Opinion ID: 164215
Heading Depth: 2
Heading Rank: 1

Heading: Existence of a Meaningful Standard of Review

Text: 21 Judicial review of an agency's compliance with a statute is precluded when the statute is drawn so that a court would have no meaningful standard against which to judge the agency's exercise of discretion. Heckler v. Chaney, 470 U.S. 821, 830, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985). The defendants argued in their motion to dismiss that the statutes and regulations invoked by the plaintiffs fail to provide a meaningful standard for evaluating the RAC appointment decisions. The district court accepted this argument as one of its reasons for dismissing the case, stating its view that the Federal Advisory Committee Act, 5 U.S.C. app. 2 § 5, and the corresponding regulations in 43 C.F.R. § 1784, are too vague to provide a meaningful standard for review. We consider this conclusion with respect to each of the three counts in the plaintiffs' complaint. 22
23 The first count of the plaintiffs' complaint alleges that ten of Governor Owens' nominees were appointed without a requisite letter of reference from the interest or organization they were to represent. 43 C.F.R. § 1784.6-1(e). The plaintiffs claim the failure to abide by its regulation rendered the agency's appointments arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law under the Administrative Procedure Act, (APA) 5 U.S.C. § 706(2)(A) & (D). The defendants admit that letters of reference for the Governor's nominees were not submitted with his recommendations, but letters (which were supplied to the district court and are part of the record on appeal) accompanied the nominations sent to the Secretary for decision. Since the letters of reference were considered by the secretary, they argue, the issue is really one relating to the adequacy of the letters for which the regulation, 43 CFR § 1784.6-1(e), provides no standards and, hence there is no law to apply, rendering the issue one committed to agency discretion under Section 701(a)(2) of the APA. 24 The APA § 701(a) provides an exemption from judicial review for those cases where: (1) statutes [expressly] preclude judicial review, 5 U.S.C. § 701(a)(1); or (2) agency action is committed to agency discretion by law. 5 U.S.C. § 701(a)(2). We agree with the defendants, but from a more global perspective. 25 Exemption from judicial review of agency decisions is narrow. Heckler v. Chaney, 470 U.S. 821, 830, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985). Generally, § 701(a)(2) will be applied when a statute or regulation is drawn so that a court would have no meaningful standard against which to judge the agency's exercise of discretion. Id. In such cases, the statute can be taken to have `committed' the decisionmaking to the agency's judgment absolutely. Id. The exception, however, is not limited to only those cases in which enabling legislation is drawn so broadly there is no law to apply. American Bank, N.A. v. Clarke, 933 F.2d 899, 902 (10th Cir.1991). Whether and to what extent a particular statute precludes review is determined not only from its express language, but also from the structure of the statutory scheme, its objectives, its legislative history and the nature of the administrative action involved. Id. (emphasis added) (quoting Block v. Commty. Nutrition Inst., 467 U.S. 340, 345, 104 S.Ct. 2450, 81 L.Ed.2d 270 (1984)). 26 [A]n administrative agency is not a slave of its rules. Health Sys. Agency of Okla. v. Norman, 589 F.2d 486, 490 n. 5 (10th Cir.1978) (internal citation and quotations omitted). Although it is axiomatic that duly promulgated rules will have the force and effect of law, not every agency-made law is of such a nature that its violation should invalidate agency action. See French v. Edwards, 13 Wall. 506, 80 U.S. 506, 511, 20 L.Ed. 702 (1871). In certain instances, agencies are permitted to waive compliance with their own procedural rules. It is the nature of the administrative action involved that provides the foundation for this exception to the reviewability of agency decisions. American Bank, 933 F.2d at 902. 27 The Supreme Court directly addressed this principle in American Farm Lines v. Black Ball Freight Serv., 397 U.S. 532, 538-39, 90 S.Ct. 1288, 25 L.Ed.2d 547 (1970). There, the Interstate Commerce Commission (ICC) granted a motor carrier's application for temporary operating authority despite the fact that the carrier's application did not contain certain information required by the ICC's regulations. Competing motor carriers contended that the ICC was required by its own rules to reject the application. In rejecting the competing carrier's position, the Court noted the regulation was adopted to facilitate the ICC's own information gathering and was not intended primarily to confer important procedural benefits upon individuals.... Id. at 538, 90 S.Ct. 1288. The Court relied upon the established principle that: 28 [I]t is always within the discretion of a court or an administrative agency to relax or modify its procedural rules adopted for the orderly transaction of business before it when in a given case the ends of justice require it. The action of either in such a case is not reviewable except upon a showing of substantial prejudice to the complaining party. 29 Id. at 539, 90 S.Ct. 1288 (quoting NLRB v. Monsanto Chem. Co., 205 F.2d 763, 764 (8th Cir.1953)). 30 Thus, Black Ball Freight carves out a limited exception to the general rule that agencies are required to adhere to their own regulations. This limited exception turns on whether the regulations were intended to confer important procedural benefits upon the parties before the agency or whether they are merely procedural rules for the orderly transaction of agency business. Even if it is determined that the regulations are of the latter type, an agency will be required to adhere to its own regulations where the complaining party will suffer substantial prejudice in the absence of such adherence. 31 With these principles in mind, we turn to the plaintiffs' allegations in count one of their complaint. The controlling statutes, the FLPMA and FACA, are silent as to the materials, if any, the Secretary must review in deciding whom to appoint to advisory committees. The controlling statutes, therefore, provide no law to apply to review the Secretary's decision regarding the appointment of individuals for the Colorado RACs. 32 However, the agency's regulations governing the appointment of RAC members may also be a basis for their claim. The regulation relied on by the plaintiffs states: 33 In making appointments to resource advisory councils the Secretary shall consider nominations made by the Governor of the State or States affected and nominations received in response to public calls for nominations pursuant to § 1784.4-1. Persons interested in serving on resource advisory councils may nominate themselves. All nominations shall be accompanied by letters of reference from interests or organizations to be represented. 34 43 C.F.R. § 1786.6-1(e). 35 We must first consider whether this regulation provides law to apply. The regulation plainly instructs that all nominations shall include: 1) letters of reference, 2) from interests or organizations to be represented. Assuming this language provides adequate guidance to apply judicial review, our inquiry does not end here. 3 36 We must then ask if the regulation proscribes agency action which by its nature is for the benefit of the agency's orderly transaction of business, or whether it confers a benefit on the plaintiffs. The plaintiffs maintain the purpose of the reference letter requirement ... is to ensure that the nominees in fact represent the interests they claim to, and that they are qualified to represent them. (Appellants' Br. at 18). In essence, the plaintiffs argue the purpose of the requirement is to provide the agency with needed information. It is not uncommon for the internal procedure exception enunciated in Black Ball Freight to be applied in situations where the regulation specifies the content of submissions to the agency. See e.g., United States v. Caceres, 440 U.S. 741, 754 n. 18, 99 S.Ct. 1465, 59 L.Ed.2d 733 (1979); Central Freight Lines, Inc. v. United States, 669 F.2d 1063, 1070 (5th Cir.1982) (procedural rules designed for processing applications may be relaxed or waived). 37 Here, the agency's regulations do not state how the Secretary is to assess the letters of reference or what weight should be given to those letters. They may well establish an applicant's bona fides as a member of or spokesman for an interest group. On the other hand, they may only provide a starting place for the Secretary's background inquiry. The regulations do not limit the Secretary's information gathering solely to reference letters. In fact, the plaintiffs allege the Governor was contacted about his nominees by the Bureau of Land Management Colorado State Director before she made her recommendation to the Secretary. Thus, additional information regarding the nominees was acquired through at least one avenue. Presumably, unsolicited letters from interest groups would also be considered. Moreover, the quality and legitimacy of the person or organization authoring the letter of reference requires evaluation. At bottom the appointment decision is left to the Secretary's discretion, subject only to the ultimate result that a fair balance of membership be achieved. Therefore, as in Black Ball Freight, the regulation here is not intended to confer important procedural benefits on a party; it is, instead, a procedural aid for the benefit of the agency. 4 38 We next inquire whether the plaintiffs were substantially prejudiced by the agency's acceptance of the Governor's nominations without an accompanying letter of reference from the interest or organization to be represented. This question is more accurately phrased in this case as whether the acceptance of the nominees' applications without the letters of reference denied the plaintiffs a fair opportunity to be appointed to a position on the RAC. Only two plaintiffs identified a direct interest in the appointment process, Houdek and Peters. This is not a situation where the Secretary prevented the plaintiffs from submitting relevant information that would promote their candidacies. Rather, their applications comprised two of approximately fifty applications submitted with an accompanying letter of reference. In other words, had the Secretary not accepted the ten nominees who did not have letters of reference from an interest or organization, the remaining nominees would have had one chance in fifty, as opposed to one chance in sixty, for appointment to the RAC. We do not find this difference amounts to substantial prejudice to the applicants who submitted letters of reference. Therefore, the regulation at issue in Count One of plaintiffs' complaint falls within the exception enunciated in Black Ball Freight, and is not reviewable by the court. 39
40 The second claim in the plaintiffs' complaint is that the agency permitted Governor Owens inappropriately to influence the appointment process by allowing him to control a significant number of advisory committee members on the RACs in violation of the FACA, 5 U.S.C. app. 2 § 5(b)(3). As with Count 1, the plaintiffs sued under the APA, arguing that by failing to abide by the requirements of the FACA, the Secretary's appointments to the RACs were arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. 5 U.S.C. § 706(2)(A). The district court dismissed this count because it concluded that 5 U.S.C. app. 2 § 5 was too vague and, therefore, did not provide judicially administrable standards. 41 Again, we must apply the Heckler v. Chaney test to determine whether the statute is drawn so that a court would have no meaningful standard against which to judge the agency's exercise of discretion. 470 U.S. at 830, 105 S.Ct. 1649. We conclude that there is no meaningful standard of review provided in the statute and that the district court accordingly did not err in dismissing this count of the complaint. 42 Section 5(b) of the FACA sets forth a number of requirements relating to the composition and operation of advisory committees: 43 (b).... Any such legislation [authorizing the establishment of an advisory committee] shall — 44
45 (2) require the membership of the advisory committee to be fairly balanced in terms of the points of view represented and the functions to be performed by the advisory committee; 46 (3) contain appropriate provisions to assure that the advice and recommendations of the advisory committee will not be inappropriately influenced by the appointing authority or by any special interest, but will instead be the result of the advisory committee's independent judgment .... 47 5 U.S.C. app. 2 § 5(b)(1)-(3) (emphasis added). The requirements of § 5(b)(3) are made applicable to agencies by § 5(c), which states: To the extent they are applicable, the guidelines set out in subsection (b) of this section shall be followed by the President, agency heads, or other Federal officials in creating an advisory committee. 5 U.S.C. app. 2 § 5(c). 48 We conclude that § 5(b)(3) does not provide a meaningful standard of review for a court to apply. We are not concerned here with the phrase appointing authority because the appointing authority is the Secretary of the Interior and plaintiffs do not allege that the Secretary is inappropriately influencing the RAC's independent judgment. Instead, plaintiffs argue that Governor Owens is a special interest who, by virtue of his sponsorship of such a large group of nominees to these RACs has inappropriate influence over the independent judgment of these RACs. 49 The problem we have with this claim centers on the word inappropriate. The very structure of the statute and regulations calls for various special interest groups to recommend candidates for appointment to the RACs that will be giving advice on issues of interest to the recommending entities. It goes without saying that the special interests will recommend nominees who agree with their point of view. That is why the statute and regulations require nominees from a variety of backgrounds — to get different perspectives expressed on the RAC. So, it is not only obvious, but is apparently desired, that the nominees would be aligned with, and hence influenced by, the special interest groups that recommended them. The question is, what does § 5(b)(1)-(3) mean when it prohibits only inappropriate influence? Would a call from the recommending entity to a nominee about an issue under consideration constitute inappropriate influence? One would doubt it, but the statute does not give us any guidance as to when the line is crossed between appropriate and inappropriate influence. Perhaps bribes or threats from a recommending interest group to its nominee could be regarded as inappropriate influence, but there is no allegation of anything of that nature here and so we do not need to consider those extreme situations. 50 What is alleged here is simply that Governor Owens will have an inappropriate amount of influence over these RACs by virtue of having nominated or endorsed such a large percentage of the membership of these RACs. But whether Congress intended that kind of hypothetical future influence to be inappropriate, and hence illegal under § 5(b)(3), is something as to which we have absolutely no guidance, guidelines or standards from Congress. Thus, we hold that plaintiffs' claim under § 5(b)(3) is not justiciable. In this regard, we disagree with the Fifth Circuit in Cargill, Inc. v. United States, 173 F.3d 323, 339 n. 30 (5th Cir.1999), which held that claims under § 5(b)(3) were justiciable. 51 Plaintiffs' concern about inappropriate influence arising from an interest group sponsoring a disproportionate number of nominees to an RAC should, instead, be addressed under 43 C.F.R. § 1784.2-1(a), which requires a fair membership balance in the RAC. That is the substance of plaintiffs' third claim, and it is that claim to which we now turn. 52
53 The plaintiffs' third claim in their complaint is that the agency failed to abide by its regulation requiring that advisory committees have a fair membership balance. 43 C.F.R. § 1784.2-1(a). As with Counts 1 and 2, the plaintiffs brought their claim under the APA, 5 U.S.C. § 706(2)(A), and the district court dismissed the count because the regulation was too vague to provide a meaningful standard of review. We conclude that this regulation is justiciable. Section 1784.2-1(a) states: 54 Each advisory committee shall be structured to provide fair membership balance, both geographic and interest-specific, in terms of the functions to be performed and points of view to be represented, as prescribed by its charter. Each shall be formed with the objective of providing representative counsel and advice about public land and resource planning, retention, management and disposal. 55 43 C.F.R. § 1784.2-1(a) (emphasis added). The regulation was promulgated pursuant to FACA, see 43 C.F.R. § 1784.0-3(a), and the emphasized portion closely tracks the language of FACA's § 5(b)(2), which requires that advisory committees be fairly balanced in terms of the points of view represented and the functions to be performed by the advisory committee. 5 U.S.C. app. 2 § 5(b)(2). In addition, in a section speaking specifically about the RACs, the BLM regulations say that [i]n appointing members of a [RAC] from the 3 categories set forth in [§ 1784.6-1(c)(1), (c)(2), and (c)(3)] ... the Secretary shall provide for balanced and broad representation from within each category. 43 C.F.R. § 1784.6-1(d). 56 There is no case law addressing the precise question whether the fair balance requirements of 43 C.F.R. §§ 1784.2-1(a) and 1784.6-1(d) are justiciable. However, several courts have addressed the question whether the analogous fair balance provision in 5 U.S.C. app. 2 § 5(b)(2) is justiciable. The Fifth and D.C. Circuits have held that the fair balance requirement of § 5(b)(2) is justiciable, and no court of appeals has held to the contrary. See Cargill, 173 F.3d at 335; Public Citizen v. Nat'l Advisory Comm. on Microbiological Criteria for Foods, 886 F.2d 419, 423-25, 433 (D.C.Cir.1989) (majority agreeing that § 5(b)(2) is justiciable). The Eleventh Circuit also has strongly suggested that § 5(b)(2) is justiciable by upholding a district court's injunction imposed to remedy violations of § 5(b). 5 Alabama-Tombigbee Rivers Coalition v. Dep't of Interior, 26 F.3d 1103, 1106-07 (11th Cir.1994). We find these cases to be persuasive authority for the instant case. 57 We therefore adopt the reasoning of the Fifth and D.C. Circuits and apply it to the fair balance requirement of 43 C.F.R. §§ 1784.2-1(a) and 1784.6-1(d). The BLM regulations are not [one of] those rare instances where statutes are drawn in such broad terms that in a given case there is no law to apply. Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 410, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971) (internal quotation marks omitted). As Judge Edwards wrote in Microbiological Criteria: 58 It does not matter that the fairly balanced requirement falls short of mathematical precision in application, or that it may involve some balancing of interests by the agency. The presumption in favor of judicial review is not altered in the face of a diffuse statutory directive. Indeed, this [is] one of the principal points of the Supreme Court's decision in Overton Park. In that case, the Court allowed a suit under a statute that prohibited the Secretary of Transportation from authorizing the use of federal funds to finance the construction of highways through public parks if a feasible and prudent alternative route exists and allowed construction through parks only if there has been all possible planning to minimize harm to the park. Overton Park, 401 U.S. at 411, 91 S.Ct. 814.... The feasible and prudent and minimize harm standards involved a significant and ill-defined weighing of interests by the agency, just as does the fairly balanced standard in this case. However, as the Court made clear, this did not mean that there was no law to apply. Id. at 410-13, 91 S.Ct. 814.... While the difficulty of determining what precisely constitutes a fair balance may incline courts to be deferential in reviewing the composition of advisory committees and may defeat a plaintiff's claims in a given case, this cannot be grounds for refusing to enforce the provision altogether. 59 Microbiological Criteria, 886 F.2d at 434 (Edwards, J., concurring in part and dissenting in part). 60 Compared to the statutes at issue in Overton Park and Microbiological Criteria, which provided law to apply even though they required ill-defined weighing of interests, the BLM regulations provide a more precise standard for determining what constitutes a fair balance of interests on the RACs. Section 1784.6-1(c) requires that appointees to RACs be representative of three general groups, each of which is comprised of specific subgroups: (1) people with interests in federal grazing permits, transportation or rights-of-way, outdoor recreation, commercial timber operations, or energy and mineral development; (2) people representing nationally or regionally recognized environmental groups, dispersed recreational activities, archeological and historical interests, or wild horse and burro interest groups; and (3) persons who hold state, county or local elected office, are employed by state natural resources agencies, represent local Indian tribes, are employed as academics in natural resource management or the natural sciences, or represent the public-at-large. 43 C.F.R. § 1784.6-1(c)(1)-(3). The regulations state that the Secretary shall provide for balanced and broad representation from within each category of interests described in § 1784.6-1(c). 43 C.F.R. § 1784.6-1(d). Thus, whereas under § 5(b)(2) a court must determine what interests should be represented in light of the purpose and functions of the advisory committee before deciding whether those interests are fairly represented, see Cargill, 173 F.3d at 336, 337, under § 1784.6-1(c) the court knows which categories of interests are entitled to representation on the RACs. 61 In fact, the BLM regulations do more than simply list the interest groups that are to be represented on the RACs. The regulations require that RACs be organized consistent with one of three models described in 43 C.F.R. § 1784.6-2. The three models differ in terms of what jurisdiction the RAC covers, what constitutes a quorum for conducting RAC business, and what subgroups may be formed to work under the RAC. See 43 C.F.R. § 1784.6-2(a)(1), (a)(2), and (a)(3). Most relevant for our purposes, however, is how this section specifies the membership requirements for each model RAC. Under Model A, [e]ach council shall have 15 members, distributed equally among the 3 interest groups specified in § 1784.6-1(c). 43 C.F.R. § 1784.6-2(a)(1)(ii). Model B is more precise, consisting of 15 members, distributed equally among the 3 interest groups specified in § 1784.6-1(c), and will include at least one representative from wildlife interest groups, grazing interests, minerals and energy interests, and established environmental/conservation interests. The Governor [of the covered state] shall chair the council. 43 C.F.R. § 1784.6-2(a)(2)(ii). Model C states that [m]embership of the council shall be 10 to 15 members, distributed in a balanced fashion among the 3 interest groups defined in § 1784.6-1(c). 43 C.F.R. § 1784.6-2(a)(3)(ii). In requiring equal representation of the three groups defined in § 1784.6-1(c), Models A and B require that five members of the fifteen-member RAC be drawn from each interest group. Model C requires balanced representation from among the three interest groups because RACs under the model may have 10, 11, 13, or 14 members, sizes that do not permit equal representations from among the three groups. Still, balanced representation under Model C at least requires that none of the interest groups be significantly over-represented compared to the others. 62 For the foregoing reasons, we hold that the fair balance requirement of 43 C.F.R. §§ 1784.2-1(a) and 1784.6-1(d) is justiciable and the district court erred in dismissing Count 3 of the complaint.