Opinion ID: 52276
Heading Depth: 3
Heading Rank: 2

Heading: Chevron Step-One Analysis

Text: The authority of administrative agencies is constrained by the language of the statute they administer. See Massachusetts v. EPA, __U.S.__, 127 S. Ct. 1438, 1462 (2007). Under the Chevron doctrine, courts assess the validity of challenged administrative regulations by determining whether (1) a statute is ambiguous or silent concerning the scope of secretarial authority and (2) the regulations reasonably flow from the statute when viewed in context of the overall legislative framework and the policies that animated Congress’s design. See Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 842-43, 104 S. Ct. 2778, 2781-82 (1984).
Under Chevron step one, the inquiry is “whether Congress has directly spoken to the precise question at issue.” Id. at 842, 104 S. Ct. at 2781. Judicial deference is due only “if the agency 19 interpretation is not in conflict with the plain language of the statute.” Nat’l R.R. Passenger Corp. v. Boston & Maine Corp., 503 U.S. 407, 417, 112 S. Ct. 1394, 1401 (1992) (citing K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 292, 108 S. Ct. 1811, 1818 (1988)). Step one includes challenges to an agency’s interpretation of a statute, as well as whether the statute confers agency jurisdiction over an issue. See generally FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 120 S. Ct. 1291 (2000). “Regardless of how serious the problem an administrative agency seeks to address, however, it may not exercise its authority ‘in a manner that is inconsistent with the administrative structure that Congress enacted into law.’” Id. at 125, 120 S. Ct. at 1297 (quoting ETSI Pipeline Project v. Missouri, 484 U.S. 495, 517, 108 S. Ct. 805, 817 (1988)).6 As was shown above in our discussion of the statute, the plain language of IGRA permits limited secretarial intervention only as a last resort, and only after the statute’s judicial remedial procedures have been exhausted. See 25 U.S.C. § 2710(d)(7)(B)(i)-(vi). Congress did not explicitly authorize the Secretarial Procedures. Under Chevron step one, when, as here, “the statute is clear and unambiguous, that is the end of the matter; for [this] court, as well as the agency, must give effect 6 Additionally, courts “must be guided to a degree by common sense as to the manner in which Congress is likely to delegate a policy decision of such economic and political magnitude to an administrative agency.” Chevron, 467 U.S. at 133, 120 S. Ct. at 1301. 20 to the unambiguously expressed intent of Congress.” K Mart, 486 U.S. at 291, 108 S. Ct. at 1817 (quoting Bd. of Governors of the Fed. Reserve Sys. v. Dimension Fin. Corp., 474 U.S. 361, 368, 106 S. Ct. 681, 685 (1986)); Chevron, 467 U.S. at 842-43, 104 S. Ct. at 2781-82.7
Chevron deference “comes into play, of course, only as a consequence of statutory ambiguity, and then only if the reviewing court finds an implicit delegation of authority to the agency.” Sea-Land Serv., Inc. v. Dep’t of Transp., 137 F.3d 640, 645 (D.C. Cir. 1998) (citing Chevron, 467 U.S. at 842-44, 104 S. Ct. at 278183). Thus, even if there were an ambiguity concerning whether IGRA permits the Secretarial Procedures without exhaustion of its judicially-controlled remedy, an equally salient fact is that “[m]ere ambiguity in a statute is not evidence of congressional delegation of authority.” Michigan v. EPA, 268 F.3d 1075, 1082 (D.C. Cir. 2001)(citing cases); Montana v. Clark, 749 F.2d 740, 745 (D.C. Cir. 1984) (“[D]eference to an agency’s interpretation constitutes a judicial determination that Congress has delegated the norm-elaboration function to the agency and that the 7 It is noteworthy that the “Indian canon” of statutory construction has no bearing on this case because IGRA unambiguously defines the scope of secretarial authority and the conditions under which such authority may be lawfully exercised. See Negonsott v. Samuels, 507 U.S. 99, 110, 113 S. Ct. 1119, 1125-26 (1993) (courts do not “resort to [the Indian] canon of statutory construction” when a statute is unambiguous (citation omitted)); Cabazon Band of Mission Indians v. Nat’l Indian Gaming Comm’n, 14 F.3d 633, 637 (D.C. Cir. 1994) (“When the statutory language is clear, as it is here, the [Indian] canon may not be employed.”). 21 interpretation falls within the scope of that delegation.” (emphasis in original) (citation omitted)). The Appellees’ argument attempts to obviate Chevron’s delegation requirement by contending that, despite IGRA’s meticulous description of the protracted remedial prelude to the Secretary’s involvement in approving Class III gaming without a state’s consent, this court can nonetheless discover a silent, or “implicit,” delegation of secretarial authority. That is, Appellees contend that even though Congress specifically addressed the circumstances under which secretarial authority can be exercised — and even though those circumstances are absent here — the Secretary’s actions are justifiable because IGRA does not explicitly address the Eleventh Amendment issue that arose in the wake of Seminole Tribe. Courts encountering this kind of “whatever-it-takes” approach to Chevron analysis in the past have rejected it. See, e.g., Platte River Whooping Crane Critical Habitat Maint. Trust v. FERC, 962 F.2d 27, 33 (D.C. Cir. 1992) (appeals to a statute’s broad purposes do not allow the discovery of implicit delegations of authority when Congress has explicitly delineated the boundaries of delegated authority). When Congress has directly addressed the extent of authority delegated to an administrative agency, neither the agency nor the courts are free to assume that Congress intended the Secretary to act in situations left unspoken. See Nat’l R.R. Passenger Corp. v. Nat’l Ass’n of R.R. Passengers, 414 U.S. 453, 458, 94 S. Ct. 690, 693 (1974) (“When a statute limits a thing to 22 be done in a particular mode, it includes the negative of any other mode.” (quoting Botany Worsted Mills v. United States, 278 U.S. 282, 289, 49 S. Ct. 129, 132 (1929))).8 Accordingly, administrative agencies and the courts are “bound, not only by the ultimate purposes Congress has selected but by the means it has deemed appropriate, and prescribed, for the pursuit of those purposes.” MCI Telecomm. Corp. v. AT&T Corp., 512 U.S. 218, 231 n.4, 114 S. Ct. 2223, 2232 n.4 (1994) (emphasis added). Thus, at the heart of the Appellees’ delegation argument is the assumption that since Congress did not explicitly withhold secretarial rulemaking authority in the event that a tribe is unable to obtain a judicial determination of the state’s bad faith, the ensuing congressional “silence” creates an implicit delegation under Chevron to promulgate Class III gaming regulations. That is an inaccurate interpretation of the nature of the delegation inquiry under Chevron’s first step. “Agency authority may not be lightly presumed.” Michigan, 268 F.3d at 1082. “Were courts to presume a delegation of power absent an express withholding of such power, agencies would enjoy virtually limitless hegemony, a result plainly out of keeping with Chevron and quite likely with the Constitution as well.” Ethyl Corp. v. EPA, 51 F.3d 8 See also Pub. Serv. Comm. of State of N.Y. v. FERC, 866 F.2d 487, 491-92 (D.C. Cir. 1989) (executive agencies “cannot enlarge the choice of permissible procedures beyond those that may fairly be implied from the substantive sections and the functions there defined”). 23 1053, 1060 (D.C. Cir. 1995); Michigan, 268 F.3d at 1082.9 It stands to reason that when Congress has made an explicit delegation of authority to an agency, Congress did not intend to delegate additional authority sub silentio. See Backcountry Against Dumps v. EPA, 100 F.3d 147, 151 (D.C. Cir. 1996) (finding that explicit congressional delegation of authority precludes an implicit delegation more expansive than Congress’s express terms). Courts recognize an implicit delegation of rulemaking authority only when Congress has not spoken directly to the extent of such authority, or has “intentionally left [competing policy interests] to be resolved by the agency charged with administration of the statute.” Chevron 467 U.S. at 865-66, 104 S. Ct. at 2793. In IGRA, Congress plainly left little remedial authority for the Secretary to exercise. The judicially-managed scheme of good-faith litigation, followed by negotiation, then mediation, allows the Secretary to step in only at the end of the process, and then only to adopt procedures based upon the mediator’s proposed compact. The Secretary may not decide the state’s good faith; may not require or name a mediator; and may not pull out of thin air the compact provisions that he is empowered to enforce. To infer 9 Nor can congressional silence on an issue be used as a panacea justifying rulemaking authority untethered from any trace of congressional intent. “To suggest, as the [Secretary] effectively does, that Chevron step two is implicated any time a statute does not expressly negate the existence of a claimed administrative power . . . is both flatly unfaithful to the principles of administrative law and refuted by precedent.” Am. Bar Ass’n v. FTC, 430 F.3d 457, 468 (D.C. Cir. 2005) (quoting Ry. Labor Executives’ Ass’n v. Nat’l Mediation Bd., 29 F.3d 655, 671 (D.C. Cir. 1994) (en banc) (emphasis in original)). 24 from this limited authority that the Secretary was implicitly delegated the ability to promulgate a wholesale substitute for the judicial process amounts to logical alchemy.
Citing Seminole Tribe, Appellees further contend that a judicial decision can, ex post facto, create a Chevron-type “gap” that introduces ambiguity into the operation of a statutory scheme and thereby authorizes an administrative agency to step in and remedy the ambiguity. This claim ignores Chevron’s wellestablished requirement that any delegation-engendering gap contained in a statute, whether implicit or explicit, must have been “left open by Congress,” not created after the fact by a court. Chevron, 467 U.S. at 866, 104 S. Ct. at 2793 (emphasis added).10 10 Moreover, no other circuit court to have considered the propriety of the Secretarial Procedures in light of IGRA has discovered the statutory gap purportedly created by Seminole Tribe. The Eleventh Circuit has suggested without any analysis that if a state asserted Eleventh Amendment immunity against a tribe’s lawsuit, the judicial good-faith determination was severable and unnecessary, and the Secretary could simply enforce against the state regulations governing Class III gaming. See Seminole Tribe of Fla. v. Florida, 11 F.3d 1016, 1029 (11th Cir. 1994), aff’d, 517 U.S. 44, 116 S. Ct. 1114 (1996). A close reading of the Eleventh Circuit’s decision, however, demonstrates that it meant to allow the Secretary to proceed under IGRA as if a judicial finding of lack of good faith had been made and a court-appointed mediator failed to bring the parties to terms. See id. (citing § 2710(d)(7)(B)(vii) as the basis for the Secretarial Procedures). Nowhere does the Eleventh Circuit claim that a state’s exercise of Eleventh Amendment sovereign immunity creates a statutory gap. Likewise, considering IGRA in the wake of the Supreme Court’s Seminole Tribe decision, the Ninth Circuit reaffirmed the centrality of the statutory balancing of interests in IGRA’s remedial scheme, yet did not mention the apparent gap Appellees claim was created by the Supreme Court. See United States v. The Spokane Tribe of Indians, 139 F.3d 1297, 1299-1300 (9th Cir. 1998). 25 Although later enacted statutory provisions may be relevant to determine congressional intent for purposes of Chevron ambiguity, see Brown & Williamson, 529 U.S. at 143-44, 120 S. Ct. at 1306-07, there is no support for the proposition that later court decisions affect or effect ambiguity. Chevron’s delegation inquiry gauges congressional intent that is independent from subsequent administrative or judicial constructions of a statute. See Nat’l Cable & Telecomm. Ass’n v. Brand X Internet Servs., 545 U.S. 967, 982, 125 S. Ct. 2688, 2700 (2005)(“[W]hether Congress has delegated to an agency the authority to interpret a statute does not depend on the order in which the judicial and administrative constructions occur.”); see also Bowen v. Georgetown Univ. Hosp., 488 U.S. 204, 208, 109 S. Ct. 468, 471 (1988)(“It is axiomatic that an administrative agency’s power to promulgate legislative regulations is limited to the authority delegated by Congress.”). Accordingly, even though court interpretation of IGRA produced the unexpected result that a state may “veto” Class III gaming by exercising its Eleventh Amendment sovereign immunity, that outcome has no bearing on the scope of the administrative authority originally delegated by Congress to the Secretary. When it so desires, Congress has the power to confer expansive interpretive authority on agencies to accommodate changing or unpredictable circumstances. See, e.g., Massachusetts, __U.S. at__, 127 S. Ct. at 1462 (“The broad language of [Clean Air Act] § 202(a)(1) reflects an intentional effort to confer 26 flexibility necessary to forestall . . . obsolescence.”). Likewise, Congress knows well how to cabin agency authority through specific definitions that pretermit flexible interpretation. See, e.g., Ethyl Corp., 51 F.3d at 1058 (Congress unambiguously expressed that waiver decisions made under Clean Air Act § 211(f)(4) are based exclusively on one criterion). However, the fact that later-arising circumstances cause a statute not to function as Congress intended does not expand the congressionallymandated, narrow scope of the agency’s power. For example, in evaluating the validity of the Federal Reserve’s interpretation of the Bank Holding Company Act in Dimension Financial, the Supreme Court observed that: Congress defined with specificity certain transactions that constitute banking subject to regulation. The statute may be imperfect, but the [Federal Reserve] Board has no power to correct flaws that it perceives in the statute it is empowered to administer. Its rulemaking power is limited to adopting regulations to carry into effect the will of Congress as expressed in the statute. If the Bank Holding Company Act falls short of providing safeguards desirable or necessary to protect the public interest, that is a problem for Congress, not that Board or the courts, to address. 27 Dimension Fin. at 374-75, 106 S. Ct. at 689.11 In strikingly similar terms, the Seminole Tribe Court rejected Florida’s invitation to prescribe a remedy unsupported by the language and legislative history of IGRA. 517 U.S. at 76, 116 S. Ct. at 1133 (“Nor are we free to rewrite [IGRA’s] statutory scheme in order to approximate what we think Congress might have wanted had it known that § 2710(d)(7) was beyond its authority. If that effort is to be made, it should be made by Congress, not by the federal courts.”).12 11 Under the Chevron analysis, the question is whether Congress could be said to have delegated explicit or implicit authority to the agency to deal with an issue. We focus here on implicit delegation since IGRA indisputably does not address the post-Seminole Tribe state of affairs. The Dissent suggests that Congress effects an implicit delegation of legislative authority each time it decides an issue and withholds power from the agency in so doing. Following this ungainly line of reasoning to its conclusion, the Dissent would hold that any time a court overturns a statute speaking expressly to an administrative issue, the agency has been delegated de facto implicit authority to revise the procedure as it sees fit. That result stands Congress’s exertion of power on it head, transforms a denial of agency authority into an implicit delegation thereto, and radically undercuts the Supreme Court’s attempt in Chevron to distinguish between congressional power and agency authority in a principled way. In the Indian gaming context, Congress reacted to the Cabazon Band decision by adopting a highly complex scheme to balance the tribal-state interests inherent in Indian gaming. Congress could have simply authorized the Secretary to promulgate compacts however he chose to do so, or, it could have refrained from acting entirely. It took neither route. Instead, it explicitly withheld power from the Secretary to accomplish IGRA’s balancing scheme. As Dimension Financial states, no court decision can restore power that was withheld by Congress. 12 This comment was made in the context of the Supreme Court’s rejection of a judicially crafted Ex Parte Young remedy — not the Secretarial Procedures at issue in this appeal. But Florida’s proposed Ex Parte Young remedy was rejected by the Supreme Court because, like the Secretarial Procedures, it was contrary to the “carefully crafted and intricate remedial scheme set forth in § 2710(d)(7)” by Congress. Seminole Tribe, 517 U.S. at 73-74, 116 S. Ct. at 1132. The Supreme Court’s reason for rejecting the Ex Parte Young remedy thus applies with equal force to the Secretarial Procedures here. Nevertheless, we acknowledge that the Court explicitly refused to consider the Eleventh Circuit’s “substitute remedy” of Secretarial Procedures. Id. at 76, 116 S. Ct. at 1133; see also 517 U.S. 1133, 116 S. Ct. 1416 (1996) (mem.). 28 Nor does the fact that judicial interpretation of a statute leads to consequences unforeseen by Congress make a statute “ambiguous” within the meaning of Chevron. See, e.g., Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 567, 125 S. Ct. 2611, 2625 (2005)(rejecting legislative history that might have demonstrated Congress “did not intend” to overrule a case because the statutory language was unambiguous that Congress did in fact overrule the case); In re Abbott Labs., 51 F.3d 524, 528-29 (5th Cir. 1995) (applying the plain meaning of a statute even though that construction “may have been a clerical error”); see also Thompson v. Goetzmann, 337 F.3d 489 (5th Cir. 2003). In Thompson, the Department of Health & Human Services sought deference for its interpretation of a particular term, as construed in the applicable regulations and in its lawsuit for Medicare reimbursement. The court stated: [W]e reiterate that the courts are not in the business of amending legislation. If the plain language of the MSP statute produces the legislatively unintended result claimed by the government, the government’s complaint should be addressed to Congress, not to the courts, for such revision as Congress may deem warranted, if any. Id. at 493. Court decisions cannot serve to dilate or contract the scope of authority delegated by Congress to an administrative agency because delegation is a matter of legislative intent, not judicial interpretation. Thus, if Congress did not originally 29 intend to confer rulemaking authority, the Secretary cannot synthesize that authority from a judicial opinion.13