COMMUNITY NUTRITION INSTITUTE, et al., Appellants, Laura A. Rogers v. Frank YOUNG, Commissioner, Food and Drug Administration.
No. 84-5223.
United States Court of Appeals, District of Columbia Circuit.
Argued Dec. 19, 1986. Decided May 15, 1987.
818 F.2d 943
We hold, too, that a search otherwise unreasonable cannot be redeemed by a public employer‘s exaction of a “consent” to the search as a condition of employment. See Pickering v. Board of Educ., 391 U.S. 563, 568, 88 S.Ct. 1731, 1734, 20 L.Ed.2d 811 (1968); McDonell, 809 F.2d at 1310. Advance notice of the employer‘s condition, however, may be taken into account as one of the factors relevant to the extent of the employees’ legitimate expectations of privacy. See Shoemaker, 795 F.2d at 1142; Security & Law Enforcement Employees v. Carey, 737 F.2d 187, 202 (2d Cir.1984).
Beyond these general principles, we leave to the District Court the decision on the merits of the preliminary injunction motion and the underlying claims.
Reversed and remanded.
Michael J. Ryan, Asst. U.S. Atty., with whom Joseph E. diGenova, U.S. Atty., Royce C. Lamberth, Craig Lawrence, Asst. U.S. Attys., Washington, D.C., Thomas Scarlett, Chief Counsel, Rockville, Md., and Michael M. Landa, Associate Chief Counsel for Enforcement, Food and Drug Admin., were on the brief for appellee. Patricia J. Kenney, Asst. U.S. Atty., Washington, D.C., Stephen D. Terman, Counsel, Food and Drug Admin., Rockville, Md., Richard K. Willard, Atty. Gen., Leonard Schaitman and John M. Rogers, Attorneys, Dept. of Justice, Washington, D.C., entered appearances for appellee.
Before MIKVA, EDWARDS and STARR, Circuit Judges.
Opinion PER CURIAM.
Opinion concurring in part and dissenting in part filed by Circuit Judge STARR.
PER CURIAM:
This case makes its second appearance before this court. It presents a challenge by a consortium of organizations and private citizens (collectively referred to as CNI) to the Food and Drug Administration‘s regulation of certain unavoidable contaminants in food, most particularly, aflatoxins in corn.1 Pursuant to its statutory mandate to limit the amount of “poisonous or deleterious substances” in food, see
CNI filed suit in federal district court, launching a three-pronged attack on FDA‘s action level for aflatoxins in corn: (1) in issuing the action level, FDA failed to comply with the rulemaking requirements of the Food, Drug and Cosmetic Act (FDC Act), see
In our initial opinion, we confined ourselves to CNI‘s first argument. We concluded that the FDC Act, by stating that FDA “shall promulgate regulations,”
The Supreme Court reversed our decision, --- U.S. ---, 106 S.Ct. 2360, 90 L.Ed.2d 959, holding that the FDC Act was not so clear as to preclude FDA‘s interpretation of the statute under which the agency could lawfully proceed by way of action levels. 106 S.Ct. 2360 (1986). Since the Court did not reach the APA or blending issues, it remanded the case to this court for “further proceedings consistent with [its] opinion.” Id. at 2366. Thus, with the first issue resolved by the High Court, we must now address the still pending APA and blending issues.
I
Under the APA, agency rules2 may be issued only after the familiar notice-and-comment procedures enumerated in the statute are completed. See
The distinction between legislative rules and interpretative rules or policy statements has been described at various times as “tenuous,” Chisholm v. FCC, 538 F.2d 349, 393 (D.C.Cir.), cert. denied, 429 U.S. 890, 97 S.Ct. 247, 50 L.Ed.2d 173 (1976), “fuzzy,” Pacific Gas & Electric Co. v. FPC, 506 F.2d 33, 38 (D.C.Cir.1974), “blurred,” Saunders, Interpretative Rules With Legislative Effect: An Analysis and a Proposal For Public Participation, 1986 Duke L.J. 346, 352, and, perhaps most picturesquely, “enshrouded in considerable smog.” Noel v. Chapman, 508 F.2d 1023, 1030 (2d Cir.), cert. denied, 423 U.S. 824, 96 S.Ct. 37, 46 L.Ed.2d 40 (1975), quoted in American Bus Association v. United States, 627 F.2d 525, 529 (D.C. Cir.1980).3 As Professor Davis puts it, “the problem is baffling.” 2 K. Davis, Administrative Law Treatise 32 (2d ed. 1979). By virtue of Congress’ silence with respect to this matter, it has fallen to the courts to discern the line through the painstaking exercise of, hopefully, sound judgment. Guardian Federal Savings & Loan Ass‘n v. FSLIC, 589 F.2d 658, 667 (D.C.Cir.1978).
Despite the difficulty of the terrain, prior cases do provide some useful guideposts. In this circuit, we are particularly guided by American Bus. There, in speaking for the court, Judge McGowan identified “two criteria” that courts have used in their efforts to fathom the interpretative/legislative distinction:
First, courts have said that, unless a pronouncement acts prospectively, it is a binding norm. Thus ... a statement of policy may not have a present effect: “a ‘general statement of policy’ is one that does not impose any rights and obligations“....
The second criterion is whether a purported policy statement genuinely leaves the agency and its decisionmakers free to exercise discretion.
627 F.2d at 529 (quoting Texaco v. FPC, 412 F.2d 740, 744 (3d Cir.1969)).4
In conducting our analysis of these two criteria, we consider and give some, albeit “not overwhelming,” deference to an agency‘s characterization of its statement. Brock v. Cathedral Bluffs Shale Oil Co., 796 F.2d 533, 537 (D.C.Cir.1986).5 As befits a principled exercise in interpretation, courts are to give far greater weight to the language actually used by the agency; we have, for example, found decisive the choice between the words “will” and “may.” Compare American Bus, 627 F.2d at 532 (use of “will” indicates statement is in fact a binding norm) with Guardian Federal, 589 F.2d at 666 (use of “may” indicates statement is a “general statement of policy“).
Applying these principles to the case at hand, we are persuaded that the FDA action levels are legislative rules and thus subject to the notice-and-comment requirements of section 553. While FDA
First. The language employed by FDA in creating and describing action levels suggests that those levels both have a present effect and are binding. Specifically, the agency‘s regulations on action levels explain an action level in the following way:
[A]n action level for an added poisonous or deleterious substance ... may be established to define the level of contamination at which food will be deemed to be adulterated. An action level may prohibit any detectable amount of substance in food.
tolerance, if, in addition, the “appropriateness” of the tolerance may change in the near future because, for example, of technological changes.
Second. This view of action levels—as having a present, binding effect—is confirmed by the fact that FDA considers it necessary for food producers to secure exceptions to the action levels. A specific regulatory provision allows FDA to “exempt from regulatory action and permit the marketing of any food that is unlawfully contaminated with a poisonous or deleterious substance” if certain conditions exist.
Third. On several occasions, in authorizing blending of adulterated with unadulterated corn, see infra Part II, the FDA has made statements indicating that action levels establish a binding form. For example, in a telegram to the Commissioner of the South Carolina Department of Agriculture,
Any food that contains aflatoxin in excess of 20 ppb ... is considered by FDA to be adulterated under section 402(a)(1) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 342(a)(1)), and therefore may not be shipped in interstate commerce.
46 Fed.Reg. 7447 (1981) (emphasis added), reprinted in J.A. at 49. Both statements, one informal and the other elaborately formal, indicate that, when judged under the American Bus criteria, action levels constitute substantive rules. The agency‘s own words strongly suggest that action levels are not musings about what the FDA might do in the future but rather that they set a precise level of aflatoxin contamination that FDA has presently deemed permissible. Action levels inform food producers what this level is; indeed, that is their very purpose.
We are not unmindful that in a suit to enjoin shipment of allegedly contaminated corn, it appears that FDA would be obliged
to prove that the corn is “adulterated,” within the meaning of the FDC Act, rather than merely prove non-compliance with the action level. See United States v. Boston Farm Center, Inc., 590 F.2d 149, 151 (5th Cir.1979).9 The action level thus does not bind food producers in the sense that producers are automatically subject to enforcement proceedings for violating the action level. This factor, accordingly, points in favor of the agency‘s characterization. But the fact that action levels do not completely bind food producers as would a more classic legislative rule (where the only issue before the court would be if the agency rule were in fact violated) is not determinative of the issue. For here, we are convinced that FDA has bound itself. As FDA conceded at oral argument, it would be daunting indeed to try to convince a court that the agency could appropriately prosecute a producer for shipping corn with less than 20 ppb aflatoxin. And this type of cabining of an agency‘s prosecutorial discretion can in fact rise to the level of a substantive, legislative rule. Cf. Nader v. CAB, 657 F.2d 453 (D.C.Cir.1981); Guardian Federal, 589 F.2d at 666-67 (“If it appears that a so-called policy statement is in purpose or likely effect one that narrowly limits administrative discretion, it will be taken for what it is—a binding rule of substantive law.“) (emphasis added). That is exactly what has happened here.
In sum, consideration of a variety of factors leads us to conclude that the FDA‘s action levels are not within the section 553(b)(3)(A) exception to notice-and-comment requirements.10 Since all agree that
We pause to observe that nothing in our decision today generally precludes FDA from proceeding by way of informal action levels. The Supreme Court has, of course, decided that such a course is permissible under the FDC Act. Our limited holding is that the current action levels are treated as substantive rules by FDA and, as such, can only be permitted if notice-and-comment procedures are employed. If it so chooses, FDA could proceed by action levels that are pure policy statements. But in order to do so, FDA must avoid giving action levels the kind of substantive significance that it now so plainly attaches to them.
We add one additional caveat. Our holding today in no way indicates that agencies develop written guidelines to aid their exercise of discretion only at the peril of having a court transmogrify those guidelines into binding norms. We recognize that such guidelines have the not inconsiderable benefits of apprising the regulated community of the agency‘s intentions as well as informing the exercise of discretion by agents and officers in the field. It is beyond question that many such statements are non-binding in nature and would thus be characterized by a court as interpretative rules or policy statements. We are persuaded that courts will appropriately reach an opposite conclusion only where, as here, the agency itself has given its rules substantive effect.
In sum, our holding today is narrow. We conclude that in the circumstances of this case, FDA by virtue of its own course of conduct has chosen to limit its discretion and promulgated action levels which it gives a present, binding effect. Having accorded such substantive significance to action levels, FDA is compelled by the APA to utilize notice-and-comment procedures in promulgating them.
II
The FDA has, on several occasions, granted exemptions to permit the blending
visions of the Act against them.” 106 S.Ct. at 2363. This characterization of the action levels as an agency assurance is consistent with our holding that the action levels are substantive rules subject to notice-and-comment procedures.
of contaminated corn with uncontaminated corn. See, e.g., 43 Fed.Reg. 14,122 (1978), reprinted in J.A. at 41. This blending is typically permitted to help food producers cope with seasonal weather variations which may result in a particular harvest yielding corn with a higher level of aflatoxin. See Supplementary Brief of the State of South Carolina as Amicus Curiae in Support of Appellee at 1-4. In such circumstances, the FDA may permit blending to bring the total level of aflatoxin contamination in the final, blended corn within acceptable levels.
CNI contends that this blending practice causes the final product to be “adulterated” within the meaning of
A food shall be deemed to be adulterated ... if it bears or contains any added poisonous or added deleterious substance ... which is unsafe within the meaning of section 346 of this title.
Section 346, in turn, states that
[a]ny poisonous or deleterious substance added to any food, except where such substance ... cannot be avoided ... shall be deemed to be unsafe for purposes of the application of clause (2)(A) of section 342(a).
The Government does not dispute [CNI‘s] contention that use of an adulterated feed as an ingredient in another feed causes the finished (blended) feed to be adulterated.
Brief for Appellee at 36. But as FDA goes on to point out, a conclusion that a particular food product is “adulterated,” in the abstract, means little other than that FDA
Upon analysis, therefore, the gravamen of CNI‘s complaint is that FDA failed to initiate enforcement proceedings. But as the Supreme Court held in Heckler v. Chaney, 470 U.S. 821, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985), FDA enjoys complete discretion not to employ the enforcement provisions of the FDC Act, and those decisions are not subject to judicial review. As this court recently concluded, the “provisions [of the FDC Act] authorize, but do not compel the FDA to undertake enforcement activity; they ‘commit complete discretion to the [FDA] to decide how and when they should be exercised.‘” Schering Corp. v. Heckler, 779 F.2d 683, 686 (D.C.Cir.1985) (quoting Heckler v. Chaney, 105 S.Ct. at 1658). In light of this principle, CNI‘s arguments on the blending issue must fall.
III
In conclusion, we find FDA‘s action levels to be invalid in that they were issued without the requisite notice-and-comment procedures, but we reject CNI‘s challenge to FDA‘s disinclination to initiate enforcement action against certain blended corn. Accordingly, the case is remanded to the District Court for further proceedings not inconsistent with this opinion.
It is so ordered.
STARR, Circuit Judge, concurring in part and dissenting in part:
I fully concur in section II of the panel opinion, holding that FDA‘s decision to permit blending fell within the agency‘s enforcement discretion. I am also persuaded that the majority‘s careful treatment of the substantive rules-policy statements distinction is not unfaithful to the teachings of this circuit‘s more recent precedents. Nonetheless, I am constrained to conclude that the correct rule was that laid down by our court thirteen years ago in Pacific Gas & Electric Co. v. FPC, where we held:
The critical distinction between a substantive rule and a general statement of policy is the different practical effect that these two types of pronouncements have in subsequent administrative proceedings.... A properly adopted substantive rule establishes a standard of conduct which has the force of law.
506 F.2d 33, 38 (D.C.Cir.1974). The Pacific Gas-enunciated factor—whether the pronouncement has the force of law in subsequent proceedings—should be deemed determinative of the issue. Because there is no doubt that the agency pronouncements at issue here have no such effect, I respectfully dissent from section I of the panel opinion.
I
The abiding characteristic of a legislative rule is that it is law. It defines a standard of conduct that regulated individuals or entities ignore at their peril, in the face of possible enforcement action. Significantly, the only issue in any such proceeding is whether the rule applies to the facts at hand. “The underlying policy embodied in the rule is not generally subject to challenge before the agency.” Id., at 38.
Before such rules are sanctioned one would think that they should be carefully crafted, with the “underlying polic[ies] embodied in the rule” recognized, openly discussed, and deliberately weighed. To return to basic civics for a moment, statutes passed by Congress have been refined in this manner by the very nature of the legislative process. Bills are considered by committees, hearings are held, debate is conducted, compromises are reached, and votes are taken. And all this is carried on in a bicameral legislative body with the final result presented to the President for
In the modern administrative state, many “laws” emanate not from Congress but from administrative agencies, inasmuch as Congress has seen fit to vest broad rulemaking power in the executive branch, including independent agencies. See Synar v. United States, 626 F.Supp. 1374, 1383-84 (D.D.C.) (three judge court), aff‘d, --- U.S. ---, 106 S.Ct. 3181, 92 L.Ed.2d 583 (1986); K. Davis Administrative Law Treatise § 3.8 (1982 Supp.); cf. Ticor Title Insurance Co. v. FTC, 814 F.2d 731, 732 (D.C.Cir.1987) (dismissing on procedural grounds a challenge to the delegation of law enforcement powers to an independent agency). This rulemaking power is obviously cabined by whatever requirements may exist in the particular statute delegating rulemaking authority, a subject which we treated in our initial decision in this case. See 757 F.2d 354 (D.C.Cir.1985). But Congress has also provided in the APA for certain procedural protections before that which achieves the lofty status of “law” is promulgated by an agency acting in its Congressionally authorized lawmaking capacity. Chief among these protections are the notice-and-comment requirements laid down in the familiar provision of
Nonetheless, in crafting the APA, Congress directed that courts should recognize certain exceptions to the statute‘s notice-and-comment requirements. Specifically, Congress recognized that not all agency pronouncements, even those of considerable moment, rise to the dignity of law. Thus, the APA excepts, as the panel opinion recounts, interpretative rules and general statements of policy from the general notice-and-comment requirements. While it is no doubt true, and indeed is frequently recognized, that such agency pronouncements may have a direct effect on the regulated community, and may even be judicially reviewable, see, e.g., AFL-CIO v. Donovan, 757 F.2d 330, 341-43 (D.C.Cir.1985); cf. Abbott Laboratories v. Gardner, 387 U.S. 136, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967), these pronouncements still lack the dignity of “law.” Before that status can be achieved, the agency must run its policies through the notice-and-comment gantlet. Perhaps in part because the agency here has avoided testing its pronouncements in this way, it must in any future proceeding defend and justify its chosen standard in the face of a challenge to that standard. Cf. United States v. Boston Farm Center, Inc., 590 F.2d 149, 151 (5th Cir.1979).
II
The majority is quite correct when it chronicles the difficulty courts have found in attempting to fathom the distinction between legislative or substantive rules on one hand, and interpretative rules or policy statements on the other.1 Inasmuch as our
We should reembrace our Pacific Gas test as the determinative factor in analyzing whether a particular pronouncement is legislative or interpretative in nature. If the pronouncement has the force of law in future proceedings, it is a legislative rule. Unless that critical feature is present, however, the agency statement should be considered to be a lower form of pronounce-
sense of this area by seeking simple, easily-applied rules. In Brock v. Cathedral Bluffs Shale Oil Co., 796 F.2d 533, 539 (D.C.Cir.1986), now-Justice Scalia intimates that “[t]he real dividing point between regulations and general statements of policy is publication in the Code of Federal Regulations.” Such an approach would certainly be simple, if arguably inconsistent with the notion that the deference entitled to an agency‘s own characterizations of its statements is “not overwhelming.” Id., at 537. I prefer the Pacific Gas approach, which has a much firmer rooting in the core principles at issue.
ment, a “non-law” as it were, or in APA terms an “interpretative rule” or “general statement of policy.” The correct measure of a pronouncement‘s force in subsequent proceedings is a practical one: must the agency merely show that the pronouncement has been violated or must the agency, if its hand is called, show that the pronouncement itself is justified in light of the underlying statute and the facts.
Application of this test can readily be illustrated by the case at hand.2 Action levels offer guidance to the regulated community with respect to what products FDA deems adulterated within the meaning of the FDC Act. But in an enforcement proceeding in which FDA seeks either to impose sanctions for shipment of an adulterated product or to enjoin shipment of an adulterated product, the agency must prove the product is “adulterated.” That is, FDA cannot merely show that the product at issue fails to comply with the action level. See Boston Farm Center, 590 F.2d at 151. Rather, FDA must offer scientific or other probative evidence to support its contention that the product is adulterated. Thus, the action level does not have the force of law in the subsequent proceeding. Indeed, it has no “force” at all.
Let me quickly observe that I am not encouraging rebellion and sedition within the circuit. While the law has certainly evolved since Pacific Gas, at no point has this court disavowed that decision.3 Quite to the contrary, the leading case since Pacific Gas, American Bus, expressly embraced the earlier decision. See 627 F.2d at
While I thus view this step as warranted, I recognize a potential danger lurking in the embrace of a single-factor, Pacific Gas test. Agencies may yield to temptation and seek to shield their regulations from the scrutiny occasioned by notice-and-comment procedures, choosing instead to cast would-be regulations as interpretative rules. The rule would still, of course, be subject to scrutiny in a subsequent proceeding, but this fact may be of little comfort to prospective commentors, given the deference accorded agency views in any such proceedings. See generally Chevron U.S.A. Inc. v. NRDC, 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). But upon analysis, the danger is more theoretical than real. Indeed, Congress not atypically provides agencies with a direct command to promulgate regulations, cf., e.g., Industrial Union Department, AFL-CIO v. American Petroleum Institute, 448 U.S. 607, 100 S.Ct. 2844, 65 L.Ed.2d 1010 (1980), thereby imposing a duty that would not be satisfied with issuance of an humble interpretative rule. In this case, of course, the Supreme Court has now ruled that FDA is not required by the organic statute to issue formal regulations, but can instead proceed by way of informal action levels. --- U.S. ---, 106 S.Ct. 2360, 90 L.Ed.2d 959 (1986). But if Congress prefers a traditional model of command to the agencies to issue regulations, it can embrace that model through legislation, informed by the need, reiterated by the Supreme Court in this very case, to avoid dangling participles and other forms of that omnipresent occupational hazard of the draftsman‘s workshop, ambiguity. But see INS v. Cardoza-Fonseca, --- U.S. ---, 107 S.Ct. 1207, 94 L.Ed.2d 434 (1987); Board of Governors v. Dimension Financial Corp., 474 U.S. 361, 106 S.Ct. 681, 88 L.Ed.2d 691 (1986). Because Pacific Gas, and the basic principles upon which it stands, points the way to a quite different result than that reached by my colleagues, I am constrained to dissent in part.