Administrative Law

Document Sample
Administrative Law Powered By Docstoc
					                                                ADMINISTRATIVE LAW OUTLINE
                                                  Prepared by: Benton Tyler Drinkwine
                                                   Spring 2005 – University of Denver
                                       Following Administrative Law – 5th Edition Schwartz / Corrada

I.          INTRODUCTION TO ADMINISTRATIVE LAW AND ADMINISTRATIVE AGENCIES ....... 4
     A.        Gilmore v. Lujan (1991) p.1 ........................................................................................................... 4
     B.        What is an Administrative Agency? ............................................................................................... 4
     C.        Administrative Law Judges............................................................................................................. 4
II.            INDEPENDENCE OF AGENCIES ................................................................................... 4
     A.        Introduction ..................................................................................................................................... 4
     B.        Analysis........................................................................................................................................... 4
     C.        Removal Powers ............................................................................................................................. 5
III.           DELEGATION OF POWERS TO ADMINISTRATIVE AGENCIES .................................... 7
     A.  Delegation of Legislative Power ..................................................................................................... 7
           Introduction ................................................................................................................................. 7
          1.
           Analysis....................................................................................................................................... 7
          2.
           Congress must set a standard for action ...................................................................................... 7
          3.
     B. Delegation of Adjudicative Power .................................................................................................. 9
       1. Overview: .................................................................................................................................... 9
       2. Political Concerns of delegating adjudicative powers to agencies: ............................................ 9
       3. Public v. Private Rights Analysis – Federal Courts .................................................................. 10
       4. State Court Analysis (California).............................................................................................. 10
       5. Remedies, Penalties and Fines .................................................................................................. 10
IV.            INVESTIGATIONS AND INFORMATION ..................................................................... 12
     A.  Records and Reports ..................................................................................................................... 12
       1. 5th Amendment privilege (self-incrimination) does not extend to records required to be kept by
       law. …………………………………………………………………………………………………12
       2. 4th Amendment does not protect against the disclosure of such documents because: .............. 13
     B. Protection of Confidential Information ......................................................................................... 13
       1. Non-Discloseable Information at the Department of Commerce: ............................................ 13
       2. Violations .................................................................................................................................. 13
       3. Sanctions ................................................................................................................................... 13
     C. Inspections .................................................................................................................................... 13
       1. Introduction ............................................................................................................................... 13
       2. Analysis..................................................................................................................................... 13
       3. General Rule: Warrants Needed ............................................................................................... 14
       4. Exceptions to Warrant Requirements ....................................................................................... 14
     D. Subpoenas ..................................................................................................................................... 16
       1. Introduction ............................................................................................................................... 16
       2. Summary ................................................................................................................................... 16
       3. Enforcement of Subpoenas ....................................................................................................... 16
       4. Subpoena Jurisdiction ............................................................................................................... 16
       5. Scope of Subpoena Power ........................................................................................................ 17
       6. Non-compliance with a subpoena ............................................................................................. 17
     E. Freedom of Information ................................................................................................................ 17
       1. Overview ................................................................................................................................... 17
                                                                                                                                                    -Drinkwine
       2.      Scope of Disclosure .................................................................................................................. 18
       3.      Exemptions from Disclosure..................................................................................................... 18
       4.      Maintaining Confidentiality in Agency Records. ..................................................................... 18
       5.      Procedure for Disclosure........................................................................................................... 18
       6.      Remedies for Failure to Disclose Requested Documents ......................................................... 18
V.          RULES AND RULEMAKING ....................................................................................... 19
  A.  Terminology.................................................................................................................................. 19
  B.  Substantive Rules .......................................................................................................................... 20
    1. Agencies can only do what is authorized by statute ................................................................. 20
    2. General determinations can be made by statute and by Rules. ................................................. 20
    3. Agencies cannot make ultra vires rules .................................................................................... 20
  C. Legislative v. Non-Legislative Rules ............................................................................................ 21
    1. General ...................................................................................................................................... 21
    2. Legislative v. Non-Legislative Rules ........................................................................................ 21
  D. Legal Effect of Substantive Rules................................................................................................. 21
    1. Agencies are bound to follow its rules and cannot deviate from explicit rules. ....................... 21
    2. Retroactive Rulemaking is valid if Congress authorizes it, or even if no authorization, the
    particular area in question has not previously been regulated. ......................................................... 22
  E. The Use of Cost-Benefit Analysis in Rulemaking ........................................................................ 22
  F. Notice of a Rule – Publication ...................................................................................................... 22
    1. Introduction ............................................................................................................................... 22
    2. Analysis..................................................................................................................................... 23
    3. Even when an agency gives out wrong information, the published rule is binding. ................ 23
  G. Reliance on Agency Advise (Estoppel) ........................................................................................ 23
  H. Rulemaking Procedure .................................................................................................................. 23
    1. Where can you find rulemaking procedures? ........................................................................... 23
    2. Three ways to make a rule. ....................................................................................................... 23
  I. Informal Rulemaking .................................................................................................................... 24
  J. Hybrid Rulemaking ....................................................................................................................... 24
  K. Formal Rulemaking ...................................................................................................................... 25
  L. Bias in Rulemaking ....................................................................................................................... 25
  M.     Ex Parte Communications in Rulemaking (one sided communications).................................. 25
  N. Rules v. Orders.............................................................................................................................. 25
VI.         THE RIGHT TO BE HEARD ....................................................................................... 27
  A.        Introduction ................................................................................................................................... 27
  B.        Legislative v. Judicial Functions................................................................................................... 28
  C.        Privileges....................................................................................................................................... 29
  D.        Entitlements .................................................................................................................................. 29
  E.        Exception to the Hearing Requirement – Waiver ......................................................................... 31
  F.        Exception to the Hearing Requirement – Emergency Cases ........................................................ 32
  G.        Exception to the Hearing Requirement – Additional Exceptions ................................................. 32
VII. EVIDENTIARY HEARINGS AND DECISIONS .............................................................. 32
  A.        Parties in Interest and Intervention ............................................................................................... 32
  B.        Who can be heard.......................................................................................................................... 33
  C.        Notice and Pleadings..................................................................................................................... 33
  D.        Counsel ......................................................................................................................................... 34
  E.        From Examiners to Administrative Law Judges. .......................................................................... 34
  F.        Bias ............................................................................................................................................... 35
  G.        Combination of Functions – (during adjudication… not rulemaking) ......................................... 36
                                                                                2
                                                                                                                                               -Drinkwine
  H.    Evidence ........................................................................................................................................ 36
  I.    Burden of Proof............................................................................................................................. 37
  J.    Illegal Evidence ............................................................................................................................ 38
  K.    Exclusiveness of Record ............................................................................................................... 38
  L.    Official Notice .............................................................................................................................. 38
  M.       Decision Process ....................................................................................................................... 39
  N.    Making the Decision ..................................................................................................................... 40
  O.    Findings of Fact and Conclusions of Law .................................................................................... 40
VIII. JUDICIAL REVIEW ................................................................................................... 41
  A.    Introduction ................................................................................................................................... 41
  B.    Jurisdiction – Statutory Silence, Preclusion, Discretion ............................................................... 41
  C.    Statutory Preclusion and Agency Discretion ................................................................................ 42
  D.    Statutory Preclusion ...................................................................................................................... 42
  E.    Agency Discretion ........................................................................................................................ 43
  F.    Standing ........................................................................................................................................ 44
  G.    Finality .......................................................................................................................................... 46
  H.    Primary Jurisdiction ...................................................................................................................... 46
  I.    Exhaustion of Administrative Remedies ...................................................................................... 48
  J.    Ripeness ........................................................................................................................................ 49
  K.    Substantial Evidence ..................................................................................................................... 50
  L.    Chevron Doctrine .......................................................................................................................... 52




                                                                            3
                                                                                                    -Drinkwine



I. Introduction to Administrative Law and Administrative Agencies
     A. Gilmore v. Lujan (1991) p.1
             i. Whether an application for an oil/gas lease was timely filed when faxed to the agency on the
                date of the deadline when agency regulations required a holographic signature and the
                original arrived the day after expiration of the deadline
            ii. No. The 9th Cir, upheld the BLM’s rejection as it did not contain a handwritten signature
                    1. BLM’s regulation require a handwritten signature
                    2. Publication of the rule gave Gilmore notice
                    3. The fax violated the rule as it was machine generated, not handwritten.
     B. What is an Administrative Agency?
           iii. APA§531 (p.839) “Each authority of the Government…” with exceptions such as Congress,
                President etc.
           iv. Exercises administrative functions, but is not part of executive or judicial.
            v. Subject to narrow standard of review
           vi. Label given to the agency by Congressional statute.
     C. Administrative Law Judges
           vii.   They hear adjudication
          viii.   Cannot play dual roles, so cannot be prosecutor or defender & judge at the same time.
            ix.   Appointed under APA §1305
             x.   Role defined in APA §556(c)
            xi.   Separation of functions found in APA §554(d)
           xii.   Independence from agency guaranteed in APA §7521

II. INDEPENDENCE OF AGENCIES
     A. Introduction
          xiii. Agency Power
                   1. Congress can only delegate the power that it is given in the constitution.
                   2. If Congress delegates more power than it has to an agency, the agency will be
                       unconstitutional.
          xiv. The Separation of Powers Doctrine:
                   1. One cannot trust the government, so you must separate power.
                   2. The Legislature cannot exercise either judicial or executive power; the Executive
                       cannot exercise judicial or legislative power; the Judicial cannot exercise executive or
                       legislative power.
           xv. The Appointments Clause – Art. II §2.
                   1. The President “shall nominate, and by and with the advice and consent of the Senate,
                       shall appoint… Officers of the United States: …but the Congress may by Law vest
                       the Appointment of such inferior Officers as they think proper, in the President alone,
                       in the Court of Law, or in the Heads of Departments.” see Morrison.
                   2. After appointment the Congress can only remove executive officers upon
                       impeachment by the House and conviction by the Senate. –see Bowsher.
     B. Analysis
          xvi. Appointment Powers– See Appointment Clause
                  1. Issue 1: Principal or Inferior officer
                  2. Issue 2: Was the required process followed?
                         a. Principal Officers require appointment by President, with advice and consent
                              of the Senate.
                         b. Inferior Officers: Created by statute which states if president alone appoints,
                              courts of law appoint, or department heads
                  3. Issue 3: Any Separation of Powers issues?

                                                     4
                                                                                            -Drinkwine
                    a. You can’t trust the government so powers must be separate.
                    b. SOP Doctrine. Judicial cannot legislate or execute etc…
    xvii. Removal Powers
             1. The President’s removal power is almost unfettered under the Constitution when it
                comes to “purely executive officers” – Myers.
             2. Congress can limit the President’s power to remove members of an independent
                agency. – Humphrey’s.
             3. Formalist Separation of Powers Analysis
                    a. Congress cannot hold removal power over executive officers – Boweher.
             4. Functionalist Separation of Powers Analysis
                    a. Do the restrictions on the President’s removal power interfere with the
                        President’s exercise of his constitutionally appointed functions? –Morrison.
C. Removal Powers
   xviii. Regarding Executive Officers, the President’s removal power is almost unfettered.
             1. Myers v. United States (1925) p. 25
                      a. Whether Congress can retain removal power over the postmaster general (an
                          executive agent).
                               i. No.
                      b. Congress can’t draw upon itself the power to remove officers exercising
                          executive powers or participate in the exercise of executive power.
                               i. Congress cannot meddle in the executive powers of the Government.
             2. President’s removal power is almost unfettered under the Constitution when is comes
                  to “purely executive officer”
                      a. Criticized as too broad, but remains good law today.
             3. Congress can still Impeach / Convict Executive Officers
    xix. Congress can limit the President’s power to remove members of an independent agency.
             1. Humphrey’s Executor
                      a. Whether Congress can limit the power of the President to remove members
                          of the independent agency
                               i. Yes.
                      b. The FTC is not solely an executive agency under the president. It is quasi-
                          legislative and quasi-judicial.
                      c. Unlimited presidential removal power would threaten the “independence” of
                          the independent agency.
     xx. Formalistic Separation of Powers Analysis - Congress cannot delegate power and then
          appoint executive officers.
             1. Bowsher v. Synar (1986) p. 23
                      a. Whether the assignment of Congress to the Comptroller General of certain
                          functions violated the doctrine of separation of Powers where Congress had
                          retained removal power over a congressional agent exercising executive
                          powers.
                               i. Yes. The power vested in the Comptroller General violates the
                                   constitutional command that the Congress play no direct executive
                                   roles.
                      b. The Comptroller General was a congressional officer exercising executive
                          powers.
                      c. Congress cannot execute the laws and it can therefore not grant this power to
                          one of its officers.
                      d. While Congress may determine the content of legislation and thereby the
                          nature of the executive duties to be exercised there under, Congress can
                          thereafter not control the execution of its enactment other than by mew
                          legislation.


                                             5
                                                                               -Drinkwine
      e. By placing the execution of the law in the hands of an officer removable by
          Congress, Congress in effect has retained control over the execution of the
          laws.
               i. Note: - Supreme Court has said that the analysis of Bowsher does not
                  play significance on the constitutionality of independent agencies.
2. Morrison v. Olsen (1988) p.28
      a. Summary of Case
               i. Appointment of inferior officers can be made by Article III Courts
                  when there is a statute to allow for it.
              ii. Must determine if he appointment impedes the president’s ability to
                  perform his job.
      b. Whether the independent counsel statute was unconstitutional because it
          violated the Appointments Clause or the Separation of Powers doctrine?
               i. No.
      c. Issue 1: Is the Independent Counsel a Principal or Inferior officer?
               i. The Independent Counsel is an Inferior officer because:
                       1. Subject to removal by higher executive branch officer,
                       2. Performed limited duties,
                       3. Limited jurisdiction,
                       4. Limited tenure.
      d. Issue 2: Is the Independent Counsel a violation of the Appointments
          Procedure?
               i. The Appointments Clause does not deny inter-branch appointments.
                       1. The inclusion of “as they seem proper” suggests significant
                           discretion.
              ii. Subject to Separation of Powers limitations
                       1. Congress did not reserve any meaningful powers of
                           appointment for itself.
                       2. Appointment by a court would be inappropriate if there was
                           an incongruity between the court functions and the
                           performance of the duty to appoint.
                       3. Appointments by the judge was not inappropriate because
                           the special division could do so only when the Attorney
                           General recommended, and the AG’s refusal to recommend
                           appointment was not subject to judicial review.
      e. Issue 3: Did the removal provision (good cause) interfere with the President’s
          exercise of his constitutionally appointed functions?
               i. The removal power remained in the hands of the executive branch
              ii. “The real question is whether the removal restrictions are of such a
                  nature that they impede the President’s ability to perform his
                  constitutional duty, and the functions of the officials in question must
                  be analyzed in that light.”
                       1. The president’s control over the counsel’s discretion was not
                           so central as to require removal at will.
      f. Issue 4: Did the Act reduce the President’s ability to control the prosecutorial
          powers wielded by the independent counsel?
               i. The Act was not an attempt by the legislature or the judiciary to
                  increase their power at the expense of the executive.
              ii. The power to appoint inferior officers is not an executive function in
                  the constitutional sense.
             iii. The AG retains the power to remove the Independent Counsel for
                  “good cause” which gives the President sufficient power to ensure
                  the laws are faithfully executed.

                                6
                                                                                                     -Drinkwine

III.   DELEGATION OF POWERS TO ADMINISTRATIVE AGENCIES
       A. Delegation of Legislative Power
             1. Introduction
                    3. Article 1 § 1: Legislative power shall be vested in Congress.
                             a. A delegated authority cannot be delegated.
                             b. John Locke The Delegation Doctrine– “We the People” have delegated the
                                 power of legislation to the Congress as the sole repository of this power –
                                 thus cannot be delegated
                                      i. Non-delegation doctrine today holds a minority on the Supreme
                                          Court that Congress has to make fundamental policy choices rather
                                          than passing them on.
                    4. Article I §8: Necessary and Proper Clause
                    5. Given the reality of big government, delegated authority must be delegated to
                        agencies.
                    6. Congress may delegate power as long as it circumscribes the authority that is
                        delegated.
             2. Analysis
                    7. Issue 1: Is there a standard in the statute? ie. did Congress delineate the general
                        policy, the public agency which to apply it, and the boundaries of this delegation?
                    8. Issue 2: If so, is it an intelligible principle?
                    9. Issue 3: If not, does anything else in the statute or outside of it serve as an allowable
                        attribute?
                    10. Issue 4: Did Congress delegate to a proper authority?
                    11. Issue 5: Did Congress have authority to regulate in this area?
             3. Congress must set a standard for action
                    12. Panama Refining Co. v. Ryan (1935) p. 67
                             a. The National Industrial Recovery Act §9(c) delegated to the president
                                 regulation of interstate commerce of “hot oil”.
                             b. Delegation was invalid because Congress had not stated whether or in what
                                 circumstances of under what condition the President was to exercise the
                                 delegated authority.
                             c. **Better to cite to Schechter (below) as to too broad of legislation**
                                      i. Note: View in light of political circumstances of the time of the Great
                                          Depression.
                    13. A.L.A. Schechter Poultry Corp. v. United States (1935) p. 67
                             a. The National Industrial Recovery Act §3 delegated to the President the
                                 power to approve “codes of fait competition” for the government of trade and
                                 industries.
                             b. Delegation invalid because the standard was too broad.
                             c. **Best law as to too broad legislation**
                                      i. Note: View in light of political circumstances of the time of the Great
                                          Depression.
                    14. Yakus v United States (1944) p. 69
                             a. The Emergency Price Control Act of 1942 gave the “Price Administrator”
                                 the power to set “fair and equitable” maximum prices for purposes of
                                 stabilizing prices and prevent speculation. Consideration of benchmark
                                 prices.
                             b. Valid delegation because the standard limited administrative power.
                                      i. Key Fact: war powers, reference to standard prices: Supreme Court
                                          has given more lenience to the Executive in times of war.
                                     ii. Note: Court has upheld those statutes that are broad.
                    15. Lichter v. United States (1948) p. 71


                                                     7
                                                                                -Drinkwine
       a. Whether the Renegotiation Act of 1942 unlawfully attempted to delegate
            legislative power.
                  i. No.
       b. The Act gave administrators the power to renegotiate war contracts and
            recover “excessive” profits (no definition of excessive was given).
       c. Delegation upheld because the term “excessive” was sufficient. No formula
            is needed when flexibility was essential. Congress later amended the statute
            to include administratively developed factors.
                  i. Key Facts: war powers, congressional amendment based on
                     administrative practices.
       d. The Court can infer what Congress intended v. what it explicitly stated in the
            statute.
                  i. Most alarming is that the court did not have the subsequent statute
                     before it made its decision.
       e. How to use:
                  i. You may find the standard elsewhere besides the statute; if you can,
                     you might be okay.
                 ii. Doubt is cast by Whitman (below).
16. Fahey v. Mallone (1947) p. 72
       a. Power to issue regulation prescribing terms/conditions under which to
            appoint conservator for mismanaged federal savings and loans. No standard
            given in the statute.
       b. Upheld delegation because there were industry principles functioning as
            substitutes for statutory standards.
                  i. Key Facts: Industry standards functioning as substitute for statutory
                     standards.
       c. How to use:
                  i. You may find the standard elsewhere besides the statute; if you can,
                     you might be okay.
                 ii. Doubt is cast by Whitman (below).
17. Mistretta v. United States (1989) p. 73
       a. Was the delegation of power to the Sentencing Commission to set sentencing
            guidelines constitutional?
                  i. Yes, the statute contained the necessary intelligible principle.
       b. Delegation is consistent with the Separation of Powers doctrine so long as
            Congress “shall lay down by legislative act an intelligible principle [to
            exercise the authority]…”
                  i. Congress needs the flexibility
       c. It is enough if Congress delineates the general policy, the public agency
            which is to apply to it, and the boundaries of this delegation.
                  i. Congress set forth 3 goals and 4 purposes.
                 ii. Congress prescribed the specific tools (ranges) for the Commission
                     to use.
                iii. Commission to use current sentences as a starting point.
                iv. Commission was to consider factors formulating offence/defendant
                     categories.
       d. An agency may exercise discretion in determining facts and the inferences to
            be drawn from them in light of statutory standards and policy declarations.
                  i. Provided there are statutory standards to guide the agency’s
                     discretion to allow a court to determine whether congressional intent
                     has been obeyed.
       e. Scalia’s dissent:
                  i. Delegation of purely legislative power is always unconstitutional,
                     regardless of standards.
                                8
                                                                                               -Drinkwine
                               ii. Delegation of general legislative power must be ancillary to the
                                   lawful exercise of executive or judicial process.
                              iii. Delegation only constitutional if exercise of a power requires some
                                   discretion.
                              iv. “Creation of a new branch: Junior-Varsity Congress”.
                     f. How to use:
                                i. Good example of how to use these theories in real-life: Mistretta was
                                   trying to get the charges that were brought against him to go away…
                                   by arguing that the agency was unconstitutional.
              18. Industrial Department v. American Petroleum Institute (1980) p. 84
                     a. Justice Rehnquist’s concurring opinion
                                i. Delegation of legislative authority based on common sense and
                                   inherent necessity of governmental coordination.
                               ii. (1) Whether there is a standard in the statute, legislative history or
                                   statutory context.
                              iii. (2) If not, whether standardless delegation was justifiable in light of
                                   inherent necessity of the situation where it would be unreasonable or
                                   impracticable for Congress to prescribe detailed rules.
                                        1. Here the delegation was valid.
                     b. Benzene had NO safe level, and Congress delegated to the agency what the
                          safe standard is.
                                i. It should be Congress that sets the standard as Congress should
                                   balance the economic and social benefit of benzene with the public
                                   health and set the level.
                     c. Congress is supposed to set the policy as they are accountable to the people.
                          By passing it to an agency, Congress violates the trust that ‘We the People’
                          placed in Congress.
              19. Whitman v. American Trucking Association p. (supplement)
                     a. Whether the Clean Air Act’s delegation of authority to EPA to set NAAQS at
                          levels (allowing adequate margin of safety) “ requisite to protect public
                          health” was constitutional.
                                i. Yes.
                     b. An agency cannot cure an unlawful delegation of power by adopting in its
                          discretion a limiting construction of the statute. It is not possible to cure a
                          standardless delegation by declining to exercise some of that power because
                          making that choice would be in itself prohibited.
                     c. The scope of discretion in §109 is well within the outer limits of the Court’s
                          non-delegation case law even though fairly broad and ambiguous.
B. Delegation of Adjudicative Power
      1. Overview:
             20. Agencies may adjudicate public rights
                      a. Belong to or exist against the federal government
                      b. Congress, acting for a valid leg purpose, may create seemingly private rights
                          closely integrated into a public regulatory scheme as to make a dispute
                          resolution appropriate by agencies as opposed to courts
             21. Private Rights must be adjudicated by Art.-III Courts.
      2. Political Concerns of delegating adjudicative powers to agencies:
             22. If Congress delegates adjudicative power outside the realm of Article III Courts, will
                 it be outside the realm where your rights are guaranteed?
                      a. Primarily right to a jury trial, due process.
                      b. Can be seen as an encroachment on to the independence of the judicial
                          branch.


                                              9
                                                                                          -Drinkwine
3. Public v. Private Rights Analysis – Federal Courts
       23. Congress can assign the adjudication of public rights (those arising under a federal
           statute –) to non Article-III courts – even when there would be a right to a jury trial if
           adjudicated in court.
               a. Murray’s Lessee
                          i. FACTS: A statute authorized federal marshals to seize and sell
                             property that belonged to a customs agent who failed to turn over to
                             the govt. money collect on its behalf.
                         ii. Supreme Court rejected a claim that Art.-III precluded a
                             determination by the Treasury Dept whether the agent owed money.
                             This involved “public rights” – rights arising under a federal statute,
                             instead of private rights – rights arising under common law equity.
                        iii. Art.-III does not apply to public rights because of the doctrine of
                             sovereign immunity.
                        iv. For public rights, Congress may eliminate judicial review altogether.
       24. Private claims must be adjudicated in Article-III courts.
               a. Generally, adjudication of claims regarding private rights cannot be assigned
                    to a non Article-III court. 7th Amendment prohibits such delegations
                          i. Granfinanciera, S.A. v. Nordberg (1989) p. 112
                                 1. Right to jury trial in fraudulent conveyance case means that
                                      the case cannot be assigned to a bankruptcy court.
                                          a. Note: This case doesn’t really tell us anything new.
                         ii. You have a right to a jury trial when there is the possibility of you
                             going to jail.
               b. Exceptions to private rights being adjudicated in Article-III Courts
                          i. New Statutory Rights
                                 1. Crowell v. Benson (1932) p. 110
                                          a. FACTS: Involved worker’s compensation claims
                                          b. HOLDING: Congress can create new statutory rights
                                              between individuals and assign the adjudication of
                                              these rights to agencies (with sufficient judicial
                                              review).
                         ii. Ancillary Claims
                                 1. Thomas v. Union Carbide Agricultural Products, Inc.
                                      (1985) p. 107.
                                          a. No longer looks at the parties but looks at the right
                                              itself. If it was created under a statute, then it is a
                                              public right even though it may look like a private
                                              right.
                                          b. The vast grey area between public and private rights
                                              gives congress great leeway.
4. State Court Analysis (California)
       25. Note: For Exam, only worry about the Federal Rule: Disregard the State Rule.
       26. Private/Public Rights distinction is complicated. Instead, CA allows an
           administrative agency to exercise judicial power if:
               a. Substantive Limitation – (i) such activities are authorized by statute or
                    legislation and are reasonably necessary to effectuate the administrative
                    agency’s primary, legitimate regulatory purposes, and
               b. Procedural Limitation – (ii) the essential judicial power (ie. the power to
                    make enforceable, binding judgments) remains ultimately in the courts
                    through review of agency determinations.
               c. See McHugh v. Santa Monica Rental Control Board.
5. Remedies, Penalties and Fines
       27. Introduction
                                        10
                                                                                 -Drinkwine
       a. Criminal Sanctions – Agencies may enact regulations providing for criminal
            sanctions, but an agency may not prosecute or imprison for violation of those
            regulations
       b. Civil Penalties – Agencies can impose civil penalties (as long as they are
            authorized by statute) without protections afforded under the criminal law,
            but several decisions deny agencies to impose punitive damages.
                 i. Note: If authorization is not explicit in the statute, some justices may
                     look to legislative intent and maybe historical evidence.
28. Vainio v. Brookshire (1983) p. 130
       a. Whether an agency may award damages for violations in its regulatory area.
                 i. Yes. The Montana Supreme Court upheld the agency’s award of
                     $20,000 in damages for emotional distress and harassment case.
       b. Does the Montana Human Rights Act violate the Montana Constitution
            because the Act’s procedural provisions do not allow for a jury trial?
                 i. No. The legislative bodies may assign agencies in which a jury trial
                     would be incompatible without violating the 7th Amendment.
       c. Does the Act constitute an unlawful delegation of judicial and legislative
            power to administrative agencies because it authorizes the HRC to award
            damages?
                 i. No. The act grants the HRC discretion to award “reasonable”
                     damages and its final orders are subject to judicial review.
                ii. The Act authorizes the HRC to requires “reasonable” measures to
                     correct discriminatory practices and to rectify harm. This included
                     damages for emotional distress.
       d. The legislature may delegate the power to award damages.
       e. The legislature may delegate the power to adjudicate without a jury trial as
            long as the claim is a non-common-law claim.
       f. The legislature may delegate the power to adjudicate without a jury trial as
            long as the claim involves a new action/proceeding created by statute.
29. An agency does not have the power to impose penalties unless authorized.
       a. In re Investigation of Lauricella (1989) p.135
                 i. Whether the State Civil Service Commission was allowed under the
                     states constitution to impose a fine on a person who was not a civil
                     service employee and who was found to be in contempt of an order
                     issued by the Commission.
                          1. No. The Commission was not authorized to impose
                              punishment for contempt of one of its orders because the LA
                              Constitution did not give it that power.
                ii. The court examined the LA Constitution to see whether it vested
                     jurisdiction in the Commission to impose fines.
                          1. The LA Constitution vested executive, legislative and
                              judicial powers in the Commission:
                                  a. Punish violators of its rules by demotion,
                                       suspension, or discharge.
                                  b. Hear and decide all removal and disciplinary cases.
               iii. The LA Constitution also contained a general provision providing for
                     penalties for violations of the Civil Service Laws (including orders
                     by the Commission, limited to $500.)
30. Remember to look to other Constitutional matters that may limit penalties.
       a. 8th Amendment may be violated when confiscating $357,000 of one’s money
            because he didn’t declare taking over $200,000 out of the country.




                                11
                                                                                                  -Drinkwine

IV.   INVESTIGATIONS AND INFORMATION
      A. Records and Reports
            1. 5th Amendment privilege (self-incrimination) does not extend to records required to be
            kept by law.
                   31. Agencies can circumvent 5th Amendment privileges when:
                          a. The reporting requirement is intended to promote a legitimate regulatory
                               area.
                          b. It is not directed at activities that are inherently “criminal” and,
                          c. There is no reasonable expectation of privacy against judicially compelled
                               disclosure of records required to be kept by law.
                   32. Shapiro v. United States (1941) p. 154
                          a. FACTS: Fruit and produce wholesaler was prosecuted for violations of
                               regulations issued by the Office of Price Administration (war-time agency).
                               OPA subpoenaed sales records, and Shapiro claimed his 5th Amendment right
                               was violated
                          b. HOLDING: SC rejected the argument because:
                                     i. 1. The records were ordinary business records
                                    ii. 2. The business was not inherently “suspect”
                                   iii. 3. The agency was acting within its authority.
                   33. Craib v. Bulmash (1989) p. 148
                          a. FACTS: Employer was accused of a minimum wage violation and the
                               Division of Labor Standards Enforcement Division issued a subpoena duces
                               tecum for records of a kind which all employers are required by law to
                               maintain. Employer cited 4th and 5th Amendment violations.
                          b. HOLDING: No violations
                                     i. 4th Amendment claim – unreasonable search and seizure supported
                                        by probable cause
                                             1. Subpoenaed records need only be relevant to authorized
                                                 regulatory purpose.
                                             2. There is no reasonable expectation of privacy against
                                                 judicially compelled disclosure of records required to be
                                                 kept by law.
                                          th
                                    ii. 5 Amendment claim – self incrimination
                                             1. Records required to be kept by law have “public aspects”
                                                     a. The reporting requirement is intended to promote a
                                                          legitimate regulatory area.
                                                     b. It is not directed at activities or persons that are
                                                          inherently “criminal”, and,
                                                     c. It only requires minimal disclosure of info of a kind
                                                          kept in the ordinary court of business.
                   34. Marchetti v. United States (1968) p. 156
                          a. FACTS: At issue is a statute requiring that gamblers who operated in
                               violation of state laws to register and file reports on their illegal gambling
                               activities.
                          b. HOLDING: The statute unconstitutionally required a gambler to incriminate
                               himself.
                                     i. Marchetti was obligated to keep records that were not customarily
                                        kept by those in business,
                                    ii. Marchetti’s documents had no “public aspects” as they contained
                                        Marchetti’s private information, and
                                   iii. Shapiro involved a non-criminal and regulatory activity, whereas the
                                        requirement in Marchetti was imposed on a select group inherently
                                        suspect of criminal activity.

                                                   12
                                                                                                -Drinkwine
           th
      2. 4 Amendment does not protect against the disclosure of such documents because:
           35. The subpoenaed records need only be relevant to an authorized regulatory purpose.
           36. There is no reasonable expectation of privacy against judicially compelled disclosure
               of records required to be kept by law.
B. Protection of Confidential Information
      1. Non-Discloseable Information at the Department of Commerce:
            37. Business Proprietary Information
                     a. Protected under Administrative Protective Order
            38. Privileged information
            39. Classified Information
      2. Violations
            40. Disclosure of BPI to unauthorized persons.
            41. Failure to follow the terms of the APO
            42. Loss of BPI
            43. Fialure to return or destroy the APO
      3. Sanctions
            44. Sanctions can be imposed on the person violating the APO or on a law firm-wide
                 basis.
                     a. Barring the person from future representation before the agency (long – or
                         short-term).
                     b. Denying that person access to BPI in the future
                     c. Other administrative sanctions, such as striking from the record of
                         information submitted.
                     d. Private letter of reprimand
                     e. Public reprimand.
C. Inspections
      1. Introduction
             45. The 4th Amendment
                      a. The right of the people to be secure in their persons, houses, papers, and
                           effects, against [1] unreasonable searches and seizures, shall not be violated,
                           and no [2] Warrants shall issue, but upon [3] probable cause, [4] supported
                           by Oath of affirmation, and [5] Particularly describing the place to be
                           searched, and the persons or things to be seized.
      2. Analysis
             46. Is this a 4th Amendment Issue?
             47. Is there a warrant?
                      a. If yes, then legal.
                      b. In regulatory issues, warrants may be issued on less than probable cause
             48. If no warrant?
                      a. Do any of the exceptions apply?
                                 i. Search authorized
                                        1. Consent
                                        2. Emergency
                                        3. Plan View / Open Fields
                                ii. Warrant-less search authorized by Congress
                                        1. Closely regulated business. (see Marshall v. Barlow’s)
                                                 a. Has the business been historically regulated? (see
                                                     Donovan v. Dewey)
                                                 b. Is the regulation substantial (more than a mere
                                                     licensing scheme),
                                                 c. Does the statute in question is limited to a single
                                                     industry (see Marshall v. Barlow’s).
                               iii. Burger Test: Is the warrant-less search okay?

                                              13
                                                                                      -Drinkwine
                                1. Is there a substantial government interest that informs the
                                    regulatory scheme pursuant to which the inspection is made.
                                2. Is the warrant-less inspection is “necessary to further [the]
                                    regulatory scheme,”
                                3. Is the statute’s inspection program, in terms of certainty and
                                    regularity of its application, provides a constitutionally
                                    adequate substitute for a warrant.
3. General Rule: Warrants Needed
      49. Camera v. Municipal Court (1967) p. 165
              a. The 4th Amendment prohibits an administrative inspection of a private
                  dwelling without a search warrant.
              b. A warrant for an administrative inspection may be issued at a lesser standard
                  than probable cause (required for criminal warrants).
      50. SEC v. Seattle p. 165, 167
              a. The 4th Amendment prohibits an administrative inspection of business
                  premises without a search warrant.
4. Exceptions to Warrant Requirements
      51. Introduction
              a. The exceptions to Warrant Requirements include:
                        i. Consent
                       ii. Emergency
                      iii. Plain view / Open fields
                      iv. Pervasively / Closely Regulated Industries.
      52. Colonade Catering Corporation v. United States (1972) p. 166
              a. The Supreme Court held that Congress can validly provide for warrantless
                  searches of closely regulated industries, such as the liquor business, without
                  violating the 4th Amendment.
                        i. In this case however, Congress had not authorized warrant-less
                           searches.
      53. United States v. Biswell (1972) p. 166
              a. The Supreme Court upheld a warrantless search of a firearms dealer as part
                  of an inspection authorized by statute as not violating the 4th Amendment.
              b. Close scrutiny and frequent inspections were essential to enforcing the
                  firearms laws. The laws would be frustrated by a warrant requirement.
              c. When a dealer chooses to engage in a pervasively regulated business, he does
                  so with knowledge that he is subject to effective inspection.
      54. Marshall v. Barlow’s Inc. (1978) p. 166.
              a. Whether a warrantless search of a business was constitutional based on the
                  businesses’ interstate activities.
                        i. No. The Supreme Court held that the 4th Amendment requires a
                           warrant for this type of search as mere participation in interstate
                           commerce did not make the business fall within the “closely
                           regulated” industry exception, and, therefore, the statute was
                           unconstitutional.
              b. A regulatory scheme that cuts across industry and imposes requirements in a
                  given field for all businesses does not fall within the warrantless exception.
                  For the exception to apply, the business must be under the jurisdiction of an
                  agency vested with pervasive regulatory authority, including licensing
                  power, over the specific industry.
              c. TEST: Is this a closely regulated Industry? Examine whether:
                        i. The business in question has been historically regulated by some
                           level of government, (see Donovan v. Dewey below)
                       ii. The regulation is substantial (more than a mere licensing scheme),

                                       14
                                                                                -Drinkwine
              iii. The statute in question is limited to a single industry (see Marshall v.
                   Barlow’s above).
55. Donovan v. Dewey (1981) p. 166
       a. The Supreme Court upheld a warrantless inspection of a coal mine under
          statute similar to the OSHA statute in Marshall v. Barlow.
       b. The court determined that the coal mining business was pervasively
          regulated by analyzing the purpose of the Act (improve health and safety) in
          an industry with “a notorious history of serious accidents and unhealthy
          working conditions.”
56. New York v. Burger (1987) p. 158
       a. Whether a warrantless search of an automobile junkyard, conducted pursuant
          to a statute, fell within the exception to the warrant requirement for
          administrative inspections of pervasively regulated industries.
       b. Whether an otherwise proper administrative inspection was unconstitutional
          because the ultimate purpose of the regulatory statute pursuant to which the
          search was done (deterrence of criminal behavior) was the same as that of
          penal laws, with the result that the inspection may disclose violations not
          only of the regulatory statute but also of the penal statute.
                i. Yes and No. The court upheld the regulatory scheme, as it was a
                   reasonable warrantless inspection of a closely regulated industry.
       c. 4th Amendment prohibition of unreasonable searches and seizures apply to
          both private homes and commercial premises.
       d. The expectation of privacy is lower in commercial settings than with regard
          to private homes. Especially in “closely regulated industries”. Certain
          industries have such a history of government oversight that no reasonable
          expectation of privacy exists.
                i. The doctrine is defined by “the pervasiveness and regularity of the
                   federal regulation” and the effect of such regulation upon an owner’s
                   expectation of privacy. The duration of a particular regulatory
                   scheme is not dispositive, but remains an “important factor” in
                   deciding whether a warrantless inspection pursuant to the scheme is
                   permissible.
       e. In situations of “special need,” where the privacy interest of the owner is
          weakened and the government interests in regulating a particular business are
          concomitantly heightened, a warrantless inspection of commercial premises
          may well be reasonable within the meaning of the 4th Amendment. But, only
          so long as:
                i. TEST – Is the warrant-less search okay?:
                        1. Is there a substantial government interest that informs the
                             regulatory scheme pursuant to which the inspection is made.
                        2. Is the warrant-less inspection is “necessary to further [the]
                             regulatory scheme,”
                        3. Is the statute’s inspection program, in terms of certainty and
                             regularity of its application, provides a constitutionally
                             adequate substitute for a warrant.
       f. Searches made pursuant to the statute at issue fell within the exception as
          junkyards were closely regulated businesses in New York. The focus should
          be on whether the regulation was sufficiently comprehensive to come within
          the exception. In this case:
                i. New York had a substantial interest in regulating vehicle-
                   dismantling and junkyards because car theft had increased in the
                   state and was associated with the industry.
               ii. Regulation of the industry reasonably served the State’s substantial
                   interest in eradicating car theft. Warrantless administrative
                               15
                                                                                             -Drinkwine
                                 inspections were necessary to further the scheme. A warrant
                                 requirement would interfere with the State’s purpose as stolen
                                 cars/parts pass quickly through junkyards. Surprise was crucial.
                            iii. The Statute provided a constitutionally adequate substitute for a
                                 warrant as it informed an operator that it would be subject to regular
                                 inspections. The statute set froth the scope of inspection and placed
                                 operators on notice how to comply. The discretion of the inspecting
                                 officers was also limited.
                            iv. Nor was the statute unconstitutional because an inspection may
                                 reveal evidence of crimes, besides violations of the scheme itself.
                                 The discovery of evidence of crimes in the course of otherwise
                                 proper administrative inspection did not render the search illegal or
                                 the administrative scheme suspect.
                     g. Note: On remand, the NY Supreme Court called the search illegal according
                        to NY State Constitution.
                              i. US Constitution gives the minimum rights required
                             ii. State Constitution can provide more protections than the Federal
                                 Constitution.
D. Subpoenas
     1. Introduction
            57. 5 U.S.C. §555(d) – Subpoenas:
                    a. Must be authorized by statute
                    b. Shall be issued to a party on request
                    c. Need a showing of general relevance and reasonable scope of the evidence
                        sought; and
                    d. Enforced by a court.
     2. Summary
            58. Agency subpoenas must be authorized by statute.
            59. Can be issued after showing of a general relevance and reasonable scope of the
                evidence sought.
            60. Must be enforced by a court.
            61. An agency can subpoena information to find out whether it has jurisdiction.
            62. Agencies can use subpoena to go on a fishing expedition to determine if violations
                have occurred.
     3. Enforcement of Subpoenas
            63. Texas Lawyers Insurance Exchange v. Resolution Trust Corporation (1993) p. 170
                    a. Agency subpoenas are not self-executing, they must be enforced by a court.
                    b. No penalty for contempt may be imposed before an opportunity for judicial
                        review has been offered.
                              i. Penalty power must be conferred by statute.
                             ii. No criminal penalties (imprisonment).
     4. Subpoena Jurisdiction
            64. Agency’s subpoena jurisdiction is broader than its regulatory jurisdiction (see Notes
                3-4 p. 179)
            65. EEOC v. Kloster Cruise Ltd. (1991) p. 176
                    a. Whether an agency must show conclusive evidence of jurisdiction before a
                        court can enforce a subpoena.
                              i. No. The district court’s role in an enforcement action is merely to
                                 determine whether the south evidence is relevant to a lawful purpose
                                 of the agency.
                    b. The agency need not made a conclusive showing of jurisdiction. So long as
                        the agency can make a plausible argument in support of its assertion of
                        jurisdiction, a district court must enforce the subpoena if the information

                                            16
                                                                                            -Drinkwine
                        sought is not plainly incompetent or irrelevant to any lawful purpose of the
                        agency.
                    c. EXCEPTION: When the lack of jurisdiction is so clear that the enforcement
                        the subpoena would result in an abuse of the court’s process.
                              i. Can’t claim ultra vires – You must allow the agency to determine if it
                                 indeed has jurisdiction.
      5. Scope of Subpoena Power
            66. FTC v. American Tobacco Co. (1924) p. 181
                    a. Whether an agency petition for enforcement of a subpoena must be supported
                        by evidence of the materiality of the sought documents.
                              i. Yes. Agencies cannot engage in “fishing expeditions”.**
                                      1. **Note, US v. Morton Salt (below) suggests that agencies
                                           now can engage in fishing expeditions.
                    b. An agency’s right to access is the right to access documents as evidence, not
                        the right to access all documents. The agency must support a petition for
                        enforcement by evidence that the sought documents contain evidence of a
                        possible violation by the company being investigated.
            67. Endicott Johnson Corporation v. Perkins (1943) p.178 & Oklahoma Press
                Publishing Co. v. Walling (1946) p. 179
                    a. Agencies may subpoena information as long as the evidence sought is not
                        plainly incompetent or irrelevant to any lawful purpose of the agency in the
                        discharge of its duties.
                    b. An agency does not need to have probable cause to believe that a particular
                        company has committed a violation before subpoenaing documents.
                        Subpoenas maybe used to develop facts, even when the agency is not yet
                        certain it has a case. It is enough that an agency show that:
                              i. Congress authorized it to conduct an investigation,
                             ii. It is for a purpose Congress can order, and
                            iii. The documents sought are relevant to the inquiry.
            68. United States v. Morton Salt (1950) p. 182
                    a. Administrative agencies do not derive their power from the judiciary, which
                        is constricted by only being allowed to request relevant evidence in a case
                        and controversy.
                    b. Administrative agencies may collect evidence merely on suspicion that the
                        law is being violated, or even just because the want assurance that it is not.
                    c. Hence, administrative agencies can now engage in “fishing expeditions”
      6. Non-compliance with a subpoena
            69. A party cannot invoke a lack of jurisdiction or claim that the subpoena targets
                someone outside the agency’s regulatory scheme.
            70. Non-Compliance with the subpoena subjects you to penalties.
            71. Plausible support for non-compliance.
                    a. The subpoena is ultra vires; outside the statutory authority of the agency
                    b. The subpoena is not for a lawful purpose that Congress can authorize.
                    c. The information sought is not reasonably relevant to lawful inquiry.
                    d. The subpoena violates a personal constitutional right, such as the 5th
                        Amendment.
                    e. The subpoena is not issued in proper form.
E. Freedom of Information
      1. Overview
            72. Freedom of Information Act Features (p. 185)
                    a. Applies to “any person,” not just to parties
                    b. Does not apply to Government Agencies
                    c. Requestor need not provide reasons for its request

                                             17
                                                                                         -Drinkwine
                 d.  Disclosure is the general rule, not the exception.
                 e.  The exceptions from disclosure are voluntary, not mandatory.
                 f.  All individuals have equal rights to access.
                 g.  The burden of proof is on the government to justify withholding.
                 h.  An individual improperly denied access has a right to seek injunctive relief in
                     courts where the court will hear the matter de novo (with no deference).
2.   Scope of Disclosure
        73. 5 U.S.C. §552(a)(2)
                 a. Final opinions and orders made during adjudication
                 b. Policy statements and interpretive statements not published in the Federal
                     Register
                 c. Administrative staff manuals and instructions that affect members of the
                     public.
                 d. Copies of records under paragraph (3).
                 e. A general index of records released nder paragraph (3).
3.   Exemptions from Disclosure
        74. §552(a)(2) – Published Materials
        75. §552(b)(1) – Maters to be kept secret in the interest of national defense or foreign
            policy.
        76. §552(b)(2) – Internal personnel rules and practices of an agency.
        77. §552(b)(3) – Matters exempted from disclosure by statute.
        78. §552(b)(4) – Trade secrets
        79. §552(b)(5) – Inter-agency or intra-agency memoranda.
        80. §552(b)(6) – Personnel and medical files and similar files that the disclosure of which
            would constitute a clearly unwarranted invasion of personal privacy.
        81. §552(b)(7) – Records or information compiled for law enforcement purposes.
        82. §552(b)(8) – Matters related to financial institutions.
        83. §552(b)(9) – Geological and geophysical information and data, including maps.
        84. §214(a)(1) – Homeland Security Act of 2002 – Critical infrastructure information.
4.   Maintaining Confidentiality in Agency Records.
        85. §552(a)(2) – Redaction
        86. §552(b) – The agency is under an obligation to produce “[a]ny reasonably segregable
            portion of a document after redaction of exempt information.
5.   Procedure for Disclosure
        87. §552(a)(3)(A) – A request must (1) reasonably describe the records and (2) be made
            in accordance with the published rules.
        88. §552(a)(3)(B) – An agency shall provide the requested materials in the form or
            format requested.
        89. §552(a)(4)(A)(i) – A requestor is not entitled to receive documents free of charge.
        90. §552(a)(4)(A)(iii) – Documents shall be furnished free of charge under certain
            circumstances.
        91. §552(a)(4)(A)(v) – An agency may not request payment in advance.
        92. §551(a)(6)(A) – An agency has 20 days to determine whether to comply with a FOIA
            request.
6.   Remedies for Failure to Disclose Requested Documents
        93. §552(a)(4)(B) – Appeal to the federal courts which have jurisdiction to enjoin the
            agency from withholding the records and to order the production of records. The
            burden is on the agency to sustain its action.
        94. §552(a)(4)(E) – Complaintant may recover reasonable attorney fees and other
            litigation costs.
        95. §552(a)(4)(F) – If agency personnel acted arbitrarily or capriciously, disciplinary
            action may follow.
        96. §552(a)(4)(G) – Contempt the responsible employee of the agency.

                                        18
                                                                                                      -Drinkwine
                    97. §552(a)(6)(C)(i) – A person making a request is deemed to have exhausted his
                        administrative remedies if the agency fails to comply.
    b. New York Times v. NASA (1990) p. 195
            i. Whether voice recordings constitute “similar files” under Exemption 6 of the FOIA.
                    1. §552(b)(6) – Personnel and medical files and similar files that the disclosure of which
                        would constitute a clearly unwarranted invasion of personal privacy.
                    2. Yes. Voice recordings apply to a particular individual and are exempt from the
                        disclosure if disclosure would constitute a “clearly unwarranted invasion of personal
                        property”
           ii. First examine whether the tape is a “similar file”, then whether the release of the file would
               result in a clearly unwarranted invasion of privacy.
         iii. The tapes were “similar files” as the sound and inflection of the crew’s voices were personal
               to them.
          iv. The FOIA makes no distinction between information in lexical/non-lexical form; all
               information is covered.
           v. When examining Exemption 6, the threshold for the application of Exemption 6 is that the
               information “applies to a particular individual”.
    c. Chrysler Corporation v. Brown (1979) p. 204
            i. Involved a reverse FOIA suit in which a party submitted information and later brought a suit
               to enjoin the release of that information.
           ii. The court rejected the injunction. The FOIA is a disclosure statute and does not afford a
               private right of action to enjoin agency disclosure.
                    1. However, the Trade Secrets Act prohibits disclosure under certain circumstances.
    d. O’Kane v. US Customs Agency (1999) p. 205
            i. Is a private individual’s privacy interest in his/her home address greater than the public’s
               interest in disclosure for commercial reasons?
                    1. Yes.
           ii. Courts use a balancing test to determine whether an individual’s privacy interest qualifies
               under the FOIA exemption.
         iii. Individuals have an important privacy interest in their home address.
          iv. The public interest in promising legal representation does not outweigh individuals’ privacy
               interest in their home addresses.
           v. The Electronic Freedom of Information Act Amendments of 1996 (“any purpose”) merely
               clarified that electronic records are subject to FOIA; they did not narrow FOIA’s privacy
               exclusion or invalidate the private/public interest balancing test.

V. RULES AND RULEMAKING
    A. Terminology
            vi. Importance
                    1. If a rule is binding on you, the rule must be created in a certain way. If is is made
                        incorrectly, then the rule will be invalid and ultra-vires.
                    2. If an agency rule applies to you, it is just as binding as a statute created by Congress.
           vii. Rules are made to the entire group affected and incorporate future acts, orders relate to
                individual parties and are made on past actions.
          viii. Agencies promulgate rules according to:
                    1. The Federal APA, and
                    2. It’s enabling statute
                    3. Sometimes another statute
            ix. Rules are published in the Federal Register and subsequently in the Code of Federal
                Regulations (if Applicable).
             x. Agencies have 4 ways to make “rules”:
                    1. Formal adjudication
                    2. Informal adjudication

                                                    19
                                                                                              -Drinkwine
             3. Formal rulemaking
             4. Informal rulemaking
      xi. Rulemaking / Adjudication Dichotomy
             1. APA §551(5) “rule making:” – “Agency process for formulating, amending, or
                 repealing a rule.”
             2. APA §551(4) “rule” – “Agency statement of general or particular applicability and
                 future effect designed to implement, interpret, or prescribe law or policy or
                 describing the organization, procedure, or practice requirements of an agency…”
             3. APA §551(6) “order” – “final disposition… of an agency in a matter other than rule
                 making but including licensing.”
             4. APA §551(6) “adjudication” – “agency process for the formulation of an order.
                     a. Justice Holmes’ analysis focuses on time: a rule prescribes future patterns of
                          conduct; a decision determines liabilities upon the basis of present and past
                          facts.
                     b. Professor Dickenson analysis focuses on the fact that legislation affects the
                          rights of individuals in the abstract and must be applied in future proceedings
                          before the legal position of any particular individual will be definitely
                          touched by it; adjudication operates concretely upon individuals in their
                          individual capacity.
     xii. Cordero v. Corbisiero (1992) p. 221
             1. Whether the agency’s policy was in fact a rule.
                     a. Yes. The policy is a rule because it fixes general principles applied without
                          regard to the facts and circumstances of the individual case.
                               i. Compare definition of a rule APA §551(4)
             2. Terminology is not dispositive in the actual case.
             3. Comment: The distinction matters because it affects how the “rule” must be enacted
                 and what legal effect it has.
B. Substantive Rules
      1. Agencies can only do what is authorized by statute
            4. In re Permanent Surface Mining Regulation Litigation (1981) p. 224
                    a. Whether the Sec. of the Interior has rulemaking authority to require that
                        mining permit applicants submit information beyond that enumerated in the
                        Act because the enumerated list is not exhaustive.
                             i. Yes.
                    b. The act contained both general and specific authorization of rulemaking
                        power.
                    c. The court will uphold agencies actions unless it is arbitrary or capricious.
                    d. An agency may exercise general rulemaking authority such as that in sec.
                        201 despite the presence of other, specific grants in the statute.
      2. General determinations can be made by statute and by Rules.
            5. Agencies can rely on rulemaking to resolve certain issues of general applicability
                unless Congress explicitly denies such power in the statute.
            6. Only the party is affected by adjudication, everyone is affected by a rule
                    a. American Hospital Assn. v. NLRB (1991) p. 229
                             i. Can an agency resolve issues of general applicability, in cases
                                involving individualized determination, by rule making?
                                    1. Yes.
                            ii. National Labor Relations Board created a substantive rule limiting
                                acute care hospitals to 8 unites of collective bargaining.
                    b. General Rule: You can make general statements by statute or by rule, unless
                        Congress explicitly denies general rules in the statute.
      3. Agencies cannot make ultra vires rules
            7. Sutton v. United Airlines (1999) p. 233

                                              20
                                                                                              -Drinkwine
                      a. FACTS: Under the ADA, two potential pilots claim that they were
                         discriminated against when they were not hired because their uncorrected
                         vision was too poor to fly a plane, but there corrected vision was okay.
                      b. RULE: Agencies cannot interpret the word “disability”
                              i. The agency made an interpretive rule, and Congress didn’t intend
                                  that persons with correctable disabilities fall under ADA protections.
                      c. Agency’s guidelines would turn a mandatory individualized determination
                         into a general determination based on a group of people.
                      d. HOLDING: Affirmed that the case was dismissed properly.
C. Legislative v. Non-Legislative Rules
      1. General
            8. Binding or Non-Binding
                     a. Substantive Rules – Binding
                     b. Interpretive Rules – Non-Binding
                     c. Policy Statements – Non-Binding
                     d. Procedural Rules – Non-Binding
            9. Legislative Rules = Substantive Rules
                     a. Substantive Rules: A rule is substantive if it creates rights, assigns duties, or
                         imposes obligations, the basic tenor of which is not already outlawed in the
                         law itself.
                     b. Legislative Rules: A rule made by some participation of other parites i.e. the
                         public, congress
            10. Non-Legislative rules
                     a. Interpretive, policy, procedural rules; non-binding, no explicit authority
                         necessary, change through the internal agency process.
                     b. Restate or explain existing laws… the do not give any new obligations
            11. Policy Statements
                     a. Statements of Substantive law / policy
                     b. Indicate that the agency is going in a certain direction.
                     c. They are ALWAYS supported by evidence, the rule is the rule unsupported
                         by itself.
      2. Legislative v. Non-Legislative Rules
            12. American Mining Congress. v. Mining Safety & Health Administration
                     a. A Rule is Legislative if you can answer yes to one of the following:
                               i. 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
                              ii. Whether the agency has published this rule in the CFR
                             iii. Whether the agency has explicitly invoked its general legislative
                                  authority; or
                             iv. Whether the rule effectively amends a prior legislative rule.
            13. Substantive Rules, labeled otherwise, still require legislative rulemaking process.
                     a. GE v. EPA
                               i. EPA policy statement was intended to be binding and appeared to
                                  have the force of law – thus it should have been enacted legislatively.
                              ii. The policy document is not binding, because the substantive rule was
                                  not properly created.
            14. If an agency characterizes a rule as a policy, then it has no binding effect. Consol.
                 Edison v. Interstate Natural Gas
D. Legal Effect of Substantive Rules
      1. Agencies are bound to follow its rules and cannot deviate from explicit rules.
            15. Reuters Ltd. v. FCC (1986) p. 244


                                             21
                                                                                               -Drinkwine
                      a. FACTS: The FCC had two rules, a legislative rule requiring that a grant of
                          license be made after 30 days, and a non-legislative rule allowing 60 days.
                          The FCC granted the license and then reclaimed it when someone else
                          applied to the same license.
                      b. FCC realized the conflicting rules were unfair and reclaimed the license to
                          apply an equity approach
                      c. HOLDING: The agency is required to follow its own rules. The 30 day
                          requirement was binding. Agency cannot use equitable deviances away from
                          the rule.
      2. Retroactive Rulemaking is valid if Congress authorizes it, or even if no authorization,
      the particular area in question has not previously been regulated.
              16. Bowen v. Georgetown University Hospita (1988) p. 249
                      a. In 1981, the agency made a rule improperly that was struck down, in 1984,
                          made a new rule under proper procedures, but made the rules apply
                          retroactively to 1981.
                      b. Ultra Vires. Congress did not give authority in the statute.
                      c. Scalia’s Concurring Judgment: The APA defines rules as having an effect on
                          the future. Therefore, they cannot be applied to the past.
              17. Smiley v. Citibank(1996) p.255
                      a. Supreme Court allowed an agency to create a rule and apply it retroactively
                          because the area of law has not been previously regulated before.
E. The Use of Cost-Benefit Analysis in Rulemaking
     xiii. Definition
               1. Utilitarian Ideal – You should take the action if the benefits outweigh the costs.
                      a. Executive Order 12291 – “Regulatory action should not be undertaken unless
                           the potential benefit to society for the regulation outweigh the potential cost
                           to society”
               2. PROBLEM – Diminishing Return
                      a. Cost to Benefit may be valid at one level, but as you increase the level, the
                           return may not increase proportionate to the cost, and the cost may become
                           larger than the benefit.
     xiv. Congress can mandate a cost-benefit analysis in the statute, but if it is not mandated, the
           agency does not have to.
               1. American Textile Manufacturers Inst. v. Donovan (1981) p. 265
                      a. Does OSHA require the Secretary of Labor to conduct a cost-benefit analysis
                           when promulgating a safety standard regarding the exposure to cotton dust?
                                i. No.
                      b. Congress underwent a cost-benefit analysis when it enacted the statute by
                           placing health over all other factors. This is the policy that the agency must
                           carryout.
F. Notice of a Rule – Publication
      1. Introduction
             2. Publication of a rule binds everyone (including the agency itself) to the rule.
             3. If the rule is not published, but you are given notice of the rule, you and only those
                who were given notice are bound by the rule.
             4. APA §552(a)(1)(d) – “Each agency shall separately state and currently publish in the
                Federal Register for the guidance of the public – substantive rules of general
                applicability adopted as authorized by law, and statements of general policy or
                interpretations of general applicability formulated and adopted by the agency.
             5. APA §553 (d) – “The required publications or service of a substantive rule shall be
                made not less than 30 days before its effective date, except…”
             6. APA §552(a)(1) – “Except to the extent that a person has actual and timely notice of
                the terms thereof, a person may not in any manner be required to resort to, or be

                                              22
                                                                                              -Drinkwine
                adversely affected by, a matter required to be published in the Federal Register and
                not so published.”
      2. Analysis
            7. Was the Rule Published?
                    a. If yes, notice is provided and the regulate is bound by the rule
                    b. If no, continue analysis
            8. Did the regulatee have actual notice?
                    a. If yes, notice is provided and the regulate is bound by the rule
                    b. If no, the regulate is not bound by the rule.
      3. Even when an agency gives out wrong information, the published rule is binding.
            9. Federal Crop Insurance Corporation v. Merrill (1947) p. 275
                    a. In Feb. 1945, a rule was published stating that the program would not insure
                        reseeding. In March, Merrill informed the agency that he wanted to insure
                        the reseeding and the agency allowed him to do so. When Merrill’s crop
                        failed and he attempted to claim, was unable to.
                    b. Merill was bound by the rule because it was published, even though the
                        agency gave him the wrong information.
G. Reliance on Agency Advise (Estoppel)
      xv. You cannot use the estoppel argument on the government
               1. Office of Personnel and Management v. Richmond(1990) p.279
                        a. FACTS: Richmond was given advice based on old OPM rules regarding the
                           minimum amount one can earn averaged in two years, vs. the new rule
                           averaging the max. earnings over one year. Richmond lost his benefit, and
                           argued estoppel and that he should get his benefit anyway.
                        b. Holding: under the Appropriations Clause, no payment can be made from the
                           federal treasury without authorization from Congress.
                                 i. Estoppel does not apply to the government because the agency could
                                     do whatever policy it wanted, thus making the government pay
                                     money in retribution of their err.
     xvi. 9th District Court has ruled that you can argue estoppel to waive procedural fees that do not
          come out of the federal treasury.
               1. Brandt v. Hickel (1970) p. 287
                        a. FACTS: Appellants had submitted a noncompetitive oil and gas lease to the
                           BLM who held that the form was defective and allowed the appellant to re-
                           file within 30 days without losing their priority. This promise was not
                           authorized by statute or regulation and so the secretary refused to honor the
                           promise.
                        b. The court ruled that according to estoppel, the Secretary had to honor the
                           priority.
H. Rulemaking Procedure
      1. Where can you find rulemaking procedures?
            2. Statute
                   a. Enabling Statute
                   b. General Statute
                   c. APA
            3. Agency Regulations (current agency rules)
            4. Courts generally CANNOT require more procedures.
      2. Three ways to make a rule.
            5. Informal Rulemaking under §553
                   a. Provides the minimum procedure necessary to make a rule.
            6. Hybrid Rulemaking
                   a. Statutes or Regulations requiring more procedure to make a rule than in
                       §553.

                                              23
                                                                                             -Drinkwine
              7. Formal Rulemaking under §§556-557
                    a. Maximum number of procedures allowed when making a rule.
I. Informal Rulemaking
    xvii. APA §553
            1. Activities exempt from the notice-and-comment procedure
                   a. §553(a) e.g. military affairs.
            2. Notice of proposed rule
                   a. §553(b) – “General notice of proposed rule making shall be made published
                       in the Federal Register, unless personally served or actual notice. The notice
                       shall include:
                             i. (1) a statement of the time, place and nature of public rule making
                                 proceedings;
                            ii. (2) reference to the legal authority under which the rule is proposed;
                                 and
                           iii. (3) either the terms or substance of the proposed rule or a description
                                 of the subjects and issues involved.
            3. Exceptions
                   a. §553(b)(A) for interpretive rules, general statements of policy, or rules of
                       agency organizations, procedure or practice; or
                   b. §553(b)(B) when the agency for good cause finds the notice and public
                       procedure thereon are impracticable, unnecessary, or contrary to the public
                       interest.
            4. Opportunity for Comment
                   a. §553(c) – “After notice required by this section, the agency shall give
                       interested persons an opportunity to participate 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
                   b. after opportunity for an agency hearing, sections 556 and 557 of this title
                       apply instead of this subsection.”
            5. Publications of the final rule
                   a. §553(d) – “The required publication or service of a substantive rule shall be
                       made not less than 30 days before its effective date unless an exception
                       applies.
                             i. This is the final rule.
                   b. No “major” rule can take effect until 60 days after the agency submits to the
                       House, Senate, and the Comptroller General a copy of the rule, a concise
                       general statement about the rule, and the effective date of the rule. “Major
                       rule” is defined as any rule likely to (1) result in an annual effect on the
                       economy of $100,000,000 or more, (2) a major increase in cost prices, or (3)
                       significant adverse effects on competition, employment, investment,
                       productivity, innovation, or on the ability of US-based enterprises to compete
                       with foreign-based enterprises in domestic and export markets.
                   c. An agency’s final rule can differ substantially from the proposed rule
                       contained in its public notice as long as the notice gave fair warning of the
                       possibility of changes of the type that occurred.
                             i. A notice is adequate if it “sufficiently foreshadowed” the final rule or
                                 if the final rule was a “logical outgrowth” of the notice and
                                 consideration of the comments received in response.
J. Hybrid Rulemaking
   xviii. Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council (1978) p.
          293

                                             24
                                                                                              -Drinkwine
               1. Courts cannot impose additional procedural requirement in rulemaking beyond those
                  required by the APA – unless there are extraordinary circumstances.
               2. Congress can by legislation require additional procedural requirements
               3. Agencies may afford more procedures than required by the APA
K. Formal Rulemaking
     xix. Procedure
              1. APA §556 & §557
              2. Looks similar to a trial-like rulemaking procedure where comments and be crossed
                 examined.
      xx. US v. Florida East Coast Railway (1973) p. 300
              1. the making of rules required by statute to be made “after hearing” does not require a
                 full-fledged formal rulemaking-type hearing
              2. §553 APA provides the minimum / maximum procedural requirements unless a
                 statute requires rulemaking “on the record after an opportunity for hearing.”
L. Bias in Rulemaking
     xxi. Association of National Advertisers v. FTC (1979) p. 310
             1. Prejudice/bias in the rulemaking context is not determined as in the adjudication
                 process.
             2. In adjudication, the standard for disqualifying an administrator is whether “a
                 disinterested observer may conclude that [the decision-maker] has in some measure
                 adjudged the facts as well as the law of a particular case in advance of hearing it”.
             3. In rulemaking, an agency member may be disqualified only when there is a (1) clear
                 and convincing showing that he (2) has an unalterably closed mind on matters critical
                 to the disposition of the rulemaking.
M. Ex Parte Communications in Rulemaking (one sided communications)
     xxii. Introduction
               1. In normal litigation, ex parte communications are usually prohibited.
               2. In rulemaking, ex parte rules are more lenient
                       a. Rulemaking within agencies is at its nature a political entity.
    xxiii. Home Box Office, Inc v. FCC (1977) p. 315
               1. Struck down an FCC rule regulating pay-cable television after it was discovered that
                   a number of participants in informal rulemaking had had ex parte communications
                   with the commissioners. The agency justified the rule only based on the public record
                   and failed to mention the ex parte contacts and the substance of this contacts.
               2. The public record must reflect what representations were made to the FCC so that
                   relevant information supporting or refuting those representations may be brought to
                   the attention of reviewing courts
    xxiv. Action for Children’s Television v. FCC (1977) p. 315
               1. The DC Circuit refused to invalidate FCC action in informal rulemaking in which the
                   FCC had received industry proposals for self-regulation “behind closed doors”.
               2. The court refused to follow Home Box Office because it was overbroad and imposed
                   a “novel requirement” that would prohibit or require publication of an opportunity for
                   comments on all ex parte contact, no matter how minor.
               3. The rule is that ex parte contacts do not per se violate agency informal rulemaking.
                       a. This is the case that is more followed today.
N. Rules v. Orders
     xxv. Issues
              1. Do agencies have a choice of whether to proceed by rulemaking or adjudication?
              2. Must agencies announce new rules of law only prospectively through exercise of
                  rulemaking power and restrict particular rights only through decisions in adjudicatory
                  proceedings.
    xxvi. Distinctions between Rules and Orders
              1. Rulemaking

                                              25
                                                                                 -Drinkwine
        a. APA §551(5) Rulemaking: “agency process for formulating, amending, or
            repealing a rule”
        b. APA §551(4) Rule: “agency statement of general or particular applicability
            and future effect designed to implement, interpret, or prescribe law or policy
            or describing the organization, procedure, or practice requirements of an
            agency…”
        c. Rulemaking is done through the notice and comment procedures in §553
            (informal rulemaking) or through §§556-557 (formal rulemaking).
2.   Adjudication
        a. APA §551(6) Order: “final disposition… of an agency in a matter other than
            rulemaking but including licensing.”
        b. APA §551(6) Adjudication: “Agency process for the formulation of an
            order.”
        c. Adjudication can be done through informal or formal adjudication.
3.   Rulemaking through adjudication
        a. Drawback with making rules through adjudication:
                   i. It involves few parties, thus depriving all interested parties with a
                      stake in the outcome from influencing the proceedings;
                  ii. Frequently involves idiosyncratic facts which may mean that an
                      agency can lose sight of broader policy issues;
                 iii. Orders are not published in the Federal Register
                 iv. It is hard to distill a policy with prospective effect from an order
                      which looks like a court decision.
4.   SEC v. Chenery Corporation (1947) p. 325
        a. Whether an agency can lay down new policy in adjudication or whether it
            must do so in rulemaking
                   i. An agency can lay down new policy in adjudication and apply it to
                      the facts at issue.
        b. An agency is not barred from applying a new principle in an adjudicatory
            proceeding simply because it had the power to announce that principle in
            advance by using its power of rulemaking.
        c. While the APA appears to suggest that agencies ought to use rules to
            announce new policy, agencies need this flexibility to deal with complex or
            unforeseen problems.
        d. The choice between proceeding by a general rule or by individual, ad hoc
            litigation is one that lies primarily in the informed discretion of the agency.
        e. Whether the agency’s discretion in choosing was abused would be
            determined by balancing the harm of retroactivity against the problems of
            permitting a bad result because no rule had been adopted to cover the
            particular case.
                   i. Note: Every time the agency applies this rule, it must support its
                      decision as well.
                  ii. Note: There are constitutional limits on this as well.
5.   NLRB v. Wyman-Gordon Co. (1969) p. 316
        a. Whether an agency can promulgate new rules in adjudicatory proceedings
            without complying with the rulemaking procedure in the APA.
                   i. Yes.
        b. §6 of the NLRA empowers the NLRB “to make… in the manner prescribed
            by the APA, such rules and regulations as may be necessary to carry out the
            provisions of this Act.”
        c. The Excelsior rule was not promulgated in accordance with the APA.
        d. There is no questions that in an adjudicatory hearing, the NLRB could
            validly decide the issue whether the employer must furnish a list of

                                26
                                                                                                    -Drinkwine
                             employees to the union. But, in Excelsior, the NLRB did not apply the rule
                             to the parties. Instead, it purported to make a rule.
                         e. Adjudicated cases may serve as a vehicle for the formulation of agency
                             policy. But, that does not mean that policies announced in adjudication are
                             “rules” in the sense that they must, without more, be obeyed by the affected
                             public.
                         f. Here, the NLRB’s order directed the WGCo to furnish the list was part of a
                             valid, proper adjudication involving WGCo and was therefore binding on
                             WGCo. It was not binding in the absence of an order merely because of the
                             Excelsior rule.
                         g. Even in cases involving marked policy departure, agencies are not precluded
                             from announcing new principles in an adjudicative proceeding; the choice
                             between rulmaking and adjudication lies within the agency’s discretion.
                         h. However, there might be situations where reliance on adjudication would
                             amount to an abuse of discretion or a violation of the Act.
                         i. The court appeared to be sensitive to the criticisim ageinst the great
                             discretion of agencies and laid down a number of criteria to examine when
                             determining whether rulemaking through rule or order was more appropriate.
                                   i. The complexity must justify proceeding on a case-by-case basis.
                                  ii. Reliance
                                 iii. New liability suffered.
                                 iv. Fines or penalties.
                         j. Note: This case has been strongly criticized as it seems to inade the due
                             process clause.
                    6. NLRB v. Bell Aerospace Co.
                         a. Can you change your policy that has existed in the past?
                                   i. Yes, but keep in mind those factors as there might be an abuse of
                                      discretion
                                          1. Retroactivity is a big problem
                                          2. Look to the complexity of the issue: the more complex, the
                                               more likely it will be upheld.
                                          3. Reliance – the more reliance there has been on a previous
                                               rule, the less likely the court will allow the agency to change
                                               the rule.
                                          4. New Liability Suffered – If the new rule creates liabilities
                                               that were note there before, then it is less likely to pass the
                                               courts.
                                          5. New Fines or Penalties – If the new rule creates new fines or
                                               penalties, then it probably won’t be upheld.
                                  ii. Note: There has not been a single instance where the court has
                                      struck down such a new policy.

VI.   THE RIGHT TO BE HEARD
      A. Introduction
         xxvii. 5th Amendment:
                     1. “No Person… [shall] be deprived of life, liberty, or property, without the due Process
                        of law…”
        xxviii. 14th Amendment:
                     1. “[N]or shall any State deprive any person of lif, liberty, or property, without due
                        process of law.”
          xxix. The issue is whether an agency
                     1. Has to offer notice and hearing before making decisions,
                     2. If so, when the process has to be offered, and

                                                   27
                                                                                                -Drinkwine
               3. what kind of due process to offer.
B. Legislative v. Judicial Functions
      xxx. Use - When agency makes a rule and you want to argue that a rule can’t be applied to your
           client because due process right has been violated
     xxxi. Analysis – Three main issues to determine if there is Due Process Right.
               1. Do you have a due process right under the 5th Amendment
                         a. Whether this is life, liberty, or property
                         b. Is this deprived?
                         c. Is this a legislative right or a judicial right?
                                   i. Issues of general applicability – resolved by the legislature
                                           1. Legislative (general) Facts – see BiMetallic below
                                           2. No Hearing
                                  ii. Issues of particular applicability – resolved by adjudication
                                           1. Adjudicative (particular) Facts – see Londoner below
                                           2. Hearing Required
               2. If so, when are you entitled to this process?
                         a. Pre-determination; or – see Goldberg below
                         b. Post-determination – see Mathews & others below
               3. Any Exceptions apply?
               4. What Process are you entitled to?
    xxxii. Londoner v. Denver (1908) p. 353
               1. Whether individuals were entitled to a hearing to determine what taxes they would
                    owe for the paving of their street.
                         a. Yes.
               2. Something more than written objection was required here such as the “right to
                    support [the taxpayers] allegations by [oral] argument, however brief; and, if need be,
                    by poof, however informal.
               3. Where the legislature of a state, instead of fixing the tax itself, commits to some
                    subordinate body the duty of determining whether, in what amount, and upon whom
                    it shall be levied, due process of law requires that the taxpayer shall have the
                    opportunity to be heard, of which he must have notice.
                         a. This small number of people were particularly and directly affected…
                              require at least an oral hearing.
   xxxiii. Bi-Metallic Investment Co. v. Colorado (1915) p. 352
               1. whether the due process clause of the 14th Amendment requires a hearing for an
                    individual before a matter affecting everyone equally is decided.
                         a. No.
               2. Where a matter applies to more than a few people, it is impracticable that everyone
                    should have a voice in the adoption of the rule.
               3. When general statutes within the state power are passed that affect the person or
                    property of individuals, their rights are protected by their power over those who make
                    the rule by election.
               4. The issue was on of general applicability applying across-to-board having nothing to
                    do with individualized determination.
                         a. Large number of people affected equally… across the board.
                         b. RULE: If the action is generally applicable, you don’t need a hearing.
   xxxiv. Hollinrake v. Law Enforcement Academy (1990) p. 357
               1. whether an individual is entitled to a hearing when there are no disputed adjudicative
                    facts.
                         a. No.
               2. Here there were no disputed adjudicative facts. The academy denied Hollinrake’s
                    certification based on the result of an eye examination.


                                               28
                                                                                                -Drinkwine
              3. The court noted that in dicta that if certification turns on circumstances peculiar to
                  the applicant, an evidentiary hearing may be required.
              4. The vision requirement was a “generalized legislative fact” and due process does not
                  then require a hearing.
              5. A state must usually provide an individual with an opportunity for a hearing of some
                  so when it takes action of particular applicability, defining a person’s rights, on the
                  basis of adjudicative facts.
                       a. Adjudicative facts are individualized facts concerning the circumstances of
                           the specific party.
                       b. Legislative facts do not relate to particular parties, they are generalized facts
                           which apply more broadly.
                       c. When there are no relevant adjudicative facts in dispute, there is no need for
                           a hearing.
                                i. Court Noted: “If there are disputed facts, then a hearing is needed.”
    xxxv. In re Appeal of Stratton Corporation (1991) p. 361
              1. Does the choice of rulemaking in a statute deny a company due process of law?
                       a. No.
              2. Due process requirements apply to the procedures only if they are adjudicative, rather
                  than legislative, in nature. Adjudication based on the particular facts concerning
                  specific parties triggers procedural due process concerns while a legislative or
                  rulemaking decision which is made on the basis of general facts and has a broad,
                  prospective effect does not.
              3. Whether an agency action is rulemaking or adjudication is determined by analyzing
                  three factors:
                       a. (1) whether the inquiry is of a generalized nature;
                       b. (2) whether the inquiry focuses on resolving some sort of the policy-type
                           question;
                       c. (3) whether the result is of prospective applicability.
              4. A review of these factors in this case show that the reclassification is a rulemaking
                  act.
              5. The fact that Stratton Corporation was the principal land owner affected was not
                  alone enough to turn the case into a contested case because there were other parties in
                  interest as well.
C. Privileges
                      a. Note: Privileges have almost disappeared – privileges are disfavored.
   xxxvi. Smith v. Liquor Control Commission (1970) p.366
             1. Whether the due process clause of the 14th Amendment requires a hearing before
                 revocation of a liquor license.
                      a. No.
             2. The court had consistently held that revocation of beer permits without notice or
                 opportunity for a hearing was constitutional.
             3. A license to sell beer is a privilege granted by the state and is in no sense a property
                 right. When accepting this privilege, the license does to subject to the provisions of
                 the statutes under which it were granted.
                      a. Note: see Brookpark Entertainment v. Taft, below: In this case the court
                          decided liquor licenses were property.
D. Entitlements
   xxxvii. General:
              1. In welfare cases, pre-termination hearing is needed see Goldberg below
              2. In all other cases, post-termination hearing is sufficient see Mathews below
  xxxviii. Goldberg v. Kelly (1970) p. 373
              1. Whether a State which terminated welfare payments to a particular recipient without
                  affording him the opportunity for an evidentiary hearing prior to termination denied

                                               29
                                                                                               -Drinkwine
                  the recipient procedural due process in violation of the Due Process Clause of the 14th
                  Amendment.
                      a. Yes.
             2. Due process is required.
                      a. Welfare benefits are a matter of state entitlements.
                      b. The extent to which procedural process must be afforded recipients is
                           influenced by the extent to which he may be “condemned to suffer grievous
                           loss.”
             3. Pre-termination hearing is necessary.
                      a. The crucial factor in this context is that termination of aid pending resolution
                           of a controversy over eligibility may deprive an eligible recipient of the very
                           means by which to live while he waits.
             4. The extent of the hearing is something less than a full evidentiary hearing
                      a. The New York procedure did not allow recipients to appear in person which
                           was fatal to the constitutional adequacy of the procedure. Is is not enough
                           that a recipient is allowed to submit arguments in writing, especially here as
                           the benefit recipients were not necessarily able to respond in writing. An
                           oral hearing was required (not necessarily a full hearing with trial-like cross
                           examinations).
xxxix.    Brookpark Entertainment Inc. v. Taft (1991) p. 385
             1. Whether in Ohio a statute allowing the revocation of liquor licenses by popular
                  referendum violated the Due Process Clause of the 14th Amendment.
                      a. Yes. The Ohio statute was facially unconstitutional.
             2. A liquor license was property.
             3. A court must look beyond the labels and decide whether it was a property in a
                  functional sense.
             4. A liquor license holds a valuable interest and has a claim of continuation under state
                  law.
   xl.    Economic / Practical Limits on Due Process
             1. Procedural requirements entail the expenditure of limited resources.
             2. At some point, the benefit to the individual from an additional safeguard is
                  substantially outweighed by the cost of providing such protection.
  xli.    Goss v. Lopez (1975) p. 391
             1. Whether public education is an entitlement and whether a student can be suspended
                  10 days or less without a hearing.
                      a. Yes and No.
             2. The Court rejected the school district’s argument that there is no right to a public
                  education.
             3. The students had legitimate claims of entitlement to a public education. Having
                  extended that right to people generally, Ohio may not withdraw that right absent
                  fundamentally fair procedure.
             4. While the school has the authority to prescribe and enforce standards of conduct in its
                  schools, they must be exercised consistently with constitutional safeguards.
             5. To determine whether due process requirements apply in the first place, the Court
                  looks not to the “weight” but to the “nature” of the interest at stake.
             6. At a minimum, students facing suspension must be given “some” kind of notice and
                  afforded “some” kind of hearing.
             7. A student facing temporary suspension has a property interest protected by the Due
                  Process Clause requiring, in connection with suspension of 10 days or less, that the
                  student be given oral or written notice of the charges and if he denies them, an
                  opportunity to present his side of the story.
  xlii.   Mathews v. Eldridge (1976) p. 398


                                              30
                                                                                             -Drinkwine
                                                          th
              1. Whether the Due Process clause of the 5 Amendment requires that prior to the
                 termination of Social Security disability benefit payments the recipient be afforded an
                 opportunity for an evidentiary hearing.
                      a. No.
              2. Test:
                      a. Whether: Procedural due process imposes constraints on governmental
                          decisions which deprive individuals of “liberty” or “property” interests.
                               i. Some form of hearing is required before an individual is finally
                                   deprived of a property interest.
                      b. What/When: Only in Goldberg v. Kelly (see above) has the court held that a
                          hearing closely approximating a judicial trial is necessary (grievous
                          loss/brutal need – welfare case).
              3. Due process is flexible and calls for such procedural protection as is required in a
                 particular situation
              4. The analysis involves a comparison of the governmental and private interests affected
                 by analyzing 3 factors:
                      a. (1) The private interest affected,
                      b. (2) The risk of an erroneous deprivation of the interest and the probable value
                          of additional or substitute procedural safeguards,
                      c. (3) The government’s interest, including the function involved and the fiscal
                          and administrative burden that the additional or substitute procedural
                          requirements would entail.
              5. The Private Interest
                      a. As a successful beneficiary would et retroactive compensation after a
                          successful review, the sole interest is in the uninterrupted receipt of this
                          source of income.
                      b. The potential deprivation is one factor to consider
                      c. The possible length of wrongful deprivation of benefits also is an important
                          factor.
                      d. The hardship imposed on the erroneously terminated disability recipient may
                          be significant but likely less than that of a welfare recipient.
              6. In this Social Security case, the fairness and reliability of the pre-termination
                 procedures and the probable value of any additional procedural safeguards.
                      a. A medical assessment is more focused and easily documented than the
                          typical determination of welfare entitlements.
                      b. Here, the medical evidence relied on was written by medical professionals
                          able to communicate effectively in writing.
                      c. The recipient had full access to all information
                      d. The recipient had an opportunity to submit additional evidence and therefore
                          had an opportunity to “mold” his arguments.
              7. The Public Interest which includes the administrative burden and other societal costs.
                      a. Financial cost alone is not controlling. But, the government/public interest is
                          conserving scarce fiscal and administrative resources must be weighed.
              8. The essence of due process is the requirement that a person in jeopardy os serious
                 loss be given notice of the case against him and opportunity to meet it. All that is
                 necessary is that the procedures be tailored to the capacities and circumstances of
                 those who are to be heard to insure that they are given a meaningful opportunity to
                 present their case.
E. Exception to the Hearing Requirement – Waiver
    xliii. Policy Consideration
               1. The system depends on the waiver exception; otherwise the government would be
                   crippled.
    xliv. National Independent Coal Operator’s Association v. Kleppe

                                             31
                                                                                                   -Drinkwine
                      1. Whether the Federal Coal Mine health and Safety Act requires the Secretary of the
                         Interior to prepare a decision with formal findings of fact before assessing a civil
                         penalty against a mine operator absent a request by the mine operator for an
                         administrative hearing
                             a. No.
                      2. Under the Act, an operator has the right to a hearing, if requested.
                      3. The Statute provides a mine operator with no more than “an opportunity” for a
                         hearing. The word opportunity would be meaningless if the statute contemplated
                         formal adjudicated findings whether or not requested evidentiary hearing is held.
                             a. Constitution required that the opportunity be given (and it was), however, the
                                  party did not exercise its right – therefore waived it.
     F. Exception to the Hearing Requirement – Emergency Cases
          xlv. FDIC v. Mallen (1988) p. 445 –see notes
                  1. Whether a statutory provision authorizing the Federal Deposit Insurance Corporation
                      (FDIC) to immediately suspend from office an indicted official of a federally insured
                      bank with an opportunity for post-suspension hearing was constitutional.
                           a. Yes.
                  2. Mallen’s right to continue to serve as president of the bank is a property right
                      protected by the 5th Amendment Due Process Clause.
                           a. “Whether” Issue
                  3. An important governmental interest, accompanied by a substantial assurance that the
                      deprivation is not baseless or unwarranted, may in limited cases be demanding
                      prompt action justify postponing the opportunity to be heard.
                           a. “When” Issue
                  4. A grand jury determination provides a sufficient basis for an arrest, which constitutes
                      a temporary deprivation of liberty. It is sufficient, when coupled with the
                      congressional finding that a prompt suspension is important to the integrity of our
                      banking institution, to support the order in this case.
                  5. There is a point at which an unjustified delay in compelling a post-deprivation
                      proceeding would become a constitutional violation. It is appropriate to examine:
                           a. The importance of the private interest and the harm to this interest
                               occasioned by delay.
                           b. The justification offered by the government for delay and its relation to the
                               underlying government interest, and
                           c. The likelihood that the interim decision may have been mistaken.
                  6. The congressionally recognized interest in maintaining confidence in the banking
                      institutions, coupled with the finding of probable cause that the officer had
                      committed a felony involving dishonesty, was sufficient ground for a regulatory
                      suspension of up to 90 days without the benefit of a post-suspension rule.
     G. Exception to the Hearing Requirement – Additional Exceptions
          xlvi.   No Facts in Dispute
         xlvii.   Legislative Facts – General applicability across the board
        xlviii.   Mathematical Testing
          xlix.   Purely Administrative Procedure

VII. EVIDENTIARY HEARINGS AND DECISIONS
     A. Parties in Interest and Intervention
             l. Introduction
                    1. This section discusses what goes on in theses hearings:
                            a. Who gets to attend
                            b. Bias
                            c. Administrative Law Judges
                            d. Evidentiary Support you need

                                                     32
                                                                                                    -Drinkwine
                        e. Burden of Proof
      li. Rule:
             1. A prospective intervener must show specific allegations of fact sufficient to show
                that it is a party in interest.
             2. An agency has broad discretion in establishing and applying rules for public
                participation.
             3. Mutually exclusive applications must be comparatively reviewed.
B. Who can be heard
      lii. Summary
               1. You can intervene if you can show that you are a party in interest see Office of
                   Communications below.
               2. The Agency has broad discretion
               3. If you have mutually exclusive claims, then you must hear them together see
                   Sarasota County Public Hospital below.
     liii. Office of Communications v. FCC (1966) p. 463
               1. Whether the OCC has standing before the FCC as a party in interest and whether the
                   FCC was required to conduct an evidentiary hearing on the claims of the OCC prior
                   to renewing the license.
                        a. Yes on both issues.
               2. The concept of standing had not been static.
               3. Congress appeared to have recognized that the issue was best left to the courts.
               4. The concept of standing was a practical and functional one designed to insure that
                   only those with a genuine and legitimate interest can participate in a proceeding.
               5. Unless listeners have standing there must be no other way to bring certain types of
                   complaints to the FCC’s attention.
               6. To prevent overburdening the agency, a prospective intervener must show specific
                   allegations of fact sufficient to show that it is a party in interest and that a grant of the
                   renewal application would be prima facie inconsistent with the public interest.
               7. The FCC should have broad discretion in establishing and applying rules for public
                   participation.
               8. Intervention on behalf of the public is not allowed to press private interest but only to
                   vindicate the broad public interest relating to a licensee’s performance of the public
                   trust inherent in a license.
                        a. Note: This is a landmark case in the movement to broaden the right to
                             participate in agency proceedings. Such broadening of intervention has
                             become one of the foundations of the law of environmental issues, consumer
                             protection, and other areas of public interest law.
     liv. If you have a traditional pocketbook injury, you will be granted standing, if you just have a
           public interest, you must whow some sort of injury.
      lv. Sarasota County Public Hospital v. Department of Health (1989) p. 474
               1. Whether both two parties submitting mtually exclusive applications have a right to be
                   heard.
                        a. Yes.
               2. The agency was concerned with the duplication of services. Therefore, the
                   applications were mutually exclusive and had to be comparatively reviewed.
               3. In Ashbacker, the Supreme Court held that the granting of one of two bona fide and
                   mutually exclusive applications for administrative approval without a hearing on both
                   deprives the loser of the hearing to which he was entitled and resulted in a material
                   error in procedure.
               4. Based on the fundamental doctrine of fair play.
C. Notice and Pleadings
     lvi. APA §554(b)
            1. Persons entitled to notice of an agency hearing shall be timely informed of –

                                                 33
                                                                                                 -Drinkwine
                      a. The time, place, and nature of the hearing;
                      b. The legal authority and jurisdiction under which the hearing is to be held;
                          and
                      c. The matters of fact and law asserted.
    lvii. Yellow Freight System v. Martin(1992) p. 478
              1. Whether the agency’s finding of a violation involving an allegation not given notice
                 of, and its refusing to reopen the administratice record to allow evidence on this
                 allegation was a violation of due process.
                      a. Yes. The court refused to enforce the Secretary’s decision.
              2. The fundamental elements of procedural due process are notice and the opportunity
                 to be heard.
              3. An agency must give the party charged a clear statement of the theory on which the
                 agency will proceed with the case.
              4. An agency may not change theories in midstream without giving respondents
                 reasonable notice of the change
              5. Due process is not violated if an agency decides an issue the parties fairly and fully
                 litigated at the hearing.
              6. The general rule is that when issues not raised in pleadings are raised by the express
                 or implied consent of the parties, the court may treat the issues in all respects as if the
                 parties had raised them in the pleadings.
D. Counsel
    lviii. APA §555(b)
              1. “A person compelled to appear in person before an agency or representative thereof
                  is entitled to be accompanied, represented, and advised by counsel… A party is
                  entitled to appear in person or by or with counsel in agency proceedings.
      lix. Department of Labor v. Triplett (1990) p. 491
              1. Whether a statutory/administrative cap on attorney’s fees violated benefit claimants
                  due process rights by making counsel unavailable.
                       a. No.
              2. The government was an interest in administering benefits so that claimants receive
                  the entirety of an award without having to divide it with a lawyer.
              3. Those challenging the law must make an extraordinarily strong showing of
                  probability of error under the present system to warrant a holding that the fee
                  limitation denies claimants due process of law.
              4. The court rejected anecdotal evidence that attorneys were unwilling to take black
                  lung cases
              5. Such evidence does not overcome the presumption of regularity and constitutionality
                  to which a program established by Congress is entitled.
              6. Statistical evidence showed that most claimants were represented.
              7. Even if Triplett had been able to demonstrate the unavailability of attorneys, Triplett
                  had not proven causation.
E. From Examiners to Administrative Law Judges.
      lx. Summary ALJs
              1. Deciding officers need to actually hear the witnesses’ testimony but may rely on a
                 written record.
              2. ALJs are entitled to pay prescribed by the Office of Personnel Management
                 independently of agency recommendations or ratings
              3. ALJs may be removed only for good cause established and determined by the Merit
                 Systems Protection Board on the record after opportunity for hearing before the
                 board.
              4. ALJs write the initial decision which the agency is free to adopt or reject.
     lxi. Pre APA
              1. Problems

                                               34
                                                                                               -Drinkwine
                        a. Agency Hearings were conducted by hearing examiners
                        b. Examiners were agency employees subject to agency pressure and
                           disciplinary actions.
                        c. The agency controlled their pay.
                        d. Sometimes the hearing examiner had also conducted the investigation.
               2. Morgan, Mackay, & Guerrero Cases
                        a. Deciding officers need to actually hear the witnesses’ testimony by may rely
                           on a written accord.
                        b. It is enough for a decision to be based solely on considered review of the
                           evidence and legal arguments.
                        c. Evidence may be take by an examiner
                        d. Evidence thus taken may be sifted and analyzed by competent subordinates.
    lxii.    APA §556(b) Hearings: Presiding Employees
               1. There shall preside at the taking of evidence (§§553, 554)
                        a. (1) the agency;
                        b. (2) one or more members of the body which comprises the agency; or
                        c. (3) one or more ALJs.
               2. Savings Clause
    lxiii.   APA §3105 Appointment of ALJs
               1. Each agency shall appoint as many ALJs as are necessary.
               2. ALJs may not perform duties inconsistent with their duties and responsibilities as
                   hearing examiners.
    lxiv.    APA §5362 ALJs
               1. ALJs are entitled to pay prescribed by the Office of Personnel Management
                   independently of agency recommendations or ratings.
     lxv.    APA §7521(a) Removal
               1. ALJs may be removed only for good cause established and determined be the Merit
                   Systems Protection Board on the record after opportunity for hearing before the
                   Board.
    lxvi.    APA §556(c) ALJ Duties
               1. Administer oats and affirmations
               2. Issue subpoenas
               3. Rule upon offers of proof and receive evidence
               4. Take or cause the taking of depositions
               5. Hold conferences for settlement or simplification of issues.
               6. Dispose of procedural requests or similar matters
               7. Question witnesses.
               8. Consider the facts in the record, arguments, etc.
               9. Determine credibility of witnesses and make findings of fact and conclusions of law.
               10. make decisions on the basis of reliable, probative, and substantial evidene on the
                   record.
               11. Take any other action authorized by agency rule that is consistent with the provisions
                   of the APA.
F. Bias
    lxvii. Examples of bias:
                      a. Pecuniary interest.
                              i. Direct – Tumey (see below mayor’s court traffic offenses)
                             ii. Indirect – Gibson (see below optometrists)
                      b. Pre-judgment of facts.
                      c. Personal bias/prejudice.
   lxviii. APA §556(b)
              1. [Hearings] shall be conducted in an impartial manner. A presiding or participating
                 employee may at any time disqualify himself. On the filing in good faith of a timely

                                               35
                                                                                                -Drinkwine
                    and sufficient affidavit of a personal bias or other disqualification of a presiding or
                    participating employee, the agency shall determine the matter as a part of the record
                    and decision in the case.
    lxix.    Tumey v. Ohio (1927) p. 510
                1. A mayor’s court convicted an individual of a traffic offense. The mayor shared in the
                    fees and costs levied against convicted violations.
                2. The Supreme Court held that this gave the mayor a direct pecuniary interest that
                    rendered his decision voidable. A system which the judge is paid when he convicts
                    cannot be regarded as complying with due process requirements.
     lxx.    Gibson v. Berryhill (1973) p. 509
                1. Whether a state agency consisting of members with a financial stake in the outcome
                    of a hearing are so biased as to deprive the “defendant” of due process of the law.
                        a. Yes.
                2. Those with substantial pecuniary interest in legal proceedings should not adjudicate
                    those disputes.
                3. The financial stake need not be as direct and positive as in Tumey v. Ohio.
                4. Most of the law concerning disqualifications from legal proceedings because of
                    interest applies with equal force to administrative adjudicators.
                5. Lee Optical Co. was doing a lot of business in Alabama and if it were forced to
                    suspend operations, the individual members of the board would fall heir to its
                    business as the board members were private optometrists.
    lxxi.    How do you handle bias in real life?
                1. You must say something on the record so that it can be reviewed by a higher
                    court/authority.
    lxxii.   Exceptions – It is okay to be bias in adjudicatory cases when:
                1. Necessity
                        a. Bias is okay if there is no one else to hear the case.
G. Combination of Functions – (during adjudication… not rulemaking)
   lxxiii. Mirrors the Separation of Powers doctrine in the constitution, this separates the powers of the
           agencies which are allowed to yield all three powers.
               1. It is a good idea to at least separate the people who enforce each power.
   lxxiv. APA §554(d) – The employee who presided at the reception of evidence pursuant to §556…
           may not:
               1. (1) consult a person or party… unless on notice and opportunity for all parties to
                   participate; or
               2. (2) be responsible to or subject to the supervision or direction of an employee or
                   agent engaged in the performance of investigative or prosecuting functions for an
                   agency. An employee or agent engaged in the performance of investigative or
                   prosecuting function for an agency in a case may not in that or a factually related
                   case, participate or advise in the decision… except as witness or counsel in public
                   proceedings.
    lxxv. Exception
               1. This does not apply to the agency head.
H. Evidence
   lxxvi. Introduction
              1. Much more relaxed than federal rules of evidence or state rules of evidence
              2. Emphasizes more on common sense and efficiency
                      a. Must fulfill the APA rules, agency rules, statutory rules
                             i. If it is relevant, material, reliable…
              3. APA §556(d)
                      a. Any oral or documentary evidence may be received, but the agency as a
                         matter of policy shall provide for the exclusion of irrelevant, immaterial, or
                         unduly repetitious evidence.

                                                36
                                                                                              -Drinkwine
                       b. A sanction may not be imposed or rule or order issued except on
                           consideration of the whole report or those parts thereof cited by a party and
                           reliable, probative, and substantial evidence.
                       c. A party is entitled to present his case or defense by oral or documentary
                           evidence, to submit rebuttal evidence, and to conduct such cross-examination
                           as may be required for a full and true disclosure of the facts.
   lxxvii. Wagstaff v. Department of Employment Security (1992) p.539
              1. May an agency base its decision solely on incompetent (hearsay) evidence?
                       a. No. The decision must be supported by a residuum of legal evidence
                           competent in a court of law.
  lxxviii. Richardson v. Perales (1971) p. 542
              1. Whether physicians’ written reports of medical examinations the have made of a
                  disability claimant may constitute “substantial evidence” supportive of a finding of
                  non-disability when the claimant objects to the admissibility of those reports and
                  when the only live testimony is presented by the claimant and is contrary to the
                  reports.
                       a. Yes.
              2. From the Social Security Act and the regulations adopted thereunder, the Court
                  concluded that:
                       a. (a) the Congress granted the Secretary the power by regulation to establish
                           hearing procedures.;
                       b. (b) strict rules of evidence are not applicable to bar evidence otherwise
                           pertinent; and
                       c. (c) the conduct of the hearing rests generally in the examiner’s discretion.
              3. Although they are hearsay, they were admissible if reliable and probative.
              4. A (1) written report by (2) a licensed physician (3) who has examined the claimant ad
                  (4) who sets forth in his report his medical findings (5) in his area of competency
                  may be received as evidences in a disability hearing and, despite its hearsay character
                  and an absence of cross-examination, and despite the presence of opposing direct
                  medical testimony and testimony of the claimant himself, may constitute substantial
                  evidence supportive of a finding adverse to the claimant, (6) when the claimant has
                  not exercised his right to subpoena the reporting physician and thereby provide
                  himself with an opportunity for cross-examination of the physician.
              5. The reports were made by qualified physicians who had examined Perales.
              6. The vast workings of the social security administration system makes for reliability
                  and impartiality in the consultant reports.
              7. Medical reports are detailed and valuable. They are routine, standard, unbiased, and
                  made by specialists.
              8. The reports present the impressive range of examination to which Perales was
                  subjected.
              9. There are no inconsistencies in the reports.
              10. From a pragmatic standpoint, requiring live testimony in all cases would lead to a
                  heavy administrative burden.
I. Burden of Proof
   lxxix. APA §556
              1. “Except as otherwise provided by statute, the proponent of a rule or order has the
                  burden of proof.”
    lxxx. Director, Office of Workers Compensation Programs v. Greenwich Collieries (1994) p. 552
              1. Whether the “true doubt” rule, shifting the burden of persuasion to the party opposing
                  a benefits claim, is this consistent with §556(d) APA which states that the proponent
                  of a rule or order has the burden of proof.
                      a. No.


                                              37
                                                                                              -Drinkwine
               2. The court rejected the Department’s argument that §556(d) did not apply (§556(d)
                  states: “Except as otherwise provided by statute”).
                       a. The assignment of the burden of proof is a rule of substantive law
                       b. The LHWCA and BLBA did not contain anything indicating that the APA
                           did not apply.
               3. §556(d) provides that when the evidence is evenly balanced, the claimant must lose.
                  Hence, the true doubt rule violated the APA.
J. Illegal Evidence
    lxxxi. Introduction
               1. 4th Amendment – Search and Seizure procedures do not allow evidence illegally
                   collected to be used in court.
               2. How does this fit into Administrative Proceedings?
   lxxxii. Powell v. Secretary of State (1992) p. 561
               1. Whether the 4th Amendment precludes the use of illegally obtained evidence in an
                   administrative driver’s license suspension hearing.
                       a. No.
               2. The exclusionary rule’s primary purpose is to deter unlawful police conduct.
                       a. Generally limited to criminal cases.
               3. The court used a balancing test weighing the likely social benefits of excluding
                   evidence flowing from an unlawful seizure against the likely costs and benefits of
                   using such evidence in a civil proceeding.
                       a. The court found that the exclusionary rule should not be applied here.
               4. The evidence had already been excluded from the criminal proceeding and there
                   would be little additional deterrent effect on police conduct by preventing
                   consideration of the evidence by the hearing examiner.
               5. The cost to society resulting from excluding the evidence would be substantial: the
                   purpose of the administrative license suspension is to protect the public.
                       a. Cost benefit analysis – weigh the interests of the government v. the cost to
                           the individual.
                                 i. First must show that there is a violation of the 4th Amendment
                                ii. Next you must balance that use.
K. Exclusiveness of Record
  lxxxiii. Introduction
               1. The record only stays open for so long (by statute or rule).
                        a. If you miss your deadline, you miss your chance.
               2. By putting it on the record, it makes the information available so everyone can see…
                   thus your due process rights are fulfilled.
  lxxxiv. APA §556(e)
               1. “The transcript of testimony and exhibits, together with all papers and requests filed
                   in the proceeding, constitutes the exclusive record for decision…”
   lxxxv. Banegas v. heckler (1984) p. 569
               1. Whether the ALJ may rely on his own out-of-hearing / not on record observations in
                   deciding a case.
                        a. No.
               2. The ALJ performs the dual role of judge and trier of facts.
               3. An ALJ may observe the claimant during an administrative hearing, and based
                   his/her conclusion as to the severity of the claimant’s pain upon such observations.
               4. An ALJ may no go beyond his role as judge and juror and become a witness in the
                   case.
L. Official Notice
  lxxxvi. Scope
             1. Broader in scope than judicial notice
             2. Agencies are experts in what they due

                                              38
                                                                                                -Drinkwine
             3. Official notice may not be taken of “litigation facts.” Only facts known through the
                 usual course of agency business, which, having emerged from numerous cases, have
                 become part of the factual equipment of the administrative expert, may be noticed.
  lxxxvii. APA §556(e)
             1. “When an agency decision rests on official notice of a material fact not appearing in
                 the evidence in the record, a party is entitled, on a timely request, to a opportunity to
                 show the contrary.”
M. Decision Process
 lxxxviii. Summary
               1. The agency makes the decision in adjudication
               2. ALJs/hearing officers hear the cases and makes an initial decision which may
                   become final unless challenged.
               3. If challenged, the agency hears the case de novo and may disregard the ALJ’s
                   findings.
               4. Consult §557(c)
   lxxxix. APA §557(b)
               1. When the agency did not provide at the reception of the evidence, the presiding
                   employee… shall initially decide the case unless the agency requires… the entire
                   record to be certified to it for decision.
               2. When the presiding employee makes an initial decision, that decision then becomes
                   the decision of the agency without further proceedings unless there is an appeal…
               3. On appeal from or review of the initial decision, the agency has all the powers which
                   it would have in making the initial decision…
               4. When the agency makes the decision without having presided at the reception of the
                   evidence, the presiding employer… shall first recommend a decision.
        xc. APA §557(c)
               1. Before a recommended decision… the parties are entitled to a reasonable opportunity
                   to submit:
                        a. (1) proposed findings and conclusions; or
                        b. (2) exceptions to the decisions or recommended decisions…; and
                        c. (3) supporting reasons for the exceptions or proposed findings or
                            conclusions.
               2. the record shall who the ruling on each finding, conclusion, or exception presented.
                   All decisions, including initial, recommended, and tentative decisions, are a part of
                   the record…
       xci. FCC v. Allentown Broadcasting Co. (1955) p. 600
               1. Whether the agency may disregard the ALJ’s initial decision, including the ALJ’s
                   findings about the credibility of witnesses.
                        a. Yes.
               2. The AC’s conclusion of error as to the evasiveness of witnesses relied largely on its
                   understanding that the Examiner’s findings based on demeanor of a witness were not
                   to be overruled by a Board without a very substantial preponderance in the record.
               3. This attitude went too far because it seemed to adopt for examiners of administrative
                   agencies the “clearly erroneous” rule.
      xcii. APA §557(b)
               1. “On appeal from or review of the initial decision, the agency has all the powers
                   which it would have in making the initial decision…”
     xciii. Crawley v. Department of Highway Safety (1993) p. 603
                        a. Note: This is a state agency. State admin law may be different.
               2. Whether a state agency may substitute its own judgment for the hearing officer’s as
                   to issues of fact.
                        a. No.


                                               39
                                                                                               -Drinkwine
             3. The determination of whether a violation of policy is willful is “susceptible to
                  ordinary methods of proof” and is “not infused with policy considerations”.
             4. The determination of whether Crawley acted willfully in violating the rules and
                  regulations is a factual determination to be made by the hearing officer.
             5. PERC may not reject the hearing officer’s finding unless there is no competent
                  substantial evidence from which the finding could reasonably be inferred.
    xciv. Eads v. Secretary of Health and Human Services (1993) p. 604
             1. Whether a reviewing court must take into consideration evidence not before the ALJ
                  when reviewing the ALJ’s decision.
                       a. No.
             2. When the Council has refused to review the case, the decision reviewed in the courts
                  is the decision of the ALJ. The correctness of that decision depends on the evidence
                  that was before the ALJ. An ALJ cannot be faulted for having failed to weigh
                  evidence never presented to him.
             3. Eads did not file an application for reconsideration for newly discovered evidence,
             4. Eads did not ask for a review of the Appeals Council’s refusal to review the ALJ
                  decision.
             5. Instead, Eads argued that the court should reverse the denial of disability benefits on
                  the ground that the ALJ’s decision is erroneous when evaluated in the light of all the
                  evidence in the case, including evidence that the ALJ could not have considered as it
                  was not in front of him.
N. Making the Decision
     xcv. Babac v. Milk Marketing Board (1990) p. 607
                     a. Note: Federal rules are different.
             2. Whether agency members may participate in a hearing via speaker phone and
                 whether such participation is counted towards a quorum requirement.
                     a. No. The agency members must participate in person.
O. Findings of Fact and Conclusions of Law
     xcvi. Summary
               1. An Agency’s decision must clearly and precisely state what it finds to be the facts
                    and why those facts rationally lead to the decision it makes.
    xcvii. APA§557(c)(3)
               1. All decisions shall include a statement of:
                        a. (A) findings and conclusions, and the reasons or basis therefore, on all the
                             material issues of fact, law, or discretion presented on the record; and
                        b. (B) the appropriate rule, order, sanction, relief, or denial thereof.
   xcviii. Policy behind APA §557(c)(3)
               1. Prevent arbitrary and capricious decisions in a manner violating due process;
               2. Serve as an explanation to the parties involved as to the basis for the decision;
               3. Give guidance to parties similarly situated; and
               4. Provide a basis for judicial review by the courts.
     xcix. As counsel, you have the right to file your own findings of fact and conclusions of law before
           the final decision is made.
        c. Adams v. Board of Review (1991) p. 609
               1. Whether it is enough for an agency to make a finding on the ultimate issue without
                    disclosing the steps leading up to that conclusion?
                        a. No.
               2. An administrative agency must make findings of fact and conclusions of law that are
                    adequately detailed to permit meaningful appellate review.
               3. The failure of an agency to make adequate findings of fact renders its finding
                    arbitrary and capricious unless the evidence is clear, uncontroversial and capable of
                    only one conclusion.


                                              40
                                                                                                    -Drinkwine
                  4. The agency must make findings of fact on all necessary ultimate issues and
                       subsidiary findings in sufficient detail to disclose the steps by which the ultimate
                       factual conclusions are reached.
                  5. A finding may be implied. However, the party wishing to defend an agency decision
                       must carry its burden of showing that the undisclosed finding was actually made.
                           a. The findings of fact must indicate what the ALJ determined occurred, not
                                merely what the contradictory evidence indicates might have occurred.
           ci. De St. Germain v. Employment Division (1985) p. 616
                  1. Whether an ALJ’s decision may rely on conslusory statements.
                           a. No. The decision must clearly and precisely state the facts and why those
                                facts rationally lead to the decision.
                  2. “This is a case which generates a judicial version of the primal scream”
                  3. The EAB had not demonstrated why it was impossible under the “good cause”
                       standard, accepting the employer’s version, that a reasonable and prudent person of
                       normal sensitivity, acting under common sense in such circumstances, would not
                       leave his work.
                  4. An agency’s decision must clearly and precisely state what it finds to be the facts and
                       why those facts rationally lead to the decision it made.
                  5. The absence of demonstrably reasoned conclusions would ordinarily require
                       reconsideration by the EAB
                  6. Here, the referee’s reasoning consisted of two conclusory statements. For example,
                       the referee did not explain why the employee’s reasons for leaving work were not
                       compelling.
                           a. In this case the decision must be remanded back to the Agency.

VIII. JUDICIAL REVIEW
     A. Introduction
             i. This section applies only to the court’s involvement in Agency Administrative Law
            ii. Issues covered:
                    1. Whether you can review the decision?
                    2. Who can review the decision – Who has standing?
                    3. When can you review the decision?
                    4. What standard of review can you apply?
     B. Jurisdiction – Statutory Silence, Preclusion, Discretion
           iii. Introduction & Overview of the Law
                    1. US Constitution only gives Article III Courts jurisdiction on very limited matters.
                        The Constitution gives Congress the ability to determine any further jurisdiction of
                        the courts in matters not listed in the Constitution.
                    2. Marbury v. Madison gives the courts the ability to review all constitutional issues –
                        Courts presume that Congress has not limited jurisdiction unless there is a clear and
                        convincing evidence to the contrary.
                    3. General Rule: If the statute specifically precludes judicial review, then it is not
                        available except in cases regarding constitutional issues.
                    4. Statutory review v. Non-Statutory Review
                            a. Statutory Review: JR under an affirmative statute in which Congress states
                                that JR can be had before a particular court
                                      i. Review on the merits and any other claim
                            b. Non-Statutory Review: JR under general jurisdictional statutes to hear
                                “common law” – type claims challenging the constitutionality of the agency
                                actions.
                                      i. No review on the merits; only constitutional clams (and ultra vires
                                         claims).
                            c. Statutory Silence

                                                   41
                                                                                              -Drinkwine
                                i. Congressional silence most likely cuts off statutory review
                               ii. Congressional silence does not cut off non-statutory review
                       d. Statutory Preclusion
                                i. Preclusion cuts off statutory review
                               ii. Preclusion almost certainly does not cut off non-statutory review –
                                   cases are not conclusive… if it did, it would overrule Marbury v.
                                   Madison.
                       e. Statutory Discretion
                                i. Discretion cuts off statutory review
                               ii. Discretion most likely does not cut off non-statutory review
      iv. Judicial review of an agency decision is available when the agency’s enabling statute is silent
          and Congress appears to have intended for judicial review.
              1. Stark v. Wikard (1944) p. 629
                       a. Whether judicial review of an agency decision is available even though the
                          statute is silent on the issue/
                                i. Yes.
                       b. The court was able to determine what Congress had intended and ruled that it
                          intended for there to be judicial review.
                       c. Federal Courts presume that Congress intended to allow for judicial review
                          unless there is a “showing of clear and convincing evidence” of
                          congressional intent to restrict review.
                       d. Congressional silence cuts off statutory review, i.e. judicial review under
                          statute.
                       e. Congressional silence does not cut off non-statutory review, i.e. “common
                          law” doctrines to challenge government acts (e.g. ultra vires).
C. Statutory Preclusion and Agency Discretion
        v. APA §702
               1. “ A person suffering legal wrong because of agency action, or adversely affected or
                   aggrieved by agency action within the meaning of a relevant statute, is entitled to
                   review thereof.”
       vi. APA §701 (a) – Judicial review is not available “to the extent that –
               1. (1) statute preclude judicial review
               2. (2) agency actions are committed to agency discretion by law.”
      vii. If you have a statute that precludes judicial review, you cannot use the APA to get judicial
           review.
     viii. Abbott Labs v. Gardner (1967) p. 634
               1. The statute is explicit denying judicial review.
               2. The statute does not preclude constitutional claims.
               3. There is a presumption in favor of judicial review unless there is a “showing of clear
                   and convincing evidence” of congressional intent to restrict review.
D. Statutory Preclusion
      ix. If you have a statute that precludes judicial review, you cannot use the APA to get judicial
          review.
       x. Department of Environment Protection v. Civil Service Commission (1991) p. 635
              1. Whether Section 76 of the Civil Service Law, providing that a decision of an agency
                  “shall be final and conclusive, and not subject to further review in any court,”
                  precludes judicial review.
                       a. Yes, it precludes statutory review, but does not preclude non-statutory
                           review.
              2. Judicial review is mandated when the agency has acted illegally, unconstitutionally,
                  or in excess of its jurisdiction.
              3. When the court decides the constitutional issues, it must stop there. There is an
                  extremely narrow standard of review thus, it cannot decide the merits of the case.

                                              42
                                                                                             -Drinkwine

E. Agency Discretion
      xi. Summary
             1. When something is left to the agency for discretion by the statute, it does not give the
                 court any standards to comparer the decision to.
     xii. Webster v. Doe (1998) p. 638
             1. Whether the decision of the Director of the CIA to terminate an employee is
                 judicially unreviewable because the decision was discretionary under the statute, and
                 whether is was unreviewable because the statute precluded all judicial review.
                      a. Yes and no.
             2. §701(a) limits application of the entire APA to situations in which (1) judicial review
                 is not precluded by statute, and (2) the agency action is not committed to agency
                 discretion by law.
                      a. Subsection (a)(1) is concerned with whether Congress expressed an intent to
                          prohibit judicial review, Subsection (a)(2) applies in those rare instances
                          where statutes are drawn in such broad terms that… there is no law to apply
                          [for the reviewing court].
             3. Under §701(a)(2) even when Congress has not affirmatively precluded judicial
                 oversight, “review is not to be had if the statute is drawn so that a court would have
                 no meaningful standard against which to judge the agency’s exercise of discretion.”
             4. §102(c) of the National Security Act allows termination of an Agency employee
                 whenever the Director “shall deem such termination necessary or advisable in the
                 interest of the United States.”
                      a. This standard fairly exudes deference to the Director, and appeared to the
                          court to foreclose the application of any meaningful judicial standard of
                          review.
             5. §701(a)(2) accordingly precluded statutory judicial review of the termination
                 decision.
             6. However, §102(c) NSA did not exclude review of constitutional claims.
             7. Where Congress intends to preclude judicial review of constitutional claims its intent
                 to do so must be clear.
                      a. §701(a)(1) and (a)(2) remove from judicial review only those determinations
                          specifically identified by Congress or “committed to agency discretion by
                          law”.
             8. Nothing in §102(c) persuaded the Court that Congress meant to preclude
                 consideration of colorable constitutional claims arising out of the actions of the
                 Director pursuant to that section.
    xiii. Heckler v. Chaney (1985) p. 643
             1. Whether a decision of an administrative agency to exercise the “discretion” not to
                 undertake certain enforcement actions is subject to judicial review.
                      a. No.
             2. Judicial review is available “except to the extent that…agency action is committed to
                 agency discretion by law.”
             3. The Supreme Court disagreed with the AC’s insistence that the narrow construction
                 of §701(a)(2) required application of a presumption of reviewability even to an
                 agency’s decision not to undertake certain enforcement actions.
             4. An agency’s decision not to prosecute or enforce is a decision generally committed to
                 an agency’s absolute discretion because of needed expertise.
                      a. When an agency refuses to act it generally does not exercise its coercive
                          power over an individual’s liberty or property rights and thus does not
                          infringe upon areas that courts often are called upon to protect.
             5. The decision is highly presumptively unreviewable; the presumption may be rebutted
                 where the substantive statute has provided guidelines for the agency to follow in
                 exercising its enforcement powers, i.e. little discretion.

                                             43
                                                                                                -Drinkwine
              6. In this case, the presumption is not overcome by the enforcement provisions of the
                 FDCA.
F. Standing
     xiv. Introduction
              1. Whether or not the proper persons are before the court – regards the parties involved.
              2. Constitution Article III only allows cases and controversies.
              3. Prudential Standing, court discretion
              4. MUST meet both constitutional and prudential requirements for standing.
              5. Congress can always require more standing through statute, but it must meet the
                   minimum constitutional standing.
      xv. Article III Standing Requirements – the bare minimum requirements
              1. (1) injury in fact: an invasion of a legally protected interest which is (a) concrete and
                   particularized and (b) “actual or imminent, not conjectural or hypothetical.”
              2. (2) traceability/causation – a causal connection between the injury and the conduct
                   complained of – the injury has to be fairly… trace[able] to the challenged action of
                   the defendant, and not… the result [of] the independent action of some third party not
                   before the court.”
              3. (3) redressability – it must be “likely,” as opposed to merely “speculative” that the
                   injury will be “redressed by a favorable decision”.
     xvi. Prudential Standing Requirements – Discretionary requirements determined by the Court
              1. The plaintiff must be within the zone of interest protected by the statute.
                       a. (1) Determine the interest protected;
                       b. (2) Determine whether the plaintiff’s interest fall within.
              2. It is not necessary to determine whether Congress intended to protect the would-be
                   plaintiff, the proper inquiry is whether the interest sought to be protected is arguably
                   within the zone of interests to be protected by the statute.
    xvii. APA §702
              1. “A person suffering legal wrong because of agency action, or adversely affected or
                   aggrieved by agency action within the meaning of a relevant statute, is entitled to
                   seek judicial review thereof.”
   xviii. Valley Forge Christian College v. Americans United (1975) p. 650
              1. Article III requires a party who invokes the court’s authority to show:
                       a. (1) that he personally has suffered some actual or threatened injury;
                       b. (2) that the injury fairly can be traced to the challenged action; and
                       c. (3) is likely to be redressed by a favorable decision.
     xix. Flast v. Cohen (1968) p 651
              1. To have taxpayer standing, two criteria must be met:
                       a. (1) The taxpayer attack must be against an expenditure that is an exercise of
                            power under the taxing and spending clause; and
                       b. (2) The taxpayer must show that a challenged expenditure exceeds a specific
                            constitutional limitation upon taxing and spending power.
      xx. Air Courier v. Postal Workers Union (1991) p. 652
              1. Whether postal employees are within the “zone of interests” of the Private Express
                   Statutes, so that the may challenge the action of the United States Postal Service in
                   suspending the operation of the PES with respect to a practice of private courier
                   service called “international remailing”.
                       a. No.
              2. To establish standing under §702 APA, respondents must establish:
                       a. (1) that they have suffered a legal wrong because of the challenged agency
                            action, or are adversely affected or aggravated by agency action within the
                            meaning of a relevant statute; and
                       b. (2) that they are within the zone of interests sought to be protected by the
                            relevant statute (the PES).

                                              44
                                                                                         -Drinkwine
        3. Congressional intent can be found in:
                a. The Statute; and
                b. Legislative History
        4. Legislative History showed that the monopoly was created to:
                a. Ensure that mail reached recipients at the same time; and
                b. Subsidize low-profit postal routes.
        5. The legislative monopoly exists to ensure that postal services would be provided to
            the citizenry at large, and not to secure employment for postal workers.
        6. The court rejected the Unions’ argument that labor management provisions beyond
            the PES (in the PRA) brought employees within the zone of interest
                a. None of the provisions of the PES had any integral relationship with the
                     labor management provisions of the PRA.
xxi. Lujan v. Defenders of Wildlife (1992) p. 664
        1. Whether persons interested in viewing endangered wildlife have standing to seek
            judicial review of agency decision potentially affecting such wildlife.
                a. No.
        2. The constitutional minimum of standing:
                a. 1st “injury in fact” – an invasion of a legally protected interest which is (a)
                     concrete and particularized, and (b) “actual or imminent, not conjectural or
                     hypothetical”
                b. 2nd, a causal connection between the injury and the conduct complained of –
                     the injury has to be fairly… trace[able] to the challenged action of the
                     defendant, and not… the result [of] the independent action of some third
                     party not before the court.”
                c. 3rd, it must be “likely,” as opposed to merely “speculative” that the injury
                     will be “redressed” by a favorable decision.
        3. When the suit is one challenging the legality of government action or inaction,
            standing depends considerably upon whether the plaintiff is himself an object of the
            action.
        4. When a plaintiff’s asserted injury arises from the government’s allegedly unlawful
            regulation of someone else, much more is needed.
        5. The respondents had failed to show injury
                a. The desire to use or observe an animal species is undeniably a cognizable
                     interest for the purpose of standing.
                b. The “injury in fact” test requires more than an injury to a cognizable interest.
                     It requires that the party seeking review be himself among the injured.
        6. The affidavits discussing past visits to areas where endangered species live contained
            no facts showing how damage to the species would produce “imminent injury”.
        7. The Supreme Court rejected the “ecosystem nexus” argument; the Court also rejected
            the “animal nexus” and the “vocational nexus” approaches.
        8. Respondents failed to demonstrate redressability.
                a. Suits challenging, not specifically identifiable Government violations of law
                     (acts), but the particular programs agencies establish to carry out their legal
                     obligations are rarely, if ever, appropriate for federal-court jurisdiction.
                b. The agencies funding the projects were not parties.
                c. The agencies generally supply only a fraction of the funding for foreign
                     projects.
        9. The court rejected the respondent’s argument based on “citizen suit” provisions of
            the ESA.
                a. This “private attorney-general” theory is subject to Article III limitations.
                b. A plaintiff raising only a generally available grievance about government
                     does not state an Article III case or controversy.
                c. Vindicating the public interest is the function of Congress and the Chief
                     Executive.
                                         45
                                                                                                -Drinkwine
     xxii. National Credit Union Administration v. First National Bank
              1. A court “should not inquire whether there has been a congressional intent to benefit
                  the would-be plaintiff… The proper inquiry is simply whether the interest sought to
                  be protected … is arguably within the zone of interest sough to be protected by the
                  statute.”
              2. “First [a court should] discern the interests ‘arguable… to be protected’… [and] then
                  inquire whether the plaintiff’s interests affected by the agency action in question are
                  among them.”
    xxiii. Branton v. FCC (1993) p. 673
              1. Whether a radio listener who had been offended by foul language on the radio had
                  standing to challenge the FCC’s decision that the indecency was not actionable.
                      a. Fuck No!
              2. The petitioner has not suffered injury in fact.
                      a. While the offense to one’s sensibilities may indeed constitute an injury, a
                           discrete, past injury cannot establish the standing of a complaintant who
                           seeks neither damages nor other relief for that harm, but instead requests the
                           imposition of a sanction in the hope of influencing another’s future behavior.
                      b. The possibility that the petitioner will again “some day” be exposed to a
                           broadcast indecency lacks the imminence required.
                      c. UCC – Office of Communications is not controlling.
                                 i. Continuing v. isolated Events
                                ii. Immediacy lacking in Branton.
              3. The petitioner has not shown causation or redressability.
                      a. The petitioner is not subject to the FCC decision.
                      b. The Court can have no confidence that the FCC’s failure to impose a
                           sanction upon NPR will lead it or any other broadcaster to injure the
                           petitioner in the future.
G. Finality
    xxiv. Mandated by APA 704
             1. Judicial review can be heard of final decisions only
     xxv. What is excluded?
             1. ALJ decisions that have not been reviewed vy the agency, or after a certain amount
                  of time before it becomes final.
             2. Partial decisions maed before the overall final decisions is mad – ie. evidentiary
                  rulings made by an ALJ, before the agency has reviewed.
    xxvi. How do you know if the decision is a “final decision”?
             1. Look to the statute of agency rules to see if there is possibility to go further.
                       a. If there is a mandatory appeal given by statute, or rule, the original decision
                          may not be final.
H. Primary Jurisdiction
    xxvii. Introduction
               1. When both the agency and the courts have jurisdiction, who should hear the case
                   first- the courts or the agency?
               2. This doctrine is discretionary – the courts will decide either way unless Congress
                   mandates through statute.
               3. Relation to the Exhaustion Doctrine see below
                        a. Primary jurisdiction applies when concurrent jurisdiction exists between
                             the courts and the administrative agency.
                        b. The exhaustion rule applies to when exclusive jurisdiction exists in the
                             agency, and the courts have only appellate, as opposed to original
                             jurisdiction to review the agency’s decision.
   xxviii. Background
               1. Texas & Pac. Ry. v. Abilene Cotton Oil Co. (1907) p. 680

                                               46
                                                                                         -Drinkwine
                  a. Unifomity / Consistentcy
         2. Great N. Ry. v. Merchants Elev. Co (1922) p. 680
                  a. Issues of facts and discretion
                  b. Not if purely a legal issue
                  c. Uniformity
                  d. Expertise
         3. United States v. Western Pacific Railroad Co. (1956) p. 681
                  a. Intricate Facts
                  b. Expertise
         4. Nader v. Allegheny Airlines (1976) p. 682
                  a. Uniformity
                  b. Expertise
                  c. Even though primary jurisdiction should rest in the Agency, the common law
                      claim can be heard concurrently in Art. III courts.
xxix. Farmers Insurance Exchange v. Superior Court (1992) p. 677
         1. Whether this judicial action should be stayed under the doctrine of “primary
             jurisdiction” pending administrative action.
                  a. Yes.
         2. The Primary Jurisdiction and Exhaustion Doctrines Compared.
                  a. Both are essentially doctrines of comity between courts and agencies
                  b. Exhaustion applies where a claim is cognizable in the first instance by an
                      administrative agency alone: judicial interference is withheld until the
                      administrative process has run its course.
                  c. Primary Jurisdiction, applies where a claim is originally cognizable in the
                      courts (and in an agency), and comes into play whenever enforcement of the
                      claim requires the resolution of issers which, under a regulatory scheme,
                      have been placed within special competence of an agency.
         3. Policy Considerations Underlying the Primary Jurisdiction and Exhaustion Doctrines
                  a. The exhaustion doctrine is principally grounded on concerns favoring
                      administrative autonomy and judicial efficiency
                  b. The primary jurisdiction doctrine enhances court decision making and
                      efficiency by allowing courts to take advantage of administrative expertise,
                      and it helps assure uniform application of regulatory laws.
         4. A court is not prohibited from exercising its discretion under the primary jurisdiction
             doctrine merely because “alternative” or “cumulative” administrative and civil
             remedies are made available to a plaintiff.
         5. If the legislature establishes a scheme under which a court is prohibited from
             exercising discretion under the doctrine od primary jurisdiction, a court must honor
             the legislative scheme, and may not decide to adjudicate a suit.
         6. The insurance Commissioner had at his disposal a “pervasive and self-contained
             system of administrative procedure” to deal with the precise questions.
         7. There was good reason to require that these administrative procedures be invoked.
         8. Consideration of judicial economy, and concerns for uniformity strongly militate in
             favor of a stay to await action by the Insurance Commissioner.
         9. A court would benefit immensely, and uniformity of decisions would be greatly
             enhanced, by having an expert administrative analysis available.
 xxx. Far East Conference v. United States (1952) p. 688
         1. Whether, in a suit brought by the United States to enjoin a dual-rate system enforced
             in concert by steamship carriers engaged in foreign trade, a District Court can pass on
             the merits of the complaint before the Federal Maritime Board has passed upon the
             question.
                  a. No. The agency must first hear the complaint.


                                          47
                                                                                             -Drinkwine
              2. In cases raising issues of fact not within the conventional experience of judges or
                 cases requiring the exercise of administrative discretion, agencies created by
                 Congress for regulating the subject matter should not be passed over.
                     a. This is so even though the facts after they have been appraised by the agency
                         serve as a premise for legal consequences to be judicially defined.
              3. RATIONALE: Uniformity and Expertise
I. Exhaustion of Administrative Remedies
    xxxi. Introduction
              1. Statement of the Doctrine:
                       a. Where relief is available from an administrative agency, the plaintiff is
                           ordinarily required to pursue that avenue of redress before proceeding to the
                           courts; and until that recourse is exhausted, suit is premature and must be
                           dismissed.
              2. Purpose of the Doctrine
                       a. Agency Expertise and Discretion
                       b. Respect for Agency Autonomy
                       c. Creation of Agency Record
                       d. Judicial Economy
              3. This is a discretionary doctrine. There are exceptions where the court can choose not
                  to require exhaustion and hear the case.
              4. Relation to the Primary Jurisdiction Doctrine
                       a. Primary jurisdiction applies when concurrent jurisdiction exists between
                           the courts and the administrative agency.
                       b. The exhaustion rule applies to when exclusive jurisdiction exists in the
                           agency, and the courts have only appellate, as opposed to original
                           jurisdiction to review the agency’s decision.
   xxxii. Portela-Gonzalez v. Secretary of the Navy (1997) p. 693
              1. Whether a party who has available to her an administrative appeal may instead have
                  the claim heard in the federal court instead of before the agency?
                       a. No.
              2. Although exhaustion of administrative remedies is absolutely required if explicitly
                  mandated by Congress, courts have more latitude in dealing with exhaustion
                  questions when Congress has remained silent.
              3. The exhaustion doctrine ordinarily “serves the twin purposes of protecting
                  administrative agency authority and promoting judicial efficiency”
              4. Discretionary Exceptions:
                       a. When unreasonable or indefinite delay threatens unduly to prejudice the
                           subsequent bringing of judicial action
                       b. When “a particular plaintiff may suffer irreparable harm if unable to secure
                           immediate judicial consideration of his claim.
                       c. When the agency cannot grant meaningful redress.
                       d. When there exists clear, objectively verifiable indicia of administrative
                           talent.
                       e. When resort to the administrative process would be futile.
              5. The Court rejected Portela’s argument that a fourth level of review was not in fact
                  available to her.
              6. The Court rejected Portela’s argument that the court should excuse her omission
                  because another administrative appeal would have been futile because it would have
                  resulted in an automatic affirming of her dismissal.
                       a. Reliance on the exception in a given case must be anchored in demonstrable
                           reality. A pessimistic prediction or a hunch is not enough.
              7. The District Court erred in excusing exhaustion


                                             48
                                                                                                 -Drinkwine
                       a. A perceived waste of resources, in and of itself, cannot justify excusing non-
                            exhaustion of administrative remedies.
                       b. Is is generally inefficient to permit a party to seek judicial recourse without
                            first exhausting her administrative remedies. Concerns regarding efficiency
                            militate in favor of, rather than against, strict application of the exhaustion
                            doctrine.
  xxxiii. Xiao v. Barr (1992) p. 700
             1. Whether exhaustion is required when it is alleged that the agency lacks jurisdiction.
                       a. Yes.
             2. Even when an alien is not, strictly speaking, seeking to attack a final order of
                  exclusion, judicial review is precluded it the alien has failed to avail himself of all
                  administrative remedies, one of which is the exclusion hearing itself.
             3. Wang’s arguments against INS jurisdiction are not constitutionally based, but rather
                  turn on a question of whether the INA grants the INS authority over aliens entering
                  the country who do not wish to be admitted to the country. Such questions are in the
                  purview of the INS proceedings.
  xxxiv. Darby v. Cisneros (1993) p. 707
             1. Whether the federal courts have the authority to require that a plaintiff exhaust
                  available administrative remedies before seeking judicial review under the APA
                  where neither the statute nor agency rules specifically mandate exhaustion as a
                  prerequisite to judicial review.
                       a. No.
             2. The judicial doctrine of exhaustion is conceptually distinct from the doctrine of
                  finality.
             3. §704, by its terms, has limited the availability of the doctrine of exhaustion of
                  administrative remedies to that which the statute or rule clearly mandates.
             4. The last sentence of §704 refer explicitly to “any form of reconsideration” and “ an
                  appeal to superior agency authority.” If courts were able to impose additional
                  exhaustion requirements beyond those provided by Congress or the agency, the last
                  sentence of §704 would make no sense. §704 explicitly requires exhaustion of all
                  intra-agency appeals mandated; it would be inconsistent with the lain language of
                  §704 for courts to require litigans to exhaust optional appeals as well.\
             5. Where the APA applies, an appeal to “superior agency authority” is a prerequisite to
                  judicial review only when expressly required by statue or when an agency rule
                  requires appeal before review and the administrative action is made inoperative
                  pending that review.
J. Ripeness
   xxxv. Introduction
             1. Ripeness requires a court to evaluate both:
                     a. The fitness of the issues for judicial decision; and
                     b. The hardship to the parties of withholding court decision.
                               i. (Source: Abbott Labs v. Gardner p. 634 see above)
  xxxvi. Dietary Supplement Coalition v. Sullivan (1992) p. 714
             1. Whether the FDA’s classification of dietary supplement CoQ10 is an issue for
                 judicial review.
                     a. No.
             2. The fitness element requires that the issue be primarily legal, need no further factual
                 development, and involve a final agency action. To meet the hardship requirement, a
                 party must show that withholding judicial review would result in direct and
                 immediate hardship and would entail more than possible financial loss.
             3. Even under Abbott’s “pragmatic and flexible” approach to determining finality,
                 specific product seizures do not amount to final agency action regarding any use of
                 CoQ10.

                                               49
                                                                                                  -Drinkwine
             4. Classification of a product as “food” involves “complex chemical and
                  pharmacological considerations and determination of technical and scientific
                  questions.” In such cases, a district court should decline to review anything less than
                  a final administrative determination on the classification of the product.
             5. In light of the court’s rejection of DSC’s finality argument, DSC failed to show
                  sufficient hardship.
  xxxvii. Reno v. Catholic Social Services (1993) p. 719
             1. Whether individuals must apply for benefits offered under a regulation before a
                  challenge of the regulation is ripe.
                       a. Yes, when the regulation does not impose penalties for newly imposed
                           regulation but instead limit access to a benefit not automatically bestowed
                           upon the individual.
             2. Ripeness is drawn from both Art. III cases and controversy limitations on judicial
                  power and from prudential reasons for refusing to exercise jurisdiction.
             3. In some cases, the promulgation of a regulation will itself affect parties concretely
                  enough to satisfy the ripeness requirement, such as where challenged regulations
                  presented plaintiffs with the immediate dilemma of choosing between complying
                  with newly imposed, disadvantageous restrictions or risking serious penalties for
                  violation.
             4. A challenge to another regulation, the impact of which could not “be said to be felt
                  immediately” would not be ripe, since “no irremediably adverse consequences
                  flowed from requiring a later challenge.”
             5. The regulations challenged here fail on the latter side of the line. The impose no
                  penalties for violating any newly imposed restriction, but limit access to a benefit
                  created by the Reform Act but not automatically bestowed on eligible aliens.
             6. Justice O’Connor, concurring;
                       a. A suit challenging a benefit-conferring rule is not necessarily unripe jus
                           because the plaintiff has not yet applied for the benefit.
                       b. At the very least, where the challenge is purely legal, and where the plaintiff
                           will suffer hardship if he cannot raise his challenge until later, a justifiable,
                           anticipatory challenge to the rule may well be ripe in the prudential sense.
K. Substantial Evidence
  xxxviii. Introduction
               1. Scope of the Review – Substantial Evidence Rule
                       a. The substantial evidence standard gives to the reasonableness of what the
                          agency did on the basis of the evidence before it. It is thus an appellate
                          standard.
                       b. A decision may be supported by substantial evidence even though it could be
                          refuted by other evidence that was not presented to the decision maker.
               2. What function does the court play? Appellate or de novo?
                       a. General rule is that the court is an appellate body, and will only look at the
                          record before it.
                       b. The Court usually gives deference to the agency’s decision
                       c. In some instances the court will hear de novo, and will hear new facts.
                       d. If the court finds against the agency on a substantial evidence case, it will
                          normally remand to the agency for a re-hearing. If it rules differently than
                          the agency on a de novo case, the court does not have to remand it to the
                          agency.
               3. Substantial Evidence Standard:
                       a. Applies to formal rulemaking/adjudication or if a statute provides for a
                          hearing on the record – APA
                       b. Does not apply if there is no record or if statute provides for de novo review.
               4. Arbitrary / Capricious

                                                50
                                                                                            -Drinkwine
                    a. Applies in no agency record
                    b. Applies in all other circumstances as well.
xxxix. APA §706
          1. The reviewing court shall decide all relevant questions of law, interpret constitutional
              and statutory provisions, and determine the meaning or applicability of the terms of
              an agency action. The reviewing court shall –
                   a. (1) compel agency action unlawfully withheld or unreasonably delayed; and
                   b. (2) hold unlawful and set aside agency actions, findings, and conclusions
                       found to be –
                            i. (A) arbitrary, capricious, an abuse of discretion, or otherwise not in
                               accordance with law;
                           ii. (B) contrary to constitutional right, power, privilege, or immunity;
                          iii. (C) in excess of statutory jurisdiction, authority, or limitations, or
                               short of statutory right;
                          iv. (D) without observance of procedure required by law;
                           v. (E) unsupported by substantial evidence in a case subject to sections
                               556 and 557 of this title or otherwise reviewed on the record of an
                               agency having provided by statute; or
                          vi. (F) unwarranted by the facts to the extent that the facts are subject to
                               trial de novo by the reviewing courts.
   xl. Universal Camera v. NLRB (1951) p. 749
          1. What is the standard of review used by Courts of Appeals to review orders of the
              NLRB?
                   a. The substantial evidence standard.
          2. The Wagner Act provided “The findings of the Board as to the facts, if supported by
              evidence, shall be conclusive.”
          3. “Evidence” means “substantial evidence” which is more than a mere scintilla. It
              means such relevant evidence as a reasonable mind might accept as adequate to
              support a conclusion.
                   a. Citing Consol. Edison.
          4. The evidence must be “substantial” after the reviewing court takes into account
              “whatever in the record detracts from its weight.”
          5. The requirements of the Wagner Act are met when the reviewing court could find in
              the record evidence which, when viewed in isolation, substantiated the NLRB’s
              findings.
          6. While the NLRB findings are entitled to respect, they must nonetheless be set aside
              when the recode before the court of appeals clearly precludes the NLRB’s decision
              from being justified by a fair estimate of the worth of the testimony of witnesses or
              its informed judgment on maters within its special competence or both.
  xli. American Textile Manufacturers Inst. V. Donovan (1981) p. 759
          1. Whether OSHA’s cost-benefit analysis was supported by substantial evidence.
                   a. Yes.
          2. § 6(f) of the OSHA provides that “The determinations of the Secretary shall be
              conclusive if supported by substantial evidence in the record considered as a whole.”
          3. The Court has previously held that substantial evidence was “such relevant evidence
              as a reasonable mind might accept as adequate to support a conclusion.” Citing
              Universal Camera (above). The reviewing court must take into consideration
              contradictory evidence. Id. The possibility of drawing tow inconsistent conclusions
              from the evidence does not prevent an administrative agency’s findings from being
              supported by substantial evidence.
          4. The statute placed the review responsibility in the Court of Appeals and the Supreme
              Court will therefore only intervene when the substantial evidence standard appears to
              have been misapprehended or grossly misapplied by the court below. Citing
              Universal Camera (above).
                                           51
                                                                                                  -Drinkwine
               5. §6(b)(5) of the Act requires the Secretary to promulgate toxic material and harmful
                   physical agent standards on the basis of best available evidence.
               6. Because OSHA could not obtain the more detailed confidential industry data in
                   thought essential, the Court concluded that the agency acted responsibly in adoption
                   the HT estimate.
               7. OSHA concluded that the cost compliance with the Cotton Dust Standard was
                   “economically feasible,” relying on RTI’s investigation. Even if OSHA’s estimate
                   were understated, the Court observed that RTI found that a standard more than four
                   times as costly was economically feasible.
     xlii. Citizens to Preserve Overton Park v. Volpe (1971) p. 766
               1. Which standard of review applies in a situation where the enabling statute is silent?
                        a. The Court found that the arbitrary/capricious standard in §706 APA was
                            applicable because neither of the two standards proposed by the petitioners
                            was applicable.
               2. Review under the substantial evidence test is authorized only when the agency
                   actions is taken pursuant to a rulemaking provision of the APA or when the agency
                   actions is based on a public adjudicatory hearing.
               3. De novo review is normally allowed only if an outside statute provides for it. De
                   novo reviews also is authorized under the APA –
                        a. (1) when the action is adjudicatory in nature and the agency fact-finding
                            procedures were inadequate; or
                        b. (2) when there may be a need for independent judicial fact-finding when
                            issues that were not before the agency were raised in a proceeding to enforce
                            non-adjudicatory agency action.
               4. The Secretary’s action is still reviewable under §706.
                        a. The Court must first examine whether the Secretary acted within the scope of
                            his authority.
                        b. The Court must determine whether the Secretary’s choice was “arbitrary,
                            capricious, an abuse of discretion, or otherwise not in accordance with law.”
                            The court must consider whether the decision was based on a consideration
                            of the relevant factors and whether there has been clear error of judgment.
                            But, the court is not entitled to substitute its judgment for that of the agency.
    xliii. Summary I.
               1. Substantial Evidence Standard:
                        a. Applies to formal rulemaking/adjudication or if a statute provides for a
                            hearing on the record.
                        b. Does no apply if there is no agency record or the statute provides for de novo
                            review.
               2. Arbitrary / Capricious Standard:
                        a. Applies if there is no agency record to review (no hearing).
                        b. Applies in all other situations as well.
    xliv. Summary II
               1. Substantial Evidence Standard:
                        a. The agency’s decision must be supported by substantial evidence standard
                            found in the record only.
               2. Arbitrary Capricious Standard.
                        a. The agency’s decision must not be arbitrary / capricious based on the
                            evidence before the decision-maker which might not included evidence not
                            “on the record” (ie. not known by the parties).
L. Chevron Doctrine
    xlv. Introduction
             1. Chevron Deference
                     a. Rules

                                                52
                                                                                             -Drinkwine
                    b. Regulations
                    c. Adjudications
                    d. Opinion Letters if statute is ambiguous
                    e. Agency interpretation of a statutes resulting from a “relatively formal
                       administrative procedure” intended by Congress to have the force of law.
          2. Skidmore Deference
                   a. Any other interpretation not based on a “relatively formal procedure”
                       intended by Congress to have the force of law.
                   b. Opinion letters where statute is unambiguous
                   c. Litigation positions
                   d. Policy Statements
                   e. Agency Manuals
                   f. Enforcement Guidelines
          3. Chevron v. Skidmore
                   a. In the Skidmore deference, the agency must prove that the standard used was
                       the most persuasive interpretation available. The agency must prove how it
                       chose this interpretation over another. Whereas in the Chevron deference,
                       the court will allow the agency to choose any interpretation as long as it is
                       reasonable, even if it is not the best interpretation to take.
 xlvi. Chevron v. Natural Resources Defense Council (1984) p. 796
          1. What deference do courts owe to agency interpretation of a statute it administers?
                   a. Chevron deference
          2. A court reviewing agency construction of the statute which it administers is
              confronted with two questions.
                   a. (1) Whether Congress has directly spoken to the precise question at issue. If
                       the intent of Congress is cleat, that is the end of the matter.
                   b. (2) If the court determines Congress has not directly addressed the precise
                       question at issue, the court does not simply impose its own construction on
                       the statute. If the statute is silent or ambiguous, the question for the court is
                       whether the agency’s answer is based on a permissible construction of the
                       statute.
          3. “The power of an administrative agency to administer a congressionally created…
              program necessarily requires the formulation of policy and the making of rules to fill
              an gap left, implicitly or explicitly, by Congress.” If Congress has explicitly left a
              gap for the agency to fill, there is an express delegation of authority.
          4. Such legislative regulations are given controlling weight unless they are
              arbitrary/capricious.
          5. The legislative delegation to n agency may be implicit rather than explicit.
          6. Considerable weight should be accorded to an executive department’s construction of
              a statutory scheme it is entrusted to administer. If this choice represents a reasonable
              accommodation of conflicting policies that were committed to the agency’s care by
              the statute, the court should not disturb it.
          7. The AC misconceived the nature of its role in reviewing the regulation.
          8. The Court agreed with the AC that Congress did not have a specific intention on the
              applicability of the bubble concept in these cases and concluded that the EPA’s use
              of that concept here was a reasonable policy choice for the agency to make.
xlvii. Christensen v. Harris (2000) p. 804
          1. Whether agency opinion letters are entitled to Chevron deference.
                   a. No. They are entitled to Skidmore deference.
          2. The Department of Labor took the position that the opinion letter was entitled to
              Chevron deference.
          3. Interpretation contained in the opinion letters are entitled to Skidmore respect, but
              only to the extent that those interpretations have the “power to persuade”.

                                           53
                                                                                             -Drinkwine
           4. The United States asserts that the agency’s opinion letter should be given deference
               under Auer (an agency’s interpretation of its own regulation is entitled to deference).
           5. The regulation in this case, however, is not ambiguous – it is plainly permissive.
xlviii. United States v. Mead Corporation (2002) p. Supplement
           1. Whether a tariff classification ruling by the United States Custom Service deserves
               Chevron deference.
                    a. No, it is entitled to Skidmore deference.
           2. When Congress has “explicitly left a gap for an agency to fill, there is an express
               delegation of authority,” and any ensuing regulation is binding in the courts unless
               procedurally defective, arbitrary or capricious in substance, or manifestly contrary to
               the statute.
           3. “Considerable weight should be accorded to an executive department’s construction
               of a statutory scheme that it is entrusted to administer…”
           4. The delegation may also be implicit. A reviewing court has no business rejecting an
               agency’s exercise of its generally conferred authority to resolve a particular statutory
               ambiguity simply because the agency’s chosen resolution seems unwise, but is
               obliged to accept the agency’s position if Congress has not previously spoken to the
               point at issue and the agency’s interpretation is reasonable.
           5. An indicator of delegation meriting Chevron treatment is express congressional
               authorizations to engage in rulemaking or adjudication that produces regulations or
               rulings for which deference is claimed.
           6. Congress contemplates administrative action with the effect of law when it provides
               for a relatively formal administrative procedure.
           7. The fact that the tariff classification here was not a product of such formal process
               does not alone bar Chevron deference.
           8. But, there are ample reasons to deny Chevron deference here.
                    a. The statute gives no indication that Congress meant to delegate authority to
                        Customs to issue classification rulings with the force of law.
                    b. Classification rulings are best treated like “interpretations contained in policy
                        statements, agency manuals, and enforcement guidelines” as in Christensen
                        (above).
           9. There is room at least to raise a Skidmore claim here, where the regulatory scheme is
               highly detailed, and Customs can bring the benefit of specialized experience to bear
               on the subtle questions in this case. A classification ruling in this situation may
               therefore at least seek a respect proportional to its “power to persuade.”
                    a. Mead changes the Chevron doctrine from “permissible” to “reasonable”
                        interpretations of the law. We don’t know if there is really a difference.
 xlix. Mead – Scalia Dissent
           1. Removal of discretion – What was previously a general presumption of authority in
               agencies to resolve ambiguity in the statutes they have been authorized to enforce has
               been charged to a presumption of no such authority, which must be overcome by
               affirmative legislative intent to the contrary.
           2. Under Mead, only when agencies act through “adjudication[,] notice-and-comment
               rulemaking, or …some other [procedure] indicati[ng] comparable congressional
               intent [whatever that means]” is Chevron deference applicable.
           3. The practicable effects of the new rule:
                    a. Protracted confusion because the test is “wonderfully imprecise”
                    b. Increase in informal rulemaking because rules are afforded Chevron
                        deference.
                    c. Ossification of large partitions of our statutory law.
           4. The principles central to the majority opinion have no antecedent in U.S.
               jurisprudence.
           5. Scalia would adhere to the original formulation of Chevron. Absent some clear
               textual indication to the contrary, “Congress, when it left ambiguity in a statute meant
                                            54
                                                                                           -Drinkwine
           for implementation by an agency, understood that the ambiguity would be resolved
           by the agency to possess whatever degree of discretion the ambiguity allows.”
l. Rust v. Sullivan (1991) p. 816
      1. Whether agency regulations representing a sharp break with long-standing agency
           practices are entitled to Chevron deference if the represent a “plausible construction
           of… the statute.”
                a. Yes.
      2. The plain language of the statute is ambiguous; §1008 does not speak directly to the
           issues of counseling referral, advocacy, or program integrity.
      3. Under Chevron, if a statute is “silent or ambiguous… the question for the court is
           whether the agency’s answer is based on a permissible construction of the statute.”
      4. The Secretary’s construction of Title X may not be disturbed as an abuse of the
           discretion if it reflects a plausible construction of the plain language of the statute and
           does not otherwise conflict with Congress’ expressed intent.
      5. “The court need not conclude that the agency construction was the only one it
           permissibly could have adopted….’
      6. The broad language of Title X plainly allows the Secretary’s construction of the
           statute.
      7. The legislative history is also ambiguous.
      8. When the Court finds that the legislative history is ambiguous, the Court customarily
           defers to the expertise of the agency.
      9. Petitioners argue that the regulations are entitled to little or no deference because they
           “reverse a long-standing agency policy…”
      10. In Chevron, this Court rejected the argument that an agency’s interpretation “is not
           entitled to deference because it represents a sharp break with prior interpretations” of
           the statute in question. A revised interpretation deserves deference because “[a]n
           initial agency interpretation is not instantly carved in stone” and “the agency… must
           consider varying interpretations and the wisdom of its policy on a continuing basis.”
      11. The Court found that the Secretary amply justified his change of interpretation with a
           “reasoned analysis”.




                                        55

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:43
posted:6/25/2012
language:English
pages:55