The most important point to make about the Supreme Court's decision in State Farm is that the Court required the agency to undertake procedures beyond what the agency could reasonably have expected was required before the Court delivered its verdict. Specifically, the Court Required the agency to examine all the alternatives, which was something that the courts had never previously that required an agency even attempt to do.
This aspect of state farm is particularly important in light of the subsequent decision in Vermont Yankee because the claim in Vermont Yankee could be characterized as an allegation that the agency had failed to consider a very relevant alternative, and the decision in State Farm appears to require extensive additional procedures (the consideration of all reasonable alternatives) that are not easily found in the APA.
Most of you chose to argue that State Farm is consistent with Vermont Yankee (although I was happy to accept either answer). The argument for this side emphasizes that Vermont Yankee only holds that courts will not require agencies to use additional procedures beyond those specified in the APA and that in State Farm the court was instead concerned with the requirements imposed by section 553 of the APA. In particular, this line of argument emphasizes that the record produced by the NHTSA in State Farm failed to give a sufficient explanation of its reasons, regardless of the requirement to consider other alternatives. Other embellishments on the argument include the assertion that the regulatory context was significantly different and that an agency making a new rule about nuclear power deserves to be treated differently from an agency that is reregulating an area that has received intense attention.
Another distinction that many of you found useful was to characterize State Farm as "substantive" and to characterize Vermont Yankee as "procedural". In this view, the command of Vermont Yankee is not infringed when the Court decides that an agency's decision is insufficiently well explained. As the better answers of this type noted however, the distinction between substance and procedure is not a sharp one at the best of times and this situation is not the best of times.
The best answers noted that they needed to make a number of simple but important assumptions: the secret service is an executive agency (it is); the APA applies (it does); there is no special exclusive provision applicable under APA § 701 (there isn't).
The better essays also noted that there were several places one might look for relief: the due process clause of the Fifth Amendment, the first Amendment, the APA, and the agencies own statutes and regulations (which you weren't given, so you couldn't do much more than mention the possibility).
Constitutional due process provides for notice and hearing before a "property interest" is taken away. Roth. The difficult question on these facts is whether a reporter's interest in covering the white house rises to the level of a"property interest". Since one of the Roth factors is the right to engage in any of the common occupations of life" there is that least a case to be made that the right to cover the white house is protected. Even if it is not be strongest case in the world. One could also argue that the denial of the rest as was stigmatizing for the reporter which would also trigger a right to a due process hearing. Better essays also considered whether the facts of this case were sufficiently close to those of Webster v. Doe to fall under the national security exception in that case.
As many of you correctly noted, it is difficult to imagine that the reporter could prevail under the tests in Mathews v. Eldridge given the large weight quickly to be put on the President's safety as compared to the reporter's interest in pursuing a career. There is no Goldberg type right to a pre-termination hearing.
Too few of you noted that the decision to deny without a written statement was a violation of the APA. There seems little doubt that absent some hypothetical exception in the secret service's statutes, the APA applies because the press pass is akin to a license, APA § 551 (8).
As a few of you noted, there is basically no hope of getting an injunction against the secret Service because the harm is not "irreparable".
I was surprised how few of you noted that the timing of the denial itself suggests that the agency's action was arbitrary and capricious. Since the action is presumptively under the APA, as some form of informal adjudication, these are the sort of facts that might lead a court towards review. At the very least they present a circumstantial case for the forced disclosure of reasons, or if there is no record, for a remand to create one. (Overton park)
Many of you made this question much more complicated than it needed to be. In particular, many of you attacked the difficult standing question of whether the bank would have standing on these facts. Since however, question asks only how you would challenge the rule, there is a simple way to solve the standing problem: add a student plaintiff to the lawsuit. The bank doesn't care who challenges the regulation, it just wants the regulation to go away. It's obvious that law students have standing to challenge this rule since they are directly affected by it.
Stripped of standing problem, the question raises three main problems: first, does the agency have the power to make this rule? Is the rule valid under the Chevron Test? Second, is the difference from the proposed rule to the final rule so great as to require a reopened rule- making? Third, do the Clinton ex parte contacts violate any applicable rules or statutes?
The first question could be argued either way. The important point was to identify both steps of the Chevron Test, and to note the inherent tension within the statute. Unfortunately most people who answered this question failed to comment on the implications of the agency's duty to put ensure that monies are allocated in an efficient and responsible manner. My own feeling is that the courts would probably say that when faced with evidence that law students are abusing the program, the agency would be within its discretion to cut them out entirely. But I was prepared to accept either side so long as it parsed the text and applied Chevron correctly.
The second question could also be argued either way. My gut feeling is that this swerve is pretty large. A good answer on this point would mention that one factor mitigating against the claim that the swerve was to large is that no new issues are raised by the final rule. In other words, any comment which applied to the final rule also applied to the proposed rule. Thus it is unlikely that anybody failed to comment on the rule because they were not on notice as to what it might contain. The major change is in the scope of the effect on law students not on the nature or the group of people affected.
The third question, regarding the ex parte contacts required you to do to things. First you have to make a decision or explicit assumption as to the legal status of Ms. Clinton. Was she a private citizen or was she a government official? Having made this choice you needed to apply the proper standard. {AMF NOTE: THIS ISSUE HAS SINCE BEEN ADDRESSED BY THE DC CIRCUIT...}
Other issues raised by the question included whether the Commission had a duty to publish the Report on which it relied (not if the report was publicly available).
PART A - QUESTION 1
In State Farm the fatal error of the NHTSA was their failure to consider and explain certain evidence in the record. The agency also failed to discuss the possibility of an airbags-only option. The agency failed to explain why it rejected nondetachable seatbelts and why a continuous passive belt would produce the same adverse public reaction as the ignition interlock. In sum, the court felt that the agency failed to consider options which it could have and therefore the decision was arbitrary because it lacked reasoned analysis. The agency could have avoided reversal by discussing the airbags-only option and explained why it would not have been feasible. Also, the agency should have done this at the agency level instead of the appeals court level. Also, the agency should have performed tests on the usage of automatic seatbelts and non-detachable seatbelts.
Vermont Yankee held that courts, except in extremely rare situations, could not force agencies to follow procedures that their statutes did not require. State Farm involved primarily substantive review of agency decisions. At first glance, the two decisions would appear to be consistent with each other. One emphasizing that the court could not impose procedures on agencies while the other allowed the court to give a hard look at the substance and factual basis of their decisions. However, State Farm does appear to be telling the agency that it must produce a record capable of supporting a reasoned decisions in an informal rulemaking. APA §553 which governs informal rulemaking does not require a complete record be produced, only that the agency consider all submissions of evidence and give a concise general statement. So isn't this requiring an additional procedure, exactly what was forbidden in Vermont Yankee? Yes. But this is not a procedure based on fairness and congressional balancing where "political forces have come to rest." This requirement has been implied so as to facilitate a determination as to whether the agency acted within it's discretion. This is necessary for meaningful judicial review.
Vermont Yankee also states that an informal rulemaking "need not be based solely on the transcript of a hearing held before an agency." Also, "the adequacy of the record...is not correlated directly to the type of [procedure]." This can be read to mean that the agency can decide what procedure to employ in creating the record as long as it substantively reasons its decisions based on that record and the record is sufficient to support a finding that the agency reasonably based it's decision on all of it. So, the two opinions are not entirely inconsistent.
PART A - QUESTION 2
This case presents the question of how to challenge an informal adjudication. First would be to find out if there are any remedies/appeals available within the agency and prescribed by the agency's enabling statute. Second, review could be sought under §706 of the APA. (Overton Park) p.708. Third, the procedures could be attacked as unconstitutional under the 14th Amendment.
Since I am unfamiliar with the enabling statute of the Secret Service agency, I will assume that the statute does not provide for additional review and that the agency's decision is final.
The APA provides for judicial review of any legal wrong by the aggrieved party under the relevant statute. APA §702. I assume that the adjudication here is informal since the question does not mention any requirement of a hearing. Accordingly, §706 would allow a court to review the decision as to whether it was arbitrary and capricious. The problem here is that the agency refuses to explain its decision. One solution would be to require the agency to follow any of its own rules or standards in giving reasons and review from there. If the agency was not required to give any reasons, then judicial review becomes difficult. Also, the court may not fashion procedural requirements upon agencies in excess of the APA or their statute unless required by due process. Vermont Yankee) The APA exempts from judicial review agency decisions committed to agency discretion by law. §701. This can apply where review is not to be had "if the statute is drawn so that a court would have no meaningful standard against which to judge the agency's exercise of discretion." (Chaney). Statutory preclusion would most likely be found where the agency has real concerns for secrecy in their decision-making. If this is the case, then review of the decision could not be had and only Constitutional questions could be entertained by the court. (Webster v. Doe).
In order for the court to entertain any Constitutional challenges to the agency's procedures, there first has to exist some liberty or property interest cognizable under the 14th Amendment. Liberty does not encompass the right to be rehired. (Roth). To be a property under the 14th Amendment a person must have a legitimate claim of the property and more than a unilateral expectation of it. (Roth). Statutes can create property rights that will be protected under the 14th Amendment. (Loudermill). In this case it would be a stretch to find a cognizable liberty interest in obtaining a press pass. Even if the court found a protectible interest it would apply the 3 part Mathews v. Eldridge balancing test to determine what process is due. And the interest of the government relating to protection of the President would weigh heavily.
In conclusion, the relief available depends on what relief the statute provides, whether the agency's rules require reasons that could be analyzed as arbitrary and capricious, and whether the court would find a cognizable liberty/property interest.
PART B
Whether a remand or a vacatur is appropriate depends on the error committed below. The Court of Appeals would remand when the error was such that the appeals court could correct it and instruct the agency to comply. This is true when an agency fails to follow procedure or applies an incorrect substantive standard. This is also true when the agency fails to support its decision or fails to base its decision on the whole record. A vacatur is appropriate when the agency applied the correct law to sufficient facts, but nonetheless, for some reason, the decision was still arbitrary and capricious.
The rules in issue, which are not here substantively disputed, require a finding of recklessness. There was no such finding below by either the ALJ or the Secretary. There were however extensive factual findings as well as a finding that Mr. Thompson was "culpable".
The APA, by its terms, does not apply to informal adjudications in prescribing procedures. However, §706(2)(A) applies to all agency action not specifically exempted. This means that the court can set aside agency action that is arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law. This is a "substantial inquiry" and "the court must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment". (Overton Park). An exception is where an agency interprets a governing statutory term. (Chevron). This case concerns an agency interpretation of one of its own rules, namely, whether "culpable" conduct found by the ALJ constitutes "reckless" conduct in the rule of the Defense Department. In this situation, courts should defer to any reasonable agency interpretation not obviously belied by the regulatory language. (Lyng v. Payne0 CB p.739. But the findings below did not make any findings in regard as to whether culpable conduct was indeed reckless and without this conclusion it is impossible to defer to it! Also, the findings of the secretary are entirely inconsistent with the governing rules. In any event, this case presents the issue of applying facts to the law, and must be upheld if it has "warrant in the record and a reasonable basis in law" (NLRB v. Hearst Publications, CB p.746). However, the record below fails to specify which standard was applied. Also, the approval by the Secretary based on possible impairment to the national defense has no relation to whether Mr. Thompson was reckless.
This would warrant a remand back to the agency for a specific finding of whether Mr. Thompson's conduct was reckless under the rule. In this situation, remanding back to the agency for a fuller explanation is the usual remedy. (See Chenery I and Schaffer Transp. Co. v. U.S., 355 U.S. 83 (1957).
As to the contention that APA §706(2) requires a vacatur when the agency has failed to make an adequate record, this contention is without merit. Overton Park is to the contrary: if the "bare record [does not] disclose the factors that were considered or the Secretary's construction of the evidence it may be necessary for the District Court to require some explanation in order to determine if the Secretary acted within the scope of his authority and if the Secretary's action was justifiable under the applicable standard." CB p.712. A remand for a fuller explanation is appropriate here. Also, §706 only prescribes the scope of review and does not require a reversal of decisions made unreviewable due to shortcomings in the record.
The answer might be different if petitioner were appealing an informal rulemaking. Informal rulemaking is also reviewed under the arbitrary and capricious standard. However, courts in this context are more likely to vacate the rule when it is defective. The failure to disclose the relevant portions of the whole record and the inadequacy of a concise general statement has been held sufficient to vacate an informal rule. (Nova Scotia) CB p.486. Also, the failure to explain evidence and offer a "rational connection between the facts found and the choice made" has prompted the Supreme Court to vacate an informal rule. (State Farm) CB p.466. In this case there is no rational connection between selling defective treads and a finding that doing so was reckless. Also, the ALJ failed to address Mr. Thompson's explanation. (see State Farm. Also, the required whole record necessary for review is not available here. And finally, the concise general statement is severely inadequate. This would seem to require that the rule be vacated under the case law.
But these cases were decided under the APA and it is possible that §553 may not apply if this is a "matter relating to...public property, loans, grants, benefits, or contracts". APA §553(a)(2). In this case the only requirements would be the agency's governing statute and the 14th Amendment. The Constitution does not place a very heavy burden on the agency in this context requiring only that any state of facts, reasonably conceived could sustain the rule. Also, there is a presumption that the facts exist. (Pacific States Box) CB p.440. In this context vacating the order would be difficult.