Chapter 15 LEGL 2700

What are Administrative Agencies?

They are the boards, bureaus, commissions, and organizations that make up the governmental bureaucracy

What are the types of regulatory authorities?

Quasi-Legislative

Quasi-Judicial

What is Quasi-Legislative authorities?

Power given to the administrative agencies to make rules and regulations that have the force of law.

What is Quasi Judicial authorities?

Power given to administrative Agencies to resolve disputes, hold hearings, and make legal decisions

What is the purpose of Administrative Agencies?

To create and enforce laws constituting the legal environment of business

What are the Reasons for Agencies

1) Provides Specificity

2) Provides Expertise

3) Provides Protection

4) Provides Regulation

5) Provides Services

Elaborate on "Provide Specificity"

Uses big general language to create federal administrative agencies to give more power

Elaborate on "Provide Expertise"

Development of robust policies require expertise, agencies are asked to be very specific in their field

Elaborate on "Provide Protection"

Many agencies exist to protect the public from the business community/actions

Ex: EPA/SEC

Elaborate on "Provide Regulation"

Agencies replace Competition with Regulation

Elaborate on "Provide Services"

Some agencies are there to provide/setup a necessity as a service.

Ex: Postal Services

What are the 3 powers of Agencies?

Legislative, Executive, Judicial

Explain Legislative Power for Agencies

Power to create rules & regulations

Explain Executive Power for Agencies

Power to investigate, prosecute, advise, supervise

Explain Judicial Powers for Agencies

Power to decide controversies

What are some functions for Agencies? (4)

Rule Making

Adjudicating

Advising

Investigating

Explain Rule Making in Agencies

Process by which administrative agencies make rules and regulations that are backed by the law

Explain Adjudicating in Agencies. What can they issue?

1) Essentially the fact finding and applying the law to the facts

2) Can issue Cease and Desist Orders

3) Can issue Consent Orders

What is a Cease and Decist Order?

Orders a violator to stop doing an action and refrain from doing it any further.

What is a Consent Order? Does it admit Wrong Doing?

Settlement agreement in which a business or individual complies with all individual terms

It does NOT admit wrongdoing

What does a Consent Order Dodge?

Dodges bad press and court

Explain Advising in Agencies

Are they legally binding?

Agencies provide reports to the government to report information to the public

1) The reports are NOT legally binding

What is an Advisory Opinion

Statement that provides guidance/clarity and helps businesses avoid violations

Gives companies security, but it is NOT binding

Unique device that is not usually available in judicial system

What is Investigating in Agencies?

Agencies may investigate any illegal actions

It gives them subpoena powers

Power to Investigate goes hand and hand with power to adjudicate

How many members are in the organization of Agencies?

5-7

How many members are appointed as Chair Person?

1

Whose confirmation is needed for appointments?

Senates confirmation is required

Are appointees allowed to engage in other employment during the terms?

They are NOT permitted to engage in other employment

How is allowed to remove members? What is REQUIRED to do so?

Only the PRESIDENT can remove them, and it must be FOR CAUSE

What happened in Free Enterprise Fund v. Public Company Accounting Oversight Board 561 U.S. 477, 13- S.Ct. 3138 (2010)?

Congress Created the Sarbanes-Oxley Act (SOX) which reated the Public Company Accounting Oversight Board (PCAOB).

Removal of PCAOB members could only be done by SEC members if it was FOR CAUSE.

Court ruled that this was constitutional since it limited the president's ability to remove members. This was due to the 2 layers of protection.

Who keeps the Federal Register?

Secretary keeps the federal register

How often is the Federal Register Published? What does it publish?

It is published daily.

It publishes:

- All finalized rules of agencies

- All proposed rules of an agency

- All opinions about the rules of the agencies

Do ALL federal agencies report to the federal register?

Yes, ALL federal agencies report to federal register

Does PTO report their trademarks to the Federal Register?

PTO does report to the federal register,

BUT they have their own register when it comes to trademarks.

What does ALJ Stand for?

Administrative Law Judge

What are Administrative Law Judges (ALJ)?

They have immunity like a regular judge

Protection from liability from decisions

Very Powerful

What happened in Free Lucia v. SEC, 585 U.S. ___, 138 S.Ct. 2044 (2018)?

Lucia was sanctioned by a SEC ALJ.

He sued stating that the ALJ who heard the case was appointed unconstitutionally.

SEC claimed that ALJs were simply "employees"

Court ruled that ALJ's are officers and therefore must be appointed under the Appointments Clause of the Constitution.

What happened in Securities and Exchange Commission v. Jarkesy (June 27, 2024)?

Big Implications on in-house administrative proceedings moving forward?

Basically the supreme court ruled that civil penalties for securities fraud MUST GO THROUGH the federal courts under the 7th amendment.

This made it so in-house administrative proceedings can't be used anymore. It also reduces the powers of the ALJs

How are agencies influenced?

1) Agencies give public notice of proposed rules and hold public hearing

2) Interested parties present evidence in support or opposition to the regulation

3) Agencies react to the fore of public opinion

4) Each branch of government has control over the administrative Process

What is the Process of Judicial Review of Agency Decisions

1) Is there Standing to sue?

2) Review the Rule Making

3) Review Factual Determinations

4) Is there exhaustion of Remedies?

What does Standing to Sue Mean?

Does the suing party meet the requirements to actually bring a lawsuit into court?

When reviewing rule making, when is delegation valid? Explain the two Constitutional Limitations.

There are 2 constitutional limitations:

Definite and Limited.

Definite: If the rule making is NOT definite, it violates due process

Limited: It has to provide that the agency power to act is limited to area's that are certain

What does it mean if Authority is Exceeded?

Authority is exceeded if an agency goes way outside or beyond the intent of congress

What happened in Food and Drug Administration v. Brown & Williamson Tobacco Corporation 120 S.Ct. 1291 (2000)?

FDA claimed that they could regular tobacco under the FDC Act.

Brown stated that the FDC Act never intended for the FD to regulate tobacco.

Court ruled in FAVOR of Brown stating that Congress had not given the FDA authority to regulate tobacco. This is seen by them adding in past laws that required warning labels (implying tobacco was legal)

What does Review of Factual Determinations Mean?

When the court reviews the facts found by a lower court or administrative agency to ensure the facts were:

1) Supported by evidence

2) Found fairly and reasonably

What does Exhaustion of Remedies mean?

Before you can take the case to court, the company MUST:

USE ALL the available procedures within the agency or system that originally handled the issue.

What happened in Loper Bright Enterprises Et Al V. Raimondo, Secretary Of Commerce, Et Al.

CONSOLIDATED WITH

Relentless, Inc. V. Department of Commerece (June 28, 2024)?

Fishing companies were told they had to pay for government monitors on their boats, with the reasoning of the Chevron Deference

They argued that the law never told them that THEY should pay for it.

Supreme Court OVERTURNED the Chevron Precedent. Stating that Agencies do not have the right to possess special competence in resolving statutes.

Was Chevron V. Natural Resources Defense Council Overruled?

YES IT WAS OVERRULED

What case overturned Chevron??

LOPER BRIGHT Vs. Raimondo, Secretary of Commerce

What are some Criticisms of Administrative Agencies?

Relating to Personnel

Relating to Procedures

Relating to Substance

Elaborate on Criticisms Relating to Personnel (There are 3)

1) Difficulty in hiring/retaining the best qualified people

2) Difficult to discharge shit employees

3) Top positions were selected for political reasons

Elaborate on Criticisms Relating to Procedures (There are 4)

1) Delays in decision-making processes

2) Administrative process is overwhelmed with paperwork/meetings

3) Rules/Regulations are written in complex legal language

4) Dictatorial in nature

Elaborate on Criticisms relating to Substance (There are 3)

1) Rules and Regulations Overlap and Conflict

2) Actions for illegal conduct end only with consent orders

3) Enforcement of laws varies over time