violates the fair labor standards act the legal consequence of the letter is to place realigning in jeopardy of civil monetary penalties if realign it does not comply the question is whether the agency can force a hobson's choice on what they were determination letter changes really changes a couple of things one is it takes the fair labor standards act and applies it to the particular facts of the take your business is this court's cases going all the way back to nationalism automatic  hold when there is an ambiguity about whether a statute or how a statute applies to a particular party's business model in that situation price or obligation does is that your argument i'm sorry isn't that doesn't citing bennett says there's two ways one is a legal obligation and the other is the legal consequences that flow that's correct o sakit the legal obligation is the one that judge edwards mention i'm just reading by reason of the order of the sac as have the legal obligation to restore their property they were ordered to restore their property you don't have that there's no order direct so why why do we need to discuss the question of whether the order of the letter actually orders you to do so as long as it has a legal consequences that you've been talking about namely the risk of willfulness penalties your honor you're entirely correct that's the way then it works and our contention has always been that we succeed under both traits here if bennett but you're entirely correct your honor that even if you disagree that there is any that there's any order to comply in the  determination letter here at the very least what the determination letter does is create legal consequences for real wanna in the future and force me to action the department of labor would need to show   tween even if the government succeeded in persuading an able jr and the court that there was a violation if the government if the deal well had not sent this determination letter it would have been unable to satisfy that third element of notice and that would have made it impossible to extract civil monetary penalties having sent the determination letter though they did government has satisfied that element as a matter of law so instead of  complete legal defense as to repeated innes and future civil monetary panel money pit monetary penalty action suddenly it's on the hook as a matter of law as long as the government succeeds on the merits now as to  issue as to willful that's what the government would need to show in a future civil monetary penalties action is two things they need to show a violation and they need to show the mental state the mental state being willfulness for knowledge reckless regulated party if the department of labor has sent has sent some kind of warning and the regulated party has has ignored it and is it enough that the official who authored the determination letter is the director of the arkansas wage an hour division a subordinate official does that affect that all the finale here because we're used to you know in a lot of cases having something that's definitive from the secretary and we don't have that here do we that's certainly true your hon a couple of points on that one is that the government has never argued that the regional director of the wage an hour a division isn't a competent official with the with the authority to send this kind of notice the second is that almost exactly the cain same kind of circumstance appeared in theater in the seven circuits decision western illinois home health care except that in that case it wasn't even the it wasn't even the regional director it was an assistant regional director western illinois home health care as as we explained in the briefing and indistinguishable decision in the substantive respects the the letter in that case was identical i might add here in fact you could if there's an issue about whether it's whether western illinois home health care is right we decided decision and that is the kind of thing that makes something right when the private party is for has to make a decision at the risk of penalties precisely right and that's what the supreme court said in abbott that's what the said national automatic wanderin see big ag the situations where ripeness is an additional hurdle are cases where there's a kind of additional crystal was asian of the agency's position or of the facts that's necessary before the case is really fit for judicial but in a case like this one where the department or the agency has sent out a letter that addresses a particular business and its particular facts and reach a particular conclusion there's no there's no need for additional personalization all the facts are settled darling letter the letter the consign or volunteer is out emphasizes the course of nature of what's going on because it from the client's perspective from real honest perspective this is really just an effort by the by the agency  to say well we aren't going to going to initiate a ministry for a legal proceeding right now but we're going to going to use it catspaws more or less to do it to do the same thing but of course the darling letter  cites the the water to the consigner volunteers so all you really need in order to understand fully and all you really need in order to evaluate this for final agency actions that are with water and you've been complying with that since that there are legal consequences in this letter in the absence of doubt it would be much harder at the very least to say there are legal consequences we would still have already given and that under that first part of  where you're being being ordered to comply and we still have that argument i recognize that the court is skeptical of that argument but we still be making it making that argument if we didn't if we didn't have the regulations that we have that we have a very different case and in fact  or whichever the the order is in that case that came out before these regulations appeared so in that case there wasn't any any legal action legal effect that could have come from the governor warner in regulation we have to indistinguishable from the civil monetary penalties in sakit which were increased by the compliance letter they are in almost exactly the same way for the question we'll hear from  opinion as to the legality of the employer's actions and the employer and started the agency were to respond the letter by a lower level official like the one that's at issue here with its opinion as to the lawfulness of the employer's actions that letter would employers qanbar shall be deemed known if the employer has received advice from responsible official of the wage and hour provision your opposing counsel makes the point you never disputed that this is a responsible doesn't yeah i don't actually think that that the government did take that position in b c and i think if you look at the decision in fact the court notes that neither party addressed a great defendant the regulations or even attacked the regulations and i think if you look at the briefing in the case you'll see that the government didn't just point to that regulation in say cases over there was a notification case is over instead if you look at the briefing the government had to rest on the argument that was advanced there that no you know because despite the fact that we had notice we with sixteen her court to the secretary to change the regulation on him but i think the government you know obviously changing regulations is a major undertaking the government thinks that its current understanding of the regulations which to be clear is informed by the court's decision in basic is still consistent with the regulations and that you know another portion of the regulations upon which the government relies for its interpretation is the second the last sentence of subsection c wine which notes that all of the facts and circumstances surrounding  circumstance in this portion to it but under people only we don't have that right for the for the civil penalty provision it's just it shall be deemed to be repeated where the employer has previously received notice through responsible fishel of the wage and hour division or otherwise authoritative place so that it seems to me gives you are yet another hurdle you would have to say i mean i understand i think it's there are reasons final agency action in a case like this no i think actually you're honored that you're actually going to misread a little bit the regulation for the repeated violations i think even plaintiffs concede that a violation is not deemed repeated merely  repeat it would be pretty easy to show what am i missing the way that the agency actually interprets its repeated regulations and the way it applies them is actually that it won't it be said it requires that the two violations take place in law in a future civil penalty procedure but it's simply not true because the agency must also prove that the prior violation actually took place and has the burden to prove it from scratch without reliance on the letter so the only function that a letter like this serves in the future civil penalty proceeding with respect to repeated violations is that it can be used to fulfill the notice requirement we don't think that the legal consequences theory i'm should embrace legal consequences that are so that are nearly defined as a legal consequence with respect to a single element lying next to worse legal consequences or if the fact of something is to eliminate one of the two requirements you have to show that seems like a pretty strong legal consequence i think i want to give that answer i also think that actually this court doesn't need to address that question so i want to address both of those but the answer to your question is that that can't possibly be the theory and part of why we know that that theory basically would be that it's on that agency action is some kind of but for cause of liability down the road then it's finally agency action but we know that that's not true we know for example that when you can see files an administrative complaint that's of course a buck or a cause any liability down the road that we know for you can challenge the complaint that's the whole point you can challenge there if you're for the case that deemed means what it seems on its face to me and you couldn't challenge an element i mean imagine if you know about the law says if you if you kill somebody you will be a murderer regardless of your intent well that has a legal consequence the words regardless of intent have a legal consequence a eliminate a normal element of the offense what you keep talking about all the facts and circumstances what other facts and circumstances your view that they're free and clear now they don't have knowledge because their lawyer said no or there is something more to this bill that would be you know a factual determination for a future correct and i'm not going to mine sort of on whether or not that would amount to knowledge or not the point the only point that this court needs to be worried about is whether or not the letter would be sufficient to establish knowledge and it plainly is not necessarily dispositive as you know miss not dispositive but with i would it could be no you wouldn't have an argument about their knowledge  pleaded adequately pleaded a willful violation if the plaintiff completed that they received this letter that they know that braylon is on notice and even though it's between two and three years the case is timely that case is not going to be thrown out on order when you say they would be for the factual development not of the playthings i think i mean i didn't i didn't i don't think that that can be you know enough your honor and that's not an argument that the plaintiffs have made here with respect to that wilfulness to establish a legal consequence i mean i think they're i'm not at i don't i guess i don't see why why there wouldn't be the possibility of an employer responding with that with some additional information as to as to  is about the actual evidence that that's in play and i think that that was their discovery i think that's possible but i don't i don't know that you can have a legal consequence in play because you're forced to go through one stage of the proceedings that you would not otherwise be forced to go through a week you know obviously that would be legal consequences here and that's really important to understand and that's because of the facts of this case for this determination that's at issue here which is the agency's determination that rely on as consumers fallen tears are employees covered by the act  altogether that there would be some kind of that really want to be in some kind of different position with respect to the notice element of the civil penalty regulations but that's just simply not the case even if the agency had never told re align about its conclusions will consigner his volunteers and instead is not satisfied we haven't pressed it because of the very reason that you identified it was something that we can see in the district court but we do think that it would be very odd beyond strange for a letter like this that's issued by an intermediate level official who has it's first starts by doing investigations but it does but it then makes decisions having legal effect only by pursuing either civil action in district court against an employer or by pursuing when you're reading it now looked at just to be clear what i'm saying and and i think maybe i'm not being clear what i'm saying is that the agency notice at issue here certainly satisfy would satisfy the notice requirement within the meaning of the regulation this is a responsible article but in the meaning of it came up in the first circuit you know it came up very briefly in that they did in the second city if you look at the seventh circuit reason i think you'll see that this issue is actually not teed up at all in fact if you look at the seventh circuit recent think you'll see that the government there said that a letter like this would be used as one piece of evidence in future civil penalty proceedings that actually didn't say anything more beyond that certainly didn't say anything consistent with the theory that the answer is balancing if you look at the bay state briefs again that government certainly one of those times some scientists one hundred ninety eight nine time you have all those things to go on that's great those are also factors that i just like to emphasize the plays haven't been able to point to a place where we've taken the opposite position at least certainly since baystate in th say well you know if you do this in the future you can make an argument about we're going to make an argument about it we're going to take the position that's one thing if you say you will be subject to these penalties i think it's important theme of the purpose of peer at that paragraph it is the  the statute and then on top of that if the if the government were able to prove a violation of the compliance order that agency action at issue there then the plaintiffs would be on the hook for a second civil penalty they would so there was a very direct kind of causation between a compl order in this increased amount of penalty we simply don't have anything quite like that here we certainly don't have any statutory regulatory provision in providing for its civil penalties for a violation of a letter like the one that's at issue here  issues here what do you say is in this case they would be able to prove that the first one wasn't a violation in second they wouldn't because there was an actual file order that bound them to do something right away here or here there is no order that bind simply don't think that there is finally see action here i don't see just like you know one very odd consequence that with flow from this court's holding that there's finally agency action here particularly if it holds that the final agency action flows from the then in response to such a holding have had the incentive or potentially want to simply remove such notice requirements altogether from their regulations so as not to trust the final meaning of being to be the one you're even if we didn't have the agency action that plaintiffs are complaining about here and we only and therefore the holes paragraph about consumers found here is were struck from the letter then we would still have a letter where plaintiffs were notified that they were in violation of the law with respect to this other group of employees that i understand your honest question i don't think that that they're inconsistent in that i think that we have to kind of directives in subsection see that are a little bit at war with one another and therefore we need to read them together we have an subsection c one that we know that the presumptive as to awfulness yeah i think that is that's what you must congress reading of that read i think actually that reading that was contradicted if you look at the regulatory history because if you actually look at the regulatory history of the proposed regulation with respect to the willfulness regulation ha  somehow we have finally agency action here because this notice would be dispositive as to the notice element of the regulation and if the consequence of a holding to that effect is that the agency in this case and agencies in other element from the regulation altogether and that would be very odd at that point employers would be in a far worse position than they are now they would not get judicial review of notice from the agency of letters like this from the agency and then they would be on the hook for repeated are imagine you want to know before you do something whether what you're doing violated the law and you sad and they have very advice such as section which will provide advice you ask them is this a violation along they say yes well this court has a number of cases that involve involve opinion letters and what the and what emerges from these cases is more or less the uterus some kind of case kind of case by case you can have a have opinion letters that are basically abstract and tentative and full of a whole whole lot of hedging language by the agencies in which case they are simply an agency's initial position they don't have binding effect and they don't have legal consequence on the other hand you have cases like national automatic laundry where are the agency and in fact the department of labor issued an opinion letter that addressed the particular business model of a particular industry in said that everybody was in violation of the fair labor standards act so it depends on the kind of notice letter if that comes out we don't you want if you're a company can get away with clearer notice letter as you can so that if they say it's ok you're  ok doesn't do much good to get i won't give you a general answer but you can't count on it in any way sort of answer you do want an opinion letter but but again this court's cases are capacious enough to distinguish between between opinion words that have legal consequences and those that don't as for the government's point that the result would be that repeated violators wouldn't have any notice as i was saying there are principles of fair notic process that protect individuals and regulated parties from being that subject to penalties for repeat offenses without any any kind of notice i can continue talking to said well you certainly don't have to argument is essentially that the regulations don't mean what they say and opposing counsel insists that this is the agency's position that's patently absurd your honor it's been fifteen years between in the seventh circuit the first circu decisions in one thousand nine hundred eight and the twenty thirteen determination letter here the regulations never changed during that whole period and in fact to this very day the field operations hand book the department of labor section three has a field operations handbook that we've cited in our in our briefing that discusses the standards for investigations and in a section of that field operations handbook which we cite in our briefing it discusses the standards for  repeats the standard of the of the regulation section five seventy eight three c word for word or virtually virtually forbade them the notion that the department of labor actually doesn't think that it's regulations or we would argue in that case potentially that this had that this is the case with the course of the fact but then but then again you're exactly law and you're you're exactly right though that that kind of case would be a much harder argument that case would start to binding material has actually has binding has binding effect so easy i wouldn't say that it is that the case would be entirely over and that in that regard because there are cases this court's cases right all i mean to say your honor is that this court's cases involving non binding agency documents that i think they're internally reconcilable i don't think i think the district court was mistaken in believing that there is inconsistency between this court's cases and sacked it or between or between or within this court's cases internally internally we can talk about the ins and outs of any given case but it seems to me that the cases were of this court finds no finally agency action typically involve cases where there is say a hypothetical agency guidance that talks about the about facts in abstract terms and doesn't have any legal effect in contrast cases that where there is finally should see effect i wouldn't i wouldn't throw up your i wouldn't throw up one's hands and say that there is there's internal consists in consistency but if you do at the very least then you would want to recognise that the beef supreme court's decision