Amicus Curiae Brief — United States v. Texas, 136 S. Ct. 2271 (2016) (No. 15-674)

No. 15-674

IN THE

Supreme Court of the United States

UNITED STATES OF AMERICA, et al.,

Petitioners,

VU.

STATE OF TEXAS, et al.,

Respondents.

On Wait or CERTIORARI TO THE UNITED STATES

Court or APPEALS FOR THE Fiera Circurr

ae —=

BRIEF OF THE NATIONAL FEDERATION

OF INDEPENDENT BUSINESS SMALL

BUSINESS LEGAL CENTER AS AMICUS

CURIAE IN SUPPORT OF RESPONDENTS

KareN R. HARNED WILLIAM 8. Consovoy

NFIB SmaA.t Business Counsel of Record

LEGAL CENTER J. MICHAEL CONNOLLY

1201 F Street, NW, Suite 200 Consovoy McCarruy

Washington, DC 20004 Park PLLC

(202) 314-5048 3038 Wilson Blvd., Suite 700

Arlington, Virginia 22201

(708) 248-9423

will@consovoymecarthy.com

April 4, 2016

— —————— -

COUNSE( PRESS

(800) 274-3821 * (800) 359-6859

i

TABLE OF CON™ENTS

Page

peo OF A ge, ER errrer errr Terre i

TABLE OF CITED AUTHORITIES .............. ii

INTEREST OF AMICUS CURIAE ............+55: l

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

cb py sGudun vactasstpabheccivrasaccteed 6

I. The APA’s Notice-And-Comment

Command Is An Indispensable

I I coc ce vaveveesccececténes 6

Il. DAPA Is Invalid Because It Did Not

Go Through Notice and Comment In

Accordance With The APA ..............555 14

A. The APA’s Exceptions To Notice-

And-Comment Rulemaking Are

ge ere 15

B. A Rule Is Not A “General Statement Of

Policy” If Its Binds The Agency......... 18

C. DAPA Is Not A “General Statement

I iene tase deeneucenvccetncecaes 24

Ill. This Administration Has Habitually

Ignored The Notice-And-Comment

Requirement Of The APA .............50555 28

CORTEAMIEE vv ccccvccencverescssecccseccenves 33

uw

TABLE OF CITED AUTHORITIES

CASES

Alcaraz v. Block,

746 F.2d 593 (9th Cir. 1984).............

Am. Bus Ass'n v. United States,

627 F.2d 525 (D.C. Cir. 1980) ...........

Am. Hosp. Ass'n v. Bowen,

834 F.2d 1037 (D.C. Cir. 1987) ..........

Appalachian Power Co. v. EPA,

208 F.3d 1015 (D.C. Cir. 2000)...........

Batterton v. Marshall,

648 F.2d 694 (D.C. Cir. 1980) ...........

Chamber of Commerce v.

Occupational Safety & Health Admin.,

636 F.2d 464 (D.C. Cir. 1980) ...........

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

GOT ULB. GET GG ew vce nccccncccnccces

Chocolate Mfrs. Ass'n of U.S. v. Block,

755 F.2d 1098 (4th Cir. 1985)............

Chrysler Corp. v. Brown,

OEE Ts Bee CSF cv vccscccecescceocs

Page

jusdabes 28

i

Table of Contents

Page

City of Arlington, Tex. v. FCC,

SC EE cease ies caeeacesaceuiee 7, 8,9

City of Idaho Falls, Idaho v.

Fed. Energy Reg. Comm'n,

629 F.3d 232 (D.C. Cir. 2011). ... 0. cc ccccccccces 31

Cmty. Nutrition Inst. v. Young,

818 F.2d 948 (D.C. Cir. 1987) ................ 20-21

Crandon v. United States,

Ss CI 265 viv chai 0 bes kRiS eas erees i)

Dep't of Transp. v. Ass'n of Am. R.Rs.,

Se Th I oar eas alas ined pean knee 7

EPIC v. DHS,

oe gy as 8 errr rr ery 29

FBME Bank Ltd. v. Lew,

--- F. Supp. 3d ---, No. 15-01270, 2015 WL 5081209

DK TS cvécacdcetavsswaseaacsasuteskin 31

FCC v. Fox Television Stations,

ey Le EE 5 55 nwb 5 sbkees eaéusaen passim

FDA v. Brown & Williamson Tobacco Corp.,

a Pn (c. cundtnaccdscanernawaded’ &

Free Enterprise Fund v.

Public Co. Accounting Oversight Bd.,

SE EEE: dirk wdusouceuducsscsvicens eas 6

iw

Cited Authorities

Page

Gen. Elec. Co. v. EPA,

290 F.3d 377 (D.C. Cir. 2002) ............008. 21, 25

Gen. Motors Corp. v. Ruckelshaus,

742 F.2d 1561 (D.C. Cir. 1984)............ innate 17

Guardian Fed. Sav. & Loan Ass'n v. FSLIC,

589 F.2d 658 (D.C. Cir. 1978) ............. 19, 21, 25

Hoctor v. U.S. Dep't of Agric.,

82 F.3d 165 (7th Cir. 1996)..........cceeccees 11,27

Homemakers N. Shore, Inc. v. Bowen,

832 F.2d 408 (7th Cir. 1987) ............. cece 13

Humphrey's Ex’r v. United States,

Canidae ven Garvukes sscienweude 9g

INS v. Chadha,

SG ib na xess heabbehenenddceeaues 7

lowa League of Cities v. EPA,

711 F.3d 844 (8th Cir. 2013).....................26

J.W. Hampton, Jr. & Co. v. United States,

CS 6 be sec tudecieccuAciscuusendes 7

Jean v. Nelson,

711 F236 1466 (lith Cir. 1068)... ccccccccccves 19

Vv

Cited Authorities

Page

JEM Broad. Co. v. FCC,

an F.0G S80 (D.C. Cir. 1904) .. ccc cccccccccccece 23

King v. Burwell,

EE 8

Lewis-Mota v. Secretary of Labor,

469 F.2d 478 (D.C. Cir. 1972)........ccccccevcecs 22

Mack Trucks, Inc. v. EPA,

GBS F.8d 87 (D.C. Cir. 012) .... cece ccc ccccess 30

McLouth Steel Prods. Corp. v. Thomas,

838 F.2d 1317 (D.C. Cir. 1988). ............ 20, 21, 25

Mendoza v. Perez,

754 F.3d 1002 (D.C. Cir. 2014)............. 17, 23, 30

Mid Continent Nail Corp. v. United States,

999 F. Supp. 2d 1307 (Ct. Int’] Trade 2014)........ 31

Molycorp, Inc. v. EPA,

Be Pe A Ce BOSD bid cece cevwcvcccas 19

Morton v. Ruiz,

Re a 26, 27

Nat'l Ass’n of Home Health Agencies v.

Schweiker,

i} 4 | files 3. . ne 16

vi

Cited Authorities

Page

Nat'l Family Planning & Reprod. Health Ass'n,

Inc. v. Sullivan,

979 F.2d 227 (D.C. Cir. 1992) .........cceeees 12, 16

Nat'l Min. Ass’n v. McCarthy,

TOD Fe ee GAG, Cie BIG i dcicdccccvccsccsnnnn 8

Nat'l Nutritional Foods Ass'n v. Kennedy,

GES Fe Gee GON CR TOD 0 vcccvcctonccesanctds 16

Nat'l Tour Brokers Ass'n v. United States,

Se Fes BF Pre 14

NCTA v. Brand X Internet Servs.,

OOP GAs OOP GUND 6 0 on ccdenscveauucetaanis eee 8

Neighborhood TV Co. v. FCC,

742 F.2d 629 (D.C. Cir. 1984) ......ccceesscccees 23

NLRB v. Wyman-Gordon Co.,

oh ere 27

Pac. Gas & Elec. Co. v. FPC,

ot ee 6 Pe 20

Perez v. Mortg. Bankers Ass'n,

SD Eh CE, SOS vce ctvéiedapesueenans 3, 5,9

Pickus v. U.S. Bd. of Parole,

fe fog 8 | errr 24

vit

Cited Authorities

Page

Prof'ls & Patients for Customized Care v.

Shalala,

56 F.3d 592 (5th Cir. 1995) ............... 16, 21, 24

Shands Jacksonville Med. Ctr. v. Burwell,

--- F. Supp. 3d ---, No. 14-1477, 2015 WL 5579653

CEG cccscsceticccecececses 11-12

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

TEs cccccdseviencsoovescescccce 9

Sorenson Commce'ns Inc. v. FCC,

EE |

Sprint Corp. v. FCC,

315 F.3d 369 (D.C. Cir. 2008) ...............205. 17

State of N.J., Dep’t of Envtl. Prot. v.

U.S. Envtl. Prot. Agency,

ow oe 16

U.S. Steel Corp. v. EPA,

ee 17

United States v. Mead Corp.,

8S ee 20

United Steel v.

Federal Highway Administration,

2015 WL 9412105 (D.D.C. 2015). ................ 29

vitt

Cited Authorities

Page

USTA v. FCC,

28 F.3d 1232 (D.C. Cir. 1994) ............... .20, 24

Valle Del Sol Inc. v. Whiting,

709 F.3d 808 (9th Cir. 2013)................0006. 25

Wong Yang Sung v. McGrath,

IG od Kcasnuscedecesacausceseees 10

STATUTES AND OTHER AUTHORITIES

Ee I Ncdcausksucnnvewewscaveéeeseueeas 15

Pb asics dccdedasvensencoseeuas 13, 15

PRIA co kcnedcsecdecsceksesescceses passim

PU ED bebe ecckvcccscveccéiesenenscc’ 3, 10

BS EAB. BI ov cc ccercccsscces 4, 15, 22, 23

RR NS 0a 060 dn csv ainceaenenuedenennes 3, 10

Ee es hncnnnncéotecedccesacuvassatnd 22

H.R. Rep. No. 79-1980 (1946)... .. 2... eee cece ee eee il

S. Doc. No. 77-8, Administrative Procedures in

Government Agencies (1941) ................ 10-11

1

Cited Authorities

Page

S. Doc. No. 248, 79th Cong., 2d Sess. 19

DE ceouN at nndcatne Kaveaiek cawceied en 12, 15-16

S. Rep. No. 752, 79th Cong. Ist Sess. (1945) ......... 16

3 Richard J. Pierce, Jr., Administrative Law

Treatise § 6.8 (5th ed. 2010) .................... 13

Black’s Law Dictionary 1345 (10th ed. 2014) .......... 22

Cass R. Sunstein, Nondelegation Canons,

Oe iy Os I I oo 50 owas cacceseese 7

Cristina M. Rodriguez, Constraint Through

Delegation: The Case of Executive

Control Over Immigration Policy,

Pe Gi, SUMING 506 665 cic vcccnasececas 27

Hearing on “Examining the Federal Regulatory

System to Improve Accountability,

Transparency and Integrity” Before

the Senate Comm. on the Judiciary,

EE BU ob sc caveccsadcceescecerssd 6,7

John F. Manning, Nonlegislative Rules, 72 Geo.

Wash. L. Rev. 893 (2004). ............. 14, 18, 20, 22

Josh Blackman, Regulation by Blog

Post: DDC Enjoins HHS From

Implementing Website FAQ................. 31-82

x

Cited Authorities

Page

Lisa Schultz Bressman, Beyond

Accountability: Arbitrariness and

Legitimacy in the Administrative State,

Fe PRs Bae CEs SE GHD 6 occ cccccccccceseses 12

Michael Asimow, Nonlegislative

Rulemaking and Regulatory Reform,

1985 Duke L.J. 381 (1985). ..............24-- 12, 13

Nina A. Mendelson, Regulatory Beneficiaries

and Informal Agency Policymaking,

92 Cornell L. Rev. 397 (2007) ...............045. 12

Richard B. Stewart & Cass R. Sunstein,

Public Programs and Private Rights,

95 Harv. L. Rev. 1198 (1982). ..................- 10

Robert A. Anthony, Interpretive Rules, Policy

Statements, Guidances, Manuals, and the

Like-Should Federal Agencies Use Them to

Bind the Public?, 41 Duke L.J. 1311 (1992) ....... 13

Stephen M. Johnson, Good Guidance, Good

Grief?, 72 Mo. L. Rev. 695 (2007) ................ 11

The Fourth Branch & Underground

Regulations, NFIB Smal! Business Legal

SE ; wwencencacetanascebeuneeas 31

Zachary S. Price, Enforcement Discretion

& Executive Duty, 67 Vand. L. Rev. 671 (2014) . . . .32

l

INTEREST OF AMICUS CURIAE'

The National Federation of Independent Business

Small Business Legal Center (“NFIB Legal Center”) is

a nonprofit, public interest law firm established to provide

legal resources and be the voice for smal] businesses in

the nation’s courts through representation on issues of

public interest affecting small businesses. The Nationa!

Federation of Independent Business (“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,

NF'IB’s mission is to promote and protect the rights of

its members to own, operate, and grow their businesses.

NFIB represents 325,000 member businesses

nationwide, and its membership spans the spectrum

of business operations, ranging from sole proprietor

enterprises to firms with hundreds of employees. While

there is no standard definition of a “small business,” the

typical NF 1B member employs 10 people and reports gross

sales of about $500,000 a year. The NFIB membership is

a reflection of American smal! business.

To fulfill its role as the voice for small business,

the NFIB Legal Center frequently files amicus briefs

in cases that will impact small businesses. The Legal

Center files in this case because small businesses have a

strong interest in ensuring that administrative agencies

1. The parties have consented to the filing of this brief. No

counsel for any party authored this brief in whole or in part, and

no person or entity other than amicus, its members, or its counse!

made a monetary contribution intended to fund the preparation

or submission of this brief.

2

follow the procedural requirements of the Administrative

Procedure Act. The regulations that agencies promulgate

almost always affect small businesses. If these agencies

override the notice-and-comment requirement, as they

often do, small businesses will lose their statutory right

to participate in these rulemakings.

SUMMARY OF THE ARGUMENT

It is common ground that the administrative state

occupies “a unique constitutional position.” FCC v. Fox

Television Stations, 556 U.S. 502, 536 (2009) (Kennedy,

J.) (concurring in part and concurring in the judgment).

Agencies exercise legislative power, executive power, and

judicial power—sometimes all at once and often beyond

the immediate control of any branch of government.

That reality has always raised legal and practical

concerns. From a legal perspective, agencies raise serious

separation-of-powers questions. Practically, the vast

authority they wield over the everyday lives of ordinary

citizens is alarming. It is with trepidation, then, that

this Court accepts as constitutional the empowerment of

unelected bureaucrats to effectively write, enforce, and

interpret federal laws.

The Administrative Procedure Act (“APA”) has

been essential in mitigating these overarching concerns.

By imposing procedural and substantive requirements

on agencies, the APA endows them with at least some

democratic legitimacy. When adhered to, the APA helps

to ensure that agencies do not exercise their sweeping

authority in arbitrary and abusive ways. Section 553’s

notice-and-comment requirement, which requires public

participation before agencies may issue most rules, is

3

the statute’s centerpiece. See 5 U.S.C. § 553(b)-(c). Under

this provision, the agency, first, “must issue a general

notice of proposed rule making.” Perez v. Mortg. Bankers

Ass'n, 135 8. Ct. 1199, 1203 (2015) (citations, quotations,

and alterations omitted). “Second, if notice is required,

the agency must give interested persons an opportunity

to participate in the rule making through submission of

written data, views, or arguments .... Third, when the

agency promulgates the final rule, it must include in the

rule’s text a concise genera! statement of its basis and

purpose.” /d.

The APA’s notice-and-comment requirement thus

promotes several important values. It promotes fairness

and transparency by affording affected parties advance

notice of new or changing legal regimes. It promotes

legitimacy by giving those who object to the proposal

the opportunity to be heard. It promotes accountability

by facilitating congressional and popular oversight. It

promotes stability by deterring ad hoc decisionmaking

and the imposition of vague standards of conduct. And, by

requiring public input, it promotes thoughtful, reasonable,

and ultimately better legal rules. An agency’s failure to

comply with the APA’s notice-and-comment requirement,

accordingly, strikes at the heart of the bargain the APA

struck between those who saw agencies as undemocratic

and constitutionally dubious and those persuaded that

“(t]he Federal Government could not perform its duties

in a responsible and effective way without” them. Fox

Television Stations, 556 U.S. at 536 (Kennedy, J.,

concurring in part and concurring in the judgment).

As both the district court and the court of appeals

held, that is what happened here: the Department

4

of Homeland Security (“DHS”) issued the Deferred

Action for Parents of Americans and Lawful Permanent

Residents Memorandum (“DAPA”) without notice and

comment. The United States defends DHS’s decision

by claiming the program is exempt under Section 553’s

exception for “‘general statements of policy.” Brief for

Petitioner (“Pet. Br.”) 68-73 (citing 5 U.S.C. § 553(b)(3)(A)).

In mounting this argument, however, the United States

ignores the APA’s essential purpose and advocates for a

novel and untenable legal standard. Given the fundamental!

values that notice-and-comment rulemaking promotes, as

well as the constitutional concerns that led to its passage

in 1946, courts have uniformly agreed that this exception

must be construed narrowly. In this area of the law, the

adage that broad exceptions will eventually swallow the

rule rings true. Procedures complicate the regulator’s life.

Notice-and-comment rulemaking can be time-consuming,

burdensome, and a flashpoint for policy disagreements.

Of course, that is the idea.

It is up to judges, therefore, to keep a watchful eye

so that regulators do not exploit limited exceptions in an

effort to bypass procedural protections that make their

unique status constitutionally tolerable. This is a case in

point. The United States takes the view that the “general

statements of policy” exception applies anytime a rule

does not “create legally enforceable rights or obligations

in regulated parties.” Pet. Br. 65. That would expand the

exception beyond the narrow circumstances to which it is

meant to apply. The better interpretation, adopted by the

lower courts, is that a rule qualifies as a general statement

of policy only if it is not binding on the agency itself. That

understanding follows from the APA’s text and purpose.

“Rules issued through the notice-and-comment process

5

are often referred to as ‘legislative rules’ because they

have the ‘force and effect of law.” Perez, 135 S. Ct. at

1203. An agency’s tentative (7.e., non-binding) conclusion

as to a particular issue does not have the force and effect

of law. If the agency plans to bind itself to a particular

view, however, there must be public input before the rule

takes effect.

The United States argues so forcefully against the

prevailing interpretation of Section 553, notwithstanding

its lack of case law support, because DAPA is obviously

binding on DHS. The district court found as a matter of

fact that the program is not discretionary. It binds, or,

at a minimum, severely restricts, the discretion of DHS

officials to deny status to an unauthorized alien who meets

DAPA’s criteria. DHS claims it has retained discretion to

deny legal status in specific cases. But the district court

found otherwise; that finding must be given credence In

short, “it is clear from the record that the only discretion

that has been or will be exercised is that already exercised

by Secretary Johnson in enacting the DAPA program

and establishing the criteria therein.” Petition Appendix

(“Pet. App.”) 386a. The way that DHS has implemented

the Deferred Action for Childhood Arrivals (“DACA”)

program bolsters that finding. Only five percent of the

723,000 DACA applications have been denied—and none

have been denied for discretionary reasons. These sibling

DHS policies are binding.

Finally, it ought to go without saying that DHS’s

violation of the APA’s notice-and-comment requirement

is no foot fault. These procedures are not for show. Their

approach nevertheless appears to signal that the United

States and its amici see DAPA as too important to be

6

enjoined for procedural reasons. That is unfortunate.

This type of ends-justifying attitude not only ignores the

raison détre of notice-and-comment procedures, it reflects

a lack of appreciation for the cultural problems it invites.

Individual rights cannot be safeguarded from arbitrary

and abusive regulations if the Executive encourages

agencies to view process as an impediment to achieving

policy goals.

Yet that has been this Administration’s message

from the outset. Since 2008, lower courts have repeatedly

stepped in to stop the Administration from running

roughshod over the APA. But a more definitive course

correction is needed. The Court should leave no doubt

that if agencies are to continue to wield legislative power,

they must be faithful to the APA’s notice-and-comment

requirement. The judgment below should be affirmed.

ARGUMENT

Il. The APA’s Notice-And-Comment Command Is An

Indispensable Structural Protection.

Agencies “wield[] vast power and touch([] almost

every aspect of daily life.” Free Enterprise Fund v.

Public Co. Accounting Oversight Bd., 561 U.S. 477, 499

(2010). There are now “over 430 departments, agencies,

and sub-agencies in the federal government.” Hearing on

“Examining the Federal Regulatory System to Improve

Accountability, Transparency and Integrity” Before the

Senate Comm. on the Judiciary, 114th Cong. 1 (2015)

(statement of Senator Grassley) (“Examining the Federal

Regulatory System”). It was only a matter of time, then,

before “the sheer amount of law—the substantive rules

7

that regulate private conduct and direct the operation

of government—made by the agencies outnumberl|ed]

the lawmaking engaged in by Congress through the

traditional process.” JNS v. Chadha, 462 U.S. 919, 985-

86 (1983) (White, J., dissenting). “The 113th Congress,

for example, enacted just under 300 laws. Over the same

two-year period, the federal bureaucracy finalized over

7,000 regulations.” Examining the Federal Regulatory

System, supra, at 1.

The means by which federal agencies secured this

sweeping power has always been a source of controversy.

Foremost, “as a practical matter they exercise legislative

power, by promulgating regulations with the force of law.”

City of Arlington, Tex. v. FCC, 133 S. Ct. 1863, 1877 (2013)

(Roberts, C.J., dissenting). Congress must “lay down by

legislative act an intelligible principle to which” the agency

at issue “is directed to conform.” J.W. Hampton, Jr. &

Co. v. United States, 276 U.S. 394, 409 (1928). But the

delegation doctrine has not often been used to discipline

Congress. “Since 1935, the Supreme Court has not struck

down an act of Congress on nondelegation grounds,

notwithstanding the existence of a number of plausible

occasions.” Cass R. Sunstein, Nondelegation Canons, 67

U. Chi. L. Rev. 315 (2000); see also Dep't of Transp. v. Ass’n

of Am. R.Rs., 135 S. Ct. 1225, 1246 (2015) (Thomas, J.,

concurring in the judgment). Thus, although the “wisdom

and the constitutionality of these broad delegations are

matters that still have not been put to rest,” there can be

no serious dispute “that agency rulemaking is lawmaking

in any functional or realistic sense of the term.” Chadha,

462 U.S. at 986 (White, J., dissenting).

8

Not only do agencies exercise legislative authority,

their interpretations of federal law often receive judicial

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

U.S. 837 (1984). Although there are notable exceptions,

see, €.g., King v. Burwell, 135 S. Ct. 2480 (2015); FDA v.

Brown & Williamson Tobacco Corp., 529 U.S. 120 (2000),

an agency’s interpretation of its organic legislation, in

the main, will control under Chevron unless “the statute

unambiguously forecloses the agency’s interpretation.”

NCTA v. Brand X Internet Servs., 545 U.S. 967, 982-83

(2005). That standard transfers interpretative authority

from courts to agencies. “By design or default, Congress

often fails to speak to ‘the precise question’ before

an agency.” City of Arlington, Tex., 133 S. Ct. at 1879

(Roberts, C.J., dissenting). “When it applies,” therefore,

“Chevron is a powerful weapon in an agency’s regulatory

arsenal.” Jd.

To be sure, Chevron is built on the “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, and desired the agency (rather than the courts)

to possess whatever degree of discretion the ambiguity

2. The United States has no claim to Chevron deference

here. To be conceivably eligible for such deference, DHS would

have needed to engaged in notice-and-comment before issuing

DAPA. See Nat'l Min. Ass'n v. McCarthy, 758 F.3d 243, 251 (D.C.

Cir. 2014) (citations omitted). That failure thus not only violated

the APA, it rendered Chevron deference unavailable. Even if

DHS had complied with the APA, however, judicial deference to

its interpretation of the Immigration and Nationality Act would

have been inappropriate in any event. See Brief for Respondents

(“Resp. Br.”) 44.

9

allows.” Smiley v. Citibank (South Dakota), N.A., 517

U.S. 735, 740-41 (1996). But that is difficult to reconcile

with the principle that “the judicial power, as originally

understood, requires a court to exercise its independent

judgment in interpreting and expounding upon the

laws.” Perez, 135 S. Ct. at 1217 (Thomas, J., concurring).

It would be untenable, for example, to suggest that it is

compatible with Article III for a federal court to defer to

the Department of Justice’s interpretation of a criminal

statute that it enforces. See Crandon v. United States,

494 U.S. 152, 177 (1990) (Scalia, J., concuring). Yet an

agency’s resolution of an equally significant statutory

question will routinely be the final word—even when the

agency’s officials are not answerable to the President. See

Humphrey’s Ex’r v. United States, 295 U.S. 602 (1935).

For these reasons, and others, agencies are rightly

called “the ‘headless fourth branch of government,’

reflecting not only the scope of their authority but their

practical independence.” City of Arlington, Tex., 133 S.

Ct. at 1878 (Roberts, C.J., dissenting). Agencies issue,

interpret, and enforce the rules that govern our lives;

“as a practical matter they exercise legislative power, by

promulgating regulations with the force of law; executive

power, by policing compliance with those regulations;

and judicial power, by adjudicating enforcement actions

and imposing sanctions on those found to have violated

their rules.” Jd. at 1877-88. The authority agencies have

accumulated over time is startling. “It would be a bit

much to describe the result as ‘the very definition of

tyranny, but the danger posed by the growing power of

the administrative state cannot be dismissed.” Jd. at 1879

(citation omitted).

10

The hazard agencies pose to the democratic process

was not lost on Congress. “Concern over administrative

impartiality and response to growing discontent was

reflected in Congress as early as 1929 .... Fears and

dissatisfactions increased as tribunals grew in number

and jurisdiction, and a succession of bills offering various

remedies appeared in Congress.” Wong Yang Sung

v. McGrath, 339 U.S. 33, 37-38 (1950). These efforts

culminated in the APA. The law was then, and is today,

“a ‘working compromise, in which broad delegations of

discretion were tolerated as long as they were checked

by extensive procedural safeguards.” Fox Television

Stations, 556 U.S. at 537 (Kennedy, J., concurring in

part and concurring in the judgment) (quoting Richard

B. Stewart & Cass R. Sunstein, Public Programs and

Private Rights, 95 Harv. L. Rev. 1193, 1248 (1982)).

The APA’s chief procedural safeguard, Section 553,

requires administrative agencies to provide “notice of

proposed rulemaking” and “give interested persons an

opportunity to participate in the rulemaking through

submission of written data, views, or arguments with

or without opportunity for oral presentation.” 5 U.S.C.

§ 553(b)-(c). Congress understood that, if agencies were

going to wield legislative power, their procedures must be

“adapted to giving adequate opportunity to all persons

affected to present their views, the facts within their

knowledge, and the dangers and benefits of alternative

courses.” S. Doc. No. 77-8, Administrative Procedures in

Government Agencies, at 102 (1941). Furthermore, those

procedures were “likely to be diffused and of little real

value either to the participating parties or to the agency,

unless their subject matter is indicated in advance.” Jd.

at 108. Public notice and comment, in short, was seen as

1]

“essential in order to permit administrative agencies to

inform themselves and to afford adequate safeguards to

private interests.” Jd.

Congress’s recognition of public participation as

vital was not the product of generic concern over agency

abuse. Congress saw notice-and-comment rulemaking

as advancing concrete objectives. First, it restores at

least some measure of democratic legitimacy to agency

action. Section 553 “reintroduce[s] public participation and

fairness to affected parties after governmental authority

has been delegated to unrepresentative agencies.”

Batterton v. Marshall, 648 F.2d 694, 703 (D.C. Cir.

1980); H.R. Rep. No. 79-1980, at 257 (1946). “Notice and

comment is the procedure by which the persons affected

by legislative rules are enabled to communicate their

concerns in a comprehensive and systematic fashion to

the legislating agency.” Hoctor v. U.S. Dep't of Agric., 82

F.3d 165, 171 (7th Cir. 1996).

Second, notice-and-comment rulemaking helps to

secure consent of the governed: “public participation in

agency decisionmaking is more democratic and increases

the legitimacy of agency decisions and public trust in the

agencies.” Stephen M. Johnson, Good Guidance, Good

Grief!, 72 Mo. L. Rev. 695, 735 (2007). Legal regimes are

more likely to endure if aggrieved parties believe that

they had an adequate opportunity to voice objections

and that the disappointing result was the product of a

fair fight. Popular acceptance of agency rules, in other

words, depends on the “legitimacy that comes with

following the APA-mandated procedures for creating

binding legal obligations.” Shands Jacksonville Med.

Ctr. v. Burwell, --- F. Supp. 3d ---, No. 14-1477, 2015

12

WL 5579653, at *21 (D.D.C. Sept. 21, 2015). Notice-and-

comment rulemaking “opens the process to groups and

individuals with discordant points of view who might

otherwise not have been heard during an agency’s routine

process of consultation with the public.” Michael Asimow,

Nonlegislative Rulemaking and Regulatory Reform,

1985 Duke L.J. 381, 402 (1985).

Third, wide dissemination of proposed rules holds

agency heads accountable to Congress and the public for

how they discharge their office. “Agency accountability

is an important component under any of these theories

of the administrative state’s legitimacy.” Nina A.

Mendelson, Regulatory Beneficiaries and Informal

Agency Policymaking, 92 Cornell L. Rev. 397, 418 (2007).

We cannot hold the regulators accountable if we do not

know what the regulators are up to. After all, “the law

must provide that the governors shall be governed and

the regulators shall be regulated, if our present form of

government is to endure.” S. Doc. No. 248, 79th Cong., 2d

Sess. 244 (1946).

Fourth, the APA’s notice-and-comment obligation

fosters predictability and stability in the administrative

arena. The process forces the agency to take a definitive

position on the matter, which, in turn, provides affected

parties with certainty as to how to conform their conduct

to the law. See Nat'l Family Planning & Reprod. Health

Ass'n, Inc. v. Sullivan, 979 F.2d 227, 231 (D.C. Cir. 1992).

“At a minimum, it allows affected parties, who participate

in the formulation of the rule, to anticipate the rule

and plan accordingly.” Lisa Schultz Bressman, Beyond

Accountability: Arbitrariness and Legitimacy in the

Administrative State, 78 N.Y.U. L. Rev. 461, 542 (2003).

13

Otherwise, affected parties must make it “their business

(or their counsel’s) to anticipate and guard against all

possibilities.” Robert A. Anthony, /nterpretive Rules,

Policy Statements, Guidances, Manuals, and the Like-

Should Federal Agencies Use Them to Bind the Public?,

41 Duke L.J. 1311, 1376 (1992). If agencies are going to

fill “gaps” left by Congress in federal statutes, they must

follow the procedures that give the public fair warning of

what is required. “Citizens should be able to know what

conduct is permitted or prohibited by an agency rule.” 3

Richard J. Pierce, Jr., Administrative Law Treatise § 6.8

(5th ed. 2010).

The process also establishes a legislative baseline

against which future agency action in that area will be

measured. Although an agency may reverse course, it

must give a “reasoned explanation” for doing so. Fox

Television Stations, 556 U.S. at 515. As a result, an

agency must engage in notice-and-comment rulemaking

to alter a legislative rule. See 5 U.S.C. § 551(5); see also

Homemakers N. Shore, Inc. v. Bowen, 832 F.2d 408, 412

(7th Cir. 1987); Asimow, supra, at 396. By committing

agencies to notice and comment where reliance interests

are squarely implicated, the APA ensures that those who

have accommodated themselves to the existing rule will

not have the rug pulled out from under them without the

chance to be heard. See Fox Television Stations, 556 U.S.

at 536 (Kennedy, J., concurring in part and concurring in

the judgment).

Fifth, and last, notice-and-comment rulemaking

produces superior legal rules. A key benefit of affording

notice and comment “is to allow the agency to benefit from

the expertise and input of the parties who file comments

14

with regard to the proposed rule.” Nat'l Tour Brokers

Ass'n v. United States, 591 F.2d 896, 902 (D.C. Cir. 1978). It

“educates the agency, thereby helping to ensure informed

agency decisionmaking.” Chocolate Mfrs. Ass’n of U.S. v.

Block, 755 F.2d 1098, 1103 (4th Cir. 1985); see also John F.

Manning, Nonlegislative Rules, 72 Geo. Wash. L. Rev. 893,

904 (2004) (“[ N Jotice-and-comment rulemaking improves

the quality of agency decisionmaking by mobilizing the

whole spectrum of interested parties to direct arguments,

information, and criticism to the agency.”). More often

than not, agencies will lack an appreciation for legal

vulnerabilities, will use a sledgehammer when a scalpel

will do, and will fail to adequately account for real-world

consequences when they leap before they look.

II. DAPA Is Invalid Because It Did Not Go Through

Notice And Comment In Accordance With The APA.

In light of the importance of notice-and-comment

rulemaking, the United States’ reliance on the APA’s

“general statements of policy” exception is indefensible.

Section 553’s exceptions must be construed narrowly so as

not to defeat the provision’s fundamental purpose. To that

end, the lower courts broadly agree that this exception

applies only when the rule is tentative and thus non-

binding on the agency itself. As the district court found,

however, DAPA is binding on DHS. That factual finding

not only easily withstands clear-error review; the record

shows that it is definitively correct.

15

A. The APA’s Exceptions To Notice-And-Comment

Rulemaking Are Narrowly Construed.

Section 553’s notice-and-comment requirement

applies to “rule making,” which the APA defines as the

process of “formulating, amending or repealing a rule.”

5 U.S.C. § 551(5). The statute, in turn, broadly defines a

“rule” to include “statement(s] of general or particular

applicability and future effect designed to implement,

interpret, or prescribe law or policy or describing the

organization, procedure, or practice requirements of an

agency.” Jd. § 551(4). The United States does not dispute

that DAPA is a “rule” as the APA employs that term. Pet.

App. 54a, n.122.

The United States argues instead that DAPA,

although a rule, is exempt from notice-and-comment “rule

making” procedures. In particular, Section 553 provides

that the notice-and-comment requirement does not apply

to (1) “interpretative rules”; (2) “general statements of

policy”; and (3) “rules of agency organization, procedure,

or practice.” 5 U.S.C. § 553(b)(8)(A). The United States

defends DAPA as—and only as—a “general statement of

policy.” Pet. Br. 65. Unless this exception applies, DAPA

violates the APA.

There are many problems with the United States’

reliance on this exception. Most importantly, the United

States ignores that Section 553’s exceptions must be

construed narrowly. Resp. Br. 60-61. The APA’s legislative

history is “scattered with warnings that various of the

exceptions are not to be used to escape the requirements

of section 553.” Am. Bus Ass'n v. United States, 627 F.2d

525, 528 (D.C. Cir. 1980) (citing S. Doe. No. 248, 79th

16

Cong., 2d Sess. 19, 199, 258 (1946)); see Nat’l Nutritional

Foods Ass'n v. Kennedy, 572 F.2d 377, 384 (2d Cir. 1978)

(“The legislative history of the [APA] demonstrates that

Congress intended the exceptions in § 553(b)(B) to be

narrow ones.”) (citing S. Rep. No. 752, 79th Cong. Ist

Sess. (1945)). For that reason, “judicial review of a rule

promulgated under an exception to the APA’s notice-

and-comment requirement must be guided by Congress’s

expectation that such exceptions will be narrowly

construed.” State of N.J., Dep’t of Envtl. Prot. v. U.S.

Envtl. Prot. Agency, 626 F.2d 1038, 1045 (D.C. Cir. 1980);

see also Am. Hosp. Ass'n v. Bowen, 834 F.2d 1037, 1044-45

(D.C. Cir. 1987); Profls & Patients for Customized Care

v. Shalala, 56 F.3d 592, 595 (5th Cir. 1995).

“In enacting the APA, Congress made a judgment

that notions of fairness and informed administrative

decisionmaking require that agency decisions be made

only after affording interested persons notice and an

opportunity to comment.” Chrysler Corp. v. Brown, 441

U.S. 281, 316 (1979). Indeed, Congress “was alert to the

possibility that these exceptions might, if broadly defined

and indiscriminately used, defeat the section’s purpose.”

Am. Bus Ass'n, 627 F.2d at 528. Notice-and-comment

procedures cannot bolster the administrative state’s

legitimacy if they are subject to broad carve-outs. See

Nat'l Ass'n of Home Health Agencies v. Schweiker, 690

F.2d 932, 949 (D.C. Cir. 1982) (“Exceptions to the notice

and comment provisions of § 553 are to be recognized

only reluctantly. Otherwise, the salutory purposes

behind the provisions would be defeated.”). Put simply,

the three “exceptions itemized in Section 553” cannot

be permitted “to swallow the APA’s well-intentioned

directive.” Sullivan, 979 F.2d at 240 (citation omitted); see

17

Alcaraz v. Block, 746 F.2d 593, 612 (9th Cir. 1984) (“The

exceptions to section 553 will be narrow'y construed and

only reluctantly countenanced.”) (citation and quotations

omitted). If given the latitude, agencies will deploy them

“to circumvent the notice and comment requirements

whenever” it is “inconvenient to follow them.” U.S. Steel

Corp. v. EPA, 595 F.2d 207, 214 (5th Cir. 1979).

After all, it is no coincidence that the rules subject

to notice and comment are “legislative” and those that

are not are deemed “nonlegislative.” Gen. Motors Corp.

v. Ruckelshaus, 742 F.2d 1561, 1565 (D.C. Cir. 1984). A

rule is “legislative” if it “supplements a statute, adopts

a new position inconsistent with existing regulations, or

otherwise effects a substantive change in existing law or

policy.” Mendoza v. Perez, 754 F.3d 1002, 1021 (D.C. Cir.

2014). Such rules require notice and comment because that

process “improves the quality of agency rulemaking by

exposing regulations to diverse public comment, ensures

fairness to affected parties, and provides a well-developed

record that enhances the quality of judicial review.” Sprint

Corp. v. FCC, 315 F.3d 369, 373 (D.C. Cir. 2003) (citations

omitted).

Nonlegislative rules, in contrast, “merely express |]

an agency’s interpretation, policy, or internal practice

or procedure .... They express the agency’s intended

course of action, its tentative view of the meaning of a

particular statutory term, or internal house-keeping

measures organizing agency activities.” Batterton, 648

F.2d at 702. Section 553’s exceptions “have a common

theme in that they accommodate situations where the

policies promoted by public participation in rulemaking

are outweighed by the countervailing considerations

18

of effectiveness, efficiency, expedition and reduction in

expense.” Am. Hosp. Ass’n, 834 F.2d at 1045 (citation and

quotations omitted).

At base, Congress created these narrow exceptions

“to preserve agency flexibility in dealing with limited

situations where substantive rights are not at stake.”

Id. “Exemptions” therefore “should be recognized only

where the need for public participation is overcome by

good cause to suspend it, or where the need is too small to

warrant it, as for example, when the action in fact does not

conclusively bind the agency, the court, or affected private

parties.” Batterton, 648 F.2d at 704. They are not a license

to make “important policy judgments [outside of] the more

formal deliberative processes that produce legislation or

legislative rules.” Manning, supra, 917. That would violate

the bargain struck in the APA. See supra at 6-14.

B. A Rule Is Not A “General Statement Of Policy”

If Its Binds The Agency.

The United States’ defense of DAPA as a “general

statement of policy” cannot be reconciled with the need

to construe Section 553’s exceptions narrowly. According

to the United States, an agency document is a “general

statement of policy” as long as it does not “create legally

enforceable rights or obligations in regulated parties.”

Pet. Br. 65. In so arguing, the United States promotes a

definition so broad as to swallow the APA’s notice-and-

comment requirement. A construction of this exception

that would permit agencies to issue major substantive

policies without public participation, as this one clearly

would, is untenable.

19

It should come as no surprise, then, that this

proposed test for determining whether an agency rule

is a “general statement of policy” finds no legal support.

Indeed, the United States is unable to cite any judicial

authority for this proposition. Resp. Br. 68-71. Its amici

can do no better, relying solely on two cases dealing with

interpretive rules, not general statements of policy. See

Amicus Brief of Administrative Law Scholars (“Admin.

Br.”) 8-9 n.5.

The reason why the United States and its amici

can find no support for their position is because courts

uniformly agree that the “primary distinction between

a substantive rule ... and a general statement of policy

... turns on whether an agency intends to bind itself

to a particular legal position.” Molycorp, Inc. v. EPA,

197 F.3d 543, 546 (D.C. Cir. 1999) (citation omitted)

(emphasis added); see also Guardian Fed. Sav. & Loan

Ass'n v. FSLIC, 589 F.2d 658, 666-67 (D.C. Cir. 1978).

“The significance” of whether the policy is binding on

the agency “is that it reveals whether, if objections to

the rule cannot be voiced through notice and comment

rulemaking at the time of promulgation, there will be a

subsequent opportunity to object to a specific application

of the rule. If an agency, or its official, is bound to apply an

airtight rule in a given case it is important to allow specific

objections prior to promulgation, lest these objections be

forfeited.” Jean v. Nelson, 711 F.2d 1455, 1481-82 (11th Cir.

1983). “The ultimate concern,” in other words, “is that the

agency, despite its announced policy, be free to consider

on their facts the cases that arise, without constraint of

the ‘policy.”” Id. at 1455 n.22 (emphasis added).

20

More fundamentally, if the purported statement

of policy is binding, it has the “force and effect of law.”

Chrysler Corp., 441 U.S. at 295. And, “if an agency rule

could make legally binding policy without going through”

the “formalities” of notice-and-comment rulemaking,

it lacks “incentive ... to invoke the more cumbersome

procedures.” Manning, supra, 918. That is why “Congress

contemplates administrative action with the effect of law

when it provides for a relatively formal administrative

procedure tending to foster the fairness and deliberation

that should underlie a pronouncement of such force.”

United States v. Mead Corp., 533 U.S. 218, 230 (2001).

Whether an agency statement is a legislative rule thus

“hinges quite directly on the agency’s intention ... to bind

either itself or the public.” Manning, supra, 918; see also

USTA v. FCC, 28 F.3d 1232, 1234 (D.C. Cir. 1994).

Determining whether the rule is “binding” must, in

turn, focus on whether it “genuinely leaves the agency and

its decisionmakers free to exercise discretion.” McLouth

Steel Prods. Corp. v. Thomas, 838 F.2d 1317, 1320 (D.C.

Cir. 1988). An agency statement retaining such discretion

genuinely is an “announcement of [a] general policy which

the [agency] hopes to establish in subsequent proceedings,”

Am. Bus Ass’n, 627 F.2d at 529, or a “tentative intention| |

for the future,” Pac. Gas & Elec. Co. v. FPC, 506 F.2d 33,

38 (D.C. Cir. 1974). If the statement eliminates discretion,

however, then it is a “binding norm,” Am. Bus. Ass’n, 627

F.2d at 529, which is “finally determinative of the issues or

rights to which it is addressed,” Pac. Gas, 506 F.2d at 38.°

3. Some courts have held that agency pronouncements

also qualify as legislative rules if they “impose ... rights and

obligations,” Cmty. Nutrition Inst. v. Young, 818 F.2d 943, 946

21

“If it appears that a so-called policy statement is

in purpose or likely effect one that narrowly limits

administrative discretion,” then, “it will be taken for what

it is—a binding rule of substantive law.” Guardian Fed.

Sav. & Loan Ass’n, 589 F.2d at 666-67. “If a document

expresses a change in substantive law or policy (that

is not an interpretation) which the agency intends to

make binding, or administers with binding effect, the

agency may not rely upon the statutory exemption for

policy statements, but must observe the APA’s legislative

rulemaking procedures.” Gen. Elec. Co. v. EPA, 290 F.3d

377, 382 (D.C. Cir. 2002) (citation and quotations omitted).

Courts examine the rule’s purpose because “{i]f

the document is couched ... in terms indicating that it

will be regularly applied, a binding intent is strongly

evidenced.” /d. (citation and quotations omitted). Again,

the key question is whether the challenged policy “leaves

the agency free to exercise its discretion to follow or

not to follow that general policy in an individual case,”

or, instead, whether it “so fills out the statutory scheme

that upon application one need only determine whether a

given case is within the rule’s criteria.” Shalala, 56 F.3d

at 596-97.

& n.4 (D.C. Cir. 1987), while others believe that this inquiry

is subsumed within the binding/non-binding framework, see

McLouth Steel Prods. Corp., 838 F.2d at 1320 (“If a statement

denies the decisionmaker discretion in the area of its coverage,

so that he, she or they will automatically decline to entertain

challenges to the statement’s position, then the statement is

binding, and creates rights or obligations, in the sense those

terms are used in Community Nutrition.”). Because DAPA is

a legislative rule under either formulation, Resp. Br. 61-62, the

Court need not resolve this issue.

22

Courts also examine the policy’s effect because it

can reveal, as in other areas of the law, the agency’s true

intent. See Lewis-Mota v. Secretary of Labor, 469 F.2d

478, 482 (D.C. Cir. 1972) (“[T he label that the particular

agency puts upon its given exercise of administrative

power is not, for [these] purposes, conclusive; rather it is

what the agency does in fact.”). “If an agency acts as if

a document issued at headquarters is controlling in the

field,” if it “treats the document in the same manner as

it treats a legislative rule,” or if it “bases enforcement

actions on the policies or interpretations formulated in

the document,” then the statement “is for all practical

purposes ‘binding.” Appalachian Power Co. v. EPA, 208

F.3d 1015, 1021 (D.C. Cir. 2000); see also Manning, supra,

918.

The United States offers two responses—neither of

which is persuasive. First, the United States claims “it

is irrelevant whether a statement of policy regarding

the exercise of enforcement discretion also allows rank-

and-file agents to be more aggressive in enforcement for

case-specific reasons” because “[a] blanket policy is still

a ‘policy.” Pet. Br. 69 (citing Black’s Law Dictionary 1345

(10th ed. 2014)). But that argument is facially circular.

Of course DAPA is a “policy.” But the APA’s notice-and-

comment requirement covers policies no less than other

forms of agency action. The issue is whether DAPA is

“designed to implement, interpret, or prescribe law or

policy,” 15 U.S.C. § 551(4), or is “a general statement of

policy,” id. § 553(b)(8)(A). And, as explained, that turns

on whether the policy does or does not bind the agency.

Whether DAPA binds “rank-and-file agents” obviously

bears heavily on that inquiry. The United States thus is

quite correct that a blanket policy is still a policy. It is just

23

that DAPA’s “blanket” nature makes this policy subject

to notice-and-comment rulemaking.

Second, the United States claims that focusing on

whether DAPA is binding “create[s] horrible incentives”

by “prohibiting senior officials from announcing policies

that bind rank-and-file agents, without first following

notice-and-comment procedures.” Pet. Br. 71. But the

United States ignores that Section 553’s exemption for

“rule[s] of agency organization, procedure and practice,”

5 U.S.C. § 553(b)(8)(A), accommodates this concern. It

does so for the reason the United States identifies. If the

policy is truly about internal operations, agencies should

“retain latitude in organizing their internal operations.”

Mendoza, 754 F.3d at 1023.

But to fall within this category, the policy must impose

only “derivative,” “incidental,” or “mechanical” burdens

upon regulated individuals. See Neighborhood TV Co. v.

FCC, 742 F.2d 629, 637 (D.C. Cir. 1984). If it “encodes a

substantive value judgment(,] puts a stamp of approval or

disapproval on a given type of behavior,” Am. Hosp., 834

F.2d at 1047, or “change[s] the substantive standards by

which the [agency] evaluates” applications, JEM Broad.

Co. v. FCC, 22 F.3d 320, 327 (D.C. Cir. 1994), it will be

considered a legislative rule. It seems clear, then, why

the United States does not rely on this exception. But the

fact that DAPA cannot meet this test, see infra at 24-27,

does not entitle the United States to expand a different

exception in order to solve DHS’s notice-and-comment

problem.

24

C. DAPA Is Not A “General Statement Of Policy.”

Under the proper test, there is no question that

DAPA is a legislative rule for which notice and comment

was required. To begin, DAPA’s purpose is to formulate

a “statutory scheme [so] that upon application one need

only determine whether a given case is within the rule’s

criteria.” Shalala, 56 F.3d at 596-97. As the district court

found, DAPA’s “‘guidelines’ are in fact requirements to be

accepted under these programs.” Pet. App. 383a. “[{I]t is

clear from the record that the only discretion that has been

or will be exercised is that already exercised by Secretary

Johnson in enacting the DAPA program and establishing

the criteria therein.” Pet. App. 386a.

At a bare minimum, DAPA “severely restricts” any

discretion agency officials possess. Pet. App. 386a. No

more is required to uphold the judgment below. See, e.g.,

USTA, 38 F.3d at 1234 (“It is rather hard to imagine an

agency wishing to publish such an exhaustive framework

for sanctions if it did not intend to use that framework to

cabin its discretion.”); Pickus v. U.S. Bd. of Parole, 507

F.2d 1107, 1113 (D.C. Cir. 1974) (holding that “the rules

which define parole selection criteria, new and old, are

substantive agency action, for they define a fairly tight

framework to circumscribe the Board’s statutorily broad

power”).

DAPA’s binding effect is also apparent given the

way in which DHS implemented DACA—a predecessor

and related immigration policy. Resp. Br. 63-65. DAPA’s

“plain language” indicates “that DACA and DAPA would

be applied similarly.” Pet. App. 61a n.139. Secretary

Johnson “direct{ed] USCIS to establish a process, similar

25

to DACA.” Pet. App. 416a (emphasis added). DACA and

DAPA also use similar legislative criteria. It therefore

was entirely appropriate for the district court to examine

how DHS had implemented DACA to predict (at the

preliminary-injunction stage) how DHS likely would

implement DAPA. See, e.g., Valle Del Sol Inc. v. Whiting,

709 F.3d 808, 827 n.5 (9th Cir. 2013) (“We reiterate that

we consider only the limited record before us and only as

a predictive matter at the preliminary injunction stage.

Nothing in our opinion should be read as foreclosing the

parties from introducing additional evidence as this case

proceeds.”).

The district court found that DACA had been applied

mechanically. Pet. App. 56a n.130. Specifically, the district

court found few denials (about five percent of 723,000

applications). Pet. App. 136a & n.44. Of those, the United

States could not identify any discretionary denials. Pet.

App. 56a-57a & n.130. Even if a few had occurred (despite

all evidence to the contrary), moreover, that still would not

show that DAPA was a general statement of policy. See,

e.g., Gen. Elec. Co, 290 F.3d at 382; Resp. Br. 63.

The United States nevertheless claims that DAPA is

not “binding” because DHS “remains free to modify or

revoke the [policy] in [its] discretion.” Pet. Br. 67. But, for

understandable reasons, an agency's pronouncement that

“it does not consider itself ... bound by [a rule] is obviously

of little weight.” McLouth Steel Prods. Corp, 838 F.2d at

1320. The policy’s “substance and effect will determine

whether a rule is a ‘general statement of policy.” Guardian

Federal Sav. & Loan Ass'n, 589 F.2d at 666-67.

26

For similar reasons, the United States cannot rely

on boilerplate language that DAPA implements “new

policies,” “confers no substantive right,” and is “an

exercise of prosecutorial discretion.” Pet. App. 412a, 419a.

The district court rightly rejected such disclaimers as

“disingenuous” and “contrary to the substance of DAPA.”

Pet. App. 382a; see, e.g., Jowa League of Cities v. EPA,

711 F.3d 844, 865 (8th Cir. 2013) (rejecting an agency’s

“pro forma reference to ... discretion” as “Orwellian

newspeak”).

That the United States claims that DHS remains

free to “deny deferred action as to any individual under

this policy, other policies, or under no policy at all, in

[its] discretion,” Pet. Br. 67, is just further evidence of

regulatory gamesmanship. DAPA’s stated purpose was

to “encourage {unauthorized aliens] to come out of the

shadows, submit to background checks, pay fees, apply

for work authorization ... and be counted.” Pet. App.

415a. An unauthorized alien, who meets DAPA’s criteria

and accepts this invitation “to come out of the shadows,”

would be justifiably outraged to learn that he was, in

fact, being deported because DHS “remains free ... to

pursue removal, in [its] discretion.” Pet. Br. 67. These

are precisely the type of “ad hoc determinations” that

notice-and-comment rulemaking avoids. Morton v. Ruiz,

415 U.S. 199 (1974).

In the end, this case is no different from Morton v.

Ruiz. Resp. Br. 67. There, the Bureau of Indian Affairs

created “classifications and eligibility requirements” for

Indian welfare assistance through a policy manual that

did not receive notice and comment. The Court rejected

this attempt to circumvent the APA. An agency’s power

27

“to make rules that affect substantial individual rights and

obligations carries with it the responsibility not only to

remain consistent with the governing legislation, but also

to employ procedures that conform to the law.” Morton,

415 U.S. at 232 (citing NLRB v. Wyman-Gordon Co., 394

U.S. 759, 764 (1969)). The BIA “presented no reason why

the requirements of the [APA] could not or should not have

been met.” Jd. at 236. BIA’s “conscious choice” not “to

treat this extremely significant eligibility requirement,

affecting rights of needy Indians, as a legislative-type

rule, renderfed] it ineffective.” Jd. at 236.

So too here. DAPA represents a massive change in

immigration policy. This is exactly the type of significant

change for which notice-and-comment rulemaking was

intended. See id.; see also Hoctor, 82 F.3d at 171 (“The

greater the public interest in a rule the greater reason

to allow the public to participate in its formation.”). Even

supporters of such immigration policies, and the need

for them to be solved administratively, recognize the

need for public input on this subject. See, e.g., Cristina

M. Rodriguez, Constraint Through Delegation: The

Case of Executive Control Over Immigration Policy, 59

Duke L.J. 1787, 1794 (2010) (acknowledging that “even

if effective policymaking requires some insulation from

political pressures, the regime ultimately must respond to

public views concerning acceptable levels of immigration,

for reasons of democratic legitimacy in and of itself, as

well as to nurture public confidence in government and

acceptance of immigration over time”). Yet DHS offered

the public and those affected by DAPA (including States

such as Texas) no opportunity to comment before it was

implemented.

28

III. This Administration Has Habitually Ignored The

Notice-And-Comment Requirement Of The APA.

The United States gives short shrift to the notice-

and-comment issue, focusing far more attention on other

matters. That may be because, for the reasons set forth

above, the United States is having trouble mounting a

defense on this score. It may, though, be attributable to

an assumption that DAPA is too prominent a program to

be enjoined because of a procedural violation. If that is

the case, the need for the Court’s intervention is all the

more urgent. Agencies must be disabused of any notion

that the APA’s procedural requirements are ministerial.

An agency’s failure to put a proposed rule out for notice

and comment is no trivial violation. As explained above,

“advance notice and opportunity for public participation

are vital if a semblance of democracy is to survive in this

regulatory era.” Chamber of Commerce v. Occupational

Safety & Health Admin., 636 F.2d 464, 471 (D.C. Cir. 1980)

(Bazelon, J., concurring).

Unfortunately, faithful compliance with the APA’s

notice-and-comment requirement is a recurring problem

for this Administration. Time and again, since 2008, the

Administration has come up with creative justifications for

why notice and comment was not required. The problem

is not limited to one official, one agency, or one issue; it is

systematic throughout the Executive Branch. Examples

are myriad:

The Transportation Security Administration, in 2010,

began using advanced imaging technology (“AIT”) to

screen airline passengers at airports. AIT produced an

image of an unclothed person and enabled the operator

29

to detect a nonmetallic object. Agreeing with the privacy-

rights plaintiffs, the district court concluded that the

agency “had advanced no justification for having failed

to conduct a notice-and-comment rulemaking.” EPIC v.

DHS, 653 F.3d 1 (D.C. Cir. 2011). As the court explained,

“the changes substantively affect the public to a degree

sufficient to implicate the policy interests animating

notice-and-comment rulemaking. Indeed, few if any

regulatory procedures impose directly and significantly

upon so many members of the public. Not surprisingly,

therefore, much public concern and media coverage have

been focused upon issues of privacy, safety, and efficacy,

each of which no doubt would have been the subject of

many comments had the TSA seen fit to solicit comments

upon a proposal to use AIT for primary screening.” /d. at

319. The rule was vacated.

In 2012, the Department of Transportation issued

a memorandum announcing that it would not apply the

“Buy America” policy (a statutory requirement that steel

or iron used in federally-funded highways be sourced

from within the United States) to two specific categories

of steel and iron products. Unions and other associations

sued, arguing that the memorandum was a legislative

rule. The district court agreed. The court noted that its

decision “should not be construed as a criticism of the

substance of the [memorandum] in adopting it. Indeed, [it]

seems quite sensible. But even when an agency adopts a

sensible rule it must follow proper procedures. Defendants

failed to do so here.” United Steel v. Federal Highway

Administration, 2015 WL 9412105, at *15 (D.D.C. 2015).

The rule was vacated.

30

In 2012, the Environmental Protection Agency

promulgated an interim rule to permit manufacturers

of heavy-duty diesel engines to pay certain penalties in

exchange for the ability to sell noncompliant engines.

Manufacturers of compliant heavy-duty diesel engines

challenged the rule on notice-and-comment grounds.

The D.C. Circuit agreed. In so ruling, the court “strongly

reject(ed)] EPA’s claim that the challenged errors [were]

harmless simply because of the pendency of a properly-

noticed final rule. Were that true, agencies would have no

use for the APA when promulgating any interim rules.

So long as the agency eventually opened a final rule for

comment every error in every interim rule—no matter

how egregious—could be excused as harmless error.”

Mack Trucks, Inc. v. EPA, 682 F.3d 87, 95 (D.C. Cir. 2012).

The rule was vacated.

The Department of Labor, in 2011, issued two

“Training and Employment Guidance Letters” setting

the wages and working conditions that employers had

to offer American animal herders before hiring foreign

herders. These DOL letters were issued without notice and

comment. American workers sued, “paint[ing] a portrait

of agency capture” and arguing that the agency had failed

to give “herders or their representatives an opportunity

to be heard.” Mendoza, 754 F.3d at 1007. The D.C. Circuit

agreed, vacating the letters because they were “legislative

rules [that] effect(ed] a substantive change in existing

law or policy and effectively amend[ed] a prior legislative

rule.” Jd. at 1024.

In 2013, the Federal Communications Commission

issued, without notice and comment, reimbursement

rules for telecommunications relay services. A provider

31

of such services challenged the rules, arguing that the

FCC lacked “good cause” to bypass notice and comment.

The D.C. Circuit again agreed, holding that the agency’s

assertion of an impending “fiscal calamity” as the basis

for bypassing the APA’s notice-and-comment command

was an “unsupported assertion” that “[IJack[ed] record

support.” Sorenson Commce’ns Inc. v. FCC, 755 F.3d 702,

707 (D.C. Cir. 2014). Those rules were vacated too.

The list goes on and on. See, e.g., City of Idaho Falls,

Idaho v. Fed. Energy Reg. Comm'n, 629 F.3d 222 (D.C.

Cir. 2011); FBME Bank Ltd. v. Lew, --- F. Supp. 3d ---, No.

15-01270, 2015 WL 5081209 (D.D.C. 2015); Mid Continent

Nail Corp. v. United States, 999 F. Supp. 2d 1307 (Ct. Int’]

Trade 2014); see also The Fourth Branch & Underground

Regulations, NFIB Small Business Legal Center 9-34

(Sept. 2015), http://goo.gl/t2ilo7 (identifying numerous

“underground regulations” that were “adopted under

the radar, without going through a notice-and-comment

process, and impose substantive burdens on the regulated

community”). Almost all of these cases are the same: the

Administration claims a critical rule is needed—whether

in transportation, the environment, communications,

or elsewhere—and, as a result, notice-and-comment

requirements must yield to an important policy initiative.

Nowhere has the Administration’s allergy to

notice and comment been more prevalent than in its

implementation of the Affordable Care Act. “One of the

hallmarks of Obamacare has been the sudden, ad hoc

modifications of the law, outside the notice and comment

process, through a series of executive memorandum, blog

posts, and even ... FAQs.” Josh Blackman, Regulation

by Blog Post: DDC Enjoins HHS From Implementing

32

Website FAQ, http://goo.gl/t9KtNn; see also Zachary

S. Price, Enforcement Discretion & Executive Duty,

67 Vand. L. Rev. 671, 749-54 (2014) (documenting the

Administration’s non-enforcement of key provisions of

the Affordable Care Act). This “regulation by blog post,”

has allowed the Administration to engage in “ad-hoc

lawmaking that affects millions of people and billions of

dollars.” Blackman, supra. Not surprisingly, without the

benefit of public participation, “the government has been

spending too much money, bestowing unappropriated

benefits, and waiving mandates.” /d.

* * *

“(T]he role and position of the agency, and the exact

locus of its powers, present questions that are delicate,

subtle, and complex.” Fox Television Stations, 556 U.S. at

536 (Kennedy, J. concurring in part and concurring in the

judgment). Agencies should heed this legitimate concern

and conduct their business in a way that maximizes public

participation. But that has not been the Administration’s

response. Far too often, it has viewed administrative

procedural requirements merely as obstacles to be

circumvented instead of as essential to vindicating the

democratic principles of fair warning and the right to

be heard. That is disappointing. Notice-and-comment

rulemaking under Section 553 is a cornerstone of the APA.

It must be enforced.

33

CONCLUSION

The judgment of the court of appeals should be

affirmed.

Respectfully submitted,

KAREN R. HARNED WILLIAM S. Consovoy

NFIB SMALL BusINEss Counsel of Record

LEGAL CENTER J. MICHAEL CONNOLLY

1201 F Street, NW, Suite 200 Consovoy McCartuy

Washington, DC 20004 ParK PLLC

(202) 314-5048 3033 Wilson Blvd., Suite 700

Arlington, Virginia 22201

(703) 243-9423

will@consovoymccarthy.com

April 4, 2016