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Administrative Law
University of South Carolina School of Law
Boyd, Marie C.

 
Administrative Law
Prof. Boyd – Spring 2015
 
APA §§ are in the Appendix starting on page 705
TWEN
 
 
1.      Introduction: What is Administrative Law? The History of Administrative Agencies and the Supreme Court
a.       Administrative Agencies and Our System of Government
                                                  i.      What defines a Department? President’s cabinet secretaries are the heads of them and are therefore political appointees which serve at the pleasure of the president. They are a part of the executive branch.
                                                ii.      There are also many independent agencies. What makes them independent? These agencies have a group of commissioners versus having one head. The parties split the commissioner positions and they have terms so can’t be fired by president.
                                              iii.      ICC v. Cincinnati New Orleans and Texas Pacific Railways:
1.      The ICC came into being from the Interstate Commerce Act (note that all acts creating agencies are called governing or enabling statutes). This case concerned rate setting with the railways.
2.      Congress created the ICC to correct and control abuses. They regulated the rates in order to do so. However, the issue is whether the commission was vested with the power and duty to fix rates.
3.      What would be the alternative to having an agency regulate rates? Congress would have to do it themselves (takes a lot of time). Someone still has to enforce the regulation though.
4.      What are other options for Congress instead of Congress doing the work? The government could do nothing and let the market regulate itself. This second option of doing nothing is often argued about. It can be detrimental to the country. Doing nothing is very cheap.
5.      They decided to create an agency here. What are the benefits of delegating the work? You have experts and you also retain oversight and can rewrite the statute and guidelines. It may be good for the industry itself because there is one place everyone can go.
6.      What role does the judiciary have once an agency is created? The Supreme Court determines if the agency is acting within the authority granted to it. They read it very literally and limited. Since the legislation did not expressly grant authority to set rates, the Court held they did not have the authority to set rates. Power needs to be given in an express, specific, and clear manner. The reason for this is because at that time, regulation was unheard of. So they read it very narrowly.
                                              iv.      Pennsylvania v. West Virginia
1.      The dissent is the key from this case. They did not allow WV to restrict sales outside the state. The question is whether they should have power to do so.
2.      Brandeis Dissent is important because of the issue of expertise and who is most competent to regulate. The Court is not competent to make this type of decision because of the necessity of obtaining a lot of information. They would need experts etc.
3.      The point of this case is that deciding one case doesn’t help in overall regulation because it can’t control everyone.
                                                v.      NBC v. United States
1.      NBC challenged the FCC’s power to regulate in the licensing of broadcast stations.
2.      The industry is radio. The FCC was given broad authority to deal with the larger and more effective use of radio in the public interest. The three criteria given to the FCC in licensing were public interest, convenience, or necessity. They wanted to control radio because there wasn’t enough room for everyone so they passed the Communications Act of 1934. Why was it so broad? Legislation doesn’t know what needs to be done so they let the agency have broad power in order to fix the problem.
3.      There is no telling how this stuff will evolve so they leave it broad.
4.      NBC claims that they are going outside their authority given in the statute. However, the court says that the FCC does have the authority. They were given much more broad authority than merely technical and engineering impediments.
5.      What will the court be looking for in whether the agency has the power to act? They will be looking for some sort of explicit restriction most likely.
6.      The importance of this case is that there has become a change among the Supreme Court in how it treats agencies. Now they look for express restrictions as opposed to express authority.
7.      Why have they changed so much? They have New Deal justices on there now. There also have been agencies around for awhile now and so they are more accepted.
                                              vi.      US v. SW Cable Company
1.      This case is supposed to represent the high water mark of the Supreme Court’s tolerance for and deference to administrative agencies.
2.      In this case, the cable company is alleging that the FCC lacked authority to regulate CATV.
3.      The FCC says that because the statute says it has “regulatory power over all forms of electrical communication: whether by telephone, telegraph, cable, or radio.” The cable company says it is different because it isn’t distributed over airwaves, it is distributed over wire.
4.      The cable company says that they had previously sought and failed to get such legislation. The court says they merely wanted clarification.
5.      Second, the cable company says that that section does not independently give authority but merely says there might be another section conferring such authority. The court does not buy this argument.
6.      The court also won’t look at the act so restrictively because Congress could not have contemplated cable tv at the time.
7.      Finally, the court says it should be construed broadly because of the need for regulation and there is no limiting language so they have no reason to limit it.
8.      Criticism of this case is that we should leave it to Congress to explicitly take away or grant such authority.
9.      holding  =  future directive as to how to read enabling statutes: courts look to overall goals/purposes of enabling statute itself
10.  Difference from ICC →  shift to “presumption” that agency has authority to regulate unless expressly limited
                                            vii.      FDA v. Brown and Williamson Tobacco Corp.
1.      This case involves the regulation of tobacco.
2.      The FDA now is trying to assert authority over tobacco although it has disavowed such authority repeatedly. They claimed nicotine was a drug and thus gave them authority to regulate it.
3.      The FDA said that once they had power over it, they could ban it and restrict sale etc.
4.      The court did not buy the FDA’s argument. The tobacco corporation says that Congress has repeatedly said no and the actual act did not grant the authority. Additionally, the FDA never previously claimed they had such authority.
5.      Supreme Court held FDA lacked the authority to regulate tobacco.
6.      What is the difference between this and previous cases? They seem to be saying if it isn’t in the act then you don’t have it. However, it is somewhat different since it is tobacco. The most important thing is that the Supreme Court is talking about the importance of economic factors and forces. Tobacco is important in America, so we must be careful in allowing agency regulation of such.
7.      What is the court looking for from Congress? Congress wouldn’t “delegate a decision of such economic and political significance to an agency in so cryptic a fashion.” The court has shifted somewhat in that when it is an important matter to America, they expect Congress to grant direct authority. The reason for the holding is that tobacco is so important.
b.      Adjudication and Rulemaking: the main two types of agency action.
                                                  i.      They both can be in two forms: informal and formal
                                                ii.      There can also be Hybrid forms.
                                              iii.      Londoner v. City and County of Denver
1.      The landowner is claiming denial of due process for an assessment of taxes due to street paving.
2.      The city is supposed to allow notice and an opportunity to be heard. Once council decided to pave they assessed taxes to property which abutted to it. They failed to give notice and opportunity to be hea

ons. Legislation by Congress is also presumed that they don’t get due process rights.   
2.      Chapter 3: Rule Making
a.       Introduction to Rule Making
1.      Where does the authority come from for the agency to make rules?
2.      What procedures does APA require?
3.      What are the policy arguments for allowing broad rulemaking?
                                                ii.      §551(4) defines a rule: agency statement of general applicability and it has future effect to implement the laws already in place
                                              iii.      §553 governs informal rule making. It requires general notice and comment. §553(b) gives the notice requirements. The agency publishes notice in the Federal Register.  
                                              iv.      National Petroleum Refiner’s Association v. FTC:
1.      Can the FTC engage in rulemaking which would help to define what are unfair trade practices.
2.      The FTC is trying to comply with their goals of preventing unfair methods of competition in commerce and unfair or deceptive acts or practices in commerce.
3.      The commission passed a regulation requiring posting octane ratings. They said this is per se unfair trade practice.
4.      There were two trade associations and 34 gas companies contesting this.
5.      The DC Circuit said we will look to the statute and the legislative intent.
6.      The plaintiffs say that it only gives them power for adjudication. The statute only talks about accomplishing their goals. The plaintiff says they only can adjudicate, not promulgate rules.
7.      FTC says that §5(b) does not have any limiting language saying adjudication alone is their power. We are not limited. The court agrees with the FTC.
8.      The FTC says that §6(g) provides for procedural rulemaking. However, it also will be construed to allow substantive rule making as well.
9.      The Courts wants the agency to be able to do its work. The court spends a lot of time talking about the benefits of rulemaking.
a.       The court says rulemaking is more fair than a case by case adjudication. They don’t want to single people out. They also don’t want to reward bad actors.
b.      It serves the purpose of shortening and simplifying the adjudicative process and clarifying the law in advance.
c.       It conserves resources by not making them do a lot of adjudications.
10.  Due to these policy reasons, the court will view rulemaking authority in a very broad way. They don’t need explicit authority.
11.  A possible problem is to use adjudication and then do rulemaking. You also have a lot more invested in an adjudication which may create more facts etc.
12.  When it comes to rulemaking, the courts will look to the enabling statute. However, they will not need to find explicit language because they will broadly construe it.
13.  This is the highwater mark of agency authority. Courts were most deferential to agencies in this time period.
14.  A key question in these cases is who should be the gap filler. Should the agency or Congress which defines more what is an unfair trade practice.
15.  There is some concern later over the agencies having too much power and being too aggressive. How do the courts rein them in?
16.  Some state legislatures have now included in the statute saying that the agency does not have authority unless we give it to them.