Amicus Curiae Brief — James L. Kisor, Petitioner v. Robert Wilkie, Secretary of Veterans Affairs

No. 18-15

IN THE

Supreme Court of the United States

————

JAMES L. KISOR,

Petitioner,

V.

ROBERT L. WILKIE,

SECRETARY OF VETERANS AFFAIRS,

Respondent.

————

On Writ of Certiorari

to the United States Court of Appeals

for the Federal Circuit

————

BRIEF OF AMICI CURIAE NATIONAL

ASSOCIATION OF HOME BUILDERS, AMERICAN

FARM BUREAU FEDERATION, NATIONAL

ASSOCIATION OF MANUFACTURERS, NATIONAL

CATTLEMEN’S BEEF ASSOCIATION,

NATIONAL MINING ASSOCIATION, NATIONAL

FEDERATION OF INDEPENDENT BUSINESS,

AND AMERICAN FUEL & PETROCHEMICAL

MANUFACTURERS, SUPPORTING PETITIONER

————

MEGAN BERGE

EVAN A. YOUNG

Counsel of Record

JARED WIGGINTON

ADAM DEC

BAKER BOTTS L.L.P.

WILLIAM SEIDLECK

98 San Jacinto Blvd., Ste 1500

BAKER BOTTS L.L.P.

Austin, Texas 78701-4078

1299 Pennsylvania Ave., NW

(512) 322-2500

Washington, D.C. 20004-2400 evan.young@bakerbotts.com

(202) 639-7700

Counsel for Amici Curiae

(additional counsel listed on inside cover)

AMY CHAI

THOMAS J. WARD

NATIONAL ASSOCIATION

OF HOME BUILDERS

1201 15th St. NW

Washington, D.C. 20005

(202) 266-8232

Counsel for Amicus Curiae

National Association of

Home Builders

KATIE SWEENEY

NATIONAL MINING

ASSOCIATION

101 Constitution Ave. NW,

Ste 500 E

Washington, D.C. 20001

(202) 463-2646

Counsel for Amicus Curiae

National Mining Association

KAREN R. HARNED

ELIZABETH MILITO

NATIONAL FEDERATION OF

INDEPENDENT BUSINESS

1201 F Street NW, Ste 200

Washington, D.C. 20004

Counsel for Amicus Curiae

National Federation of

Independent Business

SCOTT YAGER

NATIONAL CATTLEMEN’S

BEEF ASSOCIATION

1275 Pennsylvania Ave., NW, Ste 801

Washington, D.C. 20004

(202) 347-0228

Counsel for Amicus Curiae National

Cattlemen’s Beef Association

ELLEN STEEN

TRAVIS CUSHMAN

AMERICAN FARM BUREAU

FEDERATION

600 Maryland Ave., SW,

Ste 1000 W

Washington, D.C. 20024

(202) 406-3618

Counsel for Amicus Curiae

American Farm Bureau Federation

PETER C. TOLSDORF

MANUFACTURERS’ CENTER

FOR LEGAL ACTION

733 10 St., NW, Ste 700

Washington, D.C. 20001

(202) 637-3133

Counsel for Amicus Curiae the

National Association of Manufacturers

RICHARD MOSKOWITZ

TAYLOR HOVERMAN

AMERICAN FUEL &

PETROCHEMICAL

MANUFACTURERS

1800 M Street, NW

Suite 900 North

Washington, D.C. 20036

(202) 457-0480

Counsel for Amicus Curiae American

Fuel & Petrochemical Manufacturers

TABLE OF CONTENTS

Page

Interest of Amici Curiae and Introduction........................ 1

Summary of Argument ..................................................... 5

Argument ........................................................................... 6

I.

Past Judicial Decisions Show How Auer

Unfairly And Significantly Harms

Businesses And Individuals .............................. 7

A. Auer promotes judicial abdication

that can have crippling economic

consequences ............................................. 7

B. Auer nudges courts to acquiesce in

agency

actions

that

disrupt

legitimate reliance interests................... 12

C. By

saving

flawed

agency

interpretations, Auer fosters the

writing of unclear rules........................... 16

D. Auer is inconsistent with the APA ........ 21

II. Auer’s Hidden Harms Are No Less Real

Or Significant .................................................... 23

III. Overruling Auer Will Not Overburden

The Courts......................................................... 26

Conclusion ........................................................................ 29

TABLE OF AUTHORITIES

Page(s)

CASES

Belle Co. v. U.S. Army Corps of Eng’rs,

761 F.3d 383 (5th Cir. 2014) ......................................... 22

Cape Hatteras Access Pres. All. v. U.S.

Dep’t of Interior,

344 F. Supp. 2d 108 (D.D.C. 2004) .............................. 10

Christopher v. SmithKline Beecham Corp.,

567 U.S. 142 (2012) ............................................ 12, 14, 15

City of Arlington v. FCC,

569 U.S. 290 (2013) ..................................................28, 29

Clark v. U.S. Dep’t. of Agric.,

537 F.3d 934 (8th Cir. 2008) ......................................... 14

Decker v. Nw. Envtl. Def. Ctr.,

568 U.S. 597 (2013) ............................................... passim

Eisai, Inc. v. FDA,

134 F. Supp. 3d 384 (D.D.C. 2015) ................................ 9

Foster v. Vilsack,

820 F.3d 330 (8th Cir. 2016) ......................................... 15

Foster v. Vilsack,

No. CIV. 13-4060-KES, 2014 WL

5512905 (D.S.D. Oct. 31, 2014) ...............................14, 15

Garco Constr., Inc. v. Speer,

138 S. Ct. 1052 (2018) ................................................... 19

Gutierrez-Brizuela v. Lynch,

834 F.3d 1142 (10th Cir. 2016) ....................................7, 8

Home Builders Ass’n of N. Cal. v. U.S.

Fish & Wildlife Serv.,

616 F.3d 983 (9th Cir. 2010) ......................................... 10

Marbury v. Madison,

5 U.S. (1 Cranch) 137 (1803) .......................................... 8

Marsh v. J. Alexander’s LLC,

905 F.3d 610 (9th Cir. 2018) ......................................... 21

Mittelstadt v. Perdue,

No. 17-2447, 2019 WL 191045 (7th Cir.

Jan. 15, 2019) ............................................................11, 12

Moore v. Hannon Food Serv., Inc.,

317 F.3d 489 (5th Cir. 2003) ......................................... 13

New Hope Power Co. v. U.S. Army Corps

of Eng’rs,

746 F. Supp. 2d 1272 (S.D. Fla. 2010) ......................... 22

N.M. Cattle Growers Ass’n v. U.S. Fish &

Wildlife Serv.,

248 F.3d 1277 (10th Cir. 2001) ..................................... 11

Paragon Health Network, Inc. v.

Thompson,

251 F.3d 1141 (7th Cir. 2001) ....................................... 12

Perez v. Mortg. Bankers Ass’n,

135 S. Ct. 1199 (2015) ..............................................21, 28

Rapanos v. United States,

547 U.S. 715 (2006) ..................................................17, 25

Rivera v. Peri & Sons Farms, Inc.,

735 F.3d 892 (9th Cir. 2013) ....................................15, 16

Rivera v. Peri & Sons Farms, Inc.,

No. 311:11-cv-008118-RCJ-VPC (D.

Nev. Dec. 15, 2015), ECF 182 ..................................... 16

Rodriguez de Quijas v.

Shearson/American Express, Inc.,

490 U.S. 477 (1989) ....................................................... 23

Sec’y of Labor v. Beverly Healthcare-HillView,

541 F.3d 193 (3d Cir. 2008) .....................................13, 14

Summit Petroleum Corp. v. EPA,

690 F.3d 733, 737, 741 (6th Cir. 2012) ....................20, 21

Talk Am., Inc. v. Mich. Bell Tel. Co.,

564 U.S. 50 (2011) ................................................. passim

Thomas Jefferson Univ. v. Shalala,

512 U.S. 504 (1994) ....................................................... 17

United States v. Deaton,

332 F.3d 698 (4th Cir. 2003) ....................................17, 18

W. Mass. Elec. Co. v. FERC,

165 F.3d 922 (D.C. Cir. 1999) ........................................ 9

Whetsel v. Network Prop. Servs., LLC,

246 F.3d 897 (7th Cir. 2001) ....................................12, 13

STATUTES

5 U.S.C. § 702 ...................................................................... 24

33 U.S.C. § 1344(f)(1)(A) .................................................... 24

REGULATORY AUTHORITIES

7 C.F.R. § 12.31(b)(2)(ii)..................................................... 14

29 C.F.R. § 541.118(a)(6)...............................................12, 13

33 C.F.R. § 323.4(a)(1)(ii) ................................................... 24

33 C.F.R. § 328.3(b)(2) ....................................................... 22

40 C.F.R. § 122.34(b)(5) ..................................................... 25

58 Fed. Reg. 45,008, 45,033-45,034 (Aug. 25,

1993) ............................................................................... 22

General Permits for Stormwater Discharges From Small Municipal Separate

Storm Sewer Systems in Massachusetts, Apr. 4 2016 .......................................................... 26

General Permits for Stormwater

Discharges From Small Municipal

Separate Storm Sewer Systems in New

Hampshire, Jan. 18, 2017 ............................................. 26

U.S. Army Corps of Engineers, Kohley

Farm Jurisdictional Determination ........................... 19

U.S. Army Corps of Engineers, Van Noble

Farms Determination .................................................. 18

U.S. Dep’t of Labor, Field Assistance

Bulletin 2009-2, Travel and Visa

Expenses of H-2B Workers Under the

FLSA (2009) .................................................................. 15

OTHER AUTHORITIES

Brett M. Kavanaugh, Fixing Statutory

Interpretation,

129 Harv. L. Rev. 2118 (2016) ............................ 8, 19, 28

Randy J. Kozel, Settled Versus Right: A

Theory of Precedent (2017) .......................................... 27

Randy J. Kozel, Statutory Interpretation,

Administrative Deference, and the Law

of Stare Decisis,

97 Tex. L. Rev. (forthcoming 2019) ............................ 27

The Federalist No. 47 (James Madison) ............................ 8

John Manning, Constitutional Structure

and Judicial Deference to Agency

Interpretations of Agency Rules,

96 Colum. L. Rev. 612 (1996) ....................................... 19

Cass R. Sunstein, Constitutionalism After

the New Deal,

101 Harv. L. Rev. 421 (1987) ......................................... 8

Christopher J. Walker, Legislating in the

Shadows,

165 U. Pa. L. Rev. 1377 (2017) ...............................19, 20

Daniel E. Walters, The Self-Delegation

False Alarm: Analyzing Auer

Deference’s Effects on Agency Rules,

119 Colum. L. Rev. 85 (2019) ....................................... 19

IN THE

Supreme Court of the United States

————

NO. 18-15

————

JAMES L. KISOR,

Petitioner,

v.

ROBERT L. WILKIE,

SECRETARY OF VETERANS AFFAIRS,

Respondent.

————

On Writ of Certiorari

to the United States Court of Appeals

for the Federal Circuit

————

BRIEF OF AMICI CURIAE NATIONAL

ASSOCIATION OF HOME BUILDERS, AMERICAN

FARM BUREAU FEDERATION, NATIONAL

ASSOCIATION OF MANUFACTURERS, NATIONAL

CATTLEMEN’S BEEF ASSOCIATION,

NATIONAL MINING ASSOCIATION, NATIONAL

FEDERATION OF INDEPENDENT BUSINESS,

AND AMERICAN FUEL & PETROCHEMICAL

MANUFACTURERS, SUPPORTING PETITIONER

————

INTEREST OF AMICI CURIAE AND INTRODUCTION

Amici Curiae are a group of unrelated business associations whose members are regularly affected by the

doctrine of Auer deference.1 They are listed below.

Pursuant to this Court’s Rule 37.6, amici affirm that no counsel for

a party authored this brief in whole or in part or made a monetary

contribution intended to fund the preparation or submission of this

brief, and that no person or persons other than amici and their

counsel made such a monetary contribution. Petitioner’s letter of

consent to this brief and respondent’s letter of blanket consent are

both on file with Clerk.

1

2

Each amicus dedicates its resources to facilitating the

work and livelihoods of its members—both individuals

and companies—and enhancing those members’ abilities

to serve the public throughout the United States. Federal agencies—often more than one—pervasively regulate

amici’s members, who repeatedly have experienced the

consequences of those agencies’ resort to the Auer doctrine. Auer occasionally allows welcome regulatory flexibility. But in the main, when agencies reinterpret their

own regulations in a manner that fundamentally changes

settled understandings, it denies the regulated public,

like amici’s members, the certainty and predictability

that they need to order their affairs.

Amici therefore have a substantial interest in this

case and respectfully urge the Court to overrule or significantly narrow Auer. Doing so will better ensure that

agencies regulate only in a clear, fair, and lawful manner

consistent with the basic promises of the rule of law—and

that courts do not defer to agencies when deference is not

due. Amici include the following organizations.

1. The National Association of Home Builders

(NAHB) is a Washington, D.C.-based trade association

whose mission is to enhance the climate for housing and

the building industry. Chief among NAHB’s goals are

providing and expanding opportunities for all people to

have safe, decent, and affordable housing. Founded in

1942, NAHB is a federation of more than 700 state and

local associations. About one-third of NAHB’s approximately 140,000 members are home builders or remodelers; its builder members construct about 80% of all new

homes built in the United States. The remaining members are associates working in closely related fields within the housing industry, such as mortgage finance and

building products and services. NAHB frequently participates as a party litigant and amicus curiae to safeguard

3

the constitutional and statutory rights and economic interests of its members and those similarly situated.

2. The American Farm Bureau Federation

(AFBF), headquartered in Washington, D.C., was

formed in 1919 and is the largest nonprofit general farm

organization in the United States. Representing about

six million member families in all fifty states and Puerto

Rico, AFBF’s members grow and raise every type of agricultural crop and commodity produced in the United

States. Its mission is to protect, promote, and represent

the business, economic, social, and educational interests

of American farmers and ranchers. To that end, the

AFBF regularly participates in litigation, including as

amicus curiae in this and other courts, to represent its

members.

3. The National Association of Manufacturers

(NAM), based in Washington, D.C., is the largest manufacturing association in the United States, representing

small and large manufacturers in every industrial sector

and in all fifty states. Manufacturing employs more than

twelve million men and women, contributes $2.25 trillion

to the U.S. economy annually, has the largest economic

impact of any major sector, and accounts for more than

three-quarters of all private-sector research and development in the nation. The NAM is the voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States.

4. The National Cattlemen’s Beef Association

(NCBA), based in Centennial, Colorado, is the largest

and oldest national trade association representing American cattle producers. Through state affiliates, NCBA

represents more than 175,000 of America’s farmers and

ranchers, who provide a significant portion of the nation’s

food supply. NCBA works to advance the economic, po-

4

litical, and social interests of the U.S. cattle business and

to advocate for the cattle industry’s policy positions and

economic interests.

5. The National Mining Association (NMA), based

in Washington, D.C., is a national trade association whose

members include the producers of most of America’s

coal, metals, and industrial and agricultural minerals; the

manufacturers of mining and mineral-processing machinery, equipment, and supplies; and engineering and

consulting firms, financial institutions, and other firms

serving the mining industry. NMA often participates in

litigation raising issues of concern to the mining community.

6. The National Federation of Independent Business (NFIB), based in Nashville, Tennessee, is the nation’s leading small business association, representing

members in Washington, D.C. and all 50 state capitals.

Founded in 1943 as a nonprofit, nonpartisan organization, NFIB’s mission is to promote and protect the rights

of its members to own, operate, and grow their businesses. To protect its members’ interests, NFIB frequently

files amicus curiae briefs in cases that threaten to harm

small businesses.

7. The American Fuel & Petrochemical Manufacturers (AFPM) is a national trade association whose

members comprise virtually all United States refining

and petrochemical manufacturing capacity. AFPM’s

members supply customers with a wide variety of products that Americans use daily in their homes and businesses. AFPM members help meet the nation’s fuel and

petrochemical needs, strengthen economic and national

security, and support nearly three million American jobs.

AFPM regularly engages in legal advocacy on issues that

affect its members.

* * *

5

Amici echo petitioner’s arguments that the Court

should definitively resolve the lingering doubt about Auer ’s continuing viability by either abandoning or significantly narrowing the doctrine. As concrete examples of

Auer ’s seen and unseen harms illustrate, Auer is an unnecessarily harmful impediment to businesses and individuals who must rely on the language agencies choose in

their rules, trusting that the rule really does mean what

it says. Reining in Auer would ensure clearer rulemakings and create a fairer regulatory environment, to

the great benefit of amici and their vast memberships.

SUMMARY OF ARGUMENT

The problems with the Auer doctrine transcend the

constitutional and other legal deficiencies with which the

Court is familiar, and which alone would justify overruling the case. Amici focus on the concrete, real-world

consequences that are largely hidden from view. The

way that Auer affects Americans in practice should remove any doubt that the Court should repudiate Auer.

When an agency invokes Auer—by name or just by

deed—it claims the power to interpret the words of its

own vague or ambiguous regulations, regardless of prior

positions or the public’s prior understanding and reliance. Casual reliance on Auer in the courts has a massive

effect on the law, often determining enormous stakes for

individuals and organizations in a variety of contexts.

Auer’s reach spans criminal liability, costly compliance

programs, civil rights, a lawful immigrant’s right to remain in the United States, or, in this case, a Vietnam veteran’s receipt of benefits—and countless other areas of

the law.

Auer ’s broad sway is most stifling during routine interactions between the regulated community and federal

agencies. Someone facing an agency’s questionable interpretation of a regulation that the agency deems “am-

6

biguous” knows (or soon will learn) that Auer is always

lurking. Given the degree of deference courts afford under Auer, such a person often sees little choice but to capitulate. Thus, Auer ’s greatest force lies not in judicial

decisions, but in the instances where a person does not

even turn to the courts for relief.

Whether seen or hidden, the injuries Auer inflicts on

individuals and businesses are real and significant. The

Court should abandon this doctrine, which would encourage agencies to be clearer in drafting regulations and allow courts to play their proper role in interpreting the

regulatory burdens imposed on the public.

ARGUMENT

Only the foolish would choose to build their house upon the sand.2 Auer, however, strips that choice away

from individuals and businesses by replacing the bedrock

of legitimate judicial scrutiny with the mire of presumptive deference. With little or no notice, Auer allows

agencies to drastically transform the regulatory foundation on which individuals and businesses have built their

lives and livelihoods, and to do so with impunity.3

Under the Auer doctrine, the Court defers to an agency’s interpretation of its own regulations, unless that interpretation is plainly erroneous or flatly inconsistent

with a regulation’s text. Decker v. Nw. Envtl. Def. Ctr.,

568 U.S. 597, 613 (2013). An agency’s interpretation of its

ambiguous regulation is thus all but predestined to prevail, even when it is not obvious, practical, or otherwise

legally sound, and even when it contradicts previous judicial decisions and agency guidance. The regulated community, therefore, lacks safe ground from the costly inSee Matthew 7:24-27.

Unless otherwise indicated, amici use “Auer” to refer to the current state of interpretive deference.

2

3

7

stability that Auer engenders. The examples described

below, in many of which amici here participated, document the inequitable and unsustainable conditions that

Auer fosters. The Court can rectify this problem by

overruling or significantly narrowing Auer.

I. PAST JUDICIAL DECISIONS SHOW HOW AUER

UNFAIRLY AND SIGNIFICANTLY HARMS BUSINESSES

AND INDIVIDUALS

Businesses cannot avoid uncertainty flowing from

market forces, third-party actions, and other variables.

But Auer adds an additional, unjustifiable, and especially

problematic form of uncertainty. Because it allows federal agencies to alter prior regulatory interpretations

without public notice or comment (and also to retroactively enforce the resulting novel positions), Auer can destabilize sound business decisions, creating risk that even

hiring “an army of perfumed lawyers” cannot eliminate.

Gutierrez-Brizuela v. Lynch, 834 F.3d 1142, 1152 (10th

Cir. 2016) (Gorsuch, J., concurring). As aptly stated by

the late Justice Scalia, the very author of Auer who came

to see its flaws: “Enough is enough.” Decker, 568 U.S. at

616 (Scalia, J., concurring in part and dissenting in part).

A. Auer promotes judicial abdication that can

have crippling economic consequences

The Auer doctrine unjustifiably bestows the power to

both make and interpret the law on a single entity—the

same agency that then enforces that law, thus concentrating all three branches’ powers in a single point. As Justice Scalia put it, “when an agency promulgates an imprecise rule, it leaves to itself the implementation of that

rule, and thus the initial determination of the rule’s

meaning * * * . It seems contrary to fundamental principles of separation of powers to permit the person who

promulgates a law to interpret it as well.” Talk Am., Inc.

v. Mich. Bell Tel. Co., 564 U.S. 50, 68 (2011) (Scalia, J.,

8

concurring) (internal citations omitted).4 This bestowal

of power invades what has for over two centuries been

“emphatically the province and duty of the judicial department[:] to say what the law is.” Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177 (1803).

By merging these powers, Auer can result in outcomes

that impose serious economic harms on regulated entities, if not at an agency’s whim, at least without an agency’s careful or transparent analysis. After all, the supposed careful analysis—often after notice and comment—presumably is what generated the ambiguous

regulation that requires further clarification. But the

premise of ambiguity is itself often questionable. As in

the Chevron context, with Auer a judge’s “simple threshold determination of clarity versus ambiguity may affect

billions of dollars, the individual rights of millions of citizens, and the fate of clean air rules, securities regulations, labor laws, or the like.” See Brett M. Kavanaugh,

Fixing Statutory Interpretation, 129 Harv. L. Rev. 2118,

2153 (2016). Auer deference, in other words, often flows

not from natural or even reasonable interpretations, but

instead from the judiciary first finding some iota of ambiguity and then yielding to any somewhat-plausible interpretation by the rules’ own drafters.

The extreme deference afforded by the courts under

Auer is all too often cost-prohibitive for the individuals

and businesses who would challenge an agency’s questionable interpretation. Many cases illustrate this point,

See also, e.g., Gutierrez-Brizuela, 834 F.3d at 1155 (Gorsuch, J.)

(quoting Federalist No. 47: “The accumulation of all powers, legislative, executive, and judiciary, in the same hands * * * may justly be

pronounced the very definition of tyranny.”); Cass R. Sunstein, Constitutionalism After the New Deal, 101 Harv. L. Rev. 421, 467 (1987)

(“[F]oxes should not guard henhouses * * * . Those limited by a

provision should not determine the nature of the limitation.”).

4

9

including Eisai, Inc. v. FDA, 134 F. Supp. 3d 384 (D.D.C.

2015). The loss of potentially hundreds of millions of dollars that would come from exclusive rights over a pharmaceutical turned on the court’s conclusion that strong

arguments were “insufficient to compel the Court to cast

aside the high level of deference that Auer” requires,

which it felt “bound to follow * * * until the Supreme

Court modifies the relevant standard.” Id. at 394 n.2,

395. Because the court detected a modicum of regulatory

ambiguity, id. at 394, it understood Auer to require disregarding arguments that the court itself credited as

“substantial,” “not without merit,” and otherwise probative, id. at 395-397.

Incredibly, courts have even invoked Auer without

identifying the ambiguous regulatory terms. For example, in Western Massachusetts Electric Company v.

FERC, 165 F.3d 922 (D.C. Cir. 1999), the court allowed

FERC to splice missing words into a regulation without

first identifying ambiguity, frustrating a series of multimillion-dollar interconnection agreements. Sophisticated

industry members (who had retained counsel) interpreted federal rules to require the agreements be submitted

to state authorities, rather than FERC. Id. at 926. But

FERC “believed” otherwise, asserted jurisdiction, and

demanded that costs for the project be allocated differently than negotiated. Ibid. Relying on Auer, the court

surrendered its interpretive role to FERC.

As Eisai and Western Massachusetts illustrate, Auer

can lead courts to suspend meaningful scrutiny of agency

action even when regulated individuals and businesses

have the better arguments and will suffer great losses

because of the new agency “interpretation” of its own

regulation. Auer can also lead to a more extreme form of

judicial abdication, where deference to an agency’s inter-

10

pretation of its regulation is essentially a foregone conclusion.

For example, in Cape Hatteras, a district court applied

Auer and upheld the U.S. Fish and Wildlife Service’s designation of 126 linear miles of shoreline in North Carolina

as critical habitat for wintering piping plovers over challenges filed by two North Carolina counties. Cape Hatteras Access Pres. All. v. U.S. Dep’t of Interior, 344 F.

Supp. 2d 108, 115-116 (D.D.C. 2004).5 The coastal counties, which depended on the combined annual revenue of

$386 million from tourism, sued the Service to preclude

the possibility of beach closures, expensive and timeconsuming consultation under the Endangered Species

Act, and adverse impacts on land use and recreational

and commercial uses of the designated areas. Id. at 116.

Plaintiffs contended that the Service’s adoption of

mean lower water lines and vegetation lines as boundaries violated the agency’s regulations prohibiting the use

of “[e]phemeral reference points” (e.g., trees and sand

bars) to define critical habitat for the plovers. Id. at 125126. The Service argued that the lines were not ephemeral because “though they may shift over time, they will

always exist.” Id. at 126. Deeming “ephemeral” to be

ambiguous, the district court invoked Auer and ruled in

favor of the agency within the span of a single paragraph.6

High-stakes cases like these are not uncommon. As

Chief Justice Roberts explained, “[q]uestions of SemiPiping plovers spend 10 months each year on migratory routes and

wintering grounds. Cape Hatteras, 344 F. Supp. 2d at 115.

6

See also Home Builders Ass’n of N. Cal. v. U.S. Fish & Wildlife

Serv., 616 F.3d 983, 991 (9th Cir. 2010) (deferring to the Service’s

interpretation of “specific area” under Auer to allow a designation of

a half-million acres as critical habitat for vernal pool crustaceans).

5

11

nole Rock and Auer deference arise as a matter of course

on a regular basis.” Decker, 568 U.S. at 616 (Roberts,

C.J., concurring). This includes, of course, not just

blockbuster cases, but also “smaller” ones that affect individual livelihoods. For instance, the real-world implications of agency interpretations involving critical-habitat

designations can be severe for cattlemen, who are forced

to fence off rivers—at great personal expense and inconvenience—to prevent livestock from wading into critical

habitats. See N.M. Cattle Growers Ass’n v. U.S. Fish &

Wildlife Serv., 248 F.3d 1277, 1284 n.3 (10th Cir. 2001)

(“Due to the fencing, [a rancher] has been forced to reduce the size of his herd * * * [and] the fencing limits his

access to river water which causes his significant inconvenience and financial harm.” (internal quotation marks

and citation omitted)). Similarly, home builders working

in critical habitats are often required to set aside large

percentages of their property to protect species—

property that could otherwise be developed into useable

home lots.

In Mittelstadt v. Perdue, a farmer acquired land in

1988 that was subject to a contract with the U.S. Department of Agriculture (USDA) under the Conservation

Reserve Program (CRP), in which the farmer agreed to

remove environmentally sensitive land from agricultural

production in return for annual rental payments. No. 172447, 2019 WL 191045, at *1 (7th Cir. Jan. 15, 2019).

Based on his farmland being designated as pine with

“mixed hardwood,” the farmer obtained a new CRP contract from 1998 to 2007. In 2007, however, the Farm

Services Agency terminated the farmer’s contract, finding that his property was ineligible based on an internal

re-interpretation of the definition of “mixed hardwoods”

(there was never a published definition of the term).

Ibid. The Seventh Circuit recently affirmed this inter-

12

pretation based on the agency’s “great discretion” to

“tighten” the definition, citing a Seventh Circuit case applying Seminole Rock deference. Id. at *6 n.31 (citing

Paragon Health Network, Inc. v. Thompson, 251 F.3d

1141, 1147 (7th Cir. 2001)).

The reluctance of judges to closely scrutinize agency

interpretations due to Auer, perhaps for fear of reversal,

has led to certainty of only one kind: a determined agency can likely get away with what it wants. Indeed, cases

rejecting claims of Auer deference are blue-moon cases

at best, signaling to the regulated public that there is not

much to be gained by trying.

B. Auer nudges courts to acquiesce in agency actions that disrupt legitimate reliance interests

Another problem is that Auer lends itself to agency

practices that undermine due-process principles by causing “unfair surprise” or otherwise “seriously undermin[ing] the principle that agencies should provide regulated parties ‘fair warning of the conduct [a regulation]

prohibits or requires.’” Christopher v. SmithKline Beecham Corp., 567 U.S. 142, 156 (2012) (citation omitted).

Perhaps one of the most detrimental examples of Auer

frustrating legitimate reliance interests occurs when a

deferring court overrules its own precedent that interpreted a straight-forward regulation. The Seventh Circuit did that in Whetsel v. Network Prop. Servs., LLC,

246 F.3d 897 (7th Cir. 2001). In Whetsel, an employee

alleged that her employer was violating the Fair Labor

Standards Act (FLSA) by maintaining a practice of impermissible pay deductions. The employer admitted to

“isolated occasions” of deductions but claimed it was not

liable because it had completed corrective measures within the “window of correction” under 29 C.F.R.

§ 541.118(a)(6). Id. at 899-900. The district court granted

13

summary judgment for the employer based on what most

businesses would regard as a safe zone: a binding Seventh Circuit decision. Id. at 900. But on appeal, the Secretary of Labor filed an amicus brief offering an interpretation of its regulation conflicting with the Seventh

Circuit’s previous interpretation. That court found little

more than a “modicum of support” for the Secretary’s

“strained” interpretation—yet quickly fell in line with

Auer and overruled its own recent opinion. Id. at 902904; but see Moore v. Hannon Food Serv., Inc., 317 F.3d

489, 496 (5th Cir. 2003) (declining to extend Auer deference to the Secretary’s interpretation “because

§ 541.118(a)(6) is unambiguous”).

Another example of Auer causing unfair surprise is

Secretary of Labor v. Beverly Healthcare-Hill-View, 541

F.3d 193 (3d Cir. 2008). In Beverly, the Occupational

Safety and Health Administration (OSHA) cited a nursing home for failing to compensate certain employees for

travel expenses and non-work time spent receiving medical treatment. An OSHA regulation required employers

to ensure medical evaluations and procedures were provided to qualifying employees “at no cost.” Id. at 195.

The nursing home appealed the citations, and the Occupational Safety and Health Review Commission (the

Commission) vacated them, determining that regardless

of whether OSHA’s interpretation of its ambiguous regulatory language “at no cost” was acceptable, the nursing

home lacked fair notice because recent compliance directives were “studiously vague” and an existing guidance

letter was “at odds” with OSHA’s opinion letter. Id. at

201. On appeal—even after the Commission found its sister agency’s action to be inadequate—the Third Circuit

reversed, citing Auer and holding that the nursing home

had fair notice from “the combination of” OSHA’s opinion

letter and an extra-circuit decision construing the word

14

“cost” under a comparable regulation. Id. at 205.

Recognizing this problem, the Court has attempted to

pare back the Auer doctrine in certain circumstances by

clarifying that it should not apply when an interpretation

“conflicts with a prior interpretation,” or is merely a

“convenient litigating position” or a “post hoc rationalization * * * to defend past agency action against attack.”

SmithKline, 567 U.S. at 155 (internal quotation marks

and citations omitted). In SmithKline, for example, this

Court refused to afford Auer deference to a U.S. Department of Labor (DOL) interpretation of its regulations that would “impose potentially massive liability

* * * for conduct that occurred well before that interpretation was announced.” Id. at 155-156.

Nevertheless, lower courts have struggled to apply the

lessons of SmithKline and have continued to read Auer

as allowing agencies to shift interpretations with little

notice; post hoc rationalizations to defend agency conduct

to the detriment of individuals and businesses of all sizes

have not diminished. For instance, the Eighth Circuit

upheld USDA’s interpretation of its regulations classifying a 0.8-acre portion of Arlen and Cindy Foster’s farmland as wetlands, which significantly threatened the Fosters’ livelihood.7 To determine the land’s status, 7 C.F.R.

§ 12.31(b)(2)(ii) required USDA to compare it with another site “in the local area,” but USDA chose a tract over 30

miles away. The Fosters argued that “local area” meant

adjacent or in close proximity, but the district court deferred to agency staff’s post hoc testimony interpreting

“local area” to mean anywhere within the 10,835 squaremile major land resource area (larger than MassachuPersons determined to have manipulated wetlands into a “converted wetland” may be ineligible to receive farm-program payments.

Clark v. U.S. Dep’t. of Agric., 537 F.3d 934, 935 (8th Cir. 2008).

7

15

setts) in which the Fosters’ farm was located. See Foster

v. Vilsack, No. CIV. 13-4060-KES, 2014 WL 5512905, at

*11 (D.S.D. Oct. 31, 2014). The Eighth Circuit affirmed

the district court’s decision. See Foster v. Vilsack, 820

F.3d 330, 332-333, 335 (8th Cir. 2016).

Just one year after SmithKline, the Ninth Circuit allowed a FLSA class-action suit to proceed against a family farm for conduct that DOL found acceptable just one

year earlier. Rivera v. Peri & Sons Farms, Inc., 735

F.3d 892 (9th Cir. 2013). For decades, employers were

not required to reimburse temporary guest workers for

travel expenses until after their work was completed. In

2009, under a new administration, the Department issued

contrary guidance that required employers to reimburse

workers hired for the H-2B Program within the first

week of work. DOL, Field Assistance Bulletin 2009-2,

Travel and Visa Expenses of H-2B Workers Under the

FLSA 1 (2009). When Peri & Sons, relying on wellestablished industry practice, failed to pay their workers

within the first week, they became the subject of a class

action.

At the Ninth Circuit, DOL filed an amicus brief arguing that Peri & Sons was liable under the agency’s new

interpretation, even for expenses incurred before issuance of the 2009 guidance. Br. for Sec’y of Labor as

Amicus Curiae in Supp. of Plaintiffs-Appellants, Rivera

v. Peri & Sons Farms, Inc., 735 F.3d 892 (9th Cir. 2013)

(No. 11-17365), EFC 13. The Department reasoned that

its new interpretation “d[id] not create retroactivity concerns” because it “simply clarifie[d] what the law has always meant * * * .” Id. at 25. Rather than applying an

impartial interpretation of the DOL regulation, the Ninth

Circuit deferred to the Department’s “clarification.” See

Rivera, 735 F.3d at 899. After this Court denied Peri &

Sons’ petition for a writ of certiorari, the company settled

16

the class action for $2.8 million. Rivera v. Peri & Sons

Farms, Inc., No. 3:11-cv-00118-RCJ-VPC (D. Nev. Dec.

15, 2015), EFC 182 ([Proposed] Order Granting Final

Approval of Class and Collective Action Settlement).

As these examples illustrate, it is unclear where the

regulated community can turn for safety with the Auer

doctrine entrenched in the judicial system. Even where

ostensibly dispositive past practices, agency guidance,

and binding judicial precedent exist, just the executive

branch’s whisper of “Auer” can make it all disintegrate.

C. By saving flawed agency interpretations, Auer

fosters the writing of unclear rules

Yet another problem with the Auer doctrine is that it

creates perverse incentives:

[D]eferring to an agency’s interpretation of

its own rule encourages the agency to enact

vague rules which give it the power, in future adjudications, to do what it pleases.

This frustrates the notice and predictability

purposes of rulemaking, and promotes arbitrary government.

Talk Am., 564 U.S. at 69 (Scalia, J., concurring). In a

prior dissent (joined by Justices Stevens, O’Connor, and

Ginsburg), Justice Thomas highlighted this problem with

respect to regulations promulgated by the Department of

Health and Human Services:

[T]he Secretary has merely replaced statutory ambiguity with regulatory ambiguity.

It is perfectly understandable, of course,

for an agency to issue vague regulations,

because to do so maximizes agency power

and allows the agency greater latitude to

make law through adjudication rather than

through the more cumbersome rulemaking

17

process. Nonetheless, agency rules should

be clear and definite so that affected parties will have adequate notice concerning

the agency’s understanding of the law.

Thomas Jefferson Univ. v. Shalala, 512 U.S. 504, 525

(1994) (5-4) (Thomas, J., dissenting). What agency

wouldn’t prefer the guarantee of flexibility tomorrow that

flows from inserting ambiguity today?

Identifying actual instances where an agency purposefully injects ambiguity into a regulation is difficult—no

sensible agency would openly admit it at the time. Yet

evidence shows that agencies have promulgated and exploited ambiguous regulations with the purpose of expanding their jurisdiction and with the practical effect of

imposing additional costs and burdens on the individuals

and businesses that they regulate. See, e.g., Talk Am.,

564 U.S. at 69 (Scalia, J., concurring) (noting that the

Federal Communications Commission “has repeatedly

been rebuked in its attempts to expand the [Telecommunications Act of 1996] beyond its text, and has repeatedly

sought new means to the same ends”). The U.S. Army

Corps of Engineers (Corps), too, has a history of adopting and interpreting ambiguous regulations to expand

Corps jurisdiction when not bound by the rigors of notice-and-comment. See Rapanos v. United States, 547

U.S. 715, 725 (2006) (plurality op.).

The Corps’ case-by-case interpretations of its intentionally ambiguous regulations harm individuals and

businesses and, when challenged, are upheld under Auer.

The Fourth Circuit, for example, relied on Auer to affirm

a district court’s remediation order requiring homeowners who violated the Clean Water Act (CWA) to fill in a

drainage ditch that they had dug on their property and to

restore it to pre-violation conditions. United States v.

Deaton, 332 F.3d 698, 701-702 (4th Cir. 2003). Why had

18

they dug the ditch? To obtain a sewage-disposal permit

for the construction of a residential subdivision, which

had previously been denied because of the “poorly

drained” condition of their property. Id. at 702. When

the homeowners deposited the excavated dirt alongside

the ditch in regulated wetlands on their property, the

government sued them for failing to obtain a permit to

discharge fill materials into “navigable waters” under

Section 404(a) of the CWA. Id. at 702, 704.

The decision centered on a broad reading of “tributary.” The Corps deemed the roadside ditch a “tributary” of the Wicomico River and claimed jurisdiction because the homeowners’ wetlands drained into the ditch

and eventually flowed into the Wicomico River and Chesapeake Bay. Id. at 708. The homeowners, on the other

hand, contended that the term “tributary” in the regulation could not fairly encompass all branches of a system,

but only those that empty “directly into a navigable waterway.” Id. at 710. Although the court acknowledged

that the regulation in question was ambiguous due to

multiple possible interpretations of “tributary,” it did not

determine what the best or most rational reading of the

regulation was. Instead, it cited Auer and held that

“tributary” “means what the Corps says it means.” Id. at

709, 711.8

As a further example of how Auer leads to capricious outcomes, in

November 2016, two Corps districts completed jurisdictional determinations related to two agricultural operations—one in New York,

another in Illinois. Both farms have isolated waterbodies and wetlands approximately one mile from the nearest traditional navigable

water. The Buffalo District found no significant nexus, and thus no

jurisdiction, whereas the Chicago District found a significant nexus.

See Van Noble Farms Jurisdictional Determination, available at

https://www.lrb.usace.army.mil/Portals/45/docs/regulatory/JDForms/

2016-11-Nov/JD-LRB-2016-01169NY.pdf?ver=2016-11-22-101257-237;

8

19

Despite concrete examples like those above, a recent

article claims that no empirical evidence supports—and

“some evidence” refutes—the “perverse incentives” critique of the Auer doctrine.9 Using a computer program

to complete a vagueness analysis of numerous economically significant rules adopted between 1982 and 2016,

this article concludes that there has not been a post-Auer

increase in the “vagueness” of regulations. Of course,

assigning parameters for vagueness is inherently problematic; “virtually any phrase can be rendered ambiguous if a judge tries hard enough.” Kavanaugh, supra, 129

Harv. L. Rev. at 2139 n.106 (quotation marks and citation

omitted). This conclusion hardly undermines the perverse-incentives critique, particularly when agencies are

incentivized to find ambiguities in the regulations they

have drafted.

Past judicial decisions and scholarly articles show that

these incentives are real, remain, and have concrete impacts.10 There is also evidence that agency drafters “agKohley Farm Jurisdictional Determination, available at https://www.

lrc.usace.army.mil/Portals/36/docs/regulatory/jd/2016/LRC-2016-833

jd.pdf.

9

Daniel Walters, The Self-Delegation False Alarm: Analyzing Auer

Deference’s Effect on Agency Rules, 119 Colum. L. Rev. 85, 142

(2019).

10

Judges and scholars have expressed serious doubt as to the wisdom and fairness of rewarding the drafting of ambiguous regulations. See, e.g., Garco Constr., Inc. v. Speer, 138 S. Ct. 1052, 1052

(2018) (Thomas, J., dissenting from denial of certiorari); Decker v.

Nw. Envtl. Def. Ctr., 568 U.S. 597, 615 (2013) (Roberts, C.J., joined

by Alito, J., concurring); John Manning, Constitutional Structure

and Judicial Deference to Agency Interpretations of Agency Rules,

96 Colum. L. Rev. 612, 617 (1996) (asserting that “doubts about Seminole Rock are well founded, and that the Court should replace Seminole Rock with a standard that imposes an independent judicial

check on the agency’s determination of regulatory meaning”).

20

gressively” interpret regulations when they know deference doctrines apply. See Christopher J. Walker, Legislating in the Shadows, 165 U. Pa. L. Rev. 1377, 1419-20

(2017) (noting, unsurprisingly, that a majority of rule

drafters responded that “a federal agency is more aggressive in its interpretive efforts if it is confident that

Chevron deference (as opposed to Skidmore deference or

de novo review) applies”). There is no reason to think

drafters would not be similarly, or more, aggressive

when Auer applies.

Ultimately, Auer’s effects cannot be assessed by assigning a numeric value to a regulation’s “vagueness” because (1) even a small ambiguity can have disastrous results for those on the wrong side of the agency’s reading,

(2) deferring to the interpretation of whoever currently

holds power means the ambiguity is never actually resolved, and (3) many hidden harms cannot be empirically

measured. Auer forces courts to condone questionable

regulatory interpretations to the benefit of agencies and

to the detriment of the regulated community. It also

threatens to inject politics into what should be an apolitical decision: what the text means. This judicial affirmation also fosters the writing of unclear regulations, regardless of the writer’s intent, because Auer constrains

courts from holding agencies accountable when they interpret poorly drafted regulations. Without that accountability, agencies lack incentive to improve their

regulations’ clarity.

The current incentive structure can actually penalize

clarity—as when a Court finds that an unambiguous regulation is, precisely because drafted without ambiguity,

not entitled to Auer deference. When that happens, an

agency is essentially punished (or would understandably

feel punished) for its better drafting at the outset. In

Summit Petroleum Corporation v. EPA, for example,

21

the court rejected an invocation of Auer to more broadly

interpret a regulation allowing aggregation of facilities as

a single source if they are “contiguous or adjacent properties.” 690 F.3d 733, 737, 741 (6th Cir. 2012). Because

the term “adjacent” was unambiguous, EPA was held to

have boxed itself in. Ibid. But had EPA used a vaguer

term, it would have been rewarded with Auer deference.

Regulated individuals and businesses depend on predictable regulatory regimes, which in turn require clearly

written rules. Auer undermines predictability by encouraging and otherwise allowing agencies to write unclear rules that can then be interpreted in myriad ways,

depending on the prevailing preference. Agencies should

not be rewarded for undermining regulatory clarity and

stability.

D. Auer is inconsistent with the APA

Finally, Auer demonstrably offers an end-run around

the Administrative Procedure Act (APA): it allows agencies to resolve ambiguity by reinterpreting regulations

instead of using the APA’s notice-and-comment requirements to alter them. See Perez v. Mortg. Bankers Ass’n,

135 S. Ct. 1199, 1212 (2015) (Scalia, J., concurring) (“By

giving [regulations] Auer deference, we do more than allow the agency to make binding regulations without notice and comment. Because the agency (not Congress)

drafts the substantive rules that are the object of those

interpretations, giving them deference allows the agency

to control the extent of its notice-and-comment-free domain.”); Marsh v. J. Alexander’s LLC, 905 F.3d 610, 637638, 642 (9th Cir. 2018) (en banc) (Ikuta, J., joined by Callahan, J., dissenting) (lamenting how the court allowed a

substantive rule to masquerade as an interpretation under Auer—creating one of “the worst dangers of improper Seminole Rock and Auer deference”). This eviscer-

22

ates the judicial role under the APA—to independently

and fairly review agency actions and interpretations.

In one case, a sugarcane grower and renewable-energy company challenged Corps guidance on Prior Converted Cropland (PCC). New Hope Power Co. v. U.S.

Army Corps of Eng’rs, 746 F. Supp. 2d 1272, 1284 (S.D.

Fla. 2010). Joint regulations of the Corps and EPA provide that PCC falls outside the agencies’ jurisdiction. 33

C.F.R. § 328.3(b)(2). The final rule adopting these regulations clearly states that land retains its PCC status regardless of use, unless abandoned. 58 Fed. Reg. 45,008,

45,033-45,034 (Aug. 25, 1993). Nevertheless, a Florida

field office of the Corps circulated guidance indicating

that shifting PCC to a non-agricultural use would immediately result in the land losing PCC status. This guidance substantially expanded the Corps’ jurisdiction without complying with the APA’s notice-and-comment process. New Hope, 746 F. Supp. 2d at 1284. New Hope

challenged the guidance, and a district court set it aside

as a substantive rule issued without following required

procedures under the APA. Ibid.

Despite an opinion from the New Hope district court,

the Corps continues to issue jurisdictional wetland determinations on PCC lands that are used for nonagricultural purposes, forcing landowners to accept those

determinations or file suit. See, e.g., Belle Co. v. U.S.

Army Corps of Eng’rs, 761 F.3d 383, 397 (5th Cir. 2014)

(distinguishing New Hope and finding the jurisdictional

determination non-reviewable), vacated 135 S. Ct. 1548.

In these circumstances, owners of PCC lands must either

accept the Corps’ jurisdictional determination or expend

significant resources to litigate the same issue in a different forum, knowing that a court could very easily invoke

Auer as decisive.

Overcoming litigation fatigue in the face of such agen-

23

cy tenacity requires no small effort. In each of the ways

discussed above, Auer only makes it easier for agencies,

if they so choose, to push beyond the scope of their authorized power.

II. AUER’S HIDDEN HARMS ARE NO LESS REAL OR

SIGNIFICANT

The reported cases discussed above illustrate how Auer unreasonably transfers judicial power to executive

agencies and can thereby disrupt legitimate reliance interests. While these memorialized examples of Auer’s

sting are plentiful and significant, they are eclipsed by

the rarely recorded instances of Auer’s hidden harms.

No matter how many times lower-court judges

acknowledge Auer ’s dubious foundation, they have no

choice but to surrender to this Court’s precedent. See,

e.g., Rodriguez de Quijas v. Shearson/American Express, Inc., 490 U.S. 477, 484 (1989) (“[T]he Court of Appeals should follow the case which directly controls, leaving to this Court the prerogative of overruling its own

decisions.”). After witnessing two decades of courts deferring under Auer, sometimes firsthand, members of the

regulated community are keenly aware of the case’s implications. Thus, even with a powerful argument that an

agency’s interpretation is clearly erroneous, Auer easily

dissuades those individuals and businesses from litigating.

This Auer-induced chilling effect has severe consequences. First, it reflects, and perpetuates, diminished

public trust that the courts will overcome their predisposition to simply defer to agencies, as opposed to holding

them accountable for their unreasonable actions. Second,

by forestalling legitimate challenges to agency action,

Auer’s chilling effect eliminates a crucial check on administrative overreach; Auer undermines the APA’s clear

intent that anyone “suffering legal wrong because of

24

agency action, or adversely affected or aggrieved by

agency action within the meaning of a relevant statute, is

entitled to judicial relief thereof.” 5 U.S.C. § 702. And,

third, this chilling effect reduces the judiciary’s opportunity to effectuate its role in maintaining the separation

of powers.

Amici’s members are constantly subject to an everchanging web of regulatory interpretations strewn

throughout the Federal Register, policy directives,

guidelines, memoranda of understanding, circulars,

handbooks, and informal statements from agency staff.

These myriad and often hard-to-find sources containing

impermanent regulatory interpretations on a variety of

matters create substantial uncertainty for amici’s members and force them to take risks that should not be required.

This problem is prevalent in many areas, including

farming and ranching. Ordinarily, a person must either

obtain a permit under CWA Section 404 to discharge

dredge or fill materials into waters of the U.S. or face the

risk of significant legal and financial consequences. The

statute, however, exempts “normal” farming and ranching activities. See 33 U.S.C. § 1344(f)(1)(A). Although

the CWA does not define the term, regulations require

“normal” activities to be part of an “established (i.e., ongoing)” operation, and not a “new use.” 33 C.F.R.

§ 323.4(a)(1)(ii).11

To this day, farmers and ranchers still have no official interpretation of what constitutes an “established (i.e., on-going)” operation

nor any clarity on how far back in time the operation must be “established.” As a result, farmers and ranchers continue to face enforcement actions and hefty civil fines if they fail to get a CWA Section

404 permit. Many do not know if they are required to do so. And if

the Corps decides to pursue an enforcement action, many farmers

11

25

Over the years, EPA and the Corps have interpreted

what qualifies as “normal” or a “new use” not by giving a

clear (even if multifaceted) definition after careful analysis and public comment, but through a series of regional

manuals, circulars, and—troublingly—ad hoc enforcement actions. The agencies have been threatening farmers and ranchers with potentially ruinous civil and criminal penalties for plowing their own lands and switching

between ranching and farming activities. To escape this

threat, farmers and ranchers are forced to apply for costly permits. Indeed, as members of this Court have recognized, with some understatement, the burden associated with obtaining these permits “is not trivial,” as the

“Corps of Engineers [] exercises the discretion of an enlightened despot” and the “average applicant for an individual permit spends 788 days and $271,596 in completing

the process.” Rapanos, 547 U.S. at 721.12

Equally problematic are EPA’s stormwater Phase II

post-construction requirements, which obligate municipalities to obtain permits for stormwater discharges. See

40 C.F.R. § 122.34(b)(5). To obtain this permit, a municipality must develop a program to control stormwater

runoff from developed sites, including “best management

practices (BMPs) appropriate for the community.” Ibid.

Although a municipality is in the best position to know

what practices would be appropriate for its community,

and ranchers are likely to seek quick settlements rather than resist

because their economic livelihood depends on a successful grazing or

growing season.

12

In Rapanos, regulators informed plaintiff that the wetlands he

backfilled were “waters of the United States” and that his action required a permit. Twelve years of criminal and civil litigation ensued—“for backfilling his own wet fields, Mr. Rapanos faced 63

months in prison and hundreds of thousands of dollars in criminal

and civil fines.” 547 U.S. at 721.

26

EPA disagrees and routinely compels municipalities to

adopt strict limitations for stormwater volume, sediment,

and phosphorous concentration, even when the municipality has not independently determined or concurred

that those limitations are appropriate for its community.13 Auer snuffs out a municipality’s hope of successfully

challenging EPA’s interpretation of the maddeningly

vague phrase “appropriate for the community.” Rather

than waste money fighting a lost cause, most municipalities will reluctantly acquiesce to EPA’s questionable demands.

These examples illustrate a common problem across

the business world: challenges to agency interpretations

are almost certainly doomed to fail. For amici’s members and similar businesses, time-is-money and profit

margins can be razor thin. So it is hardly surprising that

many entities with strong legal cases in theory simply opt

not to fight in practice. As a result, many worthy cases

that affect American businesses will never even be pursued, which further enshrines overreach as a permanent

feature of administrative law.

III. OVERRULING AUER WILL NOT OVERBURDEN

THE COURTS

Ultimately, there is no persuasive justification for

keeping Auer deference as it exists today. Decker, 568

U.S. at 617 (Scalia, J., concurring). The two principal jusSee, e.g., General Permits for Stormwater Discharges From Small

Municipal Separate Storm Sewer Systems in Massachusetts, 2.3.6,

43-47, Apr. 4 2016, https://www3.epa.gov/region1/npdes/stormwater

/ma/2016fpd/final-2016-ma-sms4-gp.pdf; General Permits for

Stormwater Discharges From Small Municipal Separate Storm

Sewer Systems in New Hampshire, 2.3.6, 46-50, Jan. 18, 2017,

https://www3.epa.gov/region1/npdes/stormwater/nh/2017-small-ms4general-permit-nh.pdf.

13

27

tifications—“special insight” and “special expertise”—are

irrelevant. Regardless of whether agencies have some

“special insight” into the intent or meaning behind regulations, “we are bound by what they say, not by the unexpressed intention of those who made them.” Id. at 618

(emphasis in original).14 Similarly, regardless of whether

agencies possess “special expertise” in administering

complex regulatory programs, interpreting policy is not

synonymous with making policy, “unless one believes

that the purpose of interpretation is to make the regulatory program work in a fashion that the current leadership of the agency deems effective.” Ibid.

Neither do stare decisis concerns justify maintaining

the Auer doctrine. As an interpretive methodology, Auer

is broad and compulsive, straying “too far in asking the

individual Justice to subordinate her authority to the

Court’s institutional past.” See Randy J. Kozel, Statutory Interpretation, Administrative Deference, and the

Law of Stare Decisis, 97 Tex. L. Rev. (forthcoming 2019)

(manuscript at 9), https://ssrn.com/abstract=3312818.

“The consequence * * * is that [an] administrative deference regime[] like * * * Auer [is] not entitled to stare decisis effect, at least as [it is] presently justified in the

Court’s jurisprudence.” Ibid.; cf. also Randy J. Kozel,

Settled Versus Right: A Theory of Precedent 155-157

(2017).

The Court’s best option is to overturn Auer and simply give effect to regulations as written. Doing so would

provide the regulated community with predictability and

the confidence to challenge unreasonable agency action,

knowing that courts would no longer be predisposed to

Even assuming the “special insight” rationale had some validity,

which it does not, the value of that insight quickly dissipates with

changing administrations and agency-employee turnover.

14

28

ruling against them at the outset of litigation. Taking

this course would also give an agency “a stable background against which to write its rules and achieve the

policy ends it thinks best.” Decker, 568 U.S. at 619 (Scalia, J., concurring).

Notably, overturning Auer would not result in a flood

of administrative law because the doctrine only applies

where an agency interprets its own ambiguous regulations. With a clear rebuke of agency ambiguity, the incentive structure for agencies would shift to drafting

clearer regulations and, to the extent that they cannot do

so, at least to less brazen re-interpretations of regulations. In this instance, agencies who wish to see their desired outcome applied must simply write regulations that

say what they mean, which they surely can do. See

Decker, 568 U.S. at 617 (Scalia, J., concurring) (stressing

that if agencies can articulate what regulations mean in

legal briefs, they can do the same in the regulations

themselves). When agencies do so, courts should expect

fewer cases, not more.

Additionally, any fear that overruling the Auer doctrine would overburden courts with novel and unfamiliar

cases lacks justification. Judges are “trained” to look for

“the best reading” of legal texts—including of complicated legal texts. Kavanaugh, supra, 129 Harv. L. Rev. at

2153-2154; see also Perez, 135 S. Ct. at 1223 (Thomas, J.,

concurring in the judgment) (“[J]udges are frequently

called upon to interpret the meaning of legal texts and

are able to do so even when those texts involve technical

language.”). Indeed, federal judges must regularly interpret everything from federal patent laws to the federal criminal code. Judges are more than capable of reviewing and interpreting federal regulations and are the

best-suited government officials to protect the regulated

community from the “hundreds of federal agencies pok-

29

ing into every nook and cranny of daily life.” City of Arlington v. FCC, 569 U.S. 290, 315 (2013) (Roberts, C.J.,

dissenting).

CONCLUSION

This Court should overturn or further narrow Auer

doctrine.

Respectfully submitted.

MEGAN BERGE

JARED WIGGINTON

ADAM DEC

WILLIAM SEIDLECK

BAKER BOTTS L.L.P.

1299 Pennsylvania Ave., NW

Washington, D.C. 20004-2400

(202) 639-7700

EVAN A. YOUNG

Counsel of Record

BAKER BOTTS L.L.P.

98 San Jacinto Blvd., Ste 1500

Austin, Texas 78701-4078

(512) 322-2500

evan.young@bakerbotts.com

Counsel for Amici Curiae

(additional counsel listed on next page)

January 2019

30

AMY CHAI

THOMAS J. WARD

NATIONAL ASSOCIATION

OF HOME BUILDERS

1201 15th St. NW

Washington, D.C. 20005

(202) 266-8232

Counsel for Amicus Curiae

National Association of

Home Builders

KATIE SWEENEY

NATIONAL MINING

ASSOCIATION

101 Constitution Ave. NW,

Ste 500 E

Washington, D.C. 20001

(202) 463-2646

Counsel for Amicus Curiae

National Mining Association

KAREN R. HARNED

ELIZABETH MILITO

NATIONAL FEDERATION OF

INDEPENDENT BUSINESS

1201 F Street NW, Ste 200

Washington, D.C. 20004

Counsel for Amicus Curiae

National Federation of

Independent Business

SCOTT YAGER

NATIONAL CATTLEMEN’S

BEEF ASSOCIATION

1275 Pennsylvania Ave., NW, Ste 801

Washington, D.C. 20004

(202) 347-0228

Counsel for Amicus Curiae National

Cattlemen’s Beef Association

ELLEN STEEN

TRAVIS CUSHMAN

AMERICAN FARM BUREAU

FEDERATION

600 Maryland Ave., SW,

Ste 1000 W

Washington, D.C. 20024

(202) 406-3618

Counsel for Amicus Curiae

American Farm Bureau Federation

PETER C. TOLSDORF

MANUFACTURERS’ CENTER

FOR LEGAL ACTION

733 10 St., NW, Ste 700

Washington, D.C. 20001

(202) 637-3133

Counsel for Amicus Curiae the

National Association of Manufacturers

RICHARD MOSKOWITZ

TAYLOR HOVERMAN

AMERICAN FUEL &

PETROCHEMICAL

MANUFACTURERS

1800 M Street, NW

Suite 900 North

Washington, D.C. 20036

(202) 457-0480

Counsel for Amicus Curiae American

Fuel & Petrochemical Manufacturers