andpublic concerns about nuclear powerincreased,environmental and citizengroups started to intervene in AEClicensing proceedings to oppose newplants, and they began raising nuclearwaste concerns as part of their argu-ments.Only one environmental grouphad sought to intervene in the hearingthe AEC held on Vermont Yankee’s appli-cation for a construction permit in 1967.But, as a sign of the changing climate fornuclear power, seven such organizationsintervened when Vermont Yankee’ssubsequently applied for an operatinglicense for the plant in 1969.Relying on

the newly-enacted National Environ-mental Policy Act of 1969 (NEPA), theintervenors’main argument was that theenvironmental effects associated with the“back end”of the nuclear fuel cycle–thetransportation, reprocessing,and storageof spent fuel from a plant–had to beconsidered in determining whether toaward Vermont Yankee’s license.

The AEC rejected the intervenors’challenge in the VermontYankee hearing,but shortly thereafter it proposed issuinga rule on the question of whether–andhow–environmental effects of thenuclear fuel cycle should be consideredin individual reactor proceedings.Eventhough not required to do so by ‘ 553,the AEC held a two-day hearing on thefuel cycle rule at which interestedpersons could submit oral or writtentestimony,but were not allowed toengage in discovery or cross-examina-tion.Ultimately, the AEC decided thatthe appropriate approach was for theAEC’s regulatory staff to include in itsenvironmental impact statements certainpreset values for environmental effectsassociated with different stages of the fuelcycle.However,AEC concluded that theonly environmental effect associatedwith long-term waste storage anddisposal was the commitment of land fora storage facility, and thus assigned novalue to reflect potential release ofradioactivity from these activities.

The rule then came before the D.C.Circuit.At the time,a debate reigned onthat court regarding the appropriate judi-cial response to burgeoning federalregulation.The main protagonists in thisdebate were Chief Judge David Bazelonand Judge Harold Leventhal.On manyissues, the two were in accord;bothaccepted the need for enhanced judicialscrutiny of agency decisionmaking andfor expansive readings of the APA’s

* Associate Professor.,Columbia Law School.This article is a much-shortened version of mychapter on Vermont Yankee in AdministrativeLaw Stories, a collection of essays FoundationPress will have published by the time you readthis, edited by my colleague and formerSection Chair Peter Strauss.The Marshallpapers, as well as those of Justice Blackmun,have permitted similarly revealing stories to betold about a number of major administrativelaw decisions. continued on next page


requirements for informal rulemaking.Where they disagreed was over whetherthe courts should impose proceduralrequirements on rulemaking beyondthose listed in the APA or required byother statutes, agency regulations,or dueprocess.Bazelon advocated such judicialprocedural impositions,believing thatcourts were not competent to address themerits of the complex technologicalissues often involved,while Leventhalcontended that courts should limitthemselves to rigorous substantivescrutiny of agency decisionmaking.

This debate was evident in the D.CCircuit’s review of the fuel cycle rule. Inan opinion by Bazelon, that courtconcluded that the AEC had failed to“thorough[ly] ventilat[e]” the issues oflong-term storage and reprocessing ofnuclear waste, and remanded the rule tothe agency.The question left hanging wasprecisely where the court thought theNRC had gone astray.Was it the failureto allow cross-examination,discovery,orother procedures that Bazelon suggestedwould have provided an opportunity forsuch ventilation? Or was it instead theagency’s failure to produce a record thatdemonstrated such ventilation,howeverobtained–the view of Judge Tamm,whoconcurred in the result? The opinion is amasterpiece of obfuscation on this point.

This confusion over the basis for theD.C.Circuit’s ruling did not,however,prevent the Supreme Court from grant-ing review and soundly reversing in aunanimous decision written by then-Justice Rehnquist.Acknowledging that“the matter is not entirely free fromdoubt,” the Court read the D.C.Circuitas invalidating the fuel cycle rule becauseof procedural deficiencies. It proceededto sternly rebuke the lower court forsuggesting that the AEC faced proce-dural requirements in the fuel cyclerulemaking beyond those contained inthe text of the APA:“[T]his much isabsolutely clear.Absent constitutionalconstraints or extremely compellingcircumstances the administrative agenciesshould be free to fashion their own rulesof procedure and to pursue methods ofinquiry capable of permitting them todischarge their multitudinous duties.” 1

Nonetheless, the Supreme Court ulti-mately remanded rather than reversing

the D.C.Circuit outright, to allow that court to determine whether the admin-istrative record was substantivelyadequate to support the fuel cycle rule.

The Hidden Story of Vermont Yankee

That the Court rebuffed Bazelon’sproceduralist approach was not much ofa surprise.The Court’s precedent allow-ing agencies to forego formaladjudicatory or formal rulemakingprocedures,even in contexts where it wasoriginally expected formal procedureswould be used,presaged this result.Sodid the Court’s decisions upholding anagency’s broad discretion to control itsmode of procedure in the absence ofstatutory (or constitutional) mandates.Vermont Yankee was also an early exemplarof the Court’s move towards formalismstatutory construction and away frommore open-ended judicial developmentof administrative law,a trend whichbecame more prevalent in subsequentdecades in response to growing opposi-tion to judicial policymaking.

What was surprising about VermontYankee,however,was the unanimity withwhich the Court spoke. Joining theCourt’s decision without reservationwere Justices Brennan and Marshall,hardly thought of as opponents of judi-cial activism.While the animositybetween Chief Justice Burger and JudgeBazelon was well-known, JusticesBrennan and Marshall were good friendswith Bazelon; indeed, Justice Brennanwas a regular at the lunches Bazelonorganized at Milton Kronheim’s liquorwarehouse.Particularly given that theCourt ended up remanding rather thanreversing the D.C.Circuit and that NRCwas committed to revising the fuel cyclerule regardless of the Court’s decision, itseems odd that none of the Justiceswhoparticipated in the case at least chalenged the Court’s decision to reach the merits.

Review of Justice Marshall’s papers atthe Library of Congress reveals,however,that they did. Justice Brennan led thecharge,quickly drafting an opinion thatwould dismiss the grant of certiorari asimprovidently granted (or DIG, in theCourt’s parlance) once it became appar-ent after oral argument and supplementalbriefing that the NRC intended to goforward with a new rulemaking.Like theCourt’s published opinion, JusticeBrennan’s draft stated that the Court ofAppeals had erred “[i]f the Court ofAppeals had decided that NEPA requiresprocedures in rulemaking in excess ofthose expressly required by the [APA]”and that the occasions for judicial impo-sition of hybrid rulemaking proceduresare “severely limited.”However, JusticeBrennan was far more generous in hisreading of the D.C.Circuit’s opinion,rejecting the procedural interpretationadvocated by Vermont Yankee and theNRC:“Instead,we understand theCourt of Appeals to have held only thatthe original spent fuel rule was inade-quately supported by the rulemakingrecord.”And review of this factbounddetermination–unlikely to warrantSupreme Court consideration in anyevent–was particularly inappropriategiven that the NRC was committed torevising the rule.2

Justice Brennan’s efforts provedunavailing. In a responding memoran-dum,Justice Rehnquist made clear hewould dissent from any effort to dismissthe grant of certiorari, stressing thecontinuing impact of the D.C.Circuit’sdecision on the licenses of the two plantsinvolved and reactor licensing generally.His views carried the day with ChiefJustice Burger, Justice White and JusticeStevens, so that in the end four of theseven justices who heard the case votedagainst dismissal.After unsuccessfullyturning his renowned powers of persua-sion to tempering the tone of JusticeRehnquist’s proposed draft, JusticeBrennan ultimately acknowledgeddefeat, remarking to Justice Rehnquist:“[Y]ou are a damned good fisherman.Indeed, so good that I now give up thesporting fight and ‘acquiesce’ in yourcatch in these cases.”3

1 435 U.S. 519, 540-41, 543 (1978).2 See Brennan First Printed Draft at 8-9 (Feb. 17, 1978), Vermont Yankee Nuclear PowerCorp. v. NRDC, 435 U.S. 519 (1978) (on filewith the Library of Congress, ManuscriptRoom, Papers of Justice Thurgood Marshall(Box 201)).3 See Memorandum from Justice Brennan toJustice Rehnquist, (Feb. 28, 1978), id.

Discovery: In early 2005, the USDepartment of Labor cites Indiana’sUnemployment Insurance (UI)appeals backlog as the worst in thenation.The backlog is approximately5,500 appeals.

Action Taken: IDWD has entered intoan agreement with Indiana Univer-sity Law School, in which tenuredlaw students receive credit for servingas non-paid intern AdministrativeLaw Judges (ALJs).Beginning in mid-May, the use of ten full-time studentALJs reduced the backlog to 2,200cases and saved the state governmentover $ 250,000.In addition the UIReview Board appeals backlog hasbeen entirely eliminated.1

Collaboration between two IndianaUniversity law schools and theIndiana Department of Workforce

Development (IDWD) has introducednew dimensions in education and effi-ciency in the realm of executive branchadjudication. In May 2005, ten lawstudents began work as AdministrativeLaw Judges as a part of their formal legaleducation. Since then, student ALJs havedevoted over 3,500 hours to conductingunemployment insurance (UI) benefitappeals and rendering decisions basedon those hearings.

Part I of this article describes the legaland logistical landscapes permitting lawstudents to preside as student ALJs forIDWD.Part II describes the training,adjudication,and learning experiencesarising from Indiana’s student ALJ initia-tive.Part III suggests considerations forlaw schools and state administrativeagencies interested in developing similarstudent ALJ initiatives.

I. Legal and LogisticalLandscape

Can a law student serve as an unpaidadministrative law judge? For the IDWDinitiative, federal law, state law,and policyconsiderations coalesced for a resounding“yes.” The resulting collaborationprovides a unique learning opportunityfor law students and has introduced newefficiencies into the UI hearing process at IDWD.

The IDWD,like similar state agenciesaround the country, runs its unemploy-ment insurance appellate process underthe oversight of the U.S.Department ofLabor.The Social Security Act providesfor payments to the states to assist in theadministration of their unemploymentcompensation laws if the Secretary ofLabor certifies that certain conditionshave been met.2These include mandatesthat the administration of the appellateprocesses be “reasonably calculated toinsure full payment of unemploymentcompensation when due and that appel-late process for individuals whose claimsare denied include an “[o]pportunity for afair hearing,before an impartial tribunal.”3

The Handbook for Measuring Unem-ployment Insurance Lower AuthorityAppeals Quality sets the criteria for statesto obtain the Secretary of Labor’s certifi-cation.The criteria are silent regardingthe qualifications of the hearing officersfor unemployment insurance appeals.The IDWD checked with the U.S.Department of Labor and the Depart-

ment’s Region 5 administrator concern-ing the use of student ALJs.Neitheroffice voiced objection to Indiana’sstudent ALJ pilot program.

At the state level, Indiana law requiresthat IDWD administrative law judges be“full-time salaried employees.”4

However, the same law indicates that theunemployment insurance board mayauthorize employment of part timeadministrative law judges for limitedperiods.Based on this statutory law, theprospective supervising attorneys andjudges for the student ALJ pilot programobtained the unemployment insuranceboard’s authorization to host up totwenty law student ALJs.

II. Training, Doing, and LearningThe student ALJ initiative focuses on

three factors: intensive student ALJ train-ing, the effectiveness and efficiency of thestudents’administrative adjudicationwork,and students’experiential andsubstantive learning.

A. Student ALJ Selectionand Training

Considering applicants from the twoparticipating law schools, IDWD selectsprospective student ALJs based onprofessionalism, leadership skills, andacademic achievement.An intensive,forty hour training program precededthe students’ALJ work last summer.A pared down twenty hour trainingprogram, integrated into the students’full academic schedules,was tried in the fall semester.Feedback from allinvolved indicates that the forty hourtraining in conjunction with a full-timesummer effort for the student ALJsaccomplished more than the abbreviatedfall training.Consequently, the studentALJ initiative will be suspended in theSpring of 2006 and only the summerprogram will continue.


Student Administrative Law Judges: NewDimensions in Education and Efficiency

By Cynthia Baker* and James M.Davis**

* Clinical Associate Professor of Law andDirector,Program on Law and State Government, Indiana University School ofLaw – Indianapolis.** Student ALJ, J.D. candidate, 2007, IndianaUniversity School of Law – Bloomington.1 Indiana State Government’s PerformanceReport, 57 (August 19, 2005), also available athttp://www.in.gov/gov/media/Perfor-mance_Report-Final.pdf (last visitedOctober 19, 2005).2 42 U.S.C. § 302(a), 42 U.S.C. § 303(a)-(b).3 42 U.S.C. § 303(a)(1).4 Ind. Code 2-4-17-4(a). continued on next page


The forty hour training opens with areview of two full UI administrativeappellate opinions to explore the length,writing style, and traditional format ofIDWD administrative opinions.Substan-tive review encompasses Evidence,Administrative Law,Indiana’s Adminis-trative Orders and Procedures Act, and areview of current, applicable Indiana caselaw.Additional training sessions includehow to conduct an unemploymentinsurance appeals hearing and how theadministrative appeals process fits into theSocial Security system.

A series of mock hearings serves asthe centerpiece of the training andculminates with the students taking theALJ roles.Current ALJs and programleaders critique each participant as to:the neutral’s role, substantive law,dealing with belligerent disputants,and lawyer preparedness.

The students also meet with currentALJs,observe two or three actual hear-ings, and interact with other employeesof the Department.Written materials—

reference guides, templates for decisions,and scripts for conducting hearings—supplement the training.

B. Doing Since its inception, the initiative has

enabled each summer student ALJ toconduct over one-hundred and fiftyhearings and craft nearly as many deci-sions.While, the law students’adjudicative work necessarily involvesreview and critique by permanent ALJs,it also presents opportunities to test tech-nologies, and unique docketmanagement systems.

During the first week of actual hear-ings, the student ALJs meet as a groupwith program leaders after each case.Thistime for feedback and reflection givesstudent ALJs the opportunity to askquestions,clarify and discuss the topicsand procedures covered in training,andto consider their forthcoming judicialopinions.Following the group meeting,student ALJs write their decisions andsubmit them to the team leaders,whocritique and return them to the students

for final revision.After the first week,meetings are generally held on an as-needed basis. In addition, IDWD’s ChiefALJ Robert Robisch reviews and signsevery student ALJ opinion.NeitherJudge Robish nor the team leadersinstruct the student ALJs how to rule inany particular case.

The student initiative allows theagency to experiment with new tech-nologies.For example,prior to thestudent ALJ initiative, IDWD ALJscomplied with Indiana law requiring thatUI appeals hearings be “recorded andplaced into the record”by recordingeach hearing on cassette tapes.Thiscumbersome system was difficult to use,required hearings to be interrupted,andcreated very thick case files.With theinflux of student ALJs, the agency imple-mented a digital recording systemallowing the student ALJs to continu-ously record their hearings,downloadthe recording onto their computers, andduplicate the hearing onto a CD forfiling.The test proved a great success andresulted in more available storage space,cost savings, and the ability to providethe Review Board (and the public)with electronic audio copies of UIappeals hearings.

The student initiative also provided anopportunity to implement a new docketmanagement system for UI appeals.Forexample,prior to the student ALJ initia-tive,UI appeals hearings were assigned toa particular ALJ for a particular time.When a party failed to appear,whichhappened approximately 25% of thetime, the case would be dismissed andthe ALJ would not have a hearing untilthe next scheduled hearing.Under thepanel system used by the student ALJs,twelve to fourteen cases are called for aparticular time period.The ten studentALJs then choose a case and call theparties. In the event a appealing partyfails to appear, the student ALJdismisses the case and calls another.This panel system allows more cases tobe handled each day and ultimatelyreduces the time between filing a UIappeal and the scheduled appearance forthe appeal hearing.

C. Learning The student ALJ initiative provides an

excellent vehicle for learning about law,

Student ALJs at Indiana’s DWD and Indiana’s Governor,Mitch Daniels, Summer 2005Front row:Michael Hult, James Davis,Brian Bobb; 2nd row:Andrija Samardzich,Brandee Chanin, IndianaGovernor Mitch Daniels, Jennifer Winton-Denniston, Jay Bhat; 3rd row:Dan Adams,Levi Harris (notpictured:Doug Skelley). James Davis, front row, center, is the co-author of the article.


lawyering,and governance.One formerstudent ALJ remarked,“No other summer experience could have better prepared me for a career in law.”Anotherstudent ALJ said,“The most valuable partof the experience was the opportunity towatch other lawyers practicing.Each daydifferent lawyers came to my office andpresented their cases in front of me. Itwas invaluable.”

In Indiana UI appeals hearings, theALJ as fact finder asks the questions ofboth parties.As a result, the UI appealshearings present student ALJs with manypractice and training opportunities toquestion witnesses about the facts of acase.Student ALJs quickly learn how toask appropriate questions,how to limitthe party’s answers to what is asked,whattypes of questions will elicit the responsesthey need,what questions to ask tobolster or challenge witness credibility,what questions to ask to elicit particularfacts, and,perhaps most importantly,whatquestions to avoid.

Student ALJs learn organizationalskills, time management, and how towrite judicial decisions in a concise and timely manner.Writing three to fourdecisions every day, student ALJs leavetheir experience knowing how to writecrisp,concise, and focused legal prose.The environment of student camaraderie and enthusiasm also providedinherent rewards for students’use ofeffective organizational and timemanagement skills.

The IDWD student ALJ initiative alsogives the law students opportunities tomeet leaders and lawyers within otherstate agencies,departments, and branchesof Indiana’s state government.One high-light of the summer program included anopportunity for the student ALJs to meetIndiana’s Governor Mitch Daniels.TheGovernor led a roundtable discussionabout the program, the selection process,and the value of the students’work to thecitizens of Indiana.Students find theyhave become a part of the valuablenetwork of the legal community withinstate government.

Standing alone, the opportunity for alaw student to serve as an ALJ offersmuch in the way of experiential learn-ing—applying legal concepts taught indoctrinal courses of law school,profes-sionalism,and the legal system in whichthose future lawyers will work.However,in the context of the multitude of deeplearning experiences attenuated to thestudent ALJ work, the learning opportu-nities expand beyond the students’adjudicative role.Learning from thelawyers before them, learning to work“on stage” in a professional setting,andlearning about law as a part of a largercontext of government policy and designalso inform and educate law students in ameaningful way.

III. Advice for Those ConsideringSimilar Initiatives

While this collaborative effort providesexcellent learning opportunities forstudents and reduced costs of administra-tive adjudication work for stategovernment, all involved should bemindful of the impact of such collabora-tion on administrative justice.That is,how fair, fast, and how cheap should anexecutive judiciary be?5The answers tothat question will inevitably have differ-ent contours for different state agencies,different areas of administrative law,anddifferent law schools.For those interestedin exploring implementation of studentALJ initiatives,some considerations follow:

A.Agency Considerations • Before contacting law schools, agen-

cies should confirm that no legal orpersonnel authority precludes creatinga student ALJ initiative and obtainapproval for the proposed initiativefrom,or, at least,begin the approvalprocess before, the governing adminis-trative board.

• Agencies should ensure that theproposed student ALJ initiativecomports with applicable code of judi-cial conduct for the state’sadministrative law judges.

• Agency leadership, legal counsel, andALJs should be prepared to developtraining for the incoming student ALJsthat will include substantive law, skillstraining, simulated hearings, and shad-

owing actual hearings.The IDWDexperience indicates that an interac-tive, forty hour training with ten ormore law students provides a qualitydynamic for substantive training andteam building.

• Agencies should carefully considerlogistical ramifications of invitingstudent ALJs to the executive branchjudiciary.Hearing space,office space,computers,printers, administrativesupport,docket control,parking, secu-rity all raise issues worth planning forbefore the law students arrive for theirfirst day of training.

• Agencies should consider the studentqualifications for accepting studentALJs into the program.Do the agen-cies want students who havecompleted a particular course (e.g.,administrative law), a certain numberof credit hours toward their lawdegree,only students who haveobtained certification to practice lawunder the state’s student practice rule,or some other qualification?

• Prospective supervising ALJs shouldunderstand the scope and nature ofany additional responsibilities inadvance of the students’arrival to the agency.

• Agencies should prepare for frank andfull discussions between agency leader-ship and the professional ALJsconcerning professionalism andmorale issues in connection with theidea of bringing on law students asunpaid ALJs to contribute to the adju-dicative workload facing the agency.

• Finally, the agency and its executivejudiciary may want to consider howsuch a pilot student ALJ project could play a role in improving law, thelegal system,or the administration ofjustice.For example, a student ALJinitiative could inform discussionsregarding funding methods for admin-istrative adjudication,central panels ofadministrative law judges, sharedneutral programs,public policy mediation,or centralized offices ofdispute resolution.

B. Law School Considerations • A law school considering participation

in a student ALJ opportunity for its law5 See John M.Greacen,How Fair, Fast, andCheap Should Courts Be?, 82 JUDICA-TURE 287 (1999). continued on next page


students will have to consider whetherthe law school will permit its lawstudents to earn law school credit forthe proposed experience.ApplicableABA standards point to considerationof the goals and the methods of theproposed student ALJ experience,how the students’work will be evalu-ated,and how opportunity forreflection on the students’ALJ workwill be afforded.

• Possibilities for incorporating thisexperience into a law school curricu-lum include offering the student ALJopportunity as a part of an existingclinical externship course, as a separate clinical course, or as a clinicalexperience in conjunction with adoctrinal course (e.g., administrativelaw, employment law, jurisprudence,labor law).

• If offered through the clinicalcurriculum, the law school shouldconsider issues of professional respon-sibility and conflict of interest withother clinical opportunities availablethrough the law school’s clinic.

• Prospective faculty advisors for thisopportunity should consider takingthis opportunity to introduce toparticipating student ALJs the ModelCode of Judicial Conduct for StateAdministrative Law Judges.The

canons of the Model Code provide astarting point for exploring issues ofadministrative adjudication that maybe beyond the purview of an admin-istrative law course or an establishedexternship course. Such rules mayprovide appropriate language to begin conversations about executivebranch adjudication and the adminis-tration of justice.

• If law school credit will not beawarded to students participating as student ALJs, law schools could consider promoting studentALJ opportunities through theschools’ respective offices of professional development.

IV. Conclusion Offering law students an opportunity

to learn to be lawyers through adjudica-tive experience promises rich rewards interms of teaching how the law works todeliver justice to the citizens seeking itwithin the modern administrative state.In Indiana, the student ALJ initiative hasbegun a new dialog between the stategovernment and the legal academy.The resulting conversations haveencompassed the art of adjudication, theshape of dispute resolution, and ques-tions of government design.Using the IDWD experience as a model, state

agencies and law schools have an oppor-tunity to explore new dimensions ofefficiency and education in mutuallybeneficial ways.

From every perspective, the studentALJ experience at Indiana’s Departmentof Workforce Development has bornefruit.“I couldn’t imagine a better expe-rience to bring all that I have learned inlaw school together,” said one student.“The law students have done greatwork, a lot of work,” says Chief Unem-ployment Insurance Administrative LawJudge Robert Robisch.“This has beenan amazing teaching opportunity,” saysAdministrative Law Professor EleanorKinney.The Indiana student ALJ expe-rience stands as example of the greatrewards that can be gained throughinnovative collaboration between stategovernments and law schools.

State governments and law schoolsconsidering student ALJ initiativesshould carefully consider the legal,governmental, and curricular ramifica-tions of allowing students to do thework of administrative law judges as apart of the law students’ formal legaleducation.Doing so will pave theway for engaged,mutually beneficial,efforts toward delivering administrativejustice in a fair, professional, and efficient manner.

The incidents last year in which millions of credit card accounts were compromised by breaches of computersystems at data companies highlights the growing threat of identity theft.This ABA-CLE teleconferencefocuses on how identity theft affects individuals and businesses, how to patch up personal finances after an

identity theft and ways to deal with the perpetrators.Actions now being taken against companies that maintain dataafter breaches occur will also be discussed.

The program is sponsored by the ABA Journal, Membership and Marketing, and the Center for Continuing LegalEducation and cosponsored by the Section of Administrative Law and Regulatory Practice.

CLE credit has been applied for in states that accept the teleconference format.To register, call the ABA at800/285-2221 from 8:30 a.m. to 6:30 p.m. Eastern weekdays, beginning Monday, February 20th or register onlineby Friday, March 10th www.abanet.org/CLE/connection.html.There is a nonrefundable $9.75 phone linecharge for the teleconference. If you are unable to participate in the live teleconference, the program is available, atno cost, for one month, on the ABA CLE Web Site at http://www.abanet.org/CLE/connection.html. CD’s of the program are available to ABA members for $50.00 two weeks after the program.To order a CD call the ABAService Center at 1-800-285-2221.

On March 15, 2006 at 1:00 pm Eastern, the ABA

Connection is presenting a one-hour CLE teleconfer-

ence titled, “The Identity Theft Crime Wave.”

ABA CONNECTIONThe Identity Theft Crime Wave


2005 has proven to be a standout,perhaps pivotal,year forAdministrative Law.The failure of government at all levels toadequately cope with Hurricane Katrina, the ongoing anti-terrorism debate over national security vs. civil liberties, and theSupreme Court decisions in Kelo and Raich — the first equatingeconomic development with “public purpose”under theTakings Clause and the second embracing home-grown medic-inal marijuana as a commodity subject to federal regulationunder the Commerce Clause — have fueled widespreadpopular reevaluation of the government’s role in delivering basicservices while protecting the public and preserving democracy.The life-altering events of 2005 have similarly sparked a reex-amination of the methods government may employ duringtimes of duress.

Considering the domination of these issues in the popularand legal press, it is no wonder that the 2005 Administrative LawConference produced the usual strong turnout for the Section’sflagship meeting.

Contributing to the Conference’s success were the diverserange and large number of programs fielded by Conference Co-Chairs Sharan Levine and Kathleen Kunzer, the unflaggingefforts of Section Staff Director Kim Knight, and Conferenceco-sponsors:Foley & Lardner LLP;Haynes & Boone LLP;PaulHastings Janofsky & Walker LLP;Ropes & Gray LLP;SidleyAustin Brown & Wood LLP;Wiley Rein & Fielding LLP;andWilmer Hale LLP.

Following are condensed versions of the keynote remarks ofJohn D.Graham,Ph.D.,Administrator,Office of Informationand Regulatory Affairs, and remarks of Morton Rosenberg ofthe American Law Division,Congressional Research Service, inacceptance of the 2005 Mary C.Lawton Award for OutstandingGovernment Service. [Ed.Note:A condensed version of thewinning paper for the 2004 Award for Scholarship in Adminis-trative Law,Agency Choice of Policymaking Form,71 U.CHI. L.REV. 1383 (2004),by M.Elizabeth Magill, John V.Ray Research

Professor,University of Virginia School of Law,appeared in theFall 2004 issue of the News.ADMIN.& REG.LAW NEWS,Vol.30,No.1,at 15.]

John D. Graham: The “Smart Regulation” Agenda:Progress and Challenges

My topic today is the Bush Administration’s “smart-regulation”agenda.The good news is that we are improving the economicefficiency of major rulemakings.The bad news is that we are nowfacing a series of new challenges in regulatory policy that aremore difficult than what we have faced in the past.

The “Soft” Benefit-Cost TestOur role at OIRA is to review new rulemakings and stimu-

late modernization of existing rules.We do our regulatoryoversight with a team of about 30 career OIRA analysts whoapply what I call a “soft”benefit-cost test.We ask whether thequantified benefits of a rule exceed the quantified costs but wealso strive to be sensitive to important “intangible”considera-tions.These unquantified factors may reflect basic issues offairness, such as civil rights,or they may reflect a key efficiencyconcern that cannot yet be fully measured and expressed inmonetary units (e.g.,homeland security).Considering bothmatters of efficiency and fairness,we ask whether the benefits ofa rule justify its costs.

Regulatory Benefits and Costs in the USA, 1981-2005

Since OIRA was created in 1981,we have assembled agencyestimates of the costs and benefits of major rules. In our 2005Report to Congress,we reviewed what is known about trendsin major rule activity at the Cabinet agencies (e.g.,Labor, Inte-rior,Transportation,Treasury,Health and Human Services,Housing and Homeland Security) and EPA (excluding theindependent agencies).Counting only the rules for which wehave cost estimates,we found that about 190 major rules of thistype have been adopted since 1981, resulting in a $117 billionprojected burden on the American people.These new regula-tory burdens were added to the pre-existing burden of severalhundred billion dollars per year.

The good news is that the average annualized cost of majorrulemakings has declined by 70% during this Administration(2001-2004) compared to the annualized figures for the previ-ous 20 years.The [other] good news is that annual net-benefitsfrom major rulemakings appear to have roughly doubled duringthis Administration. In fact, if you compare major-rule activityfor the past three Administrations,you will see that the averagecosts of major rules were highest under Bush 41 (1989-1992),considerably higher than the Clinton years (1993-2000).

2005 AdministrativeLaw Conference

Former Section Chair Peter Strauss and current Section Chair Eleanor Kinneyconfer with OIRA Administrator John Graham (center). All photos in this articlefurnished by Kim Knight.



Explanations for ProgressMy career staff inform me that the explanation for our

performance is straightforward:we are issuing fewer major rulesthan previous Administrations but those we are issuing tend tohave a stronger benefit-cost rationale than has been true histor-ically.Moreover,by approving — indeed,by encouraging — asmall number of highly beneficial rulemakings, this Administra-tion has established a strong record of net benefits.

Progress has been made without doing anything fancy.Wedid not seek and have not received any new authority fromCongress to reform regulations.Nor have we issued a newexecutive order and, in fact,we have simply implemented the requirements of President Clinton’s 1993 executive order on regulatory planning.We have done five things differently, [however].

First: We have done our work more openly.

We have an open-door policy at OMB for peoplewho care about rules and have an analytic case tomake to us.On a daily basis,you can track thesemeetings on OMB’s web site, including basic data onthe rule being discussed and the names and affilia-tions of the participants.We also invite the affectedagencies to join these meetings.We do not discloseminutes of our discussions because we want peopleto be able to speak candidly about their concerns.

Second: We have buttressed our staffing in science andengineering.

Historically,OIRA staff have had strong backgroundsin economics, statistics and policy analysis.However,the nature of federal regulation has changed since wewere created in 1981.Most classic economic regula-tion has been rescinded or moved into independentagencies.The growth area has been public health,

safety and environmental regulation,or what I callscience-based regulation. In order to respond to thistrend,our latest hires at OIRA have been in fieldssuch as environmental science,engineering andepidemiology. Indeed,OIRA’s first hire in toxicologyhas been among our busiest staffers over the past fouryears.Although these handful of new staff may seemmodest, they have substantially improved our abilityto ask tough questions of regulators.

Third: We have raised our analytic expectations of agencies.

In an admittedly obscure but readable documentcalled OMB Circular A-4,we have written down —in less than 50 pages — what we expect to see in aregulatory analysis.This guidance document wasdeveloped through an open process that includedpublic comment,expert peer review and formalinteragency review.The changes were importantrefinements,not a revolution.

For example,on time preference for present versusfuture benefits and costs,we expect agencies topresent results using annual discount rates of 3 and 7percent.We no longer insist on 7% as if it is the onlylegitimate perspective,especially when future genera-tions are at risk.Lifesaving gains from rules are to bevalued in the range of $1 million to $10 million perstatistical life saved;we do not pretend to have amore precise answer.Rules projected to have billion-dollar impacts must be accompanied by formal,probabilistic uncertainty analysis.Health and safetyrules also must be accompanied by cost-effectivenessanalysis that accounts for reductions in both mortal-ity and morbidity.We are now working with federalagencies and the Institute of Medicine to definecommon measures of effectiveness that all health andsafety agencies shall use.We have also shined a newspotlight on information quality (IQ). Our newIQ policy says three things to agencies: you musthave minimum information-quality goals,you mustuse peer review before you release official scientificinformation,and you must give the public anopportunity to correct information that has beendisseminated in error.

Fourth: We have chosen our OMB priorities carefully.

We began in 2001 by reviving the dreaded “returnletter.” In the first six months on the job, I issuedover 20 return letters to agencies, suggesting thatspecific rulemaking proposals need to be reconsid-ered.You can read these letters on OMB’s web site.

Section Chair Eleanor Kinney presents Mary C.Lawton Award to Morton Rosenberg.



This rate of return,while modest,was more than thetotal number of return letters in eight years of theClinton Administration.Four years later,we find thatwe rarely need to issue a return letter.Agencies workwith us to fix problems or they persuade us that thereis no problem to fix.We also invented a new toolcalled the “prompt” letter.This is a public letter to anagency suggesting that they should consider adoptinga new regulation.We have issued roughly a dozensuch letters.Through prompt letters and more infor-mal mechanisms,we believe we can save more livesin a cost-effective manner.Making new rules smarteris one thing;making sense of the sea of existing rulesis a more humbling challenge. In 2001 and 2002 weused a public- nomination process to identify about100 rules that agencies are now reforming. In 2004we launched a more targeted effort to streamlinerules impacting the manufacturing sector of the USeconomy;about 76 such rules have been targeted byagencies for reform.

Fifth: We have not been reluctant to take risks —even take “hits”— when our technical case isstrong and the stakes are significant.

[For example,] in 2001 our House appropriationssubcommittee informed us that we should considerrescinding a Clinton-era executive order.This orderrequired many organizations in society — actually,any receiving federal funds — to provide foreignlanguage assistance to people living in this countrywho have a different native tongue and do not speakEnglish effectively.We re-examined this order but didnot find the case for repeal to be compelling.Need-less to say,our position led to a persistent stream ofcriticism from the “English-first”advocates and theirallies in Congress.

In 2002 we worked with EPA on a rule that irkedseveral large businesses that supply diesel engines foruse by heavy truck makers.The rule imposed non-compliance penalties on companies that chose todelay their compliance with a rule to cut dieselexhaust from new heavy trucks.We saw this rule asan important signal for technology innovators, sincethere were companies that were risking investmentcapital on cleaner engines that would be imple-mented on schedule. In an unusual twist,we foundourselves helping defend EPA against a barrage of[industry] complaints.

In 2003 we worked with EPA on another rule toreduce mercury emissions from coal plants by 70%.

Unlike the plant-by-plant rules preferred by manyenvironmental groups, EPA designed an innovativecap-and-trade rule,one of the first ever issued for aso-called “hazardous”air pollutant.We believe EPAmade a strong case that cap-and-trade would likelydo more to reduce localized “hot spots” than theuniform technology requirement that the greenswere advocating.After many months of rhetoricalattack from the greens,we are pleased that EPArecently won a key vote in the Senate against disap-proval of the rule.

More Difficult Challenges RemainWithout question we face a huge task on the issues of home-

land security and disaster response.9/11 and Katrina haverevealed weaknesses in many aspects of our society, and thatincludes the way we do regulatory analysis.Homeland securityregulations account for about half of our major-rule costs in2004 but we do not yet have a feasible way to fully quantify benefits.

A moment’s reflection will reveal some of the perplexingissues:How do we identify targets of potential terrorist attacks,the probability of attacks and associated damages, and the effec-tiveness of various countermeasures in reducing risk? Given thatsuch information would be of obvious use to terrorists,howshould we respect the need for secrecy with the need to justifyto the public the burdens of the rules we are imposing? My ownview is that we are still at the beginning of a decade-long effortto build a rigorous homeland security rulemaking process. Iadmire the people at the Department of Homeland Securitywho are tackling this huge challenge.

On disaster response, the experience with Katrina has raised important questions about how the federal government should

Section Chair Eleanor Kinney presents Scholarship Award to M.Elizabeth Magill.



evaluate low-probability,high-consequence events.Should these events beevaluated based onexpected damages, orshould a risk premium beadded to reflect thepublic’s risk aversion? Aswe learn more about whatactually happened in theGulf Coast and whatmeasures might havemade a difference, weneed to feed that knowl-edge back into improvedanalytic systems for antici-pating and responding tofuture disasters.

The Need to Validate Regulatory AnalysisGiven the more important role played by benefit and cost

information,we need to learn more about the validity of benefitand cost estimates made by agencies before a regulation ispromulgated.There is a small but growing body of literaturecomparing these projected benefits and costs and to what wasactually experienced after rules took effect.What we are findingis that agencies tend to overestimate both the costs and benefitsof rules, though the errors seem to be larger on the benefit side.

Cooperation with EU RegulatorsSince US and European rules tend to have a huge influence

around the world, it is especially important that we accomplishcooperation with the EU.Our track record is very mixed.After years of unsuccessful dialogue,we have sued the EU in theWorld Trade Organization because we believe that their regula-tors,without any scientific justification,have blocked access tobioengineered seeds pioneered in the United States. Mean-while, the EU has repeatedly expressed concern to us that thenew Sarbanes-Oxley legislation — and associated SEC rules —have imposed unintended costs on European-based firmsseeking to do business in the United States.

Our inability to find common ground with the EU hasbecome comical.The two sides of the Atlantic cannot evenagree on the proper design of crash dummies for use in automo-bile crash tests.That means that vehicle manufacturers doingbusiness both here and in Europe face the prospect of undertak-ing separate crash tests usingAmerican and European dummies.And can you believe this: the European dummy wears safetybelts in crash tests; the American dummy does not.

Let me conclude on a positive note.The quality of dialoguebetween the European Union and the Bush Administration is

improving on a wide range of issues.At OMB,we recentlyhosted a three-day visit by twelve senior career officials from theEuropean Commission.We compared notes on how our regula-tory systems are evolving and how we do regulatory analysis. Iwas amazed at how serious the EC has become about regulatoryreform.We agree that better regulation is a key to more jobs andprosperity.We are determined to make more tangible progresson the challenge of regulatory cooperation,because we see jointgains for both the American and European economies.

Morton Rosenberg Remarks on Receiving the Mary C. Lawton Award

I am deeply honored by the award you are bestowing on metoday.That I am the first legislative branch attorney to receivethis Award has become a source of pride in the CongressionalResearch Service (CRS) generally, and in the American LawDivision in particular, and also amongst the legal professionalson congressional committees and in congressional supportagencies.There is a sense that the ABA has recognized thatlegislative attorneys do different but real legal work.

I cannot imagine another law job, in or out of government,that could equal the freedom,excitement, responsibility, andsatisfaction my position at CRS has provided me for over threedecades.Where else could I come to work in the morning onthe Metro and read about some emerging issue in the Post that Iwas certain to receive phone calls about that day? Or a place inwhich I would be asked to advise on sensitive matters that eventhe Post or Times had not yet become aware of?

It took me 12 years to find CRS.Early on I decided thattraditional private practice wasn’t for me and at graduate schoolI realized that teaching was okay as an avocation but lacked thepragmatic,problem solving immediacy of real world challenges.But I did meet my life-long partner,Aileen,at graduate schooland started a family, so something good did come of it. Ibounced around four departments and agencies for several years,doing trial and appellate litigation and writing agency appealsopinions in private and public sector labor matters,until I cameacross my invitation to the promised land:a posting for a job inthe Library of Congress that required only a law degree and adesire to serenely contemplate the vagaries and varieties ofconstitutional and statutory law and to share the product ofthose contemplations with Members and Committees ofCongress.At least that’s the way I read it. I tarted myself and myresume up,presented my best lawyer-like self, and got the job. Iinformed my long suffering wife that we were set:no more longhours,no trips,no litigation stress, and lots more money.

And for a week,between December 26,1972 and January 3,1973, that was true.1973 was the year of Watergate, the SaturdayNight Massacre,presidential impoundments, the demise ofOEO,the debacle of L.Patrick Gray as head of the FBI, theresignation of Spiro Agnew, the selection of Gerald Ford as Vice

Former Section Chair and current nomineeas U.S.Ambassador to the European Union(EU),C.Boyden Gray, and current EUAmbassador to the United States, JohnBruton, pause at fall section dinner.



President.These and a myriad of lesser issues were dumped onmy plate with a rapidity that made my head spin.

I produced over 70 memos and reports that year but onestands out because it made me understand the true nature of thework I was doing. It was a Friday afternoon in November, just afew weeks after the Saturday Night Massacre.Nixon desperatelyneeded to install a new,uncontroversial Attorney General afterElliott Richardson’s resignation and the firing of Bill Ruck-elshaus.He picked an obscure Senator from Ohio,WilliamSaxbe,a certainty to pass Senate muster.

The Chief of my Division walked in and dropped a requeston my desk.“The Majority Leader,”he said,“wants to know ifSaxbe is ineligible to be appointed Attorney General under theEmoluments Clause.He wants the answer by Monday after-noon.OK?”Sure I said, and he left.As the door closed my mindwent right to the heart of the crucial questions I was about toconfront:What the heck is the Emoluments Clause and whatam I going to tell Aileen.

By Monday afternoon I had absorbed whatever learningthere was from Farrand, the Federalist Papers,Story’s Commen-taries, several obscure 19th century Attorney General opinions Ihad found,and a 1909 Senate precedent involving PhilanderKnox’s nomination to be Secretary of State. I concluded in a 39page report that Saxbe was disqualified because the pay of theAttorney General had been raised during his tenure as Senatorand that any law that attempted to remedy the disqualificationby lowering the pay violated not only the spirit but the letter ofthe prohibition.

I was very proud of myself, and was particularly happy thatper CRS policy my name appeared prominently as the authorof the report.On Wednesday I picked up the CongressionalRecord to see the results of my efforts and was shocked.TheMajority Leader took the floor and said “I have been thinkingall weekend about the constitutional problems posed by the

Saxbe nomination and this is what I have concluded”and thenproceeded to read my wonderful piece verbatim into theRecord,without attribution.

I was mortified and livid that my first brief opportunity for aplace in the congressional sun had been denied.The elder states-man of the Division in those days took me aside and explainedin his gentle but firm way that I had to understand who weworked for and why.We work for the institution of Congress,they use our products and advice as they wish,and their individ-ual or collective wisdom trumps our individual wisdom andegos every time.

I learned that lesson well and it has guided me ever since. Itis Congress as an institution that we at CRS are working for.From that premise flow the injunctions of objectivity andnonpartisanship that characterize our work. I also believe itencompasses the notion that the constitutional integrity ofCongress, as an institution,must be protected.

As an attorney advising Congress, I have been careful not tounderstate the limits of congressional authority vis-a-vis theexecutive or the courts,but I have been mindful of the need ofmy congressional clients to understand the scope of the institu-tion’s legislative,oversight, and investigative powers and theimportance and necessity for vigilance and consistency in exer-cising those constitutional prerogatives in order to protect andsustain them.Congressional oversight, in particular,must beunderstood as not simply a constitutional prerogative but as aconstitutional duty.The consistent,vigilant and aggressive fulfill-ment of that duty preserves and vindicates that prerogative.ACongress quiescent for an extended period can lead to anunhealthy imbalance in the powers of the political branches. Insuch times the prerogatives may not be irrevocably lost but theymay not be easily retrieved.And often the process of retrievalcan be in an extreme form and can be seen by the public, andthe courts, as excessive and perhaps illegitimate.

The Section values the imput of all its members.Make your opinion count. Contact us at

[email protected]. Let us know how we can help you get more involved with Section activities.


2006 Midyear Meetingof the

ABA Section of Administrative Law and Regulatory Practice

February 10-12, 2006Hyatt Regency • Chicago, Illinois

PROGRAMS■ The Antitrust Pot Boils Over: Is Deception in

Rulemaking an Antitrust Violation?(The Unocal case)Co-sponsored by the ABA Antitrust Law Section

■ Antitrust and Administrative Law: Exploring the Mandate of the Antitrust ModernizationCommission – Regulated Industries Co-sponsored by the ABA Antitrust Law Section

■ Post-Katrina Catastrophe!: Ecosystem,Structural, Environmental, and Insurance Law ChallengesCo-sponsored by the ABA Section of Environment,Energy and Natural Resources

■ Regulating CorruptionCo-sponsored by the ABA Criminal Justice Section and the ABA State and Local Government Section

■ Deference: Seventh Circuit Judges Talk About Reviewing Agency Determinations of Law, Fact and Discretion

■ Federal Lobbying Disclosure: Is Reform Needed?

■ The Perfect Storm A Panel Presentation by the Standing Committee on Law and National SecurityCo-sponsored by AdLaw Section Homeland Security Committee

SPECIAL EVENTS■ Friday Evening Reception at the

ABA Museum of Law ■ Saturday Evening Dinner with guest speaker

Monique Edwards, Executive Counsel,Louisiana Department of Natural Resources

Make plans now to attend.Visit www.abanet.org/adminlaw for complete meeting details and registration information.

Section Chair: Eleanor D. KinneyMeeting Co-Chairs: Cynthia Drew and Michael Asimow

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by Robin Kundis Craig*

Assigning the Burden of Persuasion in Administrative Hearings

In November 2005, the Supreme Court determined 6-2(new Chief Justice Roberts took no part in the decision) that,in administrative “due process”hearings pursuant to the Indi-viduals with Disabilities in Education Act (IDEA), 20 U.S.C.§§ 1400 et seq., the parent of a child with disabilities has theburden of proof/persuasion when challenging a schooldistrict’s individualized education program (IEP) for thatchild.Schaffer v.Weast,— U.S.—,— S.Ct.—, 2005 WL3028015 (Nov.14, 2005).This decision fills a gap in IDEA’sotherwise fairly specific requirements for such “due process”hearings.See id. at *3 (discussing the procedural requirementsin 20 U.S.C.§ 1415).The majority’s opinion, authored byJustice O’Connor, affirmed the divided Fourth Circuit’s assig-nation of the burden of persuasion to parents, despite thedistrict court’s conclusion that the burden of proof moreproperly belonged with the school district. Id. at *4.

Because “[t]he plain text of IDEA is silent on the allocationof the burden of persuasion,” the Supreme Court majority“beg[a]n with the ordinary default rule that plaintiffs bear therisk of failing to prove their claims.” Id. Interestingly, themajority cited to section 556(d) of the federal AdministrativeProcedure Act (APA) as evidence of Congress’ adoption ofthis “ordinary default rule” for administrative adjudications, id.at *5, even though the APA in fact puts the burden of proofon “the proponent of a rule or order” (generally the actingagency), regardless of whether that proponent is the “plain-tiff”or the “defendant.”5 U.S.C.§ 556(d).Closer analogy tothe APA in this IDEA case thus would have placed the burdenof proof on the proponent of the challenged IED – i.e., onthe school district.

Nevertheless, the Court concluded that,“[a]bsent somereason to believe that Congress intended otherwise, there-fore, we will conclude that the burden of persuasion lieswhere it usually falls, upon the party seeking relief.” Schaffer,2005 WL 3028015, at *5. It rejected the plaintiffs’ analogy toconstitutional due process hearings and Mathews v. Eldridgebalancing, noting that the burden of persuasion is not part ofthat constitutional balancing. Id. at *6. Nor was the Courtpersuaded by plaintiffs’ argument that placing the burden ofproof on the school district would provide a proceduralsafeguard that would help to ensure that school districtseffectuated IDEA’s purposes of providing appropriateeducation to all disabled students. Instead, characterizing theplaintiffs’ argument as,“in effect,”“ask[ing] this Court toassume that every IEP is invalid until the school district

demonstrates that it is not,” the Court cited to financialconsiderations and IDEA’s “stay put” provision, under whichstudents remain in their then-current placements during theIEP “due process” hearing, as evidence that the normaldefault rule was the better approach.“Congress appears tohave presumed instead that, if the Act’s procedural require-ments are respected, parents will prevail when they havelegitimate grievances.” Id.

The Court was less dismissive of the plaintiffs’ argumentthat school districts should bear the burden of proof basedon districts’ greater access to the relevant information.However, although it acknowledged that “[s]chool districtshave a ‘natural advantage’ in information and expertise,” themajority again concluded that Congress’ procedural safe-guards in IDEA were sufficient to resolve the disparity. Id. at*7. Specifically,“IDEA hearings are deliberately informal andintended to give ALJs the flexibility that they need to ensurethat each side can fairly present its evidence,” and the statuteguarantees parents access to the school district’s information.Id.Thus,“[t]he burden of proof in an administrative hearingchallenging an IEP is properly placed upon the partyseeking relief.” Id. at *8.

In deciding Schaffer, the Supreme Court majority reliedon federal law to reach its decision, assuming without expla-nation that federal law dictates the procedures used toadjudicate rights created by federal statute, despite the factthat state and local officials conduct the IDEA IEP “dueprocess” hearings and despite majority’s acknowledgementthat the IDEA is based on cooperative federalism. Id. at 2.Moreover, the decision it reached appears to be fairly defini-tive on the assignment of the burden of proof, despite thefact that the school district and several amici states arguedthat that states “may, if they wish, override the default ruleand put the burden always on the school district.” Id. at *8.Because neither party had argued that point in the courtsbelow, the majority declined to reach it. Id.

Nevertheless, Justice Breyer dissented specifically to arguethat because Congress “did not decide that ‘burden ofpersuasion’ question,”“it left the matter to the States fordecision.” Id. at *13 (J. Breyer, dissenting). Because Marylandhad state rules of administrative procedure in place at thetime of the IEP hearing, Justice Breyer would haveremanded to the state ALJ for a determination of how statelaw would have resolved the burden of persuasion issue. Id.at *14 (J. Breyer, dissenting).The Schaffer decision thus raisesa converse-Erie issue that is increasingly appearing in federaladministrative schemes that are based on federal delegationsof programs to state governments:To what extent mustfederal procedural requirements accompany state implemen-tation of federal programs? See, e.g., Legal EnvironmentalAssistance Foundation, Inc. v. U.S. EPA, 400 F.3d 1278, 1281

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* Associate Professor of Law,Indiana University School of Law,Indianapo-lis; and Contributing Editor,Administrative & Regulatory Law News. continued on next page


(11th Cir. 2005) (challenging the EPA’s delegation of CleanAir Act permitting programs to Florida and Alabama on thegrounds that the state requirements for standing would notmatch the federal requirements).

It remains to be seen whether the Supreme Court will bewilling to revisit the burden of proof issue with regard toany of the states that have explicitly assigned the burden ofproof in IDEA “due process” hearings to school districts.Nevertheless, the Schaffer Court was ambiguous regardingwhether its assignation of that burden is a rule of law basedon its construction of the IDEA or merely a default gap-filler that states are free to change as they see fit.As such, thenext case, if accepted, might prove an interesting test ofmany of the limits of the Supreme Court’s June 2005 deci-sion in National Cable & Telecommunications Association v. BrandX Internet Services, — U.S. —, 125 S. Ct. 2688, 2700-01(2005), discussed in the Fall 2005 Supreme Court News, inwhich the Supreme Court indicated that, under Chevron,federal agencies were free to revise court interpretations ofstatutes so long as the court interpretation was not the onlypossible reading of the statute.

Justice Ginsburg also dissented in Schaffer, arguing that theburden of proof should always be on the school district inIDEA “due process” hearings.While acknowledging themajority’s default rule, she was “persuaded that ‘policyconsiderations, convenience, and fairness’ call for assigningthe burden of proof to the school district in this case.” Id. at*9 (J. Ginsburg, dissenting). Unlike most civil rights andsocial welfare statutes, Justice Ginsburg pointed out, IDEA“casts an affirmative, beneficiary-specific obligation on theproviders of public education.” Id.As a result,“[t]he propo-nent of the IEP, it seems to me, is properly called upon todemonstrate its adequacy.” Id. Moreover, as a practicalmatter, Justice Ginsburg argued,“[p]lacing the burden onthe district to show that its plan measures up to the statuto-rily mandated ‘free appropriate public education,’ 20 U.S.C.§ 1400(d)(1)(A), will strengthen school officials’ resolve tochoose a course genuinely tailored to the child’s individualneeds.” Id. at *10. She emphasized that in the Schaffer caseitself,“[n]ot until the District Court ruled that the schooldistrict has the burden of persuasion did the school designan IEP that met Brian Schaffer’s special educational needs,”id., and that “nine States, as friends of the Court, have urgedthat placement of the burden of persuasion on the schooldistrict best comports with IDEA’s aim.” Id. at *11.

Stare Decisis in Statutory ConstructionFor the second time in five months, the Supreme Court

discussed the role of stare decisis in statutory interpretation.As was discussed in the Fall 2005 Supreme Court News andabove, in June 2005 the Supreme Court indicated that,under the Chevron doctrine, federal agencies are free to

change federal courts’ interpretations of the statutes that thefederal agencies administer, so long as the federal courts havenot determined that the statute is unambiguous. NationalCable, 125 S. Ct. at 2700-01.As result, the Ninth Circuiterred in preferring, on stare decisis grounds, its own priorinterpretation of the statute at issue to the federal agency’ssubsequent interpretation of that statute, because the NinthCircuit precedent had merely suggested the “best” readingof the statute – not that its construction was the only inter-pretation possible. Id. at 2701-02.

Nevertheless, a unanimous Court indicated in November2005 that stare decisis – at least with respect to the SupremeCourt’s own interpretive precedents – is still important tostatutory interpretation, even in federal agency administeredregulatory programs. In IBP, Inc. v.Alvarez, — U.S. —, — S. Ct. —, 2005 WL 2978311 (Nov. 8, 2005), the Courtaddressed the issues of whether the federal Fair Labor Stan-dards Act of 1938 (FLSA), 29 U.S.C. §§ 201 et seq., asamended by section 4 of the Portal-to-Portal Act of 1947,29 U.S.C. § 254, required employers in meat and poultryprocessing plants to pay workers for the time that: (1) meatworkers spent walking from the locker rooms to theproduction areas after donning special protective gear andclothing; (2) poultry workers spent waiting to doff suchprotective gear at the end of the work day; and/or (3)poultry workers spent waiting at the beginning of the workday to don protective clothing.The unanimous Court heldthat walking time for the meat processors and end-of-the-day waiting time for the poultry workers were not“preliminary or postpreliminary” activities excluded fromFLSA coverage by the Portal-to-Portal Act but instead were“integral and indispensable” to the “principal activities” forwhich the workers were paid and hence were included inthe workday under the “continuous workday” rule. Incontrast, the time that the poultry workers spent waiting todon special clothing at the beginning of the work day was“preliminary or postpreliminary,” and hence the Portal-to-Portal Act did exclude that time from the FLSA’s coverage.

In interpreting the FLSA and the Portal-to-Portal Act,however, the Supreme Court focused almost entirely on itsown prior interpretations of the FLSA and Congress’ reac-tions to those interpretations; the Department of Labor’sregulations implementing the Act’s played little role in thediscussion.See, e.g., IBP, Inc., 2005 WL 2978311, at *3(discussing the Supreme Court’s early FLSA decisions andCongress’ reaction to them in the Portal-to-Portal Act), *4(discussing the Supreme Court’s interpretation in Steiner v.Mitchell, 350 U.S. 247, 248, 252-53 (1956)).The Court alsoemphasized that,“consistent with our prior decisions interpret-ing the FLSA, the Department of Labor has adopted thecontinuous workday rule . . . .These regulations haveremained in effect since 1947 . . . .” Id. at *4 (emphasis added;

18

Supreme CourtNews

citing 29 C.F.R.§ 790.6(b), 12 Fed.Reg. 7658 (1947)).In this context, the Court stated,“[c]onsiderations of stare

decisis are particularly forceful in the area of statutoryconstruction, especially when a unanimous interpretation ofa statute has been accepted as settled law for severaldecades.” Id. at *6. Facing the employer’s argument that someof the Department of Labor’s regulations suggested a differ-ent result, moreover, the Court characterized thoseregulatory provisions as “ambiguous (and apparentlyambivalent),” emphasizing that they were “not sufficient toovercome the statute itself, whose meaning is definitivelyresolved by Steiner.” Id. at *8.

IBP, Inc., presented the Court with a fairly easy resolutionof any possible tensions between the Department of Laborregulations and its own precedent, given that the regulations

did not directly address the issues that the Court was decid-ing. However, the Court’s casual assertion that its priorinterpretations were “definitive” is in tension with theCourt’s emphasis on the Ninth Circuit’s lack of specificfinding of non-ambiguity in the Ninth Circuit’s precedentin National Cable. 125 S. Ct. at 2701-02. Notably, JusticeStevens, who had concurred specifically in National Cable toemphasize that the non-ambiguity requirement might notapply to the Supreme Court’s pre-regulation interpretationsof statutes, id. at 2712 (J. Stevens, concurring), authored theIBP, Inc., decision. One therefore suspects that additionaldiscussions of the relationship between federal court princi-ples of stare decisis and agency re-interpretations of federalstatutes will be forthcoming.


A Guide to Judicial and Political Review of Federal Agencies from the ABA Section of Administrative Law and Regulatory Practice

This book provides a thorough overview of the law of judicial and politicalcontrol of federal agencies. The primary focus is on the availability andscope of judicial review, but the book also discusses the control exercisedby the U.S. president and Congress. This comprehensive guide is acompanion to two other titles published by the Section of AdministrativeLaw and Regulatory Practice: A Guide to Federal Agency Adjudicationand A Guide to Federal Agency Rulemaking.

Topics include:• Availability of Judicial Review• Judicial Review of Statutory Issues Under the Chevron Doctrine• Judicial Review of Statutory Issues Outside of the Chevron Doctrine• Judicial Review of Nonstatutory Legal Issues• Judicial Review of Issues of Fact• Political Checks on the Administrative Process• And more

$54.95 Administrative Law and Regulatory Practice Section member price$74.95 Regular priceProduct code: 5010039, ©2005, 6 x 9, 316 pages, paperback

To Order, Go To www.ababooks.org


by William S. Jordan III*

Decisions Applying Brand X Reveal New Chevron Complexities

At first glance it seemed simple enough.The SupremeCourt’s decision in National Cable & Telecommunications Ass’nv. Brand X Internet Services, 125 S.Ct. 2688 (2005), made itclear that a prior judicial ruling does not, through staredecisis, prevent an agency from reaching a contrary positionon an issue of statutory interpretation that qualifies forChevron deference.Two recent decisions reveal that this willrequire careful attention to the precise basis for such priorjudicial decisions. One suggests that Brand X has significantlychanged the nature of decisions at so-called Chevron StepOne.

In Metrophones Telecommunications, Inc. v. Global CrossingTelecommunications, Inc, 423 F.3d 1056 (9th Cir. 2005), apayphone operator sought compensation from a longdistance provider whose services were accessed through thepayphone by using a free access (e.g.,“1-800”) connection.FCC regulations required such compensation, but the 9th

Circuit had previously held in the same litigation that“There is no private right of action for the relief that PSPsseek, to recover damages for [a carrier’s] alleged failure topay compensation for dial-around calls as required by FCCregulations promulgated pursuant to § 276 of the Telecom-munications Act.”The court had based its decision on theproposition that private right of action can arise from astatutory obligation, but not from an obligation arising froma regulation. Since § 276 had merely authorized the regula-tion, it could not serve as a basis for a private action.

After that decision, the payphone operator amended itscomplaint to assert a claim under §§ 201(b) and 416(c) ofthe Act, which address “unjust and unreasonable practices”and the duty to comply with FCC orders.The question inMetrophones Telecommunications was whether the previousdecision’s broad language precluded the new claims. In theinterim, the FCC had adopted a legislative rule stating that,“[a] failure to pay in accordance with the Commission’spayphone rules…constitutes…an unjust and unreasonablepractice in violation of section 201(b) of the Act.”Thus,under the FCC’s new interpretation, § 201(b) of the Actcould be a source of private action even if § 276 were not.

Although the previous 9th Circuit decision’s language wasbroad enough to cover any private effort to enforce theobligations of the § 276 regulation, it was at most an“implicit” ruling about the scope of § 201(b).As such, the

court said in Metrophones Telecommunications, it was notenough to constitute a binding precedent in the wake ofBrand X. Somewhat surprisingly, the court then struggled abit with whether, given its brevity, the FCC’s rule qualifiedfor Chevron deference.After describing the history of therule, the court concluded that it constituted the “fair andconsidered judgment” of the agency.

These rulings suggest two areas for argument in Brand Xor Chevron analysis. First, just what was the nature of theprevious judicial decision? If it was merely “implicit,” itwould not bind the agency.This might well follow fromChevron itself, with no need for Brand X. Second, does thelanguage of the agency’s later legislative rule really count aspart of the rule for Chevron purposes? Agencies may nowhave to argue that particular regulatory language (or otherChevron-qualified interpretive language) constitutes the “fairand considered judgment” of the agency. Surely the answershould be that if the statement is in the regulation, it countsas “fair and considered” for Chevron purposes.

Having decided to apply Chevron, the court upheld theagency’s interpretation of § 201(b),but rejected its interpreta-tion of § 461(c) as overly broad.The court also provided auseful discussion of implied preemption of state law, addressingboth “field”preemption and “conflict”preemption.

In AARP v.Equal Employment Opportunity Commission,No.05-CV-509 (E.D.Pa., filed Sept.27,2005), the AARP hadobtained an injunction against an EEOC rule that wouldpermit employers to terminate health plans for older workersonce they qualified for Medicare. In issuing that injunction,the District Court had considered itself bound by a previousThird Circuit decision:“the Third Circuit has already deter-mined that Congress has expressed a clear and unambiguousintent with regard to the precise question at issue.”Despite thatseemingly definitive language, the EEOC moved for relieffrom judgment in light of the Brand X decision.

One might wonder why there was any room for theEEOC even after Brand X. If Congress had “expressed aclear and unambiguous intent with regard to the precisequestion at issue,” wasn’t that the end of it? The DistrictCourt is correct in stating that,“Crucially, Brand X makes itclear that where a court’s holding states merely the “best”interpretation of a statute, not the “only permissible” inter-pretation, the court decision does not foreclose a later,differing agency interpretation.” But the court’s characteri-zation of the Third Circuit’s earlier decision reads as “only permissible.”

In addressing the earlier Third Circuit decision, the courtnoted that the Third Circuit did not explicitly say that it hadreached the “only permissible reading of the statute,” andthat the Third Circuit had stated that a different congres-sional intent was “possible,” and that the one it chose was“more likely.”The Third Circuit also noted that it had “a

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News from the Circuits

*C.Blake McDowell Professor of Law,The University of Akron Schoolof Law;Vice Chair, Judicial Review Committee; and ContributingEditor,Administrative & Regulatory Law News.


difficult task of statutory interpretation,” and it discussedambiguities in the statute. Both points were significant tothe District Court’s conclusion that the Third Circuit hadnot settled on the only possible interpretation.

Remarkably, the District Court then decided that theThird Circuit’s reliance on legislative history established thatthe statute was ambiguous for the purpose of Chevron StepOne analysis.This is consistent with the familiar canon thatlegislative history is to be considered only if the statute isambiguous, but it is inconsistent with Chevron’s famous fn. 9,under which a Chevron Step One decision is to be madeusing “traditional tools of statutory construction” whichinclude legislative history. If this approach is widely adopted,strict textualism will dominate Chevron Step One analysis.

When Does a New Interpretation in a Preamble to a Final Rule Violate the “Logical Outgrowth” Requirement?

EPA, in implementing the Clean Air Act,has adopted tworules governing monitoring for compliance by those subject tothe Act.As its name suggests, the “periodic monitoring” rulerequires periodic monitoring to provide “reliable data” toassure compliance with applicable requirements.The“umbrella rule” requires that each air pollution permit includemonitoring requirements “sufficient to assure compliance withthe terms and conditions of the permit.”The rules togetherraise the question of whether the “umbrella rule”constitutes asource of monitoring requirements over and above those ofthe “periodic monitoring rule.”

In two permit proceedings,EPA decided that the “umbrellarule”was a separate source of authority under which statescould impose monitoring requirements on a case-by-case basisindependent of the requirements of the “periodic monitoring”rule.EPA then proposed to delete some regulatory language toclarify this point.After notice and comment,EPA reversedcourse.Not only did it decline to adopt its proposal, it stated inthe preamble to its final rule that the two rules were not “sepa-rate regulatory standard[s],”with the result that states werenow prohibited from adding new monitoring requirementsunder the “umbrella rule.”

In Environmental Integrity Project v.EPA, 425 F.3d 992 (D.C.Cir.2005), the D.C.Circuit held that EPA’s reversal did notconstitute a “logical outgrowth”of its proposal.The decisionillustrates the interaction of the “logical outgrowth” rule withthe Paralyzed Veterans principle that an agency may not changea previously stated interpretation without going throughnotice and comment.Since EPA had stated a contrary inter-pretation in its previous two permit decisions, it could not statea new interpretation without notice and comment.Thus, thecase is distinct from one in which EPA simply proposed oneinterpretation but adopted another.Here,EPA could not

adopt its desired interpretation without successfully pursuingnotice and comment.

As to the “logical outgrowth”question,EPA argued that ithad met its notice obligation “because its final interpretationwas also mentioned (albeit negatively) in the Agency’sproposal.”The court rejected this proposition because,“If theAPA’s notice requirements mean anything, they require that areasonable commenter must be able to trust an agency’s repre-sentations about which particular aspects of its proposal are openfor consideration.”Having been mentioned negatively,EPA’slater interpretation did not appear to be “open for considera-tion.”“Whatever a ‘logical outgrowth’of this proposal mayinclude, it certainly does not include the Agency’s decision torepudiate its proposed interpretation and adopt its inverse.”

The lesson is that an agency must carefully consider whetherits proposed rule has left open the possibility of adopting anoutcome at odds with the proposal. In this case, the agency was free not to adopt the proposed change in regulatorylanguage,but it could not go beyond that to a definitive statement of contrary interpretation without alerting thepublic to that possibility.

Tenth Circuit Denies Deference to BLM in “Primary Jurisdiction” Referral

In the days before both urban sprawl and modern federalagency processes, an 1866 statute provided for an open-endedgrant of “the right of way for the construction of highwaysover public lands,not reserved for public uses.”Countygovernments, for example, could build roads across publiclands without so much as an application to do so,much lessthe approval of a federal agency.Congress repealed this provi-sion in 1976,effectively freezing all such rights of way at theirstatus in 1976.

In 1996, several Utah counties graded what the countiescalled roads,but the Bureau of Land Management termed“primitive trails.”The rights of way crossed highly valuedlands, including a National Monument and wilderness areas.The counties claimed the right to take this action withoutconsultation or approval from the BLM.The Southern UtahWilderness Association (SUWA) challenged the counties inFederal District Court and also urged the BLM to act againstthe counties.

The District Court held that the counties did not committrespass, but otherwise it referred issues related to the validityof the counties’ actions to the BLM.The BLM then conductedinformal adjudications with respect to each of the disputedrights of way, ruling that fifteen were invalid claims, and that in one other case the county had exceeded the scope of its rightof way.The District Court then reviewed the BLM decisionson the record, refused to accept additional evidence from the

2121



counties, and affirmed the BLM decisions in their entirety assupported by substantial evidence and Skidmore deference.

In Southern Utah Wilderness Alliance v.Bureau of LandManagement,425 F.3d 735 (10th Cir. 2005), the Tenth Circuitfirst held that anything beyond mere maintenance of existingrights of way would constitute trespass, and it discussed thedistinction between construction and maintenance.Thecentral question,however,was whether the District Court had properly applied the doctrine of “primary jurisdiction”in such a way as to give essentially binding effect to the BLM decisions.

The Tenth Circuit held that the BLM decisions were notentitled to such status.First, the court addressed the standard ofreview of the District Court’s decision to refer the matters forbinding primary jurisdiction.With no analysis, the courtadhered to an “abuse of discretion” standard,noting that “anyerror of law is presumptively an abuse of discretion and ques-tions of law are reviewed de novo.”

On the merits of the referral, the court noted that theprudential doctrine of primary jurisdiction is a means of allo-cating authority between agencies and courts.The centralquestion is whether “the issue is one ‘that Congress hasassigned to a specific agency.’” If so, the court may stay its ownproceeding and direct the parties to seek resolution by theagency in question.

If Congress has assigned the matter to the agency, the ques-tion becomes whether referral would serve the two-foldpurposes of the doctrine.First,would it contribute to regula-tory uniformity? Second,would it make appropriate use of theagency’s expertise?

The Tenth Circuit rejected the BLM’s argument that itsgeneral statutory authority over the public lands constitutedauthority with respect to the right of way grants in question.The court distinguished between “a land agency’s responsibil-ity for carrying out the executive function of administeringcongressionally determined procedures for disposition offederal lands [and] the authority to adjudicate legal title to realproperty once those procedures have been completed.”BLMhad only administrative authority in this instance,by contrastto its authority to grant patents under the mining laws.As aresult, the District Court had abused its discretion by referringthe matter to the BLM for binding primary jurisdiction andlimited judicial review.

Note,however, that it would not be an abuse simply to referthe matter to the BLM for the agency to develop its owninternal position and apply its factual expertise,both of whichare of use to the court.The Tenth Circuit remanded to theDistrict Court for a de novo proceeding in which the partiescould introduce evidence, including the record of the BLMdecisions.The court also addressed a number of legal issuesrelated to the decision,noting that the BLM’s interpretiveviews are entitled to Skidmore deference,but that the agency’s

reversals of position in recent years would bear on the degreeof persuasiveness.

This decision is unusual in addressing a particularly strongtype of primary jurisdiction, one under which the agency’sdecision is binding and subject to limited review.As empha-sized in Chevron and its progeny, such deference to agencyviews is primarily a function of the authority delegated tothe agency. It follows that where there has been no suchdelegation, there can be no such deference.This does notmean, however, that it was entirely inappropriate to refer thematter to the BLM.As the court notes, careful BLM devel-opment of its own position and application of its expertiseto the facts could be helpful to the court. But any BLMcontribution could not, in effect, substitute for a de novodecision by the court itself.

All that Work for PeanutsIn an era of marketable pollution permits and similar

efforts to harness market forces to serve regulatory goals, wemight expect regulators (and government budget analysts)to shudder if such permits or quotas were found to consti-tute property rights for which compensation might berequired. It might well become practically impossible toimplement a declining-cap trading program or otherwise toreduce or eliminate allowances.The adopted scheme couldbe frozen in place by fiscal realities.

In establishing the nation’s largest such scheme, the acidrain allowance trading program, Congress addressed thisissue by providing that,“Such allowance does not constitutea property right.” But what if Congress did not address thispoint clearly? And what if allowances or quotas are found toconstitute property rights? The Federal Circuit addressedthese questions in Members of the Peanut Quota Holders Ass’n,Inc. v. United States, 421 F.3d 1323 (Fed. Cir. 2005).

Plaintiffs held peanut quotas under legislation enacted in1996.The quota system served to support peanut prices andalso enabled plaintiffs to obtain loans at favorable rates.Theseparticular peanut farmers did not work in the fields. Instead,they leased their quotas to others to produce peanuts. In2002, Congress enacted legislation limiting quotas to thoseactually farming or otherwise sharing in the risk of farmingpeanuts. Plaintiffs then claimed a taking of the loan rate theywould have been able to obtain in 2002 and of futurequotas.

Reciting the familiar litany that property rights arise from sources other than the Constitution, the court firstrecognized that no property rights arise if the relevant legis-lation specifically so provides, as with the acid rain program.The Federal Circuit then articulated the following test fordeciding whether legislation has given rise to property

22

News from the Circuits

continued on page 28


TOPIC:

Discuss a problem or issue arising at the intersection of

constitutional and administrative law.

ELIGIBILITY:The competition is open to currently enrolled students of ABA-accredited law schools who are also members of the ABA Section ofAdministrative Law and Regulatory Practice.

The essay must be the student’s original, unpublished work. Thepaper may be prepared to satisfy a course requirement or for otheracademic credit. However, the essay must be the work of the submit-ting student without substantial editorial input from others.Co-authored papers are ineligible. Only one essay may be submittedper entrant.

FORMAT:Essays must not exceed 12 pages, including title, citations, and any footnotes. The text of the essay must be double-spaced, withtwelve-point font and one-inch margins.

Entries should reflect the style of Administrative Law News articles rather than law review style. Entrants are encouraged toreview past copies of the News available at ww.abanet.org/admin-law/news/backpage.html - prior to drafting their submissions.Citations must be embedded in text or in footnote form; essays withendnotes will be disqualified. Cites must conform with the 18thEdition of The Bluebook: A Uniform System of Citation.

ENTRY PROCEDURE:Each submission must include a SEPARATE COVER PAGE with theentrant’s name, law school, year of study, mailing and email address,and phone number. The contestant’s name and other identifyingmarkings, such as school name, MAY NOT appear on any copy of thesubmitted essay. Send three copies of the essay, a digital copy in Wordformat on an IBM-formatted diskette or CD-ROM. Submissions must be postmarked no later than March31, 2006 and mailed to American Bar Association, Admin Law Essay Competition, 740 15th Street NW,Suite 900, Washington, D.C. 20005

Section of Administrative Law and Regulatory Practice staff will assign a random number to each entry andrecord this number on all copies of each essay submitted. Neither the contestant’s identity nor his/heracademic institution will be known to the selection committee.

By submitting an entry in this contest, the entrant grants the ABA and the ABA Section of AdministrativeLaw and Regulatory Practice permission to edit and publish the entry in the Administrative Law News.

Please direct any questions about the contest to the Section Staff Director [email protected].

JUDGING:Entries will be judged based onthe following criteria:

• Creativity and clarity of theproposal or thesis

• Organization• Quality of the analysis

and research• Grammar, syntax and form

The entries will be judgedanonymously by the Fellows ofthe ABA Section of Administra-tive Law and Regulatory Practice.

PRIZE:

The winner will receive a $500cash prize and round-trip airfareand accommodation to attend theSection’s Fall Conference inWashington, DC. At the discre-tion of the editorial board, thewinning entry will be selected forpublication in Administrative andRegulatory Law News.

2006 Gellhorn-Sargentich Law Student Essay Competition


By Yvette M.Barksdale*

1. Dan M.Kahan,Paul Slovic,Donald Braman,and John Gastil, Fear and Democracy or Fear ofDemocracy?:A Cultural Evaluation of Sunstein onRisk, 119 Harv.L.Rev._____ (forthcoming 2006);http://ssrn.com/abstract=801964.This article critiquesProfessor Cass Sunstein’s recent book,Laws of Fear:Beyondthe Precautionary Principle (Cambridge University Press2005).Sunstein’s book analyzes how social and cognitivemechanisms cause the public to generate and fixate onwildly inflated estimates of societal risk.The reviewersdescribe the book as an impressive contribution to the studyof risk perception,but argue that Professor Sunstein ulti-mately misses the impact of cultural cognition or “culturalworld view”on the public’s perception of risk.Thesecultural world views cause people to attach “despised”or“valued” social meanings to various activities, such asfirearm possession,nuclear power generation,and red-meatconsumption.These social meanings in turn can determinehow individuals emotionally react to those activities (e.g.with anxiety or calmness,dread or admiration).Relying onexisting and original empirical research, the authors developa “cultural evaluator”model,which they argue explainsindividual variation in risk perception,differences of opinions among experts, and the intensity of politicalconflict over risk better than Sunstein’s “irrational weigher”approach.

2. Liza Heinzerling,The Accidental Environmentalist:Judge Posner on Catastrophic Thinking, 94 Geo.L.J.____ (Forthcoming 2006),http://ssrn.com/abstract=770326. In this article,LizaHeinzerling reviews Judge Richard A.Posner’s book,Cata-strophe:Risk And Response, (Oxford University Press2004).Professor Heinzerling concludes that Judge Posner’sbook,which advocates greater attention to the potential forcatastrophic events, i.e., those which pose a “small,but plau-sible, risk of extinction for the human race,” is a very finedescription of catastrophic risks and the limits of conven-tional risk assessment in addressing them.Indeed, JudgePosner’s catastrophic risk analysis turns him into a closetenvironmentalist,who embraces pollution control,acknowledges the indeterminacy of calculating a dollarvalue for human life, and advocates regulation in the face ofsubstantial scientific uncertainty – the basic insight underly-

ing the precautionary principle, an environmentalist tool.However, she argues, the book is flawed by its doggedcommitment to cost-benefit analysis (CBA),whichHeinzerling argues is inconsistent with the conclusionsJudge Posner draws regarding catastrophic risks.Thus, eventhough he implicitly embraces environmental values,Heinzerling argues, the book in the end is patently hostileto environmentalists and environmentalism. Instead Posnershould have taken his catastrophic risk positions to theirlogical conclusions and rejected using CBA to evaluatecatastrophic risks.

3. Gregory N.Mandel,Technology Wars:The Failureof Democratic Discourse,11Mich.Telecomm.Tech.L.Rev.117 (2005), available athttp://www.mttlr.org/voleleven/mandel.pdf.The author argues that individual opinion formation,behavior,psychology,and perception each play aconsiderable role in creating and perpetuating public conflictover technology, such as in disputes over genetically modifiedproducts,nuclear power,and nanotechnology.The authorcombines original empirical research and a multi-discipli-nary body of scholarship from the fields of law,behavioraleconomics,psychology,and political science to provideinsight into inefficiency and polarization in technologyconflict, and into the related democratic and market failuresthat inhibit resolution of these conflicts.Some relevantfactors are 1) socio-cultural risk preference formation,2)behavioral economics and cognitive and social psychology,3)the destabilization of science,and 4) the lack of compromiseadvocacy.The author uses that framework to provide moreproductive bases for resolving technology conflict.Theauthor hopes to reduce polarization by helping people toidentify 1) the actual preferences underlying their beliefs, and2) ways of advancing these preferences by mutually achiev-able,or at least reconcilable,means.

4. Roberta Romano,The Sarbanes-Oxley Act And TheMaking Of Quack Corporate Governance, 114 YaleL.J.1521 (2005).Professor Roberta Romano stronglycritiques the Sarbanes-Oxley Act of 2002,Pub.L.No.107-204 (2002).The author argues that the legislation wasadopted despite a considerable body of scholarly researchindicating that the Act’s reforms would not achieve theirintended goals.Focusing on those provisions of the Act that1) require independent audit committees,2) restrict corpora-tions’purchases of non-auditing services from their auditors,3) prohibit corporate loans to officers,and 4) require execu-tive certification of financial statements, the authorcomprehensively analyzes the legislative process which led tothe Act’s passage and the political dynamics which causedsuch flawed legislation to nevertheless be adopted.Drawingon historical examples, the author concludes that the Act

* Associate Professor of Law,The John Marshall Law School,Chicago,IL., former Vice-Chair,Constitutional Law and Separation of PowersCommittee; and Contributing Editor.These abstracts are drawn prima-rily from the authors’ introductions to their articles.To avoid duplication,the abstracts do not include articles from the Administrative Law Reviewwhich Administrative Law Section Members already receive.

Recent Articlesof Interest


demonstrates the problem of emergency or crisis legislationin which “policy entrepreneurs”are able to market prepack-aged policy prescriptions to solution-hungry legislators wholack the time or incentive to adequately reflect.The authoradvocates amending the legislation to make these Sarbanes-Oxley requirements optional instead of mandatory.Theauthor also advocates automatic legislative sunset provisionsfor similarly panicky emergency legislation.

5. Edward Rubin,The Conceptual Explanation forLegislative Failure, 30 Law & Soc. Inquiry 583 (2005). Inthis brief essay,Edward Rubin comments on a book byNoga Morag-Levine,Chasing the Wind:Regulating AirPollution in the Common Law State (Princeton UniversityPress,2003).The book’s author argues that the failure of theClean Air Act to control individual sources of noxious emis-sions was caused by Congress’error in adopting “risk-based”rules, rather than the European– “best available technology”model.Relying on strong empirical evidence, the authorMorag-Levine concluded that Congress’decision was theresult of a conceptual error caused by Congress’over-reliance upon common law analytical models.Rubinremarks that such “conceptual”explanations for failed legis-lation are rare. Instead,commentators usually rely on publicchoice,deliberative democracy and similar political modelsof legislative decision-making to critique legislation.Rubinargues that the kind of conceptual errors identified by thebook’s author may be more frequent than is normallythought.Rubin discusses the Truth-in-Lending Act asanother example of such legislative conceptual error.

6. James J. Brudney and Corey Ditslear,Canons OfConstruction And The Elusive Quest For NeutralReasoning, 58 Vand.L.Rev.1 (2005).This article catalogsthe results of an extensive empirical bivariate and regressionanalysis study of the Justices’use of canons of legislativeconstructions.The authors conducted the study to empiri-cally test competing theoretical explanations of judicial useof the canons, including public choice and legal processaccounts.The authors’database consists of every decisionaddressing workplace law matters since the start of theBurger Court era:632 cases with written opinions from1969 to 2003.The authors identified the outcomes as liberal(pro-employee) or conservative (pro-employer), and deter-mined the Justices’ judicial reasoning techniques by codingthe textual and contextual sources the Justices relied upon intheir written opinions.25% of the majority opinions (160)relied upon legislative canons to some extent.The authorsfound,expectedly, that reliance on canons almost doubledfrom the Burger to the Rehnquist court.Among otherconclusions was that the empirical data more stronglysupported the pessimistic view of some theorists that theJustices used canons to support ideological interpretations of

the statute,often at the expense of conflicting evidence oflegislative preferences.Although both liberals and conserva-tives used the canons in this way, the most frequent such usewas to achieve conservative outcomes in close cases (withone or two vote margins).Additionally, the use of the canonsin cases where the dissent invokes legislative history (all ofwhich cases occurred after 1988),yielded overwhelminglyconservative results.

7. Cass A. Sunstein,Breyers’Democratic Pragmatism,____ Yale L. J.___ (Forthcoming,200_)http://ssrn.com/abstract_id=166326845064.Thisarticle is a review of Justice Stephen Breyer’s recent book,Active Liberty: Interpreting Our Democratic Constitution(Alfred A.Knopf,2005), in which Breyer, responding in partto Scalia’s originalism,discusses the proper role of the judiciaryin constitutional interpretation in a democracy.DescribingBreyer’s book as brisk and lucid,Sunstein analyzes Breyer’sconcept of “active liberty”– a form of participatory democraticself-governance,and evaluates some of Breyer’s applications ofhis interpretive approach to constitutional law issues such asfree speech,affirmative action and privacy.Sunstein concludesthat Breyer’s consequentialist argument is convincing insofar asit challenges the “originalist”approach on pragmatist grounds,but is more vulnerable insofar as it downplays the inevitablerole of judicial discretion in the characterization of purposesand evaluation of consequences that is necessary to implementBreyer’s theory.

8. Michael J.Gerhardt,The Constitutionality of the Fili-buster, 21 Const.Comment.445 (2004).Essay intended as abasic discussion of arguments for and against the constitu-tionality of the filibuster.The author sketches some solutionsfor redressing problems with constitutional argumentationin,and theorizing about, the Senate.The author also developsa theory of non-judicial precedent that will clarify howmuch deference senators and perhaps members of otherinstitutions (including courts) ought to give to the Senate’shistorical practices.

9. Edward Rubin,The Myth Of Accountability And TheAnti-Administrative Impulse, 103 Mich.L.Rev.2073(2005). In this article,Edward Rubin reconstructs theconcept of government accountability.The author arguesalthough that the concept has been recently in vogue, thesediscussions often lack conceptual and empirical rigor and areimproperly used in opposition to the administrative state.The author critiques as ill-founded both the view thatelected officials are accountable to the public, and the viewthat state and local officials are more accountable than federalones.Rather,both are vestiges of pre-analytic hostility to the



administrative state.The author argues that the only coherentconcept of accountability is that it is intrinsically bureaucraticor administrative in character.

10. In Brief: Some recent War on Terror and Iraq articles.

a. Robert M.Chesney, Leaving Guantanamo:The Law of International Detainee Transfers,____ U.Rich.L.Rev.____ (Forthcoming 2006),http://ssrn.com/abstract=827604, analyzes the legalissues relevant to the transfer of prisoners from Guan-tanamo Bay,particularly transfers to countries whomight practice torture.

b. Gregory H. Fox,The Occupation Of Iraq, 36Geo. J. Int’l L.195 (2005),discusses the tangled legalframework relevant to the legality under international lawof the United States’occupation of Iraq and role in Iraq’sreconstitution and reconstruction.

c. M. Cherif Bassiouni, Post-Conflict Justice InIraq:An Appraisal Of The Iraq SpecialTribunal, 38 Cornell Int’l L.J.327 (2005) a self-described “insider’s” legal,historical,political andoccasionally informal discussion of the Iraq SpecialTribunal, the Iraqi court which adjudicates ssthe humanrights and other criminal charges brought by the Iraqigovernment against Saddam Hussein.

RECENT SYMPOSIA OF INTEREST, In Brief.

1. Federal Trade Commission 90th AnniversarySymposium, 72 Antitrust L. J.745 – 1206 (2005).Includes articles by: i) William F.Adkinson, Jr.745, ii)Deborah Platt Majoras,755, iii) Judge Richard A.Posner,761, iv) Tim Morris and Bob Pitofsky,773,v) William E.Kovacic,861,vi) Marc Winerman,871,vii) Edward F.Cox,899,viii) Sidney M.Milkis,911, ix) William MacLeod,Eliza-beth Brunins and Anna Kertesz,943,x) Jodie Z.Bernsteinand David A.Zetoony,969,xi) Susan A.Creighton,D.BruceHoffman,Thomas G,Krattenmaker and Ernest A.Nagata,975,xii) John E.Kwoka, Jr.,997,xiii) Kathryn M.Fenton,1013,xiv) Jonathan B.Baker,1029,xv) Hillary Greene,1039,and xvi) Howard J.Beales, III,1057.

2. Environmental Regulation, Energy and MarketEntry, 15 Duke Envtl.L.& Pol’y F.163 – 339 (2005).Includes articles by: i) Scott Michael Edson,163, ii) RichardJ.Pierce, Jr.,167, iii) David B.Spence,187, iv) Joseph P.Tomain,221,v) Suedeen G.Kelly,251,vi) Steven Ferrey,261,vii), Joel B.Eisen,295,viii) Jim Rossi,315.

3. The European Union, 28 Fordham Int’l L. J.vi – ix,919 – 1215 (2005). Includes articles by: i) Roger J.Goebel,p.vi, ii) Joseph C.Sweeney,p. ix, iii) Ian S.Forrester,919, iv)

Eleanor M.Fox,952,v) Eric Gippini-Fournier,967,vi)Francis G. Jacobs,1049,vii) William E.Kovacic and AndreasP.Reindl,1062,viii) Jeremy Lever,1091, ix) Christian Ahlborn,David S.Evans and A. Jorge Padilla,1109,x) JamesS.Venit,1157,Bo Vesterdorf,1179.

4. The D. C. Circuit Review: Recent Decisions ofthe United States Court of Appeals for theDistrict of Columbia Circuit (July 2003 – June2004),73 Geo.Wash.L.Rev.709 – 948 (2005). Includes a)Article by Cass R.Sunstein,693;b) Topical Student Surveys[i) Administrative Law,709, ii) Civil Procedure,767, iii)Communications Law,792, iv) Constitutional Law,802,v)Energy Law,827,851,vi) Environmental Law,851,vii)Health Care Law,864,viii) International Law,880, ix) LaborLaw,896,x) Property Law,918,xi) TelecommunicationsLaw,931)]; c) Biographies of the Judges of the D.C.Circuit,943;and d) Index of Principal Cases,948.

5. A Review of Recent Decisions of the UnitedStates Court of Appeals for the Federal Circuit,54 Am.U.L.Rev.821-1239 (2005). Includes a) Forward byJudge Pauline Newman,821;b) Article by Joseph ScottMiller and James A.Hilsenteger,829;and c) 2004 AreaSummaries (various authors) for i) Patent Law Decisions,941, ii) Trademark Law Decisions,1181,and iii) Govern-ment Contract Law Decisions,1205.

6. National Security and Telecommunicationsafter 9/11, 57 Fed.Comm.L. J. i – v,351 – 478 (2005).Includes articles by: i) Michael K.Powell,p. i; ii) Jamie S.Gorelick, John H.Harwood II, and Heather Zachary,351,iii) Christopher Guttman-McCabe,Amy Mushahwar andPatrick Murck,413,and iv) James A.Lewis,457.

7. Calabresi’s The Costs of Accidents:A Genera-tion of Impact on Law and Scholarship, 64 Md.L.Rev.1 – 754 ( 2005 ). Includes articles by: i) Donald G.Gifford,1, ii) Judge Richard A.Posner,12, iii) AdamBenforado (student) and Jon Hanson,24, iv) Keith N.Hylton,85,v) Francesco Parisi and Vincy Fon,108,vi) FrankI Michelman,136,vii) Gregory C.Keating,159,viii) UgoMattei,220, ix) Hanoch Sheinman,250,x) Anita Bernstein,303,xi) Jules Coleman,337,xii) Justice (ret.) Izhak England,Israel Sup.Ct.,355,xiii) John C.P.Goldberg and BenjaminC.Zipursky,364,xiv) Catherine M.Sharkey,409,xv)Michael L.Rustad,461,xvi) Anthony J.Sebok,541,xvii)Kenneth S.Abraham,573,xviii) Donald G.Gifford,613,xix)Robert L.Rabin,699,xx) Oscar S.Gray,734,and xxi) JudgeGuido Calabresi,736.

Recent Articlesof Interest


Edited by Edward J. Schoenbaum*

Attorney’s Fees For PublicInterest Litigation: A Bridge Too FarBy Michael Asimow

By statute (Code of Civil Procedure§1021.5),California awards a successfulparty attorneys’ fees in public interest liti-gation. (Federal law is exactly theopposite and awards attorneys’ fees onlypursuant to specific statutes).Sometimes,as in Bowman v.City of Berkeley,31Cal.Rptr.3d 447 (Crt.App.2005), thepublic interest that’s vindicated seemspretty marginal.

In Bowman,neighbors tried to stopconstruction of a subsidized four-storysenior living facility on various estheticand environmental grounds.The Cityapproved construction and the neighborswent to court to stop it.They lost on allof their environmental and land usearguments,but won a brief victory underdue process (the City Council had failedto further notify the neighbors that thematter was on the evening agenda).Afterremand, the City reconsidered theproject and again approved it.Thus thelitigation achieved only delay in buildingthe project, a delay that jeopardizedfunding for the facility’s construction. Itmust have cost the developers dearly,notto mention the seniors who wanted to move into the facility.

To get attorney’s fees, a plaintiff musthave been “successful.”The court heldthat the “success” test had been met eventhough plaintiffs lost on all of theirsubstantive theories and achieved only anew consideration of the issue (which

they lost). In addition,plaintiff mustestablish that the litigation conferred a “significant benefit on the generalpublic.”This test was met because a lot ofpeople participated in the rehearingbefore the City Council (to no avail).Finally,plaintiff must establish that thecost of the litigation “transcends theclaimant’s personal interest,”but sincenobody was litigating except people wholived in close proximity to the projectand who didn’t want a high rise on theirstreet, it is difficult to see what interestsother than the claimants’were at stake.

As a result, the taxpayers in the smallcity of Berkeley were saddled wiathpayment the neighbor’s attorneys’ fees(totaling $70,000).Perhaps this liabilitywill result in Berkeley’s having to cut oneor two staff positions for a year.Yet theprotracted litigation achieved nothing ofsignificance for the neighbors or anyoneelse.While the concept of public interestattorneys’ fees is a noble one,courtsshould confine it to cases of genuinesuccess and public benefit.

Pennsylvania Supreme CourtStrikes Down Portion of SlotsStatute as Improper Delegationof Legislative Power to Gaming CommissionBy John L.Gedid

The Pennsylvania legislature enacted astatute that legalized slot machinegambling at limited locations in the state.The Gaming Act (Act) contained elabo-rate provisions for licensing andcontinuing close regulation of thegaming industry by a newly createdagency, the Gaming Commission.Acoalition consisting of state legislatorsand nonprofit organizations opposed togambling brought an action that chal-lenged the constitutionality of the Act onnumerous grounds that included unlaw-ful delegation of legislative powers to theGaming Commission.The PennsylvaniaSupreme Court held that the zoningprovisions of the Act were an unconstitu-

tional delegation of legislative power tothe Gaming Commission.

The Act contained numerous,detailedprovisions providing for the issuance andregulation of licenses.The Act providedfor a limited number of gaming licensesin the state, and also included provisionsfor the Gaming Commission to licensethe sites for each casino license.The Actempowered the Gaming Commission inits discretion to preempt local zoningordinances in connection with approvalof a gaming site license;however, theaffected municipality was given the rightto comment upon the Commission’ssiting plan.

The Commonwealth argued that thisprovision, read in conjunction with theextensive provisions for the issuance ofgaming licenses in the Act,established asufficient standard to withstand the dele-gation attack;and that the Act establishedbasic policy and set primary standards,which the Commission was merelycarrying out.

The Supreme Court acknowledgedthat its precedents recognized that broaddelegations were permitted as long as thelegislature made basic policy.However,the court explained that legislation mustcontain adequate standards to guide theagency and the courts in reviewingagency action,even though the legisla-ture has set the basic policy. In thepresent case, the Pennsylvania legislatureestablished basic policy regardinggambling and the issuance of licenses,and also established the basic policy thatthe Commission could overrule localzoning ordinances.

However, the Supreme Court notedthat, although the Act provided for inputfrom local municipalities on issues ofsiting of casinos, the matter of location ofcasino sites in Pennsylvania was leftentirely to the discretion of the Commis-sion.The court could find no standardsor principles anywhere in the Act thatprovided guidance about how theCommission was to exercise its authorityto license specific casino sites in Pennsyl-

News from the States

* Administrative Law Judge, Illinois Depart-ment of Employment Security;Co-ChairState Administrative Law Committee; andContributing Editor.1Professor of Law Emeritus, UCLA LawSchool; Section Vice Chair; and AdvisoryBoard Chair.2Director,Widener Law & Government Insti-tute, Harrisburg PA. continued on next page


vania.Thus the court held that the Act’szoning provisions were an unconstitu-tional delegation of legislative power tothe Commission, severed those provi-sions from the balance of the Act, andaffirmed the constitutionality of the Act.

In the Gaming Act, the Pennsylvanialegislature attempted to use the KennethCulp Davis approach that substitutesprocedural safeguards in legislation toprotect against arbitrary agency action,such as the requirement for agency rule-making to establish standards toadminister a regulatory statute, in place ofthe traditional delegation standards.

The provision in the Act for commenton the Gaming Commission’s sitingdecisions by any affected municipalityconstitutes an attempt to create a proce-dural safeguard.The PennsylvaniaSupreme Court was unwilling to recog-

nize that this provision constitutedadequate protection against arbitraryGaming Commission behavior.

The court was correct. In the presentcase, the procedure that the legislaturecreated was inadequate protection againstarbitrary commission behavior because,although the local municipality couldcomment, there was no GamingCommission duty to read or to accordany weight to municipal comment.Moreover, the Gaming Commission wasnot instructed to establish or create anyprinciples for siting; the discretion of thecommission was totally unfettered.

Drafting Committee for theModel State APA

Those interested in the Model StateAPA have been asked to submit theirideas to Professor John Gedid, reporter

for the drafting committee.You areencouraged to check out the latestdraft as well as comments and who isinvolved in this project by going tohttp://www.nccusl.org/Update/CommitteeSearchResults.aspx?committee=234.

State Administrative LawCommittee Seeking Input on Bar Networking

The State Administrative LawCommittee is also seeking input on how we can network better withcommittees of State bar associations sothat all of us can benefit from the experiences in the States.A survey isavailable at www.IAALJ.org for allinterested in giving information to establish a network and resource list.

News from the States

rights:“In the absence of express statutory language, thiscourt has looked to whether or not the alleged property hadthe hallmark rights of transferability and excludability, whichindicia are part of an individual’s bundle of property rights.”

The peanut quotas constituted property rights becausethey could be transferred to others (as through the leases),and they could be protected from intrusion by others.Various limitations on transfer (e.g., to farms in the samecounty) were comparable to legislative restrictions onfirearm or alcohol ownership and did not prevent the quotasfrom being property rights. Quotas were distinct fromfishing licenses (which do not constitute property rights)because their values are fixed once they are allocated.Theissuance of more fishing licenses reduces the value of theoriginal license, but once a quota is allocated there is a fixedpayment, creating what the court termed “a market exclu-sive to the quota holder….The peanut quota holderspossessed an excludable interest, because the peanut quotaprogram isolated their particular interest from competition.”

Having scaled that cliff, the plaintiffs discovered the viewwasn’t really worth the effort.Their property right was not compensable. Since “the peanut quota is entirely the product

of a government program unilaterally extending benefits tothe quota holders, and nothing in the terms of the statuteindicated that the benefits could not be altered or extin-guished at the government’s election,” Congress mayeliminate the value of the quotas without providingcompensation. Noting property concepts such as a lack of“vesting” in the property and the absence of “investment-backed expectation of maintaining a continuing right to theproperty,” the court emphasized that unless Congress hasmade a property right irrevocable, it retains the power toamend legislation and eliminate benefits that it had previ-ously created.

The net result is that the quota holders have the samestatus as the welfare recipients in Goldberg v. Kelly. For some-what different reasons, each group has a property interest inthe government-created benefit, but neither could claim ataking if the interest were eliminated through later legisla-tion. On the other hand, individuals in both groups areentitled to procedural due process before government couldwithdraw their particular benefit without changing theunderlying statutory scheme.

News from the CircuitsContinued from page 22

OFFICERS AND COUNCIL

OfficersChair: Eleanor D. Kinney *

Chair-Elect: Daniel E.Troy *Vice Chair: Michael R.Asimow*

Secretary: James W. Conrad, Jr.*Budget Officer: Daniel Cohen*

Asst.Budget Officer: William S. Morrow*Section Delegates: Judith Kaleta*

Thomas M. Susman*Last Retiring Chair: Randolph J. May*

* Executive Committee MemberCouncil

Member 2006: Myles E. EastwoodKenneth G. HurwitzSharan L. LevineRichard W. Parker

Member 2007: Bernard BellKatie KunzerRonald SmithWendy Wagner

Member 2008: Michael HerzNina Elizabeth OlsonRichard StollAnn Marshall Young

Ex-OfficioState Administrative

Law: Paul AfonsoJudiciary: A. Raymond Randolph

Legislative Branch: Consuela WashingtonAdm. Judiciary: Lois F. Oakley

LiaisonsABA Board

of Governors: Mark AgrastYoung Lawyers Div.: Luke ReynoldsLaw Student Division: Nicole Bernabo

ADMINISTRATIVE PROCESS COMMITTEES

Adjudication Co-Chairs: James F. Flanagan

Ann Marshall YoungConstitutional Law and Separation of Powers

Co-Chairs: Bernard BellJay P. Lefkowitz

Corporate CounselChair: Richard J.Wolf

Dispute ResolutionChair: Charles E. Pou, Jr.

E-RulemakingCo-Chairs: Richard W. Parker

Peter StraussGovernment Information and Right to Privacy

Chair: Steve VieuxJudicial Review

Chair: William S. Jordan, IIILegislative Process and Lobbying

Chair: William V. LuneburgRatemaking

Co-Chairs: Steven A.AugustinoSusan Court

Regulatory PolicyCo-Chairs: H. Russell Frisby, Jr.

Sidney A. ShapiroRulemaking

Co- Chairs: Michael HerzRichard Stoll

State Administrative LawCo-Chairs: H. Lane Kneedler III

Edward J. Schoenbaum

GOVERNMENT FUNCTIONS COMMITTEES

AgricultureCo-Chairs: Robert G. Hibbert

Christopher R. KelleyPhilip C. Olsson

Antitrust and Trade RegulationChair: Mike Cowie

Banking and Financial ServicesCo-Chairs: Charlotte M. Bahin

Warren BelmarBenefits

Co-Chairs: Rudolph N. PattersonJodi B. Levine

Beverage Alcohol PracticeChair: Richard M. Blau

CommunicationsChair: Ralph B. Everett

Consumer Products RegulationCo-Chairs: David Baker

Peter WinikCriminal Process

Chair: David FrullaDefense and National Security

Co-Chairs: Thomas E. Crocker, Jr.Lynne Zusman

ElectionsCo-Chairs: Trevor Potter

Susanne S. RomeroEnergy

Co-Chairs: Kenneth G. HurwitzPatrick McCormick

Environmental and Natural Resources Regulation

Co-Chairs: Blake BilesJames O. Neet

Food and DrugCo-Chairs: I. Scott Bass

Nick LittlefieldGovernment Personnel

Chair: Joel P. BennettHealth and Human Service

Chair: Christine Meis McAuliffeHomeland Security

Chair: Lynne ZusmanHousing and Urban Development

Chair: Otto HetzelImmigration and Naturalization

Co-Chairs: Maria Pabon LopezAnna Williams Shavers

InsuranceChair: Janet Belkin

Intellectual PropertyChair: Kenneth R. Corsello

International LawChair: Charles H. Koch

International Trade & CustomsChair: Leslie A. Glick

Labor and EmploymentCo-Chairs: Marc A.Antonetti

Robert J. HickeyOmbuds

Chair: Nina OlsonPostal Matters

Chair: Robert BrinkmannPublic Contracts and Procurement

Chair: Sallyanne PaytonSecurities, Commodities and Exchanges

Chair: Alan L. DyeTransportation

Co-Chairs: Thomas Newton Bolling Linda Lasley

Treasury, Revenue and TaxChair: James R. Hagerty

Veterans AffairsCo-Chairs: Ronald Scholz

Ronald SmithBarton F. Stichman

SECTION ACTIVITIES COMMITTEES

ANNUAL AWARDSSubcommittee on Outstanding Government Service

Co-Chairs: Jodie Bernstein

Fred EmeryCynthia Farina

Subcommittee on ScholarshipCo-Chairs: Jonathan Cedarbaum

David C. FrederickDaniel R. OrtizDaniel Rodriguez

European Union ProjectChief Reporter: George Bermann

Asst Chief Reporters: Charles KochJim O’Reilly

Fundraising Chair: Eleanor KinneyProject Chair: Neil Eisner

FellowsChair: Paul Verkuil

Interstate Compact ProjectCo-Chairs: Kent Bishop

Jeff LitwakWilliam S. Morrow, Jr.

Membership and OutreachChair: Renee Landers

NominationsChair: Bill Funk

Pro BonoCo-Chairs: Lori Davis

Christine MonteProfessional Education

Co-Chairs: Susan Beth FarmerJack Young

PublicationsChair: Anna Shavers

Administrative and Regulatory Law NewsEditor-in-Chief: William S. Morrow, Jr.

Contributing Editors: Yvette Barksdale Robin Craig William Jordan Ed Schoenbaum

Board of Editors: Michael Asimow, ChairRobert AnthonyWarren BelmarDaniel CohenJohn CooneyCynthia DrewBill FunkPhilip HarterJim O’Reilly

Administrative Law ReviewEditor-in-Chief: Josh E.Adrian

Managing Editor: Adam Bolter

Developments in Administrative Law and Regulatory Practice

Editor: Jeffrey S. LubbersSeasonal Meetings

Fall Conference: Kathleen KunzerSharan Levine

Midyear Meeting: Cynthia Drew Spring Meeting: Christine FranklinAnnual Meeting: Janet Belkin

Sponsorship Chair: Richard Stoll

Young Lawyers and Law Student Outreach

Co-Chairs: Christine MonteDaniel OrtizDaniel B. Rodriguez

AD-HOC COMMITTEES

Review of Recruitment of ALJ’s by OPMChair: John T. Miller

OFFICERS, COUNCIL AND COMMITTEE CHAIRS

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Washington, DCAmerican BarAssociation

Volume 31, Number 2, Winter 2006Published by the Section of

Administrative Law and Regulatory PracticeAmerican Bar Association

740 15th Street, NWWashington, DC 20005

ADMINISTRATIVE & REGULATORY LAW NEWS

An Interpretive Guide to the Government in the Sunshine Act, Second Editionfrom the ABA Section of Administrative Law and Regulatory Practice

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For more information, or to order, visit our website www.ababooks.org or call (800) 285-2221.

This long-awaited revision of the authoritative 1978 Interpretive Guidethoroughly analyzes the Government in the Sunshine Act in the light ofagency and judicial experience since its enactment in 1977. A definitiveupdate of this leading commentary on the Act and its history, this newedition examines major Sunshine Act case law, agency practices and legalliterature of the past 28 years. It also analyzes the impact of this federalopen meeting law, explains how agencies post-September 11 are reconcil-ing new security requirements with their Sunshine Act obligations, posesissues for further study and recommends some reforms to the agencies and the Congress.

So whether you are a government lawyer, a Member of Congress, anadministrative law private practitioner, corporate counsel, a judge, libraryor anyone concerned about open government, you cannot afford to bewithout this comprehensive work. Order your copy today.

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By Richard K.Berg, Stephen H.Klitzman and Gary J.Edles

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