CHAPTER 6

1. CHAPTER 6 Administrative Law

2. INTRODUCTION This chapter examines the role of administrative agencies functioning as an informal fourth branch of government. It offers students an explanation of how these agencies function, and of the appropriate interactions necessary for an individual or business to successfully navigate the vast world of administrative agency authority.

3. HOW ADMINISTRATIVE AGENCIES ACT • The Fourth Branch of Government – administative agencies have quasi-legislative, quasi-judicial, and executive roles. • Making Rules 1. Notice to the Public (Federal Register) 2. Evaluation and comment period 3. Adoption • Conducting Formal Adjudications-administrative agencies can make formal investigations and have hearings.

4. HOW ADMINISTRATIVE AGENCIES ACT Case 6.1 Synopsis. Chamber of Commerce v. United States Department of Labor, (D.C. Cir. 1999). OSHA issued a directive (the Directive) establishing the OSHA High Injury/Illness Rate Targeting and Cooperative Compliance Program, a new approach to the problem of work safety at dangerous workplaces. The Directive set up a procedure whereby dangerous workplaces would be placed on a “primary inspection list” and subjected to a comprehensive inspection. The Chamber of Commerce challenged the Directive for failure to provide notice and an opportunity to comment. ISSUE: Was OSHA required to provide notice and an opportunity to comment ? HELD: Yes, the court vacated the directive because it was neither a procedural rule or policy statement.

5. ADMINISTRATIVE AGENCIES AND THE CONSTITUTION • Separation of Powers concerns. • Limits Imposed by the Bill of Rights are still applicable: - Self-Incrimination - Probable Cause - Search and Seizure - Right to a Jury Trial

6. SEPARATION OF POWERS Case 6.2 Synopsis. Noriega-Perez v. United States (9th Cir. 1999). Noriega-Perez was indicted in the district court for the Southern District of California for conspiracy to possess forged, counterfeit and false immigration documents. He entered a plea of guilty and was fined. After his plea, the Immigration and Naturalization Service (INS) filed a complaint alleging that Noriega-Perez violated the Immigration and Nationality Act (Act) by forging immigration documents and possessing fraudulent Social Security cards and INS forms. After a number of motions, the administrative law judge (ALJ) issued an order imposing a civil fine on Noriega-Perez. Noriega-Perez appealed. ISSUE: Does the imposition of a fine by an ALJ, rather an Article III judge, violate the separation of powers? HELD: No, the civil fine was upheld. The INS Act did not impermissibly delegate Article III powers to the ALJ.

7. DELEGATION OF AUTHORITY Case 6.3 Synopsis. American Trucking Ass’n v. EPA, (D. C. Cir. 1999). Sections of the Clean Air Act require the EPA to promulgate national ambient air quality standards (NAAQS) for a list of air pollutants identified by the agency. EPA sets a “primary standard,” a level necessary to protect the public health with an adequate margin of safety, and a “secondary standard,” a level necessary to protect the public welfare. In July 1997, the EPA issued final rules revising the primary and secondary NAAQS for particulate matter and ozone. Plaintiff filed petitions for review of the rules on a number of grounds including that the EPA construed the CAA as to render them unconstitutional delegations of legislative power. ISSUE: Were the EPA rulings unconstitutional delegations of legislative powers? HELD: Yes. The court remanded the matter to the EPA to give the agency an opportunity to extract a determinate standard of its own.

8. PRINCIPLES OF ADMINISTRATIVE LAW • Choice of Approach – administrative agencies have a fundamental right to decide whether to proceed on a case-by-case basis or by rule. • Authority to Act – it is incumbent upon those dealing with governmental agencies to make sure that the person they are dealing with is authorized to act and that the proposed actions are permitted by law.

9. JUDICIAL REVIEW OF AGENCY ACTIONS • Review of Rule Making and Informal Discretionary Actions • Review of Factual Findings • Review of Statutory Interpretations • Review of Procedures • Standing to Sue

10. RULE MAKING AND INFORMAL ACTIONS Case 6.4 Synopsis. FDA v. Brown and Williamson Tobacco (U.S., 2000). On August 28, 1996, the FDA promulgated regulations entitled “Regulations Restricting the Sale and Distribution of Cigarettes and Smokeless Tobacco to Protect Children and Adolescents.” The regulations targeted the promotion, labeling and accessibility of tobacco products to children and adolescents. A group of tobacco manufacturers, retailers, and advertisers challenged the regulations on the grounds that the FDA lacked administrative authority to regulate tobacco products. ISSUE: Does the FDA have authority under the Food, Drug and Cosmetic Act (FDCA) to regulate tobacco products? HELD: The U.S. Supreme Court struck down the FDA regulations on tobacco noting tobacco’s “unique place in American history and society, [and] its own unique political history.”

11. FACTUAL FINDINGS Case 6.5 Synopsis. Dickinson v. Zurko (U.S., 1999). Zurko applied for a patent on a method for increasing computer security. The PTO examiner denied the application after concluding that the method was obvious in light of prior art. The PTO’s review board upheld the examiner’s decision, and Zurko sought review in the U.S. Court of Appeals for the Federal Circuit. The appeals court treated the PTO’s conclusion as a factual finding and ruled that it was “clearly erroneous” under the Administrative Procedures Act (APA). The Commissioner of Patents appealed. ISSUE: Were the PTO’s factual findings subject to the clearly erroneous standard of review or the less stringent standard set forth in the APA? HELD: Reversed. Supreme Court held that the standard of review under the APA was the appropriate standard.

12. STANDING TO SUE Case 6.5 Synopsis. Lujan v. Defenders of Wildlife (U.S.1992). The Endangered Species Act (ESA) instructs the Secretary of the Interior to have a list of endangered species. The Fish and Wildlife Service and the National Marine Fisheries Service promulgated a joint regulation stating the obligations under the ESA be extended to actions taken in foreign countries. The next year, the Interior Department revised and re-interpreted the section requiring consultation only for actions taken in the United States or on the high seas. ISSUE: Do organizations interested in environmental and wildlife issues have standing to sue? HELD: No. The Supreme Court ruled that these groups lacked sufficiently imminent injuries to have legal standing.

13. LIMITS OF REVIEW • No Right to Probe the Mental Processes ofthe Agency – a court may not inquire into the decision-making process, but the legislature may. • Timing of Review • Exhaustion of Administrative Remedies • Ripeness - legal, not hypothetical questions

14. DECISION-MAKING POWER OF AGENCIES • Only Delegated Powers – an administrative agency may do only what Congress or the state legislature has authorized it to do. • Obligation to Follow Own Rules – agencies are required to follow their own rules and regulations. • Explanation of Decisions – an agency must explain the basis for its decisions and must show that it has taken into account all relevant considerations as required by the statute.

15. FINDING AN AGENCY’S RULES AND PROCEDURES • The Federal Register and the Code of Federal Regulations (CFR) provides notice of rules and changes.

16. OBTAINING DOCUMENTS FROM AN AGENCY • With certain specific exemptions, the Freedom of Information Act allows any citizen to request documents of the government on any item of interest. • The agency is then required to respond within 10 days.

17. SEVEN BASIC STEPS FOR WORKING SUCCESSFULLY WITH AN ADMINISTRATIVE AGENCY • Investigate the applicable standards that will govern the agency’s actions. • Identify and evaluate the agency’s formal structure. • Determine what facts are before the agency. • Identify the interests of others who may be involved in the decision-making process. • Adopt a strategy to achieve the desired goal. • Eliminate any adverse impacts on other interested parties. • Get involved in the administrative process early and stay involved.

18. REVIEW • Are administrative agencies constitutional? Why? • If administrative agencies act at least quasi-judicially, why is there no right to a jury trial? •  Should there be a Court of Appeals specifically for all administrative agency decisions?