Administrative Law Prof Blog

ACUS news

Because I suspect these folks will have an influence on the future of administrative procedure, here are the latest appointments to the Administrative Conference of the United States:

• Fred Fielding (Morgan, Lewis & Bockius; White House Counsel for Presidents Reagan and G.W. Bush)—Senior Fellow.
• David Vladeck (FTC; formerly at Georgetown)—Senior Fellow.
• John D. Graham (Dean, Public and Environmental Affairs, Indiana; former OIRA Administrator)—Public Member.
• Beth S. Noveck (New York Law School; formerly Director, White House Open Government Initiative)—Public Member.
• Nina E. Olsen (IRS)—Liaison Member.

For more details, see the press release. EMM

Policy: RegBlog on ACUS on online rulemaking

From Penn's RegBlog, "ACUS Committee Discusses Online Access to Rulemaking". Opening paragraph:

As part of an ongoing effort to improve federal agency rulemaking, the Administrative Conference of the United States’s (ACUS) Committee on Rulemaking held a public meeting last Wednesday to consider recommendations for enhancing online efforts to engage the public in the rulemaking process.

This is government in the 21st Century. EMM

New administrative law article

From the University of Washington's Current Index to Legal Periodicals:

• Kinney, Eleanor D. Administrative law protections in coverage expansions for consumers under health reform. 7 J. Health & Biomed. L. 33-65 (2011). [H]|[L]|[W]

EMM

Interesting jurisdiction case

On his Customs Law blog, Larry Friedmann (Barnes/Richardson, Chicago) reviews an interesting jurisdictional muddle and potential Catch-22 in "Importer Identity Theft":

The underlying facts are that someone imported food from Sri Lanka. I say “someone,” because it seems pretty well established that the importer was not the plaintiff in this case. Rather, someone who is regularly in the business of importing food from Sri Lanka stole the identity of the plaintiff and made entry using its information. As a result, when the FDA decided that it wanted the merchandise redelivered to Customs and Border Protection, CBP inquired with the plaintiff and eventually sent the Notice to Redelivery to [the plaintiff], who promptly said “It’s not our stuff.” When Customs did not receive the merchandise, it eventually made a claim for liquidated damages from [the plaintiff], the importer shown on the entry papers.

At some point, the plaintiff paid the liquidated damages to avoid administrative sanctions and filed a suit in the Court of Federal Claims to secure a refund. What the plaintiff did not do was file a protest with Customs and Border Protection challenging the redelivery notice (or the liquidated damages for that matter).

The Court of Federal Claims looked at the case and said, “This seems to be a case for the Court of International Trade” and promptly sent the case to New York [the location of the CIT]. .... [T]he Department of Justice argued that plaintiff should have filed a protest, which would either have resulted in a favorable decision by the agency or would have given the CIT a denied protest to review .... According to this argument, if a plaintiff could have protested and a protest would not have been manifestly inadequate as a means of getting the desired relied, a protest is a prerequisite to getting into the CIT. [See below on the wording of the jurisdictional statute, plus exhaustion of administrative remedies.]

This left [the plaintiff] with having to argue that it could not file a protest and that a protest would have been manifestly inadequate. On the first point, [the plaintiff] argued that it could not file a protest because it was not the importer. Rather, it was the victim of identity theft and should not be required to act like the importer to challenge the redelivery demand. Unfortunately, the law involved says that a protest may be filed by the importer “shown on the entry papers.” [The plaintiff] was the importer shown on the entry papers. The Court also found that [the plaintiff] had notice of the demand within the 180 day period to file a protest. Thus, the CIT found it could have filed a protest.

Which leads to the question of whether a protest would have been manifestly inadequate. This is usually the case where the outcome of the protest is a foregone conclusion and a mere formality. That was not the case here. According to the Court, the plaintiff could have used the protest mechanism to inform Customs and Border Protection that it was not the legitimate importer and did not have possession of the goods. Given that information, CBP may have granted the protest, meaning the process was not a mere formality.

The CIT, therefore, held that because the plaintiff could have filed a protest, it ... [did] not have jurisdiction.

All of this raises two questions .... First, since the CIT has now determined that it actually lacks jurisdiction, is there a legitimate argument that it should go back to the Court of Federal Claims? That court only transferred the case based on its understanding that the CIT had jurisdiction. I think this is a reasonable question.

Second, I wonder about the proper construction of the protest statute. The full language is that a protest may be filed by “the importers or consignees shown on the entry papers.” Would someone familiar with English grammar and the next antecedent rule please tell me how we are supposed to know whether the phrase “shown on the entry papers” modifies both “importers” and “consignees” or just “consignees.”

It appears that the plaintiff was familiar enough with the administrative process involved to have filed a protest, so asking it to use the administrative remedy is not grossly unjust. But what if we were dealing with a naive victim of identify theft?

(Mr. Friedmann also says "I have recently decided that purely procedural decisions are of interest to only a small segment of readers of this blog. Also, procedural cases generally do not turn on broadly applicable principles of law (which make for good posts)." I hope he continues his cogent commentary on procedural cases that turn on broadly applicable principles of administrative law. Please?) EMM

Sneaky changes in administrative procedure

On RegBlog, Sam Saylor (Penn) has posted "Debt Ceiling Legislation Also Speaks to Administrative Law".

Despite all the attention the congressional debate over the debt ceiling received this summer, a section of the Budget Control Act of 2011 -- the controversial August 1st law that raised the ceiling at the last moment -- also contains a little-known but interesting administrative procedure quirk. It exempts certain Department of Education policies from a procedure known as negotiated rulemaking.

Title V of the legislation purports to save the government money by removing the interest rate subsidy for all federal government originated or guaranteed graduate-level student loans ....
    
Interestingly, the final section of Title V expressly exempts implementation of these student loan changes from negotiated rulemaking. The exemption is from a mandate, imposed on the Department of Education under 1998 amendments to the Higher Education Act, that ordinarily requires rules about federal student loans to be established using negotiated rulemaking.
    
When an agency follows the negotiated rulemaking process -- or what is also known as "reg neg" -- its proposed rule is developed through negotiation with affected parties, after which the agency proceeds with the ordinary notice-and-comment process. Reg neg procedures are highly touted as a more efficient and less adversarial way to craft administrative rules because representatives of interested groups are invited to negotiate with each other before the agency announces its proposal.
    
Research by Professor Cary Coglianese at the Penn Program on Regulation has shown that reg neg procedures consume considerable time and resources and do not reduce litigation over administrative rulemaking. "In the debt ceiling legislation, Congress appears to have implicitly acknowledged negotiated rulemaking's disadvantages," he said.

Go to the post for links to many of the documents and terms to which it refers. Two general lessons here.

First, changes in administrative procedures can be subtle, inserted into legislation in a manner that requires very careful reading. You can see with this example that it doesn't take many words to make a large change in how an agency does business.

Second, one cannot always determine the reason for a change from its language. Pace Prof. Coglianese (for whom I have the utmost respect and admiration), it is not impossible that Congress had reasons other than efficiency for dropping negotiated rulemaking in this case. One of the problems with negotiated rulemaking is that it facilitates agency capture. It leads to politically determined rules rather than rules written by the "agency experts". The interest groups, even all of those involved, may not reflect the common good. (Who selects which interest groups should be involved in the process?) And, once you come to rely on the interest groups to draft your rules, you don't need agency experts any more. (So, if this is the reason for judicial deference, is judicial deference justified any more? Are the courts deferring to interest groups rather than presumably interest-neutral agency experts? Should we set Chevron aside for rules created by negotiated rulemaking?)

I suspect we will never know the internal process in Congress that led to this change in agency procedure. Prof. Coglianese may be right. EMM

New administrative law articles

From the University of Washington's Current Index to Legal Periodicals:

• Barnett, Kent. The Consumer Financial Protection Bureau's appointment with trouble. 60 Am. U. L. Rev. 1459-1488 (2011). [H]|[L]|[W]
• Dumas, Graham Frederick. A comparative analysis of the U.S. Freedom of Information Act and current Russian information-freedom legislation. 3 J. Eurasian L. 237-254 (2010). [H]|[L]|[W]
• Givati, Yehonatan and Matthew C. Stephenson. Judicial deference to inconsistent agency statutory interpretations. 40 J. Legal Stud. 85-113 (2011). [H]|[L]|[W]
• Reiss, Dorit Rubinstein. Account me in: agencies in quest of accountability. 19 J.L. & Pol'y 611-681 (2011). [H]|[L]|[W]
• VanWagner, Adam B. Note. Seeking a clearer picture: assessing the appropriate regulatory framework for broadband video distribution. (Comcast Corp. v. FCC, 600 F.3d 642, 2010.) 79 Fordham L. Rev. 2909-2966 (2011). [H]|[L]|[W]
• Symposium. Presidential Influence Over Administrative Action. Articles by Heidi Kitrosser, Harold J. Krent, Nina A. Mendelson, Robert V. Percival, Neomi Rao and Aaron J. Saiger. 79 Fordham L. Rev. 2395-2615 (2011). [H]|[L]|[W]
  • Kitrosser, Heidi. Scientific integrity: the perils and promise of White House administration. 79 Fordham L. Rev. 2395-2424 (2011). [H]|[L]|[W]
  • Krent, Harold J. Federal power, non-federal actors: the ramifications of Free Enterprise Fund. 79 Fordham L. Rev. 2425-2454 (2011). [H]|[L]|[W]
  • Mendelson, Nina A. Another word on the President's statutory authority over agency action. 79 Fordham L. Rev. 2455-2485 (2011). [H]|[L]|[W]
  • Percival, Robert V. Who's in charge? Does the President have directive authority over agency regulatory decisions? 79 Fordham L. Rev. 2487-2540 (2011). [H]|[L]|[W]
  • Rao, Neomi. A modest proposal: abolishing agency independence Free Enterprise Fund v. PCAOB. 79 Fordham L. Rev. 2541-2575 (2011). [H]|[L]|[W]
  • Saiger, Aaron J. Obama's "czars" for domestic policy and the law of the White House staff. 79 Fordham L. Rev. 2577-2615 (2011). [H]|[L]|[W]

EMM

New article on judicial deference to DoD

New on SSRN, "Leveling the Deference Playing Field" by Kathryn Kovacs (Rutgers—Camden). Abstract:

Judicial deference to federal agency expertise is appropriate. What is not appropriate is the judicial tendency to give the military more deference than other agencies not only in cases that directly implicate military expertise, but also in administrative law cases raising constitutional, environmental, and employment issues. This article argues that the military should receive no greater deference than other agencies under the Administrative Procedure Act. The APA established a single standard of judicial review for all agencies. Recent empirical studies have confirmed, however, what the case law has long revealed: that courts often apply different standards of review to different agencies, and specifically a “super-deference” standard to the military. This article demonstrates that the APA’s exception for “military authority exercised in the field in time of war,” interpreted correctly, insulates core military functions from judicial review, thus removing any basis for giving the military heightened deference as a matter of course. That exception accommodates separation of powers concerns raised by judicial interference with the President’s authority as Commander in Chief, and it removes concern about courts second-guessing military expertise in particular by making actions that directly implicate that expertise unreviewable.

EMM

Using practical problems to teach administrative law

From Dave Owen (Maine) on the Environmental Law Prof Blog: "I wish I could have taken that class...":

Keith Hirokawa (Albany) just posted a short article [on SSRN] describing an innovative land use course he teaches.  He structures his course around a hypothetical permitting process for a real parcel of land (which the students actually visit), and asks students to assume the roles of attorneys representing the multiple parties involved in the land use dispute.  It sounds like a great class, and his approach could be imitated, with some adjustment, in other locations or for environmental law courses.  The article is a quick read, and I recommend checking it out.

The article also contains a more general discussion of some of the benefits of problem-based learning.  To the list of advantages Keith provides, I'd add one more.  I've found that problems--particularly problems in which students assume adversarial roles--are wonderful mechanisms for getting students to closely read statutes and regulations.  That's an essential skill for environmental lawyers, but it isn't easy to develop through traditional caselaw-based teaching.  But when students know they'll be required to present an argument to their classmates, and that those classmates will be challenging their arguments, they seem far more eager to act like real lawyers and pore over the details of statutory and regulatory language.

Prof. Hirokawa's article is "Teaching from the Dirt: Best Practices and Land Use Law Pedagogy". Abstract:

The inspired and compelling article by Patricia Salkin and John Nolon, 'Practically Grounded', suggests that a course in land use law may be well-suited for cutting-edge pedagogical practices. This essay addresses what the authors of Practically Grounded have identified as a present deficiency in legal education: many, perhaps most, future land use lawyers graduate from law school without having looked at a parcel of real property from the perspective of a practicing attorney. This essay explores the opportunities presented in a course that incorporates 'teaching from the dirt' and discusses how such a course can help to connect the dots that lie between legal education and the practice of law. Teaching from the dirt involves using land and real world controversies to facilitate student engagement with the facts and laws that govern land use decision making. Students in such a class are required to perform like lawyers. To accomplish these goals, this course compels students to participate in a simulated regulatory process concerning the development of an actual parcel of vacant property, to engage the controversy on behalf of a client, to navigate the legal process, and to envision how the law applies to the land and influences the outcome of the process.

The Nolon and Salkin article can be found here. The insights of Professors Hirokawa and Owen apply in many administrative law teaching settings. EMM

Theory: Rulemaking and separation of powers

Rulemaking links to an opinion of the Florida Supreme Court announced yesterday in "Florida Supreme Court Holds Governor’s Suspension of Rulemaking Exceeds Authority". I've glanced through it, and it may be peculiar to Florida and less useful elsewhere. The key argument of the Court's opinion is that separation of powers means that the Legislature, not the Governor, controls the authority of agencies to make rules. I think what the Court is saying is that if the Legislature by statute tells an agency to make rules implementing a statute, then the Governor does not have the power to stop that rulemaking. The dissents argue for a unitary executive—all delegated rulemaking authority is part of the executive power and runs through the Governor. In the Federal Constitution this debate would revolve around what it means that the President must "faithfully execute" the law. Unlike many state constitutions, the U.S. Constitution has no explicit separation of powers provision. I tend to the belief that separation of powers is a bogus argument, because as a practical matter there is a large overlap among the functions of the three branches of government. But that's just me.

I'll be looking for analysis from people smarter than me. EMM

Can you get attorneys' fees for administrative hearings?

In California, yes, if they are prerequisite to filing suit. Jennifer E. Faught (Myers Nave, Oakland CA) reviews a recent California Court of Appeal case on The Public Blawg in "Administrative Hearings Are 'Actions' Subject to an Award of Attorneys Fees".

As a prerequisite to filing their ... lawsuit, the plaintiffs had appealed [the agency]’s grant of a conditional use permit ....  The court held that these administrative proceedings were useful and necessary to the litigation essentially because the plaintiffs could not have brought their lawsuit without first exhausting their administrative remedies, and that “[i]n fact, there can be no public interest litigation without first filing an administrative proceeding.”

Previous case law established that an administrative proceeding is an “action” that could justify an award of attorneys’ fees ... when it is “useful and necessary” to the litigation.  After [this case], the “useful and necessary” test will always be met when administrative proceedings are a prerequisite to filing a lawsuit, making it easier for plaintiffs to recover larger awards of attorneys’ fees under [California]’s private attorney general statute.

What's it like in your jurisdictions? EMM

Vested rights doctrine

Patty Salkin (Albany) reviews a Vermont case talking about the "vested rights doctrine" on her Law of the Land blog in "VT Supreme Court Holds No Vested Rights to Change in the Law After Application Filed". See her post for the facts and such, but here is the explanation:

The court noted that the vested rights doctrine followed is the minority rule which permits applicants to gain a vested right in the governing laws and regulations in existence when a complete permit application is filed.  This means that the applicant has a vested right to the laws in effect at the time of its original permit application.  The only way applicant would be able to take advantage [of] the new change in law would be to restart the ... permit process from the beginning. The Court rejected the argument that the submission of an application for reconsideration is a “vesting event” entitling the applicant to all law in effect at that time.

It's sort of like the law of the case doctrine. If you started the administrative process under a certain set of laws and regulations, you have the right to ignore subsequent changes until the process is completed. But you don't get a mulligan if the law changes after the process is completed. And note that this is a minority rule, so your mileage may vary. EMM

New administrative law articles

From the University of Washington's Current Index to Legal Periodicals:

• Amar, Akhil Reed. The President, the Cabinet, and independent agencies. 5 U. St. Thomas J.L. & Pub. Pol'y. 36-61 (2010). [H]|[L]|[W]
• Bradley, Keith. The design of agency interactions. 111 Colum. L. Rev. 745-794 (2011). [H]|[L]|[W]

EMM

Exhausting administrative remedies?

On the Insurance Class Actions Insider blog, Wystan Ackerman (Robinson & Cole, Hartford) writes about a recent Fourth Circuit case in "Title Insurance Class Action: Fourth Circuit Affirms Decertification and Dismissal Based on Failure to Exhaust Administrative Remedies". He has a point that goes beyond insurance and class actions:

[S]ometimes it’s obvious that there is an administrative remedy and primary jurisdiction argument. .... In other cases, there is a potential argument based on an administrative remedy, but the potentially applicable statute or regulation is obscure or rarely invoked. In some instances, the [regulated party] may prefer to litigate than potentially throw the issue into a regulatory proceeding. What is important here is for [regulated parties] and their counsel to remember to explore this issue whenever it might apply, and recognize that the argument might exist in circumstances where, at first blush, you would not expect it to be a viable argument.

EMM

Policy: Using rules to prevent fragmentation of federal law

Out of the Consumer Finance Protection Bureau comes what seems to me to be a novel use of federal regulation: To prevent federal law from being fragmented by parallel state enforcement. This concept is discussed by Christopher J. Willis (Ballard Spahr, Atlanta) on the CFPB Monitor blog in "Will CFPB's State Official Notification Rules Protect Federal Law?"

One of the four sets of Interim Final Rules released by the CFPB on July 28 was its “State Official Notification Rules,” which set forth the obligations of state attorneys general to notify the CFPB when the AGs bring actions to enforce the provisions of the Dodd-Frank Act. ...

[T]he real question, I think, is whether the CFPB will use the oversight powers it has over state AG actions to prevent the state-by-state fragmentation of federal law. It’s no secret that one of the primary impacts of Dodd-Frank is to greatly increase the importance of state law and force national banks and federal thrifts to comply with a patchwork of differing laws. But even beyond this, by giving state AGs the right to enforce Title X of Dodd-Frank and the CFPB’s regulations, Congress has raised the specter that even supposedly-uniform federal laws will be interpreted and applied differently in different states.

The release accompanying the State Official Notification Rules states that the CFPB’s objective is to maintain “consistent application of the [Dodd-Frank] Act.”  The rules give the CFPB the authority to promote consistency by intervening in cases and even removing them to federal court, but one of the most interesting things to watch as the CFPB begins to operate is whether it will meaningfully police state AG enforcement actions to achieve this goal.

Interesting. EMM

New administrative law article

From the University of Washington's Current Index to Legal Periodicals:

• Armiger, Jonathan. Note. Judicial review of public utility commissions. (N. Ind. Pub. Serv. Co. v. U.S. Steel Corp., 907 N.E.2d 1012, 2009.) 86 Ind. L.J. 1163-1183 (2011). [H]|[L]|[W]

EMM

Commentary on New Jersey making ALJ decision final

New Jersey Law Journal has published two op-eds on the bill we discussed July 6th in "Judicial review in New Jersey: Pending bill would make some ALJ decisions directly appealable to courts".

James A. Kozachek, Give ALJs Some Teeth: Make Decisions in Contested Cases Final, July 8, 2011.  Opening: "When individuals or businesses are charged with violating one of the thousands of regulations enforced by the state, they can challenge that decision in an independent and separate court system in the Office of Administrative Law." Closing: "I ask the state Legislature and Gov. Chris Christie to support A-2722 to ensure that government plays by the rules and that businesses have the chance to defend themselves before an independent decision-maker when faced with alleged regulatory violations and what often amount to business-destroying assessments and penalties."

Paul P. Josephson and Susan A. Feeney, ALJ Final Decisions Are Here Already, And Don't Create a Fourth Branch, August 3, 2011. Opening:

The Law Journal 's distinguished Editorial Board missed the mark with its jeremiad, "No De Facto Fourth Branch," on June 17.

In it, the board opposes A-2722/S-2666, which would make certain adjudications by administrative law judges final, eliminating the ability of state agencies to overturn ALJ decisions they do not like. The State Bar Association strongly endorses this measure, approved by the Assembly 77 to 0. The Senate version now awaits a vote.

The editorial worries that giving ALJs final authority in a handful of defined categories will create a de facto fourth branch of government and offend our strong executive model of governance. This is not true.

Closing: "In short, ALJ finality will provide a greater, faster and more efficient measure of due process to litigants. In the hierarchy of constitutional values, due process is a core value that should trump executive prerogative in virtually every case."

Compare what North Carolina has done. EMM

New administrative law articles

From the University of Washington's Current Index to Legal Periodicals:

• Mitchell, S. David. Impeding reentry: agency and judicial obstacles to longer halfway house placements. 16 Mich. J. Race & L. 235-320 (2011). [H]|[L]|[W]
• Tosdal, Sara B. Note. Preserving dignity in due process. 62 Hastings L.J. 1003-1036 (2011). [H]|[L]|[W]
• Tsvasman, Rimma. Note. No more excuses: a case for the IRS's full compliance with the Administrative Procedure Act. 76 Brook. L. Rev. 837-866 (2011). [H]|[L]|[W]

EMM