ADMINISTRATIVE LAW

I. Introduction

A. Nature of Agencies
1. Agencies = Governmental bodies other than courts of the legislature that affect the rights and duties of persons or
entities.
a. agencies, administrations, bureaus, departments, etc.
2. Must be created by legislation. No such thing as a common law agency.
3. Exist at all levels of government
a. We are going to be concentrating on the Federal Administrative Procedure Act.
a) it is the model for all other administrative acts.
b) Federal agencies wield a lot of power.

B. The Administrative Procedure Act (APA)

1. The APA is like a code of civil procedure.
2. They all appear in Title 5 of the U.S. Code.
3. 5 U.S.C. §551(1):
a. Defines agency as “each authority” of the government of the United States but excludes:
a) Congress
b) Courts So none of these are agencies
c) Governments of territories or possessions within the meaning of the
d) Government of the District of Columbia APA.
e) Military Courts
f) President (established by case law: Franklin v. Mass (US 1992))

C. Agencies Simulate All Three Branches of Government

1. Rulemaking = simulate the legislative branch.
2. Adjudication = simulate the judicial branch.
a. determine rights and duties of various parties
b. i.e. are people entitled to gov’t benefits, do they have to pay a gov’t penalty, can a plant continue to operate
w/out a courtstack scrubber?
c. ALJs = agency employees who operate adjudication.
3. Investigations and Other Executive Action = simulate the executive branch.

D. Types of agencies
1. Executive agency
a. part of the executive branch
 b. Notable for having one person at the head of the agency who serves at the pleasure of the POTUS.
c. i.e. EPA = headed by a single person and that person
2. Independent agency
a. Multi-member agencies.
b. The persons who head the agency are appointed by the president subject to Senate confirmation but they serve
rotating (staggered) terms. There isn’t a switch over every time we get a new president.
c. Sometimes referred to as the “Fourth Branch of Government.”
d. i.e. Equal Employment Opportunity Commission

II. Procedural Due Process

A. Relevance to Administrative Law

1. Large volume of administrative adjudication, agencies don’t always follow the same procedures that courts do.
a. discovery procedures are different
b. person who decided is different (no jury trials)
2. To what extent can agencies vary from court-like procedures and still comply with demands of procedural due-
process?
a. i.e. it would be unacceptable to have a party come in and say he’s entitled to gov’tl benefits and then the agency
doesn’t let the person testify and the ALJ makes decision based on personal prejudice.

B. Four Step Test – to analyze procedural due process problem

1. Governmental Action
2. Individualization
3. Protected interest
4. How much process is due?

C. Step One: Governmental Action

1. Hardly ever a problem in Administrative Law
a. Because the definition of an agency is that it is an authority of the government!

D. Step Two: Individualized Action

1. Action directed at a small number of people or entities for particular reasons.
a. Hypothetical #1: Social Security Administration decides to stop paying disability benefits to Pat because the
medical evidence indicates that he is now able to work.
a) Is this individualized action that might be subject to procedural due process?
i. YES! It’s a determination by the social security administration that is particular to Pat.
b. Hypothetical #2: Congress decides to reduce benefits across-the-board by 20%, and Pat wants to challenge his
reduction in benefits in court on a procedural due process theory.
 a) Would Pat have luck on a procedural due process claim?
i. NO.
c. From Pat’s perspective, he’s not getting the gov’t benefits that he’s expecting in either of these cases. However,
in theory, the political process is supposed to protect people like Pat in the second case and it would be too
cumpbersome if all people affected in the second example coiuld get an individualized hearing.

2. Comparison with APA distinction between Adjudication and Rulemaking

a. 5 U.S.C. §551(5): “Rulemaking” is the agency process for formulating, amending, repealing a rule.
b. 5. U.S.C. §551(4): “Agency statement of general or particular applicability and future effect designed to
implement, interpret, or proscribe law or policy…” specifically includes ratemaking.
a) process of making rules.
b) Rules are the things that are like statutes.
i. open ended and future effect.
c. §551(7): “Adjudication” is the “agency process for formulation of an order.”
a) §551(6): “Order” = is the disposition in a matter other than rulemaking, including licensing.
d. Difference between rulemaking and adjudication:
a) 1 = Rulemaking looks forward, adjudication looks back.
b) 2 = Rules apply to an open class of persons/entities; orders apply to named persons.
e. Hypothetical #3: The EPA brings an administrative action against Dump Co. to require it to pay a penalty for
having discharged TCE into the town’s aquifer.
a) Is this agency adjudication or rulemaking?
i. This is adjudication b/c it looks backward to a particular event in the past to decide was the
company’s activity legal or illegal? And it will fine Dumpco individually.
f. Hypothetical #4: The EPA adopts a policy that the maximum amount of TCE allowed in any aquifer is 10 parts
per billion.
a) Adjudication or rulemaking?
i. This is rulemaking b/c it doesn’t bind any particular party, it applies to an open class of persons.
ii. And it doesn’t purport to assess the legality of any past conduct it only says the EPA is setting this
standard from this day forward.
g. Relationship of Rulemaking/Adjudication Distinction to Procedural Due Process
a) Most of the time agency rulemaking is not going to involve a procedural due process problem b/c it will
be generalized action.
i. caveat =
b) Adjudication may well involve a due process claim b/c it is individualized action.

E. Step Three: Protected Property or Liberty Interest?

1. Property interest
a. “Old” property = tradition indicia of wealth i.e. money, stocks, gold bullion, etc.
 a) if an agency is bringing an action that might require a company to pay a penalty for exceeding emissions
maximum then there is old property involved there.
b. “New” property: i.e. entitlements such as welfare benefits, certain government jobs, etc.
a) Here we have some pretty close cases as to whether the affected person really has a property interest.
2. Famous cases dealing with property interests
a. Board of Regents v. Roth (U.S. Sup. Ct. 1972)
a) Roth was an untenured political scientist professor at Univ. of Wisconsin It was alleged Roth was active in
Vietnam protests. At the end of his first year he got let go.
b) Roth alleged that his procedural due process rights were violated.
i. Governmental action b/c Univ. Wisconsin is a governmental entity
ii. Individualized b/c it was only Roth who they let go when over 95% of other professors were
retained for a second year.
c) SCOTUS rules that Roth did not have a procedural due process claim b/c he didn’t have a property
interest in his job. Court said that property requires something more than just a unilateral
expectation that you’ll get something; it has to involve some sort of entitlement.
i. In Roth’s case, the University’s Rules and Regulations said that an untenured professor could be
dismissed for any reason. So Roth could not point to anything rule, regulation, etc. that would
confine the University’s discretion. As a result, Roth was found to have no property interest in his
job.
b. Perry v. Sindermann (U.S. Sup. Ct. 1972)
a) Texas community college professor who was alleged to be engaged in certain union activities. The
professor was dismissed from his employment also.
b) SCOTUS held that the professor might have had a property interest because even though he was not
tenured, the professor was able to point to certain rules and handbooks that seemed to create a tenure-
like right if someone had stayed there long enough, and the professor had been there for a number of
years.
c) Court said it was at least possible that professor could show that he had some sort of entitlement in state
law.
c. Hypothetical #5: Lucy is a probationary sanitation worker for the County. Under the county ordinance, a
probationary worker’s employment is terminable at will. Lucy is doing an excellent job, but one of the other
workers on her truck has the habit of banging the trashcans too loudly. Lucy’s supervisor mistakenly thinks it is
Lucy, and Lucy is fired without a hearing.
a) Governmental action? = yes. It is the county.
b) Individualized action? = yea. This is particular to Lucy.
c) Does Lucy have a property interest in her job? = Not a chance. She’s in the same boat as Roth was. No
entitlemtne, nothing to confine the government’s discretion.
d. Hypothetical #6: Assume the same facts in #5, except that Lucy is now a “permanent” employee. Under the
county ordinance, permanent employees can be fired only “for just and sufficient cause.”
 a) Now there is a clear standard that confines the government’s discretion and gives her an entitlement 9to
only be fired for just cause)
b) So she is entitled to a hearing before losing her job.
3. Liberty - 2 categories of liberties – fundamental liberty interests, and non-fundamendal liberty (state-
created) interests.
a. Fundamental liberty interests
1. Things that the Supreme Court has decided are fundamental rights we all share under the constitution = i.e.
speech, voting, privacy, etc.
2. Also, agency actions that involve massive deprivation of liberty.
a) i.e. someone is scooped up and transferred to a mental hospital against their will.
b) But not solitary confinement of someone already in prison.
3. No such thing as a fundamental property interest.
a) So liberty interest is distinct from property interest.
b. Non-fundamental (state-created) liberty interests
1. This is very much like the test for property – have to point to some sort of regulation, etc., that confines the
government’s discretion.
2. A lot of these cases come up in the prison setting – b/c prison living involves a lot of rules/regulations like
right to visits, receive books, free time, etc.
a) Sandin v. Connor (U.S. Sup. Court 1995) holds that liberty interests now require an “atypical and
significant” hardship.
i. The transfer to solitary confinement did not involves an atypical/significant hardship.
b) Hypothetical #7: Earl is a prisoner in a maximum security prison. Because of good behavior, he has
accumulated “good time” credits that will allow him to be released three months earlier. The prison
regulations state that a prisoner “shall” have a right to good time credits. The warden believes that Earl
was involved in a riot, and revokes Earl’s credits without a hearing.
i. Governmental action? = yes, he’s being confined by the state.
ii. Individualized credits? = yes.
iii. Liberty interest? = The prison regulations say you shall have the right to good time credits. They
don’t say may or within the warden’s discretion. Atypical or significant hardship? Yes, this is a
matter of being confind for 3 extra months. This is significant.
c) Hypothetical #8: Prison regulations state that prisoners in the general population “shall” have access to
the basketball court on weekdays. Because the warden believes that Earl was involved in a fight, he
revokes Earl’s basketball privileges for a month without a hearing.
i. Gov’tl action? yes
ii. Individualized? yes
iii. Liberty interest? Not a chance. Even though they create what appear to be an entitlement to the
basketball court, this is not an atypical/significant hardship.
c. Reputational Injuries: Special case
 a) The “Stigma-Plus” Test – determines whether or not you have a liberty interest in your reputation.
i. Csase where police chief put up flyers saying that D was a known shoplifter. I NEED TO FIND
THIS CASE.
ii. The Supreme Court held that he did not have a liberty interest in his reputation.
iii. He was stigmatized but he didn’t suffer any injury beyond just the ordinary indicia of stigma.
iv. Just the loss of stigma is not enough.
v. What is the “plus” part?
1. Child abuse registries – in New York there was a low threshold to put someone on the child
abuse registry.
2. Court held that she met the “plus” b/c the lady suffered an additional loss in that her job
goals were frustrated (she was denied employment at a child-care place).

F. Step Four: Amount of Process Due

1. Only if first three steps are fulfilled – have to get through the first three steps first! Don’t immediately jump down to
whether the procedures were adequate w/out analyzing the first three steps.
2. Goldberg v. Kelly (U.S. Sup. Ct. 1970) – Plaintiff was abeing denied welfare benefits. Issue was whether or not the
gov’ts procedures were adequate to determine whether or not these plaintiffs should lose their benefits.
a. Court set forth a list of procedures the court normally would require in a case that involves a significant
property interest:
a) You’re normally entitled to a pre-termination hearing
b) You’re entitled to notice
c) You’re entitled to cross-examination – have to get a chance to cross-examine adverse witnesses
d) You’re entitled to counsel (paid for privately) – not at government expense.
e) You’re entitled to oral presentation
f) You’re entitled to a neutral decision maker
3. Mathews v. Eldridge (U.S. Sup. Ct. 1976) – Supreme Court backs off of the Goldberg list.
a. Said that there are circumstances where the gov’t could substract some from this list.
b. In some circumstances, a post-termination hearing is sometimes sufficient.
c. Written presentation is sufficient in some circumstances and not an oral hearing.
a) The court said this because this case involved disability benefits, not welfare benefits. The important
difference the court pointed out was that welfare benefits deal with very fact specific issues, where as
with disability benefits, you’re dealing with medical records, etc., which may be sufficient to just look at
and it will be okay to dispense with the oral hearing.
d. Flexible three-part balancing test
a) Value to private party
i. the more valuable the interest, it’s more likely you’ll have to get all the things on the Goldberg list.
Less valuable, the gov’t can probably dispense w/some of those procedures.
b) Risk of error without additional procedure
 i. To what extent will the additional procedure contribute to the accurate resolution of the case?
c) Cost to the Government of providing additional procedure
i. To what extent would it cost the government money?

III. Administrative Adjudication

A. Basic Divide Between Formal and Informal Adjudication

1. Formal adjudication requires all the procedures contained in 5 U.S.C §§554, 556, and 557.
a. Darn near a bench trial
2. Informal Adjudication
a. Anytime an agency decides something and it is not rulemaking or formal adjudication = the leftover category.
“Everything else.”
a) So there are a whole lot of things that qualify as informal adjudications.
b) Recall basic distinction between rulemaking and adjudication
b. Hypothetical #9: Park ranger tells a camper to put out a fire because the camper doesn’t have a fire permit.
There are no specific statutes or regulations that cover a park ranger’s authority in such matters.
a) What kind of activity is this?
i. Clearly not rulemaking! Ranger isn’t purporting to speak for the entire agency and tell people that
no one can build fires.
ii. It is clearly adjudication. It looks backward to past event (the building of the fire). Asseses the
legality of it (illegal w/out a fire permit) and an order (put out the fire)
3. What procedures to you get under the APA if you’re involved in informal adjudication? You get almost nothing, but
you do get the following:
a. 5 U.S.C. §555:
a) Private party can have a lawyer at own expense
b) “Interested” persons can appear
c) A witness who is compelled to testify can review transcript
d) Private party can get prompt notice of any denial along with “a brief statement of grounds for denial”
unless it is “self-explanatory.”
b. 5 U.S.C. §558:
a) Sanctions can only be imposed “within the jurisdiction delegated to the agency.”
b) So, park ranger wouldn’t be able to investigate whethery you’re involved in insider trading, etc.
4. Other sources of procedural fairness is informal adjudication (other than the APA)
a. Due process – if you have a property/liberty interest affected by agency, you could get everything on the
Goldberg test.
b. Agency hearing regulations – a lot of times agencies will adopt regulations that will provide for procedures in
informal adjudication EVEN THOUGH THEY’RE NOT REQUIRED TO DO IT.
c. Other statutes
 a) i.e. – the agency’s enabling act may lay out procedures.
d. Administrative common law
5. The notion of “hybrid adjudication”
a. This is not really a category that is set forth in the APA
b. It is informal adjudication but for whatever reason a lot of the formalities of formal adjudication are provided for
by agency policy.

B. What is the difference between formal and informal adjudication

1. 5 U.S.C. §554 = “Every case of an adjudication required by statute to be determined on the record after opportunity
for an agency hearing.”
a. Formal adjudication = on the record. This kicks into gear all of the things in 555, 556, and 557.
b. Either it’s on or it’s off.
a) Off = if there’s nothing in the statutes
b) On = if there is a requirement that it be on the record.
2. Hypothetical #10: The EPA is considering imposing a find on DumpCo for alleged illegal dumping activities. The
relevant statute provides that the EPA must hold a “public hearing” before it imposes any such fines.
a. Formal or informal adjudication? = this is informal b/c it only says public hearing, it says nothing about on the
record.
3. Hypothetical #11: Same as #10, except that the statute provides that the EPA must conduct a hearing “on the
record.”
a. Now, this is formal adjudication b/c there is a requirement for on the record.

C. The Nature of Formal Adjudication – what procedures are required under §§ 555, 556, and 557?
1. Overview
a. Some important features in the summary:
a) Timely notice of any hearing
b) Notice of issues contested – i.e. responsive pleadings
c) All interested persons to make submissions
d) A recommended decision by the agency employee (ALJ)
e) Restrictions on internal ex parte communications – there have to be restrictions b/w the agency
employee who is prosecuting the matter and the ALJ who is deciding the matter.
f) The agency employee who decides (ALJ”) cannot be supervised by any agency employee who
prosecutes/investigates.
i. have to separate the functions internally. Can’t have ALJs who work for the agency and feel
pressured to decide the case for the agency.
g) Person conducting the hearing must either be:
i. Agency head himself, or member of the agency
ii. “Real” Administrative Law Judge
 h) Powers of Agency Employee presiding at formal adjudication (ALJ):
i. Administer oaths
ii. Issue subpoenas make rulings on offers or proof of evidence
iii. Allow for depositions to be taken
iv. Regulate course of hearing
v. Hold pre-hearing and other conferences
vi. Rule on procedural matters
vii. In summary, they act like judges.
i) Any non-privileged evidence is admissible, but the ALJ can keep out irrelevant or repetitive evidence
i. Different from court adjudication. In court there is more elaborate evidence rules (i.e. hearsay
rules) the only evidence rules in agency proceedings is privileges.
j) No sanction without reliable, probative, and substantial evidence = must be evidentiary basis for what the
agency does.
k) Any oral or documentary evidence, and cross-examination as necessary
l) Must allow for rebuttal if official notice is taken.
m) Plenary intra-agency review
i. The relationship of the ALJ to the agency heads is not like that of a lower court to an appellate
court.
ii. The ALJ only makes a recommended decision, the agency head makes the ultimate determination.
iii. As a practical matter, b/c of the huge volume of things that are considered, the ALJ’s decision are
usually dispositive.
n) Opportunity for parties to submit:
i. Proposed findings
ii. “Exceptions” to ALJ’s decision. These exceptions must be ruled on
o) Written statement of “findings and conclusions, and reasons therefor.”
i. ALJ then Agency has to write something saying how they reached their decision.
p) Limitations on external ex parte contacts
2. Nature of the decisionmaker
a. Use of agency employees as decision makers –
a) This is a big difference between judiciary and agency adjucidation
b) This makes people nervous b/c the same agency that is prosecuting them is employing the decision
maker
b. Combination of functions is clearly constitutional
a) The reason is because we want agencies to be experts.
b) We want all agency employees to be on the same page w/r/t agency policy.
c. Administrative Law Judges (ALJs) versus Administrative Judges (Ajs)
a) AJ = administrative judge who decides informal adjudication
b) ALJ = deals with formal adjudication
 d. Challenging agency decisionmaker for bias
a) Showing the employment relationship not enough.
b) Traditional grounds
i. pecuniary interest – i.e. the ALJ owns stock in the company that will be affected.
ii. family relationship
c) Mere “background” bias not sufficient
i. Hypothetical #12: Before Jill became an ALJ with the NLRB, she had worked for 20 years as an
attorney representing management in labor disputes. A union is being charged in an
administrative proceeding before NLRB with having engaged in an illegal secondary boycott, and
Jill is assigned to hear the case. Jill has no familial relationship with any of the parties, nor does she
have any pecuniary interest in the outcome. The Union challenges Jill’s ability to fairly hear the
case.
1. Does the Union have a chance here? – No. Agencies are experts, as a result, someone who
will come into a position as a ALJ is likely to have a lot of experience in the matter, which
necessarily has to come on one side or the other.
d) Prior statements indicating significant prejudgment
i. Usually more of a problem w/ agency heads (b/c they are political appointees who make speechs,
testify in front of Congress, etc.) and as a result they make more statements on these types of
things.
e. Morgan Cases
a) The agency person making the determination (ALJ, etc.) has to take personal responsibility for the
decision.
3. Limitations on Ex Parte Contracts – 2 types: Informal and Formal
a. Internal ex parte contacts: 5 U.S.C §554(d)
a) Generally allow internal contacts on legal issues, but prevents internal contacts on factual issues
i. Rationale – nothing wrong with ALJ talking w/ someone else in the agency about how an agency
interprets its regulation, etc. On the other hand we do want the parties to get a fair shake on the
facts, so and ALJ can’t walk down the hallway asking people “have you ever dealt with Sally
Smith?” and someone from the prosecuting agency employe says “yeah, I know her, she’s a
lawyer.”
b) Exceptions
i. Application for initial licenses – reasoning is that this is pretty public anyway.
ii. Rates of public utilities
1. Redundant because ratemaking is rulemaking anyway. Rulemaking is not covered by §554.
iii. Agency heads
1. Confusing exception: only applies in rare cases in which agency head acts as “trial judge.”
c) Bottom line = if you see an ALJ talking about policy with another agency employee, that’s okay. If you
see him/her talking about the facts with another employee, that’s probably not okay.
 b. External ex parte contacts: 5 U.S.C. §557(d)
a) Anyone “outside” the agency, even the President of the United States.
i. There is a Reagan case dealing with this. Find it.
b) Applies to any “interested” persons.
i. Interested persons is defined very broadly. Basically, if you’re talking about it with someone else,
you’re interested enough to become an interested person.
c) Communication only need be “relevant to subject matter”
i. We don’t distinguish between factual and legal matters like we did in internal ex-parte
communications. The “relevant to the subject matter” standard tries to shut off ex parte
communications to a much greater degree.
d) Covers both decision-makers and persons expected to be in decision process (i.e. law clerks to the ALJ)
i. i.e. it would impermissible for someone outside the agency to lobby one of the law clerks about
how a particular formal adjudication should come out.
e) §554(d) exceptions don’t apply
i. i.e. applications for licenses, rates of public utilities, and agency heads.
f) Variable remedies
i. Remedy has to be appropriate under the circumstances and doesn’t necessarily involve voiding
the whole adjudication.
ii. Air Traffic Controllers and Reagan Admin case
1. What to do about the impermissible lobbying – court decided not to void the whole thing
b/c the Union lost anyways.
g) §557(d) also applies in formal rulemaking
i. Unlike §554(d): which applies only to formal adjudication
4. Notice of the hearing and issues
a. Required by statute for formal adjudication
b. Also required by Due Process for informal adjudication
5. Discovery generally only as allowed by Agency
a. One of the big differences b/w court adjudication and agency adjudication.
b. Court adjudication allows for elaborate discovery i.e. depositions, interrogatories, requests for admissions, etc.
c. Agency adjudication = up to the agency to provide for discovery in its rules but it doesn’t have to.
6. Parties to the hearing
a. Private party most affected is a party to the hearing
b. Interveners = persons who are similarly situated or have a stake in the matter.
7. Agency duty to explain decision
a. w/r/t formal adjudication under §557(c): “findings and conclusions, and reasons or basis therfor”
b. w/r/t informal adjudication under §555(e) “brief statement” unless the denial is self-explanatory
c. Common law duty even in informal adjudication
 a) So this is one of those things that just seems so fundamental, that courts are normally to uphold agency
decisions w/out it.
8. Intra-agency review
a. THE ALJ IS ONLY MAKING A RECOMMENDED DECISION.
9. Limitation to record
a. Proved at the hearing
b. Properly made the subject of official notice

IV. Rulemaking – forward looking and affects an open class of persons.

A. Distinction between formal and informal rulemaking
1. If there are rulemaking statutes that require an “on the record” hearing to make a rule, then we have formal
rulemaking.
2. However, language such as “public hearing” or “full hearing” will not suffice and only leads to informal rulemaking.

B. Formal rulemaking – very rare.

1. All the procedures for formal rulemaking set forth in §556-7 (this is most of the procedures for formal adjudication.)
It does not follow §554 (so no internal ex parte contact rules).
a. Very significant procedural rights:
a) ALJ or agency head presides
b) Witnesses under oath
c) Oral presentations with cross-examination
d) Preparation of transcript and decision on the record
e) Limits on external ex parte contacts (but not internal)

C. Informal rulemaking (aka notice-and-comment rulemaking) 5 U.S.C. §553

1. Name highly suggestive: there has to be notice and an opportunity to comment
2. Notice
a. “General notice” in the Federal Register §553(a)
a) Time, place, nature
b) Legal authority
c) Terms or substance or a description of the subject and issues
b. Must be published in Federal Register (unless for some reason the parties affected by the rule receives actual
notice).
c. “Actual notice” standard
3. Formulation of proposed rule
a. Usually an intra-agency process
4. Comments
a. Reasonable period of time to comment
 a) Usually this is months. However, periods as short as 15 days have been approved. There is no set time
outlined in the APA.
b. Written comments all that need to be allowed.
5. Changing the proposed rule before issuing the final rule
a. Sometimes the agency was persuaded enough by the comments that it changed the proposed rule. The changed
rule is then called the “final rule.”
b. Question = when is the change big enough that the agency has to go back and start all over? That the final rule
that they’re thinking of has such a big difference from the proposed rule that they have to send it back for
another round of comments?
a) Courts use the “logical outgrowth test” to determine this: was the change in the rule a logical
outgrowth of the comments? If yes, the agency does not have to go back to “go”.
i. Would another round of comments do any good? Or woiuld we just be delaying the process?
1. If the rule is different enough that it might affect comments from groups who hadn’t
solicited them before, then yeah, we might need to send it back for another round of
comments.
ii. NEED TO FIND THE CASE FOR THIS!!
c. Hypothetical #14: A federal agency has noticed a proposed rule that would limit the amount of certain toxins in
corn. The rule drew extensive comments from corn farmers (who were opposed to the rule) and environmental
groups who favored it. Looking at the comments, but without noticing a new proposed rule, the agency decides
to adopt a rule that limits the toxins in corn, as well as several other crops. Farmers who grow these crops did
not comment on the proposed rule because the proposed rule did not purport to apply to their crops.
a) Would the agency be able to do this successfully? Probably not because those farmers who grow other
crops did not have any reason to think that they would be affected by the rule so they didn’t give
comments the first time.
6. Disclosure of underlying scientific data – when do agencies have to disclose? To what extent?
a. Some courts imply a duty to reveal underlying scientific data so that comment period will be meaningful. It can
be frustrating to parties sometimes when they don’t know exactly what is on the agencies mind. If the agencies
have studies for instance that are leading it to believe there needs to be a new rule, maybe the parties can find
fault with these studies.
7. Adoption of final rule
a. Normally the effective date of a final rule has to be delayed 30 days
a) Exceptions to the 30 day delay:
i. Relieves a restriction
ii. Is merely interpretive or states general policy
iii. Catch all exception - Good cause (sometimes known as the “emergency rule” exception).
8. Statement of purpose in the rule
a. 5 U.S.C. §553(c): “concise general statement of…basis and purpose” of the rule.
b. Some courts have implied quite a large duty w/r/t what courts have to say.
 a) It must be clear, however, that does not require a response to each and every comment.
c. Has to be compiled in the Federal Register, then eventually in the CFR.
9. Limitation to record – the degree to which agencies are limited to the record w/r/t rulemaking.
a. Agencies are NOT limited to the record when it comes to INFORMAL rulemaking, BUT they ARE when it comes
to FORMAL rulemaking.
b. Magic “on-the-record” language = triggers formal rulemaking (though formal rulemaking is rare nowadays.)
c. Agencies are careful here though b/c if they come forward w/ a lot of new data, they may get challenged by
parties who claim that the comment period was not a meaningful comment period.
d. However, there is no TIGHT restriction to the record that we see in FORMAL rulemaking/adjudication.

D. Hybrid rulemaking – does not appear in the APA.

1. Hybrid Rulemaking = informal rulemaking with additional procedures that are imposed on the agency either by
virtue of its own regulations or imposed by the agency’s enabling statutes.
a. The most common additional procedure is probably oral testimony. Sometimes this can involve cross-
examination.
2. Sources
a. Enabling statutes
b. Agency regulations
c. Agency decision in that case
d. NOT THE COURTS!
3. Can Courts impose additional procedures on the agencies w/r/t rulemaking? NO!
a. Vermont Yankee Nuclear v. NRDC (U.S. Sup. Ct. 1978)
a) Battle over how to store nuclear waste. NRDC complained that agency procedures were insufficient b/c
they did not allow for cross-examination of key witnesses. It was informal rulemaking however
(requiring only notice and opportunity for comment), and the agency had clearly complied with the
notice and comment rules. Nonetheless, the DC circuit had held that the agency decision had ventilated
the issues.
b) Holding = DC circuit was wrong. Courts may not impose additional procedures unless constitution
requires or “extremely rare” circumstances. It is up to Congress or the agency itself to impose additional
procedures, not the Courts.
i. The APA is statutory minimum
1. Up to agencies or Congress to go higher
ii. Constitution
1. usually not relevant because generalized action
2. perhaps a narrow ratemaking
iii. “Extremely rare”
1. Perhaps if the agency unjustified departure from past practice
E. Hypothetical #15: TimberCo has an exclusive 10-year contract to log in the Big Timbers forest. The EPA issues a notice of
proposed rulemaking that would ban all logging in the Big Timbers forest because that forest is the last known habitat of the
Spotted Owl. The relevant statute provides that the EPA must conduct a “hearing” before it issues a rule that bans logging
operations. The EPA, over the objection of TimberCo, accepts only written comments. TimberCo’s scientists claim that logging
could continue without endangering the Spotted Owl. Relying on the reports of its own scientists that logging would threaten
the Spotted Owl, the EPA issues a final rule banning all logging in the Big Timbers forest. TimberCo seeks judicial review to
overturn the EPA decision because the EPA did not allow for oral testimony and cross-examination of the EPA
scientists.
1. Rulemaking or adjudication? This is rulemaking. Doesn’t apply just to TimberCo, but open class of entities who are
logging in the forest.
2. What kind of rulemaking? Because it only says “hearing” and it doesn’t say “hearing on the record” it is informal
rulemaking.
3. What does informal rulemaking require? Notice and written coments.
4. The EPA did all of that, and as a result, under Vermont Yankee, there is no statutory duty on the part of the agency to
do more than that.
5. So TimberCo has no good argument under the APA.
6. Does TimberCo have a constitutional argument? Maybe. This is because due process might kickin because this is a
very narrow rulemaking making it likely individualized action. Even though it purports to apply to an open class of
entities, as a practical matter, it applies just to TimberCo b/c they have the exclusive 10 year contract.
a. Clearly governmental action
b. Probably individualized action
c. Property interest?
a) Note: TimberCo has exclusive 10 year contract so they have a property interest.
b) So now the question becomes: whether under the Matthews balancing test they’re entitled to further
procedures.
i. TimberCo has a pretty good argument. This is because their property interest is pretty substantial
(there’s a lot at stake; even though the problem doesn’t tell us exactly how valuable the contract
is, it is probably pretty valuable.)
ii. The cost to the government? Probably stretches the hearing out by a few days, but presumably
the EPA has already put these studies together so not a ton of additional cost.
iii. AND it may likely be that additional procedures (cross-examination and oral testimony) might
contribute to a more accurate resolution of the matter.
7. So bottom line: you might need a few more facts to answer this definitively, but there is at least an argument that
TimberCo’s due process rights were violated, and they may have a shot at winning bringing suit under the
constitution.

F. Categorical Exceptions From Rulemaking Proceedings

1. Still defined as “rules” under §551(4) but they’re exempt from notice and comment procedure.
 2. Exempt Rules
a. Military or foreign affairs function of U.S. – although many of these do go through notice and comment.
b. Relating to agency management as personnel or to public property, loans, grants, benefits, or contracts.
c. Interpretive rules
a) Interpretative rules = rules that do not create new duties but rather explain duties that were “fairly
encompassed” by earlier pronouncements.
b) i.e. a rule that merely collects together a collection of other statements contained in other rules and
makes them easier to find doesn’t have to go through notice and comment.
d. General policy statement
a) some rules just operate at such a general level that they’re basically like rules. They contain such
overarching statements as a practical matter they don’t impose any ironclad duties on persons.
e. Good cause “emergency” rules (aka interim final rules) – this encompasses a lot of rules.
a) Agency makes the proposed rule temporarily final while they receive comments.

G. Mechanisms for externally reviewing rules in a non-judicial fashion

1. President
a. Reagan = E.O. 12291 - amended by Clinton with EO 1866 (below);
b. Clinton = E.O. 1866 – amended by Bush with EO 13,258
c. Bush = E.O. 13258
d. All these were in response to the idea that administrative rules were becoming overly burdensome and rather
than having agencies promulgate what were perceived as being overly burdensome rules, they wanted some
cost-benefit analysis to take place before promulgation.
e. Each one of these executive orders has vested some authority in the Office of Management and Budget (OMB).
2. Congress
a. Legislative veto – when congress used its authority (usually w/just one house) to override particular agency
decisions. This was declared unconstitutional by:
a) INS v. Chadha (U.S. 1983) – Chada was awarded a suspension of deportation, and he was one of half-
dozen that the House of Representatives had dcided had been unfailrly awarded this suspension of
deportation, and so they vetoed the agency’s determination.
i. This was adjudication not rulemaking, but the language of the SCOTUS opinion was sufficiently
broad that it struck down all legislative vetos whether they were dealing with rulemaking or
adjudication.
b. Contract with America Advancement Act of 1996 – this requires that agency rules be submitted to Congress w/
the thought that Congress may in certain circumstances act with the President’s signature to enact legislation
that overrides rules.
a) As a practical matter, this has not involved a large number of rules being overridden. However, there was
an extensive rulemaking towards the end of the Clinton era that would have imposed ergonomic
restrictions on employers, and this was overridden by Congress.
 b) This is not unconstitutional b/c the holding in Chada only applied to situations where one chamber of
Congress was acting on its own w/out the president. This CAAA of 1996 requires bicameralism and
presentment to the president.

H. Bias and Ex Parte Contacts in Rulemaking

1. Bias standard much, much harder to show in rulemaking successfully than it is in adjudication.
a. In order to successfully show bias in rulemaking context, you have to show that the agency had an “unalterably
closed mind”.
b. i.e. Agency is not willing to accept and listen to other parties at all.
2. Ex parte contacts
a. Very little regulation of ex parte contacts in informal rulemaking
b. §557(d) applies in formal rulemaking – this section says that external ex-parte contacts are prohibited. This is
because formal rulemaking is the kind that is supposed to be truly limited to the record. Thus the idea of
external ex-parte communications does not sit well with this goal.

I. Agency’s Discretion to Choose Between Rulemaking and Adjudication – I NEED TO EXPAND ON THIS WITH NOTES AND CASES
FROM BOOK AND E&E.
1. Are there circumstances where an agency just doesn’t have a choice? That is to say if they’re going to make a policy,
they have to do it through rulemaking rather than adjudication?
2. The Supreme Court has said that agencies have very broad, nearly unlimited discretion to choose between the two.
3. There may be circumstances where the parties have settled expectations, and upsetting those settled expectations
might be arbitrary, and arbitrary and capricious decisions by the agency can be set aside.

V. Agency Information Gathering

A. Raises difficult policy issues b/c - clash between desire for privacy and accomplishments of regulatory objectives.

B. Agencies are given three important devices for gathering information:

1. Searches or inspections
2. Record-keeping or reporting requirements
3. Subpoenas
a. Testifying
b. For production of documents or tangible things

C. Searches or Inspections
1. Agency must have statutory authority to engage in inspections or searched
a. Extremely common for Congress to grant an agency this power
2. Must comply with the Fourth Amendment
 a. Fourth Amendment limits agency officials
b. Warrant Requirement
a) Normally a warrant is required; must be issued by a neutral magistrate.
b) Warrantless searches are allowed in the agency context if certain conditions are met. Three step test:
i. It has to be a pervasively regulated industry;
1. Alcohol, Tobacco, Firearms, others with long history
2. Others are more recently regulated, such as auto junkyards (single industry regulations).
ii. Also has to be a statute providing parties notice that a search may occur
iii. There was to be a true administrative purpose for the search.
1. However, “mixed” motive approved.
c. Warrantless searches do not require individualized suspicion.
a) Agencies can search on a neutral scheme. Don’t need probably cause or anything of the like.
d. Remedy if agency violates the Fourth Amendment = exclusion of evidence
a) Normally the rule in criminal cases
i. But subject to good faith limitation.
ii. Generally no exclusion in administrative matters.
e. Plain view exception
f. Hypothetical #16: Bob owns a gun repair business. A federal statute allows ATF agents to make unannounced
inspections at random to ensure that gun dealers and repair shops are keeping proper records of their
transactions. The name of Bob’s store is selected at random; there is no particular reason to believe that Bob is
violating the law. While in the store inspecting the records, the ATF agents see several illegal assault weapons
leaning in the corner. The assault weapons are seized, and Bob is prosecuted. He attempts to suppress the guns
as the fruit of an illegal search.
a) Was the warrantless search permissible? It looks like it is.
b) Pervasively regulated industry? Yes. Gun industry.
c) Statute giving notice that the search might occur? Yes.
d) Administrative purpose? Yes, checking for regulatory violations.

D. Record-keeping and Reporting – i.e. tax returns.

1. Agency has to have statutory authority
2. Bare showing of relevance
a. “Official curiosity” can suffice
3. Not outrageously burdensome

E. Subpoenas - two types of subpoenas

1. Testifying subpoenas
a. Generally must object to specific questions
2. Subpoenas Duces Tecum
 a. These subpoenas command witnesses to bring records and tangible things.
b. Requirements for a subpoena duces tecum:
a) Statutory authorization
b) Agency or party to agency proceedings
i. Bare showing of relevance
ii. Reasonable specificity
iii. Not outrageously burdensome

F. Privileges limitations
1. Ordinary evidentiary privileges such as attorney-client apply.
2. Fifth Amendment privilege against self-incrimination – people think that the 5 th Amendment would prevent the
witness from being forced to turn over a document that would expose you to criminal liability. However, that is not
the law.
a. The 5th Amendment privilege does not apply simply because documents incriminate.
b. In order for the privelege to apply, the act of producing documents must incriminate (the act of turning it over
must be testimonial). This is called the act of production immunity/privilege.
a) It could help to authenticate the documents.
b) It could mean that the documents were in the witness’s possession,
c) It could show that they actually exist.
d) Testimonial component must be more than a “foregone conclusion."
c. Other reasons Fifth Amendment is a slight limitation
a) Corporations have no privilege.
b) Agencies can draw negative inferences from invocation of Fifth Amendment (the reason you’re invoking
5th Amend is that you’re really guilty).
c) If there is no risk of prosecution, the prosecuting authorities may be willing to give immunity.
i. “Use” and derivative use from testimonial component only.
ii. The negative criminal consequences can be avoided and witness will have to turn over those
documents.
d) Required Records Doctrine
i. The act or production privilege is a nearly absolute privilege which can only be avoided if there
can be no way to comply and avoid self-incrimination.
ii. Only if no way to comply and avoid incrimination

VI. External Controls on Agencies

A. Generally
1. This is a practically important subject b/c the political process does a fair amount to actually control agencies.
Agencies have been the whipping boy as what has been seen as interfering w/people’s lives so political forces have
limited agencies as to what they can and can’t do.
B. Delegation – in order for agencies to exercise certain powers, they have to be delegated to t hem.
1. Delegation of Legislative Power – ability for agencies to make rules.
a. Delegation of legislative authority struck down twice by SCOTUS in the 1930s as being overly broad.
a) In two cases, the Court held that Congress tried to transfer too much of its power to agencies. These were
New Deal era agencies.
b) SCOTUS was generally hostile to New Deal reforms and held that there was an unconstitutional effort to
shift power from the legislative democratic branch (Congress) to the less democratic agencies.
b. Modern test: “intelligible principle” – this is very generous to agencies. Delegation of legislative authority
only needs to contain an “intelligible principle.” This means that it has to be something that could guide an
agencies discretion. i.e. a statute that said “make any rule you feel like making” woiuld be not contain any
intelligible principle. However delegations as vague as “oublic necessity and convenience” have been upheld.
a) Delegations as vague as “public necessity and convenience” have been upheld
b) Whitman v. American Trucking Ass’ns, Inc. (U.S. 2001)
i. Air quality standards “requisite to protect public health with an adequate margin of safety” upheld
as constitutional. This delegation was upheld by the SCOTUS as passing the intelligible principle
test.
2. Delegation of Judicial Power
a. Potentially runs afoul of Article III of the Constitution – the Article that creates the courts.
a) If you take a literal view of Article III, any attempt to “vest judicial authority” in anything other than a
federal court headed by a judge w/life tenure, etc would be unconstitutional.
b) So how do agencies get around this? Obviously they have to have some adjudicating powers, can you
imagine if everyone who challenged a decision by the social security administration had to go through
federal court in order for it to be constitutional? The court needed to recognize exceptions to Article
III.
i. Northern Pipeline Constr. Co. v. Marathon Pipe Line (U.S. 1982)
1. Three historical exceptions to Article III
a. Military courts
b. Territorial courts
c. “Public rights” matters – this takes care of agencies.
ii. Commodities Futures Trading Commission (CFTC) v. Schor (U.S. 1986)
1. Multi-factor test: might even allow for some private adjudication in front of a venue that is
not a federal court (in front of an agency)
a. Particularized area of the law – couldn’t create an agency that decided all tort
matters or all contract matters, but an agency like the CFTC which dealt only with a
commodity was okay because it was particularized.
b. Searching judicial review
c. Private rights versus public rights
d. Efficiency (ancillary jurisdiction)
 e. Status as independent agency
f. Consent of party
2. Bottom line = after these two cases, it’s going to be very hard to make the argument that an
agency is overstepping its constitutional bounds by acting in a quasi-judicial fashion.
b. Jury Trial Issue
a) The Supreme Court said in Atlas Roofing that there is no constitutional right to a jury trial right in public
rights matters
i. Atlas Roofing v. OSHRC (U.S. 1977)
c. Hypothetical #17: The EPA discovers that DumpCo is dumping TCE into a town’s aquifer. The EPA brings an
administrative enforcement action before an EPA Administrative Law Judge seeking to impose a $50,000.00
penalty. DumpCo objects because the Administrative Law Judge is not an Article III judge, and because there will
be no jury trial.
d. Criminal Matters
a) Article III court must impose any criminal penalties,
b) But, Congress can by statute make a violation of a regulation a crime.

C. Estoppel
1. Promissory or Equitable Estoppel
a. Apparently not ever available against the federal government, although Supreme Court has never completely
ruled it out.
2. Res judicata and collateral estoppel
a. Allowed on much same basis as court adjudication
b. Not allowed if a statute precludes it, as with Title VII.
D. Freedom of Information Act
1. Three tiers
a. Records that must be published in the Federal Registry automatically
b. Records that must be automatically made available
c. Records available upon demand
2. Records that must be published
a. §552(a)(1)(d)
a) “substantive rules of general applicability adopted as authorized by law, and statements of general policy
or interpretations of general applicability”
3. Records that must be automatically made available
a. §552(a)(2)
a) Final options in the adjudication of cases
b) Statements of policy not published in the Federal Register
c) Staff manuals
4. Records that must be produced on demand
 a. Agency records must be produced in response to “any request which reasonably describes the records and is
made in accordance with published rules” as to time, place, fees, etc. §552(a)(3)
b. FOIA exemptions:
a) Exemption 1: national defense or foreign policy
b) Exemption 2: internal personnel rules and practices
c) Exemption 3: specifically exempted by some other statute
d) Exemption 4: trade secrets and commercial or financial information
e) Exemption 5: Inter-agency or intra-agency memos or letters not available by law
i. Traditional privileges such as attorney client
ii. NLRB v. Sears (U.S. 1975): pre-decisional v. post decisional
1. Rationale: free exchange of ideas within agency
iii. However, Exemption 5 does not cover documents generated outside the agency and submitted to
the agency. So, in Department of the Interior v, Klamath Water Users (U.S. 2001), the Supreme
Court held that documents prepared by an Indian tribe and submitted to the agency relating to a
water dispute were not covered because they were neither “inter” nor “intra” agency documents.
f) Exemption 6: personnel, medical files of which release would be “clearly unwarranted invasion of
personal privacy” (reaction to avoid identifiers that would allow member of the general public to identify
person)
g) Exemption 7: law enforcement records that would have negative effects such as revealing a confidential
informant or deprive the accused of a fair trial
h) Exemption 8: financial institution regulation documents
i) Exemption 9: geological information relating to wells
5. “Reverse” FOIA
a. generally not available
b. but, implied right found in Chrysler v. Brown (U.S. 1979)
6. Government in the Sunshine Act
a. Theoretically requires agency open meetings
b. But huge exception for open meetings that would be “likely to significantly frustrate the implementation of
proposed agency action.”

E. Executive Controls
1. Appointments
a. Three levels: “officer,” “interior officer,” and “employee”
a) Officers must be appointed by the president and are subject to Senate confirmation.
i. e.g., Cabinet level, agency heads
1. Buckley v. Valeo (U.S. 1976): FEC heads are “officers”
2. Morrison v. Olson (U.S. 1988): special prosecutors are “inferior officers”
b) Inferior officers
 i. Can be vested in “the President alone, in the Courts of Law, or in the Heads of Departments”
1. e.g., subcabinet level (undersecretaries)
2. Removal
a. Old distinction
a) Myers v. U.S. (U.S. 1926): Officers exercising “purely” executive functions must be removable at will of
president
b) Humphrey’s Executor v. U.S. (U.S. 1935): Persons exercising quasi-judicial and quasi-legislative authority
can be given tenure protection
c) This distinction is what makes independent agencies possible
b. New test under Morrison v. Olson
a) Do the “removal restrictions impede the President’s ability to perform his constitutional duty”
F. Legislative Controls
1. Legislative held veto unconstitutional in INS v. Chadha
2. But “report and wait” constitutional
a. Contract with America Advancement Act of 1996
3. “Informal” controls such as budget hearings
G. Venue: Generally determined by enabling act
1. SEC: Federal District Court
2. FERC: Regional Circuits
3. FCC: D.C. Circuit
H. Form of Challenge
1. Old writ distinctions abolished
2. Liberally allowed under 5 U.S.C. §703
3. Injunction or declaratory relief most common

VII. Preconditions of Judicial Review – these things ned to exist before the party can even get into court to challenge the action.
A. Standing
1. Injury in fact
a. Generally means an injury significantly that above that suffered by the general public.
b. Lujan v. Defenders of Wildlife: Plaintiffs had vague plans to visit an area where wildlife affected. This was held
to be insufficient. injury.
2. Zone of interest – that is supposed to be protected by the agency’s statute.
a. Air Courier Conf. Of Am. V. American Postal Workers Union (U.S. 1991): Postal employees not within “zone” on
suit to prevent private couriers from delivering overnight mail; postal job loss not a “zone” injury.
3. Fairly traceable – the remedy that you want has to have a reasonable chance of addressing the remedy that you seek.
4. Taxpayer Standing – extremely difficult to show in Federal court, although a lot of state courts allow it.
5. Citizen-suit standing – statutes provide for these. These were an invention largely of environmental statutes.
a. Friends of the Earth v. Laidlaw Envt’l Services (U.S. 2000):
 a) Upheld the concept of “citizen-suit” standing, in which citizens or citizen groups are allowed by certain
environmental statutes to bring suit against polluters.
b) Standing is allowed even though the only remedy available to plaintiffs is that a fine will be paid to the
government; the deterrent effect of such a fine gives plaintiffs a sufficient stake in the outcome.
c) The plaintiff, however, must show a specific injury to them; in the Friends of Earth case, this was satisfied
because group members were potentially affected by the defendant’s illegal discharges of
mercury.
6. Hypothetical #18: A statute provides that a proceeding to revoke a dumping permit must be conducted as a “hearing
on the record.” An agency, in violation of this statute, conducts a hearing that does not involve the preparation of a
record. A court reporting company that was supposed to compile the record seeks judicial review to require a new
hearing that is conducted on the record.
a. Injury in fact? Absolutely no question about it. They’ve lost business.
b. Traceable injury? Yes of course. If there’s a new hearing then they will get the business.
c. Zone of interest? Not a chance. The fact of the matter is that the hearing on the record requirement is not
designed to produce full employment for court reporters, it is designed to protect procedural fairness.
B. Final Order rule – this is normally used w/r/t challenging adjudication/orders.
1. This is like the final judgment requirement in federal court.
2. Hypothetical #19: A statute requires the FTC to find “reasonable cause” of a violation of trade regulations before it
institutes an enforcement action against the alleged violator. The FTC makes this finding, and commences an
enforcement action, which is required by statute to be an “on the record” proceeding. The alleged violator seeks
immediate judicial review of the FTC’s finding of reasonable cause to commence the enforcement proceeding.
a. Is there a final order? NOT A CHANCE. The fact of the matter is that the FTC isn’t done. This is an interim order
that means that the hearing is going to go forward. If we let the alleged violator to challenge
b. The reason for this is that we want at most one challenge for the proceeding. The violator here might not even
have to challenge it at all b/c he might win at the hearing.
c. ONE CHALLENGE TO AGENCY PROCEEDINGS, AT THE END.
C. Ripeness – this is usually used w/r/t challenging rules.
1. Usually arises in the context of pre-enforcement challenges to rules.
a. Pre-enforcement challenges = where an agency issues a rule, the party doesn’t like the rule and wants to try to
get it struck down as being an illegal rule? The question becomes, can the party go ahead right then just on the
basis of the fact that the rule has been passed/enacted/taken effect? Or do they have to wait until the agency
had taken action against then which would be an adjudication, then as part of that adjudication, the validity of
the rule could be brought into effect.
a) The answer to this question is sometimes you can challenge the rule, sometimes you can’. You have
to go through the three part ripeness analysis first (below).
2. Three factor test to decide ripeness:
a. “purely legal” question?
 a) Is your argument is that the rule is invalid b/c it is beyond the scope of what the agency is allowed to pass
as a rule?
i. Yes. This is a purely legal question and can be challenged pre-enforcement.
b) Does your argument depend on specific facts that would arise as to whether or not certain conduct is
w/in the scope of the rule?
i. Yes. Probably not ripe.
b. Would court or agency benefit from delaying challenge? Further factfinding?
a) Would there be anything that would be learned?
c. Private party’s interest in challenging – hardship to the parties.
a) Abbot Labs is the illustrative case here. Find it and put it in here.
D. Exhaustion of Administrative Remedies
1. This requires the party to invoke and complete administrative process.
a. Sometimes overlaps w/final order rule.
2. Difference with final order rule –
a. Exhaustion = when party just decides to bypass the agency entirely and to try to go directly to court.
b. What if a party does not bother to get the ALJ’s decision reviewed by the agency heads if they have the ability to
do so?
3. Exceptions:
a. Futility – if it can be shown that there is just no point in going to the agency.
b. Inadequate remedy – if the party wants money damages, injunction, etc., and the agency is not allowed to give
that remedy, the party may be able to go directly to court.
E. Primary Jurisdiction – is this even in the book? I need to find it and outline here.
1. Comes up in situations where there is concurrent jurisdiction between agency and court.
2. Stay while agency is consulted
F. “Committed to Agency Discretion by Law”
1. The keyword here is that there “No law to apply”
a. The agency’s decision is so open ended b/c there is just nothing to review.
2. Heckler v. Chaney (U.S. 1985) – argued that the FDA should have should have been taking enforcement action
against drugs that were being used in a lethal injection of the execution of a prisonor.
a. SCOTUS said that the FDA has prosecutorial discretion and area llowed to go forward or not.
3. United States v. Bean (U.S. 2002) – inaction because of lack of resources to act is not reviewable by courts. Is this in
the casebook? Find it.
G. Statutory Preclusion of Review
1. Sometimes Congress will attempt to just vest the final decision making authority with the agency and not allow
judicial review at all.
2. Statutes read with a heavy presumption that they do not preclude judicial review.
a. So if there is any way to read the statute to allow for judicial review, then that is how it’s going to be read.
3. Potential constitutional issue – i.e. if congress attempted to divest the courts of review of a constitutional issue.
VIII. Judicial Review
A. Four Questions
1. Law – parties might be able to challenge the agency’s legal interpretation of the law.
2. Historical Fact Page – parties might be able to challenge things like which witnesses they believed, which facts they
accepted, etc.
3. Policy
4. Discretion – i.e. whether or not to revoke license or suspend it. Whether to impose $5000 or $10000 fine.
B. Law
1. Can arise in any kind of agency determination – investigation, rulemaking, adjudication, etc.
2. “Mixed” questions of law and fact – what are the parties actually fighting about? If the parties agree on the facts but
disagree on a legal issue, then it’s a legal issue. If vise versa it’s a factual challenge.
3. Once you determine it is a legal issue, use the Chevron analysis:
4. Chevron v. NRDC (U.S. 1984)
a. Three-step test:
a) Is there a clear answer provided by law? If yes, agency has to follow it.
b) If no clear answer, then ask was the agency delegated the authority to resolve?
i. The answer will be yes if it is an area where the agency has expertise.
ii. The answer will be no if it is something like FOIA, etc.
c) Agency’s resolution reasonable?
i. If this an area where the agency isn’t expertise baserd, then it is a de novo review.
b. “Split model agencies” – enforcement arm is separate from the review arm. The enforcement arm gets the
Chevron deference.
a) Martin v. OSHRC (1991): “enforcement” end gets the deference, at least where the issue is ambiguous
regulation
c. Question becomes w/r/t Chevron deference is what is meant by reasonable? The SCOTUS has set out certain
factors that bear on these questions and as a result Chevron deference has become even more flexible. The
following can all affect the amount of deference; informal agency pronouncements may not be within the scope
of Chevron.
a) Formality – some agency person jots out a letter, sends it out, etc. Or more similar to Chevron where
there was notice, comment, etc.
b) Duration
c) Consistency
d) Christensen v. Harris County (U.S. 2000)(plurality opn.)
i. “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.
ii. Is this in the book? Need to find it and brief it.
 d. Rationale and contrast with trial courts
C. Historical Fact
1. Who, what, when, why, how, etc.
a. These usually arise in the context of adjudications.
2. “Mixed” questions of law and fact
3. Usually arise in adjudications
a. If informal adjudication, arbitrary and capricious test applies.
b. If formal adjudication, “substantial evidence” test applies.
4. “Arbitrary and capricious” – in informal adjudication
a. Large amounts of deference to agency – agency’s decision will be upheld as long as they’re reasonable.
b. Can rely on matters outside the “record” if reliable.
c. Citizens to Preserve Overton Park v. Volpe (U.S. 1971) – court articulates a two-step test for this type of
review:
a) The agency’s determination has to be within the zone of permissible decisions
i. Has to be the kind of thing the agency has authority to review.
b) Has to be a not irrational choice made within the zone
5. “Substantial evidence”
a. Strong deference to agency
a) This is like the standard federal court standard for directed verdict
b) “Whole record” approach
b. Must be limited to record and matters judicially noted
c. Agency gets the deference, not the ALJ
a) Universal Camera v. NLRB (U.S. 1951)
D. Policy
1. Usually arises in rulemaking
2. “Legislative” facts
3. “Hard look” at facts and policy implications
a. Quasi-procedural: Were alternatives explored?
b. Quasi-substantive: Is it based on unreasonable policy inferences
E. Discretion
1. Not obviously factual or legal, but calling for judgment
2. Common circumstances
a. admission of evidence
b. penalty imposed
3. “Arbitrary and capricious, abuse of discretion” standard
a. wide latitude
b. in case of penalty, must be shocking or disproportionate
F. Damage Actions as a method of judicial review
 1. Sometimes the only practical route to relief
2. §1983 actions
a. color of state law
b. “persons”
a) doesn’t include states themselves or their instrumentalities
c. no vicarious liability
a) policy requirement
d. immunities
a) qualified
4. ii. absolute
3. Bivens actions
a. federal officials individually
b. lack of “special factors counseling hesitation”
c. immunities
4. Federal Tort Claims Actions

IX. Exam Approach

A. Look for key words
B. Classify the agency action: adjudication, rulemaking, or information gathering
C. Identify the statutory limitations on agency’s actions (principally APA)
D. Identify constitutional limitations on agency’s actions (e.g., procedural due process)
E. Identify any important pre-conditions of judicial review (e.g., exhaustion, standing)
F. Classify the nature of the challenge: legal, factual, policy, or discretion
G. Apply the appropriate standard of review (e.g., de novo, substantial evidence)