The Government Just Got More Powerful. (And That's a Good Thing.)
Here’s the most important legal principle that you’ve probably never heard of: If a regulation issued by a government agency turns out to be ambiguous, the agency, not the court, gets to resolve the ambiguity. It’s called the Auer principle, after the 1997 Supreme Court decision that established it. (This is different from Chevron deference, which gives agencies deference in interpreting statutes.)
For the past five years, the Auer principle has been under sustained assault from the conservative justices, who have argued that it is a violation of the separation of powers and an unacceptable aggrandizement of executive authority. Few people have noticed, but on Monday the court made it clear that Auer is going to be with us for the long time. For the next president -- whether Hillary Clinton or Donald Trump -- there’s a big reason to celebrate. The rest of us should be celebrating along with them.
In case you’re starting to fall asleep: Auer really is a big deal. Suppose that a regulation from the Department of Justice bans employers from engaging in “discrimination on the basis of sex.” Do those words forbid employers from forbidding transgender people from using their preferred bathroom?
Or suppose that in implementing the Affordable Care Act, the Department of Health and Human Services issues regulations that contain an ambiguity -- say, about what counts as an “essential health benefit.” Is the department allowed to say that certain pregnancy-related procedures qualify as such?
Or suppose that a regulation from the Department of Labor says that certain employers have to report, to the government, any “diagnosis” of cancer within their workforce. Is the department allowed to specify what kind of medical test counts as such a diagnosis?
The Auer principle says that in these cases, and countless more, courts must respect the agency’s interpretation of its regulations, unless that interpretation is arbitrary or unreasonable. In areas that range from heath care to immigration to the environment, that gives the executive branch a lot of authority.
Justice Antonin Scalia was the author of Auer, and for years, he was one of its proponents. He later changed his mind and became the court’s most eloquent critic of his own opinion. He offered two central arguments.
The first involves separation of powers. In Scalia's view, Auer is “a dangerous permission slip for the arrogation of power,” because it allows those who issue regulations to interpret them as well. Ordinarily, “the power to write a law and the power to interpret it cannot rest in the same hands.” Scalia believed Auer violates that fundamental principle.
Scalia’s second argument is that Auer gives agencies an unfortunate incentive, which is “to speak vaguely and broadly,” so as to retain the flexibility to interpret their regulations as they see fit. If courts rejected Auer and paid no attention to the agencies’ interpretation, they would have the right incentive, which is to speak clearly in the first place.
But these arguments sound a lot better than they are. No one should doubt that the separation of powers is important, and if regulations are clear, agencies aren't allowed to deviate from them. But when regulations are ambiguous, do we really want unelected judges to sort out them out? As Scalia recognized in 1997, it’s a lot better to allow ambiguities to be settled by officials who have a degree of accountability (and who are likely to be specialists in the problem at hand).
Nor does Scalia’s incentive argument stand on stronger ground. When agency officials are writing rules, they are thinking of a lot of things, but they are hardly ever thinking about Auer. If they do, Auer actually gives them a reason to be clear: If they aren’t, the next administration, which may have very different political commitments, will be allowed to interpret them as it wishes.
When regulations are ambiguous, by the way, it’s usually because agencies cannot anticipate all of the circumstances to which they might be applied. Most of the time, they do their best to provide clarity. But some situation will arise that they couldn't foresee, and that’s when ambiguity arises. It’s true, of course, that ambiguities can create serious risks -- but the solution is hardly to let courts resolve them. And if agency judgments are arbitrary, they’ll be struck down, even under Auer.
Which bring us to Monday’s decision. The question was whether federal courts should defer to the Department of Education’s interpretation of a regulation governing payment of the costs of collecting on a student loan. The student in question, Bryana Bible, brought a class action, arguing that the Supreme Court should repudiate the Auer principle once and for all.
The court refused to hear the case, and Justice Clarence Thomas provided the only dissent. Invoking Scalia’s argument, he argued that the Auer principle “amounts to a transfer of the judge’s exercise of interpretive judgment to the agency,” and he proclaimed that it is having its “last gasp.”
Almost certainly not. It’s true that the court’s refusal to hear a case doesn't establish a precedent, but if seven of the court’s eight members have no interest in revisiting Auer, it’s probably here to stay. Scalia was right in 1997, and in allowing his ruling to stand nearly twenty years later, the court was right yesterday as well.
Adrian Vermeule and I explain at length in The Unbearable Rightness of Auer, forthcoming in the University of Chicago Law Review, available here.
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