{"id":3062,"date":"2024-06-20T09:00:41","date_gmt":"2024-06-20T13:00:41","guid":{"rendered":"https:\/\/journals.law.harvard.edu\/jlpp\/?p=3062"},"modified":"2025-12-20T16:23:42","modified_gmt":"2025-12-20T20:23:42","slug":"doctrinal-crossroads-major-questions-non-delegation-and-chevron-deference-donald-f-mcgahn","status":"publish","type":"post","link":"https:\/\/journals.law.harvard.edu\/jlpp\/doctrinal-crossroads-major-questions-non-delegation-and-chevron-deference-donald-f-mcgahn\/","title":{"rendered":"Doctrinal Crossroads: Major Questions, Non-Delegation and Chevron Deference – Donald F. McGahn"},"content":{"rendered":"\n
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Doctrinal Crossroads: Major Questions, Non-Delegation and Chevron Deference<\/h2>\n\n\n\n

Donald F. McGahn*<\/a><\/p>\n\n\n\n

Thank you for the kind introduction and the opportunity to speak to you today.  And thank you to the Pacific Legal Foundation\u2014these sorts of conferences are massive undertakings, and require countless hours of thankless work and worry.  I also must note that I am here today on my own accord, not on behalf of any client or my law firm.  But of course, if a future President should make the mistake of nominating me for something in the future, and if anything I say here today is to be used against me or deemed too controversial, then I will say that what I have said reflected a general sense of the world, and not really any of my specific views.<\/p>\n\n\n\n

So on to the topic\u2014Doctrinal Crossroads: Major Questions, Non-Delegation and Chevron<\/em> Deference.  It is certainly now front of mind in not only the world of administrative law aficionados, but among corporate general counsels, think tanks, and the media.  Let me pause on the media for a moment.  If you were to read recent media coverage of this issue set, you would probably assume that the current revolution has been brewing for years, that conservatives have been fighting for decades and decades against Chevron<\/em> deference, and administrative law has been a centerpiece of the conservative movement.<\/p>\n\n\n\n

Not so, not true.<\/p>\n\n\n\n

In reality, for many, many years\u2014until very recently\u2014conservative legal orthodoxy tended to favor and occasionally champion various judicial deference doctrines, under the assumption that it was a version of judicial modesty and restraint.  You would hear this echo from corporate America, the academy, most think tanks, almost all trade associations, and Congress\u2014on both sides of the aisle, particularly from some Senators over a certain age.  It was the Reagan administration, after all, that litigated Chevron<\/em> and then quickly embraced the idea of deference to executive branch agency decision making.<\/p>\n\n\n\n

So, what has changed?  How did we get to this flashpoint in administrative law thinking?  It is not enough to cynically say all things are situational.  Much of the media commentary goes in this direction: Republicans liked deference in the 1980s, Democrats liked it in the 1990s, and on and on.  But partisan advantage, although convenient for cable news talking heads, does not explain where we are today\u2014when the Supreme Court, with a majority of Republican appointees, has not decided a case based on Chevron<\/em> deference since 2016\u2014when a Republican was poised to re-take the reins of the administrative state.<\/p>\n\n\n\n

Perhaps there is something to be said about a generational shift.  Once upon a time, if you were a smart conservative lawyer interested in government and having a job where you could move the needle in your preferred direction, a staff position at the United States Congress was not the place to go.  For decades, Congress was essentially one-party rule.  It uniformly shared a \u201cgovernment can solve problems big and small\u201d mindset, and for a significant period of time, seemed to be in business only to create new administrative agencies claiming to fix yet another perceived problem via vast delegations of authority.<\/p>\n\n\n\n

No, rather than the legislature, the executive branch was the place to go for conservatives, beginning in the 1970s and reaching a crescendo in the 1980s.  When we think of generational lions of the law, names like Scalia and Silberman pop to mind, and with the likes of Bork and Rehnquist and Randolph and Doug Ginsberg, among many others, that generation forged similar career paths, including significant time spent within the executive branch.  And, whether consciously or not, how you come up in your career tends to influence how you see the world.<\/p>\n\n\n\n

But there is more to the story than a simple generational shift, and much more than simply \u201cout with the old and in the new.\u201d  For example: Why then, did these legal giants seem to shift their views later in their careers?  See, for example, the abysmal record of the Obama Administration\u2019s regulatory initiatives before the D.C. Circuit.  Over time\u2014and it is probably safe to say beginning in the 1990s\u2014many of these so-called \u201cindependent agencies,\u201d several of which were created in the 1970s, shifted to become much more dominant and far-reaching.<\/p>\n\n\n\n

Now, independent of what? They never really say, but such agencies have common characteristics.  Usually there is some sort of multi-head, bipartisan structure; where the heads are picked through negotiation between the White House and Senate leadership; who usually cannot be removed without cause; where the terms tend to be staggered and of a duration that ensures that they can outlast a particular presidential administration; where the career staff tend to have outsized powers, or there are administrative law judges that are even more isolated from removal; all with a very broad grant of statutory authority to, and I am paraphrasing, fix things and make the world a better place.  Those sorts of statutes were forged through what folks now call the good ole\u2019 days of legislative compromise. But in reality, no one could really agree on much, so they just kicked it to the agency to do the hard work, and went to the bill signing claiming to have solved yet another perceived problem.  Then there are more recent behemoth statutes, which never really seemed to get a full airing in Congress, but then sailed through the process with a bicameralism and presentment sleight of hand.<\/p>\n\n\n\n

Whether the agency is purportedly independent or not:  When you combine this shiftless approach to governing, with the hubris of the unelected agency people, with courts deferring to all sorts of agency decisions big and small, it ought not be surprising that it all got carried away.<\/p>\n\n\n\n

As one who ran a federal agency for a time\u2014in my case it was the Federal Election Commission, one of these so-called independent agencies\u2014I can say from personal experience that the last source or authority consulted was the statute.  When I would ask, \u201cwhere is that in the statute?,\u201d the answer would invariably be a variant of the same answer: There is this past enforcement matter from 1982, there is this other guidance document from 1988, this came up in a presidential audit in the 1996 election cycle, there is an advisory opinion from 1978.  All these agencies have built up their own version of a common law of the bureaucracy, which drifts farther and farther away from the statute over time.  \u201cGaps needed to be filled,\u201d so they said, and \u201cdo not worry,\u201d they would say, \u201ccourts will defer to us.\u201d<\/p>\n\n\n\n

This steady drift away from statutory authority, without much in the way of supervision, accountability or oversight, mostly flew under the radar\u2014and still does.  There would be some litigation here and there, a few would talk about it, but for the most part, questioning agency power was an underground movement.<\/p>\n\n\n\n

That was because part of this common law of the bureaucracy includes a dazzling array of arguments designed to avoid judicial review.  Litigating against an agency rarely concerns the merits.  Instead, much ink is spilled on jurisdiction, standing, venue, whether there was final agency action, mootness, ripeness, the list goes on and on, all offering courts exit ramps to avoid judicial review of agency action.<\/p>\n\n\n\n

Plaintiffs, for their part, would struggle to challenge a new regulation, only to be thwarted by agency lawyers claiming in court that the regulation was quite necessary and sensible, that it did not really break much in the way of new ground, it merely clarified pre-existing norms, and it was not nearly as expansive as the confused plaintiff was claiming. And in any event, the agency would add, the plaintiff probably lacked standing to challenge the action at all.<\/p>\n\n\n\n

Meanwhile, that same regulation would be read broadly to cover all sorts of new situations in the enforcement context, often shielded from public view, where an unfortunate respondent would rather settle and move on with their lives than be a test case\u2014particularly when their high-paid lawyers would advise that judicial review would lead to nothing more and nothing less than judicial deference to the agency, all but compelling the respondent to settle otherwise meritorious claims.<\/p>\n\n\n\n

Certainly, there were some victories for liberty along the way.  We are now familiar with the tragic tale encountered by the Sacketts in their struggle against the EPA.<\/p>\n\n\n\n

In 2012, the Supreme Court decided Sackett v. EPA<\/em> for the first time.[1]<\/a>  Many of you, I am sure, are familiar with it, and the Kafkaesque regulatory process the EPA inflicted on the Sackett family.  For those uninitiated, allow me to recap the facts, which poignantly capture the many problems of the modern administrative state.<\/p>\n\n\n\n

The Sacketts purchased land near Priest Lake, Idaho and planned to build a new home.[2]<\/a>  But as they were preparing the land for construction, the EPA sent them a so-called compliance order claiming that the Sacketts\u2019 construction was prohibited because their land was covered by the Clean Water Act.[3]<\/a>  <\/em>Even though it was several lots away from any body of water, the EPA asserted that the land<\/em> qualified as navigable waters under the Act and thus, the Sacketts could not fill the land as necessary to build their home.[4]<\/a><\/p>\n\n\n\n

The agency ordered the Sacketts to stop the construction.[5]<\/a>  They had to restore the land to an EPA-approved condition or face up to $32,500 a day in fines.[6]<\/a>  Here is the kicker: the EPA denied the Sacketts an administrative hearing and then argued that the Sacketts lacked any right to challenge the EPA\u2019s actions in court.[7]<\/a>  It seemed Woodrow Wilson\u2019s dream of the so-called experts being free of any influence or interference, even judicial review, had come true.[8]<\/a>  The case made its way to the Supreme Court in 2012 on that last question\u2014whether the Sacketts had any right to challenge the EPA\u2019s actions in court\u2014and the Supreme Court unanimously held that they did.[9]<\/a>  <\/em><\/p>\n\n\n\n

To a group of lawyers and law students this should seem like a pretty straightforward proposition.  A government agency sought to enjoin private individuals from using their personal property and imposed a crushing fine if they failed to comply.  As Justice Alito noted in his concurrence, \u201cin a Nation that values due process, not to mention private property, such treatment is unthinkable.\u201d[10]<\/a>  But to the agency, this was just standard operating procedure.[11]<\/a> The EPA\u2019s authority was beyond debate, so they said.   Such administrative hubris is not isolated to the EPA\u2014it infects all agencies big and small.<\/p>\n\n\n\n

One would think the Supreme Court\u2019s unanimous rebuke would be the end of it, but one would be wrong. For eleven years thereafter, the Sacketts tussled with the EPA and tried to develop their land.  But without success.  Eleven years later, the case returned to the Supreme Court, and just recently, the Court again ruled unanimously in favor of the Sacketts by reaching the seemingly obvious conclusion that the Clean Water Act extends only to wetlands that have a continuous surface connection with \u201cwaters\u201d of the United States.[12]<\/a>  I guess that is why it was unanimous.  But it took eleven years.<\/p>\n\n\n\n

The Sacketts are regular people, not a major corporation with a legal department.  Yet their case took 15 years start to finish, countless millions of dollars in legal fees, and two trips to the Supreme Court before they could build their family home on a 2\/3 acre lot.<\/p>\n\n\n\n

The Sacketts and their courageous fight started to get attention, and helped bring the problems with the administrative state to the fore.  A few of us mentioned it every chance we got.  Back in 2017, over six years ago, the theme of the Federalist Society\u2019s National Lawyers Convention was \u201cAdministrative Agencies and the Regulatory State.\u201d<\/p>\n\n\n\n

While serving as Counsel to the President, I was honored to deliver the Barbara Olsen Memorial Lecture.  During that Lecture, I made a few observations and predictions.  I said:<\/p>\n\n\n\n

\u201cThe greatest threat to the rule of law in our modern society is the ever-expanding regulatory state, and the most effective bulwark against that threat is a strong judiciary.\u201d<\/p>\n\n\n\n

I noted that as a Tenth Circuit Judge, Neil Gorsuch was right when he wrote: \u201cthe fact is Chevron <\/em>and Brand X<\/em> permit executive bureaucracies to swallow huge amounts of core judicial and legislative power and concentrate federal power in a way that seems more than a little difficult to square with the constitution of the framers design. Maybe the time has come to face the Behemoth.\u201d<\/p>\n\n\n\n

I also said: \u201cJustice Scalia\u2019s tragic death put these issues front and center in the 2016 election.  In my lifetime I cannot remember a presidential election that turned so critically on the role of judges.  The President knew this, which is why he issued his list of candidates for the Supreme Court.\u201d<\/p>\n\n\n\n

I also announced 5 more names to the President\u2019s Supreme Court list, including Brett Kavanaugh and Amy Coney Barrett.  <\/em><\/p>\n\n\n\n

I then gave a talk that took a deep dive into major questions, non-delegation, Chevron<\/em> deference, and a host of other problems with the current administrative state.  I even delved into the saga of Chenery I<\/em> and Chenery II<\/em> \u2013 where praising Chenery I<\/em> was an applause line.  Perhaps now the Senate understands why Justice Gorsuch cited Justice Robert Jackson as a major influence?[13]<\/a><\/p>\n\n\n\n

Six years later, standing here today, Barrett and Kavanaugh are both on the Supreme Court, there is an increasing scrutiny on the administrative state, the major questions doctrine is no longer a Kavanaugh dissent in a net neutrality case but is instead the law of the land, and Chevron<\/em> deference is before Supreme Court in Loper-Bright<\/em> and Relentless<\/em>.[14]<\/a>  In the words of the Chief Justice, \u201cthe case is submitted.\u201d<\/p>\n\n\n\n

Now, many late to the game are trying to make sense of what is happening and are struggling to analyze various strands of judicial precedent, often forcing dissonance when they really ought to hear harmony.<\/p>\n\n\n\n

Certainly, the various doctrines find their genesis in different parts of the Constitution and do not apply to all branches equally.  As a matter of analytical purity, Chevron<\/em> empowers the executive to legislate, shifting power away from the legislature, whereas major questions limits the executive and forces congressional action before acting.<\/p>\n\n\n\n

But Chevron<\/em> deference, no matter its fate, is not an isolated doctrine\u2014it is not an exception to some other doctrine, which only matters in certain cases, and only on Wednesdays if we feel like it.  Chevron<\/em> is not separate and apart from major questions, or non-delegation, or final agency action, or standing or all the other barriers that have been erected through the common law of the bureaucracy.<\/p>\n\n\n\n

All of these are subsets of the real issue.<\/p>\n\n\n\n

What is at stake is the presumption that the government wins\u2014and not an elected government making decisions through a constitutional system of limited power, with all of its attendant checks and balances.  By \u201cthe government,\u201d here, I mean the unelected.  Even those who actually win an election inherit a vast bureaucracy with a tremendous amount of inertia, often moving in directions opposite of that upon which the candidate campaigned.<\/p>\n\n\n\n

And appointing your own people?  Good luck\u2014it takes years to work through the Senate\u2019s confirmation process, so especially when it comes to the so-called independent agencies, you are lucky to get your appointees in place by year three.[15]<\/a>  And even then, it is to a multi-headed agency.<\/p>\n\n\n\n

But the delay is not limited to independent agencies.  Critical legal positions are not filled for months and months.  By way of example, when I was Counsel to the President, we did not have a Senate-confirmed head of the Office of Legal Counsel or OIRA until deep into the first year.[16]<\/a>  The effective ending of recess appointments is probably a partial culprit, but regardless, it is yet another example of the federal bureaucracy continuing apace without elected executive supervision.<\/p>\n\n\n\n

Yet in an era when it has become fashionable to label virtually everything a \u201cthreat to democracy,\u201d unelected governance seems exempt from that list curated by the chattering class elites.  Why?  Dare I ask\u2014because it achieves the policy results they seek?  And this anti-democratic world view gets justified by the usual sky-is-falling rhetoric about big corporations causing big problems.  But is that really what this is about?<\/p>\n\n\n\n

Justice Gorsuch certainly does not think so.  In the recent Loper Bright<\/em> argument, he observed:<\/p>\n\n\n\n

The cases I saw routinely on the courts of appeals — and I think this is what niggles at so many of the lower court judges — are the immigrant, the veteran seeking his benefits, the Social Security Disability applicant, who have no power to influence agencies, who will never capture them, and whose interests are not the sorts of things on which people vote, generally speaking.<\/p>\n\n\n\n

And, there, Chevron<\/em> is almost always and, in fact, I didn\u2019t see a case cited, and perhaps I missed one, where Chevron<\/em> wound up benefitting those kinds of peoples. And it seems to me that it\u2019s arguable, and, certainly, the other side makes this argument powerfully, that Chevron<\/em> has this disparate impact on different classes of persons.<\/p>\n\n\n\n

But you\u2019ve left open the possibility that a judge, if left to his own devices, would say the fairest ruling is in favor of the immigrant, it\u2019s in favor of the veteran, and it\u2019s in favor of the Social Security Disability applicant, but because of a fictionalized statement about what Congress wanted when it didn\u2019t think about the problem, the government always wins.[17]<\/a><\/p>\n\n\n\n

Beyond generation shift, beyond the growth of so-called independent and other agencies, Justice Gorsuch really cuts to chase here, and shows there are different schools of thought in play.<\/p>\n\n\n\n

The traditional view\u2014which to most audiences is probably the common view\u2014looks at regulation through an economic lens.  We hear talk of imposing cost-benefit analysis, and how much regulation \u201ccosts,\u201d with incomprehensible figures thrown about.  This is fine as far as it goes.  But frankly, such analyses are based upon projections and economic models.  And who develops those models?  Other government bureaucrats.<\/p>\n\n\n\n

Under President Obama, his team ended any illusion of economic cost-benefit analysis as anything but another tool in the justification toolkit.  The government-centric folks have perfected the art.  Look at the supposed \u201csocial cost of carbon\u201d calculations\u2014these show that cost-benefit analysis is just something that can be cynically manipulated for preferred outcomes.[18]<\/a>  But this, in my view, is what is still being shopped around in most so-called conservative circles as well.  To me, it seems more focused on picking winners and losers via regulatory policy, disguised as pseudo-scientific economic liberty.<\/p>\n\n\n\n

But there is another school of thought, which is much more revolutionary, and incidentally conservative, to which Gorsuch speaks.  To wit: Liberty is a value in and of itself, regardless of economic harm.  It is not based on the whims of corporate America\u2014which may hit your ears a little funny, given the often-repeated myth that big business is conservative.  But given the current wave of virtue-signaling from the corporate world, we must be especially wary of simply picking winners and losers through a corporate or macroeconomic lens.<\/p>\n\n\n\n

And it does nothing to fix the problems encountered by the Sacketts thanks to the EPA; or the Little Sisters of the Poor thanks to the contraceptive mandate, which incidentally, was not in any statute, but simply a creation by regulatory fiat; or the Realtors thanks to the continued rent moratorium when the President himself admitted it was unlawful; or now the fisherman forced to pay for government inspectors\u2014the individual plaintiffs who have been harmed and the plaintiffs in real cases that are changing things.  It is why I also go into detail about the facts in Sackett.  The facts matter, and too often some of these cases turn into law review theoretical discussions, even at the Supreme Court.<\/p>\n\n\n\n

The rule of law, the non-delegation doctrine, enforcement discretion, due process, penalties, so-called \u201cvoluntary settlements,\u201d judicial review, final agency action.  This is where real change can occur, where the emphasis is placed more clearly on the individual forced to navigate an administrative bureaucracy.  As Justice Gorsuch wrote in Kisor v. Wilkie<\/em>:<\/p>\n\n\n\n

Maybe the powerful, well-heeled, popular, and connected can wheedle favorable outcomes from a system like that\u2014but what about everyone else?  They are left always a little unsure what the law is, at the mercy of political actors and the shifting winds of popular opinion, and without the chance for a fair hearing before a neutral judge.\u201d  And in such a system \u201c[t]he rule of law begins to bleed into the rule of men.[19]<\/a><\/p>\n\n\n\n

And to the extent some argue this \u201cgovernment wins\u201d presumption is necessary, that it creates stability and the like, I think Paul Clement put that fallacy to rest when he argued in Loper Bright<\/em>:<\/p>\n\n\n\n

Chevron<\/em> is something only the government could love because every court in the country has to agree on the current administration\u2019s view of a debatable statute.  You don\u2019t get the kind of uniformity that you actually want, which is a stable decision that says this is what the statute means.[20]<\/a><\/p>\n\n\n\n

In other words, \u201c[i]t is emphatically the province and duty of the judicial department to say what the law is.\u201d[21]<\/a>  There have been a number of rule of law wins at the Supreme Court lately.  The Vaccine Mandate, the Student Loan cases, the Eviction Moratorium, Clean Power, WOTUS, all \u201cwon\u201d on the grounds that the President and\/or his administration did not have the power to do what they were attempting to do.[22]<\/a>  We will see how Loper Bright<\/em> and Relentless<\/em> come down in short order.<\/p>\n\n\n\n

But as my time winds down, I would also like to take a moment to highlight what is happening in the lower courts, as they give a window into what the future may bring.  There are a number of circuit judges who, perhaps even more than the Supreme Court, have already begun to put their stamp on the today\u2019s topic.  This is no longer an abstract theory, or fodder for law review articles\u2014there have been a number of stellar opinions written by sitting judges.  And in a change from the past, these sorts of issues are no longer just for the D.C. Circuit.  Certainly Judges Rao, Katsas and Walker continue to pull the heavy oar, but I would suggest reading the work of Andy Oldham, Amul Thapar, Patrick Bumatay, John Nalbandian, Lisa Branch, and David Stras, to name just a few.  Each of these Judges has an unwavering commitment to the principles of textualism and originalism and all are willing to exercise their judicial power to \u201csay what the law is\u201d rather than acquiesce to the sprawling and powerful administrative state. A sampling of some recent administrative law opinions demonstrates the character and integrity of each of these jurists.<\/p>\n\n\n\n

First up was Judge Lisa Branch\u2019s brilliant rejection of the Centers for Disease Control\u2019s (CDC) attempt to halt all evictions during the pandemic.  At the height of the COVID-19 pandemic madness, the Director of the CDC invoked Section 361 of the Public Health Service Act to impose a national residential eviction moratorium.[23]<\/a>  In that order, the CDC noted that \u201c[e]victions threaten to increase the spread of COVID-19,\u201d so the CDC decreed that \u201clandlords are prohibited from evicting a covered person from a residential property for the non-payment of rent.\u201d[24]<\/a> The statute on which this unprecedented decree was saddled simply authorized the promulgation of \u201csuch regulations as . . . are necessary to prevent the introduction, transmission, or spread of communicable diseases from . . . one State or possession into any other State or possession.\u201d[25]<\/a> The statute, of course, does not say a word about housing, or evictions\u2014issues clearly far afield from the CDC\u2019s expertise.<\/p>\n\n\n\n

So a group of landlords sued claiming the CDC\u2019s breathtaking order exceeded the authority Congress vested in the agency, and in all events threatened to impose torrid costs on landlords by preventing them from evicting tenants who failed to pay rent.[26]<\/a>  So the landlords sought an injunction against the CDC. But the majority denied that request, explaining that the injury imposed by the order was not irreparable.  The majority shockingly mused that it could not \u201csee how the temporary inability to reclaim rental properties constitutes an irreparable injury.\u201d[27]<\/a>  Nor did the majority credit the landlords\u2019 claim that many tenants were likely to be insolvent and thus unlikely to fork over months\u2014or years\u2014worth of past-due rent, if and when the CDC lifted its unprecedented moratorium.[28]<\/a><\/p>\n\n\n\n

Judge Lisa Branch, however, was not so easily led astray.  She carefully reviewed the statutory text relied upon by the CDC and found it a thin reed on which to base a multi-billion-dollar regulatory program imposed by a health<\/em> agency to regulate housing<\/em> issues\u2014an area traditionally reserved to the States.<\/p>\n\n\n\n

As she explained, \u201c[i]t is an \u2018ordinary rule of statutory construction that if Congress intends to alter the usual constitutional balance between the States and the Federal Government, it must make its intention to do so unmistakably clear in the language of the statute.\u2019\u201d[29]<\/a> Accordingly, Judge Branch refused to \u201c\u2018read the Public Health Service Act to grant the CDC the power to insert itself into the landlord-tenant relationship without some clear, unequivocal textual evidence of Congress\u2019s intent to do so.\u2019\u201d[30]<\/a>  And because \u201c[t]here [wa]s no unmistakably clear language in the Public Health Service Act indicating Congress\u2019s intent to invade the traditionally State-operated arena of landlord-tenant relations, this clear statement rule supports the conclusion that \u00a7 264(a) does not authorize the CDC Order.\u201d[31]<\/a><\/p>\n\n\n\n

The CDC\u2019s shocking grab of authority, Judge Branch argued, violated the Constitution\u2019s structure and permitted the executive to arbitrarily exercise coercive power over the entire nation without so much as a whiff of approval from Congress.[32]<\/a>  Judge Branch was not alone for long; her brilliant opinion was eventually vindicated by the Supreme Court in Alabama Association of Realtors v. Dep\u2019t of Health & Hum. Servs.<\/em>[33]<\/a><\/p>\n\n\n\n

Judge Amul Thapar has long maintained a similar skepticism of agency authority and the deference doctrines that insulate agency action from judicial review.  As a district judge, and now as a judge on the Sixth Circuit, Judge Thapar has consistently resisted various agency deference doctrines as \u201cabdication by ambiguity,\u201d which interfere with the judicial duty to interpret the law in the first instance.[34]<\/a>  This story is as old as the administrative state itself. Agencies rush past statutory and constitutional limits on their own authority.  But when called on it, they point to deference doctrines to tempt judges to walk the primrose path, avoid difficult decisions, and defer to the executive instead.<\/p>\n\n\n\n

Judge Thapar, however, rejects these doctrines wholesale.  In Duncan v. Muzyn<\/em>,[35]<\/a> for example, various plaintiffs sued the Tennessee Valley Authority Retirement System (TVA) after the TVA cut various pension benefits.  As its first line of defense, the agency asserted Auer<\/em> deference, and claimed the court was compelled to defer to the agency\u2019s interpretation of the appropriateness of its actions under agency regulations.[36]<\/a>  But Judge Thapar rejected that argument summarily.[37]<\/a>  For one, Judge Thapar correctly noted that \u201csimply calling something ambiguous does not make it so.\u201d[38]<\/a>  The language of a provision, Judge Thapar explained, is not \u201cambiguous merely because the parties interpret it differently.\u201d[39]<\/a>  Rather, ambiguity is necessarily comparative.  Where a provision is amenable to multiple interpretations all of which are equally plausible, a provision may be deemed ambiguous.[40]<\/a>  So too where a provision\u2019s language would permit \u201cno<\/em> reasonable interpretation.\u201d[41]<\/a>  But where one interpretation proves superior to others, language is unambiguous, and the task is for the judge to decide the meaning of the law, rather than to defer to an agency\u2019s preferred interpretation.[42]<\/a>  In that case, Judge Thapar rejected the agency\u2019s plea to ambiguity, declined the deference sought, and simply established his own interpretation of what the law compelled.  Ultimately, the agency prevailed in that litigation, but not because of a shadowy deference doctrine counseling judges to stand aside, but rather because the statute Congress wrote foreclosed plaintiffs\u2019 claims.<\/p>\n\n\n\n

The great Benjamin Franklin once mused \u201cin this world, nothing is certain except death and taxes.\u201d[43]<\/a>  <\/sup>But in the Sixth Circuit, Judge John Nalbandian has worked to make certain that individuals harmed by final agency action retain the right to pre-enforcement review.  CIC Servs., LLC v. IRS<\/em>,[44]<\/a> provides a perfect example.<\/p>\n\n\n\n

The issue there was a new tax policy.  Congress passed an innocuous statute requiring taxpayers to maintain and submit records pertaining to certain reportable transactions.[45]<\/a>  But the statute did not define \u201creportable transactions\u201d and instead delegated to the Secretary of the Treasury and the IRS the obligation to define reportable transactions.[46]<\/a>  The IRS did so with a guidance notice extending the reporting requirement to certain transactions between a parent company and a captive insurer under its control.[47]<\/a>  Once deemed reportable, a taxpayer is required to disclose these transactions to the IRS at threat of severe civil and criminal sanctions.[48]<\/a>  <\/em><\/p>\n\n\n\n

But there were some outstanding questions about the substance and procedure by which the IRS\u2019s new definition was implemented.[49]<\/a>  For one, the agency did not go through notice-and-comment rulemaking.  Instead, it decided to simply publish some thoughts, i.e.<\/em>, a guidance document, mandating reporting on an entirely new class of transactions, without ever giving regulated industry an opportunity to offer comment or object to the novel interpretation.[50]<\/a><\/p>\n\n\n\n

So a tax advisor filed suit asserting various challenges to the guidance, including that the IRS violated the Administrative Procedures Act (APA) by failing to offer notice-and-comment proceedings, and by publishing arbitrary and capricious guidance.[51]<\/a><\/p>\n\n\n\n

Ignoring the substance of the claim, the Sixth Circuit majority found the suit barred under a capacious view of the Anti-Injunction Act (AIA) since the plaintiff\u2019s claim concerned the IRS and was thematically related to the collection of taxes.[52]<\/a><\/p>\n\n\n\n

But Judge Nalbandian dissented.  He explained the suit was not a challenge to the collection of a tax, but rather a claim challenging the procedures<\/em> by which the IRS issued its arbitrary guidance document.[53]<\/a>  Such APA challenges, Judge Nalbandian explained, are favored in the law, and fall outside of the reach of the AIA because they do not challenge the imposition of a tax.[54]<\/a>  Moreover, Judge Nalbandian recognized the absurdity of the majority\u2019s manufactured Hobson\u2019s choice:<\/p>\n\n\n\n

Under the majority\u2019s decision, CIC now only has two options: (1) acquiesce to a potentially unlawful reporting requirement that will cost it significant money and reputational harm or (2) flout the requirement, i.e., \u2018break the law,\u2019 to the tune of $ 50,000 in penalties for each<\/em> transaction it fails to report.  See<\/em> 26. U.S.C. \u00a7 6707(a)\u2013(b). Only if it (or someone else) follows the latter path\u2014and only when (or if) the Government comes to collect the penalty\u2014will any court be able to pass judgment on the legality of the regulatory action.[55]<\/a><\/p>\n\n\n\n

In all events, Judge Nalbandian noted, \u201cplaintiffs who do follow that path are not only subject to financial penalties but also criminal penalties.\u201d[56]<\/a><\/p>\n\n\n\n

The majority\u2019s view was wrong because under it, \u201cthe only lawful means a person has of challenging the reporting requirement . . . is to violate the law and risk financial ruin and criminal prosecution. . . . And it leaves [Plaintiff] in precisely the bind that pre-enforcement judicial review was meant to avoid.\u201d[57]<\/a><\/p>\n\n\n\n

The practical implication of the majority\u2019s errant view would render vast swaths of Treasury and IRS guidance unreviewable by federal courts\u2014a result at war with the presupposition that government action is subject to review by a neutral arbiter.[58]<\/a><\/p>\n\n\n\n

Vindicating Judge Nalbandian\u2019s approach, the Supreme Court reversed the Sixth Circuit\u2019s erroneous opinion 9-0, in an opinion mirroring Judge Nalbandian\u2019s analysis.[59]<\/a><\/p>\n\n\n\n

Judge Patrick Bumatay has similarly written on the importance of judicial review of agency structures without mandating plaintiffs submit themselves to arguably unconstitutional proceedings to obtain judicial review.<\/p>\n\n\n\n

Many administrative agencies have established in-house \u201cjudges\u201d (ALJs) who are empowered with the authority to host judicial-like proceedings (hear testimony, host evidentiary hearings, apply law to facts, and impose penalties for regulatory or statutory violations).  These judges are not independent in any real sense\u2014they are part and parcel of the prosecuting agency, and often demonstrate a real bias toward the agency\u2019s perspective.<\/p>\n\n\n\n

The FTC is one such agency.  Its ALJs exercise judicial functions over FTC enforcement proceedings and may enter final orders punishing or penalizing regulated entities.[60]<\/a>  In the general course, those final orders are subject to review in a court of appeals, only after the administrative process has been concluded.[61]<\/a><\/p>\n\n\n\n

In Axon<\/em>, the FTC initiated an investigation claiming Axon\u2019s purchase of a close competitor constituted a violation of the FTC Act\u2019s ban on unfair methods of competition.[62]<\/a>  As that proceeding dragged on, Axon filed suit in a district court raising various constitutional issues including that the FTC\u2019s ALJs were unconstitutionally entitled to dual-layer removal protection, and that the FTC\u2019s mix of adjudicative and prosecutorial functions violated the separation of powers.[63]<\/a>  Good points on both counts.  The question presented was whether Congress, in establishing a mechanism by which final agency action could be reviewed by a court of appeals necessarily ousted jurisdiction for district courts to hear constitutional challenges to the agency\u2019s structure and function.[64]<\/a><\/p>\n\n\n\n

The Ninth Circuit majority said yes.[65]<\/a>  It held that that, by vesting courts of appeals with authority to review final agency actions, Congress had \u201cimpliedly precluded district court jurisdiction over claims of the type brought by Axon.\u201d[66]<\/a>  But Judge Bumatay disagreed.<\/p>\n\n\n\n

To Judge Bumatay, the background presumption was that \u201cCongress intended subject matter jurisdiction in the district courts for all claims arising under federal law.\u201d[67]<\/a>  And \u201c[a]bsent legislative language to the contrary, challenges to an agency\u2019s structure, procedures, or existence, rather than to an agency\u2019s adjudication of the merits on an individual case, may be heard by a district court.\u201d[68]<\/a><\/p>\n\n\n\n

The majority tried to subject the regulated party to an impossible choice.  It could submit to the agency\u2019s potentially multi-year process, and obtain judicial review on the back end, after having been subjected to what Axon claimed to be unconstitutional proceedings.[69]<\/a>  This option, of course, assumes the agency would not strategically moot the case, and that Axon does not prevail before the agency.  In either case, there would be no appealable order and Axon would be forever barred from raising its constitutional claims before an Article III court.  On the other hand, Axon could intentionally lose before the FTC to ensure itself a forum for adjudication of its constitutional claims.[70]<\/a>  But such a requirement would brush up against the well-established presumption that parties need not risk \u201c\u2018severe punishment\u2019 \u2018before testing the validity of [a] law.\u2019\u201d[71]<\/a><\/p>\n\n\n\n

In other words, the majority\u2019s view would \u201ceffectively shut the courtroom doors to a party seeking relief from alleged constitutional infringement.\u201d[72]<\/a><\/p>\n\n\n\n

On certiorari, the Supreme Court unqualifiedly agreed with Judge Bumatay\u2019s dissent and entered an opinion in which all nine justices agreed the courthouse doors remained open for litigants to assert constitutional challenges to agency action without awaiting the conclusion of an agency\u2019s prosecution or enforcement proceedings.<\/p>\n\n\n\n

Respect for separation of powers also animated Eighth Circuit Judge David Stras\u2019s brilliant opinion regarding judicially-created causes of action.  In Ahmed v. Weyker<\/em>,[73]<\/a> the court confronted a messy situation. A federally-deputized police officer had falsified records and induced the arrests of and criminal complaints against several citizens based on her lies.[74]<\/a>  The arrestees, upon being cleared, filed Fourth Amendment, false-arrest, and damages claims against the lying officer.  The suit against the officer in her state capacity was easy: 42 U.S.C. \u00a7 1983 allows damages suits to vindicate violations of federal law committed by state officers.  But no such statute exists for obtaining damages against federal <\/em>officers for violations of federal law.  Yet, the plaintiffs also asserted a so-called Bivens<\/em> damages claim against the officer in her federal capacity.[75]<\/a><\/p>\n\n\n\n

In times past, courts have operated beyond their constitutional mandate to fashion new remedies for rights even where Congress has declined to do so.[76]<\/a>  The inspiration for this judicial adventurism derives from ethereal notions of justice and concert to see wrongs made right; but there is no tether to law.  Yet law is what judges are empowered to interpret and apply.[77]<\/a><\/p>\n\n\n\n

Engaging in the essentially legislative act of creating new causes of action, and imposing financial liability on the Federal government without Congress\u2019s consent is, as some courts have explained, \u201c\u2018disfavored\u2019 judicial activity\u201d[78]<\/a>\u2014but I will put be less polite: the Bivens<\/em> project is pure lawlessness.<\/p>\n\n\n\n

Judge Stras agrees.  In his opinion for the Court, Judge Stras found the Bivens<\/em> line of cases to be out of fashion and outside the constraints of law.  He explained that Congress<\/em>\u2014not courts\u2014is the body \u201cequipped\u201d to \u201cweigh the costs and benefits of creating \u2018a new substantive legal liability.\u2019\u201d[79]<\/a>  And he refused to extend the wrongly-decided Bivens<\/em> line of cases to a new context not authorized by the elected Congress.[80]<\/a><\/p>\n\n\n\n

Underlying his analysis was a deep respect for the separation of powers.[81]<\/a>  <\/em>Judges lack the competence, and indeed, the authority, to legislate from the bench, creating new substantive liability for the Federal government.  That task belongs solely to Congress, which must face the music for its action, and indeed, its inaction.  Wresting that unique authority from the elected branches to the judiciary violates the structure of our Constitution and stunts legislative innovations.  In such an enterprise, Judge Stras would have no part.<\/p>\n\n\n\n

Then there are the recent Fifth Circuit opinions authored by Judge Andy Oldham, which really capture all that is being discussed here today.<\/p>\n\n\n\n

First up: Louisiana v. Dep\u2019t of Energy<\/em>,[82]<\/a> where several states, led by Louisiana, brought a suit challenging one of DOE\u2019s many recent actions drastically regulating the energy and water usage of dishwashers and laundry machines.  The Fifth Circuit agreed the agency\u2019s action was arbitrary and capricious.[83]<\/a>  Now, arbitrary and capricious sounds decidedly old-fashioned, and is not one of the current doctrines that is usually uttered in settings such as this.  But in the hands of the Fifth Circuit, it is now.<\/p>\n\n\n\n

Here\u2019s the background: Obama\u2019s DOE supercharged the energy efficiency standards program to limit the amount of electricity and water various household appliances could use, meaning the machines we all rely upon would take an absurdly long time and would not work well.[84]<\/a>  During the Trump Administration, a group petitioned DOE to fix the rules since, as the Fifth Circuit characterized their petition: \u201cthe Department\u2019s burdensome energy regulations made dishwashers incapable of, well, washing dishes.\u201d[85]<\/a>  In 2020, DOE adopted final rules addressing some of the concerns for dishwashers and laundry machines.[86]<\/a><\/p>\n\n\n\n

So clean clothes and clean dishes for all?  Not so fast.  On the day of his inauguration, President Biden issued an Executive Order directing DOE and other agencies to reconsider certain rules, including the 2020 Dishwasher Rule and the 2020 Laundry Rule.[87]<\/a>  By 2022, DOE had issued a Repeal Rule, revoking both rules.[88]<\/a>  A lawsuit ensued.<\/p>\n\n\n\n

As usual, the Feds made the usual arguments designed to avoid judicial review, and the court dispensed with those in short order, yet did so with a rhetorical flourish one does not typically see when talking about jurisdiction.  Relying on a D.C. case from 2021, which summarized forty years of past decisions, the court said:<\/p>\n\n\n\n

\u201cDOE gives us no reason to depart from this long-held view of our sister circuit.  Instead, it argues that federal standing doctrine should embrace a Government-always-wins rule. Its argument goes like this:<\/p>\n\n\n\n