Notice & Comment

Adjudication Developments 2020, by Jeremy Graboyes

In advance of next month’s annual ABA Administrative Law Conference, Chris Walker, Matt Wiener, and I have been tracking developments in administrative adjudication so far this year.

Chris and Matt will present our research during the Conference’s Developments in Administrative Law program on November 20. By way of a preview, I’ll share a few of this year’s more notable trends.

Adjudication During the COVID-19 Pandemic

Easily the most significant development affecting the day-to-day operation of agency adjudication programs has been the pandemic. As I wrote back in April and ACUS continues to monitor, closing physical offices to the public and shifting to telework has forced agencies to innovate and embrace electronic processes at an unprecedented velocity.

Easily the most visible development has been the widescale acceptance of “virtual” (or “online” or “Zoom”) hearings. As Emily Bremer recently noted, ACUS has launched a new project on Virtual Hearings in Agency Adjudication. (If you’re interested in serving as a consultant, proposals are due this Friday, October 30. See more details here.)

But changes have run the entire gamut of the adjudication process, from e-filing to electronic case management to electronically delivered decisions. Matt and I will explore these fascinating developments during a panel at this year’s ABA Administrative Law Conference titled “Agency Adjudication During the COVID Pandemic and Beyond.” Also participating are Chairman Cheryl Mason of the Board of Veterans’ Appeals, Chief Administrative Patent Judge Scott Boalick, and Judge Jeffrey Wedekind from the National Labor Relations Board.

White House Interest in Adjudication

The White House has taken an interest in administrative adjudication since at least since 2018’s Executive Order 13843, which excepted ALJs from the competitive service, and last year’s EO 13892 on “transparency and fairness in civil administrative enforcement and adjudication.” (Comments on a proposed OPM rule implementing EO 13843 are due November 20.)

In January, the Office of Management and Budget requested information on “Improving and Reforming Regulatory Enforcement Adjudication.” Following a flurry of responses from a who’s-who of administrative law (see David Zaring’s summary), President Trump issued what some have called a first: an EO governing agency adjudication.

Section 6 of EO 13924 directs the head of all agencies to “consider” ten principles of “fairness” and to “revise their procedures and practices in light of them, consistent with applicable law and as they deem appropriate in the context of particular programs.” A recent memo from the Administrator of the Office of Information and Regulatory Affairs expands on the principles, offering “best practices” for agencies to consider as they implement the EO.

Structural Constitutional Questions

The Supreme Court and lower federal courts continue to explore the constitutionality of agency structures and officials, including the constitutionality of agency adjudicators.

In Seila Law v. CFPB, the Supreme Court held that the for-cause tenure protection of the Director of the Consumer Financial Protection Bureau violated the separation of powers. The Court will consider a similar challenge this Term to the structure of the Federal Housing Finance Agency, which has adjudicatory authority over certain matters. (Aaron Nielson and Chris Walker recently submitted a brief as court-appointed amicus curiae.) A similar structure exists at the Social Security Administration—a fact not lost on the Social Security bar.

The Court will also hear Arthrex v. Smith & Nephew this term, which Chris has written more about here. The Court will decide whether administrative patent judges are principal officers (as the Federal Circuit found) or inferior officers—and, if they are principal officers, whether the Federal Circuit properly remedied the Appointments Clause defect by severing APJs’ statutory tenure protections. Depending on how the Court decides, this case could have wide-ranging effects across federal administrative adjudication.

Fleming v. USDA is another case worth watching, as Dick Pierce has described here and here. That case concerns an ALJ at the Department of Agriculture whose decisions are not reviewable by a principal officer and who, like all ALJs, can only be removed for good cause as found by the Merit Systems Protection Board.  

Of course, agencies and courts continue to deal with the fallout from the Court’s 2018 decision in Lucia v. SEC. There is now a circuit split on whether litigants waive Lucia-based challenges to the constitutionality of SSA ALJs if they don’t first raise them before SSA. The Eighth and Tenth Circuits say yes, and the Third and Sixth Circuits say no. Appeals are pending in the Fourth and Eleventh Circuits.

Some litigants have tried challenging the legality of agency adjudicative schemes by filing original actions in district court while a case is pending before the agency. The courts have so far rejected these collateral challenges, requiring parties to first raise these issues in the agency adjudication and then, if they lose, to then seek review in federal court.

Agency-Head Review and Agency-Adjudicator Relations

Beyond the big constitutional questions, developments continue to shape the relationship between agency leadership, especially political appointees, and career adjudicators.

Some developments center on the role of the agency head as the ultimate decision maker in agencies’ adjudicative hierarchies. In the past year, for example, both the Secretary of Labor and the EPA Administrator asserted their authority to review decisions issued by agency appellate bodies, and the EPA Administrator reserved to himself the authority to designate precedential Environmental Appeals Board decisions. (This rule purports to be a mechanism by which the agency head can clearly indicate which decisions represent the agency’s official position and may warrant Chevron or Auer deference.) The Attorney General, of course, continues to review Board of Immigration Appeals decisions from time to time, and an August notice proposes to expand the decision-making and quality review authority of the Director of the Executive Office for Immigration Review.

Other developments center on the employer-employee relationship between agencies and adjudicators, which can often prompt discussions about adjudicators’ impartiality and decisional independence.

Back in May, the Federal Labor Relations Authority’s Federal Service Impasses Panel (FSIP) issued a decision following a breakdown in negotiations between SSA and the Association of Administrative Law Judges (AALJ). The collective bargaining agreement at issue addresses, among other things, APA protections and consequences for ALJs who fail to meet case processing guidelines or benchmarks. Following the Panel’s decision, the AALJ filed a lawsuit in the DC District Court challenging the FSIP on Appointments Clause grounds.

And in July, a Federal Labor Relations Authority Regional Director dismissed the Department of Justice’s petition to decertify the National Association of Immigration Judges. The Director rejected arguments that a new deferential standard of reviewing immigration judges’ decisions renders them policymakers and therefore management officials, and that constitutional officers under Lucia lack collective bargaining rights. That decision is appealable to the Authority.

For those interested, my colleague Leigh Anne Schriever just posted a draft report on the complicated web of statutes, rules, guidance, and other materials that regulate adjudicators in federal agencies. ACUS’s Adjudication Committee has just begun considering a recommendation on how agencies can make information about these policies and practices accessible to parties and other interested members of the public.

Delays in Adjudication

Finally, I’ll note that case processing delays and backlogs have been an ongoing theme in the nation’s highest-volume adjudication programs. This year has been no exception, especially in the face of a pandemic that has affected how federal and state agencies operate (see above) and increased filings in some areas (e.g., claims for unemployment benefits).

As in past years, we see backlog-related litigation in immigration-related programs administered by the U.S. Citizenship and Immigration Services, the Executive Office for Immigration Review, and consular officers under Presidential Proclamation 9645. But litigation crops up elsewhere, too—in the Medicare reimbursement context, for example, where wait times can average three to five years. Courts remain mostly unreceptive to unreasonable delay challenges and seem reluctant to police timeliness in adjudication.

Other Developments

There are plenty of other developments too—affecting everything from hearing procedures to agency appellate systems to inter-decisional consistency to policymaking by adjudication. Be sure to tune into Chris’s and Matt’s presentation during the ABA Administrative Law Conference’s Developments program on November 20.

Jeremy Graboyes is Deputy Research Director at the Administrative Conference of the United States. The views expressed in this essay are those of the author and do not necessarily represent the views of the Administrative Conference or the federal government.

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