Administrative Process

Final Examination

Professor Field --- Spring 1997

Instructions

This is a three-hour, open-book exam. You may consult any written materials, but do not discuss your exam with others.

All questions contemplate federal court review of federal agencies unless otherwise indicated. Answer all questions on the answer sheet. There are two parts; note differences in the amount of credit awarded for each.

Part I
[80 points]
Answer any 20 of 24.

[This is not a key, but the most relevant authority is cited in brackets after each question]

Please select the clause that most accurately concludes the last sentence of each question and enter the corresponding letter in the space provided on the answer sheet. [Hint: Questions generally follow the order of the syllabus.]

1. Agency has completed rule making on a matter within its authority. Petitioners sought a rule different in material respects from that which Agency adopted. Although specific provisions address review of adjudication, legislation creating and empowering Agency is silent regarding review of Agency rule making. Review is:
A. proper in any federal circuit court with jurisdiction.
B. proper in any federal district court with jurisdiction.
C. improper because there is nothing in the statute providing for review.
D. likely to be improper if the agency is subject to legislative veto.

[Review is presumptive, and nonstatutory review always originates in District Ct. See Overton Park or, e.g., Rydeen.]

2. Agency has completed a formal adjudication in which it applied for the first time a standard of conduct based on a common law rule. Petitioner seeks review of the decision.
A. Any court with jurisdiction is likely to review de novo.
B. Petitioner will lose if the agency has any authority whatsoever to adopt the standard.
C. Petitioner will prevail if the decision is capricious and arbitrary.
D. Petitioner will prevail if the agency's analysis of the common law is incorrect.

[See Chenery II.]

3. In a formal adjudication, Agency reversed an earlier decision and ordered Client to release certain information to a union attempting to organize its employees. On review, a court:
A. is unlikely to disapprove the order because Agency merely failed to use rule making.
B. is likely to disapprove the order if Agency failed to use rule making.
C. is likely to disapprove the order because of its retroactive effect.
D. is unlikely to disapprove the order if Agency merely failed to give any reasons for reversal of its position.

[See Chenery II, as well as Wyman-Gordon, discussed in National Petroleum Refiners.]

4. The PTO refused to register a mark as scandalous. On review the disgruntled applicant will:
A. win because this interferes with its right to free speech.
B. win, assuming it has common law rights, because this interferes with those rights.
C. win because the term "scandalous" is indefinite without rules defining it.
D. lose if it has no better reasons than those given above.

[See McGinley.]

5. Agency Appeals Panel (APP) has reversed an initial decision favorable to Applicant because facts of record do not warrant that result. Assuming all statutes specific to the agency are silent on this matter and the initial process was informal, on review Applicant will:
A. win because APP reversal interferes with its right to an unbiased decision.
B. win because the APP did not use the clearly erroneous standard of review.
C. lose if the APP, as a court would do, properly applied substantial evidence review.
D. lose if APA § 557(b) is found applicable to the appeal.

[Discussed in the context of Alappat; see also Review of PTO Intramural Appeal Procedures.]

6. Agency can take action called an "order" after "a hearing." Its legislation calls for court review for substantial evidence. Agency promulgated an order after considerable opportunity for all affected to submit documents and written arguments. A participant appealing on the basis of not being allowed, e.g., to submit live testimony:
A. may lose notwithstanding statutory indicia of desire for a formal hearing.
B. will lose because of no statutory indicia of desire for a formal hearing.
C. will win because the legislation shows clear desire for a formal hearing.
D. may lose because the legislation shows clear desire for an informal hearing.

[See Florida East Coast Railway.]

7. Agency Appeals Panel (APP) reversed (2 to 1) an initial decision favorable to Applicant. Earlier, Smith, who wrote the majority panel decision, had published an article highly critical of a legal theory Applicant needed to prevail. On court review of failure of Smith to recuse herself, Applicant:
A. should win; Smith showed convictions that effectively prejudged the case.
B. should win because the entire APP was biased.
C. will lose because Smith may properly prejudge legal theories.
D. should lose because other panel members are unlikely to be influenced by Smith.

[See Association of National Advertisers.]

8. Administrator Jones wants to require attorneys practicing before her high tech agency to demonstrate that they have appropriate technical credentials. She has asked you for an opinion on the matter. You should advise that her agency:
A. can "disbar" attorneys for good reason, but such prescreening is forbidden.
B. can probably require both technical credentials and an examination if she so desires.
C. can require an examination but nothing else.
D. can require relevant technical credentials but nothing else.

[See the Agency Practice Act; also Burke & Field.]

9. Yesterday, Agency published a notice reducing the time for filing a particular document from six months to three. No comment was requested or hearing held. The rule is to become effective in 30 days. On timely petition of someone likely to be adversely affected, a court will probably:
A. disapprove the rule because of failure to use informal rule making.
B. refuse to disapprove the rule for failure to use informal rule making.
C. refuse to disapprove the rule notwithstanding that the statute allows at least six months to file.
D. disapprove the rule for failure to consider comments protesting its adoption.

[See Fressola.]

10. Agency can ban products that pose risks to human health by formal rule making. After such rule making, it banned a product that posing no more risk than eating one peanut every 250 days or spending less than a day in Denver annually. If Agency's assessment of risk cannot reasonably be challenged, a manufacturer seeking court review:
A. will win because such authority facially runs afoul of the non-delegation doctrine.
B. will win because the ban constitutes an uncompensated taking.
C. will lose if the statute speaks in terms of preventing "significant" risks.
D. will lose if the agency has authority similar to a Delaney clause.

[See Industrial Union and Public Citizen.]

11. Agency has promulgated a rule. Enabling legislation required it to be promulgated within 18 months of enactment; Agency took almost three years, notwithstanding being ordered to move more quickly. On petition of Client, a court:
A. is almost sure to invalidate the rule for not being promulgated sooner.
B. is more likely than not to invalidate the rule for not being promulgated sooner.
C. is unlikely to invalidate the rule for not being promulgated sooner.
D. may invalidate the rule as untimely, but only if Client participated in the rule making.

[See Sierra Club.]

12. Agency has the power to reduce risks of serious injuries to children. Agency denied a petition to institute rule making that could have led to requiring child-proof locks on automobiles. It deemed such a rule unnecessary solely because no more than 20% of the population have children of an age warranting such protection. On review, a court is apt to:
A. uphold Agency because its position turns on facts within its unique expertise.
B. require a better reason to justify Agency's position.
C. require Agency to institute rule making.
D. uphold Agency in its finding of no serious risk to children.

[See Hilton, also American Horse and Chaney.]

13. Agency regulates product safety through disclosure. The applicable statute requires certain information to be provided and permits Agency to require still more if warranted. Agency adopted a rule dispensing with statutory requirements on condition that other information be provided. On review, a court is apt to:
A. uphold Agency if it has shown the statutory requirements to be unreasonable.
B. reverse Agency unless it has authority to waive the statutory requirements.
C. uphold Agency if the court finds its alternative requirements more reasonable than those in the statute.
D. reverse Agency if its rule is clearly erroneous.

[See Tire Dealers.]

14. To avoid a very dubious health risk, Agency, after informal rule making, requires a product to be processed in a way likely to make the product repulsive to consumers. It relies on a study not made of record during the rule making. The rule is not subject to statutory review, and violations are subject to criminal sanctions. On petition of an affected manufacturer that participated in the rule making, a court is likely to:
A. review as soon as the rule becomes final.
B. refuse to review, preferring to wait until Agency enforces it.
C. refuse to review for failure to exhaust administrative remedies.
D. require the Agency head(s) to testify, subject to cross-examination, regarding their reasons for adopting the rule.

[See Abbott Labs, also Nova Scotia.]

15. Agency must record claims to certain property upon being presented with specified documents. The statute is silent concerning Agency's rule making power. Jones, the sole Agency Administrator, is considering rules designed to prevent fraudulent documents from being recorded. She has asked you, a staff attorney, for an opinion. You will advise that:
A. she can do this if the statute delegates her policy making authority.
B. she can do this if Agency follows formal rule making requirements.
C. she can do this only if the rule is intended to be legislative.
D. she cannot make any rules without explicit statutory authority.

[Focuses on a limitation inherent in Chevron -- discussed repeatedly.]

16. Representative Snarf wants to combine the PTO and Copyright Office into the Office of Intellectual Property. The PTO Commissioner would be appointed by the Librarian of Congress. He asks for your opinion. You should advise that this arrangement is likely to be:
A. unconstitutional because, unlike the Registrar of Copyright, the PTO Commissioner performs some executive functions.
B. constitutional as long as the PTO Commissioner performs some function that support Congress, e.g., preparing reports on proposed legislation.
C. unconstitutional because, in the opinion of the Librarian of Congress, the Librarian does not serve at the pleasure of the President.
D. constitutional because, although the job is executive, the President appoints the Librarian with the advice and consent of the Senate.

[See Buckley, as discussed in Eltra; also the Librarian's statement.]

17. Agency must grant certain benefits upon a showing that applicants have certain medical disabilities. In a decision based on hearsay, Agency has refused to grant benefits. The only competent evidence of record supports Applicant. However, Applicant had ample opportunity to subpoena anyone she wished before the decision became final. A reviewing court:
A. is likely to apply the residuum rule.
B. is likely to reverse based on the Jencks rule.
C. is unlikely to apply the residuum rule.
D. will reverse because hearsay cannot be used to support any agency decisions.

[See Perales.]

18. Smith wants to protest the PTO's imposing production and quality requirements on her and other members of the TTAB. She has asked for your opinion about the likelihood of success. You should advise that:
A. she is likely to enjoy no "judicial" independence whatsoever.
B. she is not an ALJ, but, if she were, such requirements are not facially invalid.
C. as an ALJ, she enjoys the same independence as district court judges.
D. if she were an ALJ, she would enjoy the same independence as district court judges.

[See Nash; also Review of PTO Intramural Appeals. ]

19. After being threatened by Senator, who chairs a powerful subcommittee, for previously failing to do so, Agency heads ordered staff attorneys to initiate action against your client. If you seek review after asking for reconsideration, a court is likely to:
A. dismiss your petition for failure to exhaust administrative remedies.
B. dismiss your petition for lack of final action.
C. entertain your petition to determine whether your client faces unwarranted legal expense.
D. enjoin the Senator from interfering in Agency's decision making.

[See Standard Oil.]

20. After a formal adjudication and an intramural appeal, Agency heads have approved an order forbidding Client from making certain advertising representations and requiring Client to make affirmative disclosures. The order also requires that Agency prescreen all of Client's advertising. Because, e.g., this is a minor infraction at best and it is the first time your client has violated the law, you believe the order to be overly broad. On review, a court:
A. will remand if Agency's decision is clearly erroneous.
B. is very likely to review de novo the findings underlying the order.
C. can only accept or reject the order as written.
D. may remove order provisions it finds unwarranted.

[See Warner Lambert.]

21. Agency promulgated a rule. Certain Agency actions are reviewable in any district court subject to further review exclusively in the D.C. Circuit. It is unclear whether such provisions apply to this rule. Client has challenged the rule in the District of Connecticut but lost. You played it safe by appealing to the CADC. That court decided that it lacked jurisdiction and transferred the appeal to the 2d Circuit. The 2d Circuit:
A. probably can refuse to hear the case if jurisdiction is doubtful.
B. may refuse jurisdiction if it would prefer not to hear the case.
C. probably cannot refuse jurisdiction.
D. is unlikely to find the matter ripe for review.

[See Christianson.]

22. Having said that it would do so in prior cases, the TTAB refused to apply Apex, an unpublished opinion very helpful to Client. You petitioned the Commissioner to require the TTAB to apply Apex. He denied the petition, and the TTAB has rendered an adverse decision. On review of the last decision, the CAFC:
A. has jurisdiction to address the issue of the refusal to apply Apex.
B. will not review refusal to apply Apex because the issue does not go to the merits.
C. should consider Apex irrelevant because the PTO is entitled to Chevron deference.
D. should uphold refusal to apply Apex because agencies are free to change their mind.

[See Access to and Authority to Cite....]

23. Client provided information clearly marked as trade secrets to Agency. A competitor has filed a FOIA action. Agency has informed Client that it intends to release some of the information Client provided. Client has standing to challenge Agency's decision:
A. under 18 U.S.C. § 1905 because it forbids releasing trade secrets.
B. under FOIA, as a private attorney general.
C. under FOIA, because the requesting party is a competitor.
D. under the APA.

[See Chrylser.]

24. The PTO Office of Enrollment and Discipline has prepared a document that differentiates between attorney misconduct that will and will not result in initiating disenrollment actions. An attorney who handles defense in disenrollment actions has requested the document. After refusal, a court:
A. will compel release unless disclosure might reasonably lead to circumventing the law.
B. will compel release because such information is needed for close review of the PTO's prosecutorial discretion.
C. is unlikely to compel release because the document may contain information about private individuals.
D. will not compel release unless the attorney gives good reasons for needing it.

[See 5 U.S.C. 552 -- esp. (b)(7)(E) -- discussed in the context of Sears.]

Part II
[20 points]
Answer any 20 of 24.

Please select the statement that most accurately defines numbered terms and enter the corresponding letter in the space provided on the answer sheet. [Related terms are grouped.]

[Not a key, but citations appear after statements most likely to cause problems.]
1. Capricious and arbitrary        13. Rule

2. Substantial evidence            14. Order

3. Clearly erroneous               15. Competent

4. De novo                         16. Harmless error

5. Rule making                     17. Finality

6. Formal adjudication             18. Primary jurisdiction

7. Informal adjudication           19. Exhaustion requirement

8. Formal agency action            20. Ripeness

9. Interpretative rule making      21. Independent agency

10. Party                          22. Dependent agency

11. Interested person              23. Non-statutory review

12. Legislative veto               24. Statutory review
A. Officers cannot be removed except for cause. -- see Humphrey's Ex'r
B. Often the product of adjudication.
C. Basis for delay arising from the need for a "case or controversy". -- see Toilet Goods
D. Review provisions do not appear in the organic or enabling legislation.
E. Standard of review for most formal action. -- see § 706
F. Action governed by § 556. -- this section applies to any formal action, whether rule making or adjudication
G. Poor (at best) basis for reversal. -- see § 706
H. Type of statutory provision found to be unconstitutional. -- see Chadha
I. Needed before review is possible under the APA. -- see SOCAL
J. Basis for delay arising from judicial respect for agency expertise. -- see Nader
K. Standard of review rarely used. -- see, e.g., Overton Park
L. Standard of review not specified in the APA. -- see, e.g., Kemps
M. The APA provision governing this kind of action applies only if "required by statute." -- see § 554, applies to adjudication only
N. Agency action exempt from important § 553 requirements. -- see Burke & Field
O. Basis for delay arising from deference to a coordinate branch of government. -- see Darby
P. Action directly governed by § 553.
Q. Action most likely to call for analysis under the due process clause.
R. Rule making participant.
S. Officers serve at the President's pleasure.
T. Sets a prospective standard of conduct.
U. Standard of review for most informal action. -- see, e.g., Overton Park
V. Means the basically the same thing as "admissible".
W. Review provisions are in the organic or enabling legislation.
X. Participant in adjudication.
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