Administrative Law Prof Blog

McNeil on Perceptions of Fairness in Agency Adjudications

Chris McNeil (Capital) has posted "Perceptions of Fairness in Agency Adjudications: Applying Lind & Tyler's Theories of Procedural Justice to State Executive-Branch Adjudications" on bepress.  Abstract:

Under the U.S. Constitution, before the government may adversely affect liberty or property interests, the interest-holder is entitled to an administrative hearing or a trial. When fact-finding is transferred from the judicial branch by the legislative branch and is given to the executive branch, executive agencies are given the power to use tools that traditionally are wielded not by governors or presidents, but by judges. The result is an administrative fact-finding hearing, presided over by an administrative law judge (ALJ). This hearing uses someone who, on the one hand, is part of the executive branch, but on the other hand acts like a judge in the judicial branch. The executive-branch adjudicator tends to create the impression that because he or she is part of the executive branch of government, any decision rendered by the ALJ will be biased in favor of the executive branch, because the judge is not independent, and is part of the executive agency that brought the charges.

Applying principles of "procedural justice" examined first by Thibaut and Walker in the 1970s, and then by Lind and Tyler in the 1980s, this paper examines perceptions of fairness in ALJ adjudications. It uses results from field studies of participant perceptions of fairness in agency adjudication. This is a doctoral dissertation, supported by a grant from the National Science Foundation. The paper will report on the results of a national survey of litigants, defense lawyers, and ALJs, probing whether these stakeholders believe the hearings they participated in were fair.

EMM

CMS Ducks Arbitration Controversy, Congress Finally Acts

In 2003, the Centers for Medicare & Medicaid Services (CMS) was asked to address the validity of pre-dispute binding arbitration clauses in admission contracts of federally funded nursing homes.  The problem with these agreements is that they allow nursing homes that abuse, neglect and even kill their residents to avoid the public scrutiny of the courts and channel these claims into secret arbitration proceedings before industry-friendly arbitrators. CMS ducked the issue in a letter. http://www.cms.hhs.gov/SurveyCertificationGenInfo/downloads/SCLetter03-10.pdf

A bill has been introduced in Congress that would remedy this situation.  The Fairness in Nursing Home Arbitration Act of 2008, introduced in the House by Representative Linda Sanchez (D-California) and in the Senate by Mel Martinez (R-Florida), would amend the Federal Arbitration Act of 1925 to make pre-dispute binding arbitration agreements in nursing home admission contracts unenforceable.
http://thomas.loc.gov/cgi-bin/query/z?c110:H.R.6126:

Hearings were held last month.  The hearing before the House Judiciary Committee can be viewed on-line. http://judiciary.house.gov/hearings.aspx?ID=207

LT

Indian Casinos, Standing, The Nondelegation Doctrine, and Chevron - All in One Case!

I really enjoyed reading the new Fifth Circuit opinion in Texas v. United States, __ F.3d __, 2007 WL 2340781 (5th Cir. Aug 17, 2007); it is rich with issues relevant for several different areas of law.  The majority opinion provides a thought-provoking discussion of whether a state should have standing to sue when the requisite "injury in fact" is merely being dragged into an unwanted administrative proceeding with an Indian Tribe, and the fact that the state has less bargaining power as a result of losing the right to give ultimatums (i.e., walking away from negotiations with tribes). The majority (Chief Justice Edith Jones writing) says that both of these harms provide a sufficient basis for standing. This seemed like a somewhat new development in the rules for standing.

Although the decision nowhere cites Massachusetts v. EPA, it seems to follow that case's approach of "special solicitude for states" (at least regarding standing to sue the federal government).  The majority opinion in Texas v. U,S. seems to incorporate a lot of arguments about Eleventh Amendment state sovereignty creating unique circumstances where courts could find an injury-in-fact that would not apply to private parties (or tribes, for that matter).  In that sense, it is a victory for federalists. 

The Chevron analysis in the case is also interesting, because it turns on whether regulatory "gaps" created by courts invalidating certain portions of the enabling statutes can imply a legitimate delegation (warranting Chevron-style judicial deference). The majority says no, and I think the Court got this right. The Chevron doctrine is more properly about agency interpretations of statutory verbiage (a linguistic issue, really), not about agencies' implied authority. This is the main issue the dissenting opinion attacks, citing contrary decisions from two or three other Circuit courts - indicating there is a growing split of circuit authority on this nuance of Chevron (hence it would be a fertile subject for academic commentary and an eventual Supreme Court decision).  I also liked how the Chevron issue here was interwoven with delegation concerns, nicely illustrating a point Cass Sunstein made a few years ago that Chevron really is a "nondelegation canon."

This is also one of the somewhat-rare examples of an agency losing on Chevron step 2.  The low threshold for states to meet (reasonableness), and the long-standing precedent for judicial deference to agency interpretations, make it unusual for a court to rule against the agency at that stage in the analysis.  In this case, the Court held that the state lost on both Chevron step 1 and step 2.

I confess I also liked it that the casinos lost; gaming presents serious public policy concerns (there are overt economic benefits for the states, but also troubling externalities that affect the local area), and it seems to be an area where states should decide what is best for their citizenry. 

-Dru Stevenson

No Govt Benefits for Posthumously Conceived Child

The New Hampshire Supreme Court recently ruled (on Aug 9) that children born via artificial insemination after the father's death (from banked sperm) cannot collect Social Security Survivors' Benefits. (Read the Court's Opinion).  At first blush, it seems a little odd for a state supreme court to be deciding a question of eligibility for a federal benefits program, but the court traced the jurisdictional authority this way:

[U]nder the Social Security Act (the "Act"), an individual who is the "child" of an insured wage earner and is dependent on the insured at the time of his death is entitled to child’s insurance benefits. 42 U.S.C. § 402(d)(1). In determining "child" status, the Act instructs the Commissioner [to] . . . apply such law as would be applied in determining the devolution of intestate personal property by the courts of the State in which such insured individual was domiciled at the time of his death. Applicants who according to such law would have the same status relative to taking intestate personal property as a child of parent shall be deemed such. Thus, if Christine may inherit from Mr. Khabbaz as his surviving issue under New Hampshire intestacy law, she is considered to be the "child" of Mr. Khabbaz under the Act and is therefore entitled to child’s insurance benefits. The Commissioner of the Social Security Administration (commissioner) denied Christine’s application for survivor’s benefits based upon an interpretation of RSA 561:1, our state’s intestacy distribution statute. After a hearing, an administrative law judge upheld the commissioner’s decision, and the Appeals Council of the Social Security Administration subsequently affirmed. Christine then appealed the commissioner’s decision to the federal district court. Recognizing that this case raises an unresolved question of New Hampshire law, the district court certified the question to us.

It appears, however, that the petitioner would have (could still?) obtain a different result by moving a modest distance across the border into Massachusetts.  Perhaps the lawyer should have proposed this option to the client, as a means of ensuring a more likely victory in the case?

A troubling aspect of this case: the Court's bizarre use of a DICTIONARY as authority...

Eng argues that her daughter is a "surviving issue" within the meaning of the statute. However, the plain meaning of the word "surviving" is "remaining alive or in existence." Webster’s Third New International Dictionary 2303 (unabridged ed. 2002). In order to remain alive or in existence after her father passed away, Eng would necessarily have to have been "alive" or "in existence" at the time of his death. She was not. She was conceived more than a year after his death. It follows, therefore, that neither she nor any posthumously conceived child is a "surviving issue" within the plain meaning of the statute.

Even apart from the tacit assumption about the "plain meaning rule" for determining the meaning of statutes, it seems strange to use a dictionary here, and even stranger to use it in the way the Court does.  Linguists scoff at courts using dictionaries, insisting that dictionaries are merely descriptive (and imperfect at that), and courts are misusing them as something prescriptive (controlling how the word shall be understood).  It does seem to turn the non-lawyer editors at Merriam-Websters into a type of super-Supreme Court.  There is also the internal inconsistency of saying we should go by the "plain meaning" of the statute, and then referring to a reference book to divine the answer.  If the meaning is plain, why the need to look it up?  That seems like a contradiction.

More disturbing, however, is the fact that the Court engages in a bit of statutory construction on the Webster's dictionary definition itself, holding that another word in the explanatory sentence, "remain," means existence prior to the death of the one who is survived.  Strangely, the Court felt no need to cite the dictionary for the definition of "remain," but engaged in some armchair linguistics (or amateur philology). How can a Court be so quick and confident about the meaning of "remain," but not about "survive"? Are courts qualified to engage in legal-styled interpretive exercises of non-legal texts, like the dictionary?  I don't get it.

-Dru Stevenson

Who Has the Most Influence on the Agency?

Arguably, the low-level managers have more effect on what the agency does and how it treats the constituent population than the high-level appointees, even though Admin law courses usually focus on the top personnel.  This will not be terrible surprising to practitioners who have experience with multiple offices of the same agency, of course.  Yesterday, at an event sponsored by the Partnership for Public Service, Univ. of Illinois-Chicago professor James Thompson explained that "front-line managers" have perhaps the most influence over day-to-day operations of the agency, and therefore should receive a heftier dose of leadership training, etc. This article summarizes the points well, mentioning specific agencies and their approach to training supervisors and managers.

-Dru Stevenson

The Status of FOIA

The Dept. of Justice recently submitted/published its second annual Report on FOIA compliance by federal agencies (warning - this is not for the faint of heart - it's 118 pages of mostly "bureaucratic milestones" and such).  Those interested in FOIA as a research area or for classroom teaching may appreciate the numerous charts and graphs about the number of FOIA requests, the FOIA backlog at different major agencies, etc.

The report has plenty of critics who claim - with some basis - that it whitewashes an serious, ongoing problem.  This article from the Federal Times includes interesting quotes from a number of former agency officials and other FOIA experts who gave interviews delineating problems with the DOJ's report, and with the current state of FOIA affairs generally.  The backlog problem is apparently quite severe, and while the report lauds the major agencies for their administrative steps to address the problem, many of the FOIA requests themselves still continue to go unanswered indefinitely.  This has the attention of Congress - a significant FOIA reform movement seems to be afoot:

In March, the House overwhelmingly passed sweeping legislation (H.R. 1309) to reform the FOIA system despite the Bush administration's contention the bill would impose substantial administrative and financial burdens on agencies. Similar legislation (S. 849) awaits action on the Senate floor, but Sen. Jon Kyle, R-Ariz., has placed a hold on the bill because of the Justice Department's objections.

I confess I have not studied the reform bills yet, but I would like to see more differentiation between FOIA requests by non-profit groups as opposed to those being used for commercial and semi-commercial purposes.  When I worked at the Connecticut AG's Office, for example, we would receive FOIA requests from local litigators who wanted us to compile hundreds - or thousands - of motions and briefs from previous cases, merely to study them in hopes of finding patterns that would betray some overarching strategy about when the government lawyers would seek summary judgment and when they would push for a trial.  The information could then be sold to other firms that litigated regularly against the AG's Office.  It's not that I think the information should be kept secret, but I see a difference between this and the FOIA requests we used to submit when I was a Legal Aid lawyer and we were genuinely trying to improve state welfare services, etc.  If the former type of FOIA request (by a lawyer with paying clients) create a backlog, this can prevent the second type of FOIA requests (which seem more meritorious to me) from being answered. It would be nice if the agencies at least had the explicit freedom to create a two-track FOIA process, one for NGO's and citizen groups, and another for the regulated industry and commercial interests, with the latter backlog not affecting the former.

-Dru Stevenson

Abusing the Agency: "Underwear for the Undersecretary"

This column from the Washington Post describes the YouTube video campaign by anti-regulatory activists over a new regulation by the Dept. of Energy - the reg apparently makes affordable washing machines (under $900) too wimpy to get clothes clean.  In protest, the video encourages viewers to send their dirty underwear to the Undersecretary of Energy (just to make a statement; there is no promise that the Undersecretary is going to clean them for you)

From the article:

"Send your underwear to the undersecretary'' urges the actress in the Competitive Enterprise Institute's stinging 66-second anti-regulatory video posted on YouTube, a free video-sharing site that is a subsidiary of Google. The video blames a 2001 Energy Department rule for an energy-efficiency standard that it says has made new models of washing machines more expensive while getting laundry less clean.

The article concludes by saying that the office of "Undersecretary" Dennis R. Spurgeon has not yet received any underwear. I'm a little confused about whether he is the right recipient. This agency org chart does portray Spurgeon as the Undersecretary of Energy and puts the "Assistant Secretary for Energy Efficiency" beneath him.  But his main govt. bio page dubs him the "Assistant Secretary for Nuclear Energy," which presumably has little to do with consumer laundry machines.

E.politics seems skeptical  about the video's effectiveness, and also understood the video to say "clean" underwear, which I must have misunderstood when I watched it.  And this review has some production suggestions to make the video more interesting.  The original article mentions attempts by regulatory agencies to use online videos to promote safety awareness, etc.

-Dru Stevenson

More on the Myth of Market Forces & Privatization

This article describes how FEMA is trying to explain 4,000 instances of outsourcing contracts it gave without getting any competitive bids.  How does privatization harness market forces & efficiency incentives without competition for the contracts? 

-Dru Stevenson

The Wisdom of Insider Crowds

OK, this article is not about a real prediction market, but it does give a glimpse into the perspectives of some people with private information the rest of us don't have about government agencies.  This is a Survey of (mostly) Federal Employees about whether taxpayers are getting a good return for their tax dollars - from the people who are handling or consuming those dollars.  I thought the article was also useful in giving a glimpse of some of the internal workings of federal agencies - even apart from the political perspectives of the agency careerists...

The answer is clear. 79% of those responding to our recent survey say "no" the taxpayer does not get a good return. Only 15% of readers responding answered "yes" to the question: "In general, do American taxpayers get a good return for their tax dollars from the federal government?" 6% answered they were "not sure."  The reasons for the negative response varied widely. The most common complaint cited by readers was pork inserted into spending bills by Congress and earmarks dictated by Congress for specific projects. The practice of earmarks is certainly leading to a decreasing confidence in government and has apparently generated rampant cynicism toward government spending and a negative view of Congress. Some readers cited problems within their agencies that were examples of how many is wasted. A few readers cited their agencies as ones where money was well spent.

As you read through the article, I liked seeing the Forest Service employee's reference to NEPA and Environmental Impact Statements (which seems to be missing from most Admin Law casebooks, but which I think is a huge factor in agency decisionmaking that students should know about).  The other most interest comment, I thought, was a VA employee's concern about money wasted on medical research.

There is also an interesting Survey of Agency Employees about the Presidential Candidates, which gives an interesting glimpse into the political preferences of agency insiders.

-Dru Stevenson

The Other Side of Appt/Removal Powers: "Burrowing In"

Most Admin Law casebooks have a section on Presidential appointment and removal powers for agency officials.  I thought this article about Rebecca McGinley offered a terrific glimpse into some of the implications and policy issues - the tension between career agency workers and political appointees, the concept of "borrowing in" (trying to switch from being a political appointee to being a career civil servant - and the problems that go with this practice), the ongoing "downward creep" of political appointments and meddling in agency affairs, and the "care and feeding" of political appointees by the agency careerists.  I might have my next Admin class read the article for background understanding of why the appointments or removals matter, and how they affect agencies internally.

On of my current research projects is about the economically salubrious effects of agency slowness (because it reduces systematic uncertainty in the markets), so I liked these quotes from the article:

"If a political and a careerist were both told to get ice," one government official said, "we'd go get a glacier, slow moving and large. They'd go get a hailstorm."

"My single biggest job is to act as a dam to keep [some policies] from getting further down the line," another careerist said of political appointees' eagerness to make policy changes.

-Dru Stevenson

OMB Addresses Recurring Problem of Data Being Lost or Stolen

This article from the Chicago Tribune describes the OMB's new internal demands on federal agencies that they curb their unnecessary use of Social Security numbers in databases, as a way to reduce the fallout when laptops and hard drives go missing.

-D.S.

Special Court of Appeals for Veteran Claims

This AP article, Judge Warns of Disability Appeal Backlog, describes the growing problems at the U.S. Court of Appeals for Veteran Claims, a special 7-judge tribunal that hears disability appeals from the VA. The number of appeals has doubled in the last two years, as the government becomes increasingly resistant to paying disability benefits for veterans. 

The crisis with veteran's benefits (and the related backlog in claims) seemed unsurprising to me given that we have ongoing armed conflicts in Iraq and Afghanistan. I was a bit surprised, however, to see the reversal rate (much higher than I remember its counterpart at the SSA having), which indicates a non-deferential review board, at the same time as an incredibly high remand rate (very deferential, and imposing delays on petitioners) - perhaps evidence of excessive bureaucratic cautiousness?  Here are the numbers:

Some two-thirds of the VA's initial decisions are typically found to be in error by the court, but rather than overturning the decision and ordering payment of benefits, the court usually sends the appeal back to the VA to take a second look, Lawrence said. Only in limited cases, after a ruling is deemed final, can a veteran appeal a ruling of the veterans court to the U.S. Court of Appeals for the Federal Circuit or the Supreme Court.

-Dru Stevenson

Article Spotlight: "Overlapping and Underlapping Jurisdiction in Administrative Law"

Professor Jacob Gersen has a terrific new article on SSRN entitled Overlapping and Underlapping Jurisdiction in Administrative Law, forthcoming in the Supreme Court Review. He addresses the (growing?) problem of Congress delegating simultaneously to multiple agencies and organs of the states, sometimes creating competing (overlapping) jurisdiction, and other times creating gaps between the areas each entity covers (underlapping jurisdiction).  Either scenario becomes particularly thorny when appellate courts must sort out which agency has authority over a particular piece of the regulatory framework, as in the Supreme Court's 2006 Gonzales case.  The problems presented by overlapping and underlapping jurisdiction touch on Chevron deference (especially Chevron Step Zero analysis), preemption analysis, etc.  The Supreme Court seems to operate with a presumption of exclusive jurisdiction, ignoring the realities of the modern regulatory (and delegatory) world.  My summary, however, cannot substitute for the author's own, as stated in his abstract:

Congress regularly enacts statutes that share government authority among many political institutions. This paper analyzes how administrative law does and should treat agency statutory interpretation in these overlapping and underlapping jurisdictional schemes. Shared jurisdiction statutes alter the incentives of administrative agencies, and can sometimes be effective tools for managing the principal-agent problems inherent in delegation. Unfortunately, judges regularly employ interpretive practices that undermine, rather than support these regimes. Particularly, in the context of Chevron doctrine - where problems of this sort arise most often - current judicial practices are in tension with the most sensible reconstruction of congressional intent.

This is a really valuable contribution to the literature, long overdue in my opinion.  I have a clumsy section in this forthcoming article about the issue of shared jurisdiction between agencies, but Gersen's article provides a much more precise analytical framework (and useful terminology) for discussing the issues involved.  This was an issue in Massachusetts v. EPA  - the EPA contended that the DOT had jurisdiction over regulating gas mileage in cars, which would overlap almost completely (in an undesirable way) with any EPA attempts to regulate car emissions of greenhouse gases.  The Supreme Court simply acknowledged the overlap and then said it should not pose any real problems for either agency - and moved on.  Gersen nicely explains in his article that this type of scenario can either lead the agencies to compete in their regulatory activities, or to shirk their responsibilities (I think the latter is a bit more likely that he does). He does out, in the section on preemption, that the Supreme Court's underlying assumption is that agencies tend toward overreaching, and Gersen questions whether this is really the natural inclination of bureaucrats.  This reminded me of a funny passage in Frank Knight's classic text Risk, Uncertainty, and Profit, where Knight talks about the conventional assumption that bureaucrats will be careless with public resources, and counters this with a a little diatribe about how bureaucrats do the exact opposite - they are overly cautious, to the point of being nearly inert and accomplishing little.

Gersen's focus is judicial treatment of shared jurisdiction between agencies (and he does a fantastic job analyzing this); I think a topic for future research or discussion would be the impact of shared regulatory jurisdiction on the regulated industry itself.  At first blush, it might seem that overlapping jurisdiction would simply compound the regulatory burden, with an arithmetic increase in rules, monitoring, enforcement, etc.  But I wonder (and alluded to this in the piece mentioned above) if there is a diminishing marginal value or cost to regulations; once the regulated party has a "compliance" department in place, awareness of the need to steer clear of various regulatory violations, etc., if the cost of each new related regulation has a decreasing or vanishing value.  And to the extent that agencies are prone to shirk - either because of laziness, or cautiousness (as Knight says), or fear of encroaching on another administrator's turf - the regulated industry gets the benefit or free ride of gaps in the regs, monitoring, and enforcement.  Comments welcome.

-Dru Stevenson

Exec Order 12,866 & 13,422

Executive Order 13,422, amending and updating the famous EO 12,866 covered in most Admin Law casebooks, now has a lengthy implementation manual from OIRA.

-Dru Stevenson

Minorities in Agency Leadership Positions

This article discusses the etiology of the government's failure to hire or recruit minority leaders for administrative agencies. 

-D.S.

DC Cir. Dismisses "Moms Against Mercury" Case

In a recent case about a federal agency refusing to regulate, the DC Circuit has sided with the agency and dismissed the claim: Moms Against Mercury v. Food & Drug Admin., __ F.3d __, 2007 WL 1094313 (D.C. Cir. April 13, 2007).  I just noticed the case because the Andrew's Litigation Reporter update for yesterday featured it.

I think this case arguably contradicts Mass v. EPA, which I have written at length about here, and that the Moms case might face reversal if the Supreme Court takes the case.  The DC Cir. never cites the Massachusetts case (are they trying to ignore it?).  I understand, of course, that the court treats this as a subject matter jurisdiction case instead of a standing case (Massachusetts was mostly a standing case), but both cases involve an agency's refusal to regulate something, and the Supreme Court held in Massachusetts that 1) there are statutory provisions of general applicability to all agencies, such as 5 U.S.C. § 555(e), that allow judicial review of agency refusals; and 2) agency's receive far less judicial deference for refusals to regulate than they would, say, for refusals to enforce or prosecute.  I can anticipate a chorus of objections that Massachusetts also involved a CAA provision for citizen suits, but the Court relied on that only for the standing issue, not for the compel-agencies-to-regulate question.  (again, I argue about this at length in my article on SSRN). In any case, if Massachusetts is superficially on point but technically distinguishable, then I would have expected the DC Cir. to mention the case in passing and distinguish it based on the CAA citizen suit provision.  Instead, they ignore it.

The case itself is about the FDA's refusal to regulate mercury dental fillings; a number of concerned citizen groups, including "Moms Against Mercury," ("Fighting for Truth and Justice for Our Children...and Yours") asked the agency to please regulate it, given the well-known health risks of mercury and the agency's clear statutory mandate for regulating dental fillings (acknowledged by the court).  The FDA said they aren't ready, so the Moms and the other groups sued. The court acknowledged that the agency had raised a standing issue, but held that it did not have to reach the question because it could dismiss the case just as easily for lack of subject matter jurisdiction. 

                                                                                                                       -Dru Stevenson

What Does the EPA Do All Day?

Not regulate greehouse gases, that's for sure. Of course, the regulated industry probably wishes they did less than they already do, but if you have ever wondered about the answer to this question, the Deputy Administrator of the agency (a.k.a. EPA Chief Operating Officer Marcus Peacock) has posted this commentary over on the Federal Times website.  Some of it is interesting...some of it is management blah blah (the type of thing Dilbert cartoons ridicule).  For academicians, I thought this snippet might be interesting:

EPA’s enforcement office routinely sends requests to the Justice Department for approval to take legal action against polluters. We found that we typically send about 10 times as many referrals to Justice in the fourth quarter of the year as in the first quarter. This was causing temporary backlogs at Justice late in the year. EPA is now balancing the workload throughout the year, and we expect it to result in faster turnaround times.

Why so many late in the year?  Ten times?  Do they procrastinate for the first three quarters of the year?  Is it a misguided attempt to spread holiday cheer?  Does the cold weather put them into a prosecuting kind of mood?  Do they realize they need to boost their yearly numbers for some reason?  I know I shouldn't overthink this, but it seemed like a strange thing to say in passing... 

I Googled Marcus Peacock and thought his Amazon Profile was more interesting than his official page at the EPA.  His dog must be busier than those prosecutors.

                                                                                                                                                                  -Dru Stevenson