Is the “Auer” at Hand to Reconsider Seminole Rock Deference?

Regular readers may recall an essay I posted a few months back, which I wrote for the Pacific Legal Foundation’s law student writing competition. In that essay, I discussed the administrative law doctrine known as Auer (or Seminole Rock) deference, and I highlighted recent calls for reconsidering or abrogating the doctrine. As I stated there:

Auer . . . w[as] ill-conceived as a matter of constitutional law, statutory law, and policy. . . . Auer creates serious separation of powers problems by vesting agencies de facto with the judicial power in a manner contrary to the letter and spirit of Article III. . . . Auer ignores the unambiguous mandate of the Administrative Procedure Act (APA), which instructs courts themselves to “determine the meaning . . . of the terms of an agency action.” . . . Auer creates perverse incentives for administrative agencies to “promulgate mush” by tipping the regulatory playing field in this way, allowing them to clarify ambiguous regulations via interpretive rules or informal guidance not subject to the requirements of the APA . . . . This misbegotten judicial doctrine should be swept into the dustbin of bad precedent.

Back in 2015, three justices had separately called for reconsidering Auer deference in Perez v. Mortgage Bankers Association. There, Justice Alito expressed his interest in reconsidering the doctrine, stating that he “await[s] a case in which the validity of Seminole Rock may be explored through full briefing and argument.” Justice Thomas stated unequivocally that he thinks Auer “undermines our obligation to provide a judicial check on the other branches, and it subjects regulated parties to precisely the abuses that the Framers sought to prevent.”

Since then, the Court has had several opportunities to reconsider Auer, but in each instance the Court has declined. For instance, in Gloucester County School Board v. G.G., the School Board appealed an adverse ruling by the Fourth Circuit and explicitly asked whether the Court should “retain the Auer doctrine despite the objections of multiple Justices who have recently urged that it be reconsidered and overruled?” The Court granted certiorari in the case but dodged the Auer question by granting cert to only the second and third questions presented. The case was ultimately remanded without opinion anyway.

In United Student Aid Funds v. Bible, the Court denied certiorari in a case that asked pointedly “[w]hether Auer . . . should be overruled.” Justice Thomas dissented from the denial of certiorari, noting that “[a]ny reader of this Court’s opinions should think the doctrine is on its last gasp” and that “[t]his case is emblematic of the failings of” the doctrine. Justice Thomas pointed out that four justices have, at separate times, called for reconsidering Auer: himself, Justice Alito, Justice Scalia, and Chief Justice Roberts. He did not prevail in convincing the Court to do so in Bible, however, quite possibly due to Justice Scalia’s passing, which left only three apparent Auer skeptics on the Court–not enough to grant certiorari when the Court considered Bible.

Justice Scalia’s seat, however, has since been filled by Justice Gorsuch, an even more vocal skeptic of the Court’s administrative law jurisprudence. That means there may once again be four votes to grant certiorari in a case squarely presenting the Auer deference issue. All that is needed is a case providing a clean vehicle to do so.

Cue Garco Construction, Inc. v. Secretary of the Army. On Monday evening, attorneys at Consovoy McCarthy Park filed a petition for certiorari in this case, on behalf of Garco Construction. Leaving no room for doubt, the petition’s only question presented is,

Whether Bowles v. Seminole Rock & Sand Co., 325 U.S. 410 (1945), and Auer v. Robbins, 519 U.S. 452 (1997), should be overruled.

Leaning on several of the justices’ own recent expressions of concern, the petitioners go on to argue that Auer

allows self-interested agencies to dictate the meaning of their own ambiguous regulations, deprives those who must labor under them of fair warning, raises serious constitutional questions, and encourages agencies to abuse the Administrative Procedure Act’s exceptions to notice-and-comment rulemaking.

In truth, if what the Court has been awaiting is a non-politically-charged case offering a clean vehicle for expressly reconsidering Auer, then Garco Construction has but three words: I’m your Huckleberry.

At the Federal Circuit, the case was decided in favor of the government after the court applied Auer deference to a regulation Garco Construction argued was not ambiguous in the first place. The court disagreed by looking to “surrounding language” in the regulation, despite acknowledging Garco’s better argument that the regulation’s “plain meaning” was clear.

Garco Construction now asks the Court to reconsider Auer deference directly:

[W]hether Seminole Rock and Auer should be overruled is an important federal question. . . . those decisions are incorrect and should not be upheld . . . . this is the ideal case to decide the question.

As petitioners argue, the doctrine of “Auer . . . creates an obvious incentive for agencies to ‘write substantive rules more broadly and vaguely, leaving plenty of gaps to be filled in later . . .'” The problem, as petitioners explain, is that this “filling in” process occurs informally–leaving regulated parties in the dark–and receives the insulating benefit of deference when a party challenges a “filled in” regulation in court. This doctrine thus “denies ‘fair warning of the conduct a regulation prohibits or requires.'”

Auer also allows, in essence, an agency to be a “judge in its own case,” which is contrary to fundamental principles of Anglo-American jurisprudence, insofar as the doctrine allows an agency to create a law, enforce that law, and then interpret that law. As the petition notes,

That concern is acute here. The government was a party to the contract at issue. Garco argues that the government violated it by restricting the labor pool in ways that contradicted the plain meaning of the regulation that was in place when the agreement was formed. In any other setting, a neutral arbiter would decide who had the better reading of the regulation. Yet unless its interpretation is simply implausible, the government gets to decide if it owes Garco money for violating the contract. That is the very definition of self-interest.

Defenders of Auer often point to its pragmatic virtues to offset the vices Garco highlights, but this petition ably calls those arguments into question as well. “Allowing agencies to issue vague rules and then to refine them as they go is inefficient.” Such ad hoc regulation “inevitably spawns litigation over the legality of the ‘interpretative’ guidance as to both process and substance.”

Garco argues “[i]t would be wiser to discourage the agencies from taking these short cuts around notice and comment.” Even granting the alleged virtues of Auer, “Convenience and efficiency are not the primary objectives–or the hallmarks–of democratic government.” INS v. Chadha, 462 U.S. 919, 944 (1983). Furthermore, the doctrine “force[s] the Court to confront serious constitutional questions that it could otherwise avoid,” which the Court frequently prefers to do.

Defenders of Auer also suspect that critics of the doctrine seek to wage a wider war against the New Deal generally, of which the challenge to Auer is a vanguard assault. Perhaps partly due to these concerns, strategically included in the petition is footnote five, which seeks to assure the Court that Garco challenges Auer deference only. Garco makes clear they are not challenging Chevron deference (a related administrative law doctrine that features even more prominently in the federal judiciary’s administrative law docket), and that, due to the different logical underpinnings of the doctrines, the Court can reconsider the former without calling into question the latter.

While this is true, skeptics are likely right to some extent: once the Court overtly wades back into the thicket of its administrative law deference case law, it is likely both deference doctrines will be revisited–especially since some of the same justices skeptical of Auer are skeptical of Chevron. This might cause some reticence among the less vociferous Auer skeptics (such as the Chief), who have not evinced any clear interest in reconsidering Chevron to date. In this light, Garco’s footnote five is designed to comfort justices who might be on the fence about cert in this case due to concerns over what further litigation such a grant may be inviting in the long run.

Ultimately, whether the Court grants cert in Garco or not, it cannot avoid Auer forever. The doctrine comes into play in too many cases and will inevitably find its way back to the Court in some fashion, at which time these same problems will be implicated once again. As I stated in the essay a few months back:

Auer reinvigorated Seminole Rock to the detriment of separation of powers, the intended scheme of the APA, and prudent policy. . . . Perhaps in the coming weeks and months, Justice Thomas may be proven correct in his prediction that “the doctrine is on its last gasp.” The sooner he is proven correct, the better.

Or, as the Garco Construction petition puts it, “Reconsideration of this runaway interpretive canon is overdue.” Revisiting Auer may come with some amount of baggage, but correcting jurisprudential errors always does. What the Court needs now is a clean vehicle for review. Garco Construction provides just that.

%d bloggers like this: