Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

I.

Control Over Agencies

a. This is a clash between the President and Congress. Each side wants more control over agencies because we live in an administrative state, and agencies exert a vast amount of control over many aspect of life. b. Separation of powers concerns come into play here because the Constitution spells out specific duties and limits for both Congressional and Executive branches. c. Legislative power versus executive power i. SCOTUS is mainly concerned in separation of powers issues with whether the government is following Constitutional procedures 1. If Constitutional procedures not in play, pretty relaxed about it d. Non-delegation doctrine prohibits excessive delegation of discretionary powers Constitutionally-delegated to Congress to federal agencies i. BLL Congress has not violated rule against delegating legislative powers if it sets down in law an "intelligible principle to guide the agency in its exercise of discretion narrow purpose and power to agency 1. Congress must say "here's what we want you to do, fill in the details" ii. An agency may not cure a lack of an intelligible principle by giving itself oneif there is a delegation problem, Congress has to fix it Whitman v. American Trucking e. Legislative veto Congress reserved power to reject agency action without a vote i. Violates Bicameralism and Presentment clauses of Constitution (for legislative, not executive action) and is unconstitutional INS v. Chadha 1. What about AG exercising authority and affecting Chadhas legal rights by deporting him? a. Executing law according to delegated authority so no NDD violation f. Appointment i. Principal officers are appointed by President with advice and consent of Senate Appointments Clause ii. Inferior officers may be appointed with advice and consent, or Congress can legislatively alter the process by placing their appointment with President alone, or Heads of Departments, or Courts of Law iii. Default rule for all officers is by President with advice & consent of Senate unless Congress specifies otherwise in statute iv. Types of jobs: 1. Officers of the United States (subject to Appt. Clause) a. Principal i. High-level officials in Exec. Branch like cabinet members ii. Heads of independent agencies iii. No one in the hierarchy between them and the President b. Inferior

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

v. vi.

vii.

viii. ix.

i. Layer between them and the President ii. Independent counsel - Morrison 2. Employees (can be hired any way) a. Not able to exercise discretion or authority b. Act in aid of legislation i. Collect info, make reports to Congress Freytag special trial judges exercise discretion & authority and are Officers Morrison v. OlsonCourt looks at scope and duration of the officers position and the removal power of whomever to remove the officer to determine if the officer is a principal officer or inferior officer. EdmondCourt moved away from Morrison factors and looked exclusively at whether the officer in question is supervised by someone to determine if hes a principal or inferior officer. If he is supervised by someone, hes an inferior officer. If not, hes a principal officer. Affirmed by PCAOB. How do you reconcile Morrison and Edmond? 1. Sufficient to have a boss, but not necessary. Buckley v. Valeo Congress may not participate in the appointment of administrative officials beyond advise & consent 1. Only Officers of the US may exercise significant authority 2. Congress not named as a possible appointing authority in the clause 3. Further, Court said FEC could not engage in enforcement functions like rulemaking and bringing civil suits because 4 of the 6 members were appointed by Congress (not a valid appointing body)

x. Checklist 1. Does the official exercise authority pursuant to laws of the US? a. If yes, Officer, and Appt. Clause applies 2. Is the official a high-level official with significant policymaking authority and little to no supervision save the President? a. If yes, Principal Officer, and must be appointed by President w/ advice & consent of Senate 3. Does official exercise authority only under substantial supervision by higher-ranking officials within Exec. Branch? a. If yes, Inferior Officer, and Congress may specify appointment or use default rule of Presidential appointment w/ A&C 4. Does individual exclusively carry out activities not involving discretion or policymaking (clerical or maintenance work)? a. If yes, Appt. Clause does not apply (not Officer) 5. Does the official act only in aid of legislative process such as performing research for members of Congress? a. If yes, Appt. Clause does not apply AND Congress can control process of appointment g. Removal i. Absent any Congressional action, President has right of removal at will

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

ii. Congress can impose statutory restrictions on removal like good cause Morrison 1. Unless such removal restrictions impair ability of President to take care that laws are faithfully executed iii. President retains right of removal at will over close Presidential aides and high-level officials, even after Morrison 1. At some point, President has to be able to remove people close to him who dont share his policy views if they are helping make that policy iv. Congress itself may not retain advice and consent power over removal of officials or participate in the removal of officials except through exercise of the impeachment power Myers; Bowsher v. Morrison v. OlsonThe Court held that Congress may restrict the removal of an official exercising purely executive functions. This case greatly expanded Congresss power to restrict the Presidents ability to remove Exec. Branch officials. vi. WeinerOutlier case affecting judges and such 1. The Court authorizes itself to infer a "for-cause" removal provision for quasi-judicial positions 2. Someone exercising a quasi-judicial position should have a for-cause provision on their removal 3. Want people in judicial positions to be able to function neutrally and independently a. Don't want a "Sword of Damocles" hanging over their head that the President may just randomly remove them if he doesn't like their decisions vii. Bowsher v. SynarThe Court held that the Comptroller General couldnt exercise authority under the laws of the US and thus couldnt establish potentially binding spending reductions. 1. Because of Congressional removal restrictions, Comptroller is not an Officer viii. Free Enterprise (PCAOB) PCAOB members subject to removal for cause by SEC commissioners who in turn could only by President for cause. Duallayer for cause removal violates separation of powers. ix. Independent Agencies 1. These agencies have boards rather than sole heads, so they wont change that much with presidential whims. 2. The board members have fixed terms, and the President cant remove them except for cause. a. Should there be this type of limit on presidential power? h. OMB & OIRA i. Presidential effort to control agencies. ii. Agencies must, by Executive Order, submit proposed regulations to centralized review by Office of Management & Budget.

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

iii. Office of Information and Regulatory Review 1. Group of bureaucrats who review other bureaucrats iv. Centralized review of regulation v. Decides what shall not pass and what shall vi. Everything must go through OIRA to be able to be published i.

Article III Courts & Separation of Powers Adjudication Within Agency

i. Agency adjudication raises a separation of powers problem. ii. Because Article III vests the judicial power in the Article III courts, its been argued that administrative agencies usurp that power when they adjudicate cases. iii. When Congress takes actions that affect peoples legal rights, its legislation and Congress must employ Constitutional procedures (Chadha). iv. However, SCOTUS has approved a great deal of agency adjudication. v. When Congress tries to give a federal agency adjudicatory powers over a matter traditionally within jurisdiction of Article III courts, then separation of powers issues arise. vi. Private rights 1. Dispute between two private parties vii. Public rights 1. Dispute between government and private party viii. Crowell v. Benson SCOTUS said public rights may be assigned to nonArticle III courts for adjudication 1. Because public rights could be decided by government without Article III courts, Congress can assign their adjudication to whoever it wants 2. And because at common law claims against government were barred, assigning to admin agencies does not strip Article III courts of any traditional jurisdiction ix. Crowell also allowed adjudication of private rights by admin agencies, but that is more suspect 1. Such as workers comp claims, or mandatory binding arbitration on private rights arising from a federal regulation Union Carbide 2. Although SCOTUS has pretty much gone along with it in cases involving private rights disputes arising out of federal regulations 3. If the dispute is in a closely-regulated field 4. MUST still be judicial review available th x. 7 Amendment Concerns 1. 7th Amendment suits at common law for more than $20 = right to trial by jury a. Only applies to suits at common law at time 7th Amendment was adopted b. Statutory proceedings are not suits at common lawit was unknown at time 7th was adopted NLRB v. Jones & Laughlin Steel Corp. xi. POLICY

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

1. Assigning facts to an agency might actually help preserve judicial power by not overwhelming courts with numerous controversies. xii. Courts now use which weighs the threat to Article III values against the concerns that led to the assignment of adjudicatory authority to the agency. 1. Does the assignment of jurisdiction threaten institutional integrity of federal courts? 2. Courts will be most exacting when Congress assigns adjudication of claim traditionally with Article III courts to an agency. 3. Broader the scope of the agencys jurisdiction, more likely there will be a violation of Article III. j.

POLICY STUFF
i. Congress can't control everything in the modern legislative state 1. Doesnt want to a. Want to be able to pass the blame to agencies ii. Administrators have expertise that politicians don't have iii. One theory says that the President is more limited than people think 1. A lot of his duties require the advice and consent of the Senate 2. Take Care clause is in the passive voice a. Faithfully executed by whom? b. Read in conjunction with the Opinions Clause i. Art II, 2 3. Perhaps it's their duty to carry out the laws iv. Because President is ultimately responsible for the actions of officers, President should have greater power over hirings and firings 1. But competing interests in stability in government v. How powerful should the President be? 1. If the Framer's wanted a unitary executive (formal reading of TakeCare and Vesting clauses) a. Then Bowers, Meyers, Free Enterprise 2. If you want protection for some executive offices because they serve particular goals (more functional approach to Vesting and Take-Care) a. Idea is to have President making some decisions, but also to have diversity below b. Take-Care clause is written in passive voice c. Humphrey's, Morrison vi. One way for Congress to screw with the President is to screw with his appointing / removal power 1. Appointing independent councils, or officers 2. President can't just randomly remove them 3. Only for cause vii. But then President can screw right back 1. OMB 2. OIRA 3. Budgetary control where allowed

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

4. Good or bad? a. None of the agency heads are elected - democratic review i. Good b. Promotes consistency - only OIRA examines everything together i. Good c. Just another opportunity for political meddling - political review of technical Acts - Congress already created review when it delegated authority i. Bad d. More government regulation over regulations - just dumping more regulation and hoops to jump through into the law i. Bad viii. Why not have agencies adjudicate? 1. Want a neutral magistrate 2. Separation of powers keeps the people who charged you from judging you a. Scalia is big on this - formal separation of powers as a further protection of individual rights 3. Judges are better to protect individuals a. Agencies better with esoteric technological stuff? b. Judges use common law, rules of evidence, etc. c. Agencies might make up own rules that are less considerate of individual rights 4. When agencies adjudicate, under a statute, they make the rules about how to bring a claim, discovery, how to settle disputes, etc. 5. Did Congress decide to take power from judges because of politics? a. Judges, because of education, elitism, etc., are not prone to decide in favor of plaintiffs b. Agencies are more efficient so less court clogging 6. Should we take power away like that? Should Congress make these decisions? a. Formalism versus functionalism i. Do we read the Constitution formally and rigidly, or go with the spirit of the Constitution? k. EXAM i. Intelligible principle 1. If you're in favor of the statute, make it look rock-solid and narrow and focused 2. If you want the law overturned, make it look vague and murky 3. Look for objective factors - are the words subjective or do they constrain? Are they precise? a. Look at the adverbs "adequately assures", "material impairment", "regularly exposed"

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

ii. iii.

iv.

v.

vi.

b. "Adequate" could be anything - adequate to whom? Adequate by which standard? Adequate means just barely enough or overdone? If the reasoning is sound, claim that person didn't have the power to make the decision or appointment When you have an appointments issue, work through two steps 1. Is the person in question an officer of the United States? a. The clauses apply if they are 2. Are they an employee? Different route If the person is an officer, or ought to be (they have the powers as such), are they a principal or inferior officer? 1. Was the wrong process used to put them in the office? Court decides who is an officer of the US 1. Officers must be appointed in a certain way 2. Which way depends on principal or inferior officer Look at the statute and determine the person's powers 1. Then look at how they were appointed and attack that 2. Is the person an employee? How much power do they have? A lot? Perhaps they should be classed as officers then. 3. Argue that appointment was done in the wrong way for that particular officer

II.

Judicial Review
a. APA 702 i. Provides for judicial review of final agency action 1. No other adequate remedy a. If Congress has provided another remedy for the agency action, it controls unless it is not adequate ii. Waives sovereign immunity b. Reviewability i. Before a person can challenge something, they must be eligible to do so 1. Court must have jurisdiction a. APA does not grant jurisdiction b. See USC 28 2. Must have standing a. An injury / caused by agencys action / that is redressable 3. Mootness / ripeness ii. Theres a presumption that judicial review of agency action is available. This is so to protect individuals from arbitrary exercises of power. iii. Courts can only review legal issues NOT factual issues. iv. Ways to get judicial review 1. Statute grants it 2. If no statutory grant, there is a presumption of review

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

a. Where a government agency may be violating the law, the court will presume Congress would want the court to review the case and do something about it. v. When judicial review is not available APA 701(a) 1. When statute precludes it a. Such a preclusion does not preclude a Constitutional challenge to substantive statute itself Johnson v. Robinson i. Challenging Congressional decision, not agency b. Otherwise, Congress could essentially amend the Constitution by passing an unconstitutional statute and shielding it from judicial review c. If Congress channels judicial review in particular ways, is there an implicit preclusion of review in other areas? i. Maybe, but probably notgeneral presumption of review ii. And importance of right of review iii. But if an agencys organic statute is very explicit about who can obtain review, then it can implicitly deny review to those not named Block 1. Tough standard (clear & convincing evidence) to meet 2. Must be pretty plain 2. When agency has complete discretion in its action a. When statutes are drawn in such broad terms that there is essentially no law to apply i. Not possible since there is no discernible standard against which to judge the legality of agency action b. Courts are reluctant to allow judicial review of agency decisions involving when to regulate or whom to prosecute for violations within the agencys jurisdiction i. Heckler v. Chaney 1. Rebuttable presumption against reviewability when it comes to prosecutorial discretion 2. However, if statutory standards constrain or channel discretion, then reviewability is available c. POLICY i. What about non-delegation doctrine with no law to apply? 1. Not all agency action involves delegated legislative power 2. Even though there may be no law to apply for reviewability purposes, it doesnt mean there

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

isnt an intelligible principle guiding the agencys exercise of discretion 3. What about decisions on non-enforcement versus decisions not to promulgate rules? a. Parties have a procedural right to file for petition to promulgate rules APA 553 (highly deferential standard) b. Not to participate in individual enforcement decisions c. Agency decision not to promulgate rule is reviewable d. Statutory standards that govern agency action after a judgment is made also govern the agencys decision on whether to make a judgment in the first place Mass. v. EPA vi. Fitness & Ripeness 1. Review only available if the issues are fit for judicial review and the party seeking review would suffer substantial hardship (excessive expense to try and comply immediately) if the review was delayed until after enforcement Abbott Lab. v. Gardner a. If test not met, a party subject to a rule must wait to challenge the rule as a defense to enforcement, typically an agencyinitiated enforcement proceeding - Abbott 2. Is the issue purely legal? Are there any facts or situations that would need to be resolved to decide on legality of a rule? a. If not, probably fit for pre-enforcement review vii. POLICY 1. Reviewability and separation of powers a. A lot of issues in reviewability arise from separation of powers because they concern whether Congress has the power to subject or exempt executive action to review in federal court c. Agency Factfinding i. Sometimes agency facts are up for debate ii. Sometimes the facts they find are critical and decide everything 1. Whether you're a citizen in an immigration hearing iii. Agencies control a lot because they control the facts iv. "Make any rule you want, but let me control the facts" 1. Keeps you under the Man's thumb v. Questions of Fact versus Questions of Law 1. If something is not a question for a court to decide but instead a question for an expert like a doctor, it is a question of fact 2. Agencies typically decide questions of fact a. Everyday experience in the administration of the statute gives the Agency experience in that area b. Not a court's job to second-guess agencies where they make a finding of fact in the area they are tasked to administer 3. Look at the statutedoes the definition hinge on a fact issue or a legal issue?

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

a. If you need to know what causes cancer because you are concerned about how not to get it, it's a fact question b. If you're concerned about what causes cancer because you make toys and need to know in order to comply with statutes, then it's a question of law 4. If you dont need to know any facts, then it is a question of law 5. If you dont need to know any law, then it is a question of fact vi. Mixed Questions of Fact & Law 1. Benzene Case a. What causes cancer = fact question b/c youd ask doctor, not lawyer b. What is a significant risk = law question b/c only answer/definition that matters is in the statute c. Does benzene pose a significant risk of causing cancer = mixed question d. Standard of Review APA 706 i. Unless the agencys organic statute specifies another standard, agency action is determined by applying 706 ii. Arbitrary & Capricious standard 1. For review of questions of law 2. Most deferential standard 3. Applies to all agency action 4. What info did the agency head have when he made his decision? a. The absence of an explanation of a regulation is arbitrary and capricious. b. If you disregard what Congress says is a relevant factor and impose your own, that's arbitrary and capricious Mass. v. EPA iii. Substantial Evidence (APA 556 & 557) 1. For review of questions of fact (agency factfinding) 2. Applies to formal adjudication and formal rulemaking 3. Relevant evidence that a reasonable mind might accept as adequate to support a conclusion a. Even if a court disagrees with an agencys findings, it must affirm them if they are reasonable. iv. De novo (almost never applies) 1. When agency procedures are inadequate or new issues properly arise for the first time on judicial review v. Judicial review of an agency interpretation of a statute is done under the Chevron standard Form of Agency Action APA Standard of Review Formal Adjudication Substantial Evidence

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

Formal Rulemaking Informal (N&C) Rulemaking

Substantial Evidence Arbitrary & Capricious; Abuse of Discretion Not In Accordance With Law Arbitrary & Capricious; Abuse of Discretion Not In Accordance With Law Trial De Novo Trial De Novo (of the new issues)

Informal Agency Action (Overton Park Secretary just made a decision, not under 553 or 556/557) Agency Adjudication With Inadequate Procedures New Issues After Non-Adjudicatory Agency Enforcement

vi. Party challenging statute always wants SE-standard (least deferential) vii. Party defending always wants A&C (most deferential) viii. When a review consists of agency policy decisions made in the course of formal adjudication mix of SE and A&C? ix. Remedy to challenging parties 1. APA 706 says to hold unlawful and set aside any agency action that fails judicial review x. Review On The Record 1. Record that was before the agency is the exclusive basis for judicial review Overton Park a. Agencies are required to make decisions based on a consideration of the relevant factors, including alternatives to the agencys proposal that are suggested by the record, without a clear error in judgment and under the correct legal standard Overton Park b. Reviewing courts shouldnt look beyond record that was before agency at time of decision c. Agencies may not support their decisions with information it didnt have at time of decision or with post-hoc rationalization that were not offered at time of decision-making 2. Agencies must consider every aspect of the record, including the parts that fairly detract from the position takenUniversal Camera 3. An agency that is changing a previously-held policy is allowed to do so, but must supply a reasoned analysis as to why it has done so State Farm a. "An Agency's view of what is in the public interest may change, either with our without a change in circumstances. But an Agency changing its course must supply a reasoned analysis"

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

b. A court should not substitute its judgment for that of the agency, but it must evaluate the agency's reasons for the new rule c. An important question is whether the election of a new president is a reasonable explanation for the rescission of a prior rule 4. Agencies must consider and give adequate response to all comments Nova Scotia 5. Rescission of a rule is subject to same standard of review as initial promulgation State Farm xi. Hard Look Doctrine 1. Another name for A&C review 2. Two schools of thought a. Courts should take a hard look at agency action b. Agencies should take a hard look at the facts 3. Clear Error of Judgmentoften called Hard Look Review a. Overton said court will review if clear error of judgmentvery difficult to prove this if plaintiff. b. Even if agency exercised discretion within statutory bounds and considered all the relevant factors c. Courts have to become familiar with record and see if agency decision is reasonable. d. No consideration of reasonable alternatives? i. When is an alternative reasonable? e. It offers an explanation that runs counter to the evidence before it? f. The rule is so implausible that cannot be ascribed to agency expertise? xii. Hard Look Now 1. Agency action to revoke prior rulemaking can be overturned as arbitrary and capricious 2. A&C standard applies to the policy or discretionary determinations embodied in the adoption, modification, or revocation of legislative rules. xiii. Procedural hard look versus substantive hard look 1. Procedural a. Idea that agencies must consider alternatives b. Respond to counter-arguments c. Listen to affected interests d. Offer detailed explanations of their conclusions e. Process goes to justice regardless of efficiency i. Democratic values at the heart of the hard look doctrine 2. Substantive

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

a. The Court judges the alternative chosen by the agency to be so irrational that is must be ruled out (arbitrary and capricious) b. In order to find against an agency you need clear error of judgment, irrational action, the opposite of feasible and prudent c. Close judicial scrutiny on the merits d. Courts usually do not condemn agency policy as faulty but will remand because procedure was insufficient 3. Courts must ensure that agencies took a hard look and applied their expertise without substituting the courts policy judgments for that of the agency 4. Judge Bazelon (oversee agency procedure) a. In cases of great technological complexity, the best way for courts to guard against unreasonable or erroneous administrative decisions is not for the judges themselves to scrutinize the technical merits of each decision. b. Rather, it is to establish a decision-making process that assures a reasoned decision that can be held up to the scrutiny of the scientific community and the public c. The process of making a de novo evaluation of the scientific evidence invites judges of opposing views to make plausible sounding, but simplistic, judgments of the relative weight to be afforded various pieces of technical data 5. Judge Leventhal (oversee technical decisions of agencies) a. Our present system of reviewing assumes judges will acquire whatever technical knowledge is necessary as background for decision of the legal question b. If technical difficulties of reviewing assumes judges will acquire whatever technical knowledge is necessary as a background for decision of the legal questions c. If technical difficulties loom large, Congress may push to establish specialized courts d. The aim of the judges is not to exercise expertise or decide technical questions, but simply to gain sufficient background orientation xiv. Overton Park 1. Overtons Multi-step process a. Agency acting within authority? Looks at relevant statute to determine the scope and terms of the agencys authority leads to determination of extent of agencys discretion. b. If agency has discretion to choose amongst alternatives, then court looks to see if agency considered relevant factors

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

c. Then decides if the weighing of the relevant factors and choice were arbitrary, capricious, and an abuse of discretion, or otherwise not in accordance with law. 2. Impact of Overton a. Application of presumption of reviewability to informal administrative action effectively converted what had been thought to be exclusively political and administrative matters into legal ones b. Represented a significant innovation that substantially expanded the reach of administrative law over the workings of government 3. Agencies thought that by going informal, they could get away from all the paper trail requirements and such a. Overton Park basically tells them to shove that xv. Skidmore deference 1. Courts decide how much to defer to an agencys interpretive decision based on a. The thoroughness evident in its consideration b. The validity of its reasoning c. Consistency with earlier and later pronouncements d. All those factors which give it power to persuade xvi. Chevron 1. Is the question at issue a question of fact or a question of law? 2. Are we interested in what facts the agency gathered? a. No? Then question of law 3. Mead a. Establishes Chevron Step Zero 4. Chevron Step 0 a. Does Chevron even apply? b. Has the agency been given authority generally to make rules carrying the force of law? i. What in this particular case gives this agency authority? ii. Were they delegated authority under notice and comment rulemaking? iii. Statute says agency has authority? c. And was the interpretation claiming deference promulgated under that authority? i. Did they try and exercise authority delegated to them under notice and comment rulemaking under an opinion letter? ii. Held a hearing or official tribunal with witnesses & evidence iii. Notice & comment rulemaking

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

iv. Some formal mechanism approved by Congress d. If the answer to either question is no, then on to Skidmore deference e. If the answer to both is yes, then on to 5. Chevron Step 1 a. Is Congress's intent clear? b. Have they directly spoken to the precise question at issue? c. Don't forget Footnote 9 i. The judiciary decides if Congress's intent was clear footnote 9 ii. They employ traditional tools of statutory construction iii. Kahn thinks that the footnote makes everything much more muddied for agencies 1. They would prefer no footnote ("If Congress's intent is clear") d. Traditional tools of statutory construction i. Statutory language, legislative intent, history ii. Plain meaning of text - Mass. v. EPA iii. Statutory context Brown & Williamson iv. Avoid absurd / perverse results - Holy Trinity v. Policy judgments are a tool of construction vi. Dictionary definitions - MCI vii. Overall purpose, canons, legislative history viii. Interpretive canons of construction 1. Statutes will be construed so as to avoid Constitutional doubts 2. Ambiguous statutes will be construed so as to apply only in US territory 3. Statutes will be construed favorably towards Native Americans / African Americans / whoever 4. Statutes will not lightly be taken to intrude on power of the President or operation of state governments 5. Judicial review will be presumed 6. Presumption against preemption of state law e. "Battle of the dictionaries" to argue for ambiguity f. If Congress was ambiguous, then agency rejoices, because on to 6. Chevron Step 2 a. Massive agency deference b. But be clear about the intent of Step 2 i. Does the court test the reasonableness of the interpretation against Congress's intent (Step 1 redux)?

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

xvii.

xviii. xix. xx.

ii. Or is it a form of "arbitrary and capricious" review? (most scholars go with this) c. Did they reason through it using their expertise, or just use their own personal opinions? 7. Chevron is hard to apply because sometimes courts just look at the plain text of a statute and sometimes they bring in all kinds of outside stuff like legislative history (Brown) Not entitled to Chevron deference when: 1. Litigating positions for the first time 2. Positions articulated for the first time in briefs 3. Not entitled to deference insofar as the agency is acting as a prosecutor 4. Not if interpreting a statute that is enforced by many agencies 5. Not if interpreting the APA The more formal a setting in which an agency interpretation is made, the more likely it is to merit deference Informally-rendered agency decisions are not entitled to Chevron deference Christenen (opinion letters) If an agency is given Chevron deference under Step 1, the agency may not adopt an inconsistent interpretation Brand X 1. But if under Step 2, can probably change mind and adopt another permissible construction

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

xxi. Policy Questions 1. Is Chevron really that great? a. Based on a fiction that Congress intended to leave interpretation up to agencies b. Chevron is based on a huge legal presumption i. That Congress actually thought about the issue at hand ii. And had a specific intent in mind iii. Or meant to confer discretion on the agency 2. Chevron replaces past cases with a universally applicable bright-line rule a. Replaced case-by-case analysis with a presumption that Congress wanted the agency to decide thing b. More efficient c. Less litigation and waste of court's time 3. What about Mead? a. Came along and screwed up Chevrons easy to understand rule b. A complex and fine-grained inquiry into whether a fictional intent is present or absent?

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

c. Leaves courts with more flexibility, but at the cost of certainty that Chevron provided 4. Chevron deference is just another tool, similar to tools of statutory construction a. Judicial ways of interpreting things b. Gives judges enormous power c. Does this statute require the adoption of canons of interpretation? 5. HYPO a. One way of reading a statute violates the First Amendment, one way doesn't b. Agency interpretation is close to violating reading c. Now Chevron deference is in conflict with a canon of interpretation d. What role do the canons play in interpretation? Does it vary by Justice? 6. How ambiguous can a statute be before it's not clear? a. Does everything have to be crystal clear? What about a little ambiguity? 7. Skidmore is inconsistent and harder to apply a. Skidmore summed up all the prior cases i. NLRB v. Hearst, etc. ii. Very much in line with Marbury but not very clear or useful 8. Chevron gives sense of structure or deliberate method 9. Then came Mead, which fucked up everything again by adding a step 0 10. When should a court defer to an agency on what the law is? a. A complete flip from Marbury v. Madison (which said courts determine what the law is) 11. Consistency with separation of powers yet still have advantages of administrative state 12. Pre-Chevron, cases were more all over than Lindsay Lohan a. Courts are saying what the law is when they defer to agency gap-filling b. Congress delegated to agency to decide what the law is 13. APA 706 says courts will decide all relevant questions of law a. Doesnt deferring to an agency via Chevron mean the agency is deciding what the law is? b. Or has Congress delegated them that power? c. Or are the courts just saying a question of statutory interpretation isnt relevant? e. Substantial Evidence Test (Formal Proceedings) i. APA 706 requires reviewing court to look at the whole record

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

1. Not just parts that support agencys decision ii. When an agency decision is based in whole or in part on credibility of a witness, that decision is entitled to great deference because court only has paper statements and cant evaluate demeanor iii. Agency decision at the highest level that overturns an initial agency decision (like one by an ALJ) is subject to special scrutiny 1. ALJs initial decision is part of the record that appears before the court Universal Camera 2. Because witnesses appear only before ALJ, an agency reversal of an ALJ poses special problems where witness credibility was a factor Universal Camera

III.

Agency Decisionmaking
a. Ideal is for policymaking to be the result of reasoned decisionmaking, applying agency expertise to the factors made relevant by governing law, including statutes and regulation b. Permissible considerations i. Defined by the organic statute ii. Usually allowed to take into account views of President / administration as long as they are consistent with governing statutes iii. Factors not contemplated by the governing statute may not be taken into account even if reasonable Mass. v. EPA c. Clarity & Consistency i. Ties in with Due Process concerns ii. Must be considered with general standards of judicial review 1. Agency action must be taken pursuant to clear criteria a. At odds with agency discretion 2. Soglin university misconduct case a. Misconduct is to broad a standard 3. Hornsby denial of liquor licenses a. Licenses that were approved or denied by board of aldermen and mayor on an almost completely discretionary basis b. Must have ascertainable standards 4. Holmes Housing authority case a. Must operate under ascertainable standards 5. Less clear in immigration cases a. In general, most courts lean towards allowing more discretion Fook Hong Mak 6. Agencies cant rely on secret rulebooks that arent available to the public and decide the outcome of cases Morton v. Ruiz iii. Consistency 1. Agencies risk inconsistency in adjudication where each case is evaluated separately without a legislative rule governing the situation

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

2. An agency that announces a rule must apply the rule as writtenit cannot modify the rule by implication like a common-law court Allentown Mack iv. POLICY 1. Courts impose certain limits on agencys ability to make and to apply policy 2. Those limits offer the agency vast scope to make and apply reasonable policies within the board authority delegated by constitutional, highly general, statutory language 3. In their effort to prevent agencies from using this broad authority unfairly, courts have developed certain common law principles 4. Agencies must a. Articulate their reasons for reaching policy judgments b. They must explain why they are applying those policies to particular individuals c. They must apply those policies similarly to similar individuals d. When changing policies, they must take reasonable account of the individual expectations that their previous policies created 5. If you go too far with deference, the agencies are too authoritarian 6. If the courts demand too much, paralysis by analysis d. The Chenery Rule i. Agency decisions on judicial review will be evaluated on the reasons given by the agency at the time the decision was made ii. An agency may not defend its rule on a new basis that it didnt rely on initially iii. An agencys decisions are supposed to be the product of its expertise 1. And a court cannot affirm based on an argument that doesnt apply that expertise to the particular case 2. Inconsistent with reasoned decisionmaking iv. Different from normal judicial standard where you can get to a good decision by bad reasonsnot so with administrative decisions v. Relates to NDD? 1. Agency must ground the exercise of delegated discretion in reasons sufficient to withstand judicial review vi. Chenery requires remand if it is determined the agency didnt reason properly 1. Even if the agency will just reaffirm its decision with legally-sufficient reasons vii. Agencies must follow their own rules Arizona Grocery 1. Even when those rules go beyond the rights afforded by statute or Due Process Vermont Yankee 2. Any modification must be done in the same way the rule was promulgated a. Promulgated via N&C means a new round of N&C to modify

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

3. Judicial review will be heightened because a court will ask not only if the agency engaged in reasoned decisionmaking but if there is adequate justification for the change viii. Retroactive changes are highly disfavored Bowen 1. Primary retroactivity generally not permitted a. Changes the past effect of past conduct i. At time X theres a rule, then at time X+1 the agency changes the rule and wants it to apply back to past conduct even though at the time you engaged in that conduct it wasnt governed by the rule 2. Secondary retroactivity usually OK a. Changes the future effect of past conduct b. "Going forward, what we allowed then will now be subject to THIS law." i. Past rules dont apply, even if you relied on it, but the legal consequences for that reliance have not changed c. We want agencies to be able to adapt / correct past mistakes d. If we dont permit, society would stagnate ix. Res Judicata and Estoppel 1. Mendoza: a. You cant re-litigate the same issue again i. Similar to collateral estoppel b. Collateral estoppel does not apply to the federal government i. This enables them to create circuit splits. x. Cost / Benefit Analysis 1. Only allowed if governing statutes allow it 2. Courts have not read general standard such as reasonably necessary or appropriate as requiring cost / benefit analysis

IV.

Choice of Decisionmaking Procedure

a. In most cases the choice between rulemaking and adjudication is left to Congress or to the agency. i. Rulemaking 1. Prescribes future patterns of conduct. A determination of general applicability. ii. Adjudication 1. Determines liabilities based upon present or past facts. It applies to specific individuals or situations. b. Under certain narrow circumstances, Due Process requires adjudication. i. When an agency regulates a party based on the particular situation of that party, Due Process requires that the party be given an adjudicatory hearing to present its version of the facts Londoner

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

c.

d.

e.

f.

g.

h. i.

ii. Due process doesnt require hearings when agencies make across-the-board decisions based on general conditions and not the particular situation of any particular regulated party Bi-Metallic iii. When a lone administrator is making legislative decisions that concerns Due Process (deprivation of property / liberty), it requires a hearing Southern Railway Adjudicative Facts i. Facts about the parties and their activities, businesses, and properties ii. Usually answer the question of who did what, where, when, how, why, with what motive or intent Legislative Facts i. Do not usually concern the immediate parties but are general facts which help the tribunal decide questions of law and policy and discretion EXAM i. The more and more people affected, the likelihood that a hearing is Constitutionally required goes down ii. If the source of the issue at hand is statistics, charts, etc., something that's more broad, then again chances of a hearing being required goes down iii. But if based on adjudicative facts, then much more likely to require a hearing When agencies make policy through a legislative rule, then the only issue (when the agency brings an enforcement action) is whether the regulated party violated the rule. When agencies make policy in adjudication, they act much like common law courtsannouncing new rules in the course of deciding the particular case before the agency. Choice between adjudication and rulemaking is (barring something in the organic statute) a matter of discretion up to the agency Wyman-Gordon / Bell Aerospace Formal Rulemaking - APA 556 & 557 i. Formal rulemaking on the record with a hearing and evidence and other trialtype procedures ii. Heavily disfavored (its a pain in the ass) iii. Unless it is absolutely clear and unambiguous that Congress intended an agency to use formal rulemaking, courts will say that agencies can use informal (N&C) procedures per APA 553 Florida East Coast Railway iv. Magic words required from 553(c) 1. Not enough to say hearing 2. Or on the record 3. Must say on the record after agency hearing v. Even in formal trial-type rulemaking, there are savings clauses that allow the agency to not actually do it 1. 556 a. As long as no one is prejudiced, don't have to ask anyone to show up b. And if they do show up, no cross-examination

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

j.

i. Can ask for everything in written form c. Agency can take a risk and not allow full panoply of rights and procedures d. Will work if no one is prejudiced e. However, big risk because someone can challenge and claim they were prejudiced Informal Rulemaking APA 553 i. Notice & Comment 1. Notice of the proposed rulemaking (Federal Register) 2. Opportunity for public comment 3. Agency consideration of comments 4. Publication (Federal Register) of the final rule & a concise general statement of the rules basis and purpose ii. Most common challenges to notice as inadequate 1. Agency issues a final rule that is different from the proposed rule a. Logical outgrowth test i. Final rule must be a logical outgrowth of the proposed rule ii. May not materially alter the issues involved or substantially depart from the proposal 2. Agency relies on data not publicly available as part of the rulemaking process iii. Proposed rule must provide sufficient information to permit informed adversarial critique HBO v. FCC iv. Failure to publish is failure to give notice and the rule is invalid v. To fail to disclose basic data for interested parties to see and comment on is tantamount to ignoring interested partys comments Nova Scotia vi. Cure for inadequate notice is a new N&C period 1. POLICY a. Minor changes, or even substantial ones still within the parameters of the initial proposal, will not result in new N&C period b. Too impractical c. Entire democratic basis for N&C would be seriously undermined if we gave agencies a strong disincentive to ifnore comments vii. Exceptions to 553 1. So long as the organic statue itself is silent, the APA says no notice & comment for: a. Interpretative rules i. Interpret existing legal duties without adding or changing those preexisting duties b. General statements of policy

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

i. Informs public of agencys policy views, but does not add to or alter existing legal rules c. Rules of agency organization / procedure / practice i. But remember Morton v. Ruiz d. Or if the agency finds good cause where it would be against the public interest to go through N&C 2. But must still publish in Federal Register a. If a rule is not properly published, may not be used against a party having no actual notice of it Morton v. Ruiz k. Informal adjudication i. Decisions made without rulemaking or adjudicatory process ii. Do not result in rules / orders iii. Usually policy decisions, such as granting or denying an application or petition informally iv. No APA procedures, just compliance with Due Process v. Authorized by default when the statute doesnt require more formal procedures vi. Overton Park Secretary didnt direct an order at any particular party, nor a rule that could be followed in other caseshe just made a decision vii. Only requires notice of decision and brief statement of reasons behind it APA 555(e) l. Courts may not require procedures of agencies beyond those required by rules and statutes unless there is a due process violation Vermont Yankee i. If an agency itself provides for more rules over and above the organic statute or APA, thats fine and those are to be complied with m. POLICY i. Rulemaking is a legislative process, not a judicial oneshouldnt impose adjudicatory notions of procedural fairness on the rulemaking process ii. Making agencies abide by common-law standards is unpredictable since courts may differ on whats required iii. Thus, agencies would have strong incentive to overproceduralize to avouid being overturned iv. That would, in turn, eliminate the flexibility and informality Congress intended for agencies n. Ex Parte Contacts i. Not prohibited in informal rulemaking ii. Prohibited in adjudicatory proceedings iii. Are agencies acting as little courts or little legislatures? iv. What about Overton Park? 1. Ex parte communications are not part of the record and cant be reviewed 2. No one likes that idea 3. SPLIT on what happens if ex parte communications happen during rulemaking

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

a. Some courts require that documents and the substance of the contact be placed on the record for other interested parties to comment on HBO v. FCC b. Other courts say that only communications of central relevance should be put on the record Action For Childrens Television v. FCC i. HBO and Sangamon apply only to informal rulemaking involving competing claims to a valuable privilege c. But what about Vermont Yankee? i. Ex parte not addressed in APA for informal rulemaking, so can courts impose additional requirements? v. What about ex parte contacts from within government? 1. Contact by members of Congress or by President carry a lot of weight 2. Might they drown out competing voices? 3. But as head of Exec. Branch, doesnt President have a right to control (or at least influence) agency conduct? vi. Rules are different for adjudicatory proceedings 1. Due Process requires formal adjudication proceedings be free of ex parte contacts o. Why Make Rules At All? i. Agency not required to re-litigate the same thing over and over helps agency efficiency Petroleum v. FTC; Texaco ii. Once youve made the rule, the only question becomes was the rule violated 1. If you proceed case by case with adjudication, then the agency is forced to defend it every time iii. Clearer notice for all parties of what is expected than a bunch of adjudicatory decisions iv. Rulemaking process allows interested parties more input via commenting v. Rules can be fairer to everyone since everyone has to obey upon promulgation

V.

Due Process Concerns

a. 2 Step Process i. Triggering event deprivation of property or liberty ii. Then we ask what process is due b. A party has a property interest in a government benefit, license, or job (new property) if the law creates an entitlement by prescribing criteria under which the benefit, licenses, or job will be granted or retained i. Entitlement theory whether law outside the Constitution creates an entitlement interest by specifying conditions under which the interest must be legally recognized Board of Regents v. Roth ii. A unilateral (one-way) expectation of receiving benefits does not confer a property interest or attach Due Process Roth

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

c.

d. e. f.

g.

h. i.

a. Nothing in Roths contract or state law constrained governments decision as to continued employment beyond initial contract term iii. Note the same benefit or interest can vary from state to state, depending on statutes and state practices 1. Such as college teachers in state schools with tenure versus state schools with no tenure a. Tenure creates property interest Property interest in government benefits Goldberg v. Kelly i. Such benefits are a matter of statutory entitlement for those qualified to receive them 1. Also note that they had already qualified to receive them 2. It wasnt an application process ii. Also introduced grievous loss test (rejected by Roth) 1. People on welfare desperately need welfare benefits and would suffer grievous loss if they were cut off In the absences of an explicit entitlement, less formal assurances or state practice may create an entitlement and therefore a property interest Perry v. Sindermann If a statute provides procedural protections only, no entitlement exists. i. Entitlements are created by substantive provisions of law, not procedural Bitter with the sweet Arnett v. Kennedy i. Rehnquist argued that if a statute creates an entitlement but limits procedure to go with it, must take the bitter (procedural limitations) with the sweet (the entitlement) 1. Rejected by majority ii. Once it is determined that there is an entitlement, due process procedures govern, not any limitations imposed by statute If there is an entitlement, initial applicants have a property interest in receiving them i. Applicants must be receive due process before rejection Agencies may not impose legally-binding orders on a party without due process i. Order to pay a fine or some penalty is a deprivation of property Deprivation of liberty i. Does it alter your legal status? 1. Say youre charged but not convicted of shoplifting, and the local police chief circulates your photo to stores and says youre shoplifter a. Doesnt change your legal status, so not a liberty deprivation b. Paul v. Davis

j.

Determining What Process is Due

i. Due Process Basics 1. Notice a. Advance notice of the issues and the time and place of any hearings 2. Oral Hearing

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

a. An oral hearing in advance of adverse government action-the oral hearing includes the right to present oral testimony and argument 3. Counsel a. The right to counsel or some other trained aide 4. Confront the Evidence a. The right to confront the evidence against ones position-this includes the right to cross-examine adverse witnesses and the right to present evidence to undercut the governments case 5. Neutral Decisionmaker a. The right to a neutral decisionmaker who isnt biased and who hasnt prejudged the case in advance of hearing it. ii. To determine when more process is due 1. Matthews v. Eldridge balancing test a. Weigh the injury to the citizen i. How serious is the withdrawal of benefits to the citizen? The stronger the private interest is in being free from deprivation, the more procedure is required under due process. 1. NOTE: Procedural Due Process requires that government employees with an entitlement to continue employment be given a pretermination hearing if the government agency wishes to fire them. b. Look at the risk of error of the government making a mistake i. What was the risk of the government making a mistake under current procedures? ii. The greater the risk of an erroneous deprivation, the stronger the claim is to additional procedures. c. Look at the governments interest and admin burden imposed in having a hearing. i. What is the burden to the government of having to hold a hearing? The governments fiscal and administrative interests almost always favor minimizing the process 1. Thus factoring in costs could seriously undercut value of due process k. General Notes i. Court holds extreme need benefits (welfare) to be more important than benefits like disability 1. Welfare recipients will be on the street without welfare, but disability people were workingshould have some money saved ii. Very strong interest in continued government employment 1. Almost always requires pre-termination hearing

Whoever controls the facts controls the reasons.whoever controls the reasons controls the law.

VI. VII. VIII.

2. Severity of depriving person of the means of livelihood iii. Bias and prejudgment violate Due Process in and of themselves and are not subject to Matthews balancing 1. Bias and prejudgment make any hearing fundamentally unfair no matter what extra procedures are followed Executive Orders What powers do principal versus inferior officers have? Independent agencies