Administrative Law Class Notes

8/7/2019 Administrative Law Class Notes

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ADMINISTRATIVE L AW C LASS NOTES

CLASS ONE (01/10/2010)

Focus of Coursey Based on federal lawy R eview portions of the Constitutiony Certain agencies that appear over and over againy R eview all different permutations involving agenciesy W hat standards and controls are imposed upon federal agencies right now

TEAMSIn-Class Participation

y If a case or something in the reading is about your team then that team is on-call forthose cases for that days reading.

y K eep track of current events of the agency create google alert for agency y R ead the commentary at the end of each case

Research Projecty Each team has to complete a final report on a federal agencyy 15% of the final grade

FINAL EXAM y L isten to the goals at the beginning of each classy L isten to takeaways at the end of every classy

M idterm is multiple-choice

Administrative Law History y There were government agencies and administrations going on right after the U.S.

became a countryy First Three Cabinet Departments in the US (made up of 50 people)

o Treasuryo War o State had 6 employees when it first started.

y Today there are 8 0 federal agencies, 15 cabinets and sub-groups many agenciesy Federal budget in the early 1800s $11 million dollarsy Today the federal budget is approaching $4 trillion dollars

o This is because of expansion, country is much larger y Today 3 million people are working for the federal agencies in the USy In the 1st Congress they enacted statutes and told the agency that to do whatever the

President wantsy The war department in 1807 was authorized to seize goods if, in their opinion, they were

trying avoid the blockade.y Legislative standard for the people in charge of giving land to people was justice


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y In the 1800 s there was no staff to review the reports that were required.

** TAKE AWAYS ** y Focus on establishing a foundation for understanding the administrative state and

the growth of administrative agenciesy How pervasive federal agencies and the administrative state are in our daily livesy Characteristics of the early agencies

o Very small and clearly financedo Congress gave them very broad powers and unspecific guidelines for

decision-making (decide things on the basis of justice and fairness; whatentities outside of the govt. tell you)

o Admin. Agencies out on their own. Very little accountability and oversight.No one to review reports

y The growth and size of the government in the country andindustrialization/modernization/technology

CLASS TWO (01/12/2010)

Goals for class1.) Understand additional factors that produce growth and shape the agencies2.) Examine and appreciate the position of various agencies within the government3.) Identify the different basic purpose for the existence of agencies4.) Different forms of power that agency administrators feel in carrying out duties5.) To look at the agencies internal structure who s at the head, where offices are locatedwithin the agency.

Broad Factors (Crises) That Created Agenciesy Economic crisisy Wars

o Claims to pay and collecto Fund the military

y Current financial criseso Banking crisis

y Gas shortagey Natural disaster

o K atrina (creation of FEMA )o BP oil spill

y Self-interested decisions for legislators and bureaucratso Spoils system under Andrew Jackson (Patronage)o To get party loyaltyo Cronyism Too many people in the government and most were unqualified for

what they were employed to do

The Golden Age y Period of incredible wealth at the end of the 1800s.y Unfettered capitalism


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y V ery little regulationy No income taxesy R obber Barons were the people heading the industry

Response to the Golden Age y Creation of the FT C to regulate this incredible accumulation of wealthy The Progressive Era

o Made up of farmers,o R eforms brought about the growth of the administrative ageo More attempts to regulate class and workers

y The New Deal Erao Created in response to the Great Depressiono Built many of the buildings in D.C.o Many, many govt. agencies were created

SEC NL R B

Administrative Procedure Act created because there was a real need toimpose specific standards after the explosion of new agencies, coupledwith the bad economy

y The Great Society o During the 1960s and 1970 so More agencies created to deal with race and sex discriminationo Worker safety and Environmental Protection

Late 20 th Centuryy De-regulation and less oversighty Presidential oversight increased and the power of the Executive grewy Downsizing and cost-control

o R educed the number of federal workers and increased the number of contractorso Federal budget increasedo Increased delegation of programs to states and localities

Some areas had education, environmental, economic issues, etc., andfederal govt. felt that the states were better suited to handle those issues

y Managerial R eforms because of deficiencies and inability to handle tasks properly

ARCHITECHTURE OF FEDERAL GOVERNMENT

Four Basic Different Types of Agencies y 15 Cabinet Departments

o W ithin these are frequently different agenciesy Stand- A loney Independent R egulatory Agencies

o FCC, FT C, S EC and most things that end with commissiono (1) Have a panel of a group of members (or collegial body)

Each person gets one vote


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Can only be removed for o (2) R estrictions as to political party No more than 3 members of a political partyo (3)o Looking at the Enabling Act for that particular agency is the best way to

determine which type of agency it is and what its powers are.

PURPOSES y Developmental

o Gather and disseminate information to assist others in the pursuit of productiveactivities ( NOAA )

o Promote learning and economic development ( NSF y Social Welfare

o SSA, NI H, D V A y Regulate Private Economic Activity

o In charge of macroeconomic steering of the national economy, through taxpolicies and monetary policies

o At the microeconomic level, seek to maintain the integrity and smoothfunctioning of the principal financial intermediaries and markets that generate andallocate capital

POWERS y Grant and contract powers ( National Endowment for the Arts)y Standard Settingy L icensing FCC, Patent and Trademark, etc.,

INTERNAL ORGANIZATION y Have certain customs that have developed over the yearsy Developed by the classification of the Executive personnel there (usually a function of

politics)y Secretary Head of the agencyy Deputy Secretary Second in commandy Assistant Secretaries Usually a number of different groupsy Shaped by the functional requirements of mission, powers, procedures, executive orders

and general statutes ( Enabling Act)

Take Aways1.) Cabinets2.) free-standing Agencies3.) Independent and R egulatory Agencies4.) Departments

How to Tell Which Agency Does What1. Purpose2. Type of head3. Forms of Administrator s powers4. Look to the enabling statute


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Class Notes 01/19/2010

1.)2.) Impact and Control that the Legislative Branch attempts to assert over the agencies3.) Looking at one piece of law Statute

y

* Virtually all agency action begins with a statute Goals

y How Congress asserts control of administrative agenciesy Examine how Congress uses statutes to establish power over administrative agenciesy Two problems

o Overly Broad Delegationo Overly Precise Delegation

Sometimes when Congress tries to be too detail-specific, it can defeat thepurpose of what Congress tries to do with the agency

Congressional Powers Under the Constitutiony Section 1 Congress has all powers to legislate

o All powers start with Congress and they have to delegate those powers toagencies

y Section 8 Specific powers granted to Congresso Enumerated list of congressional power

DELEGATIONy Doctrine of Non-Delegation

o Doctrine that focuses on the limits of permissible delegationo How much can Congress delegate to the agencies and to the President

y From the 1800 s to the New Deal era, Congress s delegation was pretty much rubber-stamped. Had pretty much a free hand

y Courts found ways of upholding very expansive delegated power o Sometimes the President was held in a contingency where he was applying the

law that Congress had passedo The President was just filling in details, so it was ok.o Courts eventually started to look for some sort of guidance given by Congress for

the President to followy The early standards of the Court were looking for an INTELLIGIBLE PRINCIPLE.

o Intelligible Principle Some sort of guidance given by Congress for implementing the statute

y Problems with Delegationo When branches overstep their authorityo When branches abdicate their authority

When the founders were drafting the Constitution they were careful tomake sure that no branch was more powerful than another.


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IMPORTANT CASES y Panama Refining Co. v. Ryan (1935)

o Dealing with the National Industrial R ecovery Act in the New Deal erao Pretty aggressive overstepping of the Executive Brancho Hot O il Act

Provision that authorized the President to exclude certain goods fromgoing into commerce and essentially following state law

V iolation of this provision was a crime punishable by fine or imprisonment

o Deficiency 9(c) provided no criteria for P OT US to base actions

y A .L. A . Schechter Poultry Corp. v. US (1935) o Court invalidated section 3 of the same Act, which empowered the President to

approve industry codes of fair competition upon submission by tradeassociations or business groups

o The only conditions limiting the President s power were that the groups

submitting the codes for approval had to be

truly representative of theindustry and could impose no inequitable restrictions on admission to themembership and that no code could be designed to promote monopolies orto eliminate or oppress small enterprises.

The provision makes sense because the President doesn t know anythingabout the chicken industry.

Congress didn t want insiders to create a code that would only benefit asmall portion of the industry players

y The Courts said that in both of these cases, the Act didn t provide the intelligibleprinciple that Congress needed to provide agencies/ Executive

y The reason the Courts struck these down is that there were competing political ideologies

on the Court deciding these issues.y Why Congress Gave President Broad Authority

o Anticipated that the President might need some flexibilityo If something went wrong, Congress wanted the blame to fall upon the Executive

brancho When Congress needs to do something, but is worried that it might not go

through, they pass something broad that they know they can get passed eventhough they know that its not very good.

J ust so it appears that theyre doing something

Yakus v. US (1944) y First post- New Deal case that went to the Supreme Courty The Emergency Price Control Act

o Provides L imitations The prices must be fair and reasonable The power to be exercised will tend to achieve the objectives and the

standards inherent in the purpose of creating the Act in the first place New Test: A n absence of standards which made it impossible for the

Courts to determine whether the will of Congress had been obeyed


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y This is not the intelligible principle, but rather a new test.y This is stronger and still allows for some flexibilityy It helps the Courts determine whether the President has gone off on

his own and exercised authority beyond the scope of Congressionalintent

y Courts are sending a message that the statutes must allow theCourts to determine whether the President is acting properly.

y The issue is one of line-drawing: How much can we delegate tothe President for purposes of efficiency and to agencies for purposes of many people working together.

A malgamated Meat Cutters v. Connally (D.C. Cir. 1971) y The whole country was very concerned about inflationy The way to keep that under control was to issue temporary price-freezesy To do this, Congress passed the Economic Stabilization Act of 1970

o Authorized the President to create a councilo Served as a bailout to employers that hired these unionized meat-cutterso President issued an Executive order under the ESA that froze wage increases

y The Meat Cutters said that the Act was unconstitutional b/c they were due for a wageincrease.

y The Economic Stabilization Acto No transparencyo No procedural safeguards if you are charged or convicted under the Acto Sunset Provision The thing doesn t go on forever, there s a limit to the

duration of the statute. Congress was being very careful in limiting the life of thestatute.

y This case is about vagueness and overly broad terms and the courts reaction tothem


LAST WEEK RECAPy A ll agency action begins with a statute y One of the Take Aways NEED TO GO IN OUTLINE

o Be able to identify statutory vagueness and overly broad delegation o Tests of Courts for overly broad delegation and vagueness

y Found by the Courts to be a problem when agencies enact authority of outside sources y Sunset Provision is one way in which Congress is able to limit a statute s reach y One of the goals of Congress in delegating authority is to prevent any avenue of bias or

abuse.

Public Citizen v. Young (1987) y Case about a color-additive that may be used only after the FDA has published a

regulation listing the additive for such uses as are safe


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y Case dealt with cosmetics lipstick and face powder y Congress passed an act that contained a clause known as the Delaney Clause

o Delaney Clause FDA can only approve an additive to a cosmetic when asubstance had been shown to cause cancer in animals.

y The scientific review panel found the lifetime cancer risks of the color-additive dyes as 1

in 19 billion at worst and 1 in 9 million worst.y The FDA characterized the risks as so trivial as to be effectively no risk. y FDAs response

o Decided that some things were d e minimis and went through with authorizing useof the products

y Ultimately, the Court ruled that the agency didnt have authority to go above thelegislative plain-meaning of Congress.

y A lso, they were worried that this would tie up the courts with constant adjudication.y If Congress didnt want to ban it:

o They could impose age restrictions and warning labelso Set a threshold level that anything above a certain range would be bannedo Could implement a phase-out period. Not ban it immediately.o R ank additives in different categories

y De Minimis Clause o If there weren t some kind of De Minimis clause then Congress would be backed

up with such trivial problemso There was too rigid a definition of the statute when Congress found out that the

De Minimis clause wouldn t work out.

LEGISLATIVE VETO y A mechanism by Congress where it gives authority to an administrator or member of a

high-ranking agency, but reserves the power to step in and override that authority.

IN S v. Chadha (1983) y Chadha was a K enyan-born student holding a British passport that came to America on a

student visa that expired in 197 2.y Chadha remained here with an expired visa and the IN S wanted to deport him.y 8 U.S.C. 244 provided that the AG may suspend deportation and adjust the status to

that of an alien lawfully admitted for permanent residence.y Pursuant to 8 U.S.C. 244(c)( 1) of the Act, the immigration judge suspended Chadha s

deportation and a report of the suspension was transmitted to Congress.y There was an escape clause

o A period of not less than 7 years immediately preceding the date of suchapplication

Proves that he was a person of g ood moral character (red flag: whatconstitutes good moral character?)

Is a person whose deportation would, in the opinion of the AG , result inextreme hardship to the alien or his spouse, parent, or child, who is acitizen of the US or an alien lawfully admitted for permanent residence


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y The court responded to Chadha s appeal by finding that this process wasunconstitutional.

y Court says there are 4 things that one House of Congress may do by itself o (1) House Can Initiate Impeachmentso (2) Senate Can Conduct Trials Following Impeachment on Chargeso (3) Senate Has Unreviewable Power to Approve/Disapprove PresidentialAppointmentso (4) Senate Has Unreviewable Power to R atify Treaties Negotiated by the

Presidenty Action by the House under 244(c)(2) was not within any of the express

constitutional exceptions authorizing one House to act alone, and equally clear thatit was an exercise of legislative power, that action was subject to the standardsprescribed in Article I.

CONGRESSIONAL REVIEW ACT y Signed into law in 199 6 by President Clintony GAO or Controller General acts as an auditor to make sure the acts are even better y Controller General involved because agencies were required to submit any cost-benefit

analysis of their regulationsy CR A requires Controller General to submit a report on every major rule

o Major Rule (1) Any budget of 100+ billion dollars annuallyy Prohibited Congress from going back and trying to pass something that was just the same

as something that was previously rejected if there was a joint resolution striking down theAct the first time.

y The time-process allotted was very strict. Had to wait 6 0 daysy Provides for Presentment

o If there is a joint resolution by Congress, then it has to go to the President for approval.

y Net-Neutrality Acto Internet prescribers cannot discriminate based on content.o Argument against it is that it would create a lack of incentive on the ISPs to make

money and manage their networks or expand their site s applications and content.y There has only been one successful attempt at using the CRA

o Bush, jr. blocked OSHAs ergonomic regulationso Congress could ve blocked funding (appropriations) for OSHAs new standardso In November 2 000 , there was a Congressional recess. OSHA waited until there

was nobody in Congress to stop OSHA from passing these regulations The House and Senate were both controlled by R epublicans and they were

able to create a perfect storm to block this under the C R A y Most Important Thing for CRA to Work

o Must have a rule promulgated by the agency o Each chamber of Congress has to pass an identical joint resolution on the

issue o After which the President has to Approve it.


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Take Aways From Mondayy Precision can be a problem when drafting statutesy Statutory delegation can be too broad, too precise or just righty The advantages and disadvantages of the Sunshine Act, overbroad drafting and draftingtoo precisely

STATUTES TO PROMOTE PROCEDURAL FAIRNESS & OPENNESSy Administrative Procedures Act (APA)

o More or less the centerpiece of administrative law o Created in 1946 to create a baseline of common practices and procedures that can

be applied consistently throughout all of the federal agencies o Its not the answer to everything

Still have enabling statutes to look at Constitution

If the agencies rules are consistent with the APA, Constitution and theenabling act, then those rules are the best to reference o Also designed to control or eliminate the abuses or omissions from this process of

rulemaking Biases and not adhering to processes To make sure that there was a fundamental degree of fairness in

adjudicating agency disputes. If you had a problem with the way anagency handled something you would have to get the legislature to changethe enabling statute or go to court

Sometimes they would make decisions and there wasn t support. If therewasnt openness, then how would anybody know? You d have to go to

court after the fact. o Structure

Five principle sections y R ulemaking y Adjudication y Judicial R eview W hen you have the right to review y Administrative Law Judges

y Freedom of Information Act (FOIA)o Adopted in 19 66 o Purpose is to make agency records available for the public on request for

examination o Intended beneficiaries in passing FOIA

Members of the Public The Press R ely on FOIA heavily

o If you re a requester, you need to know the procedures.o If you file the request appropriately, you dont need a good reason to get a

documento Most important thing in FOIA are the exemptions (Nine)


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y Privacy Acto Purpose is to provide individuals access to personal information in the

government s possession and to improve

y Federal Register Acto

TO ADVANCE SUBSTANTIVE GOALS

National Environmental Policy Acty Enacted in 1970 y A imed at protecting the environment and sets forth procedural requisites to assure agency

consideration of environmental valuesy Most important part of the Act is the requirement of an Environmental Impact

Statement y The problem with many of the procedures imposed by these agencies is that people will

abuse them for the purpose of blocking agency effectiveness

Regulatory Flexibility Acty R equires the agency to consider the impact of any regulation on small business y They have to look for alternatives, at the economic impact, etc.,

Paperwork Reduction Acty R eflected concerns about the impact of regulation similar to those that inspired the

original R FA

The Unfunded Mandates Reform Acty Imposes procedural requirements on Congress that are supposed to make it more difficult

to enact legislation that imposes costly new regulations on state and local governmentalbodies without providing additional funding

o Obligates agencies to seek information from and consult with state and localofficials about the impact of new regulatory requirements

o Agencies must prepare an analysis of local government impacts, for any proposedor final rule that may result in the expenditure by State, local and tribalgovernments

o R equires agencies to identify and consider a reasonable number of regulatoryalternatives, and from those alternatives select the least costly, most cost-effectiveor least burdensome alternative that achieves the objectives of the rule

Information Quality Act

STATUTES PROMOTING INTEGRITY OF AGENCY DECISION MAKERS

Ethics in Government Act y Established in 197 8 for the purpose of curbing personal gains


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o Ex: Someone that rules in favor of a company to set up a job after leaving thegovernment

y Imposed two new obligations on current employeeso

Inspector General Acty Extends to all cabinet departments an oversight mechanism originally attached to just two

departments Energy and Health and Human Servicesy The Act provides for presidential appointment and Senate confirmation of an Inspector

General responsible for o Oversight of all audit and internal investigationso R eview of proposed and existing regulations for their impact on fraud, abuse,

and wasteo R ecommendation of preventative policieso Investigation and prosecution of persons within the agency and outside for fraud

and abuse.y IG is directed to


PRINCIPLE SOURCE OF PRESIDENTIAL POWER

US CONSTITUTION ARTICLE 2y President s Power to Nominate

o Ambassadorso Public M inisters and Consulso Supreme Court Judgeso Other Officers (with a capital O )

y Appointment Power o W ith the advice and consent of the Senateo Congress may, by law, vest appointment of Inferior Officers

President Courts of Law Heads of Departments

o Have to be confirmed by the Senate by a simple majorityy R emoval Power y How Congress Plays a R ole in the Appointment and R emoval Power y How Article 2 Leaves Some Things to be R esolved by the Courts

B uckley v. Valeo (1975)y In 197 4, Congress passed the Federal E lection Campaign Act

o L imited contributions to candidates for federal office (2 USC 44 1a) o R equired disclosure of political contributionso Provided for the public financing of presidential elections o Limited independent expenditures to $ 1,000


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o L imited candidate expenditures from personal funds o Created and fixed the method for appointing members to the FEC

y Court said that under Art. 2 2, any appointee exercising significant authority pursuant tothe laws of the United States is an Officer of the United States and must be appointedin the manner prescribed by Art. 2 2.

y

It seems implicit that if you have a power to appoint, you should subsequently have apower to remove. y Sometimes with agencies, it says right in the enabling statute that the Presidential

appointee can be removed under certain circumstances. y A lso look to legislative history/intenty The agencies are engaged in investigating, rule-making, adjudicating and it may be the

case that because of this, the President doesn t have as much power. y Terms are staggered, in office longer, don t come and go with the President. y Look for procedural safeguards ie., can t have more than a simple majority from each

party y M yers

o Involved dismissal of a postmaster, not the Postmaster General o Court ruled that Congress couldn t limit the President s removal power because

Postmaster General was an Executive position.

H umphreys Executor v. United States (1935) y Humphrey s executor sued to recover what Humphrey would vey Congressional Aggrandizement

o When Congress passes a law trying to give itself more power y This is a case of Executive Aggrandizement in the sense that the President was trying to

usurp Congress s power to


Take Awaysy Appointment Power

o Article 2, Sec 2 Confers Presidential authority to appoint his ownadministrators

o Know how Congressional oversight of agency action and impeachmentpower limits that authority

y Remove Powero How Executive can use the removal powero How Congress can circumscribe the power

y How the Court has filled in/answered some of the open questions regarding thesepowers

o B uckley v. Valeo o Myers o H umphreys Executor

POWER TO INITIATE POLICYy Constitution


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o Section 2 President shall be Commander in Chief of the Army and the Navy o Section 2 He may require the Opinion, in writing, of the principal O fficer in

each of the executive Departments o Section 3 He shall take Care that the Laws be faithfully executed

y

Statuteso Much more useful in dealing with administrators in getting them to do things o 3 USC 3 01 Expressly gives the President power to delegate to executive

officials who are subject to Senate confirmation any function that Congress hasvested in the President by statute

y Youngstown Sheet o During the K orean War o President Truman ordered his Secretary of Commerce to take control of most U.S.

steel mills, which faced an impending strike, to insure continued productionduring the K orean War

o This was a national defense emergency, so the President directed the Secretary of Commerce to handle this.

o All nine Justices agreed that in order to do this, the President needed a source of power.

o All six justices agreed that it was unlawful for the President to act in this way o The three dissenters said that Congress had not expressly prohibited the sort of

seizure Truman undertook and that his initiative was a reasonable way of securingthe general objectives that underlay a number of statutes Congress passed tosupport military procurement and national defense.

o Majority Noted that Congress had passed a number of other laws R eason he didn t pursue action under the T aft-Hartley Act is because

injunction would ve taken time and it only lasts 8 0 days y A lso, in enacting T aft-Hartley the seizing of a plant was actuallyconsidered and rejected by Congress.

S elective S ervice Act Didn t act under this because he d have to wait for the strike to actually happen.

o Important because it shows President directing an agency to do something o J ustice J ackson Doctrine

Greatest Power Zone of Twilight Weakest PowerPursuant to Congress is silent; P OT US

is out there and doesn thave clear statutory

authority

PRESIDENTS USE OF EXECUTIVE ORDERSy No formal definition of an Executive Order y W here the Framers, Congress and the Supreme Court have failed to act, an Executive

Order is an important official set of directions to the whole or a part of the bureaucracyconcerning the organization and conduct of their business.


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y First executive order issued by President L incoln.y Proposed Executive Orders are first submitted to and analyzed by the OM By Used mainly for internal purposes within the agencies, but sometimes affect private

parties.o Sometimes used in place of legislation.

y Executive Order Exampleso If you are the recipient of a Government Contract, then you have to adhere to

certain requirements for hiring and complying.o President Carter in the 70s

y

PRESIDENTIAL/EXECUTIVE BRANCH OVERSIGHT OF ADMINISTRATIVEACTION

y Focus is O ffice of Management and Budgety Most of them are in the West W ingy The growth of the OM B

o Split government can t get anything doneo The increase in the number of agencieso To ensure well-reasoned regulationso When agencies are captive of the people that they re regulating.

They hear from the same people all the time and they re looking for newideas.

So that agencies would look more broadlyy President Carter wanted simplicity, clarity, and cost-effectivenessy President R eagany President Bush H. W . vested the Task Force role in the President s Council on

Competitiveness

Environmental Defense Fund v. Thomas (DDC 1986) y Congress enacted the Hazardous and Solid Waste Amendments of 1984y This was for standards for inspecting underground tanksy They send this over to the OM B for review and they sit on it and the EPA regulations

were delayedy It was clear that OM B had serious differences with EPA over what regulations to proposey The court didn t issue an injunction. They said that you can t prevent the OM B from

reviewing things because you think that they re going to take too long.y The Court issued a declaratory judgment explaining that the amount of time in delay is

unacceptable.

TAKE AWAYSy The difference between private and public rights


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o What factors courts have considered in holding adjudications of differentagencies

Whether statute gave Statutory delegation of adjudicatory powers endangers the role that

was prescribed to the courts/agencies

Whethero Where we can look to find outy Can determine whether the agencys adjudicatory powers will be upheld if there is a

close connection between private and public rights or some other matter over whichthe agency has jurisdiction

y Efficiency is sometimes a consideration.y A waiver by a litigant who could go to the state or local court and decides instead to

go through an agencys adjudicatory processy Ultimately, if the agency adjudication doesnt work out that party may be able to go

to court to seek redress.


AD J UDICATORY DUE PROCESS & ELEMENTS

DUE PROCESS y O fficial source of Due Process is located in the 5 th Amendment

o No one may be deprived of life, liberty or property without Due Processy Later incorporated to the States by way of the 14th Amendmenty Starr Chambers

o Secret proceedings that took place in a Chamber in Westminster o No juries, no right to appeal, very oppressive and arbitraryo E liminated in 1641

y Two Types of Due Process o Procedural How these rights are protected and what kinds of procedures are

necessary and should be there to insure that no one is deprived of life, liberty or property

o Substantive Specifically concerns the types of rights that are protected,focusing on the reasons why different types of rights cannot be infringed upon.

y Three Approaches Taken by Courtso The Traditional Approach

Whether the procedures at issue conform to the customary processes of law.

Weakness lies in the difficulty of identifying a single appropriate tradition Strengths Can rely on legitimacy and predictability. A lso preventsCourts from skewing a decision.

o The Natural Rights Approach Concerns the types of rights should be given to people to preserve human

dignity V ery subjective and too individualized

o The Interest Balancing Approach


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Balances the interest of the individual against the impact and effect on theGovernment.

Three-Part Test ( Mathews v. Eldridge ):y Magnitude of the interests of private partiesy The governmental interest in procedural efficiency

o If 1 of the 11 due process requirements is left out for efficiency purposes, will there be a miscarriage of justice?y The likely contribution of various procedural ingredients to the

correct resolution of disputes.

G oldberg v. Kelly (S. Ct. 1970)y A federal program of welfare aid to families with dependent children that is administered

by the state and local agencies.y The government determined that K ellys eligibility was cut-off for some reason and told

her after-the-fact that her check would not come.y At this time there was no procedure for giving somebody notice or a right to be heard

before the benefits were cut-off y K ellys landlady turned her in because she suspected that there were more people

becoming part of the family that were not registered, but contributing income andfinancial support.

y Even if someone s benefits were terminated and it was determined that a mistake hadbeen made, there was no rule or procedure governing or allowing for retroactive paymentof funds.

y First a caseworker would investigate the recipient s eligibility and if the C W concludesthat the recipient is no longer eligible, he would recommend termination of aid to asupervisor. If the latter agrees, he sends a letter to the recipient stating the reasons for proposing to terminate aid and notifying the recipient within 7 days that he may requestreview of the record by submitting a written statement

y If the reviewing official affirms the determination of ineligibility, aid is stoppedimmediately and the recipient is informed by letter of the reasons for the action.

y Supposing that the welfare recipients had a right to challenge the decision, theirsocio-economic status may preclude them from being able know or exercise theirrights.

y Main Issue That the benefits were terminated after-the-fact y Court said that a pretermination hearing was critical but also that the following were

crucial:o A complete record and a comprehensive opinion that would serve primarily to

facilitate judicial review and to guide future decisionsy Applying the Three-Part Test

o The individual interest was at its highest because this money was needed for sustenance.

o The Court definitely found that the survival risk to the family dramaticallyoutweighed the State s interest in not having to pay welfare benefits in this onecase.

Mathews v. Eldridge (S. Ct. 1976) y This case was distinguished from Gol d ber g


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y There was no economic test for disability all you had to show was that you suffered aninjury. There wasn t evidence, and you didn t have to prove, that you were in a diresituation.

y The evidence in the Gol d ber g case that caused K elly to lose her benefits was theassumption of her landlady. In this case, the evidence is clearly indicated in the medical

records of the claimant.y If he was found to have improperly lost his benefits, he would have the opportunity to

obtain them retroactively. This was not the case in Gol d ber g .y Finally, it wasn t clear that the claimant s condition/need was so great that it justified the

imposition of additional or substitute procedural requirements on administrative agencies.y If you spend such a great deal of money on court costs, it would take away from the

money that could otherwise be spent on actually giving people benefits.o Make the standards and the process for demonstrating eligibility much more

difficult.y If the need isnt dire and the person isnt in a critical situation then sometimes the

scale has to tip the other way which is justified by the fact that you could do more

for more people.

ELEMENTS

TIMINGy W hat type of notice is required?y How far in advance is notice required?

H amdi v. Rumsfeld (2004)


EQUAL PROTECTION y Two spectrums

o A specific definition of a life, liberty or property interest (narrow approach)o A wide-open approach might be too broad a method for defining the life, liberty

or property interest (broad approach)y Early cases that we did read (important)

o B imetalic I nvestments Someone deprived of property by a governmental rule across the board Dealt with property tax. Same tax was applied to every property owner. Why don t they get a hearing?

y If its a legislative decision by something like a local city councilthen they have the ability to change the rule by a vote or throughan open meeting

Held not to be a liberty right that entitled someone to a due processhearing or a partial trial.


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o Londoner v. Denver Legislative decision to pave streets in a particular neighborhood There wasn t a formula to determine how much each individual landowner

or group needed to pay There it was found that due process was required because it was an

individual decision and not a decision across the board.y Liberty and Property jurisprudence

o Sometimes the decisions aren t completely consistent and the courts arepersuaded by different things.

o The rules are complicated and the courts struggle between being fair and beingcorrect.

o Look for the context Battlefield or school-setting? Different weighing of factors by trying to be fair and trying to be rational

o Look for common fact patterns Common themes

B ailey v. Richardson (DC Cir. 1950) y Bailey had been dismissed as a training officer with the formal Federal Security Agency

based on a determination by the Loyalty R eview Board that there were reasonablegrounds to regard her as disloyal to the United States.

y The Supreme Court said that holding a government job was not a significant propertyinterest.

Cafeteria & Restaurant Workers Union v. McElroy (1961) y Short-order cook at a cafeteria operated on the premises of a naval gun factoryy Plaintiff was treated even more unfairly than Ms. Baileyy She was asked to turn in her ID badge b/c Lieutenant Commander determined that shehad failed to meet the security requirements of the installationy The Supreme Court held that the governmental function operating here was the power, as

proprietor, to manage the internal operation of an important federal militaryestablishment. In that proprietary military capacity, the Federal Government, as has beenpointed out, has traditionally exercised unfettered control.

y The Court said that she could still be a short-order cook, just not at that specific cafeteria

G reene v. McElroy (1959) y Held that the DoD had wrongfully revoked the security clearance of an aeronautical

engineer, resulting in his discharge by his government contractor employer y The Court found that neither Congress nor the President had delegated authority to the

DoD to terminate contractor security clearances without a hearing.y Petitioners work opportunities have been severely limited on the basis of a fact

determination rendered after a hearing which failed to comply with our traditional ideas of fair procedures.

B oard of Regents of State Colleges v. Roth (1972)


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y Facts: R oth was hired for one year, and had no tenure rights to continued employment,nor statutory rights. Under W isconsin statute, a State university professor could acquiretenure as a permanent employee after four continuous years of employment. R oth wasnotified by the President of the University that he would not be rehired for another year,but no reason was given, nor any method for review or appeal. R oth brought an action

claiming that he had a constitutional right to a statement of reasons and a hearing on theUniversity s decision not to rehire him for another year.y Issue: Was the University required to give R oth a statement of reasons and provide him

a hearing under the Fourteenth Amendment?y Held: No. R oth was not deprived of liberty or property protected by the Fourteenth

Amendment. The requirements of procedural due process apply only to the deprivationof interests encompassed by the Fourteenth A mendments protection of liberty and property. The State, in declining to rehire Roth, did not make any charge against himthat would harm his reputation; nor did it preclude him from obtaining other employment. It stretches the concept too far to suggest that a person is deprived of liberty when he simply is not rehired in one job but remains free as before to seek

another.y Dissent: Justice Douglas: Nonrenewal of a teacher s contract, whether or not he has

tenure, is an important interest entitled to due process. Justice Marshall: The right of every citizen to work is a property right and a liberty- liberty to work- which is thevery essence of the personal freedom and opportunity secured by the FourteenthAmendment.

y Discussion: All that the University did was decide not to rehire R oth for another year.A lthough R oth had an abstract interest in being rehired, he did not have a propertyinterest sufficient to require the University to give him a hearing when they decided notto renew his contract of employment

Notes on Roth y There is an argument that he could ve known that he was limited to a one-year contract tobe renewed or terminated at the end of the contracty District Court applied a balancing test and held that his interests in continued

employment outweighed the University s interest in denying him re-employmentsummarily.

y Supreme Court said that you shouldn t consider the weight of the party s interest beforeyouve considered the type of interest at stake.

o Court determined that this was not a liberty interest.o Court found that there was no derogatory information that would have impaired

his future employment prospects If it had, they would have deemed there to be a deprivation of his

property interest.o The terms of R oths employment were very direct about the fact that there was no

guarantee to reemployment after a year. If there had been some statement then that would ve changed everything.

Perry v. Sindermann (1972)


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y Synopsis of Rule of Law: A person s interest in a benefit is a property interest for due process purposes if there are rules or mutually explicit understandings that supporthis claim of entitlement to the benefit and that he may invoke at a hearing.

y Facts: The State of Texas did not have a formal tenure system in place, but did have anofficial Faculty Guide that R espondent claimed established a de facto tenure system.

R espondent claimed legitimate reliance that employment for seven years or more at hisparticular college created some form of tenure that was no less a property interest than aformal tenure system at another university. The District Court granted summary judgmentagainst R espondent.

y Issue: Did R espondent s lack of tenure or contractual right to re-employment, takenalone, defeat his claim that nonrenewal violated his First and Fourteenth Amendmentrights? Did R espondent have de facto tenure, sufficient to afford him procedural dueprocess?

y Held: No. The grant of summary judgment against R espondent was improper. A teacher,like the R espondent, who has held his position for many years, might be able to showfrom the circumstances of his service and other relevant facts that he has a legitimate

claim of entitlement to job tenure. Proof of such a property interest would obligatecollege officials to grant him a hearing at his request, where he could be informed of thegrounds for non-retention and challenge their sufficiency.

y Dissent: The District Court should be directed to enter summary judgment for respondent entitling him to a statement of the reasons why his contract was not renewedand a hearing on the disputed issues of fact.

y Discussion: Although the Texas college system had no formal tenure program, itsguidelines and standard practices, coupled with the length of R espondent s employment,were sufficient that an entitlement could be found to procedural due process.

Cleveland B d. of Education v. Loudermill (1985)

Brief Fact Summary: A State Board of Education fired an employee, without first giving him ahearing, for lying on a job application. Under Ohio law, the employee could only be terminatedfor cause. R espondent challenged the constitutionality of the termination procedures.

Synopsis of Rule of Law: W hile a State may elect not to confer a property interest in publicemployment, it may not constitutionally deprive one of such an interest, once conferred, withoutthe appropriate procedural safeguards.

Facts: The Cleveland Board of Education (the Board) hired R espondent, James Loudermill, asa security guard. On his job application to the Board, R espondent stated that he had never beenconvicted of a felony. In fact, as the Board later discovered, he had been convicted of grand

larceny. As a result, the Board informed R espondent by letter that he had been dismissed fromhis job for lying. R espondent was not given the opportunity to challenge the charge of dishonestyor the dismissal. Under Ohio law, R espondent was a classified civil servant, which meant thathe could only be terminated for cause and with the opportunity for administrative review.R espondent challenged the Board s termination procedures under the United States Constitution.

Issue: Was the pre-termination process afforded R espondent in accordance with Due Processunder the Fourteenth Amendment to the United States Constitution?


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Held: No. The lower court s rulings requiring a hearing before termination are affirmed.J ustice White : R espondent s dismissal amounted to a violation of his Due Process rights under the United States Constitution. The Due Process Clause of the Fourteenth Amendment contains asubstantive and a procedural component. As such, the clause forbids the government to deprive a

citizen of life, liberty or property without affording the citizen certain procedural safeguards. Therights to property that citizens have, which cannot be taken away without such safeguards(substantive rights), can be created by State law. The procedural requirements that must be metto constitutionally deprive a citizen of her rights to property may also have their dimensionsdefined by existing rules or understandings that stem from State law.Under Ohio law, R espondent was a classified civil servant. By law State law, such employeescould only be terminated by cause and with a pre-termination hearing. Therefore, sinceR espondent was conferred a right to employment by State law, and R espondent was deprived of his right to employment without a pre-termination hearing, the government unconstitutionallydeprived R espondent of his right to property under the Fourteenth Amendment Due ProcessClause of the Constitution.

Dissent: J ustice Rehnquist : We ought to take into account the totality of a State s definition of aproperty right. The employee s statutorily defined right is not a guarantee against removalwithout cause in the abstract. R ather, it is a guarantee as enforced by the procedures the Ohiolegislature has designated for the determination of cause.

Discussion: This case provides an example of a common fact pattern wherein the rights andprotections accorded a citizen under the United States Constitutions depends on the rights andprotections she has been accorded under some other source of law. Ordinarily, the other sourcewill be a State law or local ordinance.

NOTESy The Court said that Loudermill had a right to a pre-termination hearing, but that it need

not be elaborate.


Take Awaysy Ham d i v. Rumsfel d as different type of case (on battlefield, employee of US, etc., )

o There was reduced Due Process because of the circumstances.o M ilitary may view it as a problem to give him DP, but if he is innocent then it s a

deprivation of his human rights Wasnt just a denial of contractual rightsy Due Process Interests.

o Traditional Property R ights v. Moderno Distinguish difference between across the board deprivation that applies to tons of

people as a matter of legislative rulemaking vs. the deprivation of property to anindividual (i.e., loss of property, can t use property in the same way, indiv. againstthe system).


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o R ecognize the sources of protected interests Constitution Statute T enure Cases Guidebooks, statements, policy

o Familiarity with defining types of deprivation

Govt. vs. private employer Actual employment vs. potential employmento Indirect Types of Deprivation

S hort Or d er Cook Case y Govt. didn t deprive her of her job, they just told her that she can t

get access to the military base with her cardo Deprivation of L iberty

Ham d i v. Rumsfel d R ebellious teenager forcibly sent to rehab place without proper DP Something that makes it difficult, if not impossible, to find future

employment

GOALSy Understanding alternative sources of hearing rightsy W hat the APA requires

SOURCES OF HEARING RIGHTS y Constitutiony Statutes

o Provide the primary starting point for hearing rights in Federal Programs APA only covers hearing rights in federal programs

o Ad ministrative Proce d ure Act

Formal procedures are available for both rulemakings and adjudications(two sections) The process is only available when some other statute says it is. A decision determined on the record after opportunity for agency

hearing y These are the words that you have to have in another statute in

order to be afforded DPy Sometimes Congress affords hearing rights without the magic

words, but if so, the language will be stronger in favor of ahearing.

o Congress almost always provides for hearing rights when authorizing programs of

adjudicatory decision making that implicate constitutionally protected liberty or property.o When Congress creates hearing rights, it generally prescribes their features in

sufficient detail to meet any plausible due process minimum.

o Even though he had a right to a hearing after termination, the Court said that wasnot sufficient enough for Due Process.

y A gency Regulations


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SCOPE OF THE HEARING FROM EACH SOURCE

y Does the statute authorizing the agency s decision require any hearing?y If so, does it require that the decision be determined on the record after opportunity for

an agency hearing within the meaning of the APA (magic words)y If so, does the agency s statute modify or add to the procedural elements that the APA prescribes?y If a hearing is required, but APA requirements are not triggered, then you look to the

specific agency regulations

United States v. Florida East Coast Railway Co. (1973) Decision Establishes Two K ey Points

y Establishes the process for when there is a required hearing, but the magic words aren tused.

y The importance of a more formal, elaborate hearing is greater in the adjudicatory contextrather than the rulemaking context because in the latter, a larger group of people likely

have other means of obtaining fair process.Facts of Case & Decision

y Shortage of railroad cars in the US was having an adverse effect on the economyy W hen one company didn t have enough rail cars, they would borrow from another

company, but many failed to return the carsy The ICC (no longer exists) conducted an investigation and initiated a rulemaking that

said, maybe if people had to pay to borrow the cars or get money for returning the cars,then they would be more diligent in returning the cars.

y Difference between rulemaking vs. adjudication o Here it applies across the board rather than to one railroad company in particular

y Said that the ICC left the railroads with the impression that there would be another chance for the railroads to come in and add their input.

y ICC allowed the railroads to submit written objections, but the ICC went ahead andoverruled all of the hearings without any exceptions.

y Statute (1) required a hearing, but (2) didnt use the magic words o For a formal oral hearing, Congress really requires that you use the triggering

languageo If what people want is a formal hearing with a trial type process, then you need to

have that triggering language.y If you re dealing in a rulemaking context vs. an adjudicatory context, there is a

presumption that the hearing requirements don t need to be as formal.y In adjudications, generally looking at facts that have already happened (not prospective

like rulemaking)

THIRD-PARTY RIGHTS y Sometimes a 3 rd party can force or expand a hearing even if they re not a party to the

hearing (i.e., public interest groups, non-profit organizations).


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o (1) Usually a public interest group o (2) A lot of statutes provide for it

ELEMENTS OF ON-THE-RECORD AD J UDICATIVE PROCESS (APA) y I nitiation

o

Some type of noticeo What the matters of fact and lawo M ight be the case that you don t need to go through the elaborate adjudication

process if the parties can settle.y I nformal Settlement

o y I nitial Decision Maker y Exclusivity of Record; Ex-Parte Contacts y Separation of Functions y A ppearance of Parties and Other I nterested Persons y Discovery y Evidence and Rules on Proof y The Product of the H earing y A dministrative A ppeals

*** The Constitutional right to Due Process for loss of property when that right is a job,your right to a hearing is much stronger if your employment is with the Government.

Richardson v. Perales (1971) Facts: In 1966 Pedro Perales, a San Antonio truck driver, then aged 34, height 5' 11" , weightabout 22 0 pounds, filed a claim for disability insurance benefits under the Social Security Act.Judicial review, as noted in the statute relates, "The findings of the Secretary as to any fact, if supported by substantial evidence, shall be conclusive . . . . " Perales was a truck driver who was injured on the job.

Pedro Perales had claimed he had received a back injury by lifting an object at work. Some of hisdoctors were unable to find an objective neurological explanation for his continuing pain. Hisdoctors ' medical reports were submitted to the state Division of Disability Determination, whichordered a consultative examination, which was unfavorable to him. At an agency hearing, theDivision had called an independent "medical advisor ", Dr. Leavitt to assess the medical reportsfrom M r. Perales ' doctors. Dr. Leavitt did not examine Perales but stated that the consensus of the medical reports was that Perales had suffered an impairment of only mild severity. TheDivision denied Perales ' claim for disability benefits.The issue here is whether physicians ' written reports of medical examinations they have made of a disability claimant may constitute "substantial evidence " supportive of a finding of nondisability, within the 2 05 (g) standard, when the claimant objects to the admissibility of thosereports and when the only live testimony is presented by his side and is contrary to the reports.Perales injured his back and subsequently had lumbar spinal surgery. He was deemed to havehad a successful result by his physician and others who reviewed his case. Perales contended thesurgery had been unsuccessful, in that he was unable to return to work. He presented an opinionfrom a physician confirming the belief that he was unemployable. Despite this, the


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administrative hearing found that he was not eligible for Social Security Disability. Perales didnot subpoena the doctors who had written unfavorable reports and cross examine them in thecourse of his hearing, despite having the opportunity to do so. Later, he claimed this failure, onhis part had denied him of a fair hearing, and hence claimed a violation of his constitutional rightto due process.

Issue: W hether physicians written reports of medical examinations they have made of adisability claimant may constitute substantial evidence supportive of a finding of nondisability,within the meaning of the Social Security Act, Section 2 05 (g), when the claimant objects to theadmissibility of those reports and when the only live testimony is presented by his side and iscontrary to the reports.

Discussiony Section 2 05 (d) of the Act, provides that the Secretary has power to issue subpoenas

requiring the attendance and testimony of witnesses and the production of evidence andthat the Secretary s regulations, authorized by Section 2 05 (a), provide that a claimant

may request the issuance of subpoenas.o It may have been the case that Perales attorney chose not subpoena anytestimony of experts because of the information in Perales medical report


y Different agencies face very different issueso Some agencies face thousands of adjudications each year o Some agencies are more focused on preventing the dispositions from individual

cases from altering the agencies policies y

A ll of the agencies have to deal with balancing the substantive goals vs. theadministrative burdens that they re faced with.

AGENCY TOOLS FOR DEALING WITH AD J UDICATORY ISSUES y Hierarchical control through the enunciation of precedents has been largely unsuccessful

o There are thousands of cases to be decided each year o AL Js cannot be expected to retrieve and follow a decisional output this sizeo Cases are highly fact-based which makes stare d ecisis almost impossible

MIDTERMy Look at the Take-Aways from class y Pay attention to the cases and what the decisional points were in the facts. M idterm willhave similar fact patterns.

Take Aways y

N ash v. Califano (1980)


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y Nash made some suggestions and urged adoption of a number of administrative reformsto cope with the mounting backlog of cases before the Bureau of Hearings and Appeals.

y Director Trachtenburg instituted many of the reforms that Nash suggested y Nash, however, alleges that appellees and their staff employees have interfered with the

decisional independence of the administrative law judges in violation of the APA, the

SSA and the Due Process Clause of the 5th

Amendment y District Court dismissed for lack of standingy Court of Appeals

o Under the APA, the AL Js are entitled to pay prescribed by the OPM independently of agency recommendations or ratings

o AL Js may not be removed without formal adjudication (unlike other civilservants)

o Noted that the AL Js received mandatory, unlawful instructions regarding everydetail of the judicial role

Therefore, Nash has the personal stake and interest that impart theconcrete adverseness required by Article III

H eckler v. Campbell (1983) Facts: The R espondent applied for disability benefits in 1979 because a back condition andhypertension prevented her from continuing her work as a maid. Her application was denied andshe sought a hearing before an administrative law judge who concluded that though she could nolonger work as a maid due to her back condition, but she could nevertheless perform light work.The R espondent s claim was thus denied. On appeal, the Second Circuit reversed on the groundsthat the Health and Human Services (HHS) guidelines were inadequate as evidence of aclaimant s ability to perform a specific alternative occupation. Seeking review, the Petitioner argued that the court of appeals holding effectively prevented her use of the medical-vocationalguidelines by requiring her to identify specific alternative jobs in every disability hearing. The

Supreme Court of the United States (Supreme Court) granted certiorari.

Issue: May the Secretary of HHS rely on medical-vocational guidelines to determine aclaimant s right to Social Security disability benefits?

Held: Yes. The Supreme Court held that the court of appeals erred in reversing the judgmentbecause the Petitioner s use of the medical-vocational guidelines to determine a claimant s rightto disability benefits did not conflict with the Social Security Act, nor were the guidelinesarbitrary or capricious.

Dissent: Justice Thurgood Marshall (J. Marshall) in dissent, echoes the concern of Justice

W illiam Brennen (J. Brennan) regarding the additional question whether the AdministrativeLaw Judge fulfilled his obligation to look fully into the issues. J. Marshall further expressesconcern with regard to claimant s due process rights. Specifically the principle of administrativelaw that, when an agency takes official or administrative notice of facts, a litigant must be givenan adequate opportunity to respond a requirement the majority held as inapplicable where, as inthis case, the agency has promulgated valid regulations.


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Concurrence: J. Brennen, while concurring in the judgment, nevertheless had reservationsconcerning the thoroughness with which the Administrative Law Judge carried out the obligationto scrupulously and conscientiously explore for all the relevant facts in connection with aclaim as an integral component of a claimants basic statutory and constitutional right to dueprocess in the adjudication of their claims.

Discussion: In Heckler, the Supreme Court takes the opportunity to clarify the purpose andapplication of the statutory framework surrounding Social Security disability benefits. J. Lewisstated, The Social Security Act defines disability in terms of the effect a physical or mentalimpairment has on a person s ability to function in the workplace. It provides disability benefitsonly to persons who are unable to engage in any substantial gainful activity by reason of anymedically determinable physical or mental impairment. And, J. Powell adds, the Social SecurityAct specifies that a person must not only be unable to do his previous work but must be unable,considering his age, education, and work experience, to engage in any other kind of substantialgainful work which exists in the national economy, regardless. He clarifies, of whether suchwork exists in the immediate area in which he lives, or whether a specific job vacancy exists for

him, or whether he would be hired if he applied for work. W ith regard to the standard of reviewincumbent on the HHS Secretary, J. Powell notes, The Social Security Act directs the Secretaryof Health and Human Services to adopt reasonable and proper rules and regulations to regulateand provide for the nature and extent of the proofs and evidence and the method of taking andfurnishing the same in disability cases. Further, While the statutory scheme contemplates thatdisability hearings will be individualized determinations based on evidence, this does not bar theSecretary from relying on rulemaking to resolve certain classes of issues. In short, where theagency has promulgated valid regulations, both policy and efficiency permit the HHS secretaryto rely on such regulations. As the Supreme Court noted, The determination as to whetherjobs exist that a person having the claimants qualifications could perform requires theSecretary to determine a factual issue that is not unique to each claimant and may beresolved as fairly through rulemaking as by introducing testimony of vocational experts ateach disability hearing.

Notes y The evidence prevented Campbell from putting on evidence


Take Awaysy Richardson v. Perales

o The facts and reasons that the court used to uphold certain requirementsy Federal Government tactics for efficiency and effectiveness in agency adjudication

o Managing AL J so Controlling agency action through rulemakingo Avoid agency action through rulemaking

y Be familiar with the 3 cases that concerned the 3 tactics aboveo N ash v. Califano


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y What courts consider when evaluating agency adjudication. How far the agency cango Independence, quality, etc.,

A ir Line Pilots A ssn v. Quesada (2nd Cir. 1960) y FAA was concerned following incidents of pilot error and safety considerations.y FAA was subject to a statute that required that any suspension of pilot s license bethrough a hearing.

o Because of the large number of pilots, the FAA adopted a regulation mandating aset retirement age.

Not very popular among airline pilotsy Pilots took it to court on Due Process grounds.y The Court upheld the regulation as appropriate. Even though it may have been less fair

to the pilots, the public safety consideration trumped Plaintiffs claimsy Aftermath of the case was very unpopular.

o Airline pilots lobbied the FAA and said if you agree that every pilot above 6 0 isnot of this type for which the rule was drafted, then you should have exemptions.

FAA developed the over 6 0 pilot s exemption but never enforced it. Airline pilots got Congress to increase the laws age limitations from60 to 65.

y One of the ways to make a law fair and more equitable without having to repeal it,Congress sometimes makes/adds to a list of exceptions.

RULEMAKINGy Process is much more open, whereas the APA tries to insure independence.y The Constitution doesn t say anywhere that agencies are authorized to do anything.y Statutes are the most important starting point for agency rulemaking

o Sometimes exercise quasi-legislative power and quasi-judicial power y Prior to 19 46, agencies adopted procedural rules.y Substantive rulemaking was much less clear there was a lot of disagreement that led to

Court proceedings.y FT C had to follow a 7-step process when confronted with deceptive or unfair trade

practiceso Complainto Determine whether the Complaint had legso Have a hearing in which they had to prove that a significant number of consumers

had been deceived by the practiceo Whoever was accused of partaking in the deceptive practice then had an

opportunity to present evidence that it was not a deceptive practice Had the power to cross-examine

o Next it went to AL J for a decisiono The Commission took the AL Js decision and filedo The final step is a process for an appeal

y If you have an adjudication, you re making a decision based entirely on one set of facts.However, if you have a rulemaking, then you will get much more diverse and widespreadopinion. You will get much more/better data.


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y A rulemaking is far more open than an adjudicatory proceeding.

TWO TYPES OF RULEMAKINGS (Baseline in the APA) y Informal Rulemakings 553

o Agency can rely entirely on written input onlyo R ecord Published rules only have to incorporate concise statement of purpose of the ruleo Usage Used much more frequently

y Formal Rulemakings 556, 557 o More of a trial type with oral evidenceo R ecord o Usage Used very infrequently.

y Both Formal and Informalo Notice requirementso Participation right with or without a hearing/oral presentationo M inimum factors that includes concise formal statement of the ruleso Publish in Federal R egister

N ational Tire Dealers & Retreaders A ssn, I nc. v. B rinegar (DC Cir. 1974)y Secretary of the Do T adopted standards regarding tiresy Secretary added that it had to be permanently affixed and that it had to be placed in a

certain place on the tire.y T ire retreaders didn t like the rule because it was expensive and difficult to implementy At Court they attacked the findings supporting the permanent labeling in the additional

languagey Issue: What relation permanent labeling has to avoidance of those hazards y The Court remanded and said that the agency could re-issue that same regulation if they

went back and changed the language with more of a basis to support the law.y This case demonstrates that the courts are more willing to scrutinize an agencys

determination as to what should be in a rule than what Congress determines shouldbe in a rule.

o Congress is authorized to legislate by the Constitution (separation of powers) o Agencies lack accountability. Congress represents the will of the people.

y WARNING o Even though the APA says that you can get by with a concise statement, these

decisions show that an agency has to have more than that.o Need to be aware that the court is going to be looking for a little bit more than just

that concise general statement.

Motor Vehicle Manufacturers A ssn v. State Farm Mutual A utomobile I ns. (1983)


TAKE AWAYS


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y Difference between formal and informal rulemakingsy Necessary baseline elements in formal rulemakings

o Notice published in the register o Opp. for participationo Decision that considers all the relevant factors that includes a concise general

statement of the rule thats adopted O ftentimes you re expected to have more than that concise generalstatement

o Has to be published in the Federal R egister y Even if a rulemaking meets the baseline, Congress can add to that formal rulemaking

with the addition of an informal rulemaking.o More than what an enabling statute might impose on an agency

y May have more difficult or comprehensive procedures than what the APA requires.

Class Goals y Look at some rulemakings and identify what s missing

o One way to tell what is done wrong is to look at agency rulemakings that havebeen challenged.

FORMAL RULEMAKINGS

The Standard y Arbitraryy Capriciousy Abuse of Discretiony Not in Accordance with the Law

Grounds for Challenging Agency Rulemakings y The agency didn t abide by procedures set forth by lawy Act in excess of a statutory authority that est. limitationsy The Constitution

o If the agency manages to make rules contrary to the Constitutiono This is rare

Rulemaking Elements y If they haven t observed the proceduresy Not supported by substantial evidence

United States v. N ova Scotia Food Products Corp. y Shows the linkage between the agency s rulemaking and the review of the court y Issue is whether the rule for processing a type of fish can be enforced y The type of illness (Clostridium Botulinum) is rare in this fish and this came to the

FDAs attention because someone complained . o Sometimes the FDA will go into a facility and catch somebody randomly or they

will go in based on someone s complaint.


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o R outine inspections are a common way of catching agencies that violate theseprocesses.

y The company knew about these rules but they realized that they couldn t sell the fish if they complied with these rules.

y FDAs Rulemaking Processo This is an informal rulemaking they didn t let the public know about theresearch that they had done, so the public couldn t rebut the research. o They were considering scientific research, but there was no opportunity to be

tested because the public didn t know. o The FDA Commish solicited comments from members of the industry, as well as

the Bureau of Commercial Fisheries of the Dept. of Interior That Bureau objected to the general application of the T-T-S requirement

proposed by the FDA on the ground that application of the regulation toall species of fish being smoked was not commercially feasible

Proposed doing it on a species by species basis. o They ended up not paying attention to something that turned out to be a very

relevant factor.y I n the statement of purpose, the FD A noted that they had not tested this procedure on

all species of fish.y Case first went to the District Court which UPH ELD the rule and then they appealed it. y COA was not willing to accept district court decision/ FDA process

o FDA did not disclose the scientific data o FDA did not keep a contemporaneous record

R elevant because of accuracy liabilities and because judicial review HASTO BE ON THE WHOLE RECORD

THINGS AGENCIES CAN DO BEFORE ISSUING A PROPOSED RULEMAKING

1. Hold Public Hearingsa. Have people come to Washington or go around the country and allow people tofeel that they are more a part of the process.

i. A dvantages1. A llows agencies to anticipate problems in specific areas2. May come up with something that wasn t thought of

ii. Disadvantages1. Causes delay2. Unrealistically raises people s expectations

2. Advanced Notice of a Rulemaking a. Basically the same advantages and disadvantages

i. A dvantages 1. A llows for technological information in advanceii. Disadvantages

1. May not get a good cross-section because activists and publicinterest groups will chime in

3. Federal Advisory Committees a. They are there to help the agency and move them along/provide them with

feedback regarding a proposed rule.


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4. E-Rulemaking a. More widely available to more peopleb. Used to have to go to the Federal R egister to get a copy.

EX-PARTE COMMUNICATIONy

When an agency is meeting with one side, one person, one group, etc., and the other people that have an interest in the issue are not present and do not have an input. y Compared with an Adjudication

o In an adjudication , its much more damaging for the judge only to meet with oneside because so few people are involved.

o In a rulemaking , it affects a large number of people so it s not AS big a deal as itis in an adjudication

y To prevent this it has to be a part of the record.y Many agencies have specific procedures for what you re supposed to bring, etc., y The Benefits of Meeting W ith People

o Good to build a relationship with someone for the future.

AFTER ISSUING A RULEMAKING y Need to have a forum for commentingy Easiest thing is to have an issue/comment forumy If the agency and its staff are going to have a final meeting on something it s very

important to be careful regarding with whom you meet.y You are always best off if you follow what the agencys procedures are.

ISSUES THAT ARISE OUT OF INTER-AGENCY NEEDS y Sometimes the people that are meeting behind closed doors are not from the outside, but

rather from a different agency.y W hen you have other government officials who want to have a meeting. Someone else

that is affected by the rule-making.

Sierra Club v. Costle (DC Cir. 1981) y Two Stakeholders

o Proponents of environmental regulationso Companies that violate these regulations

y The Clean Air Acto Adopted very detailed rules and set up standards in advanceo Went into very specific requirements regarding agency rulemaking

Take Aways y In the cases above there was a flawed regulatory process that resulted in a commercially

unfeasible application

FOUR PITFALLS y FDA failed to consider a lot of important information that came in during the

consideration part. A lternative approaches raised that the FDA did not consider


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y There was a lack of a contemporaneous recordo As a result the staff had to scurry around after the fact

Lack of reliability no assurance that the record was completey The grand finale of any rulemaking is supposed to be a concise general statement and

the court found that statement entirely lackingy EX-PARTE CONTACTS

o K now what they are and how they re treated in an adjudicatory proceeding vs. arulemaking proceeding

o Different ground rules in a rulemaking proceeding depending upon whom the Ex-Parte contact is coming from

Coming from an outside agency, handled one way Coming from a legislature, executive, handled a different way

RULEMAKING

BIAS AN D CLO UDED JUD GM ENT

PRE- J UDGMENT CONTEXTS1. J udicial Proceedings

a. Not supposed to have any prior knowledge of the facts or independent contactwith the parties

2. Administrative Proceedingsa. The conflict is usually with the person that initiates the proceeding because it is

generally the same person that ends up making the decisioni. This is still permissible

b. If the head of the agency or the ultimate decision-maker has a known fixedopinion before they read the comments and made their decision then that is a pre-

judgment problem3. Agency Rulemakings

A ssociation of N ational A dvertisers, I nc. v. FTC (D.C. Cir. 1979) y Commission issued a notice of proposed rulemaking that suggested restrictions regarding

television advertising directed toward children.o Commission decided to propose a rule limiting children s advertising after

consideration of a staff report that discussed facts which suggest that the televisedadvertising of any product directed to young children who are too young tounderstand the selling purpose of, or otherwise comprehend or evaluate,

commercials may be unfair and deceptive within the meaning of Section 5. y ISSUE Whether or not the Commissioner pre-judged and has given the appearance of

having prejudged issues of fact involved in a fair determination of the Children sAdvertising rulemaking proceeding.

y TEST A Commissioner should be disqualified only when there has been a clear and convincing showing that the agency member has an unalterably closed mind onmatters critical to the disposition of the proceeding.


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*Take Aways

*

y Vermont Yankee v. N RDC o Important aspect of this case is to remember the that Courts cannot step in and

revise things within the power of the Executive or the legislature. y

EXCEPTIONS TO RULEMAKING y 553 Rule Makingy 553(a)

1. Does not apply to a military or foreign affairs function of the United States One reason for this is secrecy needs regarding matters of National Security

O ther reason is speed. Cannot afford to be held up by review2. A matter relating to agency management or personnel or to public property, loans,grants, benefits, or contracts.

You want the government to be efficient and get the best deal and if theyhad to take comments on every single thing that they wanted to buy or sell

Statute is called FA RR y Partial Exemptions

1. When notice or hearing is required by statute, the subsection does not apply to Interpretive R ules General Statements of Policy R ules of Agency Organization, Procedure, or Practice

y When an agency is doing something they would normally do inrule making but speed it up by calling it a procedural rule When an Agency for Good Cause finds that Notice and Public Procedure

are Impracticable, Unnecessary, or Contrary to the Public Interesty There is a safeguard. They have to put right in the rules when

theyre deciding to do this in a certain way, why they have decidedto dispense with notice and public procedure.

y Substantive Rule 30-Day Exemptions 1. A substantive rule which grants or recognizes an exemption or relieves a

restriction2. Interpretative R ules and Statements of Policy

3. As otherwise provided by the agency for good cause found and published withinthe rule.

y Agency Guidance Documents 1. A Formal Statement2. Addressed to a Partner in R egulation by the Federal Government3. Explain what the agency understands its statute or its regulations to require 4. K ind of advice usually given is what s known as a Safe Harbor


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Just what the agency views as compliance Helpful because they re theones that adopt and enforce the rule.

Can be very helpful as a starting point, but not always a certainty5. Examples

FAQ s

Circulars Guidelines Letter R ulings

J UDICIAL REVIEW OF AGENCY ACTIONy W hat are the Courts looking for? y Focusing less on the agency and more on the Court and what it is allowed to do. y Once you get to this part of the book, there are several points

1. Sometimes people get the misimpression that reviewing Courts are constantlyreviewing agency decisions and are doing it all the time and almost always set

them aside. The percentage of cases on agency decisions that go to the courtsare very low. There may be a lot of cases handled by the Court, but there issuch a vast number of agency decisions all the time.

2. The Court is not necessarily going to automatically overturn all agency rulings.When we start looking at the APA , you see that the permissible grounds for acourt to overturn a rule are very limited and specific.

y APA Gives Courts 6 Standards By Which Courts Can Overturn An Agency Actiono Arbitrary, Capricious, an abuse of discretion, or otherwise not in accordance with

the law o Contrary to Constitutional right, power, privilege, or immunityo In excess of statutory jurisdiction, authority, or limitations, or short of statutoryright o W ithout observance of procedure required by law

Cases where the agency didn t give notice Case where agency didn t give scientific evidence

o Unsupported by substantial evidence in a case subject to section 55 6 and 557 of this title or otherwise reviewed on the record of an agency hearing provided bystatute

o Unwarranted by the facts to the extent that the facts are subject to trial d e novo bythe reviewing court.

Citizens to Preserve Overton Park v. Volpe (1971) Brief Fact Summary . Two statutes enacted by Congress to curb destruction of the country snatural resources prohibited the Secretary of Transportation (Secretary) from authorizing the useof federal funds to finance the construction of highways through public parks if there was afeasible and prudent alternative route. The Secretary approved route I-40 being built throughOverton Park, and a group of citizens and conservation groups (Petitioners) contended that theSecretary violated the statutes.


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Synopsis of Rule of Law . A P A Section: 706 required the court to decide:

(1) Whether the Secretary acted within the scope of his authority;

(2) Whether the choice made was arbitrary, capricious, an abuse of discretion, or

otherwise not in accordance with law; and(3) Whether the Secretary s action followed the necessary procedural requirements.

Facts . I-40, the proposed six-lane highway, was to cut through Overton Park, a 342-acre citypark located near Memphis, Tennessee. The path of the road would sever the zoo from the rest of the park. Petitioners contended that the Secretary s announced approval of the road was invalidbecause he did not indicate why he believed there were no feasible and prudent alternativeroutes. In District Court, the R espondents argued that the Secretary did not have to make formalfindings, and introduced affidavits specifically prepared for litigation to support the Secretary sdecision. The District Court and the Court of Appeals held that formal findings by the Secretary

were not necessary, and refused to probe the mental processes of an administrative decision-maker. Believing the Secretary s authority wide and the reviewing courts narrow, they held thatthe affidavits contained no basis for a determination that the Secretary exceeded his authority.

Issue . Were formal findings required? Was judicial review based solely on affidavits adequate?

Held . R emanded to the District Court for plenary review of the Secretary s decision. No, formalfindings were not required under APA Section: 70 6. A finding based solely on affidavitsprepared for trial was insufficient. The review on remand was to be based on the wholeadministrative record that was before the Secretary at the time he made his decision.

Dissent . None.

Concurrence . (Labeled Separate Opinion) The Court of Appeals decision was wrong, but thecase should go back to the Secretary of Transportation, rather than the District Court, to holdhearings on the topic before making a determination

Discussion . This case pointed toward procedural requirements in informal adjudication that arenot specified in the APA. The United States Supreme Court was less deferential to agencyadministrators than the lower courts.


* TAKE AWAYS * y Vermont Yankee

o How a reviewing overstep its boundso Learn important principle that SC OT US established

Absent Constitutional constraints, extremely compelling


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y Know the exceptions to the rulemaking requirements in 553y Agency guidance documents as an exception to rulemaking

o Strengthso Drawbacks

y