Amicus Curiae Brief — Alexandru Bittner, Petitioner v. United States

No. 21-1195

In The

Supreme Court of the United States

---------------♦-------------ALEXANDRU BITTNER, PETITIONER

v.

UNITED STATES OF AMERICA

---------------♦-------------ON WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE FIFTH CIRCUIT

---------------♦-------------Brief of Amici Curiae National Federation of

Independent Business Small Business Legal

Center, National Association of Home Builders

of the United States, American Farm Bureau

Federation, Restaurant Law Center, and Corn

Refiners Association, In Support of Petitioner

---------------♦-------------Of Counsel:

Arthur G. Sapper, Esq.

Counsel of Record

Elizabeth Milito, Esq.

OGLETREE, DEAKINS, NASH,

Senior Executive

SMOAK & STEWART, P.C.

Counsel

Ste 1000, 1909 K Street NW

NFIB Small Business

Washington, D.C. 20006

Legal Center, Ste. 1000 Tel. 202-263-0270

555 12th St. NW

Arthur.Sapper@ogletree.com

Washington, D.C. 20004 Counsel for Amici Curiae

(Additional counsel listed on inside cover)

Additional counsel for amici curiae

Of Counsel:

Of Counsel:

Ellen Steen, Esq.

Travis Cushman, Esq.

American Farm Bureau

Federation

Ste. 1000W

600 Maryland Ave. SW

Washington, D.C. 20024

Angelo I. Amador, Esq.

Restaurant Law Center

Ste. 700, 2055 L St. NW

Washington, D.C. 20036

Thomas Ward, Esq.

National Association of

Home Builders

1201 15th Street NW

Washington, DC 20005

John W. Bode, Esq.,

Corn Refiners Association

Ste. 400, 1701 Pennsylvania

Ave. NW

Washington, D.C. 20006

i

TABLE OF CONTENTS

Page

Interests of the Amici Curiae......................................1

Summary of Argument................................................4

Argument .....................................................................7

I.

A rule of lenity should be applied if a civil

penalty can be imposed. ...................................7

II. Regardless of whether lenity applies when a

civil penalty can be imposed, lenity should

apply when construing the particular

statutory provision that imposes a civil

penalty or provides a unit of violation. .......... 10

III. Regulations may not be considered in

determining the unit of violation of a statute

except to avoid misleading the public. ........... 14

Conclusion ................................................................. 19

ii

TABLE OF AUTHORITIES

Page(s)

Federal Cases

Bifulco v. United States,

447 U.S. 381 (1980) .............................................. 10

Comm’r v. Acker,

361 U.S. 87 (1959) ...................................... 5, 11, 12

Dayton Tire,

23 BNA OSHC 1247 (OSHRC 2010),

rev’d on other grounds, 671 F.3d 1249

(D.C. Cir. 2012) .................................................... 13

Diamond Roofing Co. v. OSHRC,

528 F.2d 645 (5th Cir. 1976) .................................. 9

Dravo Corp. v. OSHRC,

613 F.2d 1227 (3d Cir. 1980) ................................. 9

Duncan v. Louisiana,

391 U.S. 145 (1968) .............................................. 17

Dunn v. United States,

442 U.S. 100 (1979) ................................................ 7

E. Smalis Painting Co.,

22 BNA OSHC 1553 (OSHRC 2009) ................... 13

Elliott v. R.R.,

99 U.S. 573 (1878) ................................................ 11

iii

Erik K. Ho,

20 BNA OSHC 1361 (OSHRC 2003),

aff’d sub nom. Chao v. OSHRC, 401 F.3d

355 (5th Cir. 2005) ......................................... 13, 15

FCC v. Fox Television Stations, Inc.,

567 U.S. 239 (2012) ................................................ 7

First Nat’l Bank of Gordon v. Dep’t of the Treasury,

911 F.2d 57 (8th Cir. 1990) .................................... 9

Fisher v. Metro. Life Ins. Co.,

895 F.2d 1073 (5th Cir. 1990) .............................. 12

Gen. Elec. Co. v. EPA,

53 F.3d 1324 (D.C. Cir. 1995) .............................. 19

Gen. Motors Corp.,

22 BNA OSHC 1019 (OSHRC 2007) ................... 13

Gold Kist, Inc. v. Dep’t of Agric.,

741 F.2d 344 (11th Cir. 1984) .............................. 12

Gutierrez-Brizuela v. Lynch,

834 F.3d 1142 (10th Cir. 2016) ............................ 17

Haberern v. Kaupp Vascular Surgeons Pens. Plan,

24 F.3d 1491 (3d Cir. 1994), cert. denied,

513 U.S. 1149 (1995) ............................................ 12

Indus. Union Dep’t. v. Amer. Petrol. Inst.,

448 U.S. 607 (1980) .............................................. 17

Karlen v. Jones Lang LaSalle Americas, Inc.,

766 F.3d 863 (8th Cir. 2014) ................................ 12

iv

Keppel v. Tiffin Sav. Bank,

197 U.S. 356 (1905) .............................................. 11

Kropp Forge Co. v. Sec’y of Labor,

657 F.2d 119 (7th Cir. 1981) .................................. 9

Lucia v. SEC,

138 S.Ct. 2044 (2018) ............................................. 8

Motor Vehicle Mfrs. Ass’n v. State Farm

Mut. Auto. Ins. Co.,

463 U.S. 29 (1983) ................................................ 16

National Ass’n of Home Builders v. OSHA,

602 F.3d 464 (D.C. Cir. 2010) ........................ 16, 17

Ramos v. Louisiana,

140 S.Ct. 1390 (2020) ........................................... 17

Rand v. Comm’r,

141 T.C. 376 (T.C. 2013) ...................................... 12

Reich v. Arcadian Corp.,

110 F.3d 1192 (5th Cir. 1997) ........................ 16, 17

Seaworld of Fla., LLC v. Perez,

748 F.3d 1202 (D.C. Cir. 2014) .............................. 8

Stark v. Wickard,

321 U.S. 288 (1944) .............................................. 17

Stephan v. Commissioner,

197 F.2d 712 (5th Cir. 1952) ................................ 12

Tiffany v. Nat’l Bank of Mo.,

85 U.S. 409 (1873) ................................................ 11

v

United States v. Bittner,

19 F.4th 734 (5th Cir. 2021) ................................ 14

United States v. Bittner,

469 F. Supp.3d 709 (E.D. Tex. 2020) ............. 11, 18

United States v. Boyd,

991 F.3d 1077 (9th Cir. 2021) .............................. 18

United States v. Hill,

368 F.2d 617 (5th Cir. 1966) ................................ 12

United States v. Reinis,

794 F.2d 506 (9th Cir. 1986) ................................ 14

United States v. Universal C.I.T. Credit Corp.,

344 U.S. 218 (1952) .............................................. 18

United States v. Wiltberger,

5 Wheat. 76 (1820) ................................................. 7

Werckmeister v. Amer. Tobacco Co.,

207 U.S. 375 (1907) .............................................. 11

West Virginia v. EPA,

142 S.Ct. 2587 (2022) ............................................. 8

Wooden v. United States,

142 S.Ct. 1063 (2022) ................................... 7, 8, 18

State Cases

Att’y Gen. v. John A. Biewer Co.,

363 N.W.2d 712 (Mich. App. 1985) ...................... 13

City of Houston v. Jackson,

192 S.W.3d 764 (Tex. 2006) ................................ 12

vi

City of New York v. Verizon N.Y. Inc.,

4 N.Y.3d 255 (2005).............................................. 10

Commonwealth v. Monumental Props., Inc.,

459 Pa. 450, 329 A.2d 812 (1974) ........................ 11

Ellis v. La. Bd. of Ethics,

168 So.3d 714 (La. Ct. App. 2014) ......................... 9

First Fed. Sav. & Loan Ass’n v. Dep’t of Bus. Reg.,

472 So.2d 494 (Fla. Dist. Ct. App. 1985) ............. 10

Gibbs Constr. Co. v. State Dep’t of Labor,

540 So.2d 268 (La. 1989)...................................... 13

State ex rel. Grams v. Beach,

498 N.W.2d 83 (Neb. 1993) .................................. 13

Home Const. Mgmt., LLC v. Comet, Inc.,

125 So.3d 221, 222 (Fla. App. 2013) .................... 12

King v. State,

447 S.W.3d 126 (Ark. App. 2014) ........................ 12

Ports Petrol. Co., Inc. v. Tucker,

323 Ark. 680, 916 S.W.2d 749 (1996) .................. 10

RBG Bush Planes, LLC v. Alaska Pub.

Offices Comm’n,

361 P.3d 886 (Alaska 2015) ................................... 9

Saskill v. 4-B Accept.,

487 N.E.2d 97 (Ill. App. 1985) ............................. 13

Spradlin v. City of Fulton,

982 S.W.2d 255 (Mo. 1998) .................................. 12

vii

State Dep’t of Revenue v. Collins Entm’t,

340 S.C. 77 (2000) ................................................ 10

State v. Hurley,

2015 Vt. 46 (2015) ................................................ 10

Washington v. Dep’t of Pub. Works,

954 A.2d 945 (D.C. 2008) ..................................... 12

Whitfield v. United States,

99 A.3d 650 (D.C. 2014) ......................................... 9

In re Woodrow Wilson Constr. Co.,

563 So.2d 385 (La.Ct.App. 1990) ......................... 10

Young Oil Co. v. Racetrac Petrol., Inc.,

757 So.2d 380 (Ala. 1999) .................................... 10

Federal Statutes

29 U.S.C. § 1132(c) .................................................... 12

31 U.S.C. § 5314(a) .............................................. 11, 13

31 U.S.C. § 5321(a)(5) ......................................... 11, 13

I.R.C. § 294(d)(2) (1952) ............................................ 11

I.R.C. § 6672 (1954) ................................................... 12

Administrative Procedure Act, 5 U.S.C.

§ 551 et seq............................................................ 14

5 U.S.C. § 553(b)(3) .............................................. 14

5 U.S.C. § 558(b) .............................................. 6, 17

viii

Clean Water Act, 33 U.S.C. § 1319 ......................... 4, 8

33 U.S.C. § 1319(c)(1)............................................. 8

33 U.S.C. § 1319(d) ................................................ 8

Federal Civil Penalties Inflation

Adjustment Act of 1990, Public Law

101–410, 104 Stat. 890 .......................................... 8

Occupational Safety and Health Act of

1970, 29 U.S.C. §§ 651-678 .................................. 16

29 U.S.C. § 652(8), OSH Act § 3(8) ...................... 17

29 U.S.C. § 654(a)(1), OSH Act § 5(a)(1) ............. 17

State Statutes

D.C. Code § 8-804(f) (2001) ....................................... 12

Fla. Stats. § 768.0425(2) (2007) ................................ 12

Ill. Rev. Stat. 1983, Chapter 17, par. 6413 ............... 13

La. Rev. Stat. 38:2301(F) .......................................... 13

MCL 323.10(1); MSA 3.529(1)(1) .............................. 13

Minn. Stat. § 181.13 .................................................. 12

Neb. Rev. Stat. § 81-1508(1)(c) ................................. 13

Tex. Loc. Gov’t Code § 143.134(h) ............................. 12

Rules

Supreme Court Rule 37.6 ............................................ 1

ix

Regulations

29 C.F.R. § 1910.5(f) .................................................. 17

29 C.F.R. § 1910.95(k)(1) (2009) ......................... 15, 16

29 C.F.R. § 1926.1101(k)(9)(i) (2007) ........................ 15

73 Fed. Reg. 75,568 (Dec. 12, 2008) .................... 15, 16

75 Fed. Reg. 8844 (Feb. 26, 2010) ............................. 14

87 Fed. Reg. 1676, 1678 (Jan. 12, 2022) ..................... 8

Constitutional Provisions

U.S. Const., Article I, § 8, cl. 3 .................................. 17

Other Authorities

Jonathan Charney, The Need for

Constitutional Protections for

Defendants in Civil Penalty Cases, 59

CORNELL L. REV. 478 (1974) .................................. 8

SCALIA & GARNER READING LAW: THE

INTERPRETATION OF LEGAL TEXTS 296

(2012) .......................................................... 9, 11, 18

1

In The Supreme Court of the United States

No. 21-1195

ALEXANDRU BITTNER, PETITIONER

V.

UNITED STATES OF AMERICA

ON WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE FIFTH CIRCUIT

Brief of Amici Curiae National Federation of

Independent Business Small Business Legal

Center, National Association of Home Builders

of the United States, American Farm Bureau

Federation, Restaurant Law Center, and Corn

Refiners Association, In Support of Petitioner

Interests of the Amici Curiae1

The National Federation of Independent Business

(“NFIB”) Small Business Legal Center is the nation’s

leading small business association, representing

members in Washington, D.C., and all fifty states.

Its membership spans the spectrum of business

1 All parties have consented to the filing of this brief by filing

blanket consents with this Court or providing written consent.

Pursuant to Supreme Court Rule 37.6, amici curiae states that

no counsel for any party authored this brief in whole or in part

and no entity or person, aside from the amici curiae, its

members, or its counsel, made any monetary contribution

intended to fund the preparation or submission of this brief.

2

operations, ranging from sole proprietor enterprises

to firms with hundreds of employees. Founded in

1943 as a nonprofit, nonpartisan organization,

NFIB’s mission is to promote and protect the right of

its members to own, operate, and grow their

businesses. The NFIB Small Business Legal Center

(“Legal Center”) is a nonprofit, public interest law

firm established to provide legal resources and be the

voice for small businesses in the nation’s courts

through representation on issues of public interest

affecting small businesses. To fulfill its role as the

voice for small business, the Legal Center frequently

files amicus briefs in cases that will impact small

businesses.

The Restaurant Law Center (“Law Center”) is the

only independent public policy organization created

specifically to represent the interests of the food

service industry in the courts. This labor-intensive

industry is comprised of over one million restaurants

and other food-service outlets employing nearly 16

million people—approximately 10 percent of the U.S.

workforce.

Restaurants and other food-service

providers are the second largest private sector

employers in the United States. Through amicus

participation, the Law Center provides courts with

perspectives on legal issues that have the potential

to adversely affect its members and their industry.

The National Association of Home Builders of the

United States (“NAHB”) is a Washington, D.C.-based

trade association whose mission is to enhance the

climate for housing and the building industry. About

one-third of NAHB’s approximately 120,000

members are home builders or remodelers, and are

3

responsible for the construction of 80% of all new

homes in the United States.

The remaining

members work in closely related fields within the

housing industry, such as environmental consulting,

mortgage finance and building products and services.

The American Farm Bureau Federation (“AFBF”),

headquartered in Washington, D.C., was formed in

1919 and is the largest nonprofit general farm

organization in the United States. Representing

about six million member families in all fifty states

and Puerto Rico, AFBF’s members grow and raise

every type of agricultural crop and commodity

produced in the United States. Its mission is to

protect, promote, and represent the business,

economic, social, and educational interests of

American farmers and ranchers. To that end, AFBF

regularly participates in litigation, including as

amicus curiae in this and other courts.

The Corn Refiners Association (“CRA”) is the

national trade association representing the corn

refining industry of the United States. CRA and its

predecessors have served this important segment of

American agribusiness since 1913. Corn refiners

manufacture

sweeteners,

starch,

advanced

bioproducts, corn oil and feed products from corn

components such as starch, oil, protein and fiber.

*

*

*

The members of the Amici are every day subject

to thousands of federal regulations for which civil

penalties can be imposed for their violation. These

civil penalties can be so severe, and civil monetary

4

penalties can be so many, as to destroy businesses,

ruin careers, and cripple industries.

Civil monetary penalties can be even more

oppressive when agencies seek to multiply them by

urging narrow units of violation on courts.

Moreover, at least one federal agency is now

artificially manipulating the wording of its

regulations solely to increase the number of

violations.

The determination of a unit of violation needs to

be constrained by the rule of lenity (or, equivalently,

the rule of narrow or strict construction). It also

needs to be restrained by a holding that courts may

not rely on the wording of such regulations except

where, as here, the citizenry can be misled by them.

Summary of Argument

1. Lenity should apply to civil penalty

prosecutions. A rule of lenity should apply to civil

penalty prosecutions because the same reasons for

applying lenity in criminal cases—fair notice,

separation of powers, and “the tenderness of the law

for the rights of individuals”—also apply to civil

penalty prosecutions. Civil penalties can destroy

careers and businesses and even determine the fate

of an industry. It is often difficult to distinguish the

magnitude of criminal and civil monetary sanctions.

For example, the Clean Water Act now imposes a

maximum daily civil penalty of $59,973 but a

maximum daily criminal penalty of $25,000 for

negligent violations.

5

Justice

Gorsuch

recently

observed

that,

“Historically, lenity applied to all ‘penal’ laws—that

is, laws inflicting any form of punishment, including

ones we might now consider ‘civil’ forfeitures or

fines.” And several federal circuit and a number of

state courts have, without apparent difficulty,

applied a lenity rule in civil penalty cases. A rule of

lenity applicable to civil cases could reflect the lesser

weight of that sanction.

2. This case can be decided on a narrower ground

for applying a rule of lenity: It should be enough to

decide this case to hold that lenity applies when

construing the particular statutory provision that

imposes the civil penalty or is argued to state or

imply the unit of violation—regardless of whether

lenity applies when construing the statutory

provision or regulation that was allegedly violated.

That lenity should be applied to provisions that

impose civil penalties was the actual holding of

Comm’r v. Acker, 361 U.S. 87 (1959). A number of

lower federal courts, and a large number of state

courts, have applied lenity when construing the

particular provisions that impose civil penalties.

3. Courts should not rely on the wording of a

regulation or form to determine a unit of violation,

except to avoid misleading the public. The Fifth

Circuit here correctly recognized that reliance on the

wording of a regulation to resolve a unit-of-violation

issue would ascribe to its wording a power that the

agency lacks. Regulations could be used to define

units of violation—and justify the imposition of

multiple penalties—even if the agency has neither a

6

delegation of statutory authority nor

statutory criteria to decide the matter.

guiding

Unfortunately, the specter raised by the Fifth

Circuit has already come to pass: One agency

(OSHA) openly manipulated the wording of its

regulations expressly to increase the number of

penalties.

Its actions were not constrained or

disciplined by anything in its organic statute, and it

identified no statute that made the choice of unit of

violation a “factor[] which Congress . . . intended it to

consider,” under this Court’s precedent. Although

the D.C. Circuit upheld the changes, its reasoning—

that a rule maker “stands in the shoes of the

legislature”—was flawed for, unlike Congress,

agencies do not exercise plenary authority. Agencies

require delegations of authority, especially with

regard to sanctions. 5 U.S.C. § 558(b) (“A sanction

may not be imposed … except within jurisdiction

delegated to the agency and as authorized by law.”).

A delegation of authority to regulate conduct does

not carry with it the authority to decide the unit of

violation. The Court should thus make clear that the

wording of regulations should not be relied upon to

determine units of violation.

There is, however, an instance, important to this

case, in which the wording of a regulation or form

can be relevant to the unit of violation—where it can

mislead regulated persons into believing that the

number of penalties that could be imposed would be

fewer than an agency now claims. According to the

District Court and Ninth Circuit, that is this case.

Such

regulations

and

administrative

7

pronouncements can deprive citizens of fair notice—a

core principle served by the rule of lenity.

Argument

I.

A rule of lenity should be applied if a civil

penalty can be imposed.

A rule of lenity should apply here because the

reasons for applying lenity in criminal cases also

apply to civil penalty prosecutions. First, the rule

applied in criminal cases (“sometimes cast as the

idea that ‘[p]enal statutes must be construed

strictly’” (SCALIA & GARNER, READING LAW: THE

INTERPRETATION OF LEGAL TEXTS 296 (2012)) reflects

the constitutional due process requirement that laws

provide fair notice of punitive consequences. E.g.,

Dunn v. United States, 442 U.S. 100, 112 (1979).

Second,

the

criminal

rule

vindicates

the

constitutional principle of separation of powers, for it

keeps the power of punishment firmly “in the

legislative, not in the judicial department.” United

States v. Wiltberger, 5 Wheat. 76, 95 (1820). Third,

lenity also rests “on the tenderness of the law for the

rights of individuals.” Id.

These principles also apply to civil penalty

prosecutions. Fair notice is required before a civil

penalty can be imposed. FCC v. Fox Television

Stations, Inc., 567 U.S. 239, 253 (2012) (regulatory

monetary penalty). See also Wooden v. United

States, 142 S.Ct. 1063, 1082 (2022) (Gorsuch, J.,

concurring in the judgment) (lenity “enforce[s] the

fair notice requirement by ensuring that an

individual’s liberty always prevails over ambiguous

laws”). The principle of separation of powers applies

8

to civil penalty cases.

West Virginia v. EPA,

142 S.Ct. 2587, 2609 (2022). And a lenity rule for

civil penalty cases would also reflect “the tenderness

of the law for the rights of individuals,” for civil

penalties can destroy careers and businesses (e.g.,

Lucia v. SEC, 138 S.Ct. 2044, 2050 (2018) (“lifetime

bar” from profession)), and even determine the fate of

an industry (e.g., Seaworld of Fla., LLC v. Perez,

748 F.3d 1202 (D.C. Cir. 2014) (OSHA regulation of

animal shows)). Indeed, it is often difficult to

distinguish the magnitude of criminal and civil

monetary sanctions. For example, the Clean Water

Act now imposes a maximum civil penalty of $59,973

“per day for each violation” (33 U.S.C. § 1319(d)

(originally, $25,0002)) and a maximum criminal

penalty of “$25,000 per day of violation” for negligent

violations. 33 U.S.C. § 1319(c)(1). See Jonathan

Charney, The Need for Constitutional Protections for

Defendants in Civil Penalty Cases, 59 CORNELL L.

REV. 478 (1974) (discussing Congress’s “mere change

of label, from criminal to civil” of certain federal

regulatory sanctions).

There is no apparent reason why a civil version of

the rule of lenity should not be applied when

determining units of violation in civil penalty

prosecutions. “Historically, lenity applied to all

‘penal’ laws—that is, laws inflicting any form of

punishment, including ones we might now consider

‘civil’ forfeitures or fines.” Wooden, 142 S.Ct. at 1086

2 87 Fed. Reg. 1676, 1678 (Jan. 12, 2022), adjusting for inflation

under the Federal Civil Penalties Inflation Adjustment Act of

1990, Public Law 101–410, 104 Stat. 890, as amended.

9

n. 5 (Gorsuch, J.), citing cases. See also SCALIA &

GARNER at 297 (lenity “applies not only to crimes but

also to civil penalties.”). And several circuits have,

without apparent difficulty, applied a lenity rule in

civil penalty cases. First Nat’l Bank of Gordon v.

Dep’t of the Treasury, 911 F.2d 57, 65 (8th Cir. 1990)

(banking statute; “[p]enal provisions, even those

involving civil penalties, should be strictly

construed”); Kropp Forge Co. v. Sec’y of Labor,

657 F.2d 119, 122 (7th Cir. 1981) (OSHA case;

“traditional rule that the applicability of penal

sanctions in regulations is to be narrowly

construed”); Dravo Corp. v. OSHRC, 613 F.2d 1227,

1232 (3d Cir. 1980) (“penal sanction” sought;

“coverage of an agency regulation should be no

broader than what is encompassed within its

terms”); Diamond Roofing Co. v. OSHRC, 528 F.2d

645, 649 (5th Cir. 1976) (despite OSH Act’s remedial

purpose, ambiguous standard that “subjects private

parties to criminal or civil sanctions” is not broadly

construed). See also the cases cited on page 12

below. A number of state appellate courts have also

applied the rule to civil penalties.3

RBG Bush Planes, LLC v. Alaska Pub. Offices Comm’n ,

361 P.3d 886, 892 (Alaska 2015) (“ambiguous statutory or

regulatory requirements must be strictly construed . . . [if]

breach may give rise to a civil penalty”); Whitfield v. United

States, 99 A.3d 650, 656 n.14 (D.C. 2014) (“that [the law in

question] is a civil traffic regulation, rather than an actual

criminal statute, is of no moment. The rule of lenity is not so

unduly restrictive”); Ellis v. La. Bd. of Ethics, 168 So.3d 714,

724 (La. Ct. App. 2014) (discipline for ethical violation;

“principle applies to . . . civil statutes of a penal nature” and

“has been applied in the area of administrative law”), cited and

cont’d

3

10

A rule of lenity applicable to civil penalty

prosecutions need not apply with the same force as

in criminal cases. Its force in a civil penalty case

could reflect the lesser weight of that sanction. But

such a rule should apply.

II.

Regardless of whether lenity applies

when a civil penalty can be imposed,

lenity should apply when construing the

particular statutory provision that

imposes a civil penalty or provides a unit

of violation.

This case can be decided on a narrower ground for

applying a rule of lenity: Lenity should apply when

construing the particular statutory provision that

imposes the civil penalty or is argued to state or

imply the unit of violation, regardless of whether

lenity should be applied when construing the

statutory provision or regulation that was allegedly

violated. Cf. Bifulco v. United States, 447 U.S. 381,

387 (1980) (criminal case; lenity “applies not only to

partially quoted with approval by State v. Hurley, 2015 Vt. 46

(2015); City of New York v. Verizon N.Y. Inc., 4 N.Y.3d 255,

258-59 (2005); State Dep’t of Revenue v. Collins Entm’t,

340 S.C. 77, 79 (2000); Young Oil Co. v. Racetrac Petrol., Inc.,

757 So.2d 380, 383 (Ala. 1999) (predatory pricing statute); Ports

Petrol. Co., Inc. v. Tucker, 323 Ark. 680, 684, 916 S.W.2d 749,

753 (1996) (same); In re Woodrow Wilson Constr. Co., 563 So.2d

385, 389-91 (La.Ct.App. 1990) (air quality regulation enforced

by civil penalties is “a penal regulation and must be strictly

construed”); First Fed. Sav. & Loan Ass’n v. Dep’t of Bus. Reg.,

472 So.2d 494, 495 (Fla. Dist. Ct. App. 1985) (“statutes

imposing a penalty, even a civil penalty, must be strictly

construed”). See also the cases cited in n. 6.

11

interpretations of the substantive ambit of criminal

prohibitions, but also to the penalties they impose”).

That lenity should be applied to the provision

that imposes a civil penalty was the actual holding of

Comm’r v. Acker, 361 U.S. 87 (1959). There, lenity

was applied to construe the particular provision that

allegedly imposed the civil penalty sought, namely

I.R.C. § 294(d)(2) (1952).4 Such a focus was also at

work in Werckmeister v. Amer. Tobacco Co., 207 U.S.

375, 381 (1907), a civil forfeiture and penalty case,

where the Court stated: “This section of the statute

is penal, and there should be especial care to work no

extension of its provisions by construction.”

(Emphases added.)5 Inasmuch as provisions that

impose penalties (here, 31 U.S.C. § 5314(a)) or from

which the unit of violation might be implied (here,

31 U.S.C. § 5321(a)(5)) define “what the extent of the

punishment will be” (SCALIA & GARNER at 296), they

should be subject to a rule of lenity.

United States v. Bittner,

469 F. Supp.3d 709, 724 (E.D. Tex. 2020)), Acker was not

limited to tax cases. Acker principally rested on Keppel v.

Tiffin Sav. Bank, 197 U.S. 356, 362 (1905), a bankruptcy case,

on Tiffany v. Nat’l Bank of Mo., 85 U.S. 409 (1873), a bank

interest case, and Elliott v. R.R., 99 U.S. 573, 576 (1878), a tax

penalty case.

4 And contrary to the District Court (

Cf. Commonwealth v. Monumental Props., Inc., 459 Pa. 450,

460-61, 329 A.2d 812, 817 (1974) (statute requiring that

“[p]enal provisions” be “strictly construed” applies only to

penalty-imposing provisions; that “a statute ‘contains’ a penal

provision [does not mean that] the entire statute must be

strictly construed”).

5

12

A number of lower federal court decisions have

applied lenity when construing the particular

provisions that impose civil penalties.

E.g.,

Haberern v. Kaupp Vascular Surgeons Pens. Plan,

24 F.3d 1491, 1505 (3d Cir. 1994) (29 U.S.C.

§ 1132(c); civil ERISA “penalty provisions are

construed strictly”), cert. denied, 513 U.S. 1149

(1995); Fisher v. Metro. Life Ins. Co., 895 F.2d 1073,

1077 (5th Cir. 1990) (29 U.S.C. § 1132(c); “[a]s a

penalty provision, must be strictly construed”); Gold

Kist, Inc. v. Dep’t of Agric., 741 F.2d 344, 348 (11th

Cir. 1984) (no express civil penalty provision, penalty

sought to be implied; Acker applied); United States v.

Hill, 368 F.2d 617, 621 (5th Cir. 1966) (penaltyimposition portion of I.R.C. § 6672 (1954) “strictly

construed”). See also tax cases such as Stephan v.

Commissioner, 197 F.2d 712, 714 (5th Cir. 1952)

(civil tax penalty provision construed “strictly”); and

Rand v. Comm’r, 141 T.C. 376, 393 (T.C. 2013) (civil

tax penalty provision). Many state courts have

applied lenity to penalty-imposing provisions.6 At

Karlen v. Jones Lang LaSalle Americas, Inc., 766 F.3d 863,

867 (8th Cir. 2014) (applying state law) (Minn. Stat. § 181.13

“creates a civil penalty”; “strictly construed”); King v. State,

447 S.W.3d 126, 128 (Ark. App. 2014) (forfeiture statute

“construed narrowly”); Home Const. Mgmt., LLC v. Comet, Inc.,

125 So.3d 221, 222 (Fla. App. 2013) (treble damage provision,

Fla. Stats. § 768.0425(2) (2007), imposes penalty; “narrowly

construe[d]”); City of Houston v. Jackson, 192 S.W.3d 764, 770

(Tex. 2006) (Tex. Loc. Gov’t Code § 143.134(h) imposing civil

penalty; “strictly construed”); Washington v. Dep’t of Pub.

Works, 954 A.2d 945, 948-49 (D.C. 2008) (“lateness penalty”

imposed by D.C. Code § 8-804(f) (2001); lenity applied; detailed

discussion); Spradlin v. City of Fulton, 982 S.W.2d 255, 261

(Mo. 1998) (attorney fee provision “penal in nature,” “strictly

cont’d

6

13

least one independent federal adjudicative agency

(the Occupational Safety and Health Review

Commission) applies a lenity rule when determining

the unit of violation.7

In sum, lenity should be applied when construing

provisions under which a penalty might be imposed

(here, 31 U.S.C. § 5314(a)) or from which the unit of

violation might be implied (here, 31 U.S.C.

§ 5321(a)(5)).

construed”); State ex rel. Grams v. Beach, 498 N.W.2d 83, 85

(Neb. 1993) (civil penalty imposed by Neb. Rev. Stat.

§ 81-1508(1)(c); “penal statute”; “strictly construed”); Gibbs

Constr. Co. v. State Dep’t of Labor, 540 So.2d 268, 269 (La.

1989) (civil penalty imposed by former La.R.S. 38:2301(F);

“strictly construed”); Att’y Gen. v. John A. Biewer Co.,

363 N.W.2d 712, 716-17 (Mich. App. 1985) (civil penalty

imposed by MCL 323.10(1); MSA 3.529(1)(1); “strictly

construed”); Saskill v. 4-B Accept., 487 N.E.2d 97, 98 (Ill. App.

1985) (penal fee shifting statute, Ill. Rev. Stat. 1983, ch. 17, par.

6413; “construed strictly”).

Erik K. Ho, 20 BNA OSHC 1361, 1370 (OSHRC 2003) (“perinstance violations and penalties are appropriate when the

cited regulation or standard clearly prohibits individual acts

rather than a single course of action”) (emphasis added), aff’d

sub nom. Chao v. OSHRC, 401 F.3d 355 (5th Cir. 2005),

followed in Dayton Tire, 23 BNA OSHC 1247, 1257 (OSHRC

2010), rev’d on other grounds, 671 F.3d 1249 (D.C. Cir. 2012);

E. Smalis Painting Co., 22 BNA OSHC 1553, 1578 (OSHRC

2009); and Gen. Motors Corp., 22 BNA OSHC 1019, 1046

(OSHRC 2007).

7

14

III.

Regulations may not be considered in

determining the unit of violation except

to avoid misleading the public.

If a statute is ambiguous with respect to the unit

of violation, courts should not, with the exception

noted below, determine the unit of violation by

relying on the wording of an implementing

regulation or form,8 but should rely solely on the

language of the statute.

The Fifth Circuit here correctly recognized that

reliance on the wording of a regulation to resolve a

unit-of-violation issue would ascribe to its wording a

power that the agency lacks. Such reliance would

“give the Secretary discretion not only to define the

reporting mechanism, but also to define the number

of violations subject to penalty.” United States v.

Bittner, 19 F.4th 734, 746 (5th Cir. 2021). Units of

violation could thus be defined—and multiple

penalties imposed—even if the agency has neither a

delegation of statutory authority nor guiding

statutory criteria to decide the matter. Nothing in

the statute here suggests that the Secretary was

authorized to decide what the unit of violation should

8 Federal courts have held that the Administrative Procedure

Act, 5 U.S.C. § 551 et seq. (“APA”) and specifically § 553(b)(3),

requires forms to undergo notice-and-comment rulemaking if

they contain substantive requirements beyond their

implementing regulation. See United States v. Reinis, 794 F.2d

506, 508 (9th Cir. 1986), citing United States v. $200,000 in

United States Currency, 590 F. Supp. 866 (S.D.Fla. 1984). The

instructions on the FBAR form apparently underwent such

rulemaking. See 75 Fed. Reg. 8844, 8851-54 (Feb. 26, 2010).

15

be or contains criteria by which he could so decide.

(Whether Congress could constitutionally delegate

such authority thus need not be considered here.)

Unfortunately, the specter raised by the Fifth

Circuit has already come to pass: An agency has

artificially manipulated the wording of its

regulations expressly to increase the number of

penalties. In 2008, the Occupational Safety and

Health Administration (“OSHA”) noted that when

determining the unit of violation, adjudicators had

looked to the wording of OSHA’s occupational safety

and health standards. Clarification of Employer

Duty To Provide Personal Protective Equipment and

Train Each Employee, 73 Fed. Reg. 75,568, 75569

col. 3, 75570-72 (Dec. 12, 2008).9 To make clear that

per-employee penalties were to be imposed for

violations of training and personal protective

equipment standards (id. at 75,568 cols. 2-3), OSHA

amended over a hundred such provisions. Id. at

75583-89. For example, one provision previously

required “a training program for all employees” overexposed to noise. 29 C.F.R. § 1910.95(k)(1) (2007)

(emphasis added).10 OSHA moved “program” to a

One cited case was Erik K. Ho, 20 BNA OSHC 1361, *9-17

(OSHRC 2003), aff’d sub nom. Chao v. OSHRC, 401 F.3d 355

(5th Cir. 2005), cited in 73 Fed. Reg. 75,568, 75569 col. 3 (Dec.

12, 2008). It concerned 29 C.F.R. § 1926.1101(k)(9)(i) (2007)

(asbestos), which then required “a training program” for “all

employees” in certain categories.

9

10 The previous provision read as follows:

“The employer shall

institute a training program for all employees who are exposed

to noise at or above an 8-hour time-weighted average of 85

cont’d

16

new sentence and changed “all” to “each.”11 Thus,

before 2008 an employer who erroneously believed

that a requirement for a training “program” did not

apply to its one-hundred employee workforce would

have been penalized once; after 2008, a hundred

penalties could be assessed.

These changes were not constrained or disciplined

by anything in OSHA’s organic statute, the

Occupational Safety and Health Act of 1970,

29 U.S.C. §§ 651-678 (“OSH Act”). OSHA identified

no OSH Act provision that made the choice of unit of

violation a “factor[] which Congress . . . intended it to

consider.” Motor Vehicle Mfrs. Ass’n v. State Farm

Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). OSHA

reasoned that, because the amendments “add no

additional requirements,” it could make the changes

without making findings that otherwise would be

statutorily required. 73 Fed. Reg. at 75570 cols. 2-3.

The D.C. Circuit upheld the changes, reasoning

that OSHA “stands in the shoes of the legislature.”

National Ass’n of Home Builders v. OSHA, 602 F.3d

464, 467 (D.C. Cir. 2010), disagreeing with Reich v.

Arcadian Corp., 110 F.3d 1192, 1198-1199 (5th Cir.

decibels, and shall ensure employee participation in such

program.” 29 C.F.R. § 1910.95(k)(1) (2007).

11 The amended provision reads as follows:

“The employer shall

train each employee who is exposed to noise at or above an 8hour time weighted average of 85 decibels in accordance with

the requirements of this section. The employer shall institute a

training program and ensure employee participation in the

program.” 29 C.F.R. § 1910.95(k)(1) (2009).

17

1997).12 The analogy was inapt. Congress exercises

plenary authority over (in that case) interstate

commerce (U.S. Const., Art. I, § 8, cl. 3)) but agencies

do not. Agencies require delegations of authority,

especially with regard to sanctions. 5 U.S.C. § 558(b)

(“A sanction may not be imposed or a substantive

rule or order issued except within jurisdiction

delegated to the agency and as authorized by law.”);

Stark v. Wickard, 321 U.S. 288, 309 & n. 22 (1944)

(“the power of agencies is circumscribed by the

authority granted”); see also Gutierrez-Brizuela v.

Lynch, 834 F.3d 1142 (10th Cir. 2016) (Gorsuch, J.,

concurring) (“ancient and venerable principle”). A

delegation of authority to regulate conduct does not

carry the authority to decide the unit of violation—

whether a citizen is to be penalized multiple times

for what may be, for example, a single course of

12 The Fifth Circuit held that per-employee penalties may not

be imposed under the OSH Act’s “General Duty Clause”

(29 U.S.C. § 654(a)(1), OSH Act § 5(a)(1)), a gap filler applicable

when no standard applies (29 C.F.R. § 1910.5(f)) and requiring

protection from “recognized hazards . . . likely to cause . . .

serious physical harm.” The Fifth Circuit reasoned that

imposing per-employee penalties under that gap filler would be

“anomalous” because a core rulemaking provision (the

definition of “standard” in 29 U.S.C. § 652(8), OSH Act § 3(8)

(see Indus. Union Dep’t. v. Amer. Petrol. Inst., 448 U.S. 607,

639 (1980))) permits OSHA only “to promulgate standards

governing ‘conditions’ and ‘practices’ of employment,” not to “set

a unit of prosecution.” 110 F.3d at 1198. The D.C. Circuit

characterized this statement as “dictum.” 602 F.3d at 467.

That was error, for the statement was part of the Fifth Circuit’s

ratio decidendi. Ramos v. Louisiana, 140 S.Ct. 1390, 1404 &

n.54 (2020); Duncan v. Louisiana, 391 U.S. 145, 184 n. 24

(1968) (Harlan, J., dissenting) (not dictum if “critical to the

chain of reasoning by which a result is . . . reached”).

18

conduct. Cf. United States v. Universal C.I.T. Credit

Corp., 344 U.S. 218, 224-26 (1952) (unit of wage-hour

criminal violation is course of conduct).

The Court should thus make clear that the

wording of regulations or forms should not be relied

upon to determine units of violation. If a statute

does not clearly state the unit of violation and all

interpretive avenues have been exhausted (Wooden

v. United States, 142 S.Ct. 1063, 1075 (2022)

(Kavanaugh, J., concurring)), but “a reasonable

doubt persists” (SCALIA & GARNER at 299), then

lenity would be required.

There is, however, an instance, also important to

this case, in which the wording of a regulation or

form can be relevant to the unit of violation—where

that wording can mislead regulated persons into

believing that the number of penalties that could be

imposed would be fewer than an agency now claims.

According to the District Court and Ninth Circuit,

that is this case. The District Court emphasized the

single-FBAR

approach

of

the

regulations.

469 F. Supp.3d at 720 (“the number of . . . accounts

. . . maintain[ed] has no bearing whatsoever on [the]

obligation to file an FBAR” under the regulations”).

The Ninth Circuit concluded that the unit of

violation was the form rather than the account based

on “[t]he statute, read with the regulations . . . .”

(United States v. Boyd, 991 F.3d 1077, 1079 (9th Cir.

2021)) and laid heavy emphasis on the regulations’

wording. Id. at 1081-83. See also the administrative

materials, including the FBAR instructions, set out

on pages 6-10 in the certiorari-stage amicus curiae

brief of the American College of Tax Counsel. Such

19

regulations and administrative pronouncements can

deprive citizens of fair notice (Gen. Elec. Co. v. EPA,

53 F.3d 1324, 1330-34 (D.C. Cir. 1995))—a core

principle served by the rule of lenity.

Conclusion

The decision below should be reversed.

Respectfully submitted,

Of Counsel:

Arthur G. Sapper, Esq.

Counsel of Record

Elizabeth Milito, Esq.

OGLETREE, DEAKINS, NASH,

Senior Executive

SMOAK & STEWART, P.C.

Counsel

STE 1000, 1909 K STREET NW

NFIB Small Business

WASHINGTON, D.C. 20006

Legal Center, Ste. 1000 Tel. 202-263-0270

555 12th St. NW

Arthur.Sapper@ogletree.com

Washington, D.C. 20004 Counsel for Amici Curiae

Of Counsel:

Of Counsel:

Ellen Steen, Esq.

Travis Cushman, Esq.

American Farm Bureau

Federation

Ste. 1000W

600 Maryland Ave. SW

Washington, D.C. 20024

Angelo I. Amador, Esq.

Restaurant Law Center

Ste. 700, 2055 L St. NW

Washington, D.C. 20036

Thomas Ward, Esq.

National Association of

Home Builders

1201 15th Street NW

Washington, DC 20005

John W. Bode, Esq.,

Corn Refiners Association

Ste. 400, 1701 Pennsylvania

Ave. NW

Washington, D.C. 20006