I have a dark confession: I probably won’t teach exhaustion to my administrative law students. My syllabus covers ripeness/standing, the “final agency action” requirement, mootness, and, yes, exhaustion. But to my shame, I include this disclaimer: “May be cut if insufficient time.” Sure, I try to justify this decision to myself. I think: “Well, with just three credits, it is hard to teach everything. Realistically, what can I cut? Formal rulemaking? Come on. And if students are interested in these sorts of questions, they really should take Federal Courts anyway, which, ehh, you know, kind of touches on some of these topics.” Lawyers are good at self-justification. But my heart is uneasy. Can someone really take administrative law without learning exhaustion? It’s certainly not covered in “Leg Reg.” Thankfully, this week the D.C. Circuit offered an excellent tutorial.
The case is Jarkesy v. SEC, written by Judge Srinivasan (and joined in full by Judges Kavanaugh and Randolph). The issue is important: must someone charged with securities violations go through the SEC’s administrative process or can he raise constitutional challenges to those agency proceedings directly in federal district court? (As an aside, here is a great recently posted article on agency adjudication.) Some question these administrative proceedings; after all, there is no jury, and is this really a fair tribunal? In this case, the SEC’s target contended that this sort of system isn’t constitutional and sought to have a federal court cut off the administrative process at the get go. In a lengthy opinion, the D.C. Circuit said no (but acknowledged that “various district courts have reached divergent conclusions”). Instead, the panel held that before complaining to a federal court, you have to go through the SEC first. To be sure, a “wait and see” approach is costly for the defendant. But “the judicial system tolerates those harms, and they are insufficient for us to infer an exception to an otherwise exclusive scheme.” Trust me, no matter what you think of the opinion’s efforts to distinguish Free Enterprise Fund, if you care about exhaustion (or have the misfortune to learn administrative law from me), you will learn a lot from the court’s opinion in this case. (As an added bonus, there is a dose of facial versus as-applied analysis too. Who doesn’t love the intersection of Admin Law and Fed Courts?)
The D.C. Circuit issued only one other opinion this week: Sierra Club v. U.S. Army Corps of Engineers.* And sure enough, I don’t teach what this case is about either. The panel addressed whether the National Environmental Policy Act (NEPA) requires an agency authorizing the construction of an oil pipeline, less than 5% of which crosses through federal land, to consider the environmental impacts of the entire 600-mile pipeline. Short answer: No. But the court’s reasons were not short. Instead, Judge Pillard’s opinion (joined by Judge Wilkins) is 42-pages long. Judge Brown concurred in the judgment, dismissing the case as “not a close” one, and lamenting that the court’s lengthy opinion gave “the impression that Sierra Club’s challenges fail by a hairsbreadth rather than a hectare.”
So what’s the moral of the week? Maybe it’s time for administrative law to be a five-credit class.
* Although the court only issued two opinions, there is more news: the SEC petitioned for rehearing en banc in Conflict Minerals. Perhaps we are in store for more literary warfare. After all, who says you can’t repeat the past?
D.C. Circuit Review – Reviewed is designed to help you keep track of the nation’s “second most important court” in just five minutes a week.