Court Opinion

ID: 6978937
Source: CourtListenerOpinion
Date Created: 2022-07-24 02:16:00.442993+00
Date Added: 2024-06-11T09:12:32.861896
License: Public Domain

SENTELLE, Circuit Judge,
concurring in Parts I, II and IV and dissenting from Part III:
I fully concur with the opinion of the court in Parts I and II. Indeed, I find the legal *110reasoning in Part II to be a commendably clear and unassailably correct application of Chevron analysis. My difficulty with the majority’s opinion lies in the fact that the cogent reasoning of Part II commands an opposite result than that reached by the court in Part III. I, therefore, respectfully dissent from the court’s decision approving the Board’s construction of the term “earnings.”
I.
As the court declares, “we review the Board’s interpretation of the ICC Termination Act under Chevron’s two-step analysis.” Maj. op. at 104 (citing Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984)). As the court further notes, it is our duty to “ask first Svhether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress.’” Id. at 104 (quoting Chevron, 467 U.S. at 842-43, 104 S.Ct. 2778). Only if the statute is “ ‘silent or ambiguous with respect to the specific issue’ ” before us do we proceed to the second step of determining “ ‘whether the agency’s answer is based on a permissible construction of the statute.’ ” Id. (quoting Chevron, 467 U.S. at 843, 104 S.Ct. 2778). In the ICC Termination Act, 49 U.S.C. § 10101 et seq. (1997), Congress provided that the Surface Transportation Board “shall require any Class II rail carrier” receiving the expedited acquisition approval applicable in this case “to provide a fair and equitable arrangement for the protection of the interests of employees ... affected thereby.” Id. § 10902(d). Had Congress stopped there, there would obviously be a broad ambiguity as to the meaning of “a fair and equitable arrangement” and it might well be that we would uphold everything the Board did in this case. But, as the court’s opinion demonstrates, Congress did not stop there.
Congress went on to specify precisely what it meant by “a fair and equitable arrangement.” As the court’s opinion says, “[t]he ... Act specifies certain mandatory labor protection conditions, but expressly deprives the new Board of discretion to impose other labor protection conditions.” Maj. op. at 102 (citing 49 U.S.C.A. § 10902(c) (the Board “may require compliance with conditions (other than labor protection conditions) the Board finds necessary in the public interest”)). As the court notes, this language is not only crystal clear, it is obviously expressive of the deliberate intent of Congress reached after debate and compromise. See id. at 104-05. In other words, Congress had determined and stated what it deemed to be the “fair and equitable arrangement” it was requiring. Therefore, there was no need for this court to reason beyond the first step of Chevron. Congress had determined what the Board could require a railroad conducting an expedited acquisition to provide to affected employees, and the Board was without discretion to expand it. I fear that the court departs from that unassailable reasoning in Part III.
Just as Congress clearly capped the required payments under § 10902(d) at “one year of severance pay,” Congress also clearly defined the method of computation of that benefit. The exclusive benefit “shall not exceed the amount of earnings from railroad employment of the employee during the 12-month period immediately preceding” the date of application, which “shall be reduced by the amount of earnings from railroad employment of the employee with the acquiring carrier during the 12-month period immediately following the effective date of the transaction....” 49 U.S.C. § 10902(d) (emphasis added). Instead of following the congressional formula, the Board has adopted, and the court today allows, a computation in which the payment is not “reduced by the amount of earnings ... during the 12-month period” but instead allows reduction only for amounts computed monthly based not on the earnings of the affected employee, but rather on the per-hour return for the hours worked by that employee. Shortly put, Congress expressly mandated a reduction in the severance pay “by the amount of earnings from railroad employment” of the employee with the acquiring carrier during the relevant 12-month period. The Board, instead of follow*111ing this plain mandate, reduces only when a reduction appears to it proper under a monthly computation based not on the earnings from railway employment, but on the hourly rate of the wage earner. The court, abandoning its allegiance to the clearly expressed intent of Congress demonstrated in Part II, approves this unwarranted assertion of authority under a misapplication of the Chevron doctrine.
The court justifies its move to Step II of Chevron by declaring that “Congress has not ‘directly spoken’ to the question of precisely how the earnings offset should be calculated.” Maj. op. at 106. To support this proposition, the majority offers the silence of the statute on whether earnings includes such things as “payroll deductions for health insurance and employer contributions to pension benefits.” Id. This, however, ignores the Supreme Court’s plain language in Chevron. The deference we afford an agency under that decision arises when “the statute is silent or ambiguous with respect to the specific issue.” 467 U.S. at 843, 104 S.Ct. 2778 (emphasis added). Granted, the statute is ambiguous on what to do with medical and pension benefits. The statute is not ambiguous on the question of whether the severance pay “shall be reduced by the amount of earnings from railroad employment of the employee with the acquiring carrier during the 12-month period immediately following the effective date of the transaction.” 49 U.S.C. § 10902(d). It shall. There is no ambiguity as to whether the earnings to be used are monthly, hourly or annual. They are annual. They are not monthly computed, and they are not hourly adjusted. The payment is to be reduced by what the employee earns from railroad employment during the next 12-month period. That was the expressed intent of Congress. That should be the end of our analysis on this question.
The majority further purports to find the ambiguity it seeks in the language of § 10902(d) which requires “that the Board fashion a ‘fair and equitable’ severance arrangement.” Maj. op. at 106. Granted, that phrase taken out of the context of the statute may look ambiguous. But phrases in a statute are not without context. As the majority clearly demonstrates in Part II, Congress defined what it meant by a “fair and equitable” arrangement. It said what that arrangement consists of. It consists of severance pay “reduced by the amount of earnings from railroad employment of the employee with the acquiring carrier during the 12-month period immediately following the effective date of the transaction.” 49 U.S.C. § 10902(d). The Board seizes the power of Congress when it seeks to redefine that “fair and equitable arrangement,” and this court today aids and abets it. I therefore dissent from that part of the opinion.
II.
I have thus far been silent as to Part IV of the majority opinion. I do concur in that section, but in doing so I wish to comment separately on what I understand the court not to be doing. As the majority notes, the Board requires the submission to arbitration of disputes regarding the application and implementation of the § 10902(d) conditions. The Board does so without any discernible explanation, rationale, or basis for its decision that it has the power to issue this requirement or the ability to make such delegation to a private arbiter. It cannot be gainsaid that the submission of a dispute to arbitration is normally a voluntary act, either at the time of the dispute or at an earlier time in a contract providing for such arbitration. It is equally undeniable “that when Congress has specifically vested an agency with the authority to administer a statute, it may not shift that responsibility to a private actor.” Perot v. Federal Election Comm’n, 97 F.3d 553, 559 (D.C.Cir.1996); National Small Shipments Traffic Conference, Inc. v. ICC, 725 F.2d 1442, 1450 (D.C.Cir.1984) (ICC may delegate certain ministerial functions to staff but decision making must remain with commission); Krug v. Lincoln Nat’l Life Ins. Co., 245 F.2d 848, 852 (5th Cir.1957) (administrative agency cannot delegate quasi-judicial functions); Relco, Inc. v. Consumer Prod. Safety Comm’n, 391 F.Supp. 841, 845 *112(S.D.Tex.1975) (“administrative adjudications” may not be delegated). That said, I nonetheless agree with the majority that we must uphold the Board’s unexplained delegation in this case.
The reason for our anomalous holding is well set out by the majority. That is, circuit precedent forecloses the opposite result. In both Brotherhood of Locomotive Engineers v. ICC, 808 F.2d 1570 (D.C.Cir.1987), and International Bhd. of Elec. Workers v. ICC, 862 F.2d 330, 336 (D.C.Cir.1988), we upheld similar delegations by the Board of disputes not submitted to voluntary arbitration by agreement of the parties. Circuit precedent binds us unless and until it is overruled by this court sitting en banc or by the higher authority. Save Our Cumberland Mountains, Inc. v. Hodel, 826 F.2d 43, 49 (D.C.Cir. 1987), vacated in part, 857 F.2d' 1516 (D.C.Cir.1988) (en banc). I, therefore, concur in the majority’s determination that binding precedent requires us to uphold the Board’s otherwise unsupported decision to delegate these disputes to private arbitration. I do not, however, understand our decision to be providing any precedent for any other agency to act. Our precedent speaks by its terms and binds by its terms, and I do not think we are today intending to create a precedent empowering any other administrative agency to delegate disputes before it to private actors without the consent of the parties.
I find one other aspect of the delegation troubling. The Board’s position seems to be that the decision of the private arbitrators would be reviewed by the Board only under the restrictive “Lace Curtain” standards. See Chicago and Northwestern Transp. Co.Abandonment-Near Dubuque and Oelwein, IA, 3 I.C.C.2d 729 (1987) (Lace Curtain), aff'd sub nom. International Bhd. of Elec. Workers v. ICC, 862 F.2d 330 (D.C.Cir.1988). The Board reiterated this proposition at oral argument. As I understand the Lace Curtain standard, the Board will only review the arbitrator’s decision for “recurring or otherwise significant issues of general importance regarding the interpretation” of labor protection conditions, and will not review decisions dealing with factual questions. Id. at 736. The Administrative Procedure Act entitles administrative litigants before the Board or any other administrative agency to a review of the final agency decision under an arbitrary and capricious standard in which the reviewing court will subject fact findings to a substantial evidence review. See McCarty Farms, Inc. v. STB, Nos. 97-1632 and 98-1307, 158 F.3d 1294, 1998 WL 726248, at *7 (D.C.Cir.1998); MD Pharmaceutical, Inc. v. Drug Enforcement Admin., 133 F.3d 8, 16 (D.C.Cir.1998) (explaining the standard of judicial review under the Administrative Procedure Act, 5 U.S.C. § 706(2)(A), (E)). I do not understand our decision today to be a statement that the Board can apply the Lace Curtain standard to involuntary arbitrations and thereby finesse a litigant out of that statutory right. If in future cases the Board attempts such a bypass of the statutory right, it may be that we will be required to directly review the arbitrator’s decisions on such matters as final agency decisions, see International Bhd. of Elec. Workers, 862 F.2d at 337-38, or that some other remedy can be found. In any event, I do not read today’s decision as approving the Board’s standard of review.
III.
For the reasons set forth above, I concur in the decision of the majority as to the construction of the term “severance pay” but not as to its computation. As to that latter portion of the decision, I dissent.