Amicus Curiae Brief — Howard L. Baldwin, et ux., Petitioners v. United States

No. 19-402

In the Supreme Court of the United States

__________

HOWARD L. BALDWIN AND KAREN E. BALDWIN,

A MARRIED COUPLE,

PETITIONERS,

V.

UNITED STATES OF AMERICA,

RESPONDENT.

__________

On Petition for Writ of Certiorari

to the United States Court of Appeals

for the Ninth Circuit

__________

BRIEF OF THE CATO INSTITUTE AND

NFIB SMALL BUSINESS LEGAL CENTER AS

AMICI CURIAE SUPPORTING PETITIONERS

__________

Karen R. Harned

Luke Wake

NFIB SMALL BUSINESS

LEGAL CENTER

1201 F St., NW

Suite 200

Washington, DC 20004

(202) 314-2048

October 25, 2019

Ilya Shapiro

Counsel of Record

CATO INSTITUTE

1000 Mass. Ave., NW

Washington, DC 20001

(202) 842-0200

ishapiro@cato.org

i

QUESTIONS PRESENTED

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

Servs. held that an agency’s “permissible reading” of a

statute trumps circuit-court precedent if the prior

court had interpreted a statute that was silent or ambiguous with respect to the specific issue. 545 U.S. 967,

984 (2005). In all other situations, stare decisis dictates that circuit panel opinions can be overruled only

by en banc courts of appeals, this Court, or a properly

enacted statute.

The Ninth Circuit here, following Brand X, deferred

to the Internal Revenue Service’s interpretation of 26

U.S.C. § 7502 and held that its own prior construction

of the statute did not bar the IRS’s subsequent contrary construction of that section because the statute

was “silent” as to the specific legal issue. App.11a. The

court’s precedent, established in 1992, had upheld the

common-law mailbox rule. Nearly 20 years later, the

IRS issued its contrary interpretation, which not only

overruled court precedent but also abrogated a common-law rule that has prevailed for hundreds of years.

Absent Brand X, Ninth Circuit precedent, based on

ordinary tools of statutory construction, would have

controlled. Consequently, Howard and Karen Baldwin, who prevailed in district court, would have obtained a tax refund of about $168,000, plus statutory

interest and attorneys’ fees. Accordingly, the Baldwins

present the following questions:

(1) Should Brand X be overruled?

(2) What, if any, deference should a federal agency’s

statutory construction receive when it contradicts a

court’s precedent and disregards traditional tools of

statutory interpretation?

ii

TABLE OF CONTENTS

Page

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

TABLE OF AUTHORITIES ....................................... iii

INTEREST OF AMICI CURIAE ................................. 1

SUMMARY OF ARGUMENT ..................................... 2

ARGUMENT ................................................................ 4

I. The Court Should Decide Whether an Agency Can

Regulate the Judiciary with a Perfunctory FivePage Rulemaking ................................................... 4

II. The Court Should Review Whether the IRS’s

Perfunctory Rulemaking Implicates Agency

Expertise and Thus Chevron Deference .............. 11

CONCLUSION .......................................................... 14

iii

TABLE OF AUTHORITIES

Page(s)

Cases

Anderson v. United States,

966 F.2d 487 (9th Cir. 1992) .............................. 7, 10

Baldwin v. United States,

921 F.3d 836 (9th Cir. 2019) ........................ 3, 10, 12

Barnhart v. Walton, 535 U.S. 212 (2002).................. 12

Carroll v. Comm’r,

71 F.3d 1228 (6th Cir. 1995) ............................ 5, 6, 8

Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc.,

467 U.S. 837 (1984) .............................................. 3, 9

City of Arlington v. FCC, 569 U.S. 290 (2013) ......... 13

Crude Oil Corp. v. Comm’r,

161 F.2d 809 (10th Cir. 1947) .................................. 6

Deutsch v. Comm’r, 599 F.2d 44 (2d Cir. 1979) .......... 7

Drake v. Comm’r, 554 F.2d 736 (5th Cir. 1977) .......... 8

Estate of Wood v. Comm’r,

909 F.2d 1155 (8th Cir. 1990) .................................. 7

Gutierrez-Brizuela v. Lynch,

834 F.3d 1142 (10th Cir. 2016) .............................. 11

Henderson v. Shinseki, 562 U.S. 428 (2011) ............. 13

INS v. Cardoza-Fonseca, 480 U.S. 421 (1987) .......... 12

King v. Burwell, 135 S. Ct. 2480 (2015) .................... 13

Kisor v. Wilkie, 139 S. Ct. 2400 (2019).......... 11, 12, 13

Marbury v. Madison, 5 U.S. 137 (1803) .................... 12

iv

Martin v. Occupational Safety & Health Review

Comm’n, 499 U.S. 144 (1991) ................................ 11

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

Internet Servs., 545 U.S. 967 (2005) .................. 3, 10

Norfolk Redevelopment & Housing Auth. v.

Chesapeake & Potomac Tel. Co.,

464 U.S. 30 (1983) .................................................... 7

Pauley v. BethEnergy Mines, Inc.,

501 U.S. 680 (1991) ................................................ 11

Pereira v. Sessions, 138 S. Ct. 2105 (2018) ................. 9

Perez v. Mortg. Bankers Ass'n,

135 S. Ct. 1199 (2015) .............................................. 8

Phila. Marine Trade Ass’n v. Comm’r,

523 F.3d 140 (3d Cir. 2008) ................................. 2, 7

Rich v. Comm’r, 250 F.2d 170 (5th Cir. 1957) ........ 5, 8

Smiley v. Citibank (South Dakota), N.A.,

517 U.S. 735 (1996) ................................................ 11

Sorrentino v. Comm’r,

383 F.3d 1187 (10th Cir. 2004) ................................ 7

U.S. v. Kwai Fun Wong, 135 S. Ct. 1625 (2015) ......... 5

Young v. Community Nutrition Inst.,

476 U.S. 974 (1986) .................................................. 3

Statutes

26 U.S.C. § 6511(a) ...................................................... 5

26 U.S.C. § 6511(b)(1) .................................................. 5

26 U.S.C. § 6511(d)(2)(A) ............................................. 5

26 U.S.C. § 7422(a) ...................................................... 5

v

Other Authorities

26 C.F.R. § 301.7502-1(g)(4) ........................................ 8

Christopher J. Walker & Kent Barnett,

Chevron in the Circuit Courts,

116 Mich. L. Rev. 1 (2017) ..................................... 10

Jorge Fitz-Gibbon, U.S. Postal Service Probes

Somers Postal Worker over Dumped Mail,

Rockland Journal News, Oct. 20, 2018 ................... 4

Kimberly C. Metzger, Interpretation of the Section

7502 Timely-Mailing, Timely-Filing

Requirements: Carroll v. Commissioner and the

Liberal/Conservative Interpretation Dilemma,

28 U. Tol. L. Rev. 767 (1997) ................................... 9

Timely Mailing Treated as Timely Filing,

69 Fed. Reg. 56,377 (Sept. 21, 2004) ............. passim

Timely Mailing Treated as Timely Filing,

76 Fed. Reg. 52,561 (Aug. 23, 2011) .............. passim

Treasury Inspector General for Tax Administration,

Interim Results of the 2019 Filing Season 5

(Apr. 2, 2019) ............................................................ 4

1

INTEREST OF AMICI CURIAE1

The Cato Institute is a nonpartisan public-policy

research foundation established in 1977 and dedicated

to advancing the principles of individual liberty, free

markets, and limited government. Cato’s Robert A.

Levy Center for Constitutional Studies was established in 1989 to help restore the principles of limited

constitutional government that are the foundation of

liberty. Toward those ends, Cato publishes books and

studies, conducts conferences, and produces the annual Cato Supreme Court Review.

The National Federation of Independent Business

(NFIB) Small Business Legal Center is a nonprofit,

public-interest law firm established to provide legal

representation and be the voice for small businesses in

the nation’s courts. NFIB 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.

This case interests amici because it concerns the

proper delineation of the separation of powers. If the

judicial branch is to “say what the law is” and the executive branch is to enforce law rather than make it,

then this Court must clarify whether and how much

deference judges should give to administrative agencies’ purported overrulings of previous court rulings.

1 Rule 37 statement:

All parties were timely notified and consented to the filing of this brief. No part of this brief was authored

by any party’s counsel, and no person or entity other than amici

funded its preparation or submission.

2

SUMMARY OF ARGUMENT

By invoking deference doctrines, the IRS is trying

to accomplish in a barebones rulemaking what it failed

to win in multiple courts with hundreds of pages of

briefing. Unless this Court steps in, other executive

agencies are sure to follow this template for overcoming judicial precedent by “earning” the Chevron framework with an empty notice-and-comment process.

At issue is whether 26 U.S.C. § 7502 stops courts

from employing a common-law evidentiary principle,

known as the mailbox rule, in delineating the boundaries of the federal judiciary’s subject-matter jurisdiction to hear taxpayer-refund suits. While the tax code

does not speak to this question, the IRS long has interpreted the statute’s silence as foreclosing the mailbox

rule. Some courts agreed; others didn’t. See Phila. Marine Trade Ass’n v. Comm’r, 523 F.3d 140, 148-52 (3d

Cir. 2008) (describing lower-court split).

After decades of litigating the mailbox rule with

mixed success, the IRS switched gears and tried an administrative shortcut. In a bid to have the judiciary defer to the agency interpretation, the IRS issued a fivepage rulemaking to “clarify” that the statute meant

what the IRS had argued. See Timely Mailing Treated

as Timely Filing, 69 Fed. Reg. 56,377 (Sept. 21, 2004)

(proposed rule); Timely Mailing Treated as Timely Filing, 76 Fed. Reg. 52,561 (Aug. 23, 2011) (final rule).

On its own terms, the “clarifying” rule fails to implicate agency expertise: it purports to deny courts access to a common-law principle developed by federal

judges to police their own jurisdiction. Simply put, the

agency’s rule regulates the craft of judging, which is

obviously outside of the IRS’s bailiwick.

3

The IRS’s lack of expertise explains why the

agency’s rulemaking said so little—because there was

so little to say. Across the proposed and final rules, the

agency provided a paltry nine paragraphs of conclusory reasoning. Compare 69 Fed. Reg. at 56,378 (Sept.

21, 2004) (giving two paragraphs to section titled “Explanation of Provisions) with 76 Fed. Reg. at 52,561–

62 (Aug. 23, 2011) (spending seven paragraphs in final

rule on section titled “Summary of Comments and Explanation of Provisions”).

Having jumped through the minimum procedural

hoops, the agency then felt entitled to the Chevron

framework. The Ninth Circuit agreed. In the decision

below, a three-judge panel applied an utterly cursory

Chevron methodology, including its Brand X corollary,

and thereby swept aside the circuit’s precedential

holding that the best reading of the tax code allows

taxpayers to benefit from the mailbox rule. See Baldwin v. United States, 921 F.3d 836, 842–43 (9th Cir.

2019); see also Nat’l Cable & Telecomms. Ass’n v.

Brand X Internet Servs., 545 U.S. 967 (2005) (extending Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc.,

467 U.S. 837 (1984), such that it overcomes an Article

III court’s precedential statutory interpretation).

This Court cannot allow the decision below to escape further review, and not simply because the lower

court “employs a reasoning so formulaic that it trivializes the art of judging.” Young v. Community Nutrition

Inst., 476 U.S. 974, 988 (1986) (Stevens, J., dissenting).

If Baldwin stands and the IRS is permitted to wave

away 50 years of adverse court decisions with a handful of pages in the Federal Register, then the Court’s

inaction would occasion a disconcerting disruption of

4

the constitutional balance between the separated powers. With the path blazed here, other agencies will become emboldened to aggrandize their power at the

hands of the judiciary. The route is clear: all agencies

must do is undergo a sham notice-and-comment processes to serve as an invitation to judicial deference.

Only this Court is constitutionally empowered to

resolve a circuit split over a purely legal question such

as this one. Ultimately, the IRS may prevail through

persuasion, but the final decision must come from the

judiciary. It simply can’t be that the IRS possesses an

implied statutory authority to regulate federal courts’

usage of a judge-made concept. Even if this hidden

power does exist—and it doesn’t—it can’t be permissibly invoked merely because the agency checked the

requisite boxes for “earning” deference.

ARGUMENT

I. The Court Should Decide Whether an Agency

Can Regulate the Judiciary with a Perfunctory Five-Page Rulemaking

Every year, taxpayers rely on the Postal Service to

send millions of documents to the IRS. See Treasury

Inspector General for Tax Administration, Interim Results of the 2019 Filing Season 5 (Apr. 2, 2019) (forecasting receipt of about 16 million paper individual tax

returns in 2019). And every year, some documents get

lost in the shuffle.

Of course, the Postal Service is comprised of fallible

humans who make mistakes. See, e.g., Jorge Fitz-Gibbon, U.S. Postal Service Probes Somers Postal Worker

over Dumped Mail, Rockland Journal News, Oct. 20,

2018, https://bit.ly/32za48j (reporting on investigation

5

regarding “several boxes of mail [that] were found

dumped in local woods”). The IRS, like the Postal Service, is a government entity composed of imperfect humans who sometimes mishandle documents. See, e.g.,

Carroll v. Comm’r, 71 F.3d 1228, 1230 (6th Cir. 1995)

(“When asked at the hearing if [tax documents] are

ever lost at the service center, a representative of the

IRS responded with an unqualified ‘yes.’”).

No matter how innocuous in intent, these inescapable human errors can cause real harm to taxpayers

trying to recover property (overpayments) from the

government. When documents get lost, taxpayers miss

filing deadlines that implicate the IRS’s statutory

waiver of sovereign immunity for refund suits. Compare 26 U.S.C. § 7422(a) (requiring all suits “for the

recovery of any internal revenue tax . . . erroneously or

illegally . . . collected” to have been preceded by a “duly

filed” refund claim) with 26 U.S.C. §§ 6511(a), (b)(1),

(d)(2)(A) (establishing a three-year limitations period

and applicable extensions for duly “filed” overpayment

claims). A missed deadline may thus deprive taxpayers of their “day in court,” even though fault lay entirely with a government bureaucracy. Rich v. Comm’r,

250 F.2d 170, 177 (5th Cir. 1957) (Brown, J., dissenting). But see U.S. v. Kwai Fun Wong, 135 S. Ct. 1625,

1643 (2015) (Alito, J., dissenting) (“[I]n recent years,

we have grown reluctant to affix the ‘jurisdictional’ label [to statutory filing deadlines].”).

The tax code never has accounted for this unfairness, which has existed ever since Congress began taxing income. Faced with these unavoidable inequities,

courts long ago turned to a common-law evidentiary

principle. Under the “mailbox rule,” proof of proper

mailing gives rise to a rebuttable presumption that the

6

document was physically delivered to the addressee in

the time such a mailing would ordinarily take to arrive. Accord Crude Oil Corp. v. Comm’r, 161 F.2d 809,

810 (10th Cir. 1947) (“When mail matter is properly

addressed and deposited in the United States mails,

with postage duly prepaid thereon, there is a rebuttable presumption of fact that it was received by the addressee in the ordinary course of mail.”).

In 1954, as federal courts were developing the mailbox rule, Congress added 26 U.S.C. § 7502 to the tax

code, to better protect taxpayers from the vagaries of

postal delivery and IRS handling. Under § 7502(a),

documents are considered “delivered” by the Postal

Service (and thus “filed” with the IRS) on the date of

the envelope’s postmark. In addition, § 7502(c) allows

taxpayers to use a receipt for registered mail to establish prima facie evidence that a tax document was “delivered” upon mailing. Crucially, however, § 7502 does

not address the federal judiciary’s common-law mailbox rule as it applies to regular mail, which is how

most taxpayers send their documents.

Faced with this statutory silence, circuit courts

have split on the continued viability of the judge-made

mailbox rule after the 1954 tax amendments.

On one hand, the Second and Sixth Circuits reasoned that Congress specified the only available exceptions to timely physical delivery of tax documents,

foreclosing the mailbox rule’s evidentiary standard for

regular mail. See Carroll, 71 F.3d at 1232 (“the only

exceptions to the physical delivery rule . . . are the two

set out in section 7502”); Deutsch v. Comm’r, 599 F.2d

7

44, 46 (2d Cir. 1979) (rejecting extrinsic proof of mailing because § 7502 evidences Congress’s “penchant for

an easily applied, objective standard”).

On the other hand, the Third, Eighth, Ninth, and

Tenth Circuits determined that § 7502 complements,

rather than supplants, the mailbox rule. See Phila.

Marine Trade Ass’n v. Comm’r, 523 F.3d at 141 (3d Cir.

2008); Sorrentino v. Comm’r, 383 F.3d 1187, 1194

(10th Cir. 2004); Anderson v. U.S., 966 F.2d 487, 491

(9th Cir. 1992); Estate of Wood v. Comm’r, 909 F.2d

1155 (8th Cir. 1990). As a matter of statutory interpretation, these courts understood that “Section 7502’s silence . . . is insufficient to entirely supplant the mailbox rule because ‘it is a well-established principle of

statutory construction that the common law ought not

to be deemed to be repealed, unless the language of the

statute be clear and specific for this purpose.’” Sorrentino, 383 F.3d at 1193–94 (quoting Norfolk Redevelopment & Housing Auth. v. Chesapeake & Potomac Tel.

Co., 464 U.S. 30, 35 (1983)). See also Phila. Marine

Trade Ass’n, 523 F.3d at 149 (quoting same language);

Anderson, 966 F.2d at 491 (“[A]bsent a clear manifestation of contrary intent, a newly-enacted statute is

presumed to be harmonious with existing law and its

judicial construction.”); Estate of Wood, 909 F.2d at

1160 (abiding “[t]he normal rule of statutory construction . . . that if Congress intends for legislation to

change the interpretation of a judicially created concept, it makes that intent specific”).

In this latter view, Congress intended § 7502 to operate as a taxpayer “safe harbor” from harsh inequities

engendered whenever the IRS or Postal Service misplaces or mishandles a tax document. See Sorrentino,

383 F.3d at 1192; Estate of Wood, 909 F. 2d at 1161.

8

While courts have split, the IRS steadfastly maintained an unforgiving interpretation of the tax code.

No matter how grossly the inequities stack up against

the taxpayer, the IRS invariably has argued that

courts may not consider extrinsic evidence to establish

timely mailing through regular mail. In Carroll, for example, the IRS argued against the court’s subject matter jurisdiction, even after conceding both that the taxpayer document was mailed months before the deadline and that an arm of the government was culpable.

See 71 F.3d at 1230; see also Drake v. Comm’r, 554 F.2d

736, 737–39 (5th Cir. 1977) (agreeing that courts lack

jurisdiction despite IRS stipulation that Postal Service

was entirely to blame for taxpayer’s untimely filing);

Rich, 250 F.2d at 173 (siding with the IRS in denying

jurisdiction for untimely filing even though “[a]ll of the

equities are with the appellant”).

After waging this legal battle for a half-century

with only mixed success, the IRS tried a different tack

for prevailing upon federal courts the agency’s preferred construction of the tax code. In 2004, it commenced a rulemaking that purported to resolve the circuit split simply by “clarifying” that § 7502 supplants

the mailbox rule. See 69 Fed. Reg. at 56,378. The 2004

proposal took retroactive effect upon promulgation of

the final rule seven years later. See 26 C.F.R. §

301.7502-1(g)(4) (backdating the rule’s effect to 2004).2

2 Because the Baldwins mailed their tax documents before the

IRS promulgated the final rule, the petitioners are subject to the

regulation only by virtue of its retroactive effect. Yet federal agencies are only entitled to the benefits of Chevron deference once

they have completed the notice-and-comment process. Perez v.

Mortg. Bankers Ass'n, 135 S. Ct. 1199, 1204 (2015) (emphasizing

that only these rules “have the force and effect of law”).

9

Importantly, the IRS’s new rule didn’t govern the

agency, but instead regulated the courts’ access to an

evidentiary canon (the common-law mailbox rule).

During the 50 years leading up to the proposed new

rule, thousands of pages of briefing informed hundreds

of pages of jurisprudence across scores of cases, and all

of it was borne of careful deliberation over the mailbox

rule. See generally Kimberly C. Metzger, Interpretation of the Section 7502 Timely-Mailing, Timely-Filing

Requirements: Carroll v. Commissioner and the Liberal/Conservative Interpretation Dilemma, 28 U. Tol.

L. Rev. 767 (1997) (analyzing the mailbox rule’s legal

history). In stark contrast, the entire IRS rulemaking

to overturn the mailbox rule occupied barely five pages

in the Federal Register. Regarding the circuit split—

the agency’s avowed impetus for its rule—the IRS allotted exactly two sentences, which were reproduced

nearly word-for-word in the proposed and final rules.

Compare 69 Fed Reg. at 56,378 with 76 Fed. Reg. at

52,561. Instead of genuine public engagement, the

purpose of the rulemaking seemed to be the achievement of the bare minimum administrative process necessary to “earn” Chevron deference.

Having jumped through those procedural hoops,

the IRS argued for binding judicial respect. In siding

with the IRS, the court below employed “the type of

reflexive deference” that “trouble[s]” members of this

Court. Pereira v. Sessions, 138 S. Ct. 2105, 2120 (2018)

(Kennedy, J., concurring).

As a practical matter, the “trouble” emanates from

the Ninth Circuit’s cursory application of the famous

Chevron framework. See Chevron, 467 U.S. at 842–43

(1984). At Step One’s investigation into textual clarity,

10

the panel performed a brief and circular analysis. See

Baldwin v. United States, 921 F.3d 836, 842 (9th Cir.

2019) (reasoning that Ҥ 7502 is silent as to whether

the statute displaces the common-law mailbox rule”

because “the statute does not address” it). At Step

Two’s “reasonableness” query, the panel readily upheld the IRS interpretation, as is too typical. Id. at 843.

See also Christopher J. Walker & Kent Barnett, Chevron in the Circuit Courts, 116 Mich. L. Rev. 1, 6 (2017)

(finding that agencies win in 93.8% of cases at Chevron

Step Two in circuit courts).

Again, the Ninth Circuit was among the courts in

the circuit split that ruled against the IRS regarding

the mailbox rule’s availability. See Anderson, 966 F.2d

at 491. In the normal course, circuit precedent can be

changed exclusively by a ruling of this Court, a statute

passed by Congress, or an en banc hearing. Here, however, deference doctrines did all the work. To overcome

its precedent, the Ninth Circuit panel turned to the

Brand X principle that “[a] court’s prior judicial construction of a statute trumps an agency construction

otherwise entitled to Chevron deference only if the

prior court decision holds that its construction follows

from the unambiguous terms of the statute and thus

leaves no room for agency discretion.” Baldwin, 921

F.3d at 843 (citing Brand X, 545 U.S. at 982).

Because the Ninth Circuit’s previous reading of §

7502 was merely its best exposition and not “the only

reasonable interpretation,” the agency was free to disagree, and the court felt it must yield. Id. “Quite literally then, after [the Ninth Circuit] declared the statute[‘s] meaning and issued a final decision, an executive agency was permitted to (and did) tell [the court]

to reverse [its] decision like some sort of super court of

11

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

1150 (10th Cir. 2016) (Gorsuch, J., concurring).

II. The Court Should Review Whether the IRS’s

Perfunctory Rulemaking Implicates Agency

Expertise and Thus Chevron Deference

Chevron deference “reflects a sensitivity to the

proper roles of the political and judicial branches.”

Pauley v. BethEnergy Mines, Inc., 501 U.S. 680, 696

(1991). Because “the resolution of ambiguity in a statutory text is often more a question of policy than of

law,” id., this Court assumes that Congress intends for

agencies, and not judges, to make these sorts of policy

decisions. Smiley v. Citibank (South Dakota), N.A.,

517 U.S. 735, 740–41 (1996) (describing Chevron as a

“presumption that Congress, when it left ambiguity in

a statute meant for implementation by an agency, understood that the ambiguity would be resolved, first

and foremost, by the agency”). This presumption rests

on the agency’s “historical familiarity and policymaking expertise” with respect to its enabling statutes.

Martin v. Occupational Safety & Health Review

Comm’n, 499 U.S. 144, 153 (1991).

Still, not all statutory ambiguities are amenable to

the Chevron framework. “Some interpretive issues

may fall more naturally into a judge’s bailiwick.” Kisor

v. Wilkie, 139 S. Ct. 2400, 2417 (2019) (citing, as an

example, “elucidation of a simple common-law property term”). Where “the agency has no comparative expertise,” it follows that “Congress presumably would

not grant it [interstitial lawmaking] authority,” and

deference becomes inappropriate. Id. For these sorts of

questions, which exist outside an agency’s competence,

12

it is incumbent on courts “to say what the law is.” Marbury v. Madison, 5 U.S. 137, 177 (1803).

Discerning which branch—agencies or courts—gets

interpretive primacy is a context-driven inquiry that

depends on “the interstitial nature of the legal question” immediately at hand. Barnhart v. Walton, 535

U.S. 212, 222 (2002). In performing this case-by-case

analysis, courts look foremost to whether the interpretive question “in some way implicate[s]” the agency’s

“substantive expertise.” Kisor, 139 S. Ct. at 2417.

For some highly technical interpretations, administrative agencies are obviously more expert compared

to courts. See, e.g., id. at 2413 (discussing “moiety”).

Yet other interpretative questions, such as § 7502’s relationship to the mailbox rule, are obviously suited for

judiciary. See INS v. Cardoza-Fonseca, 480 U.S. 421,

446 (1987) (discussing “pure question[s] of statutory

construction for the courts to decide”). The mailboxrule controversy, after all, centers on a judge-made evidentiary principle as it pertains to Article III jurisdiction. It is hard to imagine a more quintessentially judicial matter than the legal question at issue here.

Turning to the statute, there is no textual evidence

that § 7502 carries an implied delegation for the IRS

to regulate the judiciary by forbidding resort to the

mailbox rule. Because the statute is “silent” on the

matter, any such delegation would have to be read into

existence. See Baldwin, 921 F.3d at 842 (“[W]e conclude that . . . § 7502 is silent as to whether the statute

displaces the common-law mailbox rule.”). But it’s inconceivable that Congress would bestow such a power

on the IRS without a word, given the background prin-

13

ciple that federal courts maintain an “independent obligation” under the Constitution to police their own jurisdiction. Henderson v. Shinseki, 562 U.S. 428, 434

(2011). Cf. King v. Burwell, 135 S. Ct. 2480, 2489

(2015) (“[H]ad Congress wished to assign that question

to an agency, it surely would have done so expressly.”).

Remarkably, the IRS conceded that its statutory

interpretation involves matters wholly outside its purview. During its halfhearted rulemaking to “clarify” §

7502, the agency disavowed any authority to adopt the

common-law mailbox rule for regular mail. See 76 Fed.

Reg. 52,561, 52,562 (Aug. 23, 2011) (“[W]ithout legislative action . . . the IRS cannot adopt regulations extending prima facie evidence of delivery [to regular

mail].”). The rulemaking’s only purpose was thus to

deny courts access to the mailbox rule. So on the IRS’s

own terms, “the subject matter of the relevant provision” is “distan[t] from the agency’s ordinary statutory

duties [and falls] within the scope of another [institution’s] authority.” City of Arlington v. FCC, 569 U.S.

290, 309 (2013) (Breyer, J., concurring in judgment).

The IRS’s perfunctory rulemaking, moreover,

failed to demonstrate “an agency’s authoritative, expertise-based, fair or considered judgment,” which is

another tell-tale sign that deference is unwarranted.

Kisor, 139 S. Ct. at 2414 (cleaned up). In the entire

rulemaking, the IRS offered a paltry nine paragraphs

of explanation. According to the IRS, its rule was precipitated by a circuit split over the mailbox rule. And

yet, other than identifying the split, the rulemaking

did not discuss the differences of opinion.

Far from exhibiting expertise, the IRS’s rulemaking failed to demonstrate any signs of deliberation at

14

all. Instead, the agency simply announced a circuit

split and then claimed to resolve it with a conclusory

interpretation. The IRS vacuously reasoned that “[t]he

regulations are necessary to provide greater certainty

on this issue and to provide specific guidance,” without

further elaboration. 69 Fed. Reg. at 56,378. Elsewhere,

and with equal opacity, the IRS explained that its rule

“merely clarif[ies] and confirm[s] current IRS practice

under the existing regulations.” Id. Nowhere did the

agency discuss why it is trying to eliminate the mailbox rule. Is the new rule meant to engender administrative efficiencies? We don’t know. Was the IRS motivated by revenue concerns? The regulation doesn’t say.

Such a transparently superficial exercise should not be

rewarded with Chevron deference.

CONCLUSION

The Court cannot allow the decision below to stand

without further review, and not simply because the

lower court evinces a too-sanguine application of deference doctrines. There is more at stake here than poor

judicial methodology. Agencies cannot be allowed to

overcome adverse judicial rulings merely by going

through the motions of a Chevron-begging rulemaking.

Respectfully submitted,

Karen R. Harned

Luke Wake

NFIB SMALL BUSINESS

LEGAL CENTER

1201 F St., NW, Suite 200

Washington, DC 20004

October 25, 2019

Ilya Shapiro

Counsel of Record

CATO INSTITUTE

1000 Mass. Ave., NW

Washington, DC 20001

(202) 842-0200

ishapiro@cato.org