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PREMIUM LEGAL RESOURCES LEGAL FORMS ASK A LAWYER

1993-94

Due Process
Matthews v. Eldridge is current standard

Issue Spotting Questions
Whether
When
What kind

Three Factors (Matthews)
the private interest affected
the risk of error in agency's decision making process
governments interest in maintining existing procedures weighed
in terms of both fiscal and administrative burdens

Whenever government action affects citizen's rights process is due

Exceptions
Waiver
Emergency
Legislative type actions (Bi-Metallic)
No facts found (legislative facts not adjudicative)
"Privilege" not in federal context but in some states
Immigration Cases
Private Action
Application for Government Benefits

Timing (When)
Case by case determination. Courts favor some type of pre-
decision process, however there are no hard rules. Usually, if
the harm can be remedied by post decision process, court will
approve (restoration of monetary benefits). If harm can't be
corrected post decision, favor pre-decision process (posting of
drunkard lists).

Mutual exclusivity requires simultaneous decision. (Licenses)

What kind
risk of error and government efficiency are key factors

Boundaries

"Notice and Opportunity to be heard" are rock bottom floor.
CEILING is Goldberg type procedure. Neutral decision maker,
confrontation and exclusive record. Trial type or evidentiary
hearing.

Statutes can add more procedure

Agency Decisions : Rule or Order

Rule APA 551(4)
the whole or part of agency statement of general or particular
applicability of future effect designed to implement, interpret,
or prescribe law or policy or describing the organization,
procedure, or practice requirements of the agency.

Basic Rulemaking is Notice and Comment

Agency rule is analogous to congressional statute

Order APA 551(6)
Residual definition. Agency pronouncement that is not a rule.
"the whole or part of a final disposition, whether affirmative,
negative, injunctive, or declaratory in form, of an agency in a
matter other than rulemaking but including licensing.

Outcome of an adjudication.
Not required to be published

APA prefers rulemaking as way of agency policy. However, some
agencies, like NLRB and FTC rely on orders to announce policy.

Excelsior Underwear and Wyman-Gordon
Rules regarding providing names for labor elections was held for
future cases, but not applied to Excelsior (NLRB)

Wyman-Gordon disputed application of rule to them but S.Ct. said
choice or rule or order was within decision making power of
agency. Upheld order.

Bell Aerospace
NLRB had changed policy from case to case. Second circuit said
policy changes must be decided by rule. S.Ct. held that agency
could use orders, had not abused discretion.
Criteria for agency discretion.
Diversity and complexity may favor case by case
Little evidence that Bell had relied on earlier decisions.
Change of policy did not create new liability
Company did not face fines or damages.

Rule Order Controversy: Well settled.
Most agencies, except NLRB will proceed by rules, however agency
has power to use order. Challenge to rule order is usually
judicial waste of time.

Rulemaking

Who's ox is being gored?
Two attacks: (1) substantive provisions or (2) the way the rule
was made (not favored by S.Ct.)

Rulemaking under APA
From Enabling Act (congress can make interim emergency rules)
From Agency when investigation shows rules are necessary
From citizens "interested persons right to petition."

Found in 553 APA
"553 Rulemaking" "notice and comment rulemaking" "informal
rulemaking"

Scope of 553
Must fit definition of agency
Exemptions
Military or foreign affairs
management or personnel
public property
loans grants benefits and contracts.

Notice Requirement
Time place and nature of public rulemaking proceedings
Statement of legal authority
Language of proposed rule or merely a description of the topics
and issues involved
Invitation to any interested persons to submit comments.
Usually a cut off date.

Exceptions to notice requirement 553(b)
Interpretive rules, general statement of policy or rules of
agency organization, procedure, or practice.
Good Cause Finding that notice is impracticable, unnecessary,
or contrary to public interest. This finding must be published.
Courts usually defer to agencies.

Comment
Most agencies must accept written comments. Some (FTC) need oral
hearings. Agency must log and review. Especially good faith
requirement to review from entities seriously affected.

Court will be suspicious of agency rule that ignores all comment.

Final Rule
Concise and general statement of basis and purpose

In effect no earlier than 30 days
Exceptions
A rule that provides and exemption or relieves restriction.
(eases regulations)
Interpretive rules and policy statements
Good cause finding. Included in publication.

Courts can not impose additional rulemaking on agencies that is
not found in Enabling Act, APA, or Agencies own Rules

Florida East Coast Railway
ICC could promulgate rules "after hearing"
Opponents argued for formal rule-making under 556-57
APA and IC Act use hearing does not trigger formal rulemaking
unless language "on the record after opportunity for agency
hearing" is used.
IC Act does not require more process than APA

Formal rulemaking is never required unless Congress uses the
precise words in the enabling act.

Hybrid Rulemaking Vermont Yankee
Hybrid rulemaking is when agency uses more procedure than required
under 553 of APA but less than 556-57.
Courts can not order agency to use more rulemaking procedures than
those of 553 unless enabling act requires.

Vermont Yankee rulemaking used oral hearings and written reports.
Challenger wanted to invalidate findings of NRC because they
couldn't cross examine author of some of tables and data. The
Circuit Court held for challenge, reversed by S.Ct.

Exception might be Goldberg v. Kelley extremely compelling
circumstances.

Congress can compel Hybrid Rulemaking e.g. Magnuson-Moss Act.
Sets procedures for FTC rulemaking.

Agency can chose Hybrid Rulemaking

Negotiated Rulemaking
Negotiated Rulemaking Act of 1990
Usually small group of participants whose interests are limited.
By committee with balanced representation
Notice published in Fed. Register and people can request to be on
committee.
If committee is successful in developing proposed rule it is
published and notice and comment proceed.
If committee fails, agency has basis for rulemaking

Other restrictions by Statute
Government in Sunshine Act
NEPA
Paperwork Reduction Act
Regulatory Flexibility Act

Supervision by OMB

Reagan ordered OMB to institute policies for agencies.
Cost-Benefit Analysis of Proposed Regulations
Agency must prepare Regulatory Impact Statement

Competitiveness Council under Bush-Quayle

Cost Benefit Analysis
Regulation is analyzed, costs against benefits. If cost outweigh
benefits, action is not taken. If benefits outweigh costs action
taken.

Problems of proportionality and incremental costs of 100% benefit.
A portion of action may result in greater savings.

Supreme Court Rulings

Benzene: overturned statute requiring agency to set standard
which insures to the extent feasible no employee will suffer
material impairment even with regular exposure.
Act did not give OSHA authority to set up risk free criteria.

Cotton Dust: Manufacturers argued for standard based on cost-
benefit analysis of "feasible". Unions argued that "feasible"
means whatever is technologically possible.

Court held that no cost-benefit is necessary because Congress had
performed cost benefit in passing the regs.

Ex parte Contact

Problems of revolving door and "captive agency" (agency caters to
the constituency it regulates.

APA makes it clear that ex-parte contacts in adjudication are
generally prohibited.

In rulemaking is difficult, because agency encourages input.
Several cases have ruled on improper ex parte contact during
rulemaking procedures.

HBO v FCC Commissioners had input from companies off the record.
Rules stated basis is in comments. Court invalidated the
regulations and sent it back to the commission.

ACT v FCC Rulemaking canceled after 'jawboning' and voluntary
compliance by networks. Court upheld the agency.

Sierra Club v Costle: White House contacts with EPA expressing
its views. Court held not wrong, but actually important for
agency to have the views of other executive agencies and
President.

Bias

Association of National Advertisers v FTC
Pertschuk had expressed opinions during rule making procedures.
Move to disqualify him.
Court held that it is not basis for disqualification in informal
rulemaking procedures. Contrasted to bias of Federal Judge or to
a Commissioner who must adjudicate. (Cinderellea Cases, Dixion).
Less problem with bias in informal rulemaking. May be more of a
problem in hybrid, formal rulemaking. Definitely a problem in
adjudication.

Substantive Rules v. Other types of Agency Pronouncements

Substantive rules have effect of law e.g. federal statute.
United States v Nixon Not only people, but agency restricted by
the rules. Agency is bound by the rules it passes about itself.
RULE MAY NOT BE ABANDONED OR RESCINDED BY AGENCY EXCEPT BY THE
SAME PROCEDURES IT WAS PASSED.

State Farm: Challenged DOT's decision to modify passive restraint
rules.
Standard for making the rule and doing away with it are the same.
DOT failed to provide a "reasoned analysis"

Retroactive Effect of Agency Rules
Substantive rules are not generally retroactive. However, an
interpretive rule may be. If rule states how a formula is to be
calculated, it may be an interpretive rule, but will have a
serious retroactive effect.

Estoppel Against Government

The Government may not be estopped. YOU RELY ON ADVICE GIVEN YOU
BY AGENCY PERSONNEL AT YOUR OWN RISK.

Public policy requires different standard for government (Merrill)
ON Notice Because the Rules were Published.

Agency does not have to invoke estoppel
Although no difference between oral and written, some written
communication may be honored Especially if from high ranking
official. Sometimes agency will agree to be bound by written
decisions. IRS rulings. Take a lot of time

Declaratory Order under 554(e)
Like declaratory judgment. Needs to go through informal
rulemaking.

CHECKLIST FOR RULEMAKING ISSUES

A. Is it Rule or Order. (Courts won't disturb orders)
B. Look at Procedure and Contents Separately

Procedures
Evaluate procedures being used. Unless congress says differently
553 is the maximum required. Unless exceptions
Read the enabling act. Agency must follow specific procedures.
Is bound by its own rules (Nixon) Must follow 553 procedures or
may be invalid. Proper procedures must be followed when amending
and rescinding (State Farm)
Distinguish interpretive from substantive. Agency will often
put interpretive rules through rulemaking to make sure they are
upheld.
Review record for ex-parte contacts

Consideration of Substance

a. Compare what rule says with enabling act. If rule exceeds
limits of enabling act, agency is acting in excess of its
authority.
b. Review the statement of basis and purpose. If agency had
not provided a reasonable and rational explanation of purpose
for rule or recission court will overturn the agencies action as
arbitrary and capricious.
c. Agency may not be estopped for erroneous advice.

BIAS
Role of ALJ

Pre-Decisional Bias
Test for Bias " Whether a disinterested observer may conclude that
the agency has in some measure adjudged the facts as well as the
law of a particular case in advance of hearing it."

Paul Dixon FTC Chair

Statements made in course of duties are not usually grounds for
disqualification.

Bias at Hearing
Very hard to establish
Get on written record (the judge is reading a newspaper)

Rule of Necessity

Questions of bias moot, because there are not other means to
resolve the issue. e.g. Judges ruling on dispute of judges pay.

People who have financial stake in outcome of hearing will have
very difficult time surviving as decision makers.

Gibson v. Berryhill (Optometry cases)
Tumey (Departments budget salaries tied to revenue from traffic
violations.)

Informal Agency Action

Is agency required to take action
Does Action affect private person
IF 1 & 2 YES Is it rulemaking?
If not, does agency provide a trial-type hearing before
decision?
IF NOT, Agency is engaged in informal action.

555(e) APA
Prompt notice shall be given in whole or in part of a written
application, petition, or other request of an interested person
made in connection with an agency proceeding. Except in affirming
a prior denial or when the denial is self-explanatory, the notice
shall be accompanied by brief statement of the grounds for denial.

Not applicable to mass of administrative routine unrelated to
specific proceedings.

Control of Informal Agency Action by Courts

Control of Substance
Overton Park:
Secretary had to (1) consider alternatives (2) insure steps to
minimize environmental damage.
Courts Standard of Review = Arbitrary and Capricious
Court held that record was not sufficient for court to reach any
conclusions as to validity of secretary's action.
No need for formal findings and conclusions but must give reasons
for action.
No post-hoc rationalization

Overton Park sets basis that reviewing court must take a hard
look at the agency record to determine whether the underlying
statutes have been complied with and proper procedures followed.

PROTECTS AGAINST UNFETTERED AGENCY DISCRETION

Control of Procedure of Informal Action

Does it comply with procedures in enabling act
With existing agency procedural regulations
Compatible with constitutional due process

Getting Into Court: Judicial Review of Agency Action

Courts review relatively small number of decisions
Courts set aside even fewer decisions

Whether the case can be taken to court
When judicial review is appropriate
What kind of review will the court perform

Jurisdiction
Enabling Act
General Jurisdictional Statutes 1331, 1337

Even in enabling act, Congress may have created multiplicity of
jurisdictions.

Venue, Service of Process Proper Form of Action

A regulated party can raise the issue of validity of statute any
time it is applied to them, even if 30 day time period has
expired.

Sovereign Immunity

Not bar to actions for declaratory and injunctive relief. Can bar
claims for monetary damage. Can bring suits under FTCA or Tucker
act or Bivens type action against the employee (not the agency).

Preclusion

If the matter is precluded, the court may not act.

Statutory Preclusion
Matters committed to agency discretion

Presumption in Favor of Judicial Review

Must be found in statute, or congress' "showing of clear and
convincing evidence"
PRECLUSION MAY BE TOTAL OR PARTIAL (Limiting types, times or
places for challenges)

Courts can sometimes review matters committed to agency
discretion on "abuse of discretion" basis.

Issues of "law to apply"
Overton Park: Agency had discretion, but the enabling act
provided for alternatives, and minimal disruption therefore there
was law to apply.

Complexity
When issues are too technical or complicated, courts may decline
to review the actions.

Discretion to Take No Agency Action

Discretion not to make rule
Natural Resource Defense Council, Inc. v SEC
D.C. Circuit now believes that agency refusals to make a rule are
not entitled to any presumption of non-reviewability.
Abuse of discretion. Arbitrary and Capricious

Discretion not to take Enforcement Action
Heckler v Chaney
Death row inmates challenged FDA on lethal injection use of drugs.
Court ruled that action was not reviewable under 701(a)(2) it
was committed to agency discretion.
Agency's decision not to pursue enforcement not reviewable
Changed presumption of reviewability for enforcement actions.

Standing
From Article III 2 case and controversy

litigants must actually stand to gain or lose something
look for mootness, political questions, "stake in outcome"

Does the plaintiff have a "legal interest" or "Legally protected
right" 702 APA

Data Processing Test
Plaintiff must allege
the D's acts have caused plaintiff personal injury in fact,
economic or otherwise and
the P is arguably within the zone of interests to be protected
by the statute or constitutional provision in question.

Sierra Club v Morton
P did not have standing because no allegation that any member of
Sierra was injured by the action

SCRAP
Complaint was framed properly so to allege that students were
injured: met both parts of Data Processing.

Simon v EKWRO
Sued for hospital to lose tax exempt status for refusal to treat
indigent patients
Didn't get past first prong of Data Processing (injury in fact)
Actions by IRS could not have caused P injury

Injuries must be directly and plausibly connected to actions of
defendant.

Valley Forge
P claimed that giving surplus property to church related group
violate first amendment.

Injury must be personal and not one that is suffered by every
other citizen. (Taxpayer type suit). Fact that members have an
interest in the subject is not enough.

Lujan v. National Wildlife Federation
Claimed individual members were injured who had visited in
vicinity of reclassification. District Court dismissed on Summary
Judgment. CA overturned summary judgment.
S.Ct. distinguished Lujan from SCRAP. Challenge to SCRAP was
12b6, on the pleadings. Lujan was summary judgment so Court could
look beyond the pleadings to the facts of the case. S.Ct.
reversed Court of Appeals. "Bare Bones allegations were not
sufficient for court to presume the missing allegations of injury.

Lujan v. Defenders of Wildlife
Challenged action of Foreign Aid to countries who were violating
endangered species act.
Even though the P's claimed they had visited the areas in the
past, and planned to return, the injury was too tenuous. Perhaps
if they had alleged that they had tickets to visit at a particular
time, the court would have granted standing.

Clarke v Securities Industry Association

Court added an additional test for P's who survive zone of
interest.
"...inquiry does not end with the "zone of interest" test.. . . .
.because at bottom the reviewability question turns on
congressional intent, and all indicators helpful in discerning
that intent must be weighed."

Air Courier Conference v. American Postal Workers

P's challenged regulation permitting private couriers to deliver
to foreign postal services. (formerly a monopoly of post office).
S.Ct. held that although the P's were in zone of interest, however
the relevant statute did not give any protection to the postal
workers.

Taxpayer Standing

Courts have been very reluctant to recognize claims based on
status as taxpayers.

Flast v. Cohen
P's challenged expenditures made from agency to private religious
schools. Only status was as taxpayers claiming injury under the
establishment clause of First Amend.

Two part test (Flast)
Connection between status as taxpayers, and the legislation
attacked. (spending of money)
Connection between their status as taxpayers and the
constitutional infringement (absolute prohibition against
expenditure of tax dollars, such as Establishment clause, is being
violated.

Valley Forge P's did not satisfy the Flast test, because the
challenged act was not spending of tax dollars, but rather
disposition of property.

Third party suits

Generally, not permissible. However a few exceptions. Bar Owner
challenged prohibition of sale of beer to 18 year old men, while
women were permitted to purchase. Court ruled on reaching the
merits (gender discrimination under Equal Protection Clause).

Some Congressional legislation, such as Clean Air Act, permits any
person to sue violator or the agency.
QUESTION IS UNRESOLVED IF CONGRESS CAN EXTEND ARTICLE III TO THIS
EXTENT.

Checklist for Review

Federal Subject Matter Jurisdiction. Enabling Act or Title 28
standing.
Remedy Sought. Immunity Issues. Monetary damages under FTCA
or Tucker Act. Injunctive or Declaratory relief OK under APA
Preclusion. Are issues properly reviewable under APA.
Is there preclusion in statute? Does agency have broad
discretion?
Standing. Identity of Plaintiff, and has plaintiff suffered an
injury in fact. Data Processing test as refined.

Judicial Review : Staying in Court Primary Jurisdiction,
Exhaustion, Ripeness

Primary Jurisdiction

Choice between going to agency or to court for conflict
resolution.

Landmark case Texas and Pacific RR v. Abilene Cotton Oil
Company sued in Federal Court over dispute in Railroad tariffs.
Court held that the issue must go to ICC for resolution.
Once agency has made determination, parties can still go to court
at later time.

Doctrine essentially does not preclude matters from being heard by
court, but defers the timing.

Sometimes Court acknowledge that they have jurisdiction, but lack
expertise to hear a case that is in bailiwick of agency. U.S. v.
Western Pacific (dispute over rates for shipping napalm).

Antitrust Allegations Ricci v. Chicago Mercantile Exchange
Ricci sued when he lost seat on the exchange. Although the
Courts, rather than the agencies, have jurisdiction in Antitrust
matters, the primary jurisdiction was to the agency.

Courts show great deference to the Agency.
Critics accuse the courts of abdicating their powers to the
agency.

Primary Jurisdictions to Court: Nadar v Allegheny Airlines,
Inc.

Nadar was bumped from flight. Sued the airline. Even though the
CAB had recently established compensation standards for bumped
passengers, the court agreed to hear the case. One reason may be
that Nadar framed his complaint as an action for fraud. The claim
became a tort rather than an issue involving agency action.

Final Order Requirement of APA 704.
Agency action made reviewable by statute and final agency action
for which there is no other adequate remedy in a court are subject
to judicial review. A preliminary, procedural, or intermediate
agency action or ruling not directly reviewable is subject to
review on the review of the final agency action.

Issues sometimes arise in determining what "final agency action"
is.

POLICY IS THAT COURTS SHOULD NOT INTERFERE TO TAKE MATTER OUT OF
THE AGENCY BEFORE THE AGENCY ACTION IS COMPLETED

Ripeness

Whether the issue that is presented to the court is sufficiently
mature and sufficiently crystallized to be a dispute with which a
court can deal.

Courts do not like to address technical issues but will address
the legal concerns if properly framed. Not if the agencies
regulations are technically or scientifically correct, but rather
did they follow the proper procedures in order to formulate a
reasonable basis for the rule.
Landmark Case is Abbott Laboratories v. Gardner

Drug Manufacturers challenged the FDA labeling requirements
showing the generic name every time the brand name was used.
Government argued that since no enforcement action had been taken
against any of the parties, the issue was not ripe for review.

Court determined the issue was ripe for review and established
two-part test.

Two Part test for Ripeness

Whether the issue presented to the court is fit for review
(legal fitness test), and:

looks at fitness as legal issue (e.g. ultra vires action) as
opposed to technical issue

Whether withholding review would impose a substantial hardship
on the party seeking review.
Party will have to comply with the rule even if it is invalid.
Risk of enforcement action and penalties for failure to comply.

Exhaustion

Exhaustion is the other side of ripeness. Used to prevent
premature judicial review and permit agency an opportunity to
resolve its cases.

In order to deal with an exhaustion order first test for ripeness
using two part Abbot test. If no ripeness issues, analyze for
exhaustion.

Typical Cabinet AgencyTypical Ind. Reg. Commission1. Secretary1.
Commissioners2, Asst.
Sec.OfficeAdministrationBureauDivisionDivisionSectionSection
If case is anywhere below Level 1 there is probably an exhaustion
issue.

Aggrieved party should be required to pursue remedies within the
agency before jumping to court.

Factors for exhaustion case law form McKart v U.S.

Pro exhaustion factors
Letting agency apply its own expertise to matter
Respecting the autonomy of agency
Preventing review on incomplete record
Cutting down on workload of courts, agency should take care of
problem at higher level of agency.

Factors that mitigate in favor of exhaustion
Agency has no power or insufficient power to resolve the issue
Agency has already made up its mind (futility)
If federal court P would be irreparably harmed by withholding
judicial review
If attack is against the constitutionality of the entire
agency's structure.

Judicial Review on the Merits

Generally the courts give wide discretion to agencies. Most cases
of judicial review succeed only if (1) record is appallingly
incomplete (2) some bad evidence (3) ex parte contact has poisoned
a case (4) points of view not fully considered (5) drastic change
in agency policy not fully explained.

Look at Enabling Act : Congress often specifies the terms of
judicial review on the merits.

Substantial evidence
arbitrary and capricious

If enabling act is silent, look to 706 APA

Court has the power to decide all relevant questions of law,
interpret constitutional and statutory provisions and determine
the meaning or applicability of terms of an agency action.

Power of Court
compel agency action unlawfully withheld or unreasonably delayed;
[or] hold unlawful and set aside agency action [which is]
arbitrary and capricious
an abuse of discretion
otherwise not in accordance with law [or is]
contrary to constitutional right, power, privilege or immunity
in excess of statutory jurisdiction, authority or limitations
short of statutory right
without observation of procedure required by law
unsupported by substantial evidence [556 or 557]
unwarranted by facts [in de novo proceeding]

Overton Park: Roadmap for Judicial Review
Enabling Act set standards for secretary to consider. Therefore
there was law to apply. Secretary's decision was not completely
committed to agency discretion. Was reviewable under APA no
preclusion.

Review of the Agency Record
"Hard look" is the doctrinal standard.
Must examine whole record and review both sides.

State Farm
Court reviewed the entire record, careful scrutiny, held that
there was 'no reasonable basis' for the recission of the rules

Standard of Review: De Novo, Substantial Evidence, Arbitrary
and Capricious

De Novo
Can be authorized by statute.
Two other instances
Action is adjudicatory in nature and the agency's fact-finding
procedures are inadequate
Issues not before the agency raise in a proceeding to enforce
nonadjudicatory agency action

Rarely does De Novo review occur except if authorized by statute.

NOT APPLICABLE TO OVERTON PARK

Substantial Evidence
In a case subject to sections 556 and 557 of APA or otherwise
reviewed on the record of an agency hearing provided by statute.

Arbitrary/Capricious

The residual or default standard of 706. If de novo or
substantial evidence are not authorized, remaining standard is
arbitrary and capricious.

Judicial Review of Agency's Factual Determination

Questions of Basic Fact
Mixed Questions of Law and Fact
Questions of 'pure law'

De Novo Review
Court is free to substitute its judgment for any of the agency's
findings and conclusions.

Substantial Evidence Review: Only Applies to 556 and 557
'SOMETHING MORE THAN A SCINTILLA Relevant evidence a reasonable
mind might use to support a conclusion.

Reasonableness

"must do more than create a suspicion of the existence of the fact
to be established. . .It must be enough to justify, if the trial
were to a jury, a refusal to direct a verdict when the conclusion
sought to be drawn from it is one of fact for the jury."

While facts submitted to the agency by the ALJ were important,
they could be set aside by higher ups in the agency drawing on all
the agency's expertise.

Arbitrary and Capricious

Overton Park "the decision was based on a consideration of
relevant factors and whether there has been a clear error of
judgment.
Most academics disregard the Overton Park definition

Usually, agency action will be reversed only is it lacks a
rational basis. This is highly deferential to agencies as almost
any decision will have some rational basis.

Judicial Review of Questions of Law

Does the agency's substantive rule have the effect of law.
Must court defer to the agencies determination that the
agency's own enabling act does not violate the non-delegation
doctrine and that its procedures are compatible with
constitutional due process.

Mixed Questions of Law and Fact
Courts have more leeway in addressing these types of issues. e.g.
'is a buyer an employee'

NLRB v. Hearst
NLRB ruled that newsboys were 'employees' for purposes of
collective bargaining. Court of Appeals reversed the agency
applying common law principals of respondent superior. Held that
newsboys were independent contractors and could not form union.

S.Ct. reversed, and held that common law was not dispositive,
rather, since it was brand new statute, deference to the agency.

Two part test.
what criteria did the agency use in interpreting the statute?
If the interpretive criteria are consistent with the
legislative history of the statute, was the agency's ultimate
decision reasonable?

Constitutional /Jurisdictional Facts

"was the employee acting in course of employment"
"was the injury upon the navigable waters of the U.S.?"

These types of ultimate facts have to be proved or the agency may
lack any jurisdiction.

Agency's interpretation of its own statutes
No clear position from S.Ct. has had conflicting results.

In Public Service Commission of N.Y. v. Mid Louisiana Gas Co, the
court over ruled an agency determination regarding definition of
"first sale" of natural gas holding that the agencies position was
"contrary to the history, structure and basic philosophy of the
Natural Gas Policy Act.

One year later in Chevron (dealing with how to treat emission
standards from multiple facilities on a single plant as a 'single
source') court held that EPA's interpretation "represents a
reasonable accommodation of manifestly competing interests and is
entitled to deference in which a regulatory scheme is technical
and complex.

Judicial Review of Agency Policymaking

Addresses challenges to agencies policy determinations.
Landmark case is Chevron
Agency implemented "bubble policy" ; all stacks on a single plant
can be consolidated to meet the standard.
Environmental group challenged the agencies policy .

Chevron "two step" test

Has Congress spoken to the precise issue at question?
If yes, neither the courts nor the agency can interpret contrary
to congressional mandate.

If Congress is either ambiguous or silent, the reviewing court
examines the agency's construction of the statute. The court must
defer to the agency's position if it finds it is reasonable.

Agency Consistency

Agencies are better equipped to deal with the changing
circumstances and conditions in society. Agencies have the power
to change their positions as the conditions or information may
change.

However, elements of fairness demand consistency and evenly-
applied actions. Change, improperly implemented can do a great
deal of harm to members of society.

State Farm case is example of agency change of policy that was not
based on reasonable standards.
"An agency's view of what is in the public interest may change,
either with or without a change of circumstances. But an agency
changing its course must supply a reasoned analysis."

In State Farm all the justices agreed that the agency had provided
no reasoned analysis whatsoever for its decision to rescind.

Court will permit agencies to modify and rescind rules. But it is
equally clear that the changes have to be elaborately and
plausibly explained.

Synopsis

Courts will usually not overturn an agency action

If challenge is on facts, little chance of court overturning
Mixed question of law and fact, less deference to the agency
Facial challenge to enabling act, no deference to the agency.

Private Actions Against Government and Government Officials

Sovereign Immunity

Concept of sovereign immunity nearly absolute.
May only be abrogated by Act of Congress. Act must specifically
grant right to sue, can't be implied from the context.
Congress created two general exceptions FTCA and Tucker Act
(Claims and contract disputes against the government)

Immunity and Suits against Federal Officers

Early case was Ex parte Young (1908). Court permitted suit
against state attorney general you was " acting outside the scope
of his duties" ultra vires.

Larson (1949) If the actions of the officer do not conflict with
the terms of his valid statutory authority, then they are actions
of the sovereign, whether or not they are tortuous under general
law....

Barr v. Matteo
Employees sued agency official for defamation for remarks made at
press conference. Actions were within the scope of duties. Court
extended immunity from "executive officers of cabinet rank" to
other agency officials. Privilege of immunity is not a personal
privilege of position, but rather an expression of policy designed
to aid in the effective functioning of government.

Bivens type actions. Suits for constitutional torts.
No remedy existed for constitutional violations of unlawful search
and seizure. The sanction of suppression not appropriate because
no charges were filed.

Court held that federal jurisdiction existed for this action,
found in common law tort, even though no statute authorized the
action. Money damages could be awarded. However, these types of
actions are personal actions against the employee and the judgment
is not paid by the government.

Butz v. Economou; Qualified Immunity
P' brought constitutional claim against officials of the
Department of Agriculture, including the Secretary Earl Butz.
(Claimed first amendment violation of freedom of speech.)
Government claimed sovereign immunity.

Court held:
Immunity is qualified, not absolute. The P must prove malice
to overcome immunity. Officials are subject to suit
For certain officials, judges, prosecutors, agency attorneys
litigating suits, immunity is absolute.
Agency actions analogous to judges or prosecutor are absolute
immunity.

Harlowe v. Fitzgerald Qualified Immunity

Suit against officials in Nixon administration for claim of
retaliatory firing of federal employee.

"Qualified immunity would be defeated if an official knew or
should have know that the action he took within his sphere of
official responsibility would violate the constitutional rights of
the plaintiff, or if he took the action with malicious intention
to do cause a deprivation of constitutional rights or other
injury. . . ."

Federal Tort Claims Act (FTCA)
Enacted in 1946. Right to bring certain types of tort claims, and
for the judgment to be paid by the government.

Personal injury or property damage caused by federal employee
while he is acting within the scope of his duties.

Local tort law is the standard.

Employees enjoy absolute immunity. (Not immune from Bivens)

No punitive damages or pre-judgment awards

Exceptions
Not liable when performing discretionary duties (e.g. policy
making decisions) limited to ministerial duties.

Activities in foreign country
collection of tax or duty
libel, slander, misrepresentation, deceit or interference with
contract
Assault, battery, false imprisonment, false arrest, malicious
prosecution, or abuse of process (but not Bivens suits)
Where other statutes bar a claim.

U.S. v Varig Airlines
Claim for negligent safety inspection of 707 was dismissed on
basis that agency was performing a discretionary action rather
than ministerial. Manufacturer essentially did the safety
inspections and engineering and the agency had the ability to
review as it thought prudent. No part of the inspection process
was mandatory.

U.S. v. Gaubert
Sued government for negligence in failing to properly supervise a
failed S&L. Court held that discretionary acts were not limited
to the upper reaches of the agency. Supervising the daily
activity of S&L also involved discretionary matters of judgment.

The Tucker Act
Provides ability to bring suit against government in Court of
Claims in D.C. Suits are for claims in excess of $10k. Claims
care brought either on the Constitution, or any Act of Congress,
or any regulation of an executive department, upon an express or
implied contract with the United States, or for liquidated or
unliquidated damages in cases not sounding in tort.

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