Petition for Writ of Certiorari — Michelle Valent, Petitioner v. Andrew M. Saul, Commissioner of Social Security

No. ______

In the

Supreme Court of the United States

__________________

MICHELLE VALENT,

v.

Petitioner,

ANDREW M. SAUL,

COMMISSIONER OF SOCIAL SECURITY,

Respondent.

__________________

On Petition for Writ of Certiorari to the

United States Court of Appeals

for the Sixth Circuit

__________________

PETITION FOR WRIT OF CERTIORARI

__________________

C. BOYDEN GRAY

ADAM R.F. GUSTAFSON

Counsel of Record

JAMES R. CONDE

BOYDEN GRAY & ASSOCIATES

801 17th St NW, #350

Washington, DC 20006

(202) 955-0620

gustafson@boydengray

associates.com

Counsel for Petitioner

August 16, 2019

Becker Gallagher · Cincinnati, OH · Washington, D.C. · 800.890.5001

QUESTIONS PRESENTED

Petitioner Michelle Valent performed unpaid

volunteer work for her brother’s veterans

organization while receiving disability benefits under

Title II of the Social Security Act. The Commissioner

of Social Security punished Ms. Valent’s failure to

report this work with $126,210 in monetary

sanctions. The Commissioner acted under his

authority to sanction persons who fail to disclose

facts that they “know[] or should know” are “material

to the determination of any initial or continuing

right to” disability benefits. 42 U.S.C. § 1320a8(a)(1)(C). The Commissioner concluded that Ms.

Valent should have known that her work activity

was “material” to her continuing right to receive

disability benefits, even though the Act forbade the

Commissioner from using Ms. Valent’s “work activity

. . . as evidence that” she was “no longer disabled.”

Id. § 421(m)(1)(B).

By a divided vote, the Sixth Circuit affirmed,

deferring to the Commissioner’s interpretation of the

Act under Chevron, U.S.A., Inc. v. NRDC, 467 U.S.

837 (1984).

The questions presented are:

1. Whether

Chevron.

the

Court

should

overrule

2. Whether Chevron requires courts to defer to

an agency’s resolution of a conflict between statutory

provisions.

3. Whether the Court should summarily

reverse the decision below, because the Sixth Circuit

ii

violated SEC v. Chenery Corp., 318 U.S. 80 (1943), by

affirming an administrative order based on an

allegation that the agency decisionmaker rejected as

unsupported by the evidence and that the

Commissioner concedes was not a basis for the order.

iii

RULE 14.1(b)(iii) STATEMENT

No proceedings in state or federal court are

directly related to this case.

iv

TABLE OF CONTENTS

QUESTIONS PRESENTED ....................................... i

RULE 14.1(b)(iii) STATEMENT ............................... iii

TABLE OF AUTHORITIES .................................... viii

PETITION FOR A WRIT OF CERTIORARI ............ 1

OPINIONS BELOW ................................................... 1

JURISDICTION ......................................................... 1

STATUTORY PROVISIONS INVOLVED ................ 1

STATEMENT ............................................................. 2

I.

II.

Legal Background ............................................... 5

A.

Title II of the Social Security Act ............... 5

B.

The Ticket to Work and Work Incentives

Improvement Act of 1999 ............................ 6

C.

Administrative Sanctions Provisions ......... 8

Factual Background ........................................... 9

III. Proceedings Below ............................................ 11

A.

Administrative Proceedings ...................... 11

B.

Court Proceedings ..................................... 13

REASONS FOR GRANTING THE PETITION ...... 15

I.

The Court Should Reconsider Chevron. ........... 15

A.

Chevron Should Be Overruled. ................. 16

B.

The Court Should Limit Chevron To Curb

Reflexive Deference. .................................. 21

C.

Stare Decisis Does Not Weigh Against

Reconsidering Chevron. ............................ 23

v

D.

II.

This Case Is a Suitable Vehicle for

Reconsidering the Validity and Scope of

Chevron. ..................................................... 25

The Court Should Clarify That Apparent

Statutory Conflict Is Not a License To Defer. . 29

III. In the Alternative, the Court Should Summarily

Reverse To Correct the Sixth Circuit’s Chenery

Violation. ........................................................... 34

CONCLUSION ......................................................... 37

Appendix A Opinion and Dissenting Opinion

of the United States Court of Appeals for

the Sixth Circuit (March 20, 2019) ............ App. 1

Appendix B Service of Final Decision of the

Department of Health & Human Services

Departmental Appeals Board, Appellate

Division (March 15, 2016) ........................ App. 30

Appendix C Recommended Decision of the

Department of Health and Human

Services Departmental Appeals Board,

Appellate Division (November 30, 2015) . App. 33

Appendix D Decision of the Department of

Health

and

Human

Services

Departmental Appeals Board, Civil

Remedies Division (July 31, 2015) ........... App. 75

vi

Appendix E Remand of Administrative Law

Judge Decision of the Department of

Health

and

Human

Services

Departmental Appeals Board, Appellate

Division (November 24, 2014) ................ App. 161

Appendix F Decision of the Department of

Health

and

Human

Services

Departmental Appeals Board, Civil

Remedies Division (June 11, 2014) ........ App. 188

Appendix G Letter of the Office of the

Inspector

General,

Social

Security

Administration (June 3, 2013) ............... App. 219

Appendix H Statutes and Regulations .......... App. 226

5 U.S.C. § 553 .......................................... App. 226

5 U.S.C. § 554 .......................................... App. 227

5 U.S.C. § 556 .......................................... App. 230

5 U.S.C. § 706 .......................................... App. 233

42 U.S.C. § 421 ........................................ App. 234

42 U.S.C. § 423 ........................................ App. 237

42 U.S.C. § 426 ........................................ App. 244

42 U.S.C. § 1320a-8................................. App. 248

20 C.F.R. § 404.1505 ............................... App. 256

20 C.F.R. § 404.1510 ............................... App. 257

20 C.F.R. § 404.1571 ............................... App. 257

20 C.F.R. § 404.1572 ............................... App. 258

20 C.F.R. § 404.1573 ............................... App. 258

20 C.F.R. § 404.1574 ............................... App. 261

20 C.F.R. § 404.1574a ............................. App. 268

20 C.F.R. § 404.1588 ............................... App. 269

20 C.F.R. § 404.1589 ............................... App. 269

20 C.F.R. § 404.1590 ............................... App. 270

20 C.F.R. § 404.1594 ............................... App. 275

vii

20 C.F.R. § 498.100 .............................. App. 277

20 C.F.R. § 498.101 ................................. App. 278

20 C.F.R. § 498.102 ................................. App. 280

20 C.F.R. § 498.103 ................................. App. 281

20 C.F.R. § 498.104 ................................. App. 281

20 C.F.R. § 498.106 ................................. App. 282

20 C.F.R. § 498.109 ................................. App. 282

20 C.F.R. § 498.110 ................................. App. 284

20 C.F.R. § 498.127 ................................. App. 284

20 C.F.R. § 498.201 ................................. App. 284

20 C.F.R. § 498.202 ................................. App. 285

20 C.F.R. § 498.203 ................................. App. 286

20 C.F.R. § 498.204 ................................. App. 287

20 C.F.R. § 498.205 ................................. App. 289

20 C.F.R. § 498.206 ................................. App. 289

20 C.F.R. § 498.207 ................................. App. 290

20 C.F.R. § 498.208 ................................. App. 291

20 C.F.R. § 498.209 ................................. App. 293

20 C.F.R. § 498.215 ................................. App. 294

20 C.F.R. § 498.216 ................................. App. 295

20 C.F.R. § 498.217 ................................. App. 297

20 C.F.R. § 498.218 ................................. App. 298

20 C.F.R. § 498.220 ................................. App. 298

20 C.F.R. § 498.221 ................................. App. 299

20 C.F.R. § 498.222 ................................. App. 301

42 C.F.R. § 406.12 ................................... App. 302

viii

TABLE OF AUTHORITIES

Cases

aaiPharma Inc. v. Thompson,

296 F.3d 227 (4th Cir. 2002)..................................32

Alaska Wilderness League v. Jewell,

788 F.3d 1212 (9th Cir. 2015)................................32

Aqua Prod., Inc. v. Matal,

872 F.3d 1290 (Fed. Cir. 2017) (en banc) ........ 31, 33

Arangure v. Whitaker,

911 F.3d 333 (6th Cir. 2018)............................ 21, 33

Barnhart v. Walton,

535 U.S. 212 (2002) ..................................................5

Berman v. Neo@Ogilvy LLC,

801 F.3d 145 (2d Cir. 2015) ...................................31

Cappetta v. Commissioner of Social Security,

904 F.3d 158 (2d Cir. 2018) ..................... 8, 9, 14, 28

Cazun v. Attorney Gen. United States,

856 F.3d 249 (3d Cir. 2017) ...................................32

Chevron, U.S.A., Inc. v. NRDC,

467 U.S. 837 (1984) ........................................ passim

Christopher v. SmithKline Beecham Corp.,

567 U.S. 142 (2012) ................................................25

ix

City of Arlington v. FCC,

569 U.S. 290 (2013) ..........................................18, 21

Decatur v. Paulding,

14 Pet. 497 (1840) ..................................................17

Digital Realty Trust, Inc. v. Somers,

138 S. Ct. 767 (2018)..............................................31

Egan v. Delaware River Port Auth.,

851 F.3d 263 (3d Cir. 2017) .............................18, 24

Epic Sys. Corp. v. Lewis,

138 S. Ct. 1612 (2018)...................................... 28, 31

Gonzales v. Thomas,

547 U.S. 183 (2006) (per curiam) .................. 4, 5, 36

Gordon v. N.Y. Stock Exch. Inc.,

422 U.S. 659 (1975) ................................................31

Gutierrez-Brizuela v. Lynch,

834 F.3d 1142 (10th Cir. 2016)........ 3, 17, 18, 19, 22

Heckler v. Day,

467 U.S. 104 (1984) ..................................................5

Holmes Grp., Inc. v. Vornado Air Circulation Sys.,

Inc., 535 U.S. 826 (2002) .......................................13

INS v. Cardoza-Fonseca,

480 U.S. 421 (1987) ................................................29

INS v. Ventura,

537 U.S. 12 (2002) (per curiam) ............................37

x

King v. Burwell,

759 F.3d 358 (4th Cir. 2014)..................................32

Kisor v. Wilkie,

139 S. Ct. 2400 (2019).................... 16, 21, 22, 23, 28

Lorenzo v. Mukasey,

508 F.3d 1278 (10th Cir. 2007)..............................32

Marbury v. Madison,

1 Cranch 137 (1803) .........................................17, 29

Michigan v. EPA,

135 S. Ct. 2699 (2015)................................ 17, 34, 36

Nat’l Ass’n of Home Builders v. Defenders of

Wildlife, 551 U.S. 644 (2007) ........................... 30, 31

Nat’l Cable & Telecomms. Ass’n v. Brand X Internet

Servs., 545 U.S. 967 (2005) .................... 3, 16, 17, 25

Nat’l R.R. Passenger Corp. v. Boston & Maine Corp.,

503 U.S. 407 (1992) ................................................22

Pauley v. Bethenergy Mines, Inc.,

501 U.S. 680 (1991) ................................................22

Pereira v. Sessions,

138 S. Ct. 2105 (2018).............................. 2, 3, 15, 20

Perez v. Mortgage Bankers Ass’n,

135 S. Ct. 1199 (2015)............................................16

xi

Perez-Guzman v. Lynch,

835 F.3d 1066 (9th Cir. 2016)................................32

Rucho v. Common Cause,

139 S. Ct. 2484 (2019)............................................24

S. Dakota v. Wayfair, Inc.,

138 S. Ct. 2080 (2018)...................................... 23, 24

Scialabba v. Cuellar de Osorio,

573 U.S. 41 (2014) .......................................... passim

SEC v. Chenery Corp.,

318 U.S. 80 (1943) .................................... 4, 5, 34, 37

Skidmore v. Swift & Co.,

323 U.S. 134 (1944) ................................................26

Utility Air Regulatory Grp. v. EPA,

573 U.S. 302 (2014) ................................................34

Voices for Int’l Bus. & Educ., Inc. v. NLRB,

905 F.3d 770 (5th Cir. 2018)..................................22

Wayman v. Southard,

10 Wheat. 1 (1825) .................................................17

Yellow Transp., Inc. v. Michigan,

537 U.S. 36 (2002) ..................................................22

xii

Constitution and Statutes

Art. I, § 7 ....................................................................24

5 U.S.C. § 553(b) ........................................................16

5 U.S.C. § 554(a) ..........................................................8

5 U.S.C. § 556(d) ........................................................35

5 U.S.C. § 706 ............................................................16

28 U.S.C. § 1254(1) ......................................................1

28 U.S.C. § 1631 ........................................................13

42 U.S.C. § 421(i) .........................................................5

42 U.S.C. § 421(m) ................................. 3, 5, 13, 32, 34

42 U.S.C. § 421(m)(1)(A) .............................................7

42 U.S.C. § 421(m)(1)(B) ............................. 2, 7, 11, 13

42 U.S.C. § 421(m)(2)(A) .............................................7

42 U.S.C. § 421(m)(2)(B) ................................. 7, 13, 15

42 U.S.C. § 423(d)(1) .................................................34

42 U.S.C. § 423(d)(1)(A) ..............................................5

42 U.S.C. § 426(b)(2)(A) ..............................................6

42 U.S.C. § 1320a-8 .....................................................8

xiii

42 U.S.C. § 1320-8(a)(2) ............................................27

42 U.S.C. § 1320a-8(a)(1) ............................................8

42 U.S.C. § 1320a-8(a)(1)(C) ........................... 2, 18, 19

42 U.S.C. § 1320a-8(a)(2) ............................................8

42 U.S.C. § 1320a-8(b)(2) ............................................8

42 U.S.C. § 1320a-8(d)(1) ............................................9

Pub. L. 106-170, 113 Stat. 1860 (Dec. 17, 1999) ....6, 7

Regulations

20 C.F.R. § 404.1510 ...................................................5

20 C.F.R. § 404.1574 ...................................................5

20 C.F.R. § 404.1574(b) ...............................................6

20 C.F.R. § 404.1574(b)(3)(ii) ......................................6

20 C.F.R. § 404.1574(b)(3)(iii) ..................... 6, 8, 26, 27

20 C.F.R. § 498.102 .....................................................9

20 C.F.R. § 498.215(b)(2) .............................................9

20 C.F.R. § 498.220 .....................................................9

20 C.F.R. § 498.221(i) ..................................................9

xiv

42 C.F.R. § 406.12(d) ...................................................6

Exemption of Work Activity as a Basis for a

Continuing Disability Review, 71 Fed. Reg.

66,840 (Nov. 17, 2006). .................................. 7, 8, 26

Other Authorities

Aditya Bamzai, The Origins of Judicial

Deference to Executive Interpretation, 126

Yale L.J. 908 (2017) ...............................................19

Kent Barnett & Christopher J. Walker,

Chevron in the Circuit Courts, 116 Mich. L.

Rev. 1 (2017) ..........................................................21

Nicholas R. Bednar & Kristin E. Hickman,

Chevron’s Inevitability, 85 G. Wash. L. Rev.

1392 (2017) .............................................................19

Jack M. Beermann, Chevron at the Roberts

Court: Still Failing After All These Years, 83

Fordham L. Rev. 731 (2014) ..................................19

The Federalist No. 51 (James Madison) ...................24

Abbe R. Gluck & Lisa Schultz Bressman,

Statutory Interpretation from the Inside-An

Empirical Study of Congressional Drafting,

Delegation, and the Canons: Part I, 65 Stan.

L. Rev. 901 (2013) ..................................................18

xv

Kaiser Family Foundation, Total Disabled

Social

Security

Disability

Insurance

Beneficiaries,

Ages

18–64

(2017),

https://bit.ly/2MkuSeD ..........................................29

Brett M. Kavanaugh, Fixing Statutory

Interpretation, 129 Harv. L. Rev. 2118

(2016) ......................................................................20

Orin S. Kerr, Shedding Light on Chevron: An

Empirical Study of the Chevron Doctrine in

the U.S. Courts of Appeals, 15 Yale J. on

Reg. 1 (1998) .................................................... 21, 22

Richard J. Pierce, Administrative Law

Treatise (5th ed. 2010) ...........................................22

Antonin Scalia & Bryan A. Garner, Reading

Law: The Interpretation of Legal Texts

(2012) ......................................................................33

1

PETITION FOR A WRIT OF CERTIORARI

Michelle Valent respectfully petitions for a writ

of certiorari to review the judgment of the U.S. Court

of Appeals for the Sixth Circuit.

OPINIONS BELOW

The opinion of the U.S. Court of Appeals for the

Sixth Circuit is reported at 918 F.3d 516 and

reproduced in App. 1–29. The final order of the

Commissioner of Social Security is reported at DAB

No. A-15-104 and reproduced in App. 33–74.

JURISDICTION

The Court of Appeals entered judgment on

March 20, 2019. App. 1. On June 13, 2019, Justice

Sotomayor extended the time within which to file a

petition for a writ of certiorari to and including

August 16, 2019. This Court has jurisdiction under

28 U.S.C. § 1254(1).

STATUTORY PROVISIONS INVOLVED

Pertinent statutes and

reproduced in App. 226–302.

regulations

are

2

STATEMENT

In this case, Ms. Valent, a disabled woman,

performed unpaid volunteer work for her brother’s

veterans organization while receiving disability

benefits under Title II of the Social Security Act.

Because Ms. Valent had been receiving

disability benefits for at least 24 months, the Act

prevented the Commissioner from using Ms. Valent’s

“work activity” as “evidence” that she was “no longer

disabled.” 42 U.S.C. § 421(m)(1)(B). Brushing this

protection aside, the Commissioner concluded that

Ms. Valent should have known her unpaid “work”

was “material” to whether she remained “disabled,”

and therefore that she was subject to civil penalties

for failing to disclose her work. See 42 U.S.C.

§ 1320a-8(a)(1)(C). The Commissioner ordered Ms.

Valent to pay $126,210 in monetary sanctions.

A divided Sixth Circuit panel affirmed the

Commissioner’s

order,

deferring

to

the

Commissioner’s interpretation of the law under “the

Chevron framework.” App. 8 (citing Chevron, U.S.A.,

Inc. v. NRDC, 467 U.S. 837, 842 (1984)). Judge

Kethledge dissented. App. 19.

In affirming the order, the Sixth Circuit

exhibited “reflexive deference” to the Commissioner’s

interpretation of the statute. Pereira v. Sessions, 138

S. Ct. 2105, 2120 (2018) (Kennedy, J., concurring).

The court found the statute ambiguous based on “a

conclusory statement about” an apparent conflict

between “two provisions at issue, and the mere fact

of another court’s conflicting decision.” App. 25

(Kethledge, J., dissenting). The court “hardly

employed” the “tools of statutory construction” at all.

3

App. 21. “Rather than analyze the interpretive issue,

the majority merely frame[d] it” before concluding

that the statute was ambiguous. App. 21. The

majority then deferred to an interpretation that “is

almost a test case for how far an agency can go in

Chevron’s ‘step two.’ ” App. 26 (Kethledge, J.,

dissenting). Indeed, as Judge Kethledge concluded in

dissent, “the agency’s interpretation—now the law of

our circuit—construes the words of the statute in a

manner that no ordinary speaker of the English

language would recognize.” App. 21.

The Sixth Circuit’s opinion “suggests an

abdication of the Judiciary’s proper role in

interpreting federal statutes.” Pereira, 138 S. Ct. at

2120 (Kennedy, J., concurring). The culprit is the

deference doctrine adopted by the Court in Chevron,

467 U.S. at 842–44. “Chevron requires a federal court

to accept the agency’s construction of” an ambiguous

statute, “even if the agency’s reading differs from

what the court believes is the best statutory

interpretation.” Nat’l Cable & Telecomms. Ass’n v.

Brand X Internet Servs., 545 U.S. 967, 980 (2005).

Given the serious concerns several Members of the

Court

have

raised

about

Chevron,

grave

inconsistency and uncertainty in applying the

doctrine, and lower courts’ abdication of the judicial

role, “the time has come to face the behemoth.”

Gutierrez-Brizuela v. Lynch, 834 F.3d 1142, 1149

(10th Cir. 2016) (Gorsuch, J., concurring). The Court

should grant review to overrule Chevron.

In the alternative, the Court should grant

certiorari to narrow Chevron’s reach. The Sixth

Circuit deferred because two clauses of § 421(m)

“appear to conflict with one another.” App. 8. But

4

“[d]irect conflict is not ambiguity” under Chevron.

Scialabba v. Cuellar de Osorio, 573 U.S. 41, 76

(2014) (Roberts, C.J., concurring in judgment). The

task of reconciling conflicting laws is a traditional

judicial function reserved for the courts, not a gapfilling policy judgment delegated to agencies under

Chevron. An agency’s attempt to resolve statutory

conflict is thus ineligible for Chevron deference. Yet,

like the Sixth Circuit here, federal courts routinely

defer to agencies whenever statutes seem to conflict.

The Court should grant certiorari to clarify that

Chevron does not compel courts to abandon their

traditional duty of resolving statutory conflicts.

Finally, if the Court declines to grant certiorari

to overrule or narrow Chevron, the Court should

summarily reverse to redress the Sixth Circuit’s

stark violation of a basic principle of administrative

law. The Sixth Circuit affirmed the order based on

an investigator’s allegation, which after a formal

hearing the agency’s finder of fact expressly

concluded was “unsupported by the evidence,” App.

155, and which the Commissioner concedes was not a

basis for his order, App. 23–24 (Kethledge, J.,

dissenting) (citing Oral Arg. at 28:02). That is the

administrative-law equivalent of relying on the

prosecutor’s allegation, repudiated by the trial judge,

to uphold a conviction. Chenery forbids this result.

Under Chenery, a reviewing court may affirm an

agency decision based only on a rationale that the

agency itself articulated; for it is a “basic legal

principle[]” that “judicial judgment cannot be made

to do service for an administrative judgment.”

Gonzales v. Thomas, 547 U.S. 183, 186 (2006) (per

curiam) (quoting SEC v. Chenery, 318 U.S. 80, 88

5

(1943)). The court of appeals’ error warrants

“summary reversal.” Id. at 185.

I.

Legal Background

A. Title II of the Social Security Act

Title II of the Social Security Act of 1935

provides social insurance benefits to individuals

“whose disability prevents them from pursuing

gainful employment.” Heckler v. Day, 467 U.S. 104,

106 (1984). To qualify as disabled, an individual

must meet two related requirements. Barnhart v.

Walton, 535 U.S. 212, 217 (2002). First, the

individual must be unable to “engage in any

substantial

gainful

activity.”

42

U.S.C.

§ 423(d)(1)(A). Second, this inability must stem from

a “medically determinable physical or mental

impairment which can be expected to result in death”

or to last “not less than 12 months.” Id. Individuals

remain eligible for benefits only as long as they are

disabled. The Commissioner of Social Security must

periodically verify “that the beneficiary continues to

be eligible for the program” through “a process called

a ‘continuing disability review.’ ” App. 3 (citing 42

U.S.C. § 421(i), (m)).

The Commissioner has interpreted “substantial

gainful activity” to mean work that “[i]nvolves doing

significant and productive physical or mental duties;

and [i]s done (or intended) for pay or profit.” 20

C.F.R. § 404.1510. To decide whether an individual is

able to engage in “substantial gainful activity,” the

Commissioner typically considers a beneficiary’s

“earnings.” Id. § 404.1574. The Commissioner has

promulgated guidelines on the amounts of earnings

6

that rise to the level of substantial gainful activity.

Id. § 404.1574(b).

As an alternative test for determining an

individual’s ability to engage in “substantial gainful

activity,” the Commissioner may, in some situations,

look beyond earnings and examine a beneficiary’s

work

activity.

Id.

§ 404.1574(b)(3)(ii).

The

Commissioner may examine “work activity” to see

whether it is “comparable to that of unimpaired

people” in the relevant labor market, or whether it is

“worth

the

amounts”

established

by

the

Commissioner’s

earning

guidelines.

Id.

§ 404.1574(b)(3)(ii). As explained below, however,

Congress curtailed the Commissioner’s use of this

alternative “work activity” test in 1999, by

prohibiting the Commissioner from considering, as

evidence of disability, the “work activity” of

individuals who have been receiving disability

benefits for 24 months. See id. § 404.1574(b)(3)(iii)

(implementing exemption).

B. The Ticket to Work and Work Incentives

Improvement Act of 1999

Individuals who have been disabled for over 24

months have strong incentives to remain on the

disability rolls. At 24 months, beneficiaries get access

to Medicare coverage. 42 U.S.C. § 426(b)(2)(A). So in

addition to losing their disability cash payments,

these individuals risk losing health insurance if they

become ineligible for disability benefits. See 42

C.F.R. § 406.12(d). Prior to 1999, this risk was a

significant “work disincentive.” Pub. L. 106-170,

§ (2)(a)(6), 113 Stat. 1860 (Dec. 17, 1999).

7

In 1999, Congress amended the Social Security

Act to reduce this disincentive and “to help

individuals with disabilities return to work.” Id.

§ (2)(a)(11). As relevant here, Congress provided that

when an individual has received disability benefits

for over 24 months, “no work activity engaged in by

the individual may be used as evidence that the

individual is no longer disabled.” 42 U.S.C.

§ 421(m)(1)(B). In addition, Congress prohibited the

Commissioner from scheduling a continuing

disability review “solely as a result of the individual’s

work activity.” Id. § 421(m)(1)(A). Congress, however,

continued to permit “regularly scheduled” reviews

“not triggered by work.” Id. § 421(m)(2)(A). Congress

also allowed the Commissioner to terminate benefits

“in the event that the individual has earnings that

exceed the level of earnings established by the

Commissioner to represent substantial gainful

activity.” Id. § 421(m)(2)(B).

The

Commissioner

promulgated

rules

implementing these “special exceptions” for 24month beneficiaries in 2006. Exemption of Work

Activity as a Basis for a Continuing Disability

Review, 71 Fed. Reg. 66,840, 66,843 (Nov. 17, 2006).

In that rulemaking, the Commissioner concluded

that 42 U.S.C. § 421(m)(1)(B) bars the agency from

“consider[ing] information about” work activity “to

determine that you are able to engage in substantial

gainful activity and are, therefore, no longer

disabled.” Id. at 66,846. Considering § 421(m)(2)(B)

in light of the prohibition set forth in § 421(m)(1)(B),

the Commissioner concluded that the statute allows

the agency to “consider[] earnings alone” and not

work activity, when examining a 24-month

beneficiary’s “substantial gainful activity.” Id. at

8

66,846, 66,854; see id. at 66,846 (“[W]e will not

consider other information in addition to your

earnings.”); see 20 C.F.R. § 404.1574(b)(3)(iii).

C. Administrative Sanctions Provisions

Under the Social Security Act, 42 U.S.C.

§ 1320a-8, the Commissioner may impose civil

penalties and assessments on any person who

“withholds disclosure of[] a fact which the person

knows or should know is material to the

determination of any initial or continuing right” to

disability benefits, if the person “knows, or should

know, that the withholding of such disclosure is

misleading.” 1 A “material fact” is “one which the

Commissioner of Social Security may consider in

evaluating whether an applicant is entitled to

benefits.” Id. § 1320a-8(a)(2).

The Commissioner may not sanction “any

person” until after “written notice and an

opportunity for the determination to be made on the

record after a hearing at which the person is entitled

to be represented by counsel, to present witnesses,

and to cross-examine witnesses against the person.”

42 U.S.C. § 1320a-8(b)(2). This language triggers

“the formal adjudication requirements of the

Administrative Procedure Act (APA).” Cappetta v.

Commissioner of Social Security, 904 F.3d 158, 160

n.1 (2d Cir. 2018); see 5 U.S.C. § 554(a). Under these

1 The Commissioner may impose “a civil money penalty of not

more than $5,000” each time a beneficiary receives cash

benefits “while withholding disclosure of such fact,” and an

assessment “of not more than twice the amount of benefits or

payments paid.” 42 U.S.C. § 1320a-8(a)(1).

9

formal procedures, an Administrative Law Judge

(ALJ) employed by the U.S. Department of Health

and Human Services takes evidence and renders “an

initial decision, based only on the record.” 20 C.F.R.

§ 498.220. The Inspector General (IG) of the Social

Security

Administration,

exercising

the

Commissioner’s prosecutorial function, bears “the

burden of persuasion” during this proceeding, id.

§ 498.215(b)(2), which is “judged by a preponderance

of the evidence.” Id. § 498.215(c).2

Parties may appeal the initial decision to the

Departmental Appeals Board (the Board), which

“limit[s] its review to whether the ALJ’s initial

decision is supported by substantial evidence on the

whole record or contained error of law.” Id.

§ 498.221(i). The Board’s “recommended decision

becomes the Commissioner’s final decision 60 days

after the [Board] serves the decision on the parties,

unless the decision is remanded to the ALJ or the

Commissioner modifies the decision.” Cappetta, 904

F.3d at 161 (citing 20 C.F.R. § 498.222(a)).

A final decision of the Commissioner that

imposes sanctions is reviewable in a federal court of

appeals. 42 U.S.C. § 1320a-8(d)(1).

II. Factual Background

Ms. Valent suffers from several debilitating

psychiatric diseases including anxiety disorder,

depression, and bipolar disorder. App. 101. Based on

2

The Commissioner has delegated prosecuting and

investigative functions under the statute to the agency’s

Inspector General. 20 C.F.R. § 498.102.

10

her mental impairments and inability to engage in

substantial gainful activity, Ms. Valent qualified to

receive Title II disability benefits in 2003. App. 101.

Six years later, Ms. Valent began to volunteer

for the War Era Veterans Alliance, an organization

“founded and owned by her brother and sister-inlaw.” App. 4. According to her brother, Ms. Valent

was allowed to work “if she chose to,” with “no

schedule or set hours.” App. 107. Ms. Valent would

“do little things for War Era Veterans Alliance to

help her sense of self-worth.” App. 109. Ms. Valent’s

brother testified that he “gift[ed] her about $12,000

per year” because “he promised his dad to take care

of her,” but that he did not compensate Ms. Valent

for her volunteer work. App. 107, 109–10.

In 2012, the IG received a tip from a former

employee of the Veterans Alliance. The tipster

alleged that Ms. Valent “had been working for War

Era Veterans Alliance.” App. 101. In response, IG

employees

began

investigating

Ms.

Valent,

surveilling her home and interviewing witnesses.

App. 103–04.

At the close of the investigation, the IG sent Ms.

Valent a letter alleging that she had failed to report

work for the Veterans Alliance. App. 219–20. The

letter also alleged, as an aggravating factor, that Ms.

Valent was paid “$400 per week.” App. 221. The IG

proposed that Ms. Valent pay a $100,000 civil

monetary penalty and a $68,547 assessment, and

11

requested a check “in the amount of $168,547.” App.

222–23.3

Ms. Valent requested a hearing before an ALJ.

III. Proceedings Below

A. Administrative Proceedings

After hearing testimony from multiple witnesses

and admitting numerous exhibits into evidence, the

ALJ issued an initial decision concluding that there

was “no basis for the imposition” of sanctions against

Ms. Valent. App. 188. The ALJ concluded that, as a

matter of law, Ms. Valent was protected by 42 U.S.C.

§ 421(m)(1)(B), which prohibits the Commissioner

from using her “work activity” as evidence that she is

no longer disabled. App. 214–15. The IG appealed

this initial decision to the Departmental Appeals

Board. App. 161.

The Board reversed and remanded the matter to

the ALJ. App. 163. Notwithstanding § 421(m)(1)(B),

the Board reasoned that “work is relevant in

determining whether amounts paid to a recipient are

earnings from work, [so] work is a fact” the

Commissioner could consider in determining

whether Ms. Valent remains disabled. App. 177.

On remand, the ALJ again concluded that there

was “no basis” to impose sanctions on Ms. Valent.

App. 75. The ALJ concluded that “in light of the lack

3 In

separate proceedings, the Commissioner first terminated

Ms. Valent’s disability benefits and later reinstated them, after

finding on further review that she remained disabled. The

merits of these separate decisions are not at issue in this case.

12

of clarity” in the Commissioner’s regulations and forms,

Ms. Valent had no reason to know that her failure to

report work activity was misleading. App. 136–37.

In the alternative, the ALJ concluded that the

IG’s proposed sanctions were unreasonable. App.

154–57. The ALJ found no evidence that Ms. Valent

“engaged in any more than sporadic work” for the

War Era Veterans Alliance. App. 156. And the ALJ

found that the IG’s allegation that Ms. Valent was

paid was “unsupported by the evidence.” App. 155.

Finding her not culpable, the ALJ imposed no

sanctions. App. 157.

The Board again reversed. In relevant part, the

Board accepted the ALJ’s findings of fact, seeing no

“compelling reason” to depart from them. App. 69, 72

& n.11.4 The Board specifically agreed with the ALJ

that the evidence was “not sufficient to establish . . .

that Ms. Valent was paid $400 a week.” App. 69. But

the Board disagreed with the ALJ’s legal conclusions,

imposing a civil money penalty of $75,000 and an

assessment of $51,210 on Ms. Valent. App. 74.

The Board’s decision became the final decision of

the Commissioner, and it was served on Ms. Valent

on March 15, 2016. App. 30–31. Ms. Valent timely

petitioned for judicial review on May 12, 2016.5

4 The Board only “disagree[d] with the ALJ’s complete rejection

of” Ms. Valent’s appearance on the Alliance’s “website as some

evidence of [her] employment.” App. 69. This disagreement is

immaterial, because both the ALJ and the Board found that she

did work for the Alliance.

5 Ms. Valent erroneously filed suit in the U.S. District Court for

the Eastern District of Michigan. No. 16-cv-11720. The district

13

B. Court Proceedings

By a 2-1 vote, the Sixth Circuit affirmed the

Commissioner’s order.

The court began by misstating the basis for the

Commissioner’s decision. Ignoring the adjudicator’s

unambiguous findings, App. 155–56, as well as the

Commissioner’s concession to the contrary, App. 23–

24 (Kethledge, J., dissenting), the majority asserted

that the Commissioner had penalized Ms. Valent for

failing to report “work activity that generated

earnings,” App. 6; cf. App. 23 (Kethledge, J.,

dissenting).

Proceeding from this fictional premise, the court

addressed the following question: whether failure to

report “work activity that generates earnings

constitutes the omission of a ‘material fact’ under”

the Act. App. 8. The court applied the Chevron

framework to analyze this question. App. 7.

Under step one of Chevron, the court summarily

concluded that § 421(m) was “ambiguous with

respect to the question at issue” because two of its

clauses “appear to conflict with one another.” App. 8.

In particular, the court reasoned, “[section]

421(m)(1)(B) appears to proscribe taking [work]

activity into account, yet the Commissioner would

need to do so in order to determine whether the

individual has earnings that amount to ‘substantial

gainful activity’ ” under § 421(m)(2)(B). App. 9. The

judge transferred the case to the Sixth Circuit under 28 U.S.C.

§ 1631, curing the jurisdictional defect. Stipulated Order, Doc.

No. 32 (Sept. 8, 2017); see Holmes Grp., Inc. v. Vornado Air

Circulation Sys., Inc., 535 U.S. 826, 834 (2002).

14

court also reasoned that another circuit’s decision—

which had upheld the Commissioner’s interpretation

under Chevron step one and had found no ambiguity

with respect to the question—was itself “evidence of

ambiguity in the statutory scheme.” App. 10 (citing

Cappetta, 904 F.3d at 168).

Applying step two of Chevron, the court deferred

to the Commissioner’s interpretation. App. 11. Under

that interpretation, the Commissioner “cannot take

work activity into account” to determine whether a

beneficiary remains medically impaired, but the

Commissioner “can take work activity into account”

to determine “whether a beneficiary is engaging in

substantial gainful activity.” App. 10–11. The court

held that this was “permissible” because the court

assumed that otherwise, the Commissioner would be

“unable to examine a beneficiary’s substantial

gainful activity.” App. 11.

In dissent, Judge Kethledge first contradicted

the majority’s central premise: He observed that “the

Commissioner imposed the sanction based solely on

Valent’s failure to report ‘work activity’ period—

without regard to whether she received any earnings

from that activity.” App. 23 (emphasis added). The

court’s erroneous “characterization” of the case as

involving “earnings,” he argued, “distorts the

question presented by blending a fact that the

agency may use as evidence against a beneficiary

(i.e., her earnings) with a fact the agency may not

(i.e., her work activity).” App. 23.

Turning to the merits, Judge Kethledge

criticized the court’s failure to “use all the tools of

construction” to read the statute “as ‘an harmonious

whole,’ ” and its determination that the statute was

15

ambiguous based on nothing more than a “putative

conflict” with § 421(m)(2)(B). App. 24–26. He also

criticized the Commissioner’s “amputation” of

unambiguous statutory language. App. 27. As he

explained:

“[T]he statute is ‘clear’ on what it precludes:

section 421(m)(1)(B) says the Commissioner

may not use a beneficiary’s work activity as

evidence that she is not ‘disabled’ simpliciter,

which means the agency cannot use a

beneficiary’s work activity as evidence for

any part of a determination that she is not

disabled. Nothing about that proscription is

ambiguous. What the agency proposes here is

not interpretation of a statute, but

amputation, by which the agency (and now

our court) discards roughly half the

protection that Congress unambiguously

provided to beneficiaries in § 421(m)(1)(B).”

App. 26–27.

REASONS FOR GRANTING THE PETITION

I. The Court Should Reconsider Chevron.

“Given the concerns raised by some Members of

this Court, it seems necessary and appropriate to

reconsider, in an appropriate case, the premises that

underlie Chevron and how courts have implemented

that decision.” Pereira, 138 S. Ct. at 2121 (Kennedy,

J., concurring) (citations omitted). Whether to

reconsider Chevron is an important question of

federal law, and this case is an appropriate vehicle

for doing so.

16

A. Chevron Should Be Overruled.

Chevron has been criticized by multiple

Members of the Court as erroneous, poorly reasoned,

unworkable, and indeed unconstitutional. These

criticisms support reconsideration.

1. Chevron is inconsistent with the APA.

“Heedless of the original design of the APA,” the

Court in Chevron “held that agencies may

authoritatively resolve ambiguities in statutes.”

Perez v. Mortgage Bankers Ass’n, 135 S. Ct. 1199,

1211 (2015) (Scalia, J., concurring in judgment)

(citing Chevron, 467 U.S. 842–43). The APA provides

that “the reviewing court shall decide all relevant

questions of law” and “interpret constitutional and

statutory provisions.” 5 U.S.C. § 706 (emphasis

added). At least four Justices, and many scholars,

agree that section 706 “seems to require de novo

review on questions of law.” Kisor v. Wilkie, 139 S.

Ct. 2400, 2433 (2019) (Gorsuch, J., concurring in

judgment). Yet Chevron requires courts to “accept

the agency’s construction” of an ambiguous statute,

even when it is not “the best statutory

interpretation.” Brand X, 545 U.S. at 980.

Chevron has also been criticized for tampering

with the APA’s structure. The APA exempts

“interpretative rules”—statements advising the

public of an agency’s construction of a statute—from

notice-and-comment requirements. 5 U.S.C. § 553(b).

This exemption was based on Congress’s expectation

that agency interpretations would not have the “force

of law.” Mortgage Bankers Ass’n, 135 S. Ct. at 1212

(Scalia, J., concurring in judgment). But Chevron

deference defies that congressional expectation, as

interpretive “rules that command deference do have

17

the force of law.” 135 S. Ct. at 1212 (Scalia, J.,

concurring in judgment).

2. Chevron is unconstitutional. First,

Article III judges have a “duty . . . to say what the

law is.” Marbury v. Madison, 1 Cranch 137, 177

(1803). This duty means that a court cannot “be

bound to adopt the [statutory] construction given by

the head of a department.” Decatur v. Paulding, 14

Pet. 497, 515 (1840). Chevron conflicts with that

duty, insofar as it forces judges “to abandon what

they believe is ‘the best reading of an ambiguous

statute’ in favor of an agency’s construction.”

Michigan v EPA, 135 S. Ct. 2699, 2712 (2015)

(Thomas, J., concurring).

Second, by allowing agencies to assume the

judicial role in their own cause, Chevron also leads to

“the very sort of due process (fair notice) . . . concerns

the framers knew would arise if the political

branches intruded on judicial functions.” GutierrezBrizuela, 834 F.3d at 1152 (Gorsuch, J., concurring).

Indeed, in the teeth of long-held principles of stare

decisis, Chevron even allows agencies to overrule

judicial precedents interpreting ambiguous statutes.

Brand X, 545 U.S. at 980.

Third, Chevron sits uneasily with the

Constitution’s exclusive allocation of legislative

authority to Congress. Gutierrez-Brizuela, 834 F.3d

at 1153–55 (Gorsuch, J., concurring); see Wayman v.

Southard, 10 Wheat. 1, 42–43 (1825). Chevron

unrealistically assumes that Congress implicitly

delegates “legislative” policymaking authority to an

agency whenever there is a statutory ambiguity.

18

Chevron, 467 U.S. at 844.6 The result of this fiction is

an unprompted “aggrandizement of federal executive

power at the expense of the legislature.” Egan v.

Delaware River Port Auth., 851 F.3d 263, 279 (3d

Cir. 2017) (Jordan, J., concurring). No wonder

citizens, confronting countless agency rules and

orders justified by statutory ambiguity, “can perhaps

be excused for thinking” that agencies are “really

doing the legislating.” City of Arlington v. FCC, 569

U.S. 290, 315 (2013) (Roberts, C.J., dissenting).

The constitutional values undermined by

Chevron—judicial independence, due process, and

legislative power—may seem abstract, but they are

very real for citizens like Ms. Valent. Chevron leaves

ordinary citizens like her at sea: without recourse to

“an army of perfumed lawyers and lobbyists,” they

must “guess” how the executive will interpret laws at

any given time, on pain of ruinous consequences if

they guess wrong. Gutierrez-Brizuela, 834 F.3d at

1152 (Gorsuch, J., concurring). What oracle, let alone

a private citizen of modest means with no legal

training, could have divined the Commissioner’s

“amputation” of the law in this case? App. 27

(Kethledge, J, dissenting). Yet the Commissioner

held not only that Ms. Valent got the law wrong, but

that she “should [have] know[n]” how the agency

would construe the law under Chevron, 42 U.S.C.

6 But

cf. Abbe R. Gluck & Lisa Schultz Bressman, Statutory

Interpretation from the Inside—An Empirical Study of

Congressional Drafting, Delegation, and the Canons: Part I, 65

Stan. L. Rev. 901, 996 (2013) (“[M]ost of our [congressional

staffer] respondents told us that their knowledge of Chevron

does not mean that they intend to delegate whenever ambiguity

remains in finalized statutory language.”).

19

§ 1320a-8(a)(1)(C), and should be ordered to pay

crushing monetary penalties. An agency that is

subject to constitutionally appropriate checks,

enforced by courts independently determining the

meaning of the law, would be much less likely to

deploy aggressive legal theories to impose such

massive penalties on disabled individuals.

Despite the weighty criticisms that have been

leveled at Chevron, the Court has never seriously

attempted to square Chevron with the Constitution.

The Court asserted in passing that Chevron is

consistent with a “long recognized . . . principle of

deference

to

administrative

interpretations.”

Chevron, 467 U.S. at 844. But recent scholarship

undermines any historical justification for Chevron,

further supporting reconsideration. See Aditya

Bamzai, The Origins of Judicial Deference to

Executive Interpretation, 126 Yale L.J. 908 (2017).

3. Chevron cannot be applied predictably

or consistently. “Chevron has presented its fair

share of practical problems in its administration.”

Gutierrez-Brizuela, 834 F.3d at 1157 (Gorsuch, J.,

concurring).

Scholars

who

defend

Chevron

acknowledge that “jurisprudential inconsistency has

produced a ridiculous degree of doctrinal complexity

that provides endless fodder for discussion (and

discontent) about Chevron.” Nicholas R. Bednar &

Kristin E. Hickman, Chevron’s Inevitability, 85 G.

Wash. L. Rev. 1392, 1398 (2017). Others are less

charitable. See Jack M. Beermann, Chevron at the

Roberts Court: Still Failing After All These Years, 83

Fordham L. Rev. 731, 750 (2014) (Chevron doctrine is

“an incoherent, imprecise, and arbitrarily applied set

20

of principles

construction”).

for

reviewing

agency

statutory

Chevron is unworkable because it rests on a

shaky foundation. Under Chevron, cases turn “on an

entirely personal question, one subject to a certain

sort of ipse dixit: is the language clear, or is it

ambiguous?” Brett M. Kavanaugh, Fixing Statutory

Interpretation, 129 Harv. L. Rev. 2118, 2142 (2016).

Judges “have wildly different conceptions of whether

a particular statute is clear or ambiguous.” Id. At

2152. And there are no “neutral principles” for

deciding what is ambiguous. Id. At 2153. This makes

it extraordinarily difficult, if not impossible, for

courts to apply Chevron consistently and evenhandedly, which invites the suspicion that “judges’

personal views are infecting these kinds of cases.” Id.

At 2142.

In sum, Chevron makes it impossible for private

parties to know in advance what standard of review

will govern judicial review of reams of agency rules

and adjudications, and, more fundamentally, to

understand the contours of the law.

***

Chevron’s deformity has now come into full view,

and the doctrine is ripe for reconsideration. There is

little doubt that Chevron’s continued viability is an

important federal question. Chevron, after all, is an

“important, frequently invoked, once celebrated, and

now increasingly maligned precedent.” Pereira, 138

S. Ct. at 2121 (Alito, J., dissenting). The Court, to be

sure, could simply ignore Chevron. See id.

(concluding that the Court “is simply ignoring

Chevron”). But that would do little to make the law

21

applied by lower courts correct, rational, and

workable. It would also do little for Ms. Valent and

citizens like her, who must contend with the

reflexive deference routinely afforded to executive

agencies by the federal courts. Chevron should be

overturned in its entirety.

B. The Court Should Limit Chevron To Curb

Reflexive Deference.

Even if the Court does not overrule Chevron

outright, the Court should at least “expand on” the

deference doctrine’s exceptions “to clear up some

mixed messages” it has sent in the past. Kisor, 139

S. Ct. at 2414.

Although this Court has suggested, in passing,

that judges should apply “rigorously, in all cases,

statutory limits on agencies’ authority,” City of

Arlington, 569 U.S. at 307, “that is hardly what

happens in reality. Instead, the federal courts have

become habituated to defer to the interpretive views

of executive agencies, not as a matter of last resort

but first.” App. 20 (Kethledge, J., dissenting). “[A]ll

too often, courts abdicate” their judicial duty “by

rushing to find statutes ambiguous, rather than

performing a full interpretative analysis.” Arangure

v. Whitaker, 911 F.3d 333, 336 (6th Cir. 2018)

(Thapar, J.). 7 Such knee-jerk deference “abrogates

7 In the great majority of cases, courts find statutes ambiguous.

See Kent Barnett & Christopher J. Walker, Chevron in the

Circuit Courts, 116 Mich. L. Rev. 1, 33–34 (2017) (concluding

that circuit courts find ambiguity at Chevron step one 70% of

the time, based on a sample of over 1,000 cases); Orin S. Kerr,

Shedding Light on Chevron: An Empirical Study of the Chevron

22

separation of powers without even the fig leaf of

Congressional authorization.” Voices for Int’l Bus. &

Educ., Inc. v. NLRB, 905 F.3d 770, 781 (5th Cir. 2018)

(Ho, J., concurring).

One can hardly blame lower courts for deferring

so easily under Chevron. After all, no one knows “just

how rigorous Chevron step one is supposed to be,”

Gutierrez-Brizuela, 834 F.3d at 1157 (Gorsuch, J.,

concurring), and this Court has applied Chevron

reflexively, too. 8 Cf. Kisor, 139 S. Ct. at 2414–15

(clearing “mixed messages” sent by Supreme Court

decisions applying Auer deference “without

significant analysis of the underlying regulation” or

“without careful attention to the nature and context

of the interpretation”).

Even assuming, arguendo, that Chevron should

not be overruled altogether, Chevron deference is

proper only after a court has exhausted all the tools

of statutory interpretation—“when the legal toolkit is

empty and the interpretative question still has no

single right answer.” Kisor, 139 S. Ct. at 2415 (citing

Doctrine in the U.S. Courts of Appeals, 15 Yale J. on Reg. 1, 30

(1998) (similar).

8 See, e.g., Yellow Transp., Inc. v. Michigan, 537 U.S. 36, 45–46

(2002) (deferring because provision was “silent” on question at

issue); Nat’l R.R. Passenger Corp. v. Boston & Maine Corp., 503

U.S. 407, 417–19 (1992) (deferring because agency

interpretation was “not in conflict with the plain language of

the statute”); Pauley v. Bethenergy Mines, Inc., 501 U.S. 680,

696–97 (1991) (deferring because statute was “complex and

highly technical”); see also Richard J. Pierce, Administrative

Law Treatise 221 (5th ed. 2010) (attributing inconsistent lower

court behavior to fact that Court “has not been consistent and

conscientious in applying Chevron”).

23

Chevron, 467 U.S. at 843 n.9). A court “cannot wave

the ambiguity flag just because it found the [statute]

impenetrable on first read.” Id. Instead, “the court

must ‘carefully consider’ the text, structure, history,

and purpose of” a statute “in all the ways it would if

it had no agency to fall back on.” Id. As with agency

interpretations of their own regulations, a rigorous

understanding of Chevron step one implies that

courts “will almost always” apply “the best

interpretation,” and will not “put a thumb on the

scale in favor of an agency.” Kisor, 139 S. Ct. at 2448

(Kavanaugh, J., concurring in judgment). At the very

least, certiorari is warranted to reinforce this crucial

limit on Chevron deference.

C. Stare Decisis Does Not Weigh Against

Reconsidering Chevron.

Principles of stare decisis should not deter this

Court from reconsidering the judicially-created

interpretative methodology articulated in Chevron.

Assuming that the same stare decisis principles that

apply to judicial interpretations of statutes apply to

judicial methodologies for interpreting statutes,

special justifications warrant reconsidering Chevron.

Chevron is a doctrine of “this Court’s own

creation.” S. Dakota v. Wayfair, Inc., 138 S. Ct. 2080,

2096 (2018). The Court must therefore revisit

Chevron, “whether or not Congress can or will act in

response.” Id. At 2097.

Moreover, there is no reason to believe the

political branches will act against their interests to

restrain judicial deference to agencies. For the very

reason that Chevron distorts the Constitution’s

allocation of powers, allowing the Executive both to

24

make law and to say what the law is, there is no

reason to think that Chevron will be redressed by the

political branches. Having voluntarily relinquished

interpretative authority to the President and his

subordinate officers, the Court cannot sit by hoping

that the President will one day voluntarily

relinquish this power and sign a bill abolishing

Chevron. Cf. Art. I, § 7.

Nor can the Court expect Congress to take the

extraordinary step of overriding a presidential veto

to restore the Court’s institutional prerogatives. This

is true not only because veto overrides are rare, but

also because Chevron’s diffusion of legislative

accountability results in weighty political advantages

to individual members of Congress. Chevron allows

legislators to take credit for legislation and to

influence regulatory outcomes while avoiding “the

difficult [and often unpopular] work of reaching

consensus on divisive issues.” See Egan, 851 F.3d at

279 (Jordan, J., concurring); cf. Chevron, 467 U.S. at

865 (noting that “perhaps Congress was unable to

forge a coalition on either side of the question”).

Given these perverse incentives, “[n]o one can look

to” legislators “for effective relief” from the mischief

Chevron has caused. Rucho v. Common Cause, 139

S. Ct. 2484, 2523 (2019) (Kagan, J., dissenting). If

ambition is “to counteract ambition,” The Federalist

No. 51 (James Madison), then the Court alone must

shoulder the responsibility of reclaiming its

institutional prerogatives by overturning, or at least

narrowing, Chevron.

Overruling Chevron will not harm legitimate

private reliance interests. See Wayfair, Inc., 138

S. Ct. at 2098. Chevron’s very premise is that

25

political officials get to change course without regard

to precedent, based on their current preferred

interpretation of ambiguous statutes. Brand X, 545

U.S. at 982–83. Regulated parties cannot

legitimately rely on such ephemeral precedents to

guide their private conduct. Private reliance

interests would be better served by a body of judicial

precedents that cannot be altered except through the

ordinary channels of judicial reconsideration or

legislation, as would be the case without Chevron.

D. This Case Is a Suitable Vehicle for

Reconsidering the Validity and Scope of

Chevron.

This case presents Chevron in its most

deferential form. To begin with, instead of

interpreting the law, the court merely “frame[d]” the

issue and pronounced the statute ambiguous based

on a putative conflict before applying any tools of

interpretation. App. 21 (Kethledge, J., dissenting).

The court then deferred to an agency interpretation

that is “almost a test case for how far an agency can

go in Chevron step two.” App. 26. And the court did

so in the charged context of an administrative

adjudication imposing “massive liability” on a private

citizen, a context in which Chevron’s fair notice

problems are most acute. Christopher v. SmithKline

Beecham Corp., 567 U.S. 142, 155 (2012) (describing

Auer’s similar notice problems).

Ms. Valent is likely to prevail on remand under

a less deferential standard of review. Absent

Chevron deference, the weight (if any) to be given to

the agency’s view “will depend upon the

thoroughness evident in its consideration, the

26

validity of its reasoning, its consistency with earlier

and later pronouncements, and all those factors

which give it power to persuade, if lacking power to

control.” Skidmore v. Swift & Co., 323 U.S. 134, 140

(1944).

The Commissioner’s interpretation of the statute

in this case is neither considered nor consistent. In

fact, it is facially inconsistent with existing

regulations promulgated by the Commissioner after

notice and comment. In that rulemaking, the

Commissioner interpreted “section 221(m)(1)(B) of

the Act” to mean that when “you perform work as an

employee after you have received [disability] benefits

for at least 24 months, . . . we may not consider

information about the activities you perform in that

work . . . to determine that . . . you are able to engage

in substantial gainful activity and are, therefore, no

longer disabled.” 71 Fed. Reg. at 66,846.

To

implement

this

interpretation,

the

Commissioner promulgated rules assuring 24-month

beneficiaries that the Social Security Administration

will consider “earnings alone” to determine “whether

you have engaged in substantial gainful activity,”

and promising such beneficiaries that “we will not

consider the activities you perform in the work you

are

doing

or

have

done.”

20

C.F.R.

§§ 404.1574(b)(3)(iii), 416.994(b)(8)(ii).

As Judge Kethledge observed, “that quite

possibly amounts to an assurance to the beneficiary

herself that her work activity was not material.”

App. 29. Yet that is precisely the opposite of what the

Commissioner now says the statute means. See App.

10–11 (“[T]he Commissioner argues [that] the

Administration can take work activity into account

27

in determining whether a beneficiary is engaging in

substantial

gainful

activity.”).

Rather

than

confronting

this

inconsistency

between

its

interpretations, the Commissioner left these binding

rules “unmentioned” in his brief before the Sixth

Circuit. App. 28 (Kethledge, J., dissenting).

The Commissioner’s new interpretation of the

statute is unpersuasive: “discard[ing] roughly half

the protection that Congress unambiguously

provided” is no way to reconcile apparent tensions in

statutory provisions. App. 27 (Kethledge, J.,

dissenting).

Ms. Valent’s interpretation, by contrast, gives

full meaning to every word of the statute, and it is

consistent with the Administration’s regulations.

Under Ms. Valent’s interpretation, the Commissioner

may consider earnings when determining whether a

beneficiary remains disabled, but may not consider

work activity in making that determination. Nothing

in that interpretation prevents the Commissioner

from terminating benefits if a disability review

discloses earnings that rise to the level of substantial

gainful activity. 9 But the Commissioner may not

terminate the benefits of, or impose punitive

sanctions on, 24-month beneficiaries who, like Ms.

9 20 C.F.R. § 404.1574(b)(3)(iii). Earnings presuppose work as

an employee, but that does not mean that unpaid “work

activity” is a fact the Commissioner may consider “in evaluating

whether” a beneficiary remains “entitled to benefits.” 42 U.S.C.

§ 1320-8(a)(2). Contrary to the Sixth Circuit majority’s

erroneous assumption, this is not a case in which the

Commissioner penalized Ms. Valent for failing to report work

activity that generated earnings. See infra p. 33.

28

Valent, simply do volunteer work to improve their

“sense of self-worth.” App. 109.

Ms. Valent would prevail even under a more

limited version of Chevron. Under a rigorous

understanding of Chevron step one, the Sixth Circuit

“jumped the gun” in declaring the statute

ambiguous. Kisor, 139 S. Ct. at 2423–24 (remanding

case to Federal Circuit so the court can “seriously

think through” all the interpretative possibilities).

The Sixth Circuit “exhaust[ed] none of” the

interpretive “possibilities before ceding the judicial

role.” App. 26 (Kethledge, J., dissenting). A remand

would allow the Sixth Circuit to “make a

conscientious effort to determine, based on indicia

like text, structure, history, and purpose,” whether

the statute is indeed ambiguous. Kisor, 139 S. Ct. at

2424. “The canon against reading conflicts into

statutes” and “other traditional canons” would

counsel the Sixth Circuit to resolve the case in Ms.

Valent’s favor on remand. Epic Sys. Corp. v. Lewis,

138 S. Ct. 1612, 1630 (2018).

Review is also appropriate because the decision

below has important consequences in its own right.

Under the administrative construction upheld by the

Sixth and Second Circuits, see Cappetta, 904 F.3d at

168, nearly two million disability beneficiaries who

live in Connecticut, Kentucky, Michigan, New York,

Ohio, Tennessee, and Vermont are now subject to the

risk of ruinous penalties if they fail to disclose

unpaid volunteer work they perform for their

families and communities, even when they have

29

crippling life-long medical disabilities. 10 This will

only further discourage them from work, thwarting

the law Congress enacted in 1999.

II. The Court Should Clarify That Apparent

Statutory Conflict Is Not a License To

Defer.

The Court should grant certiorari to clarify that

Chevron is not a license for courts to abdicate their

duty to reconcile laws that “appear to conflict with

one another.” App. 8.

Resolving

statutory

conflicts—real

or

imagined—is a classic judicial function. As Chief

Justice Marshall put it, when “two laws conflict with

each other, the courts must decide on the operation

of each.” Marbury, 1 Cranch at 177. When they so

decide, courts are not filling gaps through policy

expertise; they are saying “what the law is.” Id. A

conflict between statutory provisions presents a

“pure question of statutory construction for the

courts to decide,” not a policy-laden ambiguity

eligible for Chevron deference. INS v. CardozaFonseca, 480 U.S. 421, 446 (1987).

The Court, however, has waffled on whether

courts may transfer this traditional judicial function

to executive agencies under Chevron. In Scialabba v.

Cuellar de Osorio, 537 U.S. 41 (2014), several

Justices suggested that Chevron does not apply to

unambiguous but conflicting provisions, but the

10 See Kaiser Family Foundation, Total Disabled Social Security

Disability Insurance Beneficiaries, Ages 18–64 (2017),

https://bit.ly/2MkuSeD.

30

Court did not resolve that issue. A plurality of the

Court in that case applied Chevron after concluding

that two “Janus-faced” clauses in a statutory

provision created an ambiguity that triggered

Chevron deference. Id. At 57. But six Justices

rejected this approach. The Chief Justice, joined by

Justice Scalia and (in relevant part) Justice Alito,

wrote a concurrence in which he argued that “[t]o the

extent the plurality’s opinion could be read to

suggest that deference is warranted because of a

direct conflict between these clauses, that is

wrong. . . . Direct conflict is not ambiguity, and the

resolution of such a conflict is not statutory

construction but legislative choice.” Id. At 76

(Roberts, C.J., concurring in judgment); see also id.

At 79 (Alito, J., dissenting) (agreeing that “[d]irect

conflict is not ambiguity”). Justice Sotomayor, joined

by Justices Breyer and Thomas, criticized the

plurality for “rushing to find a conflict with the

statute” and failing to apply traditional tools of

statutory construction. Id. At 82, 87 (Sotomayor, J,

dissenting).11

Confusion arising from the Court’s splintered

Scialabba decision is compounded by the fact that,

earlier in National Association of Home Builders v.

Defenders of Wildlife, the Court had deferred under

Chevron after finding that EPA could not

“simultaneously obey the differing mandates of

11 In

a footnote, Justice Sotomayor suggested that sometimes

conflict “can make deference appropriate to an agency’s decision

to override unambiguous statutory text.” Id. at 86 n.3

(Sotomayor, J., dissenting). Justice Thomas did not join that

footnote. Id. at 81.

31

[Endangered Species Act] § 7(a)(2) and [Clean Water

Act] § 402(b).” 551 U.S. 644, 647 (2007). Home

Builders, however, “did not address the consequences

of a single statutory provision that,” as in this case,

“appears to give divergent commands.” Scialabba,

573 U.S. at 76 n.1 (Roberts, C.J., concurring in

judgment). More importantly, Home Builders is in

conflict with this Court’s more recent holding that

“the reconciliation of distinct statutory regimes is ‘a

matter for the courts,’ not agencies.” Epic Sys. Corp.,

138 S. Ct. at 1629 (quoting Gordon v. N.Y. Stock

Exch. Inc., 422 U.S. 659, 685–86 (1975)).

Unsurprisingly, lower court judges have reached

differing conclusions on when, if ever, statutory

conflict creates ambiguity under Chevron.

On the one hand:



Several Federal Circuit judges have concluded

that the “interpretation of the interplay

between” two statutory provisions “seem[s] to

reside firmly within the expertise of Article III

courts” and is not eligible for Chevron

deference. Aqua Prod., Inc. v. Matal, 872 F.3d

1290, 1324 (Fed. Cir. 2017) (en banc) (opinion

of O’Malley, J., for five of eleven judges).

On the other hand:



The Second Circuit has held that “tension”

between two provisions renders a statute “as a

whole sufficiently ambiguous to oblige us to

give

Chevron

deference.”

Berman

v.

Neo@Ogilvy LLC, 801 F.3d 145, 155 (2d Cir.

2015), abrogated by Digital Realty Trust, Inc.

v. Somers, 138 S. Ct. 767, 782 (2018) (finding

the statute unambiguous).

32



The Third Circuit has deferred under Chevron

when two conflicting provisions could not be

“reconcile[d]” in a way that “Congress clearly

intended.” Cazun v. Attorney Gen. United

States, 856 F.3d 249, 259 (3d Cir. 2017). But

cf. id. At 266–67 (Hardiman, J., concurring in

judgment) (arguing that provisions were

unambiguous) (quoting Scialabba, 573 U.S. at

76 (Roberts, C.J., concurring in judgment)).



The Fourth Circuit has held that Chevron

deference is appropriate when “[t]he relevant

statutory sections appear to conflict with one

another.” King v. Burwell, 759 F.3d 358, 373

(4th Cir. 2014), aff’d on other grounds, 135 S.

Ct. 2480 (2015); see also aaiPharma Inc. v.

Thompson, 296 F.3d 227, 238 (4th Cir. 2002)

(same).



The Ninth Circuit has deferred under Chevron

when the “interplay” of two provisions

establishes “conflicting rules.” Perez-Guzman

v. Lynch, 835 F.3d 1066, 1074–77 (9th Cir.

2016); see also Alaska Wilderness League v.

Jewell, 788 F.3d 1212, 1220, 1223–24 (9th Cir.

2015) (same).



The Tenth Circuit has held that two

conflicting provisions make a statute

ambiguous under Chevron. Lorenzo v.

Mukasey, 508 F.3d 1278, 1283 (10th Cir. 2007).

And of course, the Sixth Circuit majority

deferred in this case because two clauses in § 421(m)

“appear to conflict with one another.” App. 8.

33

The Court should grant certiorari to resolve this

division of judicial opinion and clarify that Chevron

does not apply to the resolution of statutory conflicts.

“Courts are better equipped and more experienced

than agencies in answering” questions of statutory

conflict. Arangure, 911 F.3d at 342. Moreover,

conflicting provisions or statutes do not involve “[t]he

prototypical Chevron situation: an agency’s

application of law to fact,” using scientific or policy

expertise. Id. Instead, the resolution of statutory

conflicts involves pure questions of law that call for

traditional legal interpretation, not policy analysis.

Aqua Prod., Inc., 872 F.3d at 1324 (opinion of

O’Malley, J.).

Courts have plenty of tools at their disposal to

resolve apparent statutory conflicts on their own. For

example, when “there is a conflict between a general

provision and a specific provision, the specific

provision prevails.” Antonin Scalia & Bryan A.

Garner, Reading Law: The Interpretation of Legal

Texts 183 (2012). And if after applying all of the tools

of statutory construction, “a text contains truly

irreconcilable provisions at the same level of

generality, and they have been simultaneously

adopted, neither provision should be given effect.” Id.

At 189. “After all,” if one “cannot ‘make a valid choice

between two differing interpretations, . . . we are left

with the consequence that a text means nothing in

particular at all.’ ” Id. “Chevron is not a license for an

agency to repair a statute that does not make sense.”

Scialabba, 573 U.S. 76 (Roberts, C.J., concurring in

judgment). Picking one provision over another is

“legislative choice,” not interstitial gap-filling eligible

for Chevron. Id.

34

This case vividly illustrates the danger of

allowing agencies to resolve putative statutory

conflicts under Chevron. Instead of doing its job of

reconciling the statutory provisions, the Sixth Circuit

allowed the Commissioner to discard half of the

meaning of the term “disabled” in § 421(m), a term of

art repeatedly and consistently used through the Act.

App. 26–27 (Kethledge, J., dissenting) (citing 42

U.S.C. § 423(d)(1)). That is not legal interpretation.

That is allowing the Commissioner to “rewrite clear

statutory terms to suit [the Commissioner’s] own

sense of how the statute should operate.” Utility Air

Regulatory Grp. V. EPA, 573 U.S. 302, 328 (2014).

III. In the Alternative, the Court Should

Summarily Reverse To Correct the Sixth

Circuit’s Chenery Violation.

If the Court does not grant certiorari to overrule

or narrow Chevron, it should grant review to redress

the Sixth Circuit’s departure from the “foundational

principle of administrative law that a court may

uphold agency action only on the grounds that the

agency invoked when it took the action.” Michigan,

135 S. Ct. at 2710 (citing Chenery, 318 U.S. at 87).

The Sixth Circuit imagined that the

Commissioner had penalized Ms. Valent for failing to

report “work activity that generates earnings.” App. 8

(emphasis added). That was a clear violation of

Chenery, because the Commissioner’s order was

based simply on Ms. Valent’s failure to report work

activity, without regard to earnings. See App. 23–24.

As Judge Kethledge pointed out, the Sixth

Circuit’s assertion to the contrary is belied by the

record. App. 23–24. The court cited only one item to

35

support its assertion: “the IG’s June 3, 2013 letter to

Valent” threatening her with penalties and alleging

that she was paid “$400 per week.” App. 14. That

was an egregious error.

First, in a formal adjudication, the IG’s prehearing letter had no more weight than the

uncorroborated allegation of a prosecutor before

trial. It had no weight at all. See 5 U.S.C. § 556(d)

(“A sanction may not be imposed . . . except . . . in

accordance with reliable, probative, and substantial

evidence”).

Second, even if the IG’s letter had evidentiary

value, and it does not, it would not matter here. The

ALJ expressly found, after a formal hearing, that the

IG’s $400-per-week allegation was “unsupported by

the evidence.” App. 155. Indeed, the ALJ concluded

that the IG had failed to show “that [Ms. Valent]

received any compensation for her work activity.”

App. 156 (emphasis added). The Board deferred to

the ALJ’s assessment of the evidence and did not

disturb these findings, which are part of the

Commissioner’s final decision. See App. 69–73 &

n.11.

Moreover, even if the record supported an

assertion that Ms. Valent was paid, and it does not,

it would not matter here. At the end of the day, as

Judge Kethledge noted, the Commissioner’s “stated

basis for imposing the sanction was solely her work

activity”; the sanction was not based on “any

earnings” that she might have received from that

36

activity, App. 23 (emphasis added). 12 The

Commissioner’s counsel candidly conceded the point:

COURT: As I understand the record here, the

Commissioner sought this penalty and

repayment of benefits solely on the ground of

her failure to disclose work activity, not

substantial gainful [activity] or earnings.

GOVERNMENT: That’s correct.

App. 24 (Kethledge, J., dissenting) (citing Oral Arg.

at 28:02). Yet the court of appeals asserted that the

Commissioner penalized Ms. Valent for withholding

not just work, but “work that generates earnings.”

App. 8. The Court’s error was dispositive. App. 15.

That is not how administrative law is supposed

to work. Courts do not get to fix agency decisions

based on any alternative rationale they can conceive.

In doing so here, the court of appeals failed to uphold

the principle “that a court may uphold agency action

only on the grounds that the agency invoked when it

took the action.” Michigan, 135 S. Ct. at 2710 (citing

Chenery, 318 U.S. at 87). Summary reversal is

warranted on this ground alone. See Thomas, 547

U.S. at 186 (summarily reversing decision ignoring

12 See also App. 59 n.8 (Board) (noting that the agency imposed

the sanction “based on failure to report work activity, not on

failure to report earnings or substantial gainful activity”);

App. 88–89 (ALJ) (“The June 3, 2013 IG notice did not charge

Respondent with failure to report earnings or failure to report

substantial gainful activity.”); App. 150 (ALJ) (“The SSA IG

does not propose to impose a [civil monetary penalty] and

assessment against Respondent based on failure to report

earnings from work activity or substantial gainful activity.”).

37

Chenery); INS v. Ventura, 537 U.S. 12, 14, 16 (2002)

(per curiam) (same).

CONCLUSION

The petition for certiorari should be granted.

Respectfully submitted,

C. BOYDEN GRAY

ADAM R.F. GUSTAFSON

Counsel of Record

JAMES R. CONDE

BOYDEN GRAY & ASSOCIATES

801 17th St NW, #350

Washington, DC 20006

(202) 955-0620

gustafson@boydengray

associates.com

Counsel for Petitioner

August 16, 2019