Chapter 7
Part II
CBA for Oysters
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15 deaths a year
Worth treating all oysters and driving many small
houses out of business?
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Example - Court/Agency Conflicts in
Interpretation
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Portland wants to regulate broadband providers
Industry says they are telecommunications providers, thus not
subject to local regulation
 9th Cir Appeals Court agrees that only the FCC can regulate
them
FCC then promulgates a rule defining broadband providers as
information services, which can be regulated by the local
governent, in conflict with the appeals court
 What did the Appeals Court say?
 Did the United States Supreme Court agree that it was the 9th
Cir's call?
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Miller v. AT&T Corp., 250 F.3d 820 (4th Cir.
2001)
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The Family and Medical Leave Act (FMLA) does not
define medical treatment
 The agency finds that visits to the doctor that do not
require specific treatment are covered by the act
 What is the ambiguity?
Did the court accept the agency interpretation?
 What did the dissent want?
Why does this decision make practical sense?
 Think about going to the doctor for H1N1
 Are you going to get treatment?
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Opinions in Litigation
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Chevron was a rule making, with all the attendant
process and review
What if the agency takes a position for the first time
during litigation?
 Why might the court not trust it?
 Bowen v. Georgetown University Hospital, 488 U.S.
204 (1988)
Why might an amicus brief in case where the agency has
not interest get more deference?
 Auer v. Robbins, 519 U.S. 452 (1997)
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What Agency do you Defer to?
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While many agencies may have some
responsibilities under a given law, the court will
only defer to the agency with the primary
responsibility for administering the law
Why would it be a problem to defer to more than
one agency for the same statutory provisions?
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What if the question involves the
jurisdiction of the agency?
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Why might the court not defer?
Why might Scalia have argued that deference on
jurisdiction was as valid as any other area of
Chevron deference?
 Lower courts have agreed with Scalia
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Christensen v. Harris County, 529 U.S. 576
(2000)
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What did the court rule?
 “Here . . . we confront an interpretation contained in an
opinion letter, not one arrived at after, for example, a
formal adjudication or notice-and-comment
rulemaking. Interpretations such as those in opinion
letters--like interpretations contained in policy
statements, agency manuals, and enforcement
guidelines, all of which lack the force of law--do not
warrant Chevron-style deference.”
Why is this consistent with our definition of a guidance
document?
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When does Chevron Apply? - United
States v. Mead, 533 U.S. 218 (2001)
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Chevron was a notice and comment rule
 Why does the notice and comment process better
assure that an agency legal interpretation is sound?
Mead is letter ruling on the classification of a product for
tariff purposes (Daytimer calendars)
 No notice and comment, thus no vetting
 Can be changed at a latter date without notice and
comment - does not bind the agency
Should this letter ruling get Chevron deference?
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The Mead Test
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administrative implementation of a particular
statutory provision qualifies for Chevron
deference when it appears that Congress
delegated authority to the agency generally to
make rules carrying the force of law, and that the
agency interpretation claiming deference was
promulgated in the exercise of that authority.
What would you look for to decide if Mead
applied?
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Back to Persuasiveness? - Barnhart v.
Walton, 535 U.S. 212 (2002)
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Barnhart factors
 The importance of interpretation to agency policy;
 The period that the agency has held the view;
 The legal expertise of the agency;
 The complexity of the problem;
These are neither Mead nor Chevron, but ad hoc
What can the agency due to strengthen its case for
deference?
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Applying Barnhart
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HUD issues guidance on construction of the antikickback provisions in a real estate act
 Published in the register, but no notice and
comment
Are they binding under Barnhart?
 Yes, according to the Second and Ninth
Circuits; no, according to the Seventh Circuit.
 You are not the only person who is confused
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Public Citizen v. U.S. Dept. of Health and
Human Services, 332 F.3d 654 (D.C. Cir. 2003)
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Is the Medicare Manual a notice and comment
regulation?
 If not, what is it?
 Does this look more like Mead or Chevron?
Did the court find that the manual was a
regulation with the force of law?
How can the Medicare Manual be binding on
providers if it does not have the force of law?
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ABA Adlaw Conference 2008 - Justice
Garland, 2nd Cir, on Chevron:
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If you have an ambiguous statute, and need
Chevron deference, do not say that the
interpretation is clear and there is no other way to
construe the law. Say it is ambiguous and you are
making a reasonable interpretation based on your
knowledge of the statute and the regulatory
circumstances.
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Interpretation of Agency Rules
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“‘‘a court must necessarily look to the administrative
construction of the regulation if the meaning of the words
used is in doubt. The intention of Congress or the
principles of the Constitution in some situations may be
relevant in the first instance in choosing between various
constructions. But the ultimate criterion is the
administrative interpretation, which becomes of
controlling weight unless it is plainly erroneous or
inconsistent with the regulation.
 Bowles v. Seminole Rock & Sand Co., 325 U.S. 410
(1945), upheld by Auer v. Robbins, 519 U.S. 452 (1997)
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Implications of Seminole Rock /Auer
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Should interpretation of rules and statutes be the
same standard?
 Does Seminole Rock /Auer look like Chevron?
What perverse incentives does this give the
agency if it gets to resolve ambiguous rules?
 What if it just repeats the statute in it rule?
 Does it get more deference that way?
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Judicial Review of Facts
Scope of Judicial Review of Facts
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Congress sets scope of review, within
constitutional boundaries.
Since the Constitution is silent on agencies,
Congress has a pretty free hand
Congress can allow anything from a trial de novo
to no review, unless such an action runs afoul of
the constitution.
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Trial De Novo
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You start over at the trial court
Agency findings can be used as evidence, but
there is no deference to the agency
FOIA
Used more by the states than the feds
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Independent Judgment on the Evidence
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Decide on the agency record, but do not defer to
the agency's interpretation of the record
Sort of like appeals in LA
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Clearly Erroneous
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Definite and firm conviction that a mistake has
been made on the facts or policy
Same as reviewing a verdict by a trial judge
without a jury
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Substantial Evidence - Formal
Adjudications
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706(2)(E) - only applies to formal adjudications and
formal rulemaking
Could a reasonable person have reached the same
conclusion?
 Standard for reviewing a jury verdict or for taking a
case from the jury
 Should a jury get more or less deference than an
agency?
Hint - substantial means some, not a lot, when you are
the agency
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Substantial Evidence - Informal
Adjudications and Rulemaking
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706(2)(A)
Arbitrary and capricious or abuse of discretion
Same assessment of reasonableness as 706(2)(E),
so the result is about the same as the substantial
evidence test used for formal proceedings
This is the most common standard
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Some Evidence
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Scintilla test
The agency needs to show even less than in the
substantial evidence standard
Only limited use
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Facts Not Reviewable At All
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Congress can prevent certain types of judicial
review
Compensation decisions under the Smallpox
Vaccine Compensation Act are not reviewable
Enabling law is always reviewable unless
Congress has taken away the court's subject
matter jurisdiction
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What if the Court thinks the Agency's
Policy Choice is Wrong?
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Should the court defer to findings which it believes are
clearly erroneous, but are supported by substantial
evidence?
Why is this consistent with the political control of
agencies?
When the legislature gives the agency the power, it is
also saying that it only wants agency decisions
overturned in the most serious cases
Courts have different political views than agencies and
thus they should be esp. careful about reversing agency
decisions.
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Agency/ALJ conflicts: Universal
Camera v. NLRB, 340 US 474 (1951)
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Employer fires chairman after he testified at an
NLRB meeting
What did the hearing officer do?
 Believed the company and did not reinstate him
What did the NLRB do?
 NLRB rejects the hearing officer's finding
 Reinstated the chairman with back pay
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What is the key legal issue before the
court?
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Should the court reviewing the NLRB's action
consider the hearing officer's recommendation?
 Is the agency bound by the hearing examiner's
opinion?
 Should the court look only to the part of the
record that the agency relies on for their
decision or the record as a whole?
Court says you have to look at the whole record,
including the ALJ's findings
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When Are the ALJ's Findings Most
Persuasive?
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What type of rulings by an ALJ carry the most
weight with the court when there is conflict
between the ALJ and the agency?
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ALJs v. Court Masters
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Why is the deference due an ALJ different from
the deference due a master appointed to a judge,
whose findings can only be overruled if clearly
erroneous?
Where does the Master get the power?
What if the agency does delegate final
decsionmaking authority to the ALJ, then wants to
change a decision?
What about Louisiana and the Central Panel?
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Do Chevron and Substantial Evidence
Come to the Same Result?
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Chevron is about interpretations of statutes
Substantial evidence is about factual disputes
What about mixed questions of law and fact?
Does it really matter which standard we apply?
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