`In the
`Supreme Court of the United States
`
`
`
`DEPARTMENT OF HOMELAND SECURITY, ET AL.,
`Petitioners,
`
`v.
`REGENTS OF THE UNIVERSITY OF CALIFORNIA, ET AL,
`Respondents.
`
`
`
`DONALD J. TRUMP, PRESIDENT OF THE UNITED STATES, ET
`AL.,
`
`Petitioners,
`
`v.
`NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF
`COLORED PEOPLE, ET AL.,
`Respondents.
`
`
`
`KEVIN K. MCALEENAN, ACTING SECRETARY OF HOMELAND
`SECURITY, ET AL.,
`
`Petitioners,
`
`v.
`MARTIN JONATHAN BATALLA VIDAL, ET AL,
`Respondents.
`
`
`
`On Writ of Certiorari to the United States Court of
`Appeals for the Ninth Circuit and Writs of Certiorari
`Before Judgment to the United States Courts of Appeal
`for the District of Columbia and Second Circuits
`
`
`
`BRIEF OF NATIONAL SCHOOL BOARDS
`ASSOCIATION ET AL. AS AMICI CURIAE IN
`SUPPORT OF RESPONDENTS
`
`
`
`FRANCISCO M. NEGRÓN, JR.
`RICHARD P. BRESS
`Chief Legal Officer
` Counsel of Record
`NATIONAL SCHOOL BOARDS
`SAMIR DEGER-SEN
`JESSICA SABA
` ASSOCIATION
`LATHAM & WATKINS LLP
`1680 Duke St., FL 2
`555 11th St., NW, Ste. 1000
`Alexandria, VA 22314
`Washington, DC 20004
`(703) 838-6722
`(202) 637-2200
`richard.bress@lw.com
`Counsel for Amici Curiae
`
`
`
`
`
`
`TABLE OF CONTENTS
`
`Page
`TABLE OF AUTHORITIES ..................................... iii
`INTERESTS OF AMICI CURIAE .............................. 1
`SUMMARY OF ARGUMENT ..................................... 4
`ARGUMENT ............................................................... 7
`I. THE RESCISSION OF DACA MUST
`SATISFY NORMAL APA STANDARDS ............. 7
`A. Reasoned decision-making requires that
`an agency’s rationale be adequately
`explained, that any change in policy be
`acknowledged,
`and
`that
`reliance
`interests are accounted for. ............................ 8
`B. The requirements of reasoned decision-
`making are fully applicable when an
`agency’s stated basis for its decision is a
`change in its interpretation of the law. ....... 10
`C. A court’s independent assessment of
`whether an agency’s policy is unlawful is
`inappropriate. ............................................... 12
`II. THE DECISION TO RESCIND DACA WAS
`ARBITRARY AND CAPRICIOUS ..................... 15
`A. DHS failed to adequately explain why it
`believes DACA is unlawful. ......................... 16
`1. DHS failed to explain why there was
`no “statutory authority” for DACA. ...... 19
`
`
`
`
`
`ii
`TABLE OF CONTENTS—Continued
`
`Page
`to acknowledge or
`failed
`2. DHS
`account for the differences between
`DACA and DAPA. .................................. 20
`3. DHS’s citation to the Fifth Circuit’s
`DAPA ruling is inadequate to justify
`its decision to rescind DACA. ................ 21
`4. The Supreme Court’s affirmance of
`the Fifth Circuit’s DAPA ruling has
`no precedential value. ............................ 23
`5. DHS
`fails
`to
`identify
`any
`constitutional defect of DACA. .............. 24
`B. DHS’s post-hoc explanations should be
`disregarded and, in any event, do not
`meet the requirements for reasoned
`decision-making. ........................................... 24
`C. DHS failed to acknowledge its changed
`policy position or provide reasons for
`that change. .................................................. 31
`D. DHS did not adequately take into
`account reliance interests. ........................... 32
`CONCLUSION .......................................................... 37
`
`
`
`
`iii
`TABLE OF AUTHORITIES
`
`CASES
`
`Page(s)
`
`Advocates for Highway & Auto Safety v.
`Federal Motor Carrier Safety
`Administration,
`429 F.3d 1136 (D.C. Cir. 2005) .............................. 7
`Alpharma, Inc. v. Leavitt,
`460 F.3d 1 (D.C. Cir. 2006) .................................. 25
`
`Altera Corp. & Subsidiaries v.
`Commissioner,
`926 F.3d 1061 (9th Cir. 2019) .............................. 33
`Amerijet International, Inc. v. Pistole,
`753 F.3d 1343 (D.C. Cir. 2014) ............................ 16
`Animal Legal Defense Fund, Inc. v. Perdue,
`872 F.3d 602 (D.C. Cir. 2017) .............................. 12
`Arizona Dream Act Coalition v. Brewer,
`855 F.3d 957 (9th Cir. 2017), cert.
`denied, 138 S. Ct. 1279 (2018) ............................. 19
`
`Bowman Transportation, Inc. v. Arkansas-
`Best Freight System, Inc.,
`419 U.S. 281 (1974) ................................ 6, 9, 18, 23
`Catholic Healthcare West v. Sebelius,
`748 F.3d 351 (D.C. Cir. 2014) ........................ 12, 13
`
`
`
`
`
`iv
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`Checkosky v. SEC,
`23 F.3d 452 (D.C. Cir. 1994) ................................ 30
`
`Citizens to Preserve Overton Park, Inc. v.
`Volpe,
`401 U.S. 402 (1971) .......................................... 7, 25
`East Texas Medical Center-Athens v. Azar,
`337 F. Supp. 3d 1 (D.D.C. 2018) .......................... 11
`Encino Motorcars, LLC v. Navarro,
`136 S. Ct. 2117 (2016) .................................. passim
`FCC v. Fox Television Stations, Inc.,
`556 U.S. 502 (2009) .......................... 5, 9, 10, 31, 33
`Food Marketing Institute v. ICC,
`587 F.2d 1285 (D.C. Cir. 1978) ...................... 26, 31
`Hispanic Affairs Project v. Acosta,
`263 F. Supp. 3d 160 (D.D.C. 2017), aff’d
`in part, rev’d in part, 901 F.3d 378 (D.C.
`Cir. 2018) .............................................................. 32
`
`International Union, United Mine Workers
`of America v. United States DOL,
`358 F.3d 40 (D.C. Cir. 2004) ................................ 22
`
`Interstate Natural Gas Association of
`America v. FERC,
`617 F.3d 504 (D.C. Cir. 2010) ................................ 5
`
`
`
`v
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`Jicarilla Apache Nation v. United States
`DOI,
`613 F.3d 1112 (D.C. Cir. 2010) ............................ 32
`Judulang v. Holder,
`565 U.S. 42 (2011) ................................................ 12
`Kimble v. Marvel Entertainment, LLC,
`135 S. Ct. 2401 (2015) ............................................ 8
`
`LePage’s 2000, Inc. v. Postal Regulatory
`Commission,
`642 F.3d 225 (D.C. Cir. 2011) .............................. 32
`Manin v. NTSB,
`627 F.3d 1239 (D.C. Cir. 2011) ............................ 31
`Michigan v. EPA,
`135 S. Ct. 2699 (2015) ...................................... 5, 27
`
`Motor Vehicle Manufacturers Association of
`the United States, Inc. v. State Farm
`Mutual Automobile Insurance Co.,
`463 U.S. 29 (1983) .......................... 9, 10, 24, 27, 31
`
`National Cable & Telecommunications
`Association v. Brand X Internet Services,
`545 U.S. 967 (2005) ................................................ 9
`Neil v. Biggers,
`409 U.S. 188 (1972) .............................................. 23
`Occidental Petroleum Corp. v. SEC,
`873 F.2d 325 (D.C. Cir. 1989) ................................ 9
`
`
`
`vi
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`Organized Vill. of Kake v. U.S. DOA,
`795 F.3d 956 (9th Cir. 2015) ................................ 27
`
`Pension Benefit Guaranty Corp. v. LTV
`Corp.,
`496 U.S. 633 (1990) .............................................. 25
`Perez v. Mortgage Bankers Association,
`135 S. Ct. 1199 (2015) .......................................... 10
`Ramaprakash v. FAA,
`346 F.3d 1121 (D.C. Cir. 2003) ............................ 32
`
`Regents of the University of California v.
`U.S. DHS,
`908 F.3d 476 (9th Cir. 2018) ................................ 21
`
`Reno v. American-Arab Anti-Discrimination
`Committee,
`525 U.S. 471 (1999) .............................................. 28
`Republic Airline Inc. v. United States DOT
`669 F.3d 296 (D.C. Cir. 2012) ................................ 9
`SEC v. Chenery Corp.,
`332 U.S. 194 (1947) .................................. 12, 13, 14
`
`Select Specialty Hospital-Bloomington, Inc.
`v. Burwell,
`757 F.3d 308 (D.C. Cir. 2014) .............. 5, 20, 28, 30
`Smiley v. Citibank (South Dakota), N.A.,
`517 U.S. 735 (1996) .............................................. 36
`
`
`
`vii
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`Texas v. United States,
`809 F.3d 134 (5th Cir. 2015), aff’d, 136
`S. Ct. 2271 (2016) ............................... 17, 20, 21, 24
`
`Tourus Records, Inc. v. Drug Enforcement
`Administration,
`259 F.3d 731 (D.C. Cir. 2001) ........................ 11, 19
`Transcon. Gas Pipe Line Corp. v. FERC,
`54 F.3d 893 (D.C. Cir. 1995) ................................ 15
`
`Trump v. International Refugee Assistance
`Project,
`137 S. Ct. 2080 (2017) .......................................... 24
`United Airlines, Inc. v. FERC,
`827 F.3d 122 (D.C. Cir. 2016) ................................ 6
`
`Water Quality Insurance Syndicate v.
`United States,
`225 F. Supp. 3d 41 (D.D.C. 2016) ........................ 12
`STATUTES
`5 U.S.C. § 706(2)(A) ..................................................... 7
`6 U.S.C. § 202(5) .................................................. 19, 29
`8 U.S.C. § 1103(a) ...................................................... 19
`Pub. L. No. 106-386, § 1503(d)(2), 114 Stat.
`1464, 1522 (codified at 8 U.S.C. §
`1154(a)(1)(D)(i)(II), (IV)) ...................................... 30
`
`
`
`viii
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`Pub. L. No. 107-296, § 402(5), 116 Stat.
`2135, 2178 (codified at 6 U.S.C. § 202(5)) ........... 28
`Pub. L. No. 110-457, § 204, 122 Stat. 5044,
`5060 (codified at 8 U.S.C. § 1227(d)(1)) .............. 30
`OTHER AUTHORITIES
`Moriah Balingit, As DACA winds down,
`20,000 educators are in limbo, Wash.
`Post (Oct. 25, 2017),
`https://www.washingtonpost.com/local/e
`ducation/as-daca-winds-down-20000-
`educators-are-in-
`limbo/2017/10/25/4cd36de4-b9b3-11e7-
`a908-a3470754bbb9_story.html .......................... 35
`Jill Barshay, Counting DACA students,
`Hechinger Report (Sept. 11, 2017),
`https://hechingerreport.org/counting-
`daca-students/ ...................................................... 35
`David Bier, Rescinding DACA, The Dream
`Act, Would Impose Massive Costs on
`Employers, Newsweek.com (Sept. 5,
`2017)
`https://www.newsweek.com/rescinding-
`dreamers-act-would-impose-massive-
`costs-employers-659813 ....................................... 34
`
`
`
`ix
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`The Department of Homeland Security’s
`Authority to Prioritize Removal of
`Certain Aliens Unlawfully Present in
`the United States and to Defer Removal
`of Others (Nov. 19, 2014),
`https://www.justice.gov/file/179206/
`download .................................................. 19, 28, 31
`Roberto G. Gonzales et al., Center for
`American Progress, Taking Giant Leaps
`Forward: Experiences of a Range of
`DACA Beneficiaries at the 5-Year Mark
`(June 22, 2017),
`https://cdn.americanprogress.org/content
`/ uploads/2017/06/21142115/DACAat5-
`brief2.pdf ........................................................ 33, 34
`Letter from Jefferson B. Sessions III, U.S.
`Attorney General, to Acting Secretary
`Elaine Duke (Sept. 4, 2017),
`https://www.dhs.gov/sites/default/files/p
`ublications/17_0904_DOJ_AG-letter-
`DACA.pdf ..................................... 17, 18, 19, 20, 24
`Memorandum from DHS Secretary Kirstjen
`M. Nielsen (June 22, 2018),
`https://www.dhs.gov/sites/default/
`files/publications/18_0622_S1_Memoran
`dum_DACA.pd ............................. 25, 26, 27, 28, 29
`
`
`
`x
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`Memorandum from Elaine Duke, Acting
`Secretary, DHS, Rescission of the June
`15, 2012 Memorandum Entitled
`“Exercising Prosecutorial Discretion
`with Respect to Individuals who Came
`to the United States as Children” (Sept.
`5, 2017), https://www.dhs.gov/news/
`2017/09/05/memorandum-rescission-
`daca .............................................. 16, 17, 21, 23, 24
`Memorandum from Janet Napolitano,
`Secretary of Homeland Security,
`Exercising Prosecutorial Discretion with
`Respect to Individuals Who Came to the
`United States as Children (June 15,
`2012), https://www.dhs.gov/sites/default/
`files/publications/s1-exercising-
`prosecutorial-discretion-individuals-
`who-came-to-us-as-children.pdf .......................... 29
`David Nakamura, How many people will
`Trump’s DACA rollback affect? About
`100,000 fewer than initially reported,
`Wash. Post (Sept. 7, 2017),
`https://www.washingtonpost.com/news/p
`ost-politics/wp/2017/09/07/how-many-
`people-will-trumps-daca-rollback-affect-
`about-100000-fewer-than-initially-
`reported/ ............................................................... 35
`
`
`
`xi
`TABLE OF AUTHORITIES—Continued
`Page(s)
`
`U.S. Citizenship & Immigration Services,
`Number of Form I-821D, Consideration
`of Deferred Action for Childhood
`Arrivals, by Fiscal Year, Quarter,
`Intake, Biometrics and Case Status
`Fiscal Year 2012–2019 (Nov. 30, 2018),
`https://www.uscis.gov/sites/default/files/
`USCIS/Resources/Reports%20and%20
`Studies/Immigration%20Forms%20Data/
`All%20Form%20Types/DACA/DACA_
`FY19_Q1_Data.pdf .............................................. 29
`
`Updating Regulations Issued Under the
`Fair Labor Standards Act, 76 Fed. Reg.
`18,832-01 (Apr. 5, 2011) ...................................... 11
`Jie Zong et al., Migration Policy Inst., A
`Profile of Current DACA Recipients by
`Education, Industry, and Occupation
`(2017), https://www.migrationpolicy.org/
`research/profile-current-daca-recipients-
`education-industry-and-occupation .................... 35
`
`
`
`
`
`INTERESTS OF AMICI CURIAE1
`Amici curiae are educational organizations deeply
`concerned about the significant consequences that
`state and local government agencies will suffer if this
`Court does not apply its usual standards of judicial
`review under the Administrative Procedure Act
`(“APA”) to hold that the actions of the Department of
`Homeland Security
`(“DHS”) are arbitrary and
`capricious. As entities involved in the provision of
`public education, amici’s members are impacted by
`complex federal agency regulations and actions.
`Amici thus have a strong interest in ensuring that
`federal agencies respect statutory and regulatory
`limitations and engage in reasoned decision-making,
`so as not to issue regulations or take actions that
`unnecessarily harm state and local educational
`interests. Judicial review ensures that agencies
`provide transparency to and allow for meaningful
`participation by organizations such as amici.
`Amici have grave concerns about DHS’s decision
`to rescind Deferred Action for Childhood Arrivals
`(“DACA”). This decision would have
`severe
`ramifications and devastating costs
`for public
`education and the students it serves—impacting
`thousands of school districts and their communities.
`The following education associations respectfully
`submit this amici curiae brief
`in support of
`respondents:
`
`1 The parties filed blanket consents to the filing of briefs
`amici curiae. No counsel for a party authored this brief in whole
`or part; and no such counsel, party, or other person or entity—
`other than amici and their counsel—made a monetary
`contribution intended to fund the preparation or submission of
`this brief.
`
`
`
`
`
`2
`The National School Boards Association
`(“NSBA”),
`founded
`in 1940,
`is a non-profit
`organization representing state associations of school
`boards across the country. Through its member state
`associations, NSBA represents over 90,000 school
`board members who govern approximately 13,800
`local school districts serving nearly 50 million public
`school students. NSBA regularly represents its
`members’ interests before Congress and federal and
`state courts and has participated as amicus curiae in
`numerous cases before this Court. NSBA’s mission is
`to promote equity and excellence in public education
`through school board
`leadership.
` NSBA
`is
`particularly concerned about the ramifications for
`public education and the students it serves that will
`result from the rescission of DACA.
`The School Superintendents Association
`(“AASA”) represents over 13,000 school system
`leaders and advocates. For over 150 years, AASA has
`advocated for the highest quality public education for
`all students, and provided programming to develop
`and support school system leaders nationwide. The
`Nation’s superintendents and the districts and
`students they represent would be harmed by the
`rescission of DACA. As the largest employer in many
`communities, school districts will be impacted by the
`cost of this reversal and it will hinder their ability to
`provide high quality educational opportunities to
`children they educate.
`The National Association of Secondary
`School Principals
`(“NASSP”)
`is the
`leading
`organization of and voice for principals and other
`school leaders across the Nation. NASSP seeks to
`transform education through school
`leadership,
`recognizing that the fulfillment of each student’s
`
`
`
`3
`potential relies on great leaders in every school
`committed to the success of each student. NASSP
`believes that each child is entitled to an excellent
`public
`school education,
`regardless of
`their
`immigration status.
`The American School Counselor Association
`(“ASCA”) represents more than 36,000 school
`counseling professionals. School counselors promote
`equal opportunity, a safe and nurturing environment,
`and respect
`for all
`individuals regardless of
`citizenship status, including undocumented students
`and students with undocumented family members,
`understanding that this population faces unique
`stressors. School counselors work to eliminate
`barriers
`impeding
`student development and
`achievement, and help today’s students become
`tomorrow’s productive members of society.
`
`
`
`
`4
`SUMMARY OF ARGUMENT
`For the past half century, as the administrative
`state has grown more complex and increasingly
`pervasive, Congress and this Court have cabined the
`vast power of executive agencies with one
`fundamental check: that an agency must adequately
`explain its actions. The government’s position in this
`case is a frontal attack on that basic requirement.
`Since DACA was established in 2012, the policy
`has been relied upon by hundreds of thousands of
`residents who entered the United States as children,
`have no criminal records, and meet various
`educational or military service requirements, to apply
`for two-year renewable periods of deferred action. On
`September 5, 2017, DHS rescinded DACA on the
`ground that the agency believed the policy was
`unlawful.
` But the entirety of the agency’s
`explanation for that decision was a cross-reference to
`a threadbare, single-paragraph statement by the
`Attorney General, which did not cite any statutory or
`constitutional provision, did not acknowledge the
`government’s change in position, and did not even
`mention the reliance interests engendered by the
`prior policy.
`Under the ordinary rules governing agency
`decision-making, that explanation was manifestly
`deficient. This case can and should be resolved on
`that ground, without any need for this Court to
`address either the agency’s substantive discretion to
`revoke DACA or the legality of the DACA program
`itself.
`As this Court has recognized time and again, the
`APA requires that “[n]ot only must an agency’s
`decreed result be within the scope of its lawful
`
`
`
`5
`authority, but the process by which it reaches that
`result must be logical and rational.” Michigan v.
`EPA, 135 S. Ct. 2699, 2706 (2015) (emphasis added)
`(citation omitted). Even when a court has “no reason
`to doubt” an agency’s authority to take a challenged
`action, the action must be vacated if the court “cannot
`discern” why the agency made the decision it did.
`Select Specialty Hosp.-Bloomington, Inc. v. Burwell,
`757 F.3d 308, 314 (D.C. Cir. 2014). Furthermore,
`when an agency changes position, it must “display
`awareness” of that change and “show that there are
`good reasons for the new policy.” FCC v. Fox
`Television Stations, Inc., 556 U.S. 502, 515 (2009).
`And when the agency’s prior position has “engendered
`serious reliance interests,” those interests “must be
`taken into account.” Encino Motorcars, LLC v.
`Navarro, 136 S. Ct. 2117, 2126 (2016) (emphasis
`added) (citation omitted). Here, the whiplash from
`this dramatic shift in executive branch policy will, as
`amici can attest, have a devastating impact not only
`on the young people who have come to rely on DACA,
`but on schools, school communities and countless
`other educational and social
`institutions that
`depended on
`the
`stability of
`the agency’s
`interpretation.
`The APA’s procedural requirements stand apart
`from whether the agency’s decision was substantively
`reasonable or even correct. A court assessing a FERC
`ratemaking decision, for example, evaluates not only
`whether the particular rate is reasonable, but also the
`quality of the agency’s explanation for why it
`approved the particular rate. Interstate Nat. Gas
`Ass’n of Am. v. FERC, 617 F.3d 504, 508 (D.C. Cir.
`2010). Even if the figure approved is reasonable, that
`does not immunize the agency’s decision from legal
`
`
`
`6
`challenge if its explanation is inadequate. See United
`Airlines, Inc. v. FERC, 827 F.3d 122, 131 (D.C. Cir.
`2016).
`The subject matter is different but the same rules
`apply where, as here, an agency purports to act based
`on its belief that a particular course of action is
`unlawful. Encino Motorcars, 136 S. Ct. at 2125. The
`question for a reviewing court is not whether the
`agency’s view of the law is in fact correct; rather, it is
`whether the agency has explained its view of the law
`with sufficient clarity so the “path” to its conclusion
`may reasonably be “discerned.” Bowman Transp.,
`Inc. v. Arkansas-Best Freight Sys., Inc., 419 U.S. 281,
`285-86
`(1974).
` Irrespective of
`the ultimate
`correctness of an agency’s legal view, if the proffered
`explanation is inadequate, its decision must be
`vacated. Encino Motorcars, 136 S. Ct. at 2127; United
`Airlines, Inc., 827 F.3d at 131.
`Accordingly, this case provides no occasion to
`assess the ultimate legality of DACA. Rather, this
`Court can and should hold that DACA’s rescission
`was invalid because DHS plainly failed to adequately
`explain its legal position. To hold otherwise would be
`to fashion a dramatically lower standard of judicial
`review for agencies when they invoke putative legal
`rationales for their decisions than when they invoke
`other rationales. And that, in turn, would create
`incentives for agencies to invoke the law as a mask for
`their policy preferences, shirk responsibility for the
`impact of their decisions, and ultimately shift public
`accountability onto the federal courts. That result
`would be inconsistent with the proper division of
`responsibility in our constitutional order and with
`core separation of powers principles. The decision of
`DHS should be vacated.
`
`
`
`7
`ARGUMENT
`I. THE RESCISSION OF DACA MUST SATISFY
`NORMAL APA STANDARDS
`Under the APA, a reviewing court must “hold
`unlawful and set aside agency action . . . found to
`be . . . arbitrary, capricious, an abuse of discretion, or
`otherwise not in accordance with law.” 5 U.S.C.
`§ 706(2)(A). In determining whether an agency
`decision is lawful, a court must engage in a “searching
`and careful” inquiry of whether the agency considered
`the relevant factors and whether a clear error of
`judgment was made. Citizens to Pres. Overton Park,
`Inc. v. Volpe, 401 U.S. 402, 416 (1971). “[U]nsupported
`agency action normally warrants vacatur
`. . . .”
`Advocates for Highway & Auto Safety v. Fed. Motor
`Carrier Safety Admin., 429 F.3d 1136, 1151 (D.C. Cir.
`2005).
`The APA’s requirement of reasoned decision-
`making imposes three core requirements on an
`agency that are relevant here. First, agency action
`must be adequately explained, such that the agency’s
`path to its decision can be reasonably discerned.
`Second, an agency must display awareness of any
`change from its prior position, and explain the basis
`of that change. Third, the agency must take account
`of the reliance interests created by an existing policy.
`A failure to meet any of these three requirements
`justifies a finding that the agency’s decision is
`arbitrary and capricious.
`These principles apply with full force when an
`agency’s purported explanation is that it is compelled
`to act by law. In such circumstances, an agency must
`explain its view of the law in sufficient detail to
`provide assurance that the result was the product of
`
`
`
`8
`reasoned decision-making. And it must account for
`any prior conflicting legal interpretations, and any
`reliance interests created by those interpretations.
`Indeed, because stability of interpretation is expected
`in the law, it is especially important in the legal
`context that changes in interpretation are explained
`and reliance interests accounted for. See Encino
`Motorcars, LLC v. Navarro, 136 S. Ct. 2117, 2127
`(2016); cf. Kimble v. Marvel Entm’t, LLC, 135 S. Ct.
`2401, 2409
`(2015)
`(noting the
`importance of
`“evenhanded,
`predictable,
`and
`consistent
`development” of legal interpretations because of the
`“reliance” they engender (citation omitted)).
`Finally, regardless of the nature of an agency’s
`rationale—whether it be driven by policy, technical
`factors, or law—a reviewing court may not substitute
`its own alternative explanation for the one actually
`proffered by the agency itself. Thus, even if a court is
`inclined to think that an agency’s legal conclusion was
`correct, it cannot affirm the agency’s action if the
`agency’s own explanation is deficient. Instead, the
`court must remand for the agency to explain its
`reasoning. In that posture, the ultimate legality of
`the policy would be beyond the scope of the court’s
`review.
`A. Reasoned decision-making requires that
`an agency’s rationale be adequately
`explained, that any change in policy be
`acknowledged,
`and
`that
`reliance
`interests are accounted for.
`The most basic procedural requirement of
`administrative rulemaking is that an agency “give
`adequate reasons
`for
`its decisions.”
` Encino
`Motorcars, 136 S. Ct. at 2125. This means that an
`
`
`
`9
`agency must “articulate a satisfactory explanation for
`its action including a ‘rational connection between the
`facts found and the choice made.’” Motor Vehicle
`Mfrs. Ass’n of the U.S., Inc. v. State Farm Mut. Auto.
`Ins. Co., 463 U.S. 29, 43 (1983) (citation omitted). An
`agency rule is arbitrary and capricious if the agency
`has “entirely failed to consider an important aspect of
`the problem [or] offered an explanation for its decision
`that runs counter to the evidence before the agency.”
`Id. On the other hand, an agency satisfactorily
`explains a decision when its decision-making “path
`may reasonably be discerned” from the explanation
`provided. Bowman Transp., Inc. v. Arkansas-Best
`Freight Sys., Inc., 419 U.S. 281, 285-86 (1974); see also
`Occidental Petroleum Corp. v. SEC, 873 F.2d 325, 344
`(D.C. Cir. 1989) (an agency must provide “a decision
`that permits the reviewing court to trace the path of
`the agency’s decisionmaking process”).
`reasoned
`Agencies must also provide a
`explanation for any change in policy, including a
`change based on a purely legal rationale. Encino
`Motorcars, 136 S. Ct. at 2125-26. Specifically, an
`agency must “display awareness that it is changing
`position” and “show that there are good reasons for
`the new policy.” FCC v. Fox Television Stations, Inc.,
`556 U.S. 502, 515 (2009); Republic Airline Inc. v. U.S.
`DOT, 669 F.3d 296, 299 (D.C. Cir. 2012) (“One of the
`core tenets of reasoned decision-making is that ‘an
`agency [when] changing its course . . . is obligated to
`supply a reasoned analysis
`for the change.’”
`(alterations in original) (citation omitted)). The
`failure of an agency to explain a change in its policy
`is “reason for holding [the agency’s decision] to be an
`arbitrary and capricious.” Nat’l Cable & Telecomms.
`
`
`
`10
`Ass’n v. Brand X Internet Servs., 545 U.S. 967, 981
`(2005).
`Finally, “[i]n explaining its changed position, an
`agency must also be cognizant that longstanding
`policies may have
`‘engendered serious reliance
`interests that must be taken into account.’” Encino
`Motorcars, 136 S. Ct. at 2126 (quoting Fox Television
`Stations, 556 U.S. at 515). An agency’s disregard for
`such reliance interests is likewise arbitrary and
`capricious. See Perez v. Mortg. Bankers Ass’n, 135 S.
`Ct. 1199, 1209 (2015) (“[T]he APA requires an agency
`to provide more substantial justification . . . ‘when its
`prior policy has engendered serious reliance interests
`that must be taken into account.’” (citation omitted)).
`Agency action that does not meet each of these three
`criteria is arbitrary and capricious within the
`meaning of the APA and must be vacated. See id.,
`Encino Motorcars, 136 S. Ct. at 2125-26; State Farm
`Mut. Auto. Ins. Co., 463 U.S. at 42-43.
`B. The requirements of reasoned decision-
`making are fully applicable when an
`agency’s stated basis for its decision is a
`change in its interpretation of the law.
`The procedural requirements of the APA apply
`with full force where, as here, an agency asserts that
`it was legally compelled to act. Just as with other
`motivations for agency action, the question for
`purposes of APA review is not only the substantive
`reasonableness of the agency’s decision—i.e., whether
`its view of the law is correct—but also whether the
`agency “articulate[d] a satisfactory explanation”
`justifying its legal rationale, State Farm Mut. Auto.
`Ins. Co., 463 U.S. at 43, taking into account its prior
`positions and any reliance interests.
`
`
`
`11
`For example, in Encino Motorcars, this Court
`invalidated a 2011 decision of the Department of
`Labor (“DOL”) interpreting the Fair Labor Standards
`Act (“FLSA”) to require overtime payments to certain
`automobile service providers, after decades of
`treating these employees as exempt. The DOL had
`interpreted the statutory language of the FLSA
`permitting an “exemption
`from
`[the statute’s]
`overtime compensation requirement”
`for
`“‘any
`salesman
`. . . engaged
`in selling or servicing
`[vehicles]’” to exclude “service advisors,” who are
`employees that “sell[] repair and maintenance
`services but not the vehicle itself.” Encino Motorcars,
`136 S. Ct at 2122 (emphasis added) (citation omitted).
`The DOL explained that, in its view, “the statute
`does not include such position[s].” Id. at 2127
`(citation omitted); see also Updating Regulations
`Issued Under the Fair Labor Standards Act, 76 Fed.
`Reg. 18,832-01 (Apr. 5, 2011). This Court held that
`this conclusory assessment amounted to “no reason[]
`at all,” because “the Department did not analyze or
`explain why the statute should be interpreted” to
`support the agency’s reading. 136 S. Ct. at 2127.
`Accordingly, this Court vacated the agency’s decision
`without deciding whether the agency’s statutory
`interpretation was in fact correct. Id.
`Lower courts have similarly applied the APA’s
`requirement
`of
`reasoned decision-making
`in
`analyzing agency actions based on purely legal
`rationales. See, e.g., Tourus Records, Inc. v. Drug
`Enf’t Admin., 259 F.3d 731, 737 (D.C. Cir. 2001)
`(agency action was not “the product of reasoned
`decisionmaking” where it was justified by statement
`of legal “conclusion” as opposed to a “statement of
`reasoning”); E. Tex. Med. Ctr.-Athens v. Azar, 337 F.
`
`
`
`12
`Supp. 3d 1, 19 (D.D.C. 2018) (agency decision violated
`APA where the “Secretary has failed to adequately
`explain his interpretation and application of the
`[relevant statute] and implementing regulation . . . or
`the final rules predating it” (citation omitted)); Water
`Quality Ins. Syndicate v. United States, 225 F. Supp.
`3d 41, 71-72, 76 (D.D.C. 2016) (setting aside agency
`decision based on “the insufficiency of its legal
`analysis” and noting that agency’s “gap in legal
`analysis” rendered its legal conclusions “shaky at
`best”).
`These cases confirm that no special rule applies
`when an agency anchors
`its decision
`in an
`interpretation of law. A reviewing court must still
`“examin[e] the reasons for [the agency’s] decisions—
`or, as the case may be, the absence of such reasons.”
`Judulang v. Holder, 565 U.S. 42, 53 (2011). And, just
`as when an agency justifies its decision on non-legal
`grounds, the lawfulness of agency action depends “on
`the agency’s ability to demonstrate that it engaged in
`reasoned decisionmaking.” Animal Legal Def. Fund,
`Inc. v. Perdue, 872 F.3d 602, 619 (D.C. Cir. 2017).
`C. A court’s independent assessment of
`whether an agency’s policy is unlawful
`is inappropriate.
`Finally, as with other types of agency explanation,
`if an agency’s legal explanation is “inadequate or
`improper, [a] court is powerle