Administrative Law - 24 Oct 2006
Agency Organization
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Traditional Government Functions
 Legislative (Rulemaking)
 Judicial (Adjudication)
 Executive (Prosecution)
Why are the separated by the Constitution?
What is the problem of combining them in an
agency?
Constitutional v. APA Limits on Combining
Functions in Adjudications
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The APA provides that should be some separation
of functions in adjudications to reduce the conflict
between prosecuting and judging a case
This is not a constitutional requirement
 The United States Supreme Court will allow a
decisionmaker to have other roles
 There are limits - you have to argue that the
facts make the appearance of conflict
overwhelming
Protections for ALJs
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Civil Service protections
Cannot be assigned other duties - no cleaning the
toilet if the Secretary does not like your rulings
Nash v. Bown, 869 F2d 675 (Cir2 1989)
 Can have performance goals
 Cannot have decisional quotas
What if quality control guidelines are biased
toward supporting the agency position?
Bias by Agency Heads - Withrow v. Larkin
421 US 35 (1975)
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Medical board case
Same agency investigated the case, then pulled
the doc's license
No problem, at the constitutional level
Is there something special about a medical board
case?
Who usually sits on a medical board?
What is the notice and record issue?
Criminal and Civil Law Parallels in
Withrow
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Criminal law judges may rule on probable cause
warrants and then also preside over the case
resulting from the warrant
Civil law judges make many decisions in pretrial
proceedings that would bias their ruling in the
case
The problem is that there is a jury making the final
decision in these cases, not the judge
Valley v. Rapides Parish School Bd., 118
F.3d 1047 (Cir5 1997)
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Firing a school superintendent
In sum, the record in the case unfolds like a soap opera.
The respective views of the parties were regularly aired
out in the print and broadcast media in the Rapides
Parish area. One need only make a cursory review of the
exhibits and the testimony to get a clear impression of
the rancor and deeply held views of the aforementioned
school board members prior to the discharge hearing.
Indeed, the district court's sparing recitation of the facts
underlying its ruling was a tacit acknowledgment of the
general public's and the school board's awareness of the
details of the accusations in the case.
Court Ruling
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Upheld an injunction reinstating the
superintendent until the board could give an
unbiased hearing
No hint from the court about how that might be
done.
FTC v. Cement Institute, 333 US 683 (1948)
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FTC issued reports criticizing a certain method of
cost analysis
Plaintiff argued that this showed that the
commissioners were biased against their
business, which relied on this method
Court said this would prevent the agency from
carrying out its legilative mandate
American Cyanmid v. FTC, 363 F2d 757
(Cir6 1966)
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Chairman of the FTC had investigated drug company
while counsel of a senate committee
When the FTC investigated a complaint on the same
subject against a drug company, the hearing examiner
ruled for the drug company
The Chairman participated in the commission's
overturning of the hearing officer, but his vote was not
critical
The court found that his participation biased the outcome
Would it have mattered if he had done the same at the
FTC?
Association of National Advertisers , Inc.
v. FTC
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FTC is adopting rules on TV advertising directed
at children
 Chairman has written and spoken at length on
the evils of TV ads aimed at children
 Plaintiffs seek to disqualify him because of bias
What happened in Cinderella?
 Cinderella disqualified the same Chairman from
participating in an adjudication because he had
prejudged some of the facts.
Is the Standard Different for Rulemaking?
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Clear and convincing evidence that he
has an unalterably closed mind on
matters critical to the rulemaking.
Can the District Court make this into an
Adjudication?
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Said there were aspects of an adjudication
to this rule making because there was a
limited statutory right of cross examination
Did the circuit court buy this?
 Rejected because modifications of
rulemaking procedures do not make them
adjudications
How did the Court Characterize the
Commissioner's Comments?
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Discussion and advocacy
What is it going to take to disqualify an
agency head from a rulemaking?
Charlton Heston as head of BATF?
Pillsbury Co. v. FTC
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What was the FTC concerned about?
 Monopoly power in flour
How did Congress interfere with the agency action?
 What did Senator Kefauver say?
The court found this improper meddling
 Congress may not require testimony on ongoing
adjudications
Congress may request information as part of its
congressional casework
Principle of Necessity
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What is the Principle of Necessity?
Why is the important for small agencies?
Gibson v. Berryhill, 411 US 564 (1973)
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Optometry board was all independent practitioners
Made it unprofessional for optometrists to work for
employers
 Why?
Court disqualified the whole agency
 Necessity does not cover illegal behavior
What if they got the legislature to pass a law preventing
employee optometrists?
Successor Cases
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Gibson was an extreme case
Financial conflicts are only one factor to consider,
not the determining factor
Must make a strong factual argument
Morgan I
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Statute required a formal rulemaking
 Looks like a formal adjudication
The Secretary had the power to make the decision
 Plaintiffs' submitted written briefs to the agency
 Asst. Secretary conducted the hearing and made
recommendations to the secretary
Secretary made the decision based on the
recommendations
How is this Different from a Trial?
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What did plaintiffs claim about the Secretary's decision?
Did the court allow the Secretary to make the decision if
he did not conduct the hearing?
What did it require him to do?
Why would this be a problem in a modern cabinet level
agency?
This was limited in subsequent cases, which found that
the court should not inquire into the thinking of the
secretary, but only look at the record
What can the Secretary Do?
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Delegate the right to decide
 Not always permitted
 Adjudications often make policy, which the
secretary should control
Make the hearing officer's decision final after 30 and
intervene if the case is important to policy
Set up an internal appeal process to flag important
cases
Decide the case on an executive summary
Approve regulations based on expert staff
recommendations