msulawstudentbar.files.wordpress.com · Web viewOn the first question, ex parte contacts themselves are generally legal. One exception is that the Constitution (via the Due Process

Administrative Law Outline Spring 2020

Administrative Law - Admin law deals with the laws and standards that constrain agency action (including the

Administrative Procedure Act [APA]) - Agencies perform tasks that closely resemble legislation (prospective, general applicability) and

adjudication (retrospective, discrete application) - Rule: ways of giving advance notice to the subjects of their authority how they will proceed in

certain circumstances – telling people what the agency thinks the law means to they can follow it

- Always look to the agency’s statute first, then APA o Statute controls over APA

- Themes: o Accountability: agencies make laws/legislation – how to hold accountable o Rule by experts: creates problems of tunnel vision o Legitimation through process: independent judges/how to replicate protections

- Executive Agencies and Independent Agencies o Executive:

Under the control of the president President can fire/can tell the, to do a specific thing or be fired

o Independent: President doesn’t have as much control over – restricted from removing (may

be restrictions of firing, have to have cause/reason) – free standing Run by a group (of commissioners) Terms can be staggered Restrictions on who can be appointed (dem v. rep)

- Agencies Actionso Rulemaking (legislation)

Prospective and general Tells you going forward that this is what you need to do Applies to everyone Must have adequate reason why the rule is adopted Subject to judicial review Need to follow procedural requirements applicable to rulemaking or not valid

o Adjudicating (judicial action) Retrospective and deals with discreet parties Something specific happened in the past to these two parties, what does the

law require we do about it Same force of law as court decision – limited to functions in its enabling act Subject to judicial review to ensure consistent with enabling act and that the

agency obeyed applicable procedures in reaching its decision o Investigating

Demanding things are reported to the agency/snooping around Agency power subject to judicial review

- Substance v. Procedure o Substance: Issues of substance (i.e. what is the right result, what should we do, should

this person be sanctioned) – the agency gets extraordinary amount of deference from Art III courts reviewing them Court will give deference (aka, you will lose)

o Procedure: Agency does not get the same type of deference as substance

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- Broad third-party participation in admin law – be aware of interested third parties

Rulemaking- 553: the procedures an agency must follow when engaged in rulemaking - Need not use rulemaking procedures if:

o (1) military or foreign affairs; or o (2) matters relating to agency management or personnel or to public property, loans,

grants, benefits, or contracts - Informal rulemaking

o 553 established 3 steps (1) agency is required to publish notice of proposed rule in the federal register

with two exceptions I) interpretive rules, general statements of policy, or riles of agency

organization, procedure, practice Ii) when the agency has good cause for bypassing the notice stage of

rulemaking (2) agency must give interested persons an opportunity to participate in the

rulemaking through submission of written data, views, or arguments with or without opportunity for oral presentation

(3) the agency must incorporate in the rules adopted a concise general statement of their basis and purpose

- Formal rulemaking o Sections 556-557 o Must undertake the same type of trial that it would for formal adjudication o 553(C) test for when agency must use formal rulemaking

Required when rules are required by statute to be made on the record after an opportunity for agency hearing.

Look to original mandate – if it requires it to adopt a rule on the record after opportunity for agency hearing, then must use procedures in 556-557

- Sources of the rules/what drives the agencies to make the rules (or to keep rules from being made)

o (1) agencies own statute/mandate o (2) when other statute authorizes to make a rule (doesn’t require) and that agency

wants to (not mutually exclusive processes) A) bottom up: staff recommendations, something they notice/public news/what

other agencies do Technical staff consults the literature, data, experts, and what other

governments are doing, and makes recommendations B) top down: head of agencies want something (political appointees) –

politically accountable – might be trying to please different people than the lower downs

Political reasons for making a new rule come from the head of the agency, reflecting the political priorities of the agency

o (3) other statute authorizes them to make a rule and someone wants that agency to make that rule

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Outside-in approach : Can work through either bottom up or top down, can be public, special interests, or public interest, lobbyists, president, congress, media

Can feed the bottom-up and/or top-down modes by exercising pressure through: making connections/suggestions to staff; or playing pressure politics through government; or the media

- Lobbying o Steps to take

Look at the agency mandate Existing regulations for what you are looking for? Agency approach:

Top down v. bottom up Need to find the right people within the agency that have the right

combination of authority and influence Reach out to similar companies/groups in the area/industry to make

coalition/association Be aware of who will be against this Appeal to the agency’s own interest Last resort : petition for rulemaking

553e : each agency shall give an interested person the right to petition for the issuance, amendment, or repeal of a rule

555b : requires the agency to act promptly 555e : must explain why

o Not legal arguments – maybe technical o If you canty think of anything nice to say, say it anyways o Some practical points on effective lobbying:

(1) The agency is not a courtroom; (2) Be on the level about your interest, but realize that if all you are saying is

that you want the rule changed because it is hurting you, the agency is unlikely to be sympathetic--tell them why your proffered action is good for the public and for the agency and consistent with the agency’s statutory mandate;

(3) Form a broad coalition so as to blunt any sense that you are only pursuing self-interested goals;

(4) Be technical. If you have science on your side, the bottom-up approach can be a powerful one.

- OMB: Office of Management and Budget - Petitions for rulemaking:

o 553(e) that prompt notice shall be given of the denial in whole or in part of a written application, petition, or other request of an interested person made in connection with any agency proceeding and the notice shall be accompanied by a brief statements of the grounds for denial

Filing a petition is a way to force some action out of an agency if it is otherwise reluctant

o Pursuant to the APA (5 U.S.C.) § 553(e), any interested party can petition an agency to initiate rulemaking.

The agency must promptly respond (§ 555(b)) and, if the petition is denied, give an explanation (§ 555(e)).

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As a practical matter, though, courts have been reluctant to give the “promptness” requirement many teeth.

Delays are either accepted or given only weak stimulus from the court. When the court does act, it guarantees only that the petition is answered, not that it is granted.

Still, even if the petitioner loses, it might still force the agency to put its cards on the table, or provide other helpful external benefits.

o Agency inaction 551(13) "Agency Action": includes failure to act 706 -- the reviewing court shall compel agency action unlawfully withheld or

unreasonably delayed o When determining whether an agency’s delay is so egregious as to warrant

mandamus, courts consider that: (1) the time agencies take to make decisions must be governed by a rule of

reason; (2) where Congress has provided a timetable or other indication of the speed

with which it expects the agency to proceed in the enabling statute, that statutory scheme may supply content for this rule of reason;

(3) delays that might be reasonable in the sphere of economic regulation are less tolerable when human health and welfare are at stake;

(4) the court should consider the effect of expediting delayed action on agency activities of a higher or competing priority;

(5) the court should also take into account the nature and extent of the interests prejudiced by the delay; and

(6) the court need not find any impropriety lurking behind an agency lassitude in order to hold that agency action is unreasonably delayed

o Agency has to show they made a good faith effort - DC Cir. Has traditionally been recognized as the court to go to for administrative law cases

because so many agencies are located in DCo Many statutes assign review of agency action to that court in order to provide

uniformity under the aegis of an expert court o DC precedents are often accorded extra weight

- In determining the constraints facing the actions of a particular agency – look to the statute that governs the agency first and then to the APA if necessary

- Congress may direct an agency to promulgate rules on a certain subject. It may provide a time limit for the rulemaking, though courts do not always enforce these strongly unless the statute provides explicit penalties for failure to meet deadlines

- Denial of a petition o Have to ask if the denial was lawful o Common justification: it’s not important enough to use resources at this time

§706. Scope of review -- KNOW THIS AND WHICH ONE TO USE6 possible standards of review:

- (a) Arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law - (b) contrary to constitutional right, power, privilege, or immunity - (c) in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; - (d) without observance of procedure required by law - (e) unsupported by substantial evidence in a case subject to sections 556 and 557 or

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otherwise reviewed on the record of an agency hearing provided by statute - (f) Unwarranted by the facts to the extent that the facts are subject to trial de novo by

reviewing court

- b/c/d: questions of law = ALL DE NOVO - A: questions of fact = DEFERENTIAL - E: question of fact = deferential - F: pretty much never used

Anything an agency does can be challenged in court by someone who has standing and is reviewable under the arbitrary and capricious standard if challenging decision, don’t want AC review, because its deferential, want to try and get de novo if possible

- Challenging the denial of a petition is a question of fact Asking if the denial of the petition was arbitrary and capricious

- What to look for: o Do the facts have some basis in the record?

Conclusions have to be from somewhere in the record for the court to be okay

o Did the agency adequately explain that facts that it relied on? Is the record grounded

Not asking if they made the right decision or if they based on stuff that is actually there and made an adequate explanation – the court doesn’t have to agree with the decision.

- Courts may compel an agency to institute rulemaking proceeding only in extremely rare instances – The scope of review on an agency decision to deny a request for rulemaking is very narrow

o Review is focused on ensuring that the agency adequately explained the facts and policy concerns that it relied upon and that the record supports the facts considered

- Remedy: agency is obligated to examine the relevant data and articulate a satisfactory explanation for its action including a rational connection between the facts found and the choices made – has to be ground in the record

Know the difference between questions of law and facts Know the difference between procedural and substantive “arbitrary and capricious” for the standard of review “”

APA rulemaking procedures: APA 553 – INFORMAL RULEMAKING Notes (a)This section applies, according to the provisions thereof, except to the extent that there is involved—

(1)a military or foreign affairs function of the United States; or(2)a matter relating to agency management or personnel or to public property, loans, grants, benefits, or contracts.

(a1) public does not need to be Involved with military/foreign affairs

(a2) more like the government acting like a benefactor

- Congress or the agencies themselves typically require these procedures anyways, through specific statutes superseding the APA, or via self-

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imposed procedural rules three things can happen:

(1) agency can decide to do notice and comment

(2) congress can say the agency has to do notice and comment

(3) they don’t have to do anything and skip notice and comment

(b)General notice of proposed rule making shall be published in the Federal Register, unless persons subject thereto are named and either personally served or otherwise have actual notice thereof in accordance with law. The notice shall include—

(1)a statement of the time, place, and nature of public rule making proceedings;(2)reference to the legal authority under which the rule is proposed; and(3)either the terms or substance of the proposed rule or a description of the subjects and issues involved.Except when notice or hearing is required by statute, this subsection does not apply—

(A)to interpretative rules, general statements of policy, or rules of agency organization, procedure, or practice; or(B)when the agency for good cause finds (and incorporates the finding and a brief statement of reasons therefor in the rules issued) that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.

Notice - telling people what the

proposed rule is about - 3A and B: exceptions

(c)After notice required by this section, the agency shall give interested persons an opportunity to participate in the rule making through submission of written data, views, or arguments with or without opportunity for oral presentation. After consideration of the relevant matter presented, the agency shall incorporate in the rules adopted a concise general statement of their basis and purpose. When rules are required by statute to be made on the record after opportunity for an agency hearing, sections 556 and 557 of this title apply instead of this subsection.

Comment - If notice isn’t required, then

comment isn’t required (B exceptions)

(d)The required publication or service of a substantive rule shall be made not less than 30 days before its effective date, except—

(1) a substantive rule which grants or recognizes

Publication requirement - Telling people what the final

rule is about - does not apply to interpretive

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an exemption or relieves a restriction;(2) interpretative rules and statements of policy; or(3) as otherwise provided by the agency for good cause found and published with the rule.

rules and statements of policy or good cause

- applies to procedural rules (even though they don’t need notice and comment

(e)Each agency shall give an interested person the right to petition for the issuance, amendment, or repeal of a rule.

Right to petition

- Good cause exception: requires an agency to find that notice and public procedure are impracticable, unnecessary, or contrary to the public interest – read very narrowly

o Impracticable: situation in which the due and required execution of the agency functions would be unavoidably prevented by its undertaking public rulemaking proceedings

o Unnecessary: unnecessary so far as the public is concerned, as would be the case if a minor or merely technical amendment in which the public is not particularly interested were involved

o Public interest supplements the term impracticable or unnecessary; it requires that public rulemaking procedures shall not prevent an agency from operating and that on the other hand, lack of public interest in rulemaking warrants an agency to dispense with public procedure

- Statutory deadlines o Be skeptical o Congress could have said they don’t have to worry about notice and comment o The fact they put a time limit on the agency and didn’t address notice and comment,

congress might have wanted notice and comment - To what extent to which the rule reflects a substantial judgment

o What is the intention?o What are they trying to do here? o Vending machine v. applying in person for guns example

If you are changing the criteria by which people are going to be judged – substantive

- The APA does not require a governmental agency to engage in notice-and-comment procedures before promulgating rules that authorize the rejection of a license application with no opportunity to amend the application

- Changing criteria to meet is substantive - Substantive v. procedural rules

o Distinguish Substantive value rule

o If in middle, convey not easy case, give best arguments on both sides, throw hands up, move on

- Remedy: didn’t go through notice and comment, you sue, you win, they do notice and comment – doesn’t mean that the final composition of the rule will be changed. – same exact thing, but takes longer

- A person who petitions for rulemaking and is denied by the agency can seek review of the decision in an Article III court.

o The court will review the agency decision under the deferential “arbitrary and capricious” standard.

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o Rather than ask whether the petition should or should not have been granted, the court will just ask

(1) whether the agency gave a satisfactory explanation for its action, and (2) whether that explanation reflected a rational connection between the

agency’s decision and the facts in the administrative record. o Thus, the agency might prevail even if the court would have concluded that a

preponderance of the evidence supports granting the petition (had that been the court question asked).

o The agency’s decision just needs to be reasonable. (On the other hand, if the explanation wasn’t good enough, the opposite might occur too: an agency could have a preponderance on its side but lose the case because its explanation was inadequate.)

o In any case, the remedy is generally a remand for a proper explanation; the Article III court won’t itself grant a petition.

- APA (5 USC) § 553 on informal rulemaking contains several procedural requirements: o (b) notice of proposed rulemaking,o (c) public comment, o (d) publication of the final rule, and as discussed last week, o (e) openness to petitions.

- Procedural rules are exempt from notice and comment. o The standard for distinguishing procedural rules (exempt from APA notice and

comment) from substantive rules (not exempt) is muddled and frustrating. o Most courts just try to determine the extent to which the rule affects the “primary

conduct” of the regulated entity as opposed to merely affecting how the entity presents its conduct.

o The more that the former (primary) conduct is affected, the more likely the rule is to be considered substantive.

- Instances where the agency for good cause finds notice, comment, and publication to be “impracticable, unnecessary, or contrary to the public interest” are potentially exempt as well.

o This “good cause” exception is not read as broadly as it sounds in (5 USC) § 553, because doing so would give the agency an incentive to overuse it, and the exception would swallow the rule.

556 and 557: formal rulemaking 552: freedom of information act

- if an agency fails to public the rule in the federal register, unless persons have actual notice of the rule, they may not be adversely affected by it

Formal Rulemaking: - how rulemaking used to be done before the APA - trial like procedure: hearing preceded over by hearing officer who admits evidence in a formal

way, may be cross examined, builds a record, bases on the evidence in the record, the agency decides what to do

- “on the record” – limited to the evidence from the trial, literally cannot get anything else asides from info from the hearing

- “after an opportunity for agency hearing . . . on the record” o Need both sentences

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- When statutes require rules be made on the record after opportunity for agency hearing = formal

Hybrid rulemaking- Informal rulemaking plus requirement for hearing

Vermont Yankee Nuclear Power Corp. Natural Resources Defense Council, Inc. Scotus, 1978

- Rule: reviewing courts are generally not allowed to impose additional procedural requirements on administrative agencies’ rulemaking process

o Whatever the agency’s stature says is what you do/what the agency imposes on themselves for procedural rules

Exceptions Absent constitutional constraints Extremely compelling circumstances

- Facts: NRDC argued that the absence of discovery or cross-examination rendered the proceedings inadequate.

- Issue: are reviewing courts generally allowed to impose additional procedural requirements on administrative agencies’ rulemaking processes? No

- Reasoning: o First, if courts were to continually review agency proceedings to determine whether the

procedures employed were perfectly tailored to reach what the court considered to be the correct result, judicial review would be unpredictable.

o Second, courts only have access to the record produced at the hearing, not the information available to the agency when it made its decisions regarding what procedures to employ.

o Third, such review would fundamentally misconstrue the nature of the standard for judicial review of agency rulemaking.

- Judicial branch cannot add to the procedural burden the agency pfaces when it makes a rule - Adjudicative facts: facts concerning the individual

o Kinds of facts that should not be resolved to the individuals detriment without giving the individual an opportunity to be heard with respect to those facts

- Legislative facts: o General facts that help a government institution decide questions of law, policy, and

discretion o Constitution permits the institutions of government to resolve disputed legislative facts

by relying on sources other than the individuals who are affected by resolution of those facts

Informal rulemaking requirements - Notice requirements

o 553(b): General notice of proposed rulemaking shall be published in the federal register – must include:

Statement of time, place, nature of the rule making proceedings Reference to the legal authority under which the rule is proposed Either the terms of substance (the exact proposed language or summary of

proposed rule) or a synopsis

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o Portland Cement: also have to include data and methodology to get to that point – what is the proposal based on and how did they get there? Explain the legal and factual basis

- Test: notice is adequate if the changes in the original plan "are in character with the original scheme" and the final rule is a logical outgrowth of the notice and comments already given

o If the final rule materially alters the issues involved in the rulemaking or, if the final rule substantially departs from the terms of substance of the proposed rule, the notice is inadequate

- If a statute directs the agency to make rules “on the record after opportunity for an agency hearing,” then the agency must use the formal rulemaking process (5 U.S.C. §§ 556, 557).

- If the statute specifies other specific procedures, hybrid rulemaking will be used. Otherwise, pure informal rulemaking will be used (5 U.S.C. § 553).

- The agency can always add procedures voluntarily if it sees fit, as long as its statute doesn’t preclude it.

- In Vermont Yankee, the Supreme Court said that courts should not add more mandatory agency procedures “absent constitutional restraints or extremely compelling circumstances.”

- Generally speaking, therefore, the procedures mandated by the agency’s own statute will usually be the limit.

- APA notice requirements for rulemaking (both formal and informal) are simple: notice must include a notice of proposed rulemaking (NPRM) in the Federal Register which contains notice of the statutory basis for the rulemaking; the time, place, nature, etc., of any public proceedings; either the gist of the proposal or (typically, but not mandatorily unless the agency statute specifies it separately) the full text of the proposed rule; and the data and methodology underlying the proposal.

o (The data and methodology requirement comes from case law, not the APA, despite Vermont Yankee.)

- The main conflict over notice occurs when a rule changes so much between the proposed version and the final version that an interested party effectively had no notice of the final version.

o How much change is too much? o Many courts use the “logical outgrowth” test to determine whether notice is

inadequate: was the final rule a logical outgrowth of the proposed rule? A clearer way to look at the notice question is to ask whether the proposed rule put the issues or interests of a party “on the table.”

o That is, should the party have known that its interests were implicated by the impending rule?

o Even though they don’t themselves provide notice, other parties’ comments on an issue can be good evidence that a particular issue was on the table.

- Notice problems of the sort just described come not from the final rule doing the opposite of a proposal (after all, the proposal poses the question of whether or not to do something), or doing more or less of the thing the proposal proposes, but rather from the final rule doing something different in kind from the proposal.

Opportunity for comment - 553c required agencies to provide interested persons with an opportunity to comment through

submissions of written data, views, or arguments - Formal rulemaking: specific prohibitions on ex parte communications

o Not in informal

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- 60d is common for comments - Ex parte communication – Check the sources

o Due process clause of the constitution – probably wont impose limits, but it could o APA: no issue with informal, issues with formal o Self-imposed agency procedure rules o Case laws

Home Box Office v. Federal Communications Commission, DC Cir, 1977 - Ex parte communications with an agency prior to the issuance of a formal notice of rulemaking

must be disclosed to the public in some form if such communications form the basis for an agency action.

Sierra Club v. Costle, DC Cir, 1981 - The Clean Air Act affords the Environmental Protection Agency discretion in docketing written

and oral communications from the post-comment period. - Centrally relevant materials need to be in the docket so that the record reflects what the

decision was actually based on - Decision needs to be based on what is in the record

o If formal communication: put on the record

Statement of basis and purpose: APA requires the final rule to have a basis of statement and purpose in the preamble of the rule – can help respond to a bunch of comments, chance to get a bunch of info out early, scare people away, show reasoning

Hybrid Rulemaking Requirements: statutory requirements - National Environmental Policy Act (NEPA)

o Requires agencies to compete an environmental impact statement (EIS) before engaging in activities (including rulemaking) that may have significant impact on the human environment

o Needs to be part of the record o Strong judicial review provision : if the statute tells you to do something, matters what

the statute says will happen to you if you don’t o Court will issue an injunction if they should have done an EIS and didn’t

- Regulatory flexibility act (Reg-Flex) o (RFA) requires agencies to create a regulatory flexibility analysis whenever they propose

a rule that may have significant economic impact on a substantial number of small businesses, organizations, or government

o Impact on small businesses or small governments o Judicial review

- Paperwork reduction act o Requires agencies to engage in a notice and comment procedure prior to imposing any

reporting or record keeping requirements on 10+ persons o Agency must determine that the collection of info is necessary for the proper

performance of the functions of the agency, not unnecessarily duplicative of information otherwise available to the agency, take account of the particular problems of small entities, is written in plain language, and used information technology to reduce burden

- Data quality act (DQA)

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o Required agencies to issue guidelines that ensure and maximize the quality, objectivity, utility and integrity of info that they disseminate, to establish an administrative process that allows affected persons to seek and obtain correction of information that does not meet those benchmarks and to report yearly to the Office of Management and Budget (OMB) concerning the receipt and resolution of complaints

o 2004, OMB require regulatory agencies to have independent scientists peer review - Executive order requirements

o Executive order is a management directive issued by the president with the expectation that the agency administrators will comply (or be fired)

o No judicial review

Executive order 12,866 - Not enforceable in court - Applies to significant regulatory actions (major rules) (defined as: something with a significant

economic impact - annual impact of over $100m) - Requires the agency must submit to OIRA for comment (part of the office of management and

budget- - part of the white house staff) the cost-benefit analysis and that the benefits exceed the costs or that you cannot certify that but the statute is requiring you to do this

- Puts the cost-benefit analysis in the record- Sends through OIRA -- gives them the power to ask questions

1. Comment is discussed in (5 U.S.C.) § 553(c). Typically, comments are written. The APA does not provide any minimum or maximum length for comment periods, but some individual statutes do. A typical period is 60 days, but agencies frequently extend the comment period when doing so seems helpful.

2. Formal rulemaking does not allow for ex parte communications (which we will discuss more in Chapter 3), but the APA places no explicit restrictions on ex parte communications in informal rulemaking (IRM). In IRM, ex parte communication issues involve two questions: what contacts can take place; and which contacts must be formally disclosed?

3. On the first question, ex parte contacts themselves are generally legal. One exception is that the Constitution (via the Due Process Clause) restricts ex parte contacts in those rare IRM cases that involve parties competing adversarially for a limited privilege (e.g., a single TV license). Agencies might also face limits to ex parte communications from Congress (in the agency’s own statute) or from themselves (via procedural rules).

4. As to the second question, some courts have required disclosure of ex parte communications in IRM. While the more restrictive of such case law is suspect under Vermont Yankee, many agencies (and occasionally some courts) follow these restrictive rules anyway.

5. In practice, ex parte communications are only an issue in IRM where they actually shaped the substantive decision reached by the agency. Courts want the record to include the grounds (the data and other technical bases) for the decision. That said, if technical information like this comes in through ex parte communications, the most that courts will require of the agency is to disclose those communications and possibly give others an opportunity to comment. But if all of the relevant data is already reflected in the record, then political pressure to favor one set of technical arguments over another need not be docketed in this way, let alone set out for comment.

6. The APA requires a final rule to have a statement of basis and purpose in its preamble. Many statutes require it to also include responses to the comments, and because the preamble is an important source for courts reviewing the agency’s decision (analogous to legislative history, but

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even more important), agencies tend to err on the side of comprehensiveness, making these preambles lengthy.

7. Various supplemental rulemaking requirement statutes require agencies as part of the rulemaking process to consider--formally--the impact of a rule on certain things. Some examples with significant power to actually shape agency action are NEPA (environmental impact), RFA (small organizations), PRA (paperwork), and E.O. 12866 (cost-benefit analysis and centralized review). There are several other executive orders of a similar ilk, but unless they have strong judicial-review or institutional teeth, they don’t amount to much.

White House Oversight - OIRA serves as the focal point of White House oversight of the rulemaking process - OIRA role

o Oversee a genuinely interagency process, involving many specialists throughout the federal government

o When a proposed or final rule is delayed, and when the OIRA review process proves time consuming, it is usually because significant interagency concerns have yet to be addressed

o Costs and benefits o Highly technical process

- Idea to have all the major rules go through the white house (idea that the President isn’t just some other person)

- 12866: Cost benefit analysis What gets it into the office Main focus, inter-agency consultation Timely action, lots of documentation, explanation -- OIRA doesn’t do this

o Some people are way more critical of 12866 saying its too ad hoc and meddlesome. Second change for someone in the agency to get in there and mess with it -- not even limiting to major rules, most of what they are dealing with are the smaller stuff

- The common law of 13,563 o Determines the most important features of the current process of regulatory reviewo EO 12,866

- Ossification o Potentially 110 steps that can be applied to a rule o Rules take 4-8ys o Prevents flexible responses to problems

- Rulemaking takes a long time, but so does everything else, there is no way around that

Keep in mind: because of how burdensome the process is, how long it takes, tremendous incentive for agencies to avoid notice and comment if they can

Reg-Neg - The interest in Alternative Dispute Resolution (ADR) has lead to another hybrid rulemaking

process -- regulatory negotiations (reg.neg) - Agency and other parties with a significant stake in rule participate in facilitated face-to-face

interactions designed to produce a consensus

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- If a consensus is reached, it is published in the federal register as the agency's notice and proposed rulemaking, and then the conventional review and comment process takes over

- Negotiated rulemaking - Worked in limited cases, but typically avoids litigation

Judicial Review: Statutory Interpretation Chevron v. Natural Resources Defense Council, Inc, scotus, 1984

- If a statute administered by an agency is silent or ambiguous with respect to a specific issue, a reviewing court may not simply impose its own construction on the statute

- When a court reviews an agency’s construction of a statute, it faces two questions. First, the court must consider whether Congress directly addressed the precise question

at issue. If Congress has made its intent explicit in the statutory language, then both the

court and the agency must give effect to that unambiguous congressional intent.

Second, however, if the court finds that the statute is silent or ambiguous regarding the specific issue, the court must consider whether the agency’s action was based on a permissible construction of the statute.

- Chevron 2-step Court determines whether the statute clearly requires or forbids the agency's

interpretation -- if the statute does not clearly answer the question, moves to step 2 Determining whether the agency's interpretation is reasonable or permissible

-CHEVRON ALAYSIS Steps: - STEP 0) is this statute this agency's to interpret

Who is supposed to execute this statute or is it applicable for every/many agencies? No - no deference - stay with de novo

- STEP 1) Is there a gap or ambiguity? -- is the statutory term at issue ambiguous? If there is, congress wanted the agency to figure out what the statute means Idea that congress wants the agency to answer the questions If there is not a gap, then no chevron deference - stay with de novo

- STEP 2) Chevron deference If its theirs's to interpret and its ambiguous, chevon deference --> court will approve if its

reasonable (the agency wins as long as its interpretation is reasonable) Reasonableness test (is it in the circle?)

Is it a question of law or fact? - Law: start with de novo and then go through steps 0-2 - Fact: reasonableness/deference

King v. Burwell: 2015 - In extraordinary cases involving questions of deep economic and political significance, a court

does not grant an administrative agency Chevron deference. - If really important in terms of impact, be skeptical

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1. The reality of White House control of rulemaking is that it extends far beyond OIRA’s cost-benefit analysis process spelled out in E.O. 12866. OIRA acts as a conduit for input on a nearly-final rule from other interested entities within the administration.

2. Chevron is the most important case in modern administrative law. It establishes when courts reviewing agency rulemaking should defer to the way the agency interpreted the statute in its informal rule. Such agency interpretations are initially subject to de novo review, but Chevron potentially adds significant deference to that.

3. Chevron asks, as a preliminary matter, whether the statute is this agency’s to interpret. Therefore, Chevron does not apply (instead, undeferential de novo review applies) when an agency interprets another agency’s statute, or a statute that applies broadly to multiple agencies, or a statute in which Congress has withheld that interpretive authority from the agency.

4. After that, the Chevron test has two steps. Step one is to ask whether the statute is ambiguous or contains a gap that must be filled. If not, then the court gives no deference to the agency’s interpretation--the statute can have only one meaning; if the rule being reviewed shares that meaning, it is approved, and if it doesn’t share that meaning then the rule is struck down. That is, in essence, pure de novo review. If and only if the statute is ambiguous or has a gap, the court moves to step two.

5. If the court concludes that, despite the presence of a gap or ambiguity, Congress did not implicitly delegate interpretive authority to the agency, it might not proceed to Step 2 to accord Chevron deference. The court will be more skeptical about implicit delegation if the ambiguous phrase is a matter of “deep economic and political significance” (e.g., a large chunk of the nation’s health-insurance system).

6. Some judges look only to the plain meaning of the statute to gauge its ambiguity; others use canons of interpretation, or look more broadly to the spirit of a statute, or look to legislative intent and legislative history.

7. Step two of Chevron asks whether the agency’s interpretation of the statute is reasonable. Because the statute is ambiguous or has an intentional gap if we have gotten to this point, there are a range of possible reasonable interpretations. As long as the agency’s interpretation is within that range--even if the court might prefer another interpretation--the agency’s interpretation will be upheld. It is much less common for an agency to lose at step two than at step one.

8. The question in Chevron cases is the classic legal-process question: who decides? If Congress has given an agency authority (either explicitly by expressly delegating interpretive authority, or implicitly by just being vague), then it wants the agency--not the court--to resolve any ambiguities. While a court should defend a statute against unreasonable interpretations, it should also leave it to the agency to choose from among a range of acceptable interpretations.

9. The Supreme Court often ignores its own precedents and reviews agency interpretations of statutes using a more ad hoc process. For the purposes of this class, though, assume that courts will follow Chevron and its progeny as appropriate.

1. Court will not say what it thinks is the best interpretation, just if the choice was reasonable

Substantive Decisions - Substantive review: don’t have to look to the statute, look to the facts in the record- When an agency promulgates a rule it reaches 2 types of substantive decisions

- Determines on the basis of the evidence available to it, what are the relevant facts - Decides what type of rule, if any, is appropriate in light of the facts, choosing the

regulatory option that will best further its statutory mandate

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- Scope of review - 706 states the substantial evidence standard applies when an agency must comply with

sections 556-557 which involves formal rulemaking - Informal rulemaking, the arbitrary and capricious scope will normally apply - Congress sometimes requires the use of substantial evidence standard for judicial

review of informal or hybrid rulemaking - Make sure to check the agency's statutory mandate to determine whether it imposes a

difference scope of review on the agency's rulemaking - Substantial evidence

Instructs the court to uphold a rule if it finds the agency's decision to be reasonable or the record contains such relevant evidence as unreasonable kind might accept as adequate to support a conclusion

Does not require the court agree with the agency's conclusion, only requires that the agency's choice be a reasonable one, even if the court would have made another choice

Formal rulemaking Looks for reasonableness

- Arbitrary and capricious Requires the reviewing court to engage in a substantial inquiry, a thorough,

probing, in depth review to find arbitrariness the court must consider whether the decision was based on a consideration of relevant factors and whether there has been a clear error in judgement

Narrow review Looking at the record/decision reached Informal rulemaking - was the substance of the rule reasonable Is there an adequate explanation for their choice? In the circle of reasonableness

- Standards very similar - Ways to be arbitrary and capricious in informal rulemaking (state farm)

- Relying on a factors congress did not want you to rely on - Not relying on factors that congress did want you to rely on - Overlooking something obvious - Inadequate explanation - If its really stupid

- Hard look review: - Want to make sure the agency was making the rule and gave a hard look at the evidence

– agency needs to show adequate explanation of their decision An adequate explanation ensures that the agency gave it a hard look

REVIEW Sources/ideas where rules come from

o Lobbying o Inside agency

Top down Bottom up

o Often outside o Interest groups o Congresso President

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How petitioning for rulemaking is a way to get the ball rolling, don’t start with, start with lobbying o Have to respond o Long delays generally tolerated by court

Notice and comment rulemaking o Exceptions

Military Public benefits/contracts/grants

o Interpretative rules/policy statements o Procedural v. substantive rules o Notice o Logical outgrowth test o Comment o Ex parte communications o Publication o Hybrid requirements and hoops congress and the president have made

Judicial review of rule o Questions of law - de novo - maybe chevron o Questions of fact - A&C

Chapter 2 review: Rulemaking petitions:

o Each agency shall give an interested person the right to petition for issuance, amendment, or repeal of a rule

o Must respond o Within reasonable time o If reject, must explain why and have facts with basis in the record

Exceptions to rulemaking procedures o Section 553 contains the notice and comment procedures applicable to informal rulemaking

and it directs people to 556/557 if formal rulemakingo Exceptions:

Rules that concern military or foreign affairs functions, agency management or personnel, or public property, loans, grant, benefits, contracts

Specific exceptions: Rules of agency organization, procedure, or practice Interpretative rules, general statement of policy Other rules for which notice and public procedure and impracticable,

unnecessary, or contrary to public interest Rules of agency procedure

o JEM broadcasting: rule of procedure not "alter the rights or interest of parties, although it ay alter the manner in which the parties present themselves or their viewpoints to the agency

o Since procedural rules can have substantive impact is sufficiently grave so that notice and comment are needed to safeguard the policies underlying the APA

Informal rulemaking o Only subject to notice and comment required by 553 and must be accompanied by a

statement of basis and purpose when they are promulgated Formal rulemaking

o Must follow procedures from 556-557 - require a trial type proceeding to promulgate a ruleo Look to agency mandate if it triggers formal rulemaking

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Hybrid rulemaking o Executive orders can be an example of

Notice of proposed rulemaking (190)o Apa requires general notice of proposed rulemaking shall be published in the federal

register Opportunity for comment

o Section 553(c) requires agency to provide interest persons an opportunity to comment through submission of written data, views, or arguments

Ex parte contract o In formal rulemaking the APA places specific prohibition on ex parte communications

(communications made to decision makers in the agency outside of the prescribed and public procedures)

o Congress can limit Statement of basis and purpose

o 553(c) requires agencies after consideration of the relevant matter presented to incorporate in the rules adopted a concise general statement of their basis and purpose

o The more detailed/expansive statement of basis and purpose are primarily the result of court decisions that either set aside or remand to the agency rules that the courts found inadequately justified

Judicial Review o 706(2) of the APA established 6 grounds for a court to hold that a rule is unlawful

Arbitrary, capricious, abuse of discretion or otherwise not in accordance with law Contrary to constitutional right, power, privilege, or immunity In excess of statutory jurisdiction, authority, or limitations, or short of statutory right Without observance of procedure required by law Unsupported by substantial evidence in a case subject to §556 and 557 or otherwise

reviewed on the record of an agency hearing provided by statute Unwarranted by the facts to the extent that the facts are subject to trial de novo by

the reviewing court Statutory interpretation

o Interpretations are subject to judicial review under 706 - directs a court to hold unlawful agency action un now accordance with law and in excess of statutory jurisdiction, authority, limitations, or short of statutory right

o Chevron deference Chevron 2-step test

(1) court ask whether congress has directly spoken to the precise question at issue (and if so court must apply congress's statutory language) if vague/ambiguous go to step 2

(2) court will ask whether an agency's interpretation constitutes a permissible construction of the statute

Step one: would a reasonable person interpret o Avoidance of step 2

King v. Burwell: deep economic and political significance Substantive decisions

o When an agency promulgates a rule, it determines on the basis of the evidence available to it, what are the relevant facts, and then it decides what type of rule, if any, is appropriate in

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light of those facts, choosing the regulatory option that will best further its statutory mandate

Arbitrary and capricious v. substantial evidence Scope of review:

o 706 substantial evidence standard applies to formal rulemaking only unless congress says it applies

Adequate reasons o If any agency has not adequately explained its reasons for promulgating a rule, the court will

remand the rule back to the agency for a more adequate explanation o Normally an agency rules would be arbitrary and capricious if the agency has relied on

factors which congress has not intended it to consider, entirely failed to consider an important aspect of the program, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise

Hard look review o State farm requirement that an agency must established a rational connection between the

facts found and the choice (hard look review)

1. Section 706 specifies the standard of review for Article III review of the substance of agency action (questions of law were covered in the previous class). For informal rulemaking (and for informal adjudication, which we will cover in Chapter 3), we use the “arbitrary and capricious” standard. For formal rulemaking (or formal adjudication, which we will cover in Chapter 3), we use the “substantial evidence” standard. (For hybrid rulemaking, we use whatever the statute specifies.) Functionally, both standards are the same--looking for reasonableness. Despite the similarity of the standards as a logical matter, though, “substantial evidence” is seen as being a signal for slightly more searching review.

2. The informal rulemaking “record,” such as it is, consists of the notice of proposed rulemaking (NPRM), the final rule including its preamble, and any other materials used by the agency to reach its conclusion, such as comments and docketed ex parte communications.

3. In so-called “substantive review”--NOT questions of law/Chevron, but rather questions of fact regarding the actual outcome of the rule--the court will look to see (among other things) if the agency gave an “adequate explanation” for its decision. If the agency loses, the remedy is a remand for an adequate explanation; the reviewing court will not itself rewrite the rule.

4. When a court reviews a rule passed via informal rulemaking, it will determine that the agency was arbitrary and capricious if the agency: (A) relied on factors that Congress did not want considered; (B) left out a crucial issue, either one that Congress wanted addressed or that logic suggests should be considered; (C) offered an inadequate explanation, meaning that it either does not adequately treat the data on both sides, or that the explanation just doesn’t add up; or (D) made a decision that was just really stupid.

5. An agency can bolster its substantive choices by finding data to support them, undermining data that oppose them, or, in the absence of sufficient data, relying on its expertise to the extent that doing so is plausible.

6. When repealing a rule, an agency must be reasonable based not only on the original record, but also on the original rule too. That is, the record for the second rule will include the first rule and the agency’s reasons for adopting it, and the agency’s decision must be reasonable based on that record.

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Adjudication- Order: final disposition of an agency in a matter other than rule making but including licensing - Adjudication: the process for formulating an order, any agency process that results in a final

disposition, which is not rulemaking, is necessarily adjudication (minus investigation) - 554: requires formal adjudication in every case of adjudication required by statute to be

determined on the record after opportunity for an agency hearing with certain specific exceptions

- APA magic words: “on the record after the opportunity for a formal hearing” - 9th cir: Marathon Oil Co. v. EPA, 1977: Proceedings did deserve the protection afforded by 554,

556, 557 because the issues involved in the proceeding would primarily be factual and the agency decision would be subject to judicial review based on the record established in the proceeding

- 1st cir: Seacoast Anti-Pollution League v. Costle, 1978: Established a presumption that unless a statute otherwise specifies, an adjudicatory hearing subject to judicial review must be on the record and accordingly subject to section 554

- Act just said there should be a hearing (doesn’t say anything about the record) - Adjudicative facts -- wanted it to be on the record - had a formal trial type proceeding - Overruled in Dominion Energy v. Johnson, 2006 -- which applied Chevron to resolves

whether formal adjudication was required - 7th cir: City of West Chicago v. Nuclear Regulatory Commission, 1983” Presumption that formal

adjudication is not required if a statute does not use the words "hearing on the record" - Chevron 1984 If the agency looks at the statute, and the magic words aren't there, its

ambiguous on if need formal adjudication - After Chevron, agency gets to interpret if formal or not

- DC Cir: Chemical Waste Management, Inc. v. EPA, 1989 - Held that the EPA had provided a reasonable explanation for its choice of informal

procedures based on the number and nature of factual issues expected in a typical proceeding

- Rejects Seacoast - If the statute doesn’t use the magic words, the agency gets to decide

- If the agency is given a choice of using formal or informal adjudication: - Want to challenge their choice: say that their decision was A&C

- Scotus does not give chevron deference to agency interpretations of the APA - Formal v. Informal proceedings

- Little objective justification for when formal and informal adjudication is required - Anything an agency does, at the very minimum case, say it was arbitrary and capricious

Adjudicatory procedures 1. Notice: requires the proceeding start with notice including the time, place, manner of the

hearing, the legal authority for the hearing, and the matters of fact and law asserted by whoever is bringing the proceeding (the instigator of the adjudication)

2. Intervenors: an interested person may appear before an agency in a proceeding – if they have standing to appeal, they have the right to intervene. – as far as the orderly conduct of public business permits, not the same as the good cause exception – broad third-party participation happens often and easily

3. Settlement: APA always have provided there be opportunity before hearing for the parties to settle or adjust their dispute

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4. Administrative law judges - If AJL – formal - If there is a hearing, APA states that one of three entities must oversee the taking of

evidence: The agency One or more members of the body that comprises the agency One or more administrative law judges

- ALJ: Administrative law judge -- most of the procedural powers as article III judges Employees of the agency for which they act as judges Goals to make them neutral Agencies are not allowed to rate, evaluate, discipline, reward, punish, or remove

the ALJ who work for them -- adverse personnel actions can only be made by the Merits System Protection Board after a formal APA adjudication

Not under the direct control of the head of the agency - Limitation:

Not as independent as Art III judges Basically have lifetime appointments Art III judge, pay cannot be reduced, retire at full salary

Not the same for ALJ- ALJ cannot talk to anyone inside or out of the agency about the case - Separation of functions: separating the prosecution from the adjudicative functions

within the agency Three exceptions:

Initial licensing ?? Agency or a member or members of the body comprising the agency

At the ALJ level, there is a separation of functions, but at the top level a combination of functions is acceptable

5. Split enforcement arrangement - APA permits the "head" of an agency to engage in both prosecutorial and adjudicative

functions but that is sometimes separated - Rationale of split enforcement arrangements is to protect employees from any possible

bias - Agency's construction of its own regulations is normally entitled to defer4ence when

that construction is subject to review 6. Burden of proof

- APA specified the proponent has the burden of proof Burden of persuasion (not burden of production) Burden of proof

Burden of production Based on what we have in the case at this point, if you don’t

come forward with some evidence, you lose Burden of persuasion

Who needs to get to 51% Need the scales to tip in your favor

- APA requires an agency decision be support by and in accordance with reliable, probative, and substantial evidence

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Substantial evidence 556(d): in trial type procedures, decision has to rest on substantial evidence

Evidence of sufficient quality Cannot rest a case on crappy evidence Quality

Substantial evidence 706(2)(E) -- standard of review on Agency wins on questions of fact as long as they are reasonable Only asked on review by an Art III court Quantity

- Residuum Rule: prohibited a decision being rendered based solely upon hearsay evidence

- Proponent of an action always has the burden of persuasion The person who is instigating the proceedings

- If congress through hybrid requirement says otherwise that’s fine, but the agency cannot switch the burden

7. Testimony and documents: APA entitles parties to present their case orally and through documentary evidence In adjudications involving claims for money/benefits/applications for initial licenses, agency is allowed to provide for the submission of evidence in written form

8. The record and ex parte communications: APA prohibits ex parte communications during APA adjudications. Violations of this prohibition are to be cured by placing the communications on the public record with notice to all parties, with the possibility of sanctions against the violator Communications with someone outside the agency

9. Appeals: Different types of appeals procedures (review boards). Appeals within an agency are not in the nature of appellate review, the agency has all the powers which it would in making the initial decision

10. State adjudication 11. Applying adjudicatory procedures

Main difference between ALJ and Art III Judges - ALJ can admit evidence/swear in witnesses/rule on all manner of motions, but CANNOT reject

the agencies interpretation of its own statute -- cannot overturn the agencies own statute - Have to take what the agency gives them

Intra-Agency Appeals - If the agency's own statute makes it or agency decides to go formal- can have the

- ALJ or HoA make the decision or- ALJ make an initial decision which is then reviewed by HoA that makes the actual

decision - ALJ builds the record

Essence of due process: notice and opportunity to be heard need to be able to address the proper arguments

Notice violation requires prejudice to the party

1. Adjudication is defined as a process for producing an order, and an order is defined as a final agency disposition of an issue, other than rulemaking.

2. The APA provides formal procedures for adjudication in §§ 554, 556, and 557. When APA adjudication is used, it is called “formal adjudication.” When APA procedures aren’t used we

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call it “informal adjudication,” though it would probably be better to call it “non-APA adjudication” instead, because it may still be quite formal.

3. Whether or not it follows the APA’s “formal” procedures, an agency will generally promulgate (via procedural rulemaking) its own additional specific procedures for adjudication. The APA’s requirements are specific, but they are not comprehensive.

4. Constitutional due process requirements always apply, but the formal APA requirements pretty much cover them; due-process arguments tend to arise only in the context of informal adjudication.

5. As with formal rulemaking, Congress can indicate that it wants the agency to use formal adjudication by using the so-called magic words: that adjudication should be “on the record after opportunity for an agency hearing.” If the agency neither requires nor forbids formal adjudication, the agency can choose informal or formal adjudication, and (unlike with rulemaking) many do choose to use the formal APA procedures.

6. The book lays out the APA requirements for formal adjudication pretty well. We discussed notice (time, place, and manner of the hearing, the legal authority for it, and the matters of fact and law asserted by the instigator of the proceeding), third-party participation (broad, but subject to restriction for practicality; the issue here is not just whether one can participate but the extent of that participation), and ALJs (administrative law judges have most of the procedural powers of an article III judge but cannot strike down statutes, the agency’s regulations, or the agency’s interpretations of either).

7. In formal adjudication, the APA guarantees that the burden of proof always rests on the “proponent” or instigator of the proceeding, unless the underlying statute provides otherwise--only Congress, not the agency, can move the burden of proof. This applies only to the burden of persuasion (i.e., the burden of establishing a preponderance of evidence on your side), not the burden of production (i.e., the burden of coming forward with some evidence to avoid an automatic loss); the agency can shift the latter through its construction of more detailed procedures.

8. Formal adjudication--the production of a final agency order via APA procedures--can be done either by the head(s) of an agency or by an ALJ, or some combination--the statute will choose which, or the agency will choose if the statute leaves the choice to the agency.

9. ALJs are employed by the agency but are insulated from some hierarchical control. They are also kept insulated from the part of the agency (if there is one) that advocates the agency position before them. Finally, ALJs are also kept insulated from ex parte communications in adversarial cases in ways that the heads of the agency are not. -- when head of agency = different, not as isolated

10. In formal adjudication (and formal rulemaking, for that matter), the finder of fact and courts reviewing them use the “substantial evidence” (SE) standard in APA § 556(d). (This is different from the deferential “substantial evidence” standard used by courts to review formal adjudication and formal rulemaking. There, SE referred to the quantity of evidence the deferential court must find before affirming: an amount sufficient for a reasonable decision maker to reach the result the agency did.) The § 556(d) SE standard means that the ALJ must rely on evidence of sufficient quality. Under this qualitative standard, even hearsay may qualify as substantial evidence, but only to the extent that it is otherwise reliable or the opposing party had an opportunity to cross-examine it, etc.

11. For formal adjudication, some agencies use an ALJ to compile the record and propose a disposition, which the head(s) of the agency then review de novo to produce a final order. In some agencies, displeased parties have the option of either appealing the ALJ’s decision to the head(s), or just letting the ALJ’s decision become final and proceeding directly to an Article III

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court. Still other agencies just make the ALJ’s decision final, period. Others don’t use ALJs at all. It all depends on what the agency’s statute requires and, if the statute is silent, what the agency chooses.

Ex Parte Communications - Strict limits in formal adjudication -- 556&557 because of the constitution - 2 sets of limits if ALJ presiding

- 577(d) - limits communication between the decision maker and interested persons outside the agency (could be the regulated entity/interested third party)

- 554(d)(2) - ALJ cannot work under the part of the agency involved in the case (investigators) and investigators cannot advise other than appearing at the formal trial type hearing as witnesses

- 1 set if head of agency - 577(d) - limits communication between the decision maker and interested persons

outside the agency (could be the regulated entity/interested third party)- Comes down to if new and material information was discussed for it to be a due process issue - One must demonstrate prejudice to successfully allege that one has not received the notice

required by the APA for an adjudication.- There are strict limits in the APA (5 U.S.C. § 554(d) and 5 U.S.C. § 557(d)) on ex parte

communications for formal adjudication.- In 5 U.S.C. § 557(d), it is specified that ex parte communications between interested

persons outside the agency and the agency adjudicators, relevant to the merits of the adjudication, are forbidden. The most common remedy when one occurs is to disclose the communications. Where appropriate, a more severe remedy is available: the agency may require a show cause hearing in which the improper communicator is given the burden to show cause why the tainted adjudication should not be altered to his detriment. This remedy is only available when the improper communicator is a party, though, as opposed to a mere “interested person.”

- There is a third remedy for ex parte communications in a formal adjudication, not mentioned in § 557. It is for an article III court reviewing the matter to vacate the result of the adjudication and remand for a new adjudication. For this third remedy, the question is whether the decision-making process was so irrevocably tainted that the resulting judgment was unfair. One should consider: (1) the gravity of contacts; (2) whether they influenced the decision; (3) whether the improper communicator benefited; (4) whether adverse parties knew about it; and (5) whether remand would serve a useful purpose.

- Section 554(d) limits contacts from interested parties inside the agency. An ALJ is insulated from contact with the agency’s advocates. This does not apply to the heads of the agency, however, as they have to run the place and can’t really be insulated from anyone. Remedies for violations here are disclosure or vacating the result, but not the show-cause remedy from § 557.

- There are no APA restrictions on ex parte communications for informal adjudication, though many agencies have restrictions in their statutes or procedural rules, and the Constitution applies as well. The key aspect of constitutional due process is that parties have a right to notice and an opportunity to be heard. The information communicated ex parte must be new and material to the deciding official, however. If it was merely duplicative, if the other party had a chance to respond, or if it had no effect on the decision maker, then there was no violation of due process. (Keep in mind that whether something is “new” is quite arguable, as what is “merely duplicative” to one side may be “powerful and effective reiteration” on the other.)

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- Due process rights only attach in certain contexts. First, there must be individualized decision making. For instance, your right to notice and a hearing regarding taxes varies depending on the context. One that is based on an individualized assessment of personal, adjudicative facts about you (like the assessment of your home’s value for property taxes) are sufficiently individualized. More general issues based on mass, legislative facts (like changing the millage rate) are not, and you have no due-process right to be heard. (The resolution of mass issues is achieved legislatively/politically, with participation achieved through representation and the First Amendment, not the Fifth.) Virtually any challenge to procedures in adjudication will involve individualized decision making, though, so this is generally not a problem for us here (though you should still mention the requirement).

- Professional air traffic controllers organization v. Federal labor Relations authority - APA prohibits ex parte communications to or from interested parties in formal agency

adjudications - The Act requires that FLRA unfair labor practice hearings be conducted in accordance

with the Administrative Procedure Act (APA) to the extent practicable. - Section 557(d) of the APA prohibits ex parte communications to or from interested

parties in formal agency adjudications. Decision

- Disclosure of ex parte communications is important to prevent the appearance of impropriety and to ensure fair decision making.

- There are two administrative remedies for improper ex parte communications: (1) the violating party’s disclosure of the communication and its content; and (2) the violating party’s showing of cause as to why his claim or interest in the

proceeding should not be dismissed, disregarded, or otherwise adversely affected on account of the violation.

Show cause on why "blabber mouth" should not lose the case Don’t always use this remedy - by terms of 557(d) itself, only

use in limited cases (interest of justice, make sure it’s a serious enough violation that they need to show that they should not lose)

Blabbermouth must be a party to the adjudication, not an interested third party -- can only show cause if it’s a party

(3) vacate and remand court must analyze whether, as a result of the communications,

the agency’s decision making process was irrevocably tainted so as to make the ultimate judgment of the agency unfair, either to an innocent part or to the public interest that the agency is obligated to protect.

The process was so inappropriate that the decision was torn up - Improper ex parte communications, even when undisclosed in during agency

proceedings, do not necessarily void an agency decision. To determine whether an agency decision is voidable due to such

communications, court must analyze whether, as a result of the communications, the agency’s decision making process was irrevocably tainted so as to make the ultimate judgment of the agency unfair, either to an innocent part or to the public interest that the agency is obligated to protect.

- When engaging in this analysis (vacating and remanding), courts may consider a number of relevant factors, such as:

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the gravity of the ex parte communications; whether the contacts may have influenced the agency’s ultimate decision; whether the party making the improper contacts benefited from the agency’s

ultimate decision; whether the contents of the communications were unknown to opposing

parties; and whether vacation of the agency’s decision and remand for new proceedings

would serve a useful purpose. - Stone v. Federal Deposit Insurance Corp.

- Due process of Constitution guarantees public employees the right to notice and an opportunity to respond prior to their removal from office

- For there to be a due process violation, there has to be a harm

Individualized Decision Making - Constitutional due process - Prerequisite: individualized decision making

- Inherent in the notion of the due process clause that it only applies to individualized decision making

- If taking about due process on exam, make sure to say that individualized decision making is a prerequisite, then say that adjudication covers that/satisfies it

- On exam clarify if adjudicating or rulemaking

Due process argument prerequisits - Individualized decision making - Liberty/property interest - Now what process is due?

Due process hearings - Can look to other statutes that may provide procedures for adjudication if APA does not - Due process clause (5: federal; 14: state/local) - Londoner v. Denver

- City must provide notice and opportunity for a hearing before assessing a tax on landowners for local improvements that specifically benefit their land

- Bi-metallic investment co. v. State board of Equalization - Where an agency rule applies to a large number of people, the due process clause does

not require that each person have an opportunity to be heard regarding the rule’s adoption

- Factors to consider: - Number of persons affected - Extent of the impact on each person - Factual basis for determining the impact on each person

- Property interest was there a legitimate expectation that X - Liberty interest: the right to practice your profession - Paul v. Davis: a person’s reputation, on its own, is not a liberty or property interest sufficient to

invoke the due process protections of the 14A - Stigma plus

Sometimes, liberty interest threatened by a stigma, if you are saying that you're liberty interest is being compromised because of a stigma that the

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government agency is putting on you, have to show that the stigma is enough AND (the plus) that they are not just stigmatizing you, they are doing it in the context of doing something official/taking some official action against you (i.e. expelling you from law school)

Stigma plus test is only for stigma issues, not all liberty interests Just ruining reputation is not enough, have to also have official action

- Codd v. Velger- In the context of a claim of stigmatization, the due process clause only requires that an

employee have the opportunity to refute the charge against him if there is some factual dispute between the employer and the discharged employee and that dispute bears significantly on the employee’s reputation

- Cleveland Board of Education v. Loudermill - The Due Process Clause of the Fourteenth Amendment requires a limited pre-

termination hearing before the discharge of an employee who has a constitutionally protected property interest in his employment, followed by a more elaborate post-termination hearing to challenge the discharge.

- Shands v. City of Kennett - Government employees are entitled to procedural due process in connection with being

discharged from employment only when they have been deprived of a constitutionally protected property or liberty interest.

Mathews v. EldridgeScotus, 1976

Whether an administrative procedure meets the constitutional guarantees of the Due Process Clause requires a consideration of three factors: o (1) the private interest at stake in the administrative action; o (2) the risk of an erroneous deprivation of this interest through the procedures used,

and the probable value, if any, of additional or substitute procedural safeguards; and o (3) the government’s interest, including the function involved and the fiscal and

administrative burdens that additional or substitute procedural requirements would entail.

When does the constitution require the agency to give you a certain process? o PED x PI > B o If PED times PI is greater than B, entitled to the process

PED - probability of erroneous deprivation Probability that the PI will be erroneously deprived if we don’t use the

procedure that the plaintiff is arguing he is constitutionally entitled to through due process

How much without the procedure would it get wrong? Discounting according to the probability, what are the chances it will go super bad

PI - private interest (what is at stake - liberty or property interest) Magnitude of private interest in the entire class of these cases

Not deciding whether this one person is entitled to a pre-termination hearing, but the entire class

B - burden on the government of the procedure Does it save more than it costs?

Due process is not a one-size fits all matter

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- Board of Curators of the Uni of Missouri v. Horowitz: due process of the 14A does not require a formal hearing prior to the dismissal of a student of academic reasons

- WHEN TALKING ABOWUT DUE PROCESS, DUE PROCESS RIGHTS ARE ALWAYS GOING TO BE MORE SUBSTANTIAL IN AN ADVERSARIAL CONTEXT

- If its you v. other party and adversarial, strong due process rights - If inquisitorial, weaker

- Gabrilowitz v. Newman: A student has a constitutional due process right to be represented by an attorney at a disciplinary hearing when there is a pending criminal case concerning the same allegations.

- Osteen v. Henley: To determine what process is due in a student disciplinary proceeding, courts must consider the cost of the additional procedure sought, the risk of error if it is withheld, and the consequences of error to the person seeking the procedure.

1. The second prerequisite for making a due-process argument is that there must have been a liberty or property interest at stake in the underlying case. A property interest can come from having an entitlement or a legitimate, not-unilateral expectation of a guaranteed benefit. A liberty interest can be (among other things) the interest in pursuing a particular profession.

2. In some (not all, just some) liberty-interest cases, the infringement is because of a reputational harm (a stigma) that seriously impedes that pursuit. In stigma cases, that harm must be accompanied by some other action (a “plus”) by the agency (like revoking a license or firing you from a job).

3. [More commonly and simply, it can also be harm to something you simply own (property interest) or bodily restraint (liberty interest). Most liberty-interest cases do not require use of the Stigma Plus test.]

4. To explain the Stigma Plus test in more detail, here is a set of examples that (I hope) makes this clear:

1. A government actor says that I am stupid. Now, everyone thinks I am stupid. No liberty interest is implicated here. There is stigma, but not enough, and there is no plus.

2. A government actor says that I am stupid. Now, everyone thinks I am stupid. As a result, no one in my profession will hire me. There is significant enough stigma, but no plus.

3. A government actor says that I am stupid and fires me. I easily get another job doing the same thing I had been doing for the government. There is a plus here, but not sufficient stigma.

4. A government actor says that I am stupid and fires me. Now, everyone thinks I am stupid. As a result, no one in my profession will hire me. There is stigma plus here.

5. Once you determine that due process rights apply, you must determine what process is due. For this, we turn to Mathews v. Eldridge, 424 U.S. 319 (1976). Under Mathews, we look at the general type of procedure (e.g., witnesses at an academic disciplinary hearing, social security disability benefit pre-deprivation hearing, etc.) that the plaintiff is claiming should have been used. We balance on one side the burden to the government that this additional procedure would represent. On the other side we look at the interest that is at stake for people in plaintiff’s position, discounted according to the probability that adding the procedure in question will prevent the erroneous deprivation of that interest. In other words, the value of the procedure is based on the number of cases in which it can fix a bad result. When performing this analysis, the variables should be assessed for the entire class of cases, not just plaintiff’s individual case.

1. Cost-benefit analysis approach to the constitution Neutral Decisionmaker

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- Withrow v. Larkin: one of the requirements of due process is a neutral decisionmaker - Not worried about the investigators being biased in an unconstitutional way because

they are not prosecutors here -- inquisitorial system - not prosecution - If neutral decision maker question, look for

When the decision maker has some stake in the outcome (pecuniary interest - financial interest in the outcome of the case)

When the judge has personal conflict/connection with enmity involved

Judicial Review706 - specifies the grounds for judicial review of any agency action, and a litigant might be able to challenge the agency's adjudicatory decision on any of the grounds listed in the APA

1. Substantial evidence standard - 706(2)(E) provides that agency action is to be held unlawful if it is "unsupported by substantial

evidence in a case subject to 556 and 557or otherwise reviewed on the record of an agency hearing provided by statute o Only applies to formal agency action

- Substantial evidence - evidence supporting agency decision- When reviewing questions of fact that the agency ruled in formal adjudication

o Otherwise Arbitrary and capricious o Both really just looking for reasonableness

2. Substantial evidence and the ALJ's credibility finding - Judicial review under the substantial evidence test, an ALJ has first reached a decision, making

findings of fact and conclusions of law, and the agency on appeal then also made a decision that includes findings of fact and conclusions of law

- 557 - agency in making its decision on review has all the powers which it would have in making the initial decision o Has been interpreted to mean that the agency makes its decision de novo and that the

agency is not required to defer to the ALJ's finding and conclusion - Two types of evidence

o Derivative evidence -- what you can assess without hearing live testimony -- from the cold record Be careful with this

o Demeaner evidence: Testimonial inferences - Torres v. Mukasey: courts are highly deferential to an IJ’s credibility determination that is based

on specific, cogent reasons that bear a legitimate nexus to the finding. - Jackson v. Veterans Admin: when an agency’s reviewing board reverses the findings of a

presiding official, federal courts may only sustain the board decision if the board has articulated a sound reason, based on the record, for its contrary evaluation of the evidence

- Even if reviewing de novo, want a different result than ALJ - with demeanor evidence have to either

o Come to a different result based on derivative evidence; oro Disagree with the ALJ on demeanor points (if, this is typically a long shot) if you have a

reason to say that’s not an appropriate assessment of demeanor - Cant just second guess the person who heard the live testimony decision on the live testimony

Question of law Looking at statute/rule - ask what the legal standard are here.

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De novo review but maybe with deference (such as Chevron)Question of fact

What happened Defer from the beginning, accept as long as reasonable basis in record

Mixed question of law and fact Combines the two What most of the questions are Reviewing court: determines if the agency got the legal standard right and then review the facts

National Labor Relations Board v. Hearst Hearst Deference - When reviewing an agency decision involving a mixed question of law and fact, courts review

o (1) the facts found by the agency to determine whether the agency’s conclusion has “warrant in the record” and

o (2) the agency’s explanation of its decision to determine whether the decision has a reasonable basis in law.

- Chevron but for formal adjudication (Hurst deference) o Is it theres to interpret o Is there ambiguity

If not, de novo o Deference as long as reasonable

If not, de novo

- Evening Star Newspaper co. v. Kemp: when an ALJ’s decision is supported by the evidence and is not inconsistent with the law, a court should uphold it

o Note: torts – frolics and detours just because you are on the job, doesn’t mean you are necessarily working at that moment

- Durrah v. Washington Metropolitan Area Transit Authority: An employee is entitled to benefits under the Act for injuries sustained within the period of his employment, at a place where the employee reasonably may be, and while he was engaged in doing something incidental to his employment.

1. Another due process right is the right to a neutral decision maker. A neutral decision maker is one who has no personal or financial interest in the case that would sway his or her consideration of the facts. We also look out for prejudgment of facts. Prejudging matters of law does not present a due-process problem, though. Combining an investigatory and decision-making role does not necessarily present a problem either, at least if it is in an inquisitorial rather than adversarial setting.

2. When performing judicial review of a formal agency adjudication, using the 706(2)(E) “substantial evidence” standard means that the court looks to see that a reasonable person could have found enough evidence in the record that they could have reached the same conclusions as the agency did. However, it may be that considering other evidence necessarily leads a reasonable person to discount some of the evidence favoring the agency’s result. In other words, the reviewing body must consider the evidence in light of the record as a whole. While the record may be viewed in the light most favorable to the agency or ALJ result, that light shines on all of the evidence in the record.

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3. When an agency has an adjudication procedure involving both an ALJ and the head(s) of the agency, the ALJ’s findings derived from the demeanor of witnesses (“testimonial inferences”) receives “weight” from the agency head. Inferences that can just as well be derived from the cold record (“derivative inferences”), however, do not receive any such weight, though like all of the ALJ’s conclusions they become part of the record. When an Article III court reviews such a case, it will review the head’s decision under the appropriate deferential standard for reviewing facts, though it too will give weight to the ALJ’s first-hand testimonial inferences. This means that the head should, if it wishes to differ from the ALJ yet survive Article III review, either rely on sufficient derivative inferences to constitute § 706 substantial evidence, or have a very good reason for rejecting the ALJ’s testimonial inferences beyond just second-guessing the ALJ’s first-hand assessment of demeanor.

4. With formal adjudication, fact questions (“was Lund on patrol that night?”) are reviewed under the substantial evidence standard and questions of law (“what constitutes being ‘in the course of employment’?”) are reviewed de novo--but perhaps with deference added on.

5. The Hearst line of cases suggests that deference may be appropriate on questions of law when an Article III court reviews an agency’s formal adjudication. As in Chevron, deference is obtained only when (1) the statute is one that the agency is in charge of applying; and (2) the statute is ambiguous and leaves it to the agency to resolve the ambiguity. At that point, the court should accept any agency interpretation that is reasonable. If Hearst deference does not apply, then review of questions of law remains de novo (though we will talk about other forms of deference later on).

6. A complicated issue arises over mixed questions of fact and law (“was Lund acting in the course of his employment that night?”), which are questions that require of the agency both a factual assessment of what happened, and a legal assessment of the standard to be applied. This issue is less complicated when Hearst deference applies, because then both fact and law review is essentially deferential to the same degree (reasonableness). If Hearst does not apply, however, these mixed questions may not be reviewed with as much deference. The underlying factual findings will be, but not the application of the law to those facts. A helpful way to approach these issues is to ask first whether the agency used an acceptable legal standard (a question that may or may not be answered deferentially), and second, if so, whether there is substantial evidence to support the factual findings plugged into it.

Arbitrary and Capricious Review - Informal adjudication: §706(2)(F) provides for the courts to determine the facts independently

by authorizing a court to overturn an agency decision if it is "unwarranted by the facts to the extent that the facts are subject to trial de novo by the reviewing court"

- Was the agency reasonable and did they provide an adequate explanation o Varies by context

- Citizens to Preserve Overton Park v. Volpeo When reviewing an agency decision, the Administrative Procedure Act (APA) requires

courts to consider: (1) whether the agency acted within the scope of its authority; (2) whether the agency’s actions were arbitrary, capricious, an abuse of

discretion, or otherwise not in accordance with the law; and (3) whether the agency’s action met the necessary procedural requirements.

o De novo review of whether the secretary's decision was unwarranted by the facts is authorized under 706(2)(F) in only two circumstances (306)

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Such de novo review is authorized when the action is adjudicatory in nature and the agency fact finding procedures are inadequate

If an agency has authority to pursue violators in art III court There may be independent judicial fact finding when issues that were not

before the agency are raised in a proceeding to enforce non-adjudicatory agency action

When the agency has inadequate fact-finding ability -- not that they didn’t do it, but that they couldn’t (not equipped to or the statute doesn't allow it)

o Court wants as few trials as possible o Remedy: send it back

Agency will review if your decision was reasonable based on the record, there was no record, make them make a record

Adequate explanation requirement "because I said so" is not an adequate explanation

o Need to support decision with adequate facts in the record - therefore, need a record Is the decision reasonable based on the record?

- How to avoid Arbitrary and capricious o Have to be inside the circle o Adequate explanation backed up by record – why it’s reasonable in the record and why

its reasonably from departing from the previous interpretation

Major Themes Formal adjudication are generally governed by the Administrative Procedure Act, and typically

provide/require that an individual be given a full evidentiary hearing Informal adjudication can be governed by statutory or regulatory requirements, but frequently are

governed by the due process clause of the constitution Executive summary

o Orders and adjudications Under the APA, an order is a final disposition of an agency in a matter other than rule

making but including licensing Except for rulemaking, an agency's final disposition is necessary an order Investigations and info gathering are not adjudication

o Scope of the term adjudication o Formal v. informal adjudication

Informal adjudication can be very formal APA adjudication and non-APA adjudication, meaning that the former is governed by

the procedures specified in APA and the latter is not APA procedures for formal adjudication are at 554, 556, 557 and generally reproduce

the procedures applicable to a trial without a jury but with an ALJ presiding APA specifically imposes no requirements on informal adjudication

Requirements for formal adjudication o When formal adjudications are involved, section 554 imposes various requirements

Proceeding begins with notice Includes the

time, place, manner of the hearing The legal authority for the hearing

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The matters of fact and law asserted by whoever is bringing the proceeding

rules regulating intervention by interested persons An opportunity to settle or adjust the dispute The hearing must be overseen by the agency, one or more members of the body that

comprises the agency or one or more administrative law judges (with variances for agencies with split enforcement models)

requirement that the proponent of the order must bear the burden of proof A requirement that the agency's decision be supported by and in accordance with

reliable, probative, and substantial evidence that the parties be allowed to present their case by oral or documentary evidence, to submit rebuttal evidence and to cross examination

Due process hearing Application of the due process clause

o Does the clause apply at all? o Is the procedures required?

o Due process requires the government to hold some type of hearing before it deprives an individual life, liberty, or property based on the resolution of disputed factual issues pertaining to that person

o Individualized decision-making Definition of property for due process purposes

o The court held that a recipient was entitled to a per termination hearing before welfare benefits could be terminated

o Welfare benefits laws an entitlement Definition of liberty for due process

o Protections if there is a denial of an individual license to engage in a profession The requirements of due process

o Mathews v. Eldridge Flexible due process would be applied in informal adjudications, and the process

would be determined by considering 3 distinct factors The private interest that will be affected by the official action The risk of erroneous deprivation of such interest through procedures used and

the probable value, if any, of additional or substitute procedural safeguards, Governments interest, including the function involved and the fiscal and

administrative burdens that the additional or substitute procedural requirement would entail

Neutral decisionmaker requirement Judicial review

o 706(2)(E) provides an agency action be held unlawful if it is unsupported by substantial evidence in a case subject to section 556 and 557 of this title or otherwise required on the record of an agency hearing provided by statute

1. The de novo standard of review for questions of fact expressed in 5 U.S.C. § 706(2)(F) is used in the review of adjudications only when the agency’s fact-finding ability is inherently inadequate. If, as to fact-finding, the agency simply failed to execute, the court will usually just remand the case back to the agency to do it right. A more common way for de novo treatment of questions of fact in court to be appropriate is for the agency’s specific statute to direct that actions begin in article III court in the first place.

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2. The “arbitrary and capricious” standard, which applies to questions of fact in an informal adjudication being reviewed in court, requires reasonableness, just as it does in the other places it is used.

3. One way for an agency to be arbitrary and capricious in an adjudication is to give an inadequate explanation of the basis of the decision. While courts are deferentially wary of second-guessing the thought processes of the agency, they do not hesitate to remand a case when insufficient information has been conveyed to give an adequate inkling as to what the agency was even thinking.

4. By way of review, arbitrary and capricious review pervades administrative law, and wherever we find it, it includes an adequate explanation requirement. How much is “adequate” varies by context, though, and in some places very little is required.

5. Another version of arbitrary and capricious agency adjudication is inconsistency. Deferential review allows for a range of outcomes at the agency level, but at some point the agency is supposed to speak with one voice. The agency cannot be unreasonably inconsistent from one case to the next; other than in cases of first impression, the agency must justify an adjudicatory decision in terms of established agency precedent. This leaves room for the same sort of evolution that occurs in the common law (indeed, maybe even a bit more), but not for unreasonable or unexplained shifts of policy. In other words, the agency can have a major shift, but at the very least such shifts require confronting and satisfactorily explaining the departure.

6. You should apply the adequate-explanation requirement to substantial-evidence review as well as arbitrary and capricious review.

- Choice of Procedures and Non-Legislative Rules- Non-legislative rule: agency pronouncement that advises the public of the agency’s view on an

issue o by itself does not have binding legal effect on 3rd parties

- 553 identifies 2 types of non-legislative rules that are not subject to notice and comment o Interpretive ruleso General statements of policy

Rulemaking v. adjudication- Rulemaking more likely to engage national interests while adjudication attracts less attention

o Might make it take more time o Rulemaking requires notice and comment

- Proceeding against one individual/firm is likely to be a significantly less expensive and time consuming than rulemaking which is applicable to the entire nature

- Adjudication can pick its defendant (can pick a weaker one) o Weak D to get the standard the way you want

- Substantial and increasing procedural requirements for rulemaking can create burdens not applicable to adjudication

Legal constraints - If filing in blanks in statute - rulemaking - Adjudication - flexibility - Chenery - if the agency is allowed to choose which one to use, as long as reasonable, court

needs to leave that decision alone o Needs adequate explanation on why choosing adjudication or rulemaking

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- Retroactivity

Adjudication - National labor relations board v. Bell Aerospace: an administrative agency is not precluded from

announcing new principles in an adjudicative hearing - Retain, wholesale, and department store union v. National labor relations board:

o When deciding whether to grant or deny retroactive force to newly adopted administrative rules, reviewing courts balance the value of retroactivity against the consequences of producing a result that is contrary to a statutory design or to legal and equitable principles.

o When deciding whether to grant or deny retroactive force to newly adopted administrative rules, reviewing courts balance the value of retroactivity against the consequences of producing a result that is contrary to a statutory design or to legal and equitable principles.

o This balancing entails the consideration of a range of factors, including: (1) whether the particular case is one of first impression;

If first impression, less appropriate to apply retrospectively (2) whether the new rule represents an abrupt departure from well

established practice or merely attempts to fill a void in an unsettled area of law;

Big departure, less appropriate to apply retroactively (3) the extent to which the party against whom the new rule is applied relied

on the former rule; More reliance, less appropriate to apply retroactively

(4) the degree of the burden that a retroactive order imposes on a party; and Is there some reason why you shouldn’t apply retroactively

(5) the statutory interest in applying a new rule despite the reliance of a party on the old standard.

Was there a big injustice? o If applied retroactively - de novo, if not, probably AC o Potentially both a question of law (what are they allowed to do) and fact (the reasoning

on the decision - reviewed more detrimental) Rulemaking

o Does the agency have the authority to promulgate substantive rules o Can an agency restrict the scope of adjudicatory hearing rights by promulgating a rule

that eliminates the materiality of facts that otherwise would be subject to resolution by hearing?

o Can an agency give retroactive effect to a rule o To what extent does due process limit an agency's authority to use adjudication to

clarify an ambiguity in a rule?- Rulemaking authority

o Agency has authority to promulgate legislative rules if congress has given it this power - Impact on adjudication rights

o Some agencies protect against adjudication right by having a waiver process - make whatever rule you want, but allow people to apply for waivers (either from the statute or the rule)

- Retroactive rulemaking

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o Can say the legal standard of what previous rules are o To the benefit of regulating o Do they have language in the statute that says they can do this? o Agency can make retroactive rules IF their statute allows it

- Due process limitations o Ambiguous Rules

- General Electric Co. v. US environmental protection agency o The constitutional guaranty of due process requires that an agency provide a regulated

party with fair notice of its regulatory interpretations before depriving such a party of its property.

o Does the agency's interpretation of their own ambiguous rule prevail Chevron deference to agency interpretation of own ambiguous rule

o Separately, can this interpretation be imposed? As long as their interpretation is reasonable GE deference/Seminole Rock deference/Auer deference --- when the agency is

interpreting its own rule - deference as long as reasonable ??? o Fairly obvious standard

1. Sometimes, an agency’s statute may leave room for it to choose to develop standards either through rulemaking or adjudication.

a. The advantages of rulemaking are that: i. (1) it provides clear, broad notice;

ii. (2) in the enforcement context, it can tell everyone what to do, both negatively and positively, instead of creating standards gradually, around individual violations; and

iii. (3) the comment process provides helpful input. b. The advantages of adjudication are that:

i. (1) it is faster and cheaper;ii. (2) it allows standards to develop case by case with hindsight, and in a more flexible,

nuanced, and contextualized manner; and iii. (3) it allows handpicking the adverse party/case.

2. Adjudication is faster and cheaper both because no comment period is required and because adjudicatory notice is, as a practical matter, less effective. But don’t overdo this distinction—sometimes adjudication results in clear, adequately noticed standards. (As we saw before, while there may be participation in a formal adjudication that is just as wide as in rulemaking, 5 U.S.C. § 555 allows the agency to limit participation based on the need for the “orderly conduct” of business.)

3. The choice of procedures that an agency makes (to the extent that it has a choice) is reviewable, but only for arbitrariness and caprice.

4. Adjudication may present a problem regarding retroactivity, if it imposes a standard on a party that was too difficult for the party to anticipate.

a. The party in the original adjudication must be subjected to some consequence under the new rule; otherwise, the adjudication would be non-adversarial, purely prospective, and amount to rulemaking without all of rulemaking’s constraints. If a rule is good enough to apply prospectively, it must be good enough to apply to the party in the adjudication.

b. But third parties whose conduct occurred before the new rule was announced are more likely to be exempted from a retroactive effect when their cases come up before the agency in subsequent adjudications.

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5. The standard for determining whether a standard announced in an adjudication should apply retroactively are:

a. (1) the extent to which the standard is new/different and thus unexpected and upsetting to substantial reliance interests; and

b.(2) the countervailing interest that the agency has in imposing the standard retroactively.

a. This applies both to applying a particular sanction in the first case in which the new standard appears, and to applying that sanction or any sanction at all in subsequent cases.

b. RWDSU factors i. How big a change

ii. How much of a shift in the law iii. How much were they relying on the old one

c. Was the interpretation reasonable d. Interpretation - to what extend can you impose some sanction on the regulated entity when

they might not have known coming into the case what standard was going to be applied to them

e. Cease and desist order can count as the consequence 6. Before an agency can choose to use rulemaking, it must be authorized by statute to do so.7. A definitive rule can moot a statutory right to receive a formal adjudication.

a. The rule may be so clear that there are no material facts left to adjudicate, in which case the regulated entity no longer has a right to formal adjudication.

b. Some agencies have waiver provisions by which entities can argue that they should be exempt from a rule, but agencies generally are not required to do so, and they tend to be sparing in the use of such procedures when they do have them.

8. Agencies can make rules apply retroactively, but only if explicitly authorized by Congress in the agency’s statute.

9. A court will defer to an agency’s interpretation of its own vague rule, so long as that interpretation is reasonable. We will call this GE (or Seminole Rock or Auer) deference.

10. An entity may claim that even if the court accepts the agency’s interpretation, it should not be applied to the entity’s particular case because it had no notice of the agency’s interpretation, but such a claim will only succeed if several factors are in place.

a. First, there must have really not been any notice, and there are a few ways to give notice: agencies can provide direct pre-enforcement notice to the entity, or they can publish their interpretation as a nonlegislative rule, or a case might not be one of first impression.

b. Second, it must be reasonable for the entity not to have anticipated that the agency might choose the interpretation that it did (under the “fairly obvious” standard). i. If the agency’s position is one of a number of apparent possible interpretations, that is

good enough for the agency to win under this standard. c. Third, the entity will have a hard time prevailing unless the penalty leveled against it is both

substantial and retrospective (e.g., a big fine, as opposed to a cease-and-desist order). Non-legislative rules:

- Interpret the statute using non-legislative rules - Don’t need notice and comment - Two types:

o Interpretive rules: Statement issued by an agency to advise the public of the agency's construction of the statutes and rules which it administers

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o Statements of policy (policy statement): Statement issued by an agency to advise the public prospectively of the manner in which the agency proposes to exercise a discretionary power

- These rules warn the public of an agency interpretation or policy - APA does impose some requirements concerning the publication of such rules - Party can challenge a non-legislative rule on the ground that the pronouncement is really

legislative rule - When an agency issues a non-legislative rule, it is likely that members of the public will rely on

the rule Advantages and disadvantages of non-legislative rules

Non-legislative rules to be an efficient and beneficial way to implement regulatory policy o A lot faster o No notice and comment

Can also be a disadvantage - lose the value of the comments and public impute and legitimacy that comes from the process value

o Probably don’t have to go through hybrid requirements as well (sometimes they might, generally they wont)

Creates uniformity within the agency, can issue management guidance to their employees quickly

Not binding on regulated entities, but might be on the agency o Agency telling you that is how they are interpreting it o Can bind in a de facto sense

Non-legislative rule is a means of informing the public as to the agency's views and intention o Most members of regulated community will change their behavior in accordance with the

non-legislative rule o If the agency wants to take action against them, the regulated community will not be able

to claim surprise o Violation of the interpretation cannot subject you to consequence

If you violated the statute though you fucked Non-legislative rule can be used as a management tool to issue guidance to agency employees -

thereby ensuring centralized policy control and administrative uniformity Non-legislative rules have become the bread and butter of the administrative process Problematic because

o Rules adopted without public input o Agency may treat a non-legislative rule as binding on members of the public o Because members of the public rely on non-legislative rules as authoritative guidance of

an agency's intentions, these persons may be adversely affected by their reliance o Interpretation of the statute made by non-legislative rule, might not get chevron

deference Fast, cheap way to tell the public what to do, not binding, but if the public is smart, they will

follow Non-legislative rule in place provides notice

APA Notice Procedures

- APA does mandate procedures for non-legislative rules concerning their publication

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- Section 552 - Freedom of Information Act (FOIA) requires each agency to publish in the Federal Register "statements of general policy or interpretations of general applicability formulated and adopted by the agency o A person may not in any manner be required to resort to, or be adversely affected by, a

matter required to be published in the Federal Register and not so published except is the person has actual and timely notice of the terms of the matter

o When a person proves that an agency failed in this legal duty to make information public, a court can provide adequate relief

o FOIA requires that non-legislative rules be put in the federal registry o If you don’t, nothing really happens, but you cannot use it against people (in its unbinding

way….) - Publication procedure -- 553(d)

Policy statement Interpretive rule Legislative rule

Advise the public of prospective matters on what the agency wants to do

"how they would like to" exercise their power (not how they will)

"regulated entities should do this" (not must do this)

Should/may (not must or will)

Conditional language

Binding in a de facto sense Can charge with violating the statute

or the rule -- binding the agency on how its enforcing the statute, but violating the interpretive rule itself isn't binding?

Is it the source of a duty to the regulated entity?

Refining and clarifying

If they say legislative rule, take it at their word

Test: o What are they saying it is?

If legislative rule, stop there and take it at their word o Is it the source of a duty of the regulated entity?

Source of duty: - Creates a new duty? - Is the statute or the interpretative rule instructing the regulated entity on how to do something?

o Interpretative rule - what the statute meant (x=10) Reduces the universe of duties But if it says x=y not really interpreting the statute

Agencies do not have the inherent authority to make legislative rules, the statute has to give them rulemaking authority

- American mining congress v. Mine Safety and Health Admin: agency rule is subject to APA notice and comment requirements if it has the full force of the law

To determine whether a rule is legislative or interpretative, courts consider:

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- (1) whether in the absence of the rule there would not be an adequate legislative basis for enforcement action or other agency action to confer benefits or ensure the performance of duties; - is it creating a duty, is there a basis for action without the interpretative rule

- (2) whether the agency has published the rule in the Code of Federal Regulations;

o Only binding stuff goes here - (3) whether the agency has explicitly invoked its general legislative

authority; or o Same as 2 - are they saying it’s a legislative rule

- (4) whether the rule effectively amends a prior legislative rule. If the answer to any of these questions is affirmative, the rule is legislative.

o Does it conflict with or amend the law of the legislative rule - Substantive rules

o Rules, other than organizational or procedural under section 3(a)(1) and (2), issued by an agency pursuant to statutory authority and which implement the statute, as, for example, the proxy rules issued by the Securities and Exchange commission pursuant to section 14 of the Securities Exchange Act of 1934.

o Such rules have the force and effect of law - Interpretive rules

o Rules or statements issued by an agency to advise the public of the agency's construction of the statutes and rules which it administers

- General statement of policy o Statements issued by an agency to advise the public prospectively in the manner in

which the agency proposes to exercise a discretionary power - Metropolitan school district v. Davila: interpretative rules are exempt from the APA’s notice and

comment requirements o To determine whether an agency rule is interpretative, courts first look at the agency’s

characterization of the rule. o Courts then consider whether the rule

(1) simply states what the administrative agency thinks the underlying statute means and reminds affected parties of existing duties, or

(2) creates a new law, rights, or duties. If the rule falls within the first category it is an interpretive rule; if it falls within the second category it is a legislative rule.

o Test: Look at the agency’s characterization Does the rule in question create a new duty?

1. A third choice that an agency can use to implement standards from a statute (if the statute gives it a choice) is to use nonlegislative rulemaking to interpret the statute. The principal advantage is that nonlegislative rules do not require notice and comment or any of the other complications of legislative rulemaking, so they can provide structure and relative certainty quickly and cheaply. The principal disadvantage is that they do not get the deference or have the binding force of law that regular rules or formal adjudications do. Also, notice and comment are not all bad.

2. FOIA (5 U.S.C. § 552) requires that nonlegislative rules be published in the Federal Register. This requirement is weak, though, because the consequence upon a violation is that the agency cannot

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use an unpublished nonlegislative rule to someone’s detriment. Since nonlegislative rules are not formally binding, that rarely happens anyway.

3. One category of nonlegislative rules--policy statements--are distinguished by their failure to bind the agency (let alone the regulated entity). Policy statement set forth the agency’s desires using hedged terms like the “regulated entities should” or “the agency may,” as opposed to setting forth requirements and using mandatory terms like “must” or “will.”

4. Interpretive rules are binding in one, informal sense--once an agency promulgates one, it is bound to follow it unless and until it comes out with a new interpretation. As a result, regulated entities are informally bound by it too, in the sense that they must follow the agency’s interpretation or suffer the likely (if not quite official) consequences. In another sense, though, interpretive rules are not binding, because they do not create a new duty. In fact, because they focus and clarify the duty imposed by a vague statute or legislative rule, it can be said in the abstract that they actually reduce the potential duties of regulated entities.

5. An interpretive rule is determined to be such by looking at two factors. First, does the agency characterize it as one? (This obviously cannot be dispositive.) Second, what is the source of the duty placed on the regulated entity? If the rule really is an interpretive rule, the actual duty at issue will come from the statute or legislative rule that the IR interprets. If it creates a new duty, it cannot be an interpretive rule and it must go through notice and comment. But creating a duty is different from adding detail or focus where there was none before.

Estoppel: - Need to show detrimental reliance and that you were harmed because of the reliance and the

reliance was reasonable - Not always reasonable to rely on the government

o Almost never can you win estoppel against the government

Legal protection of reliance on non-legislative rules - Heckler: A party claiming estoppel must have relied on its adversary’s conduct in such a manner

as to change his position for the worse, and that reliance must have been reasonable in that the party claiming the estoppel did not know nor should it have known that its adversary’s conduct was misleading.

- Office of personnel management v. Richmond: Ordinarily, the US government may not be estopped because of erroneous or unauthorized statements of its employees when the asserted estoppel would nullify a requirement prescribed by congress

o Appropriations clause - no money cannot be taken from the treasury but in consequence of appropriations made by law -- there must be statutory authorization

o Hard to get $ in cases of estoppel against the government because you have to be consistent with the statute

- Appeal of ENO: The constitutional guaranty of due process forbids an agency from denying or thwarting claims of statutory entitlement through a procedure that is fundamentally unfair.

o The constitutional guaranty of due process forbids an agency from denying or thwarting claims of statutory entitlement through a procedure that is fundamentally unfair.

o Was only granted because was in state court Some states are more favorably disposed to finding estoppel applies and are not

bound by appropriations clauses

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JUDICIAL DEFERENCE: STATUTORY INTERPRETATION

What is being interpreted

STATUTE LEGISLATIVE RULE

With what is it being interpreted?

Legislative rule Chevron X

Formal adjudication

Hearst (basically Chevron) Is there a statute to

interpret Is it ambiguous Is the interpretation

reasonable

GE Auer/ Seminole Rock

Informal adjudication

Force of law? Yes: Chevron No: Skidmore

GE

Non-legislative rule

Skidmore WALTON ANALYSIS

GE *

If you have a vague legislative rule parroting a vague statute then the non-legislative rule is treated as through its interpreting the statute (Gonzales v. Oregon)

Policy statement

No Chevron No force of law Skidmore

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Even less than non-legislative rules

Analysis: GE = Auer = Seminole Rock Chevron Hearst

- Christensen v. Harris County: When contained in an opinion letter, an agency interpretation of its own statute is not entitled to Chevron deference, but it is entitled to respect if it has the power to persuade.

- US v. Mead: Even if an agency's interpretation of a statute is not entitled to deference under Chevron, it may still be entitled to deference under Skidmore according to the persuasiveness of the interpretation.

1. It is exceedingly rare for a federal court (less rare for a state court) to find that the government is estopped from using an interpretation against a regulated entity on grounds that the entity had been told something different, unofficially, by an agency employee. In private law, such estoppel requires reasonable, detrimental reliance. When government action is at issue, courts find it difficult to conclude that relying on agency communications is reasonable. This is especially true if the communication was informal, oral, etc. Among other reasons for the government to be treated differently here are that the government acts pursuant to law, which anyone can find for themselves (or with a lawyer’s help); and that estoppel amounts to a rogue employee and a court applying different law to the regulated entity than that which Congress passed. Estoppel would be especially problematic--and unconstitutional--when the estoppel decision would require expenditure of federal funds.

2. Estoppel might succeed, though, if criminal sanctions are at stake. It is also used in some state courts. And even if estoppel doesn’t work, the regulated entity might try to make a due-process, consistency, or notice argument.

3. The pre-APA case of Skidmore v. Swift provides for a form of weak deference that applies in cases where Chevron deference does not (such as when the agency’s interpretation is in a context that lacks the force of law). Skidmore looks at factors such as the expertise of the agency, the care with which the issue was considered, etc. Skidmore deference is quite indeterminate, and its effect can range from no real deference at all to essentially giving the agency the full benefit of the doubt.

4. The agency’s interpretation of vague rules (as opposed to vague statutes) is still accorded something much like Chevron deference under GE/Auer. Under Gonzales v. Oregon, though, the Court apparently will not apply GE/Auer deference in situations where the legislative rule just parrots the vague statute, and will instead treat this as though the interpretative rule is interpreting the statute rather than the rule (though as we will see next time, with Walton this might mean that the agency still ends up with Chevron-like deference).

5. The Chevron analysis is not applied to every agency interpretation of a statute, though just when it does apply will need to wait until the next class to settle. Interpretations of statutes emerging from rulemaking, formal adjudication, or other things that have the force of law are not problematic—they get Chevron. But others, like interpretations of statutes that do not have the force of law (such as some of those emerging from informal adjudication, and nonlegislative rules), fall into a grayer area.

Barnhart v. Walton

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- Pursuant to Chevron (1984), when a statute is silent or ambiguous as to a specific issue, a reviewing court must sustain an agency’s interpretation of the statute as long as the interpretation is based on a permissible construction of the law.

- Chevron deference applies due to the interstitial nature of the legal question, the related expertise of the agency, the importance of the question to the administration of the statute, the complexity of that administration, and the careful consideration that the agency has given the issue over a long period of time.

- Walton is a test for choosing between chevron analysis and Skidmore - Things to consider: interstitial nature of the legal question, the related expertise of the agency,

the importance of the question to administration of the statute, the complexity of that administration, and the careful consideration the agency has given the question over a long period of time

o Related expertise: similar to Skidmoreo The importance of the question to the administration of the statute

Assume that Mead is still there and relevant If it doesn’t have the force of law, Walton

If this is so central to the administration of the statute, if interpreting this phrase is going to come up in every case, then however the agency answers this, then they should get Chevron

- Even though is a non-legislative rule, its soooooo central, therefore they are comfortable with deference

Congressional intent and deference When unclear when a court will use Chevron deference

o Court is seeking to resolve the issue of the level of deference for various types of agency actions based on congress intent

If congress intended that a particular type of interpretation or decision should receive deference, then the courts apply Chevron

Courts apply Chevron because congress intended that the agency, not the courts, should have primary responsibility to resolve the type of legal issue that has arisen

o While the court is focusing on legislative intent, it is usually not seeking congress's "actual" intent - using hypothetical intent, focusing on whether it si reasonable to assume that congress meant for the courts to defer to the agency's interpretation or application of a statutory provision.

Court focuses on certain aspects or attributes of the administrative process used by the agency in interpreting the statute as an indication of likely legislative intent concerning whether Chevron deference is appropriate

Interpretations of agency regulations Bowels v. Seminole Rock: courts should defer to an agency's interpretation of its own regulations Gonzales v. Oregon, 2006: court said an agency does not acquire special authority to interpret its

own words when instead of using its expertise and experience to formulate a regulation, it has elected to merely paraphrase the statutory language o When an agency merely parrots the words in the statute in the agency's regulation, the

subsequent informal interpretation of the regulation giving real meaning to the regulation/statute does not qualify for Seminole Rock/Auer deference

Coeur v. Southeast Alaska Conservation Council o Indicated interplay between Chevron and Seminole Rock/Auer deference

MAJOR THEMES

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Agencies can announce policies using adjudication, rulemaking, or non-legislative rules Executive summary:

Restrictions on the use of adjudication: o NLRB v. Bell Aerospace holds that an agency can announce a new policy in adjudication

unless doing so would amount to an abuse of discretion or violate the agency's statutory mandate

o RWDSU v. NLRB: court determined whether an abuse of discretion had occurred by comparing statutory interests advanced by using adjudication and the inequity of doing so in terms of the impact of the adjudication on the regulated entity

5 factors considered in making this judgment 1 2 3 4 5

Restrictions on the use of rulemaking o Bowen v. George University Hospital: agencies do not have the power to give rules

retroactive effect without express grant of such authority by congress o General Electric Company v. EPA: due process clause may limit an agency's enforcement of a

policy adopted in rulemaking Non-legislative rules are "rules"

o Agency's choice of a non-legislative rule to adopt a new policy is different than if it uses adjudication or rulemaking because, by itself, a non-legislative rule does not have binding legal effect on third parties

o Such statements are rules because they fit the APA definition of rule (the whole or part of an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy)

Litigation against non-legislative rules o Parties who oppose a non-legislative rule may attack it as not really being a non-legislative

rule but rather a legislative rule o If successful, court will hold the rule is invalid

Policy statements o Policy statements are issued by an agency to advise the public prospectively of the manner

in which the agency proposes to exercise a discretionary power in subsequent adjudication or a rulemaking

o Courts will use a "binding effect" test to distinguish policy statements from legislative rules o Court will ask whether the statement of the agency imposes a new duty or merely

announces the intention to impose a new duty at some future time Interpretive rules

o Interpretive rule interprets or clarifies the nature of the duties previously established by an agency's statutory mandate or by a regulation promulgated by the agency

o In an interpretive rule, an agency announces how it believes an existing law or statute is binding on those who are subject to it

o The interpretive rule is not itself binding o To determine whether a rule is a legislative or non-legislative rule courts will consider the

agency's characterization of the rule and the source of duty that the agency is obligated to obey

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If an agency is describing with greater clarity or precision a duty that a statute or regulation has already established, a court will conclude that the agency has issued a non-legislative rule

If a court determines that the agency is creating an entirely new duty, it will hold that the agency has violated 553 by failure to use rulemaking procedures

Reliance on non-legislative rules o Never found a case of estoppel against the government o Due process violations o Appeal of Eno, state case, court held that due process clause my apply in a case of

reasonable reliance if a state misleads a citizen in a manner that is fundamentally unfair Judicial Review of non-legislative rules

o Skidmore v. Swift Court engaged in interpreting a statutory provision should take into account an

agency interpretation of that provision, but if the agency's interpretation was not controlling on the courts

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

Christensen: interpretations contained in policy statements, agency manuals, and enforcement guidelines, all of which lack the force of law - do not warrant Chevron deference

Mead: Chevron applies when it appears that congress delegated authority to the agency generally to make rules carrying the force of law and that the agency interpretation claiming deference was promulgated in the exercise of that authority

Barnhart: Chevron might be appropriate even if an agency did not issue an interpretation that had the force of law

To determine whether Chevron deference is appropriate, courts should consider the interpretive method used and the nature of the question at issue

The court then held that the interstitial nature of the legal question, the related expertise of the agency, the importance of the question to administration of the statute, the complexity of that administration, and the careful consideration the agency has given the question over a long period of time

Chevron-like deference does not apply to every agency interpretation of a statute, though just when it does apply is not clear right now. Interpretations of statutes emerging from rulemaking, formal adjudication, or other things that have the force of law are not problematic. But others, like interpretations of statutes that do not have the force of law (such as some of those emerging from informal adjudication, and nonlegislative rules), fall into a grayer area. Under Walton, the Court examines the centrality of the gap in the statute (seemingly the most important factor), the expertise of the agency, the amount of attention the agency gave the issue, and so on. In some cases--as in Walton itself--using this sort of analysis may mean giving Chevron-like deference even to policy statements or interpretive rules interpreting statutes. Otherwise, agencies get Skidmore.

- Reviewability46


- When can you get a court to review something an agency did? o Need: CAUSE OF ACTION

Agencies own statute might provide, if not look to APA 702 right of review 702: a person suffering legal wrong because of agency action or adversely

affected or aggrieved by agency action within the meaning of a relevant statute Need to show:

Whether this case is excluded from review 701(a) exclusions from review

Statutes preclude judicial review (a)(2) agency action is committed to agency

discretion by law -- cannot get judicial review P must have suffered a legal wrong because of agency action

Legal wrong Agency action OR injury within 201 of agency's statute

Timing: Three requirements: finality, exhaustion, ripeness

Standing basics - States sometimes have broader standing rules than federal courts

o Sticking to federal standards here - Main elements

o Constitutional requirements Injury-in-fact

Has to be an actual injury that you have suffered or will in the near future

Concrete and particularized Causation

Can show the action lead to the injury Redressability

Are we in the right forum - would the relief you are requesting from the forum cure the injury

o Prudential requirements Zone of interest Generalized grievance Third party grievances

- Associational Standing: Allows a club to sue on behalf of one of its members o Subject matter of the case has to relate to the organization o Member of the club has standing

1. In order to be able to review an agency action in an article III court, you must have standing, jurisdiction (which is generally available from 42 U.S.C. § 1331), and a cause of action (generally available from (APA) 5 U.S.C § 702, subject to the limits of (APA) 5 U.S.C. § 701 and the timing requirements of finality, exhaustion, and ripeness). Individual statutes may expand, contract, or change jurisdiction or the cause of action.

2. The doctrine of primary jurisdiction may require that a case between two private parties be sent to an agency for determination of an issue that is within that agency’s purview.

3. The constitutional requirements for standing are injury in fact, causation, and redressability.4. Prudential requirements include not allowing generalized grievances, and not allowing plaintiffs

to litigate issues that are foremost about the interests of third parties. The prudential

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requirements can be eliminated by statute, such as the APA’s broad grant of standing to any interested party, or, if the APA does not apply, by specific broadening in a particular statute. Thus, these two prudential elements generally are eliminated in administrative law. A third prudential requirement, that plaintiff be in the zone of interests of the statute, will be discussed later.

5. An association can have standing without itself suffering an injury in fact and despite the prudential limit on third party standing, if three factors are in place. One of the members of the group must have standing to bring the suit; the organization’s purpose must be related to the subject of the litigation; and the suit must be for declaratory or injunctive relief rather than damages (the latter of which any § 702 case will be anyway, so we don’t usually bother with that factor in this class).

6. Injury in fact means that the plaintiff has suffered or is about to suffer a concrete and particularized injury. This can include economic or physical injuries, but also such things as aesthetic or recreational injuries. It does not include speculative future injuries, nor does it include generalized, abstract injuries like violating an interest in seeing the law properly followed or tax dollars well-spent.

7. Causation means that the injury is fairly traceable to the defendant’s challenged action. Redressability requires that the relief that plaintiff has requested would likely redress the injury.

Litigating of standing - Elements of associational standing

o Member who has standingo How the lawsuit related to the reason the organization exists

- If seeking injunctive relief, have to show that there is something the injunction would fix - Lujan v. Defenders of Wildlife: Under Article III of the Constitution, a party does not have

standing to litigate a generalized grievance against the government in federal court if she suffered no personal injury other than the harm suffered by all citizens.

Procedural injuries: - Court will typically make a key assumption that if the procedure is done properly, we will

assume you will get the result you want o Assume the favorable rule will come out - you still need to show that the favorable rule

would redress injury - Clapper v. Amnesty international USA

o Threatened injury must be certainly impending to constitute injury in fact for purposes of Article III standing.

o For the plaintiffs’ speculations to come true, five separate occurrences must come to fruition:

(1) the government must decide to target individuals with whom the plaintiffs communicate;

(2) the government must target those individuals with their powers under FISA versus some other surveillance authority;

Causation (3) the Foreign Intelligence Surveillance Court judge must rule that the

government satisfied the requirements of FISA; (4) the government must actually intercept communications from these

individuals; and

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(5) the plaintiffs must actually be the ones communicating with the individuals when the communications are intercepted.

o National security cases: government gets extreme latitude - Spokeo: to demonstrate an injury in fact for purposes of establishing standing, a P must show

that the injury is particularized and concrete (2 separate things)

1. Courts are more skeptical and demanding in standing arguments when they are from third parties who are litigating about the manner in which someone else is being regulated.

2. Procedural injuries are a special case. If an agency has failed to fulfill a procedural requirement (e.g., not having adequate notice and comment before passing a regulation), this probably will not be a sufficient injury-in-fact without more (e.g., that the regulation in question will cause harm--economic or personal or aesthetic or whatever--to plaintiff). The Supreme Court has said, however, that procedural injuries represent a partial exception to the causation and redressability requirements (e.g., the plaintiff can get standing without showing that the regulation wouldn’t have passed in its injurious form had notice and comment been executed properly--note, though, that plaintiff would still need to show that if the regulation passed the way she wanted that it would redress her injury).

3. Standing does not require a nexus between the injury (e.g., the inability to go hiking somewhere) and the issue to be litigated on the merits (e.g., the underlying legality of building a dam). Standing is a pre-merits requirement.

4. Injury in fact is simple and straightforward in most cases—losing a lot of money or suffering a physical injury, for instance. But it can also be something intangible like a recreational or aesthetic injury. It can also be based not on being harmed directly but rather on a reasonable fear of being harmed. The keys are that the injury is concrete and particularized, and is actual or imminent.

5. Procedural injury: complaint that that the agency did not follow a procedure it is supposed to, dies not satisfy injury in fact often

Cause of Action - Must establish to sue - Can rely on 702

o 702 cause of action, 2 ways into court Suffered legal wrong

You are a regulated entity who was regulated wrong Adversely affected or aggrieved by agency action within the meaning of a

relevant statute Zone of interest requirement

- If the P has demonstrated the injury required for standing, that demonstration satisfies the need to show the adverse effect

o Question then is whether the adverse effect suffered by the P is within the meaning of a relevant statute

o Zone of interest test o Prudential standing o Requirement is not very stringent

- Zone of interest: focus on the what, not the who - Air courier conference of America: To establish standing to sue under § 702 of the APA, a

plaintiff must establish that he has suffered a legal wrong because of the challenged agency action, or is adversely affected or aggrieved by the agency action within the meaning of the relevant statute.

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- Match-E-Be-Nash-She-Wish Band of Pattawatomi Indians: Prudential standing is satisfied when the injury asserted arguably falls within the zone of interests to be protected or regulated by the statute in question.

- Regulated entities and standing o When an agency regulates a person, that person always has a cause of action under

section 702 to challenge the lawfulness of that regulation o No requirement for the person to show he is within any particular zone of interests of

the statuteo If you are a regulated entity, not a third party, don’t worry about zone of interest - its

not a requirement for you, just deal with constitutional standing elements o Zone of interest is only for 3rd parties

- Exclusions from judicial review under the APA (446) o Statutory preclusion

Section 701(a) provides that the APA judicial review provisions apply "except to the extent that (1) statutes preclude judicial review; or (2) agency action is committed to agency discretion by law"

(1) Statute can say that you cant get review sometimes Pretty rare for a statute to say that Strong presumption in favor of reviewability Even if it does say something is unreviewable, might not be

constitutional Might be a separation of powers issue

- Abbott Labs v. Gardner: o In determining whether a case or controversy is ripe for adjudication, a court must

evaluate the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration.

o Judicial review of a final agency action by an aggrieved person will not be cut off unless Congress clearly intended to prevent such review.

- Block v. Community Nutrition – implicit preclusion o Whether and to what extent a particular statute precludes judicial review of an agency

action is not only based on the express language of the statute, but also on the structure of the statutory scheme, its objectives, its legislative history, and the nature of the administrative action involved.

o Presumption of reviewability can be overcome Structure of the statute Who can/cannot get review Case history/legislative history

o Standard: is congress's intent fairly discernable Not clear and convincing

1. The zone of interests (ZOI) test is a prudential standing requirement that applies in third-party sorts of cases (and not to regulated entities suing to challenge regulations being applied to them). It requires that the plaintiff be within the ZOI of the statute that he or she claims has been violated. This requirement is derived from § 702 and applies only to cases in which the cause of action is the third-party one from § 702. In other words, if the plaintiff is a regulated entity suing about the way it is being regulated, the ZOI requirement is irrelevant.

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2. In determining the ZOI of a statute, one must examine the particular provision alleged to have been violated, but in the context of the entire statutory scheme. A ZOI argument does not entail showing that Congress specifically intended for plaintiff’s group to be protected. Rather, it need only be shown that Congress intended to deal with the interests that plaintiff is dealing with. In other words, look for “what” and not “who” when gauging the zone of interests. Also, it need only be shown that Congress arguably intended to protect the interest in question--this can be construed fairly broadly.

3. Although the APA provides for broad Article III reviewability of agency action, § 701(a) provides for two exceptions from reviewability. The first, (a)(1), is for when the statute precludes reviewability.

4. Preclusion can be explicit or implicit. Express preclusion is rare, and generally not total. Indeed, total preclusion of judicial review of an agency’s actions may be unconstitutional, especially when the agency’s action is being challenged on constitutional grounds. Moreover, courts will read preclusive language narrowly, because there is a general presumption in favor of reviewability.

5. Implicit preclusion under § 701(a)(1) is a more complicated proposition. In the absence of express preclusion, a court will find that Congress has precluded judicial review of agency action only when congressional intent to do so is fairly discernable from the structure of the statute and/or the legislative history. Courts may speak of a “clear and convincing evidence” test, but they are not that strict in practice. Still, it’s not easy to show.

6. The second exception in 5 U.S.C. § 701(a), for matters committed to agency discretion, resembles the political question doctrine from constitutional law. The question here is not whether the agency is given discretion--that would eliminate almost all reviewability. Rather, the issue is whether the matter is wholly within the agency’s discretion, such that there is no basis for a court to act. This may be because of traditional limits on courts (such as when an agency is given “prosecutorial discretion”) or simply because the statute gives no external standards to guide the agency or to adjudge its actions against.

7. The § 701(a)(2) “committed to agency discretion” test can be summed up by asking whether the statute gives the reviewing court any “law to apply.” If there is no law to apply--i.e. there are no external standards that constrain the agency and that a court can apply in reviewing the agency’s decision--then the matter is committed solely to agency discretion and is unreviewable. As a result, constitutional claims are generally reviewable, because constitutional claims generally represent external standards, and are rarely left up to someone besides the court to apply.

Agency Action- When review under APA is not precluded 701, next question is whether the APA provides for

review - 702 provides "a person suffering legal wrong because of agency action, or adversely affected or

aggrieved by agency action within the meaning of the relevant statute, is entitled to judicial review thereof"

o APA only provides review of agency action Agency action: the whole or part of an agency rule, order, license, sanction,

relief or the equivalent or denial thereof, or failure to act - If seeking review, of agency action, has to actually be an agency action

o Not everything an agency does qualifies as agency action- 704: agency action reviewable, FINAL agency action

o Basis of the finality requirement - 706: standard of review

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o Allows the court to compel agency action unlawfully withheld/unreasonable delayed, and to hold unlawful/set aside agency action

Timing: - Three principles impact on the timing of judicial review - Party can obtain judicial review only of final agency actions unless congress has authorized

review at an earlier stage - Finality o 704: "agency action made reviewable by statute and final agency action for which there

is no adequate remedy in court" are judicially reviewable o Don’t want a court to review what the agency has done, until the agency is actually

done Want something to review - squarely presented conflict, don’t want to have to

speculate what they might do in the future Finality = more complete record

o If a statute says reviewable - go by the statute, not the APA o If no statute, 704 restricts review to final agency action o Abbott laboratories

To determine when an agency action is final, whether its impact is sufficiently direct and immediate and has a direct effect on day to day business

Agency action is not final if it is only the ruing of a subordinate official or tentative

Core question: whether the agency has completed its decision making process and whether the result of that process is one that will directly affect the parties

o Bennett v. Spear, 1997 : For an agency action to be final it must be one by which rights or obligations have been determined or from which legal consequences will flow

To determine whether an agency action is final, courts consider: (1) whether the challenged action is a definitive statement of the agency’s

position; o Meaning, is this communication from the agency saying definitively

that this is the agency's decision v. the judgment of the employee of someone from the agency

Does that person have the authority to bind the agency (2) whether the actions have the status of laws with penalties for

noncompliance; (3) whether the impact on the plaintiff is direct and immediate; and

o Legal affect? (4) whether immediate compliance was expected.

TEST for finality o Is it definitive of the agency's position - is the person speaking for the agency

Challenged agency action should be definitive of the agency's position o Do legal consequences flow from the action

are there legal consequences

- A party may have to exhaust any administrative remedies as a prerequisite to judicial review - exhaustion

o Have to exhaust all available remedies before court

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o To determine whether exhaustion is required, courts must balance the interest of the individual in retaining prompt access to a federal judicial forum against institutional interests favoring exhaustion.

There are three broad sets of circumstances where an individual’s interests heavily weigh against requiring administrative exhaustion:

(1) when requiring resort to administrative remedies may cause undue prejudice in a subsequent court action;

Ie. Diabetic example, needs to hurry (2) when an administrative remedy would be inadequate because of

some doubt as to whether the agency has the power to grant effective relief; and

Very common way to say exhaustion doesn’t apply, constitutional challenge, agency cannot deal with that

(3) when an administrative remedy would be inadequate because the administrative body is shown to be biased or has otherwise predetermined the issue.

Bias/futility Bar for this is extremely high Not just that you are going to lose, but that its true bias Following precedent/tight standards is not bias Example: the warden is doing this thing to me, the warden is the

one who decides - A party can obtain judicial review of any agency action only if that action is ripe for review -

ripeness o Relates to the proper time for a court to review agency action o Judge-made o Timing on the case

Ready for judicial resolution Pure Legal question Factual question - do you have all the facts?

Balance of hardships to the parties Finality

o A determination of ripeness requires an analysis of (1) whether the case is fit for judicial review, and (2) whether withholding review would create hardship for the parties.

o A regulation is not ripe for judicial review until the scope of the controversy has been reduced to manageable proportions, and its factual components fleshed out, by some concrete action applying the regulation to the claimant’s situation in a fashion that harms or threatens to harm him.

o- Three separate doctrines, need all, all really overlap though

1. Judicial review of agency action requires just that--agency action--so it can be hard to get review of a failure to act by the agency. The Supreme Court has required in cases where plaintiff is challenging the agency’s failure to act that the plaintiff show that the agency (1) has failed to take a discrete action like making a rule, issuing an order or license, granting relief, or leveling a sanction; and (2) that the agency was required by law to take that discrete action. The agency’s mere failure to exercise its discretion in a certain way, therefore, is not reviewable.

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2. The three timing doctrines we will discuss are finality, exhaustion, and ripeness, which overlap and blend into each other a fair amount.

3. Finality asks whether the agency has completed an action, because only completed actions are supposed to be reviewable. It is specifically required by 5 U.S.C. § 704. There are two parts of the requirement. First, is the agency action the consummation of the agency’s involvement? That is, is it definitive of the agency’s position as opposed to being merely tentative? Second, do legal consequences flow from the action? For instance, would violating the action result in a penalty? Does it affect the legal status of the plaintiff (as opposed to just affecting practical concerns)? Is immediate compliance expected? The agency’s characterization of its own action is not dispositive.

1. Exhaustion, though it predates the APA, is required by § 704 too. Current exhaustion doctrine prevents courts from hearing cases where the plaintiff has failed to follow a mandatory internal agency procedure required by statute or rule. The plaintiff must, in other words, go through all mandatory agency procedures before bringing a case to an article III court for review. Individual issues each need to be exhausted this way too.

2. There are exceptions to the exhaustion requirement for cases in which exhaustion would cause unreasonable and prejudicial delay; the agency procedures do not provide for the type of relief sought; or in rare cases where the agency is so biased against plaintiff that it is futile to bother with exhaustion.

3. Ripeness asks whether a case is developed enough for a court to consider it. Ripeness requires that the case be ready for judicial resolution--that it concerns either a legal issue, or factual issues that are sufficiently developed. We must also balance the hardship that delay would cause the plaintiff against the interference that immediate review would present to the agency. The less the net hardship is on plaintiff, the more the case has to be ready for judicial resolution. Ripeness overlaps a fair amount with finality (which technically is a third element of ripeness) and exhaustion, and also with standing.

4. It is very important to consider, in deciding the balance-of-hardships part of the ripeness analysis, whether the agency’s enforcement power will be stayed pending that review. A stay accompanying review will increase the agency’s hardship from early review; the lack of one will increase the challenger’s hardship from waiting.

4.

Major themes Requirements to file suit

o In order to challenge agency action, the reviewing court must have jurisdiction, and the P must establish a cause of action

Exclusions from review o Section 701(a) of the APA provides that the judicial review chapter applies "except to the

extent that (1) statutes preclude judicial review; or (2) agency action is committed to agency discretion by law"

Statutory requirements for bringing APA suits o The subject of the suit must be final agency action, the P must either suffer legal wrong or

be adversely affected and within the zone of interests of an applicable statute, and the P must have exhausted any administrative remedies as required by section 704

Ripeness requirement o The court has created a prudential requirement that the suit must be ripe for review

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Executive Summary Subject matter jurisdiction

o In order the challenge agency action, a litigant must first establish that the reviewing court has subject matter jurisdiction to hear the case

o Statutory regimes sometimes contain jurisdictional provisions o §1331 USCA provides district courts have jurisdiction for all civil action under the

constitution/laws/treaties of the USA Standing requirements

o Injury in fact (or about to suffer an injury) o Caused by the alleged illegal action (or about to be caused) o Favorable court decision would remedy (or avoid) that injury -- redressability

Cause of action o Must establish a cause of action o 702 - fall back provision

Establishes a cause of action for "a person suffering legal wrong because agency action or adversely affected by agency action within the meaning of a relevant statute"

Legal wrong and zone of interest requirements o 702's cause of action is limited to persons suffering legal wrong or those adversely affected

or aggrieved within the meaning of a relevant statute o A legal wrong in the context of the APA means an action by the government that interferes

with a person's constitutional, statutory, or common law rights o The adversely affected or aggrieved language authorizes lawsuits by persons who asset

interests that are arguable within the zone of interests to be protected or regulated by the statute in question

Exclusions from judicial review under the APA o Section 701(a) states that the APA's judicial review provisions do not apply to the extent

that (1) statutes preclude judicial review; or (2) agency action is committed to agency discretion by law

Agency action o Section 702's right of review is limited to persons suffering legal wrong because of agency

action or adversely affected or aggrieved by agency action o Agency action defined by USC 551(13) means the whole or part of an agency rule, order,

license, sanction, relief, or the equivalent of denial thereof, or failure to act Finality requirement

o Under the APA Section 704 agency action made reviewable by statute and final agency action for which there is not adequate remedy in court are judicially reviewable

- Agency Structure- Constitution added checks and balances - Separation of powers principles

o Agencies -- Doesn’t really sit well with a strict notion of separation of powers o Agencies do all three (legislate, execute, adjudicate) o Take as a given that it is constitutional, up to a point… o Separation of powers approaches

Formalist approach Very strict, by the book, to the letter

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On separation of powers issues - don’t see it prevailing Glimpses of it, mostly in dissents

Functionalist approach More moderate views Don’t look strictly at the letter of the law, but looking at if the core

function is being impinged - Delegation of legislative power

o Non-delegation doctrine: the court, when it does, says that congress cannot delegate its legislative authority. Congress has to be the one to legislate.

Several incarnations of the non-delegation doctrine o First phase

Intelligible principle test: test that congress could give authority to to agencies that might look legislative, but as long as congress was guiding the agency, by an intelligible principle, it was constitutional

Needs to give standards o Second phase

Cannot have delegation to private individuals o Third phase

Intelligible principle test: what used to be considered un-Intelligible, now is fine. The test is the same, but the bar is much lower

If the court never sticks down anything as violating the non-delegation doctrine, what's the point?

The court interprets statutes in a more confined manner to make sure its not unconstitutional

Narrows statutory interpretation for the court Power of the non-delegation doctrine, what courts do to avoid striking down

statutes - Whitman v. American Trucking

o In a delegation challenge, the constitutional question is whether the statute has delegated legislative power to the agency.

o When Congress confers decision making authority to agencies, it must set forth in a legislative act an intelligible principle to which the person or body authorized to act is directed to conform.

o An agency may not cure an unlawful delegation of legislative power by adopting a limited construction of the statute because doing so is itself an exercise of unlawful legislative authority.

o The degree of agency discretion that is acceptable depends upon the scope of the power that Congress has conferred.

o Scalia: need substantial guidance more than an intelligible principle - Stern v. Marshall:

o It is unconstitutional for a bankruptcy court to issue a final judgment on a debtor’s compulsory counterclaim relating to a creditor’s proof of claim where the counterclaim is a state-law tort claim that is not necessarily resolved by the bankruptcy court’s decision on the creditor’s claim.

o Because bankruptcy courts are not Article III tribunals, they may not exercise “the judicial power of the United States.”

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o Absent “limited circumstances” as to which a “public rights” exception applies, the bankruptcy court lacks jurisdiction to enter a final judgment.

o Here, no public rights exception is available because Vickie’s counterclaim (1) is independent of federal bankruptcy law, (2) will not necessarily be resolved through the determination of Pierce’s

proof of claim, (3) is not limited to a narrow determination of facts regarding a particularized

area of law, (4) did not originate in the legislative or executive branch, (5) does not derive from a federal statutory scheme, and (6) is not entirely dependent upon the adjudication of a claim created by

federal law. o Public v. private rights

When there is no review in art III court Can get away with no review, public right and no structural violations

o If there is a personal right, if there is waiver, might be able to get away with no review -- such as the person getting into the business knowing that there was no art III review -- narrow exception, don’t go down that rabbit hole unless entirely necessary.

If constitutional claim, can always get into art III court

1. “Strong” views of separation of powers are formalist ones that require strict and technical separation. More moderate ones (which have prevailed) are functionalist. They look more forgivingly at whether the core power of a branch is being encroached upon unduly. Functionalists allow encroachments that formalists would not.

2. Congress can delegate quasi-legislative power to executive agencies, so long as the delegation contains an “intelligible principle” that constrains the agency’s discretion and provides a reviewing court with a way of knowing whether or not the agency is acting consistently with Congress’s desires. The more power is delegated, the more guidance must be given, up to “substantial guidance” for economy-wide legislation. The bar is fairly low even in the latter case, however, as we saw in Whitman.

3. The Supreme Court has not used the non-delegation doctrine to strike down any legislation since the 1930s. The doctrine is still powerful, though, because it leads the Court to narrowly interpret statutes to avoid constitutional problems, even if that means rejecting a more intuitive interpretation of the statute. To find the “intelligible principle” that constrains agency discretion and renders a statute constitutional, a court may have to look to external sources such as statutory structure and legislative intent.

4. The delegation of final judicial authority to non-Article III decision makers is potentially a violation of the separation of powers. The issue is when such entities get the last word on matters of law and fact; Article III review, even if deferential, generally suffices to save the constitutionality of any structure.

5. Cases involving so-called “public rights” can be handled completely by agency adjudicators (except to the extent that they involve constitutional claims). Public-right cases are cases in which an agency-as-regulator is a party, or cases between private parties that arise entirely out of the workings of a regulatory scheme.

6. Sometimes administrative adjudications have other, private claims, like state-law contract matters, attached to them. The courts may require Article III participation, but will not do so if the parties have voluntarily agreed to the administrative forum (waiving whatever “private right”

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claim they have to an Article III forum), or if there is no real threat to the core power of the Article III courts (so that there is no “structural” violation of Article III).

7. To repeat: Pretty much any constitutional issue with agency adjudication is rendered moot by the possibility of Article III review. In other words, what we are talking about here is when agency adjudicators get the last word over a dispute. If there is Article III review, then there is no problem, regardless of whether it’s arguably about a private right or whatever.

Legislative Veto

- Unconstitutional - Immigration and Naturalization Service v. Chadha

o Legislation providing Congress with a one-house veto over an action of the executive branch is unconstitutional because it does not meet the constitutional requirements of presentment and bicameralism.

Reins Act: - Pros of REINS

o Regulations good enough to be binding, then congress should be involved o Would be less regulation (if that is what you want)

- Cons o How much would actually get through? o Major rules would most likely get debated to death o Not indexed for inflation -- 100m sweeps in more and more every year

Chapter 6: Major Themes Separation of powers/checks and balances Administrative adjudications

o Agencies routinely adjudicate cases, subject to review by Art III courts, but under the substantial evidence standard that review is deferential as to the agencies factual determinations and under Chevron and Auer doctrines that review may be deferential as to the agencies interpretations of the law

o Constitutionality of ordinary agency adjudication seems well established under the public rights rubric, and the court has long sanctioned administrative adjudication of public rights without a right to jury trial because such adjudication does not constitute a suit at common law or in the nature of such a suit

The legislative veto o Struck down as a violation of bicameralism o Chadha

Congressional efforts to assert control over administrative agencies o After Chadha, congress took steps to reassert authority over agency decision making

through "corrections day" and the congressional review act o REINS Act

Appointments and removal o Art III, principal officers appointed by President with the advice and consent of the senate o Congress can appoint inferior officers o Constitution silent on removal (short of impeachment)

Presidential supervisory authority o President has a constitutional authority to require administrative officials do a number of

things:

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Prepare cost-benefit analysis Develop regulatory agendas File environmental reports Explain the reasons behind their proposed actions

Executive Summary

Separations of powers/checks and balances o Constitution envisions a federal government with separate and distinct branches of

government, assigns distinct tasks to each branch, and is based on the assumption that each of the branches will check and balance the powers of the other branches

o Administrative agencies fit awkwardly into the US constitution system - although almost all agencies are housed in the executive branch of government, many agencies exercise legislative, executive, and judicial powers

Nondelegation doctrine o Scotus has gone through three phases in evaluating delegations of power o Court rejected all non-delegation challenges until the 1930s, when it struct down 2 o Court has rejected all additional non-delegation since, but has used the non-delegation

clause to justify narrowly interpreting an agency's statutory authority Administrative adjudications

o Congress routinely assigns the power to adjudicate to persons other than Art III judges o Admin adjudication is a common example of such adjudication, but agencies are not the

only non-Art III adjudicators o Under the substantial evidence standard agency review is deferential as to the agencies

factual determinations and under the Chevron and Auer doctrines that review may be deferential as to the agencies interpretations of law

o Constitutionality of ordinary agency adjudication seems well established under the public rights rubric

Administrative adjudication and the right to jury trialo Administrative adjudication of public rights without a right to a jury trial because such

adjudication does not constitute a suit at common law or in the nature of such a suit o Jury trial required only if the P cause of action was a "Legal" claim at common law or if the

cause of action was unknown at common law but is analogous to a legal action at common law

The legislative vetoo Rulemaking veto's also unconstitutional

Post-legislative veto developments Appointments Removal power

o In general, the president has the power to remove executive branch officials o Need "for cause"

Presidential supervisory authority

1. The bicameralism and presentment requirement is viewed strictly (i.e., formalistically) by the Court. If an action is “legislative” in nature, it must be approved in identical form in both houses and approved by the President (or vetoed but then approved by 2/3 majorities in each house). As explained in INS v. Chadha, to be legislative in nature an action must have the “purpose and effect of altering . . . legal rights, duties and relations.” Note, though, that agency action that seemingly

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meets this definition, but which is pursuant to a congressional delegation of power with an intelligible principle, is still OK though.

2. Laws that give Congress the ability to efficiently review (and, if it wants, to overturn) rules are constitutional, so long as they require bicameralism and presentment to overturn the rule. The same is true of a law that would require Congress to affirm a rule before the rule could take effect. Giving some other part of the executive branch the power to affect passage is not a problem either, because that can be considered just another part of the rulemaking process, which is OK because it stays solely in the executive branch.

- Inspections, Reports, & Subpoenas- Inspections:

o A number of agencies regularly inspect buildings and word sites o Legal authority to inspect

Authority defined in enabling act o §657. Inspections, investigations, and recordkeeping o 14A agencies are subject to o 4A limitations on searches

No unreasonable, need warrants Agencies can inspect things and don’t need a warrant if it’s for something that

the owner has no expectation of privacy o Camara: warrant required; standard of PC reduced

Exceptions: ask consent/emergency/good faith failure of warranto 2 kinds of searches

Searching because of specific complaints - can get a warrant for those specific places (specific warrant) - could not use an excuse for whole factory

Whole factory - neutral plan warrant - general warrant o Trinity industries v. OSHRC: The probable cause justifying issuance of a warrant for

administrative purposes may be based on either specific evidence of an existing violation or a showing that reasonable legislative or administrative standards for conducting an inspection are satisfied with respect to a particular establishment.

o In re trinity industries: To determine whether a warrant application based on a general administrative plan for the enforcement of the Act is proper, courts must determine that the plan is based on specific, neutral criteria and that the warrant application clearly and adequately establishes that the particular company was selected for inspection pursuant to an application of such specific, neutral criteria.

To decide whether a warrant application meets these requirements, courts must:

(1) determine that the plan pursuant to which the warrant is to issue is based on specific, neutral criteria; and

(2) determine that the warrant application clearly and adequately establishes that the particular company was selected for inspection pursuant to an application of the plan’s neutral criteria.

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o Patel: The warrantless search of hotel records for general inspection purposes does not fall under the administrative-search exception to the warrant requirement of the Fourth Amendment.

Even if hotels are determined to be closely regulated, warrantless inspections must:

(1) serve a substantial governmental interest, (2) be necessary to further the interest, and (3) be of adequate certainty and regularity

Remedies for illegal inspections Whether the exclusionary rule can apply (illegal search found evidence) under the 4A Exclusionary rule, judge-made

o If excluding the evidence wont deter illegal searches from happening, don’t use it o Janis - looked at evidence obtained by state criminal investigators, feds were using it. Actors

were separate, doesn’t fit o A lot of these cases, don’t go to trial o Scotus skeptical of the exclusionary rule, reluctant to extend it to where it doesn’t really

exist Exclusionary rule is there, and maybe can be used in an extreme enough case

o Look out for the disconnect between the finders and the users o Make sure facts are egregious before you suggest it

1. Agencies have two main limits on their ability to perform searches and inspections, etc. First, Congress must authorize the agency to do so, and Congress usually limits and specifically defines the bounds of an agency’s search powers. Second, the Fourth Amendment requires that searches be reasonable and that warrants (where they are required) be specific and based on probable cause. But warrants are not required where there is no expectation of privacy, or where there is consent to a search or seizure, among other exceptions. They are also not required for searches of “pervasively regulated” entities if the warrantless search has an important governmental purpose and the agency’s process offers other protections.

2. Even though a general warrant authorizing a general search would seem to violate the Fourth Amendment, it may nevertheless be enforced in certain situations. Even there, though, the search must be based on a general and prospective plan, neutrally applied--this limits the scope of such searches. For a more specific search (such as one arising out of a specific complaint), an agency must generally meet the Fourth Amendment’s probable cause and specificity requirements, and the warrant will be limited to that which is complained about.

Recordkeeping and reporting requirements

- Multiple ways that the government can obtain it - Recordkeeping requirements imposed on persons, which is one way that the government is able

to generate information - usually imposed by regulations - If expressly provided in statute, agencies can issue subpoenas

o Subpoenas ad testificandum: requires a person to come and testify o Subpoenas duces tecum: require a person to come and bring something with him,

usually documents - A person receiving a subpoena has three options

o Comply with it o Go to court to squash

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o Ignore it - Census form is an example of this/ same with taxes - Statute makes agency to do recordkeeping/reporting requirements, do they need rulemaking

o APA does not require notice and comment o While some reporting requirements might not be established by rule, others are o Authority comes from the statute o Paperwork reduction act

Statutory authority and limitations - Statutory authority:

o Agency must have statutory authority for any reporting or record keeping requirements that it imposes

o When the reporting/record keeping requirements is imposed by regulation, the agency need not show express authority for that requirement

- Administrative procedure act o When an agency imposes a reporting or record keeping requirement by regulation, the

rule making requirements of the APA apply o In re FTC Line of Business report litigation

DC cir held that information gathering need not be imposed by rulemaking - The paperwork reduction act (PRA)

o When an agency wishes to impose a reporting or recordkeeping requirement on 10+ persons, the paperwork reduction action imposes substantive and procedural requirements on the agency

o Applies to any reporting requirement o Don’t forget this was one of the hybrid rulemaking requirements too o Does not include

Less than 10 people Criminal investigations Civil discovery

o About regulatory record keeping o Requires

There be an office in each agency that reviews information collecting that critically analyzes the requirements that the agency sets out

Page 690-91 factors to look at Necessary, compatible, allowances for small business, etc. Congress wanted to make sure burdens weren't redundant Requires the things to be certified

o OIRA - required to review any information gathering the agency wants to do, and give comments - never rejected reporting requirement on this basis, but it does have the power to do that

When OIRA is done, issue a control number Control number: allows agencies to systematize/catalogue all of their

things If there is no control number, they cannot penalize you for failing to comply

Be careful, source of duty requirement, can penalize if the source of the duty to report the information is the statute (if its just the agency, need the control number)

o Also requires notice and comment

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Don’t have to go through notice and comment rulemaking to make the reporting requirement, but still need notice and comment

Not 553 of APA, but still notice and comment Need notice and 60d for comment Don’t have all the other hoops of 553

Major Themes: Agencies seek information for a variety of reasons, and for a variety of purposes One wat that agencies obtain information is through inspections of businesses and regulated

entities. Inspections are subject to the warrant requirement of the 4A, but that requirement is applied in a unique way in this context

Other ways that agencies obtain information is through requiring regulated entities to keep records and through the issuance of subpoenas

In general, agencies must have authority to issue subpoenas, and their attempts to obtain information are subject to constitutional requirements

Executive summary

Administrative agencies need information to perform their many functions o Use the info to set policy through the promulgation of rules and regulations, to keep

congress advised regarding various matters, and to enforce regulatory requirements and prosecute companies for civil and criminal violations

o Obtain info in different ways Conduct inspections/searches of areas Require persons to submit info/produce documents to the agency Require persons to keep records that they can inspect

Administrative inspections o Number of agencies regularly inspect buildings and work sites

Agency authority to inspect o Agency's authority to inspect is defined in its enabling act o If congress (or state legislature) has not authorized agency to conduct inspections, it has no

legal authority to do so o Authority to inspect is only as great as its statutory authorization

4A requirements o Camara v. Municipal Court, scotus, 1967

Held that administrative inspections are subject to the requirements of the 4A o Absent consent (or 4A exception) such inspections require a search warrant that is based on

PC and otherwise complies with the requirements of the 4A o Court redefined concept of PC in administrative context

PC does not require proof regarding specific violations or misconduct at a particular place, but can instead be based on such things as proof that there was a reasonable inspection plan and that it was time to search under that plan

Pervasively regulated industries o Exception to the warrant requirement exists for pervasively regulated industrieso In such cases, the court asks only whether the searches serve an important governmental

purpose, whether warrantless searches are necessary to achieve that purpose, and whether the statute authorizing the searches provides protections that substitute for a warrant

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(providing notice of searches to the owner, limiting the scope of the search, and limiting the discretion of the inspecting officer)

Remedies for illegal inspections o To the extent that officials enter a home or business without authority, they may be liable in

tort under state law (trespass) o Might also be liable under federal law o 4a violations o Exclusionary rule

Special needs searches Border searches

o Border searches as routine, customs officials broad powers Recordkeeping requirements

o Recordkeeping requirements are used by agencies to generate information, usually imposed by regulation

o Authority may be implied by statute o If agency wishes to issue subpoena or report order, or impose a reporting requirement by

letter, authority must be explicit Paperwork reduction act

o When an agency wishes to impose a reporting or recordkeeping requirement on 10+ persons, the paperwork reduction act imposes substantive and procedural requirements on the agency

Agency Subpoenas o If expressly provided by statute. Agencies can issue subpoenas o Subpoenas ad testificandum: requires a person to come and testify o Subpoenas duces tecum: require a person to come and bring something with him, usually

documents o Usually used when agency is investigating possible violations of its regulations or governing

statute o A person receiving a subpoena has three options

Comply with it Go to court to squash Ignore it

o Historically no penalty for ignoring, now there is some 4A and subpoenas

o Early scotus decisions limited agency power of subpoenas o Oklahoma press publishing co v. Walling, 1946

Court held that PC was not necessary to the validity of an administrative subpoena, and held that the disclosure shall not be unreasonable

o It is not necessary, as in the case of a warrant, that a specific charge or complaint of violation be pending or that the order be made pursuant to one

5A privilege against self-incrimination o Scotus determined that a corporation cannot resist the production of records upon the

grounds of self-incrimination o 5A privilege only to individuals

5A exceptions Parallel proceedings

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1. Remedies for an unconstitutional search or seizure by an agency are the same as in other contexts: Bivens actions or the application of the exclusionary rule. It is very rare, however, for the exclusionary rule to be used in the administrative, as opposed to criminal, context. Use of exclusion must be an effective deterrent, and the violation must have been quite egregious.

2. Recordkeeping and reporting requirements are another tool of administrative agencies. Some statutes establish such requirements directly and leave it to the agency to provide more detail; others just authorize the agency to establish requirements. This authorization may or may not require that reporting requirements be established through the rulemaking process. Administrative subpoenas may be issued, but the authority to do so must be given to the agency expressly by statute.

3. The Paperwork Reduction Act, 44 U.S.C. § 3501 et seq., which applies to any reporting requirement that affects 10 or more people (besides criminal investigations and civil discovery), requires agencies to subject a new reporting requirement to notice and comment, and to critically analyze the requirements to make sure that it is necessary, compatible with existing requirements, makes allowances for small businesses, not confusing, etc. Also, OMB/OIRA must sign off on it and assign a control number to the reporting/record requirement.

- Public Access- Requirement of electorate having sufficient info to make informed choices - Two themes: [supporting public access to government decision making] v [supporting

confidentiality in government decision making] Freedom of information act (FOIA)

- Section 552 APA - Promotes accountability – can see what they have done, directly accountable - Deterrence: the agency knows that the records are going to be public- 552(a)(3) requires agencies "upon request for records which reasonably describes such records

and is made in accordance with published rules stating the time, place, and fees (if any), and procedures to be followed, shall make the records promptly available to any person"

- 552(b) has 9 specific exceptions from this general requirement o Classified informationo Infernal agency personnel rules and practices o Information specifically exempted from disclosure by statute o Private commercial or trade secret information o Inter-agency or intra-agency privilege communications o Personnel, medical, or similar files the disclosure of which would constitute a clearly

unwarranted invasion of privacy o Information complied for law enforcement purposes o Information related to reports for or by an agency involved in regulating financial

institutions; and o Geological information concerning wells

- Making a request o Informal channels, might as well ask o Actual FOIA request

Every agency is required by FOIA to pass procedural rules explaining how the agency handles FOIA requests in that agency

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Office, location, contact person, index, fees, exceptions to the fees, - FOIA time limits: not really followed - FOIA fees:

o Intended users, paying for copies after first 100 pages o Second intended users, copies after 100 and search costs o Commercial users, copies after 100, search costs, review costs o Money goes to treasury

- Judicial Review under FOIA o Burden of proof is on agency unless statute shifts it o Review de novo

- FOIA Request: very broad o Details: has to be reasonable in its specificity and has to reasonably track the methods

that the agencies use to store the records (usually the index) - The bureay of national affairs v. US DOJ

o FOIA authorizes the disclosure of “agency records” upon request, but the statute does not provide guidance regarding the meaning of this term. An agency employee’s records are not necessarily “agency records” for the purposes of FOIA simply because those records are physically located within the agency. When determining whether a document is an “agency record” under FOIA, courts must focus on the totality of the circumstances. '

o This involves a consideration of several factors, including (1) whether the documents were in the agency’s control; (2) whether the documents were generated within the agency; (3) whether the documents were placed into the agency’s files; and (4) whether and to what extent the employee who created the document used that document to conduct agency business.

Who made it Who used it Where is it now Who controls it

- The Freedom of Information Act (FOIA, 5 U.S.C. § 552) represents a strong statement on the side of openness in the balance between the needs for accountability and confidentiality. It gives anyone the ability to obtain public records from an agency. On the other hand, it is often slow in its workings, and it is subject to numerous exemptions.

- FOIA is highly bureaucratized, and often those seeking information do better going through informal channels. Formally, though, agencies must have their own rules (promulgated pursuant to FOIA) telling would-be FOIA requestors the who, what, and where of the agency’s records.

- FOIA requires that the agency reply to a request within 20 days, a time limit that is widely violated. Courts will allow judicial review after 20 days, and the agency’s ability to collect fees is affected if they violate the limit, but most requesters decide just to wait rather than alienate the agency and spend money on litigation that they might not get back.

- Agencies expend resources in reviewing requests, finding documents, and copying and shipping documents. Requesters must pay the government for copies after a certain amount. Non-educational/non-scholarly/non-news requestors must pay some search costs too. Commercial requestors--who represent the bulk of FOIA requests--must pay for all of this plus some review costs.

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- FOIA has its own judicial review provisions that, unlike the APA default provisions, put the burden of proof on the agency rather than the proponent. Review is de novo, and not limited to the agency record. If the agency loses the case it must pay the plaintiff’s fees and costs.

- A FOIA request must be reasonable in its specificity. This includes not just clarity in what is being sought, but also with reference to the index: agencies have indexes that spell out what records they have and where, and the request must track the index to make it reasonable for the agency to be able to find the documents.

- Agencies only must turn over “agency records.” Whether something is an agency record depends on balancing whether the agency or someone else created, stores, controls, and/or uses the record. Use must be in the pursuit of agency business (e.g., meeting agendas), not just for personal convenience (e.g., desk calendars).

FOIA Exceptions --permitted Most common form of litigation under FOIA denial is a challenge to an agency's determination

that certain records are exempt under 1+ of the FOIA exceptions o Most common review, document falls under exceptions of FOIA, argument that the

document does not fall under one of the exceptions Discovery rule: requires agencies to provide the court and P with an itemized "index" of withheld

records (Vaughn Index) o Index must contain a description of each document or withheld portion and a detailed

justification of the agency's grounds for withholding, specifying which exemptions apply to each record or portion withheld

Classified information o National security information, classified pursuant to executive order o Glomar denial - denying FOIA requests on the ground that it could neither confirm nor deny

the existence of such records o Sensitive but unclassified (SBU) o President has been given wide discretion on their classification of national security

Internal personnel rules o Matters related solely to the internal personnel rules and practices of an agency o Exception applies only to matters "relating solely to the internal management of an agency" o Exception is concerned with the conditions of employment in federal agencies - such as

matters as hiring, firing, work rules, and discipline, compensation and benefits. o Exclusively internal personal rules

Specifically exempted by statute o Some other statute says "notwithstanding FOIA, this agency does not have to hand over

these records" o Construed narrowly o 2009: a law passed after 2009 amendment must cite to exception 3 in order to be a law

specifically exempting a record from disclosure Confidential business information

o Trade secrets and commercial or financial information if it is obtained from a person and is either privileged or confidential

o Require the information to be commercially valuable, used in ones business, and maintained by the company in secrecy

o Info must be obtained form a person, not generated by the government itself, but the person who provided the information need not be to whom the information relates

o Most important

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o Trade secrets and confidential business info o Sometimes regulated entities submit info to regulators that they don’t want their

competitors to see Inter- or intra-agency memoranda

o It exempts inter-agency or intra-agency memoranda and letters "which would not be available by law to a party other than an agency in litigation with the agency"

o 5 privileges Deliberative process privilege material Attorney work-product Attorney-client confidential communications Confidential commercial information of the government itself Factual statements made to air crash investigators

o Deliberate process privilege (Nixon v. US) Intended to protect open and frank advice and recommendations from government

employees to the superiors to that government officials will receive the fullest and most candid advice

o If documents that would have qualified for exception 5 have been released to 3rd parties, the privilege is generally considered waived

Personal privacy o Personnel and medical files and similar files the disclosure of which would constitute a

clearly unwarranted invasion of privacy o Balancing between public interest in disclosing information and the private interest in

maintaining confidentiality Records that contain personal or intimate details of a persons life require a very

strong public interest to justify a determination that the invasion is warranted o Applies to people, not corporationso Privacy interests generally lapse upon the persons death o Redact the private information

Law enforcement records o 1966: generally exempted investigatory files compiled for law enforcement purposes o 1974 amendment:

Exempting investigatory records compiled for law enforcement purposes, but only if the record would cause 1 of 6 specified harms:

1. Interfere with enforcement proceedings 2. Deprive a person of a fair trial 3. Constitute an unwarranted invasion of privacy4. Disclose the identity of a confidential source 5. Disclose confidential investigative techniques and procedures 6. Endanger the life or safety of law enforcement personnel

o 1986 amendment Eliminated the requirement that the records be investigatory records The likelihood that disclosure would result in one of the specified harms was reduced

from would occur to could reasonable be expected to occur Confidential sources were defined to include ant person, any private institution, or

any state, local, or foreign agency that furnishes information on a confidential basis

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The presumption that information from a confidential source would identify the source was extended to any information provided by the confidential source, not just the confidential information provided solely by the source

Broadened the range of documents that would constitute harm to law enforcement investigative techniques, practices, guidelines

Endangering the life or safety of any person, not just law enforcement Financial institution records and well data

o Protect the information about financial institutions which the government collects in the course of its regulatory functions

Oil well data

Reverse FOIA Suits – original submitter wants agency not to release the document - Ask: is there some other source of a duty to withhild the document

Executive order (EO) 12600 o Orders each agency to set up their own procedures that tell submitters that someone has

requested their confidential business information, give the submitter a change to argue that it is confidential and if the agency can release it, they should not -- gives the submitter its due process

1. There are numerous exemptions from FOIA, including national security, internal personnel rules, explicit statutory exemption, trade secrets and confidential business information, privileged material, privacy-sensitive material, and law enforcement materials.

2. The most complicated FOIA exemption is for confidential business information. Something is exempt under this provision if it was either (1) voluntarily given to the government but is not of a sort ordinarily disclosed to the public; or (2) required to be given to the government but its release would cause substantial competitive harm to the submitter.

3. FOIA exemptions mean that the agency is not required to release the document to the requester. But they do not forbid the agency from releasing the document anyway, if it so chooses. In making the decision of whether or not to release a document with confidential business information, E.O. 12600 requires agencies to set up a process to (in some cases) notify and get the views of the entity that originally submitted the document.

4. So-called “reverse FOIA” suits allow the submitter of information to sue the government to prevent disclosure. FOIA only provides for when disclosure is required, not when it is forbidden, so it is never the basis of a reverse FOIA suit. But if the submitter has some other basis for requiring non-disclosure (e.g., the Trade Secrets Act, 18 U.S.C. § 1905, to take just one example), it can use APA § 702 as a cause of action to prevent disclosure.

Federal Advisory Committee Act (FACA)

1972 Congress passed the federal advisory committee act o Imposes limitations on the executive branch used for advice of committees that include

private persons o Not used to provide public access successfully o Because of a concern of private interest groups having an undue bias and secret influence

on government policy (directed at executive agencies only) o Efficiency, balance, transparency

Concern of government waste Aimed at monitoring the number and expenses of advisory committees and reducing their

number

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Also creates substantial bureaucratic to the creation of new advisory committees Requires that no new advisory committee be established unless the president or statute

specifically authorizes its creation or the head of an agency determines "as a matter of formal record, after consultation with the Administrator of general services, that such establishment is in the public interest in connection with the performance of duties imposed on that agency by law"

Charter must contain: o Advisory committee's title o Purpose o Time necessary to carry out the purpose o Agency/official to whom it reports o Who is responsible for providing necessary support o Duties for which the committee is responsible o Estimated annual coast and number/frequency of meetings o Termination date o Date the chart is filed

o FACA sets 2y limit, president/agency can extend for 2y

Government in Sunshine act: Passed in 1976 Third of open government statutes Founded on the proposition that the government should conduct the public's business in public Fundamental requirement of the sunshine act is that every portion of every meeting of an agency

shall be open to public observation Federal version of opens meetings law Meeting needs to have a quorum and need to be making official decisions

Major Themes FOIA

o Freedom of information act provides individuals with the ability to access governmental information and documents

o FOIA is subject to various exemptionso Sometimes when agencies hold information about private individuals or corporations and a

FOIA request is received for that information, the individuals/corporations will bring a reverse FOIA suit to prevent the release of the information

Federal Advisory Committee Act o FACA o Limits the ability of the executive branch to create or use advisory committees that include

private persons, unless those committees comply with the act Government in the Sunshine Act

o Requires every portion of every meeting of an agency shall be open to public observation o Unlike FOIA, sunshine act only applies to agencies headed by a collegial body, but the

requirement to have open meetings is subject to the same exceptions as FOIA except (b)(5) Executive Summary:

FOIA access o Provides public with the ability to access governmental materials and document

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o Disclosure statute so the assertion is that governmental agencies will turn over requested documents unless those documents fall within one of the FOIA exceptions

FOIA Exemptions o List of 9

Reverse FOIA suits o Private persons/organizations about whom the government has information may have a

very strong interest in whether the government releases information requested by someone o In some instances, these individuals will bring reverse FOIA suits to prevent the government

from disclosing this information to others. o Most reverse FOIA suits involves commercial information

Federal Advisory Committee Act o FACA o Limits the ability of the executive branch to create/use advisory committees that include

private persons unless the committees comply with FACA o FACA imposes a number of requirements that must be met in order to create an advisory

committee, including a requirement that membership in the committee be fairly balanced in terns of the points of view represented and the functions to be performed by the advisory committee

o No longer would advisory committees be industry advisory committees o FACA also requires that any meeting of an advisory committee be noticed to and open to

the public subject to the exceptions that mirror FOIA's exemptions Government in the Sunshine Act

o Requires that every portion of every meeting an of agency shall be open to public observation

o Sunshine act only applies to agencies that are headed by a collegial body composed of 2+ individual members, a majority of who are appointed to such a position by the president with the advice and consent of the senate and any subdivision thereof authorized to act on behalf of the agency

o Only multimember independent regulatory agencies are subject to this act o There must be a meeting of at least a quorum of members to the agency for the act to apply

The meeting also must involve deliberations that determine or result in the joint conduct or disposition of official agency business

o Act does not contain exceptions

1. The Federal Advisory Committee Act (FACA), 5 U.S.C. App. 2, § 1 et seq., requires that advisory committees that include non-governmental employees must be created only after a showing that the public interest requires it, with a charter setting forth its organizing principles, and a sunset date. Membership must be balanced and inclusive, there must be agency oversight and control of the committee, and the meetings must be noticed and open. Advice from individuals, or from bona fide government employees, or communications regarding facts instead of opinion are exempt.

2. The Government in the Sunshine Act, 5 U.S.C. § 552b, requires that agency meetings be open. “Agency” for these purposes is a collegial decision making body (usually an independent agency) appointed by the President and confirmed by the Senate. Thus the FCC or NLRB are subject to the Act, but the Attorney General meeting with subordinates would not be. A “meeting” under the act is one where official decision making occurs, and where there is a quorum. This leaves a lot out,

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and enforcement is weak in any case. There are also specific exceptions made for instances where secrecy is more warranted, similar to the exemptions in FOIA.

Attorney’s Fees- Traditionally, American Rule = each party in a case bears its own legal costs - Rest of the world, prevailing party gets legal costs - Suits against the government, attorney may be paid in several ways

o Contingency fee o Percentage (if lose, get nothing) o Agreements for payment based on hourly fee o Fixed fee

- Congress has often placed limits on attorney fees received for benefit suits - Some statutes take away the American Rule for attorney fees- Without fee shifting statute

o Under EAJA, win and substantially justified Essentially saying that you shouldn’t have had to defend the case

Equal Access to Justice Act Passed as a temporary measure in 1980, made permanent in 1985 Applied broadly to any non-tort action against the US and some agency adjudications Includes any ordinary APA judicial review cases and formal APA adjudications where the

government is represented by an attorney Prevailing party

Need not be completely successful to be considered prevailing o Have to receive at least some relief on the merits of his claim

Have to have gotten some part of what you are asking for in the case Only get fees for the hours for the part of the claim that you were successful on

HAVE TO BE PREVAILING PARTY AND THAT THE GOVERNMENTS POSITION IS NOT SUBSTANTIALLY JUSTIFIED - YOU GET ATTORNEY FEES - YAY

- Buckhannon Board o A prevailing party is one that has been awarded some relief by the court

- Barrios (don’t cite this) o Said you don’t need the stamp/consent of the court

- Roberson: prevailing party if court retains jurisdiction to enforce the settlement - Doe v. Boston public schools: need the stamp of the court

Substantially justified Concept in in EAJA that a prevailing party is entitled to a fee award unless the government's

position is substantially justified is relatively unusual and subject to some interpretation Governments position not substantially justified

o The government has the burden of showing they were substantially justified - if they cant meet that burden, you get your fees

Pierce v. Underwood: The EAJA provides that a prevailing party is entitled to an award of attorney’s fees unless the

government’s litigating position is “substantially justified.” o Could a reasonable person be satisfied

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o Not that you are showing that their position was unreasonable, need to show not that they were unreasonable, BUT that it was unreasonable for them to think that their position was reasonable Unreasonableness squared

Major Themes Recovery of attorneys fees

o In general, in the US, each side to litigation must pay his attorney fees -- American Rule o Congress has passed a few special fee shifting statutes, usually relating to a particular

substantive area of law when congress wanted to encourage, or at least not discourage, particular types of law suits

Equal access to justice act (EAJA) o EAJA is the most prominent fee shifting statute, permits the recovery of attorney fees in

litigation against the government, and applies broadly to any non-tort action against the US and some agency adjudications

o Act imposes limitations on those who may recover these fees, the requirements for recovery, and the amount of the recovery

Executive Summary

Fee shifting statutes o American rule and congress wanting to encourage particular types of lawsuits

Equal access to justice act (EAJA) o The act limits awards to individual P with a net worth of 2mil or less, businesses with fewer

than 500 employees and a net worth of less than 7mil, tax exempt charitable organizations, or any other organization that would qualify as a "small entity" under the regulatory flexibility act

EAJA's application o Extends its terms to formal adjudications under the APA at which the government is

represented by counsel, appeals of government contract disputes before one of several contract appeal boards, and administrative. Penalty proceedings under the program fraud civil remedies act

o In admin proceedings, the adjudicative officer shall award attorney fees to a prevailing party other than the US unless the adjudicative officer of the agency finds that the position of the agency was substantially justified or that special circumstances make the award unjust

Recovery under EAJA o Authorizes an award of costs (not including attorney fees) to any eligible prevailing party

without a further showing o Authorizes an award of attorney's fees to prevailing parties in suits with an agency on the

same basis that awards of attorneys fees can be made under common law (the exceptions to the American Rule)

o Authorizes attorney fees to a prevailing party other than the US unless the court finds that the position of the US was substantially justified or that special circumstances make an award unjust

Definition of "prevailing party" o Prevailing party -- litigant must succeed on any significant issue in the litigation o Technical victory may be so insignificant as to not support any prevailing party status o A P who recovers damages in any amount, qualifies as prevailing party o Success must be reflected in judicial decree

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"substantially justified" o Presumption that a prevailing party is entitled to a fee award unless the governments

position is substantially justified o Burden on the government to establish that its position is substantially justified

Amount of award o Base fees on prevailing market rates for the kind and quality of services furnished - cannot

exceed 125/h (unless justified) o Agency bad faith is grounds for an enhanced fee award

1. Several statutes allow a party who prevails in a case (or in part of one) against the government to get the government to pay the party’s legal costs. Besides specific statutes where Congress wants to help motivate lawyers to take cases, there is EAJA, which provides a general cause of action. In EAJA, however, one can only win fees upon prevailing and the government being unable to establish that its position was substantially justified (i.e., that it was reasonable for them to litigate it).

2. In all of these statutes, being a prevailing party requires some level of judicial imprimatur be placed on the victory--a judgment, a consent decree, or possibly even a settlement in which the court retains jurisdiction all suffice; a plain settlement or a voluntary cessation of the complained-of conduct do not suffice (though Congress recently broadened FOIA’s fee-shifting provision to allow victories in FOIA cases like that).

3. For EAJA purposes, the government will have an easier time avoiding paying fees if it can show that its position was supported by a lower court or by one side of a body of conflicting case law. This will not necessarily amount to “substantial justification,” but it helps.

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Documents

msulawstudentbar.files.wordpress.com · Web viewOn the first question, ex parte contacts themselves are generally legal. One exception is that the Constitution (via the Due Process