Amicus Curiae Brief — Corner Post, Inc., Petitioner v. Board of Governors of the Federal Reserve System

Supreme Court briefNov 20, 2023

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No. 22-1008

IN THE

Supreme Court of the United States

————

CORNER POST, INC.,

Petitioner,

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM,

Respondent.

————

On Writ of Certiorari to the

United States Court of Appeals

for the Eighth Circuit

————

BRIEF OF THE NATIONAL FEDERATION OF

INDEPENDENT BUSINESS SMALL BUSINESS

LEGAL CENTER, INC., RESTAURANT LAW

CENTER, THE BUCKEYE INSTITUTE, AND

MANHATTAN INSTITUTE, AS AMICI CURIAE

IN SUPPORT OF PETITIONER

————

ANGELO I. AMADOR

RESTAURANT LAW CENTER

2055 L Street, NW

Ste. 700

Washington, DC 20036

(202) 331-5913

aamador@restaurant.org

ELIZABETH GAUDIO MILITO

Counsel of Record

ROB SMITH

NFIB SMALL BUSINESS LEGAL

CENTER, INC.

555 12th Street, NW

Ste. 1001

Washington, DC 20004

(202) 406-4443

elizabeth.milito@nfib.org

rob.smith@nfib.org

DAVID C. TRYON

THE BUCKEYE INSTITUTE

88 East Broad Street

Ste. 1300

ILYA SHAPIRO

Columbus, OH 43215

IM ROSENBERGER

(614) 224-4422

ANHATTAN INSTITUTE

d.tryon@buckeyeinstitute.org

52 Vanderbilt Ave.

New York, NY 10017

(212) 599-7000

ishapiro@manhattan.institute

Counsel for Amici Curiae

WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D.C. 20002

TABLE OF CONTENTS

Page

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

iii

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

INTRODUCTION AND SUMMARY OF

ARGUMENT ....................................................

ARGUMENT ........................................................

The Majority Rule is Egregiously Wrong,

Leaving Small Businesses in a No-Win

Situation ....................................................

A. The Majority Rule is Illogical—a NonExistent Entity Cannot Have Article

III Standing, and Thus, Does Not

Have a “Complete and Present Cause

of Action.”..............................................

B. The Majority of Circuits Considering

the Question Presented Erroneously

Conflate Injury and Final Agency

Action....................................................

For Some Regulations, Like the Debit

Card-Fee Rule, Enforcement Proceedings

are a Mirage for Judicial Review .............

III. The Majority Rule Imposes Significant

Burdens on Business ................................

IV. The Government’s Reliance on Practical

Policy Considerations to Prevent Newly

Formed Entities From Vindicating Their

Legal Rights is Incorrect, Speculative,

and Unpersuasive .....................................

II.

(i)

TABLE OF CONTENTS—Continued

Page

A. Courts Are Well-Positioned to Conduct Retrospective Analyses to Determine When a Party Suffers Harm

from Government Action .....................

B. It is Unfounded to Suggest that a

Favorable Holding for Corner Post

Will Lead to Litigation Abuse or

Unmanageable Dockets .......................

CONCLUSION ....................................................

iii

TABLE OF AUTHORITIES

CASES

Page(s)

Ashcroft v. Iqbal,

556 U.S. 662 (2009) ...................................

Bay Area Laundry & Dry Cleaning Pension

Tr. Fund. v. Ferbar Corp. of Cal.,

522 U.S. 192 (1997) ................................... 7, 10

City of Arlington v. FCC,

569 U.S. 290 (2013).......................................

Clapper v. Amnesty Int’l,

568 U.S. 398 (2013) ...................................

Dunn-McCampbell Royalty Interest, Inc. v.

National Park Service,

112 F.3d 1283 (5th Cir. 1997) ...................

Herr v. U.S. Forest Serv.,

803 F.3d 809 (6th Cir. 2015) ......... 11, 12, 21, 22

Kisor v. Wilkie,

139 S. Ct. 2400 (2019) ...............................

Lowenberg v. City of Dallas,

168 S.W.3d 800 (Tex. 2005) ......................

Lujan v. Defenders of Wildlife,

504 U.S. 555 (1992) ............................. 6, 7, 9, 20

Lujan v. Nat’l Wildlife Fed’n,

497 U.S. 871 (1990) ................................... 11-13

Rawlings v. Ray,

312 U.S. 96 (1941) .....................................

Sackett v. EPA,

566 U.S. 120 (2012) ...................................

Spokeo, Inc. v. Robins,

578 U.S. 330 (2016) .....................................

TABLE OF AUTHORITIES—Continued

Page(s)

TransUnion LLC v. Ramirez,

141 S. Ct. 2190 (2021) ...............................

6, 9

Wind River Mining Corp. v. United States,

946 F.2d 710 (9th Cir. 1991) .....................

CONSTITUTION

U.S. Const. art. III.............................. 3, 6, 7, 9, 10

U.S. Const. art. III, § 2, cl. 1 ........................

STATUTES

5 U.S.C. § 702 ..................................... 3, 11, 12, 21

5 U.S.C. § 704 ............................................... 3, 11

26 U.S.C. § 501(c)(3) .....................................

28 U.S.C. § 2401 ...........................................

RULES AND REGULATIONS

Corporate

Average

Fuel

Economy

Standards for Model Years 2024-2026

Passenger Cars and Light Trucks, 87

Fed. Reg. 25710 (May 2, 2022) .................

Federal Reserve Board’s (Board) Debit

Card Interchange Fees and Routing

Rule, 76 Fed. Reg. 43394

(July 20, 2011).................... 4, 8-10, 12-18, 20-22

Revised 2023 and Later Model Year LightDuty Vehicle Greenhouse Gas Emissions

Standards, 86 Fed. Reg. 74434 (Dec. 30,

2021) .......................................................... 15, 16

TABLE OF AUTHORITIES—Continued

Page(s)

12 C.F.R. § 235.2(k) ......................................

12 C.F.R. § 235.2(l) .......................................

12 C.F.R. § 235.3(a) ...................................... 13, 18

12 C.F.R. § 235.3(b) ...................................... 13, 18

12 C.F.R. § 235.9 ..........................................

12 C.F.R. § 235.9(a)(1)(i) ..............................

12 C.F.R. § 235.9(a)(1)(ii) .............................

12 C.F.R. § 235.9(a)(1)(iii) ............................

12 C.F.R. § 235.9(a)(1)(iv) ............................

12 C.F.R. § 235.9(c) ......................................

OTHER AUTHORITIES

Angel Au-Yeung, Visa, Mastercard Prepare

to Raise Credit-Card Fees, Wall. St. J.

(Aug. 30, 2023 3:23pm), https://tinyurl.

com/mkj8ez mf ..........................................

AnnaMaria Andriotis, Another Challenge

for Small Businesses: Higher Card Fees

Could Be on the Way, Wall St. J. (Apr. 9,

2020 5:30am), https://on.wsj.com/3p3Eu

2C...............................................................

Kristina Partsinevelos, et al., How small

businesses are fighting inflated credit

card swipe fees, CNBC (Feb. 9, 2023

11:14am), https:// cnb.cx/42ih9IM ............

TABLE OF AUTHORITIES—Continued

Page(s)

Luke Goldstein, Small Businesses Rise to

Fight Wall Street, The Am. Prospect (Feb.

7, 2023), https://bit.ly/3NBGfOF ..............

Magna Carta (1215) .....................................

NFIB Rsch. Ctr., Small Business Problems

& Priorities (2020), https://bit.ly/44np6

Oz...............................................................

Press Release, Merchants Payments Coalition, Merchants Call for Action as Swipe

Fees Rise Again (Mar. 21, 2023), https://

bit.ly/3Vwhx 4s ............................................

Swipe Fees, Nat’l Retail Fed’n, https://bit.ly/

3HCwsnE (last visited November 14,

2023) ..............................................................

Visa and Mastercard to Increase Swipe

Fees, NACS (Aug. 31, 2023), https://tiny

url.com/ 5k3asxae ......................................... 18-19

INTEREST OF AMICI CURIAE1

The National Federation of Independent Business

Small Business Legal Center, Inc. (NFIB 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. It is an affiliate of the National Federation

of Independent Business, Inc. (NFIB), which is the

nation’s leading small business association. NFIB’s

mission is to promote and protect the right of its

members to own, operate, and grow their businesses.

NFIB represents, in Washington, D.C., and all 50 state

capitals, the interests of its members.

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 foodservice outlets employing nearly 16

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

workforce. Restaurants and other foodservice 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 significantly impact

its members and their industry. The Law Center’s

amicus briefs have been cited favorably by state and

federal courts.

Pursuant to Supreme Court Rule 37.6, amici curiae state that

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

and no entity or person, aside from amici curiae, their members,

or their counsel, made any monetary contribution intended to

fund the preparation or submission of this brief.

The Buckeye Institute was founded in 1989 as an

independent research and educational institution—a

think tank—whose mission is to advance free-market

public policy in the states. The staff at The Buckeye

Institute accomplishes the organization’s mission by

performing timely and reliable research on key issues,

compiling and synthesizing data, formulating freemarket policy solutions, and marketing them for

implementation in Ohio and replication nationwide.

The Buckeye Institute is a nonpartisan, non-profit,

tax-exempt organization as defined by I.R.C. section

501(c)(3). The Buckeye Institute’s Legal Center files

and joins amicus briefs that are consistent with its

mission and goals.

The Manhattan Institute for Policy Research (MI) is

a nonpartisan public policy research foundation whose

mission is to develop and disseminate ideas that foster

greater economic choice and individual responsibility.

MI’s constitutional studies program aims to preserve

the Constitution’s original public meaning. To that

end, it has historically sponsored scholarship regarding quality-of-life issues, property rights, and economic

liberty.

Amici file this brief because the legal and practical

implications of the Eighth Circuit’s decision, and those

circuits adopting the same analysis, undermine due

process and significantly harm businesses.

INTRODUCTION AND

SUMMARY OF ARGUMENT

“To no one will we sell, to no one deny or delay

right or justice.” – Magna Carta (1215)

Multiple federal appellate courts have fashioned

a rule of law, the “majority rule,” which routinely

denies justice on procedural grounds. These courts

deny entrepreneurs and new businesses the ability to

challenge agency regulations more than six years old,

even if the rule first started affecting them today. In

doing so, these courts deny justice by preventing new

entities from vindicating their legal rights.

The majority rule holds that the six-year statute of

limitations for challenging agency rules under the

Administrative Procedure Act (APA) begins to run

against all people and entities everywhere at the exact

same moment—the instant the rule is promulgated.

By doing so, the majority rule ignores Article III

standing and this Court’s precedent on when a

“complete and present cause of action” exists to begin

a statute of limitations. It also conflates the two

distinct requirements to bring an APA challenge: 1)

“suffering legal wrong” or being “adversely affected or

aggrieved by agency action”; and 2) that the agency

action be final. See 5 U.S.C § 702; 5 U.S.C. § 704.

Federal appellate courts adopting the majority rule

have confused the “what” in the analysis—the injury

from the agency action—with the “when”—the final

agency action. While these two separate showings may

be satisfied at the same time, they are not always.

In at least 24 states and the District of Columbia

(those comprising the jurisdiction of the Fourth, Fifth,

Eighth, Ninth, and D.C. Circuits), the majority rule

immunizes agency rules from constitutional or statu-

tory challenges in certain contexts. The Sixth Circuit

has correctly rebuffed the majority rule.

The legal and practical consequences of the majority

rule are immense.

Legally, the majority rule works to prevent new

businesses from vindicating their rights in court. For

some regulations, including the Federal Reserve

Board’s (Board) Debit Card Interchange Fees and

Routing Rule, 76 Fed. Reg. 43394 (July 20, 2011)

(hereinafter “debit card-fee rule”), the conduct regulated is against manufacturers of products, or middle

entities in the supply chain. Though these types of

regulations significantly impact merchants, end sellers,

and consumers, they will never face enforcement actions

in which to challenge the rule. Such enforcement

actions would be against financial institutions only.

Under the majority rule, and without the ability to

challenge through enforcement actions, new entities

injured by these types of regulations are denied their

day in court.2

Practically, the majority rule permits financial

burdens on small businesses. Here, the debit card-fee

rule imposes significant fees on small businesses, like

Corner Post, when customers use debit cards. When

Corner Post tried to challenge the debit card-fee rule

within six years of first having to pay the fees imposed

by the rule, the lower courts prevented it from doing

so based on the erroneous majority rule.

Concerns about allowing new entities to challenge regulation

paving the road for perpetual challenges are unfounded. If a

challenge is successful, then there would be no additional

challenges to that regulation. If the challenge is unsuccessful and

the rule sustained, that affirmance would be persuasive authority

for dismissal of future challenges. See also infra IV.B (addressing

litigation abuse concerns from Petitioner’s theory).

Rejecting the majority rule will not overburden

district courts or lead to abusive litigation against

agency regulation. District courts already conduct

retrospective analyses to determine when a party

suffered harm under the standing analysis. Running

the statute of limitations from the time a new entity

was first “aggrieved,” as the Sixth Circuit did, requires

nothing more. There is also no evidence to suggest that

a favorable holding for Corner Post will lead to

increased litigation or litigation abuse.

Only this Court can correct the majority rule and

provide relief for Corner Post, entrepreneurs, and the

business community.

The Court should reverse the judgment below.

ARGUMENT

I. The Majority Rule is Egregiously Wrong,

Leaving Small Businesses in a No-Win

Situation.

The majority rule insulates federal agencies from

challenges to the validity of a regulation merely due to

the passage of time. See, e.g., Wind River Mining Corp.

v. United States, 946 F.2d 710, 715 (9th Cir. 1991) (“The

government’s interest in finality outweighs a latecomer’s desire to protest the agency’s action[.]”). But

see Dunn-McCampbell Royalty Interest, Inc. v. National

Park Service, 112 F.3d 1283, 1290 (5th Cir. 1997)

(Jones, J., dissenting) (“[A] regulation initially unauthorized by statute cannot become authorized by the

mere passage of time.”).

The Ninth Circuit, and others adopting the majority

rule, punish independent businesses simply based on

their date of first operation. Indeed, a “late-comer’s

desire” to challenge agency action is more appropriately deemed a new-comer’s vindication of legal rights.

The majority rule wrongfully runs the statute of

limitations for APA claims from the date of final

agency action. Doing so ignores the role of Article III

standing for a statute of limitations to commence and

conflates the two distinct requirements for an APA

action, that a challenger prove: 1) the suffering of a

legal wrong, or adverse effect or aggrievement; and 2)

a final agency action.

These legal errors of the majority rule force new

businesses into a Hobson’s choice. They must either: 1)

challenge an agency action as a potential business

owner and lose based on lack of Article III standing; 2)

challenge an agency action as a new business and lose

based on the APA statute of limitations; or 3) give up

the right to hold government agencies accountable for

unlawful regulations.

A. The Majority Rule is Illogical—a NonExistent Entity Cannot Have Article III

Standing, and Thus, Does Not Have a

“Complete and Present Cause of Action.”

To begin, a review of basic principles. Federal court

jurisdiction extends only to “Cases” or “Controversies.”

U.S. Const. art. III, § 2, cl. 1. Standing is a guardrail to

ensure courts stay within Article III’s subject-matter

boundaries. See, e.g. TransUnion LLC v. Ramirez, 141

S. Ct. 2190, 2203 (2021); Lujan v. Defenders of Wildlife,

504 U.S. 555, 559-60 (1992). To have standing, a

plaintiff must demonstrate: 1) an injury in fact that is

both (a) “concrete and particularized”, and (b) ‘‘‘actual

or imminent, not ‘conjectural’ or ‘hypothetical’”’; 2) the

injury was caused by the Defendant’s conduct; and 3)

is redressable by a favorable decision. Lujan, 504 U.S.

at 560-61 (citations omitted).

Where a statute of limitations comes into play, “the

limitations period commences when the plaintiff has

a ‘complete and present cause of action.’” Bay Area

Laundry & Dry Cleaning Pension Tr. Fund. v. Ferbar

Corp. of Cal., 522 U.S. 192, 201 (1997) (quoting

Rawlings v. Ray, 312 U.S. 96, 98 (1941)). The phrase

“complete and present cause of action” refers to having

a valid lawsuit, not merely the filing of any lawsuit.

See id. at 201 (“[A] cause of action does not become

‘complete and present’ for limitations purposes until

the plaintiff can file suit and obtain relief.” (emphasis

added; citation omitted)).

In Bay Area Laundry, this Court unanimously

rejected a similar proposition to the majority rule at

issue here:

The Court of Appeals held that the statute of

limitations on a pension plan's action to

recover unpaid withdrawal liability runs from

the date the employer withdraws from the

plan. On that view, the limitations period

commences at a time when the plan could not

yet file suit. Such a result is inconsistent with

basic limitations principles, and we reject it. A

plan cannot maintain an action until the

employer misses a scheduled withdrawal

liability payment. The statute of limitations

does not begin to run until that time.

Id. at 200-01 (emphasis added).

Putting these legal principles together, a plaintiff

must demonstrate an injury to have standing. Article

III requires standing to obtain federal judicial relief.

An ability to obtain relief is necessary for, by this

Court’s own words, a “complete and present cause of

action.” A “complete and present cause of action” must

exist for a statute of limitations to commence. Thus,

where there is no injury and standing, there is no

“complete and present cause of action” for a statute of

limitations to commence.

Logic, precedent, and these common-sense standing

principles should have decided this case. But instead,

the Eighth Circuit held that the statute of limitations

began to run in 2011 when the debit card-fee rule was

published, as opposed to when Petitioner first suffered

harm from the rule. In doing so, the Eighth Circuit

joined other federal appellate courts in holding that

the statute of limitations begins to run for APA challenges upon promulgation of agency rules. Pet. 11-16.

The majority rule violates the basic legal principles

mentioned above and this case perfectly demonstrates

how. Petitioner did not open its doors until 2018, seven

years after publication of the debit card-fee rule.

According to the majority rule, Petitioner would have

had to challenge the debit card-fee rule prior to its

existence as a business—and before its subjugation to

the rule—to comply with the statute of limitations.

But it could not do so for obvious reasons—standing.

Petitioner suffered no personal “concrete and particularized” and “actual or imminent” injury prior to 2018

as a nonexistent business.

Consider the following two hypotheticals to demonstrate Petitioner’s lack of concrete harm under the

majority rule:

In the first, an existing small business is subject to

the Board’s debit card-fee rule in 2014. The company

sued, alleging that the Board exceeded its statutory

authority. In the second, an individual thinking about

one day starting a business sued the Board in 2014

challenging the debit card-fee rule.3

In the latter hypothetical, the individual suffered no

personal harm from the regulation. See TransUnion,

LLC, 141 S. Ct. at 2205 (using a similar set of

hypotheticals to demonstrate why one person lacked

concrete harm for standing compared to another). For

an APA challenge, the majority rule requires Petitioner

to be the second hypothetical for statute of limitations

compliance, even though TransUnion makes clear the

second hypothetical plaintiff lacks standing.

Petitioner also would have failed the “particularized” standing inquiry to challenge the debit card-fee

rule in the timeframe the majority rule requires, as

there would have been no personal harm prior to the

business’ existence. See Spokeo, Inc. v. Robins, 578 U.S.

330, 339-40 (2016) (discussing that “particularized”

requires a personal and distinct injury to the plaintiff).

Nor could Petitioner satisfy the “actual or imminent”

injury requirement for Article III standing prior to

opening its business in 2018. Potential plans to engage

in an activity, such as one day opening a business that

would be forced to pay debit card fees, are not an actual

injury. Lujan, 504 U.S. at 564 (holding no “actual or

imminent” injury where plaintiffs had “‘some day’

intentions—without any description of concrete plans”

to engage in conduct). Nor would an “‘[a]llegation[] of

possible future injury’” based on opening a business

be enough to satisfy the imminency requirement.

See Clapper v. Amnesty Int’l, 568 U.S. 398, 409 (2013)

(quoted source omitted; emphasis in original) (no

For these hypotheticals, the year 2014 is only relevant to the

extent that both are clearly within six years of the debit card-fee

rule’s promulgation.

certainly impending injury based on speculative fear

of future harm).

Petitioner did not open until 2018 and did not suffer

an injury sufficient for standing by the debit card-fee

rule until then when it began paying the debit card

fees. Cf. Lowenberg v. City of Dallas, 168 S.W.3d 800,

802 (Tex. 2005) (per curiam) (holding, in an action

challenging the imposition of a fee, that a claim

accrued for statute of limitations purposes when the

fee was paid instead of when it was enacted). Without

an injury sufficient for standing, Petitioner could not

have filed suit and obtained relief. With no ability to

obtain relief within six years of 2011, there was

no “complete and present cause of action.” Bay Area

Laundry, 522 U.S. at 201. Because there was no

“complete and present cause of action” until 2018, the

statute of limitations could not commence until then.

The Government concedes that its position, and the

majority rule, runs the statute of limitations prior to

plaintiffs having a justiciable cause of action, conflicting with this Court’s precedent. Resp’t Br. in Opp. to

Cert. 16 (“[I]f the statute of limitations on an APA

claim began to run only when a particular plaintiff

possessed a justiciable cause of action . . . .”). But see

Bay Area Laundry, 522 U.S. at 201 (“[T]he limitations

period commences when the plaintiff has a ‘complete

and present cause of action.’”).

Bottom line, the Eighth Circuit’s decision below and

majority rule that the six-year limitations period

begins to run for APA claims upon publication of a

regulation requires many small business owners to do

something they cannot—sue for relief prior to having

Article III standing. This Court should correct the

majority rule and provide clarity for new businesses

seeking to enforce their legal rights.

B. The Majority of Circuits Considering

the Question Presented Erroneously

Conflate Injury and Final Agency Action.

An additional infirmity of the majority rule and

Eighth Circuit’s holding is that they have jumbled the

analysis for an APA challenge. The analysis should be

straightforward.

First, a person must have suffered an injury4 from

the agency’s action. 5 U.S.C. § 702 (“A person suffering

legal wrong because of agency action, or adversely

affected or aggrieved by agency action . . . is entitled to

judicial review thereof.”). Second, when challenging

under the general review provisions of the APA, the

challenged action must be a “final agency action.” 5

U.S.C. § 704; Sackett v. EPA, 566 U.S. 120, 125-26

(2012) (discussing that the APA’s judicial review

provision requires “final agency action”).

The majority rule, joined by the Eighth Circuit,

conflates these two distinct showings. See Lujan v.

Nat’l Wildlife Fed’n, 497 U.S. 871, 882-83 (1990)

(distinguishing between the “two separate requirements” for APA suits—agency action, including “final

agency action,” and suffering an injury). In essence,

the federal appellate courts adopting the majority rule

have confused the “what” in the analysis—the injury

from the agency action—with the “when”—the final

agency action. While these two separate showings may

be satisfied at the same time, they need not be. Instead

of recognizing, as the Sixth Circuit did in Herr v. U.S.

Forest Serv., 803 F.3d 809 (6th Cir. 2015), that an injury

may occur upon final agency action, the majority rule

For conciseness, amici use the phrase “injury” in this section

as a shorthand for “suffering legal wrong” or “adversely affected

or aggrieved” as set forth in 5 U.S.C. § 702.

assumes that an injury always occurs upon a final

agency action. And that is where the majority rule

errs. See Pet. 11-16 (discussing the circuit split).

Only the Sixth Circuit has provided the correct

analysis that final agency action is a “necessary, but

not by itself a sufficient, ground for stating a claim

under the APA.” Herr, 803 F.3d at 819; see also Lujan,

497 U.S. at 883 (“Second, the party seeking review

under § 702 must show that he has ‘suffer[ed] legal

wrong’ because of the challenged agency action, or is

‘adversely affected or aggrieved’ by that action[.]”). As

Herr noted, a “right of action [may] happen[] to accrue

at the same time that final agency action occur[s],” but

“that is not the case when . . . the party does not suffer

any injury until after the agency’s final action.” Id. at

819-20 (emphasis in original).

Here, the majority rule cannot work. Petitioner

suffered no injury when the Board published the debit

card-fee rule in 2011, because Petitioner did not exist

at that time and was not regulated by the rule at its

promulgation. See id. A rule cannot injure a person

or entity that is not under the rule’s dominion at

promulgation. For example, courts would not permit a

suit to proceed from a person claiming injury under

§ 702 against the debit card-fee rule if that person does

not pay the debit card fee.

By conflating the injury and final agency action

requirements for an APA claim, the majority rule holds

that a final agency action injures all people, everywhere, at the exact same moment. Put in other

contexts, the majority rule is akin to saying all

baseball players are injured upon the first pitch,

instead of when hit by a pitch; the 24-second shot clock

in basketball runs against both teams, instead of just

the team with possession; or the statute of limitations

for a tort claim runs not from the commission of a tort,

but instead, from the moment the legislature passes

the law giving rise to the tort.

This Court should correct the jumbled analysis of

the majority rule and reinforce Lujan’s, 497 U.S. at

882-83, distinction between the two separate requirements for APA claims.

II. For Some Regulations, Like the Debit

Card-Fee Rule, Enforcement Proceedings

are a Mirage for Judicial Review.

Enforcement proceedings are not a realistic option

for new entities to seek judicial review of agency regulation. This is so because agencies do not primarily

enforce some regulations, such as the debit card-fee

rule, against the seller of products.

The debit card-fee rule imposes a cap on the

“interchange transaction fee that an issuer may

receive or charge with respect to an electronic debit

transaction[.]” 76 Fed. Reg. at 43467 (codified at

12 C.F.R. § 235.3(a)). Issuers are those who authorize

the use of debit cards to perform electronic debit

transactions. Id. (codified at 12 C.F.R. § 235.2(k)). The

amount of the fee must be “reasonable and proportional to the cost incurred by the issuer”, which the

rule defines as not exceeding the sum of 21 cents,

plus 5 basis points multiplied by the value of the

transaction. Id. (codified at 12 C.F.R. § 235.3 (a)-(b)).

The debit card-fee rule gives authority to enforce the

fee caps to different agencies, based solely on the type

of issuer involved. Id. at 43468–69 (codified at 12 C.F.R.

§ 235.9). For example, enforcement against banks is

from the “appropriate federal banking agency” under

the Federal Deposit Insurance Act;5 against credit

unions from the Administrator of the National Credit

Union Administration;6 against air carriers from the

Secretary of Transportation;7 against brokers or dealers

from the Securities and Exchange Commission;8 and

against all other issuers not specifically listed from the

Federal Trade Commission.9

Enforcement of the debit card-fee rule is not against

merchants10 like Corner Post and other small businesses. Corner Post and similarly situated new

entities are unlikely to face enforcement proceedings

where courts can review the rule. Instead, the fee caps

set forth in the rule are enforced against the issuers

themselves. If issuers charge fees in excess of the caps

set forth in the rule, merchants can report those

issuers to the Board or appropriate federal agency,

and any enforcement action would be brought by

the agency against the issuer bank, credit union, etc.

Likewise, if merchants such as Corner Post wanted to

dispute the amount of the fees applied to them, they

would have to do so with the issuer, not the agency. The

hierarchical structure created by the debit card-fee

rule, wherein the Board and governing agencies are at

the top, issuers regulated in the middle, and merchants

like Corner Post at the bottom, insulates agencies from

rule review in enforcement proceedings, and prevents

76 Fed. Reg. 43394, 43468 (codified at 12 C.F.R. § 235.9(a)(1)(i)).

Id. at 43468–69 (codified at 12 C.F.R. § 235.9(a)(1)(ii)).

Id. at 43469 (codified at 12 C.F.R. § 235.9(a)(1)(iii)).

Id. at 43469 (codified at 12 C.F.R. § 235.9(a)(1)(iv)).

Id. at 43469 (codified at 12 C.F.R. § 235.9(c)).

The debit card-fee rule defines merchant as “any person that

accepts debit cards as payment.” Id. at 43467 (codified at 12

C.F.R. § 235.2(l)).

rule challenges by new entities through enforcement

proceedings.

The debit card-fee rule is not alone.

Another example is the Corporate Average Fuel

Economy Standards for Model Years 2024-2026 Passenger Cars and Light Trucks, 87 Fed. Reg. 25710

(May 2, 2022). In this rule, the National Highway

Traffic Safety Administration (NHTSA) regulates vehicle

manufacturers, imposing mandatory fuel standards

8% higher for model year 2024–2025 vehicles and 10%

higher for 2026 vehicles. Id. The rule imposes standards on and regulates only vehicle manufacturers.

Like the debit card-fee rule, this regulation imposes a

regime where enforcement proceedings will be against

a middleman, instead of the final sellers.

Under the majority rule and Government’s arguments, a new automotive sales business in 2029, forced

to charge higher prices on vehicles due to the downstream impacts of the fuel standard regulation on

manufacturers,11 would be foreclosed from challenging

the regulation. They could not wait for an enforcement

proceeding to do so, because the agency’s enforcement

proceeding would be against the manufacturer of the

vehicle, not the seller.

Similarly, enforcement proceedings would be bad

avenues for challenging the Revised 2023 and Later

Model Year Light-Duty Vehicle Greenhouse Gas

Emissions Standards, 86 Fed. Reg. 74434 (Dec. 30,

2021). This Environmental Protection Agency (EPA)

rule imposes “more stringent national greenhouse gas

NHTSA concedes that the rule will lead to higher upfront

costs for consumers. Corporate Average Fuel Economy Standards

for Model Years 2024-2026 Passenger Cars and Light Trucks, 87

Fed. Reg. 25710, 25731 (May 2, 2022).

(GHG) emissions standards for passenger cars and

light trucks” in model years 2023–2026. Id. at 74435.

Like the NHTSA rule above, EPA imposes these GHG

standards on the manufacturers of vehicles. Downstream

sellers or users of the regulated products (for this rule,

sellers and users of passenger cars and light duty

trucks; for the debit card-fee rule, businesses like

Corner Post and consumers who pay swipe fees) will

not have enforcement actions taken against them

because the rules regulate an entity higher in the

supply chain.

In sum, enforcement proceedings are not always

viable options for judicial review of agency regulations.

This is the case here, and with other regulations where

the agency’s regulation targets entities higher in the

supply chain than end sellers and consumers. In these

situations, end sellers and users are not the target of

enforcement proceedings and are unable to substantively challenge the rule via that mechanism.

III. The Majority Rule Imposes Significant

Burdens on Business.

To reiterate, the majority rule adopted by the Eighth

Circuit below holds that the six-year statute of

limitations for general APA claims runs for the entire

world from the moment of final agency action. Not only

is this rule legally questionable, but it comes with

colossal real-world consequences.

Today’s “‘administrative state with its reams of

regulations would leave [the Framers] rubbing their

eyes.’” City of Arlington v. FCC, 569 U.S. 290, 313 (2013)

(Roberts, C.J., dissenting) (quoted source omitted). The

federal bureaucracy continues to grow, adding dozens

of new agencies in recent years, id., with a Code of

Federal Regulations spanning nearly 185,000 pages.

Kisor v. Wilkie, 139 S. Ct. 2400, 2447 (2019) (Gorsuch,

J., concurring) (citations omitted).

The majority rule prevents businesses from challenging the validity of a crushing regulation if more

than six years passed between the final rule and the

opening of the business. Because of the majority

rule, a prospective small business owner must spend

days, weeks, or months scouring the Code of Federal

Regulations for all regulations that may apply to their

new business. Failing to do so could expose them to

unforeseen financial costs, like debit card fees. The

prospective business owner could hire consultants and

lawyers, but these professionals cost money, and a

prospective small business owner sits on limited

resources. Even for already-existing small businesses,

the “Cost of Outside Business Services,” such as

lawyers and consultants, ranks as a major concern and

a significant obstacle to their success. See NFIB Rsch.

Ctr., Small Business Problems & Priorities, at 10

(2020), https://bit.ly/44np6Oz.

The majority rule’s prohibition on challenges to the

validity of a regulation beyond six years from the

date of final agency action forces new businesses to

acquiesce to burdensome fees and regulations.

The Federal Reserve’s interchange fees regulation

illustrates the resulting harm to small businesses. The

Federal Reserve purports to regulate these fees to

provide fairness in the market. But instead, it permits

banks and card networks to unreasonably profit from

interchange fees on the backs of both small businesses

and all consumers. While the debit card-fee rule limits

the total fee issuers can impose, the rule does not limit

the profit issuers can make when the average pertransaction cost falls below the total fee limit. The rule

requires that the amount of an interchange fee for

debit transactions “be reasonable and proportional to

the cost incurred by the issuer with respect to the

electronic debit transaction.” 76 Fed. Reg. at 43467

(codified at 12 C.F.R. § 235.3(a)). But then the rule

defines “reasonable and proportional” as “21 cents

and[] 5 basis points multiplied by the value of the

transaction” regardless of the actual fee cost. Id.

(codified at 12 C.F.R. § 235.3(b)). Thus, whether the

average per-transaction cost is 2 cents or 20 cents,

banks can charge small businesses the same amount

in interchange fees, even though the rule itself says

the fee must be “proportional to the cost incurred[.]”

Id. (codified at 12 C.F.R. § 235.3(a)). It strains credulity

to say that a fixed fee cap, which never adjusts based

on the actual average per-transaction cost, is proportional to that actual cost incurred. And so the federal

regulation, which can no longer be challenged according

to the majority rule, harms small businesses without

any available recourse in this highly regulated field.

This is no small problem. Card processing fees, such

as those imposed by the debit card-fee rule, are a major

financial concern for small businesses. For some merchants, interchange fees are the largest operating cost

behind payroll. App. 59. According to the National

Retail Federation, which tracks swipe fees, these costs

eclipse $160 billion per year. Swipe Fees, Nat’l Retail

Fed’n, https://bit.ly/3HCwsnE (last visited November

14, 2023). In 2022, the average household paid over

$1,000 dollars in swipe fees. Press Release, Merchants

Payments Coalition, Merchants Call for Action as

Swipe Fees Rise Again (Mar. 21, 2023), https://bit.ly/

3Vwhx4s. The problem keeps growing—the total amount

of swipe fees for debit cards rose by nearly 6% last year.

Id. For the convenience retailing industry, credit card

swipe fees rose by 82% between 2020 and 2022. Visa

and Mastercard to Increase Swipe Fees, NACS (Aug.

31, 2023), https://tinyurl.com/5k3asxae. To make matters

worse, Visa and Mastercard recently announced

plans to again increase card fees. Angel Au-Yeung,

Visa, Mastercard Prepare to Raise Credit-Card Fees,

Wall. St. J. (Aug. 30, 2023 3:23pm), https://tinyurl.com/

mkj8ezmf (recognizing that credit card fees have

increased from under $33 billion in 2012 to over $93

billion in 2022).

Consider Sol Dias, a Dallas-area ice cream shop. In

2022, Sol Dias paid $25,000 in swipe fees, and expects

to pay $30,000 in 2023. Kristina Partsinevelos, et al.,

How small businesses are fighting inflated credit card

swipe fees, CNBC (Feb. 9, 2023 11:14am), https://

cnb.cx/42ih9IM. One thousand miles away in Elkhart,

Indiana, Stephenson’s, a specialty garment store, faces

similar burdens from swipe fees. Stephenson’s pays

40% more in swipe fees than they did two years ago.

Luke Goldstein, Small Businesses Rise to Fight Wall

Street, The Am. Prospect (Feb. 7, 2023), https://

bit.ly/3NBGfOF. Swipe fees are the second-largest cost

for Stephenson’s, beating out business utilities and

narrowly trailing labor costs. Id. Small businesses

providing life necessities like food or gas will pay even

greater amounts. Hub Convenience Stores, a small

business consisting of six gas stations, paid almost

$400,000 in swipe fees in 2019, representing over 2%

of its total sales. AnnaMaria Andriotis, Another

Challenge for Small Businesses: Higher Card Fees

Could Be on the Way, Wall St. J. (Apr. 9, 2020 5:30am),

https://on.wsj.com/3p3Eu2C. These high fees not only

harm existing businesses, but they dissuade new businesses from starting. Equally important, consumers

are harmed with no way to challenge the regulations.

Amici urge this Court to consider the debit card-fee

rule’s significant financial burden on businesses—

especially new businesses—and consumers.

IV. The Government’s Reliance on Practical

Policy Considerations to Prevent Newly

Formed Entities From Vindicating Their

Legal Rights is Incorrect, Speculative, and

Unpersuasive.

For whatever value the Court gives to policy considerations at issue in this case, it should ensure they

are not exaggerated or misstated. Beyond the detriment to businesses discussed above, amici address two

policy considerations below.

A. Courts Are Well-Positioned to Conduct

Retrospective Analyses to Determine

When a Party Suffers Harm from

Government Action.

In opposing certiorari, the Government claimed

that running the six-year statute of limitations from

when a party first suffers harm from government action

would force courts to “conduct retrospective analyses

to determine when the plaintiff became ‘aggrieved’

by the challenged action[.]” Resp’t Br. in Opp. to Cert.

16–17.

Exactly. Courts across the country conduct retrospective standing analyses every day. Part of the

standing inquiry is to determine whether a party

suffered or suffers an injury in fact, or concrete harm,

from the alleged wrongful government action. The

Government itself cites a case where the courts did

exactly that. See Resp’t Br. in Opp. to Cert. 16–17

(citing to Lujan v. Defenders of Wildlife, 504 U.S. 555

(1992)); see also Lujan, 504 U.S. at 562–67 (discussing

factual allegations in affidavits to determine injury).

Moreover, parties alleging harm from agency regulation will still need to present enough facts to

demonstrate a plausible claim for relief. See Ashcroft v.

Iqbal, 556 U.S. 662, 677–80 (2009).

Courts can and do engage in retrospective analyses

to determine when and how a party was harmed by

government action. Running a statute of limitations

from the time a newly formed entity was first

“aggrieved” by agency action under 5 U.S.C. § 702 will

not require courts to engage in novel or unusual

determinations.

B. It is Unfounded to Suggest that a

Favorable Holding for Corner Post Will

Lead to Litigation Abuse or Unmanageable Dockets.

The district court held that the statute of limitations

for Corner Post to challenge the debit card-fee rule

began to run prior to Corner Post’s existence and

payment of debit card fees under the rule. In doing so,

the court relied on speculative concerns, noting that

“Plaintiffs’ theory” could lead to parties “creat[ing] a

new entity that would be subject to the Rule” anytime

they “wanted to bring a facial challenge against an

agency rule or regulation beyond the six-year statute

of limitations[.]” App. 36. The Government also cited

this concern in opposing certiorari. Resp’t Br. in Opp.

to Cert. 16. With respect to the district court and

Government, this concern over litigation abuse is

unfounded.

As previously discussed, the Sixth Circuit in Herr

held that a “right of action [may] happen[] to accrue at

the same time that final agency action occur[s]” but

“that is not the case when . . . the party does not suffer

any injury until after the agency’s final action.” Herr,

803 F.3d at 819-20 (emphasis in original).

Amici performed a Westlaw search to see whether

the district court and Government’s speculation had

merit. In the 8 years since Herr, only 50 cases, in all

federal courts of appeals and federal district courts,

cited to that decision for any proposition. In another

search with a start date of October 9, 2015 (Herr’s

decision), only 23 cases, in all federal courts of appeals

and district courts, cited 28 U.S.C. § 2401 and referenced Herr. Any challenge to agency regulation postsix years assuredly would cite the statute of limitations

and the seminal case supporting review.

Even if the speculation were to come to fruition,

courts could easily weed out those cases through the

traditional standing inquiry. To have an injury in fact,

an entity would likely need to purchase or rent a

location for its business, hire employees, buy inventory,

and begin operating to the public as a business before

it could challenge an agency regulation on business

activity, such as the debit card-fee rule. For many

businesses, the upfront assured costs to put itself in a

position to challenge long-ago agency action would not

be worth the possibility of a favorable outcome against

that entrenched agency regulation.

Moreover, there should be little concern that a ruling

for Corner Post will lead to unmanageable court

dockets from legitimate challenges to agency action.

As the Government acknowledges, Corner Post’s

situation is “relatively uncommon.” Resp’t Br. in Opp.

to Cert. 11 (conceding it is “relatively uncommon” for a

circumstance to exist “where a person who was not

injured when the rule was promulgated becomes

injured at a later date”). Holding that an APA claim

may first accrue on the date of final agency action, but

does not always do so, will not overburden courts

with challenges to long-ago regulation. Instead, it will

merely provide the ability for newcomers to vindicate

their legal rights when the “uncommon” situation

occurs.

Without evidence, or something more than mere

speculation, the Court should be skeptical of claims

that a favorable outcome for Corner Post will lead to

gamesmanship, litigation abuse, or unmanageable

dockets.

CONCLUSION

The Court should reverse the judgment below.

Respectfully submitted,

ANGELO I. AMADOR

RESTAURANT LAW CENTER

2055 L Street, NW

Ste. 700

Washington, DC 20036

(202) 331-5913

aamador@restaurant.org

ELIZABETH GAUDIO MILITO

Counsel of Record

ROB SMITH

NFIB SMALL BUSINESS LEGAL

CENTER, INC.

555 12th Street, NW

Ste. 1001

Washington, DC 20004

(202) 406-4443

elizabeth.milito@nfib.org

rob.smith@nfib.org

DAVID C. TRYON

THE BUCKEYE INSTITUTE

88 East Broad Street

Ste. 1300

ILYA SHAPIRO

Columbus, OH 43215

IM ROSENBERGER

(614) 224-4422

ANHATTAN INSTITUTE

d.tryon@buckeyeinstitute.org

52 Vanderbilt Ave.

New York, NY 10017

(212) 599-7000

ishapiro@manhattan.institute

Counsel for Amici Curiae

November 20, 2023

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.