Opinion ID: 522131
Heading Depth: 1
Heading Rank: 4

Heading: vermont yankee

Text: 60 The SEC's principal argument on appeal is that the district court's criticism of its procedures is tantamount to an order directing it, on remand, to alter and to supplement those procedures, and that, as such, the court's decision violates the strictures of Vermont Yankee. Occidental, apparently on the assumption that Vermont Yankee governs this case, responds on the SEC's terms, arguing that nothing in the district court's opinion can be read as ordering the SEC to adopt any specific procedures. Occidental also argues that the district court's decision was proper under Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971), and this court's reverse-FOIA precedents. 61 In Vermont Yankee, the Supreme Court held that a court reviewing an informal rulemaking proceeding conducted pursuant to APA Sec. 553 may not impose upon the rulemaking agency procedural requirements beyond those that Congress specifically set forth in that section. The Court based its holding on the legislative history of Sec. 553, from which it concluded that Congress intended that the procedures it specified would constitute the lawful minimum of process in informal rulemaking; an agency might, in its discretion, supplement those procedures, but a court can not compel it to do so. 435 U.S. at 545-46, 98 S.Ct. at 1212-13. 62 Reverse-FOIA actions are not informal rulemaking proceedings but are in the nature of informal adjudications, Chrysler Corp. v. Brown, 441 U.S. 281, 317-18, 99 S.Ct. 1705, 1725-26, 60 L.Ed.2d 208 (1979), and as such are reviewable under the generally applicable standards of Sec. 706. See Overton Park, 401 U.S. at 415, 91 S.Ct. at 823; AT & T Information Systems, Inc. v. General Services Administration, 810 F.2d 1233, 1236 (D.C.Cir.1987). In contrast to the specific procedures Congress provided in Sec. 553 to govern informal rulemakings, see Vermont Yankee, 435 U.S. at 545-46, 98 S.Ct. at 1212-13, no provision of the APA contains specific procedures to govern an informal agency adjudication subject to review under Sec. 706. Thus the precise holding of Vermont Yankee --that Congress intended statutorily prescribed procedures to preclude additional, judicially imposed procedures--has no direct application to our task in this case. See Scalia, Vermont Yankee: The APA, the D.C. Circuit, and the Supreme Court, 1978 Sup.Ct.Rev. 345, 384-86, 391-92, 399 n. 235. Cf. Steadman v. Securities and Exchange Commission, 450 U.S. 91, 102, 101 S.Ct. 999, 1008, 67 L.Ed.2d 69 (1981) (applying rationale of Vermont Yankee to formal adjudications under APA Sec. 554, which is procedurally specified). 63 Under Sec. 706, a court reviewing an informal agency adjudication must hold unlawful and set aside agency action, findings and conclusions found ... arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. 5 U.S.C. Sec. 706(2)(A) (1982). In Overton Park, the Supreme Court noted that Sec. 706 require[s] the reviewing court to engage in a substantial inquiry, 401 U.S. at 415, 91 S.Ct. at 823, and that in doing so, the court must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment. Id. at 416, 91 S.Ct. at 824. In order to make that determination, the court is to consider the full administrative record that was before the [agency decisionmaker] at the time he made his decision, id. at 420, 91 S.Ct. at 825, and if that record does not contain an adequate explanation of the decision, the reviewing court may require the agency to make additional findings. Id. at 420-21, 91 S.Ct. at 826. Indeed, if it finds that the agency factfinding procedures are inadequate, id. at 415, 91 S.Ct. at 823, the reviewing court may engage in de novo review. In choosing how best to proceed, the reviewing court should consider which method will prove the most expeditious so that full review may be had as soon as possible. Id. at 421, 91 S.Ct. at 826. 64 In Camp v. Pitts, 411 U.S. 138, 93 S.Ct. 1241, 36 L.Ed.2d 106 (1973), the Court further elaborated on the function of a court reviewing an informal adjudication under Sec. 706: If ... there was such failure [by the agency] to explain administrative action as to frustrate effective judicial review, the reviewing court should obtain from the agency such additional explanations of the reasons for the agency decision as may prove necessary. Id. at 142-43, 93 S.Ct. at 1244. If the administrative record is inadequate to support the administrator's decision, then th[at] ... decision must be vacated and the matter remanded to him for further consideration. Id. at 143, 93 S.Ct. at 1244. See also Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744, 105 S.Ct. 1598, 1607, 84 L.Ed.2d 643 (1985) (If the record before the agency does not support the agency action, if the agency has not considered all relevant factors, or if the reviewing court simply cannot evaluate the challenged agency action on the basis of the record before it, the proper course, except in rare circumstances, is to remand to the agency for additional investigation or explanation.). 65 Nonetheless, both the SEC and Occidental appear to assume--and so shall we for purposes of this case--that a number of broad statements in the Vermont Yankee opinion regarding the function of judicial review of agency action have direct application to this review of an informal agency adjudication. For example, the opinion states generally that a reviewing court may not, after determining that additional evidence is requisite for adequate review, proceed by dictating to the agency the methods, procedures, and time dimensions of the needed inquiry and order the results to be reported to the court without opportunity for further consideration on the basis of the new evidence by the agency, 435 U.S. at 545, 98 S.Ct. at 1212 (citations omitted); that Congress intended that the discretion of the agencies and not that of the courts be exercised in determining when extra procedural devices should be employed, id. at 546, 98 S.Ct. at 1213 (emphasis in original); and that if courts continually review agency proceedings to determine whether the agency employed procedures which were, in the court's opinion, perfectly tailored to reach what the court perceives to be the 'best' or 'correct' result, judicial review would be totally unpredictable. Id. 66 Nothing in the general principles of Vermont Yankee is inconsistent, however, with the standards for judicial review set forth in Overton Park. Section 706, as interpreted in the latter case, establishes a performance standard for informal action by an agency: in order to allow for meaningful judicial review, the agency must produce an administrative record that delineates the path by which it reached its decision. If the record does not meet the Overton Park standard, the district court may insist that the agency produce, by whatever means the agency chooses, a record that does meet the required level of performance. The general principles of Vermont Yankee, on the other hand, would simply forbid the reviewing court from imposing upon the agency specific procedural steps that must be followed in order to create a reviewable record, i.e., a design standard. See S. Breyer, Regulation and its Reform 105-06 (1982) (discussing performance versus design standards). Neither party has argued that Overton Park was limited or overruled by implication in Vermont Yankee, and we see nothing in the broad statements in the latter opinion to indicate any lowering of the performance standard mandated by Overton Park. 67 Accordingly, in the specific context of a reverse-FOIA action, this court has held that if the administrative record is inadequate to permit meaningful review, the district court should ordinarily, under the principles stated in Camp v. Pitts, remand for supplementation of the record. AT & T, 810 F.2d at 1236. See also National Organization for Women v. Social Security Administration, 736 F.2d 727, 746 (D.C.Cir.1984) (NOW) (McGowan and Mikva, JJ., concurring). The necessary implication is that where a remand is required in a reverse-FOIA case because the agency's factfinding procedures were inadequate in some regard--albeit perhaps not so stubbornly inadequate as to justify de novo review--the agency will want to use some other procedures in order to produce an adequate record. Moreover, any such remand decision may well involve some healthy criticism of the procedures that produced the inadequate record in the first place. After all, the district court must set forth its reasons for remanding the matter, if only in order to survive appellate review of its decision; a district court that remanded a matter for further proceedings without indicating any connection it perceived between an unacceptably opaque agency decision and the procedures from which it arose would, by its silence, disserve every relevant interest, and advance none. 68 In this case, the district court was not stinting in its criticism of the agency's procedures. As set forth below, however, we find that with respect to each of the SEC's objections to the district court opinion, that court, properly understood, did no more than it was either authorized or required to do by Overton Park, Camp v. Pitts, and AT & T. As a result, we need not reach the question whether at some point a reviewing court's criticism of an agency's procedures in the course of its Overton Park review might, by effectively holding the agency to a specific course of proceeding where others might serve to achieve the standard of performance required under Sec. 706, raise the same concern with judicial encroachment upon congressionally delegated agency discretion as underlay Vermont Yankee. 69