Administrative Law - Pierce

Administrative Law - Pierce / F2011 /

STRUCTURE OF AGENCIES
Agencies: entitiesgoverned by the APA with substantial independent authority
Power: APA in conjunction with the organic statute
Independent Agencies: multi-member; staggered terms; bare majorities require; for cause removal
Removal of "for cause" is really not import: President offers them a choice [quit/fired]
Public forum requirements, multi members more important
Decision-making Structure
The choice determines whether the agency is viable
Split Enforcement Model: Two separate agencies [quasi-criminal justice system]
One makes the rules and investigates; no power to make adjudication decisions
Argue that Due Process requires; but the slowness of decisions kills it
APA Model: same agency makes the rules, investigates, prosecutes, and adjudicates
Bureaucratic choice that allows mistakes for speed and efficiency
Withrow v. Larkin [examining board for medical licenses under APA model] Combination does not without more constitute a statutory or due process violation
Bias And Prejudgment
APA and Due process require a neutral decision maker[fantasy]
Pecuniary Bias: monetary interest [what about small towns; expert boards]
View Point Bias: previously addressed issue as non-decision maker
Rehnquist in Laird - Under no reason should viewpoint bias be a reason
Std: Unalterably Opposed opinion (non-sense)
Ass'n of National Advertisers v. FTC [how much to restrict advertising on children television, FTC commissioner had made his views known] The commissioner was not shown to have an unalterably opposed opinion
Real World Bias Rules - Nearly impossible to have no Bias in a decision
Issues of Law, Policy, Legislative Fact
Impossible to disqualify a decision maker for expressing a view
Do you want a decision maker who has no opinion?
Any other rule - how can a decision maker ever make decisions?
Issues of Adjudicative facts
Facts specific to a case, but are not typically relevant to rule making
No case has ever disqualified a person from a rule making
Real World Adjudications
If a person has expressed an opinion on adjudicative facts – unalterable
Ex parte Contacts
Banned during Formal Adjunctions/Rulemaking
APA silent for Informal Rulemaking
Ex parte contacts are expected and necessary to NOPR
Rulemaking: more like congress (legislative) than the courts
Sierra Club v. Costle [EPA issued rule for emission of SO2 that would heavily effect the economy, jobs, etc. - met extensively with President; agencies; congressmen] Ex parte contacts were necessary to connect the agency process to the electoral process
Big decision effect the entire economy – don’t want experts do this
Disclosure Rule: Failed attempt by DC Circ
HBO v. FCC [cable television regulations between over the air broadcasters and cable broadcasters - many ex parte contacts occurred] Ex parte contacts must be disclosed during rulemaking
Court was making up procedures for agencies [Vermont Yankee]
ACT v. FCC [cabins HBO to rulemakings where two or more individuals are competing for the same right under Sangamon Valley [due process]

AGENCY ACTION
Formal Adjudication - Oral Hearings [§§554-558]
Required for an adjudication if:
Statutory Required due to “magic words” [or]
“On the record after opportunity for an agency hearing” [§554]
CON Required [Due Process _ Mathews Factors]
The word“Hearing” does not require an oral hearing – written hearing is sufficient
Florida East Coast (1973) [ICC required to address chronic freight car shortage] Term “Hearing” is ambiguous and in this context a written is sufficient [rule making]
Dominion Energy v. Brayton(2006) [industrial firm using water for cooling, EPA issues permits to plants to thermal pollute] It is reasonable for the agency to interpret a “hearing” requirement as written exchange of data and views[adjudications]
Informal Rulemaking
Basic Types of Rules
Legislative Rules [N&C rules]
Rules are indistinguishable from statutes – power granted through APA and organic acts
National Petroleum Refiners [FTC changed mind and passed the octane ratings] Ambiguity in statute sufficient to allow agency to pass legislative rule
Adjudicatory Rules
Issue generally applicable rules through case-by-case adjudications [Chenery]
Purpose: Inability of agency to foresee consequences of general rules
Limits: if statute clearly requires agency to issue a rule
Not bound byearlier court if provides a different and legally permissible basis
Chenery [violation of the SEC statute based on case law – court struck; SEC then determine same action on experience/ expertise] Subsequent agency reasoning was a permissible basis for previously struck SEC rule
Features of Rulemaking
Benefits
Higher quality: broader input, focus on policies; and forward-looking
Fairness: broader participation rights, notice, and application to at same time
Efficient and effective: binding effect, reduction in hearings and scope, clarity
Political accountability: advanced notice, broader participation and transparent
Decides Class of Contested Issues: entire group of issues through a rule making
Benefits: Efficiency, accuracy and cost of decision making
But: Matters of degree – rulemaking will not help
Heckler v. Campbell [SSA uses a grid rule to determine disability] For those within the grid (not soft tissue); highly effective rule
Bowen v. Yuckert [SSA instituted prescribed a 5 step process for decision making process requiring a finding of severe impairment]
Rate of finding disability - significant drop
Changed substantive standard or efficiency?
Exceptions must be drawn extremely narrow
If the exception was easy; would swallow the rule and make adjudicatory
Yetman v. Garvey [FAA case with forced retirement at age 60 for commercial airline pilots due to increased risk of sudden incapacitation]
Retroactive Effects [Bowen v. Georgetown]
N&C/§553 Rules: No retroactive effect unless congress has explicitly authorized
Test: Cannot attach new consequences to past conduct
Adjudication Rules: can apply retroactively unless that result is unduly fair
Acting like a court and applying a new rule to past facts
Incentive to not use the rule process to announce general rules of conduct
N&C Rules: General Procedural Requirements
First : MUST have Power to issue rules & No magic words in statute
Adjudicative/Interpretative Rules: Presumption of power
Procedure Requirements of Rules [§553]
NOPR; comments; [AND] concise gen. statement of their basis and purpose
Additional Procedures: must be through rule, statute, CON required
Vermont Yankee [Courts were requiring limited scope oral hearing to expand records for review on important issues] The oral hearing are not required by rule, statute, or CON, and are court imposed procedures
NOPR
Notice must adequately foreshadow final rule, [and]
The final rule must be a logical outgrowth of the Notice and Comment Process
Matter of degree – proposed rule is nearly always different than final rule
Shellv. EPA [rule mentioned regulating chemicals, but not in mixtures] Did not foreshadow the scope of the final rule to residues/mixtures
Disclosure Rule: Notice must refer to studies/ data sources agency will rely
DC Circ: questionable whether its CON under Vermont Yankee
Portland Cement [EPA regulating emissions of cement plants; does not reveal the source of data in the NOPR] Insufficient notice since not available for comment
New studies and data come out often -- when do you stop publishing?
American Radio Relay League v. FCC[rejecting an agency rule on notice for relying on study it did not identify in the NOPR] [questions under VY]
NOPRs are REALLY hard to issue: 5-10 years between notice and final rule being issued; agency heads last 22 months; 3-4 years to draft
Comments
Critical Comments: must be addressed by the agency with huge basis and purpose
Requires: factual predicates, alternatives, consulting firms [huge cost]
Nova Scotia Foods [fish case where the temperature; A&C for comments]
Six Exemptions from N&C
Subject matter [Military and Foreign Affairs; Gov Property and Benefits]; Good Cause [very hard to meet - emergency for bodies piling up]; Rules of Procedure [Erie problems ]
Interpretative Rules and Policy Statements [litigated all the time]
Challenge: Procedural invalid legislative rule issued without N&C
Cannot Challenge: notice; basis; and no record for A&C
Interpretative Rules: clarify existing law
Legislative Rule if: Agency says its is legislative; rule is published [most are]
Enforcement action could not be brought w/o the rule
Is the new rule required to bring the action? [Y – Leg]
Rule amends a pre-existing legislative rule
Amends Interpretative Rule: DC Cir calls it legislative
Paralyzed Veterans - crap – prof trying to change
American Mining Congress[Act authorizes MSHA to require mine operators to report; issue interpretative rule to define diagnosed]
Policy Statements: Ambiguous, non-binding statements that are hard to use
Ambiguous Language: cannot give clear language
PG&E [regulating price of gas results in shortages – ambiguous lang]
Not Legally Binding: regulates or agency
Must remain free to act; cannot limits its discretion w/ policy
Young [unlawful to serve any adulterated food “we will not take action below this level” – found to be binding]
Practically Binding: following policy in a group of cases
Appalachian Power [adhere to policy - its binding; but don’t - its A&C]
Judicial ReviewAgency Action
Presumption of Reviewability: includes informal actions that have not record
Overton Park [state wanted to put highway through a park] Requiring formal findings due to ambiguity of the agency action – testimony (rejected in LTV)
PBGC v. LTV [LTV defaulted and PBGC took over pensions] While testimony is not required, the agency is require to give sufficient info for arbitrary and capricious review
Prof: Makes no sense: Not a rule making; Not deprivation of liberty
Formal Adjudications – Substantial Evidence
Scope of Review: review Agency finding; NOT ALJ findings
Deferential STD: Reasonable mind might accept considering all the evidence
Uphold any finding of fact by an agency if substantial evidence [§706(2)(e)]
Types of Evidence: can be met purely with written reports
Subpoena writers: very limited by the ALJ standard [cost prohibitive]
Richardson v. Perales [SSA - denial of benefits based on written notes (hearsay)vs oral testimony] Admissibility of evidence does not factor into SE std
SE/AC: There is no difference in substance between the standards [ADP – same facts]
Informal Adjudications - Arbitrary and Capricious [APA 706(2)(A)]
Pre-Abbott Std : no set of facts and no plausible reason for the rule [Box and Basket]
Still exist - Can be applied when a court reviews a rule with no record
Abbott Standard: Must engage in reasoned decision making
N&C Required: rescission; amendment; AND issuance of rules
Issuing: give factual predicate and reasoning
Changing: statement of why new policy is better and why
Not required to prove the policy is actually better [Fox]
Critical Comments: require long and detailed basis and purpose
APA [rule required head rest to be installed in all cars after a certain date, challenger wanted it retroactive] The weak arguments were not supported by the record and a plausible reason given by the agency
National Tire Dealers [branding tires, retreads found that the work was dangerous and would increase the price, and gave alternative] A&C since agency did not adequately respond to the studies challenging the rule
State Farm [passive restraints in automobiles - wanted REVOKE rule since everyone was using the auto seatbelt method instead of airbags - did not give a new separate factual basis]Did not sufficiently address viability of airbag alternative nor explain difference in factual predicate
Fox v. FCC [fleeting explicative used on TV - historically the FCC did not go after] Provided sufficient reasons why new policy was better
CT: agencies are not required to apply the CON canon
Rulemaking Ossification
Legislative Rules: agencies are pressed due to time and cost [not doing them anymore]
Chenery[ADJ gen rules]; State Farm [long basis; 30% overturn];Shell [foreshadow notice - 10% failure]; Portland Cement [disclosure]; Georgetown[no retroactive affect]
Adjudication Rules individual fact patterns; lower impute; limited notice; questionable fairness
Congress's Response: Regulatory Negotiation [Reg-neg] - get together and fight first [nope]
Courts Response: Remand without Vacation [Remand without Vacatur]
With Vacation: no rule and not retroactive
W/O Vacation –rule remains and remanded on x A&C issue

AGENCY INTERPRETATION
Basic Statutory Theories
Deferential view: is it warrant in the record and reasonable basis in law
Skidmore v. Swift [time spent on standby in fire hall working time, the courts decide and the agency role to enforce] All types of decision are given deference
Thoroughness of consideration and Validity of its reasoning;Consistency with earlier and later pronouncements; [and] persuasiveness
De Novo Review: Agency interpretation are issues of law resolved through case-law
Hearst [newsboys try to form a union after supplier increase price of the papers – agency found the boys were not employees] Historical basis for the decision
Dose Response: only know the high dosages; background and time frustrate lower range
Benzene[Benzene has serious effects far above 10ppm; but we have no idea what the at lower concentration - new standard as lowest detectable level] New standards can replace old standards if old standard creates a “significant risk”
Chevron Reasonableness
Chevron Two Step Test
Has congress directly spoken to the precise question at issue? [Y – legal question]
Is the statute ambiguous? [Y - court must uphold any reasonable agency interpretation]
Ambiguity: policy decision delegated to executive [political accountability]
Not Ambiguous: this is what the statute says; agency must follow
Reasonable: reasoned decision making process [State Farm]
Chevron v. NRDC [meaning of term “Source” in the Clean air act - agency made decision to view source as bubble instead of individual pieces] Congress did not define source, its ambiguous, and the agency’s meaning is reasonable
Never Ambiguous: Traditional Tools of Statutory Construction [FN 9]: Dictionary; Legislative Hist; Statutory Purpose; Canons of Con
Reality: Chevrondid not change anything [continue to split 4-1-4]
Rule Making Idea: start a NOPR to decide terms and court should uphold (never done)
Rapanos[CWA confers jurisdiction over "waters of the US"; agency has made interpretations of this meaning through case-by-case adjudications]
Dissent: Congress did not define the term; it’s an ambiguous; and reasonable
Scalia: interpretive tools show Congress overreached; agency outside the statute
Kennedy (solo): need for a nexus (on his own boat)
Scope: If Chevron does not apply Skidmore deference applies [Mead]
Christensen [county policy where employers can force a employee to take their time - Agency "opinion letter" that county does not defer – Skidmoreapplies]
Mead [customs service classifications decision through informal adjudication, service applies tariff laws through the state done informally – skidmore applies]
Brand X [agency interp #1 is court reviewed and upheld as reasonable, agency interp #2 is inconsistent with interpr #1 -- LCT held stare decisis] Prior term was ambiguous and reasonable interpretation under Chevron

Type** / Chevron / Skidmore
Formal Adjudications/Legislative Rules / X [Christensen]
Interpretative Rules/Policy States / X[Mead]
General Deference to Agencies / Chevron >Skidmore
Deference to Agency’s Interpretations / Ambiguous and reasonable - must / Persuasive – not mandatory
Amount of Reasoning / Reasoned Decision Making [State Farm] / “Quality” of reasoning
Consistency / Not a factor unless unreasonable / Lack of reduces quality/deference
Stare Decisis / Not Ambiguous: Stare Decisis applies
Ambiguous: No stare decisis / Stare Decisis applies

**Court is never clear which deference was applied

Agency Rules
Deference give to agency interpretation of its own legislative rule [Auer/Seminole Rock]
STD: uphold unless Plainly Erroneous or inconsistent with the regulation
Plainly Erroneous - is that just unreasonable or "step 1 of Chevron"?
Penalty Cases: fair warning required to apply an interpof an ambiguous rule
Fairness concerns: can only be penalized with reasonable notice/DP
Anti-Parroting : will not get deference if you parrot [copied statute]
Matter of Degree – have not gone far enough in changing words
Purpose: avoid judicial review and N&C process
Gonzales v. Oregon [state allowed doctors to assist with suicide - agency interps parroted rule to cover the dispensing of drugs] Auer deference is not due
Scalia who wants to overrule: no deference to interpretation of own rules [broad and ambiguous]
Deference Rates: Statutory Doctrines
Doctrine: Does not seem to matter - overall rate is 67-70% upheld of agency decisions
Auer: Outliner at SCOTUS (91%); but 76% at District Court
Procedures: only seems to matter if 1st time advancing position
Relative Expertise:More deferential with agency they think knows a lot more than they do
Ideological beliefs: 30% of difference in voting is attributed to view points
Options: use a mixed panel on the circuit [whistleblower; but is it CON]
DC Circuit is less deferential: repeat players; expertise; SCOTUS aspirations
Arguments in Interpreting [for the exam]
Considers relationship between statute and agency action [strong – no Chevron/Skid]
Cannot act outside the boundaries of the statute
Considers relationship between available evidence and agency action; and
Evidence is always in conflict
Considers quality of agency’s reasoning [State Farm / Skid]
Result: Court loads their arguments
Even applying the less/more deferential std of Skid/Chev, would still uphold/over
Manipulate Stare Decisis: Argue Cases upheld under Skidmore or Chevron

REVIEW OF AGENCY DECISIONS
Agency Action - Presumption Of Reviewability
Court Assumption that congress intended courts to review agency actions
CON review: available unless expressly precluded [avoidance canon]
Robison [conscientious object performs alternative service; applies for veterans benefits] The statute does not expressly forbid judicial review of CON questions
Webster[CIA director terminates a homosexual] While the decision is clearly committed to the CIA, the statute did not preclude review for CON question
Statute Precludes Review [§701(a)(1)]
Express Language: Statute clearly and unequivocally precludes review
Structure and objectives of the statutory scheme
Confers explicit rights to A; limits same to B – implicitly limits B’s review
Block[milk marketing act - minimum price that milk - limits rights of handlers review of prices] Structure of act clearly limits reviewavailale to handlers
Legislative history and Nature of the administrative action involved
Statute must explicitly preclude review of N&C rules
Bowen [agency determine which services are paid; issues a rule stating they will not cover a certain group] Barring individual review does not expressly preclude review of the agencies legislative rule
Committed to Agency Discretion [§701(a)(2)]
Court must have “law to apply” or some legal standard
Presumption has moved from never, to most of the time
Overton Park [highway through a state park; statute is silent as to reviewability] Agency had to meet standard of “feasible and prudent” alternatives
Lincoln v.