Administrative Law Outline PDF

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Admin Law outline for Prof Breger...

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Last Updated 4/30/2020 Administrative Law Outline I.

Intro and Fundamental Categories of Administrative Law – Power of agency comes from Congress, which dictates procedures different from Administrative Procedure Act (designed to make a general approach to procedure) a. Constitution => statute => APA b. Agency – defined in § 551 of APA and also interpreted to not include the President, to be an agency must have some independent authority otherwise just an advisor i. White house agencies like OIRA (made by Regan if an agency is introducing new regulation must send a draft to OIRA for review) or OMB ii. Cabinet Departments iii. Executive Agencies iv. Independent Regulatory Boards or Commissions v. Public/Private Agencies c. Major issues that come up with Admin Law i. Discretion – how much do officials have should decisions be political or based on experience ii. Deference – how much should be given to the agency iii. Rationality – agency must give reasons d. Cases i. Londoner v. Denver (1908) – Mr. Londoner and other brought an action in state court against Denver’s new assessment of a tax for the cost of paving a street near their lands, which Denver claimed it had the power to do under its charter that allows for improvements and to assess cost and requires due notice and opportunity for hearing prior to cost imposed 1. Issue – Must a city provide notice and an opportunity for a hearing before assessing tax on landowners for local improvements? 2. Holding – yes, notice must be through personal, by publication or law fixing time and place of hearing under Due process ii. Bi-Metallic Investment CO v. State Bd. Of Equalization (1915) – Bi Metallic wanted to stop State bd form increasing valuation of all taxable property in Denver on the grounds they were not offered a hearing and therefore were deprived of Constitutional due process rights 1. Issue – do all property owners have constitutional right to be heard prior to the adoption of an administrative order that increases property taxes?

Last Updated 4/30/2020 2. Holding – The DP Clause of the Constitution requires that the

government give an individual notice and an opportunity to be heard before depriving that individual of his life, liberty, or property. Yet, where an agency order applies to a large number of people, the DP Clause does not require that each person have an opportunity to be heard regarding the order’s adoption. This is because granting every interested person an opportunity to argue for or against such an order would be impracticable II.

Rulemaking §551—Definitions (4) “rule” means the whole or a part of an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or describing the organization, procedure, or practice requirements of an agency and includes the approval or prescription for the future of rates, wages, corporate or financial structures or reorganizations thereof, prices, facilities, appliances, services or allowances therefor or of valuations, costs, or accounting, or practices bearing on any of the foregoing; (5) “rule making” means agency process for formulating, amending, or repealing a rule; (6) “order” means the whole or a part of a final disposition, whether affirmative, negative, injunctive, or declaratory in form, of an agency in a matter other than rule making but including licensing; (7) “adjudication” means agency process for the formulation of an order; a. Order or Rule – Agencies may create law or policy by promulgating rules or issuing orders (Rulemaking – formal or informal; adjudication – formal or informal) i. Rule – is a statement made by an agency that is designed to implement, interpret, or prescribe law or policy and binds all parties regulated by the agency. 1. Example – Congress delegates to the FAA the authority to regulate aviation safety. Through rulemaking, the FAA may implement a rule that sets the maximum take-off speed for airplanes to a safe 150 miles per hour. Once implemented, all regulated airplanes must comply with the maximum take-off speed. ii. Order - is when an agency makes a final disposition in a matter other than rulemaking. The APA defines ADJUDICATION (§554) as the agency process for formulating an order. Typically, an administrative law judge conducts a hearing and issues an order that binds only the parties involved, much like a judge would in a court of law.

Last Updated 4/30/2020 1. Example – FAA conducts a hearing to determine whether an airline uses unsafe take-off speeds. The administrative law judge may order the airline to limit take-off speeds to under 200 miles per hour, rather than 150 miles per hour, based on the weight of the airplanes involved. *Once issued, the order may provide a basis for similar orders in future hearings. III.

Informal Rulemaking (§553(c)) – most common type of rulemaking and also known as notice-and-comment rulemaking; 3 steps a. Notice – The agency must publish a notice of the proposed rule in the Federal Register—a daily publication containing public notices as well as proposed and final rules i. Adequacy – notice should also have sufficient clarity and specificity to allow the public to participate in a meaningful and informed manner. 1. Logical Outgrowth test – if there has been a change since the rulemaking notice was originally posted must be reasonably foreseeable 2. Chocolate Manufacturers v. Block (1985) – to much sugar being suggested for pregnant women so changing regs significantly after giving notice a. Take away – one has to choose either the broad interpretation ii. Example - if the FAA decides to implement a policy that bans the use of unmanned drones for commercial purposes, it must publish a notice in the Federal Register to inform the public that the agency intends to promulgate a rule that bans the use of commercial drones. For the FAA’s notice to be considered adequate it must provide a way to submit comments. b. Comment – the agency must provide the public with a meaningful opportunity to comment so that the public can participate in the rulemaking process i. After receiving comments – the agency must consider and incorporate any persuasive comments and include a concise general statement of basis and purpose into the final rule. ii. Additional changes – an agency may hold a new comment period for each formulation of the rule. However, the final rule cannot deviate too far from the initial proposal. Courts have held that the final rule adopted by an agency must be a logical outgrowth of the rule proposed in the notice. iii. Example – the FAA must provide the public with the opportunity to comment on a proposed rule banning commercial drones. The FAA must

Last Updated 4/30/2020 also disclose that the agency formulated the proposed rule in reliance on a study showing that commercial drones often cause dangerous accidents c. Publication – the agency must publish the final rule in the FR with an effective date not less than 30 days after publication i. Example – the FAA publishes a final rule in the FR banning commercial drones on July 1. The effective date of the FFA’s rule should not be less than 30 days and if the FAA fails to publish the rule then the rule may only be enforced against a party with actual and timely notice of the rule. d. Additional Requirements/Practices i. Vermont Yankee v. Natural Resources Defense Council (1978) – courts cannot add requirements to rulemaking like a hearing if it is not in the statute ii. U.S. v. Nova Scotia (1977) – FDA requirement for cooking fish; scientific studies were used to determine new rule and were not disclosed during comment period; if the court is going to review informal rulemaking then they will need full record IV.

Exceptions to §553 (Notice and Comment) a. Good Cause exception – requires specificity (fact specific not enough to be health and safety must be specific) i. Impractical – putting notice of wage freeze that will have ramifications ii. Unnecessary – typos generally don’t need a notice and comment period iii. Public interest – regulations re airline safety post 9/11 (immediate implementation) b. Interpretive Rulemaking – does not have the force of law except on the government agency, which is bound by their own interpretive rules i. Notice and comment not required by law but in practice for interpretive rules because most agency have said they will provide it ii. Example – private zoos; the statue says if you have a zoo you must have stop animals from jumping out to protect the public. An agency then specifies structural fence through legislative rule. The interpretive rule then says at least 7ft. (it does not have full force of law) c. Procedural Agency Rule i. Enforcement of interpretive law is governed by guiding documents but they are not actually binding. 1. Texas v. US (2015) – Obama gave guidance to ICE that laws against Dreamers should not be enforced; made statement on policy but does not have official force of law

Last Updated 4/30/2020 a. Substantial interest test – no need for notice and comment if just an agency procedure or practice d. Foreign Affairs - government needs to defend its property V.

Agency interpretation of Regulation – Seminole Rock/Auer – ordinarily deference to an agency’s interpretation of its own ambiguous regulation, unless, a. Agency’s interpretation is “plainly erroneous or inconsistent with the regulation b. There is no reason to suspect that the agency interpretation “does not reflect the agency’s fair and considered judgment on the matter in question (kinda like Skidmore deference) c. The regulation parrots the statute (Gonzalez v. Oregon pg 1250) d. If no fair warning to parties in enforcement context, widened to include nongovernment penalty context

VI.

Remand without Vacatur a. Court finds defect in rule can send it back to agency without vacating

VII.

Reasons Courts and Agencies favor informal rulemaking (think Peanut butter) i. National Petroleum Refiners Association v. FTC (1973) – the D.C. Circuit Court of Appeals held that any statutory ambiguity regarding whether the FTC could use rulemaking instead of adjudication was to be resolved in favor of allowing rulemaking ii. United States v. Stored Broadcasting (1956) – the Supreme Court found that the Federal Communications Commission could use rulemaking instead of adjudication to reject licensing applications when a hearing was unnecessary, even though the relevant statute required a full hearing for any rejection. iii. Rulemaking involves a clear and definite statement that addresses all parties, while adjudication involves an order that only addresses the parties involved in the hearing. iv. Rulemaking also provides the public with the opportunity to comment on the proposed rule, while adjudication only provides the parties in the hearing with the opportunity to present evidence that affects the agency’s decision. v. Rulemaking often uses fewer resources and is more efficient than adjudication, which requires conducting a potentially lengthy hearing

VIII.

Retroactivity - a statutory grant of legislative rulemaking authority will not, as a general matter, be understood to encompass the power to promulgate retroactive rules unless that

Last Updated 4/30/2020 power is conveyed by Congress in express terms (Bowen v. Georgetown University Hospital (1988) a. APA - § 551(4) – an agency statement of general or particular applicability and future effect” 5 U.S.C. § 551(4) “required that rules have legal consequences only for the future. b. Primary – when a rule changes past legal consequences of a past legal action c. Secondary – future legal consequences of past activity – only applies to future d. Interim Rule – “I have good cause but we’re good gov so now that the rule is in operation, I’ll take notice and comment” IX. X.

Cost Benefit Analysis – only need to submit to OIRA in additional documentation and not much in regs issue with what be qualified like human dignity, beauty, etc. Inspections – does an administrative inspection need to follow 4th amendment a. At first court found warrantless inspections unconstutitional but now they have made a distinction between administrative warrant (where you don’t have to show the same level of particularity only need reasonable cause not probable. b. Marshall v. Barrow – reasonable expectation of privacy from administrative warrant.

XI.

Hybrid Rulemaking: formal procedures in informal rulemaking (ie: hold hearings for public participation) a. Hearings, fuller preambles/statements, large comment periods b. Although most rulemaking is informal, it has evolved many times to include hybrid-type procedures including oral hearings, a record, and other elements of formality

Adjudication I. Formal Rulemaking (Adjudication) – found in §§ 556 and 557 of APA, replaces the comment step of informal rulemaking with adjudicative process a) Adjudicative process – An impartial agency official or administrative law judge (ALJ) allows parties to submit arguments and evidence regarding the proposed rule i. Parties may use subpoenas and depositions, or settlement conferences ii. The presiding agency official or administrative law judge makes a decision on the record by ruling on each argument presented iii. ALJ makes the findings and conclusions on each issue, and stating the final rule that should be adopted by the agency. b) Formal rulemaking is required when the relevant statute requires a rule to be made “on the record after the opportunity for an agency hearing.” APA, 5 U.S.C. § 553(c) (2006).

Last Updated 4/30/2020 i. For example, Congress passes a statute authorizing the FAA to regulate drones, but only if any rules are made on the record after the opportunity for a hearing. Under the statute, the FAA must use formal rulemaking to promulgate a rule that bans the use of commercial drones c) Cases i. Securities & Exchange Commission v. Chenery Corp (1947) – the courts must base their review of administrative action on the reasons the agency actually gave – underlies much of contemporary admin law doctrine ii. NLRB v. Bell Aerospace (1974) – the board is not precluded from announcing new principles in an adjudicative proceeding and the choice between rulemaking and adjudication lies in the first instance with in the Agency’s discretion. II. If an agency says explicitly you have to make a rule after a hearing a) Seacoast v. Costle (1978) – public interest groups wanted hearing but agency refused. No deference to the agency because formal adjudication protects rights of applicant and public. i.

Presumption that unless statute otherwise specifies adjudication must be formal. if statute says hearing must mean formal adjudication on the record hearings

b) Dominion Energy Brayton Point v. Johnson – Post-chevron (where agencies get deference for reasonable interpretations; if court has ruled on interpretation, court interpretation binds only if court finds statute unambiguous c) Citizens Awareness v. US (2004) – changed hearing procedures on licenses through notice and comment making and amended them as new procedure on formal adjudication i. Always start with the procedural requirements in APA cross examination allowed only if “necessary to ensure the development of an adequate record for decision” III. Ex parte Contacts - informal rule making has no ex parte restrictions (554(d)(1); 557(d)(1) pg 9-15 of Adjudication review packet a) HBO v. FCC (1977) – per curium decision after rule making there were thousands of ex parte communications; the court said that it is intolerable that there is one record for the public and a different one for the meeting; all issues need to be on the record. i. How can the court review the decision if half the issues were discussed off the record b) Ludwif v. Astrue – FBI agent told ALJ after hearing that Ludwig was faking is physical disability (ALJ denied benefits but said little weight was given to the ex parte communication c) PATCO v. FLRA – PATCO called a strike and group meeting with member Applewhaite and FLRA when an FLRA staff member came in and discussed legal issues related to case. d) Communication within Government

Last Updated 4/30/2020 i. Pillsbury Co. v. FTC – agency adjudicating complaint against Pillsbury, commissioners questioned in hearing about legal position of case (before 557(d)); found to be impermissible ii. IV. Informal Adjudication - §555 applies to agency proceedings and functions and is seen to apply to informal adjudication a) Allows counsel; requires agency “within reasonable time to conclude a matter presented to it;” requires some statement of agency decision; for challenge agency needs to produce a record (which is what the agency considered in making a decision); agency statutes can add procedures V. Due Process – based in 5th and 14th Amendments (not deprived of life, liberty, or property a) Whether government’s discretion has been so narrowed that entitlement is created (relevant: custom, practice, state/federal law, common law) b) Traditional Model of Property – rights v. privilege i. Goldberg v. Kelly (1970) – whether DPC requires pre-termination hearing for welfare beneficiaries; welfare is such a brutal need the hearing can be before the benefit is lost. ii. If it is a property interest you get the hearing but you must already have the property interest. iii. Board of Regents v. Roth (1972) – guy hired on one year contract then was not renewed; issue of whether they can fire/not renew without a hearing (a) Property is mostly defined by state law so you must look to the state documents to tell you what kind of expectation you have, which then determines whether you have a property interest and can therefore have a right to a hearing iv. Perry v. Sinderman (1972) – guy worked for ten years and then was fired; HR document basically gave him assurance he was tenured; because of the state policy it not a unilateral property right and therefore he had a property right. v. Kerry v. Din (2013) – husband stuck in Afghanistan and wife sues because liberty does not include a right to marriage. vi. Arnett v. Kennedy (1974) – US gov posted job but with stripped down due process rights in terms of firing; only post termination hearing allowed by court vii. Cleveland v. Loudermill (1985) – overturns Arnett you get more due process than Constitution requires but not less. c) Modern Due Process – i. Town of Castle Rock v. Gonzales (2015) – woman has restraining order against husband he comes with a shotgun takes 3 daughters she calls police but they don’t come (3 girls are later found dead).

Last Updated 4/30/2020 (a) Court holds she had no property interest in getting the “benefit” of restraining order; State law may create substantive interest, federal const law determines whether the interest meets entitlement test ii. Mathews v. Eldridge (1976) disability benefits case; did he deserve a hearing before the benefits were terminated; gives us Due process criteria (balancing of the 3) (a) The private interest that will be affected (b) Risk of erroneous deprivation and probable value of additional procedures and safeguards (c) Government interest/ financial burden in implementing additional procedures and safeguards VI. Deference – Agencies v. Courts; accountability, expertise, pragmatic/manageability, separation of powers, Congressional intent/draft rule a) NLRB v. Hearst (1944) – traditional approach, newsboys that deliver and distribute newspapers, are they considered employees and therefore entitled to union bargaining rights under the meaning of the National labor relations act? i. Court held – the court can interpret the text of the statute but the agency should be deferred to as they have the most experience. b) Skidmore v. Swift (1944) – overtime for firefighters while waiting i.

No legal formula on such a wide variety of issues, Deference based on each case must stand on its own facts, validity of its reasoning, consistent with earlier and later pronouncements, if and all those factors which give it power to persuade, if lacking power to contr...