Even After the Decision in Bush v. Gore, Our Judiciary Is Still the Least Dangerous Branch
By Randolph J. May
Legal Times, November 9, 2000
Look at that loose-leaf day planner on your desk. Is Wednesday's Supreme Court argument in United States v. Mead penciled in?
If not, it should be. Because this little-noted case provides the Supreme Court with another opportunity to identify which agency decisions merit judicial deference, and how much of it they deserve. As a practical matter, the answers to these questions determine when agency actions create binding legal obligations on the public.
Here are the bare-bone facts in Mead. The statutory tariff schedules of the United States impose a fee on imported "bound diaries." The Customs Service issued a ruling classifying Mead's day planners (loose-leaf books containing calendars, room for daily notes, telephone numbers, addresses, and notepads) as "bound diaries."
Mead argued that its day planners are not diaries-which are used principally for recording past events, as opposed to planning future ones-and therefore should not be subject to the tariff. It also argued that, though its planners are in a loose-leaf format, they are not "bound." The Customs Service disagreed.
On review, the Federal Circuit held that the agency's classification ruling was entitled to "no deference" at all, and accepted Mead's view that the day planners are neither "diaries" nor "bound."
In its brief to the Supreme Court, the United States argues that Customs Service tariff classification rulings are not only entitled to deference, but to the "controlling weight" of Chevron deference. Under Chevron U.S.A. Inc. v. Natural Resources Defense Council (1984), courts must accept any agency interpretation that is consistent with the governing statute and "reasonable."
The solicitor general also argues alternatively that even if the Customs Service's ruling is not entitled to Chevron deference, it is entitled to "some deference" under Skidmore v. Swift & Co. (1944). There, the Court held that an agency's interpretation is entitled to whatever judicial deference it can garner based on its "power to persuade," taking into account the thoroughness and logic of the decision, consistency with prior interpretations, and the degree of expertise the agency brings to the particular question.
Curiously, even as the government's brief invokes Skidmore as a fallback position, it goes out of its way to denigrate the standard and its application:
The open-ended list of factors described in Skidmore, of course, provides only limited guidance to the parties or to the courts. Because the outcome of each dispute would be relatively unpredictable under that formulation, a broad application of that approach would necessarily magnify the volume and cost of administrative litigation. It would undercut the traditional choice that agencies possess in selecting the 'format' in which they elect to issue statutory interpretations.
Or maybe not so curiously. The agencies obviously have an interest in a jurisprudential world in which the strong form of Chevron deference is broadly applicable. Hence, it is not surprising the solicitor general prefers that the agency's decision control, regardless of the agency's choice of "format" for issuing interpretations.
Perhaps the government senses an opening on the deference question, even after last term's decision in Christensen v. Harris County. There, the Court held that a Department of Labor opinion letter interpreting a Fair Labor Standards Act provision was not entitled to Chevron deference. Justice Clarence Thomas wrote for the majority:
Here . . . we confront an interpretation contained in an opinion letter, not one arrived at after, for example, a formal adjudication or notice-and-comment rulemaking. Interpretations such as those in opinion letters-like interpretations contained in policy statements, agency manuals, and enforcement guidelines, all of which lack the force of law-do not warrant Chevron-style deference.
The majority also denied the interpretation Skidmore deference.
Justices Antonin Scalia and Stephen Breyer agreed in concurring and dissenting opinions that Chevron deference should be extended to a considerably broader array of agency actions than those identified in Justice Thomas' opinion.
Now consider that the Court granted certiorari in Mead on May 30, one month after it handed down Christensen. Because the Court did not simply remand Mead to the Federal Circuit for review in light of Christensen, and because Justice Thomas' Christensen opinion uses illustrative language in discussing Chevron's applicability, perhaps the government may be forgiven for assuming that Chevron's applicability remains unsettled after Christensen.
Certainly, Chevron has generated more than its share of confusion. There are several pre-Christensen decisions in which the Court gave Chevron deference to agency actions of the type identified in Chistensen as not warranting such deference. Because agency decisions impact so heavily upon the relationships among the three branches of government, and on the relationship between regulators and the regulated, the Court should use the Mead case to clarify the reach of Chevron. Most important, the Court should emphatically reject the government's invitation to give Chevron a broader sweep.
As Northwestern University law professor Thomas Merrill explains in a very cogent amicus brief (on his own behalf) filed in Mead, the logic of Chevron rests on an implied delegation from Congress. The nondelegation doctrine (at issue in the American Trucking cases that the Supreme Court will hear Nov. 7) requires that every delegation be constrained by an intelligible principle. Within those limits, agencies may fill in the gaps created by statutory ambiguity.
According to Professor Merrill, by insisting that agencies be given the power to act with the force of law before their interpretations are entitled to mandatory deference, "we thus ensure that such delegations are confined to circumstances in which Congress has made a considered judgement" to confer lawmaking power.
There is another reason why Chevron deference should not be extended beyond legislative rules and formal adjudications adopted pursuant to delegated power to make law. Under the Administrative Procedure Act, formal agency actions are subject to procedural rules, such as notice-and-comment or hearing requirements comporting with due process standards, that allow public participation in their formulation. This is not true with respect to informal interpretative actions such as the agency manuals, policy statements, enforcement guidelines, and opinion letters identified in Christensen. Public comment ordinarily benefits agencies' decision-making process, and conversely its absence leads agencies to overreach.
So, what about the tariff classification ruling at issue in Mead? It is not entitled to Chevron deference because, while the statute authorizes the service to issue legislative-type "binding rulings" concerning the classification of particular items, the agency's own regulation states that "ruling letters" like the one issued to Mead are "binding on all Customs Service personnel." It does not suggest that the ruling is binding on private parties or the courts. The classification determination was not issued in accordance with the public participation that typically accompanies the promulgation of legislative rules or formal adjudications.
At most, it should receive Skidmore deference. While the solicitor general is correct that Skidmore's open-ended formulation leaves the outcome of each dispute less predictable than if Chevron deference is applied, this is a small price to pay for achieving greater agency accountability.
As administrative law expert Robert Anthony, a law professor at George Mason University, has stated: "In the area of nonlegislative rules and similar agency actions not having the force of law, the Court just doesn't get it." Presumably, the Supreme Court took the Mead case so soon after Christensen to give itself yet another opportunity to "get it."
In this case, that means clarifying that agencies may not bind citizens through the issuance of various kinds of informal rulings and guidance that they have no delegated authority to enforce and that are usually formulated without soliciting public input. The justices should pencil that in for Nov. 8.
Randolph J. May is a senior fellow and director of communications policy studies at the Progress & Freedom Foundation in Washington, D.C. The views expressed are his own and do not necessarily reflect the views of the foundation.
© 2000 Legal Times. All rights reserved. This article is reprinted with permission from Legal Times.