Administrative Law Outline
Shavers Fall 2010
APA Definitions § 551
I. Rulemaking
a. Generally
i. Rule
1. General Applicability
2. Policy Orientation
3. Future Effect
4. Not Adjudication
ii. Authority
1. Determined by enabling/organic act.
b. §553 – Informal Rulemaking – (Notice & Comment)
i. Basic Requirements:
1. Published Notice of the proposed rulemaking.
2. Opportunity for public Comment, and after consideration of the comments,
3. Publication of the final rule together with a concise general statement of the rule’s basis and purpose.
ii. Notice
1. Requires publication of either text of proposed rule or a description of the subjects or issues involved in the rulemaking.
a. To prevent publishing one rule and then promulgating another – courts require that the rules that are ultimately adopted be the logical outgrowth of the original proposal, or the final rule may not materially alter the proposal. Cure: New notice & comment period.
b. Chocolate Mfg: Did not receive adequate notice that elimination of flavored milk would be considered in rulemaking on WIC foods.
iii. Meaningful Opportunity to Submit Comments
1. 553(c) – Requirement that interested parties be allowed to submit comments = requires a “meaningful” opportunity to participate.
2. Courts have required that agencies provide notice of any date or studies on which they base their decision or rely.
a. See: United States v. Nova Scotia Food Prods; Nat’l Black Media Coalition v. FCC.
3. Nothing in the APA explicitly requires this, however courts have held that for the opportunity to participate to be meaningful, interested parties must have an opportunity to comment.
iv. Ex Parte Communications
1. Definition – §551(14) – communication not on the record with no reasonable prior notice to all parties.
Is not technically barred by the APA in informal rulemaking (is barred in formal rulemaking and formal adjudication).
a. Some courts hold that ex parte communications are not allowed and some hold that they are not barred.
i. Policy: Barred because they potentially threaten the ability of other interested parties to participate meaningfully in the rulemaking process.
ii. Some courts suggest that agencies should consider only the comments presented through notice & comment. That way, if judicial review is used in the future the court can look at the record to determine the agency’s basis. Other courts have banned ex parte communications to rulemakings that involve competing claims to a valuable privilege.
iii. Remedy: If ex parte problems do arise, it is recommended that any documents that have been provided/exchanged and a summary of oral communications should be placed on the record.
iv. HBO v. FCC: It would be intolerable if there were one administrative record for the public and one for the “insiders”. Even if the substance is put on the record, there was still no chance for adversarial debate.
b. Intergovernmental ex parte contacts: The President (as chief executive) has the right to receive information from and give his input to administrative officials regarding pending rulemaking.
i. Congress members may also represent the interests of their constituents through ex parte so long as they don’t represent extraneous matters to pressure agency members.
ii. Sierra Club: EPA did not exceed authority when it communicated with Senate and President after notice and comment period ended.
v. Prejudgment in rulemaking
1. Decision makers in rulemakings may be disqualified if it is shown through clear and convincing evidence that the decision maker has prejudged the issues to such a great extent that he or she has an unalterably closed mind – and thus will not consider the comments from the comment period in the rulemaking process.
vi. Concise General Statement
1. §553(c) requires an agency to explain their rules with a concise general statement of their basis and purpose. The statement must respond to substantial issues raised by the comments and state the agency’s view on major issues of law and policy.
a. Info and data on which agency relied.
b. Statutory authority that allowed rule to be issued by agency.
c. Place rule fits into existing regulatory structure.
d. Circumstances that necessitated rule.
e. Regulatory history surrounding rule.
f. Purpose/goal of rule.
i. Nova Scotia: Commissioner should have addressed whether commercial feasibility was considered and/or if other interests prevailed.
ii. California Hotel: Order invalid b/c unsupported by adequate statement; did not fulfill any functions of effective statement.
1. Dissent: Requires too much for a “concise and general statement”
vii. Publication of Final Rules
1. Final rules must be published in Federal Register within 30 days prior to effective date. If not properly published, the rule is ineffective as to any party without actual notice. §552
viii. Hybrid Rulemaking
1. Some enabling acts require procedures in addition to those imposed in §553. Those can include: discovery, cross exam of experts, and additional comment periods.
2. Courts may not impose additional procedures on agencies other than those listed in the APA or in the enabling statutes. See: Vermont Yankee.
a. This calls into question the ban on ex parte communications in rulemakings when there is an absence of a ban in the APA.
c. §§556 & 557 – Formal Rulemaking
i. When is this required?
1. Formal, adjudicatory rulemaking is required when the agency’s enabling act requires rules to be made “on the record after opportunity for an agency hearing”
a. Courts generally do not rule in favor of formal rulemaking on review because of the cumbersome process. The process is rarely used.
b. Triggering language must show clear intent.
i. Florida East Coast: “after hearing” not the same as “on the record after opportunity for hearing”; formal rulemaking not required.
ii. Take into account past agency practice.
2. The process is conducted like a trial with an ALJ or agency head presiding.
a. Ex Parte Communications – banned.
b. Parties may make their case by oral or documentary evidence, and may cross-examine opposing witnesses.
c. The record produced at the hearing is the exclusive record for the decision and a detailed decision with findings of fact and conclusion of law is required.
d. Negotiated Rulemaking – Negotiated Rulemaking Act
i. Agencies may formulate proposed rules through a process of formal negotiations among interested parties.
ii. If
reinstate terminated employee based on mitigating factors or progressive discipline. Conduct which compromised the security rendered progressive discipline inapplicable.
B. Sufficient evidence/arbitrary and capricious standard to be used by other reviewing courts.
1. Haeffner: Sufficient evidence on record to justify termination for check cashing and illegally delivering controlled substance.
vi. Deference
A. Hard Look Doctrine
1. Applies to issues of fact finding in rulemaking.
2. Courts may technically substitute it’s judgment for the agency’s.
a. Congress sets scope of review within Constitutional boundaries.
b. Thus Congress can allow anything from De Novo review to no review at all – assuming the decision is Constitutional.
3. De Novo – You start over at the trial court – Agency findings can be used as evidence, but there is no deference to the agency – Used more at the STATE level.
4. Independent Judgment on the Evidence – Decided on agency record but no deference to the agency.
5. Clearly Erroneous – Definite & firm conviction that a mistake has been made on the facts and policy. (i.e. Reviewing a verdict by a trial judge without a jury).
6. Substantial Evidence – Could reasonable person have made the same conclusion? (Again – the same standard of review for reviewing a jury verdict or taking a case from the jury)
a. Should a jury get more or less deference than an agency?
7. Courts defer to agency’s policy-making role, but looks hard to make sure the agency considered all the relevant factors in making the policy.
8. Now it is basically a reasonableness determination.
B. Chevron Doctrine
1. Step Zero: Rule must be promulgated pursuant to authority Congress has delegated to the official.
2. Step 1: Determine whether the statute’s plain terms directly address the precise question at issue. If the statute is clear, stop here, the court and the agency must follow the unambiguously expressed will of the legislature.
3. Step 2: If the statute is silent or ambiguous, courts are obligated to defer to the agency’s interpretation as long as it is reasonable choice or permissible construction. (Not arbitrary or capricious)
a. Vermont Yankee: EPA was free to choose one way of evaluating effect of uranium fuel cycle over another, court could not overturn.
b. Auer: Secretary of Labor’s salary basis test for determining employee’s exempt status was permissible reading of the statute.
c. Brand X: FCC’s construction of cable service as information rather than telecommunication was reasonable; supported by reasoning that customer is always connected and transmission is necessary component of internet.
d. Long Island Care: Dept of Labor could create minimum wage exemption for domestic employees or companionship services employed by a third party. Act explicitly left gaps and instructed agency to fill them. (Generally if Congress leaves a gap, the court considers it should be left for the agency to fill the gap based on their expertise in the matter)
e. Reasoning used by agency in rulemaking subject to review by courts (State Farm). Rule will be set aside if:
