Administrative Law - 24 Oct 2006

Agency Organization

Traditional Government Functions Legislative (Rulemaking) Judicial (Adjudication) Executive (Prosecution)

Why are the separated by the Constitution? What is the problem of combining them in an

agency?

Constitutional v. APA Limits on Combining Functions in Adjudications

The APA provides that should be some separation of functions in adjudications to reduce the conflict between prosecuting and judging a case

This is not a constitutional requirement The United States Supreme Court will allow a

decisionmaker to have other roles There are limits - you have to argue that the

facts make the appearance of conflict overwhelming

Protections for ALJs

Civil Service protections Cannot be assigned other duties - no cleaning the

toilet if the Secretary does not like your rulings Nash v. Bown, 869 F2d 675 (Cir2 1989)

Can have performance goals Cannot have decisional quotas

What if quality control guidelines are biased toward supporting the agency position?

Bias by Agency Heads - Withrow v. Larkin 421 US 35 (1975)

Medical board case Same agency investigated the case, then pulled

the doc's license No problem, at the constitutional level Is there something special about a medical board

case? Who usually sits on a medical board? What is the notice and record issue?

Criminal and Civil Law Parallels in Withrow

Criminal law judges may rule on probable cause warrants and then also preside over the case resulting from the warrant

Civil law judges make many decisions in pretrial proceedings that would bias their ruling in the case

The problem is that there is a jury making the final decision in these cases, not the judge

Valley v. Rapides Parish School Bd., 118 F.3d 1047 (Cir5 1997)

Firing a school superintendent In sum, the record in the case unfolds like a soap opera.

The respective views of the parties were regularly aired out in the print and broadcast media in the Rapides Parish area. One need only make a cursory review of the exhibits and the testimony to get a clear impression of the rancor and deeply held views of the aforementioned school board members prior to the discharge hearing. Indeed, the district court's sparing recitation of the facts underlying its ruling was a tacit acknowledgment of the general public's and the school board's awareness of the details of the accusations in the case.

Court Ruling

Upheld an injunction reinstating the superintendent until the board could give an unbiased hearing

No hint from the court about how that might be done.

FTC v. Cement Institute, 333 US 683 (1948)

FTC issued reports criticizing a certain method of cost analysis

Plaintiff argued that this showed that the commissioners were biased against their business, which relied on this method

Court said this would prevent the agency from carrying out its legilative mandate

American Cyanmid v. FTC, 363 F2d 757 (Cir6 1966)

Chairman of the FTC had investigated drug company while counsel of a senate committee

When the FTC investigated a complaint on the same subject against a drug company, the hearing examiner ruled for the drug company

The Chairman participated in the commission's overturning of the hearing officer, but his vote was not critical

The court found that his participation biased the outcome Would it have mattered if he had done the same at the

FTC?

Association of National Advertisers , Inc. v. FTC

FTC is adopting rules on TV advertising directed at children Chairman has written and spoken at length on

the evils of TV ads aimed at children Plaintiffs seek to disqualify him because of bias

What happened in Cinderella? Cinderella disqualified the same Chairman from

participating in an adjudication because he had prejudged some of the facts.

Is the Standard Different for Rulemaking?

Clear and convincing evidence that he has an unalterably closed mind on matters critical to the rulemaking.

Can the District Court make this into an Adjudication?

Said there were aspects of an adjudication to this rule making because there was a limited statutory right of cross examination

Did the circuit court buy this? Rejected because modifications of

rulemaking procedures do not make them adjudications

How did the Court Characterize the Commissioner's Comments?

Discussion and advocacy What is it going to take to disqualify an

agency head from a rulemaking? Charlton Heston as head of BATF?

Pillsbury Co. v. FTC

What was the FTC concerned about? Monopoly power in flour

How did Congress interfere with the agency action? What did Senator Kefauver say?

The court found this improper meddling Congress may not require testimony on ongoing

adjudications Congress may request information as part of its

congressional casework

Principle of Necessity

What is the Principle of Necessity? Why is the important for small agencies?

Gibson v. Berryhill, 411 US 564 (1973)

Optometry board was all independent practitioners Made it unprofessional for optometrists to work for

employers Why?

Court disqualified the whole agency Necessity does not cover illegal behavior

What if they got the legislature to pass a law preventing employee optometrists?

Successor Cases

Gibson was an extreme case Financial conflicts are only one factor to consider,

not the determining factor Must make a strong factual argument

Morgan I

Statute required a formal rulemaking Looks like a formal adjudication

The Secretary had the power to make the decision Plaintiffs' submitted written briefs to the agency Asst. Secretary conducted the hearing and made

recommendations to the secretary Secretary made the decision based on the

recommendations

How is this Different from a Trial?

What did plaintiffs claim about the Secretary's decision? Did the court allow the Secretary to make the decision if

he did not conduct the hearing? What did it require him to do? Why would this be a problem in a modern cabinet level

agency? This was limited in subsequent cases, which found that

the court should not inquire into the thinking of the secretary, but only look at the record

What can the Secretary Do?

Delegate the right to decide Not always permitted Adjudications often make policy, which the

secretary should control Make the hearing officer's decision final after 30 and

intervene if the case is important to policy Set up an internal appeal process to flag important

cases Decide the case on an executive summary Approve regulations based on expert staff

recommendations