SCOTUS Drives a (Corner) Post Through the Heart of the Bureaucratic State

AP Photo/Susan Walsh

Six years ago, the Supreme Court finished its term by driving a stake through government-compelled speech in a trio of cases: JanusMasterpiece Cakeshopand perhaps especially NIFLAWhile those cases didn't entirely end that process -- Jack Phillips is still getting persecuted in Colorado, for one thing -- the line of decisions set a line in the sand on which to fight government intrusion in speech and the free exercise of religious beliefs.

This term may have done even more work in building ramparts against government intrusion by the bureaucratic state. In three key decisions this term, the Supreme Court reinstated the Seventh Amendment in common-law cases brought by bureaucracies, removed a 40-year aberration in judicial review of executive-branch power grabs, and today put a Corner Post through a dodge on due process.

Today's ruling in Corner Post v Board of Governors flew under the radar, thanks to the full attention given to Trump v US and the decision on presidential immunity. Justice Amy Coney Barrett jokingly apologized during her reading from the decision for talking about a case of much less interest. However, this may have a lot more import than it seems -- and when combined with Jarkesy and Loper Bright, offers a much more robust bulwark against the Rule of Whim, as exercised by the federal bureaucratic state.

At issue today was a bureaucratic Catch-22 on challenging regulations. The federal statute of limitation on challenges under the Administrative Procedure Act (APA) limits plaintiffs to a six-year period. Federal standing rules on lawsuits against regulatory agencies also prevent plaintiffs from filing such challenges until they can demonstrate particularized injury. So what happens when regulations passed in violation of the APA don't impact plaintiffs until more than six years later?

The Federal Reserve and the government argued that the answer should be tough luck, and that courts should start the clock when the rule becomes finalized. In a 6-3 decision written by Barrett, the Supreme Court rejected that argument and ruled that the clock on APA challenges starts with the actual injury, not finalization:

The Board contends that an APA claim “accrues” when agency action is “final” for purposes of §704—injury, it says, is necessary for the suit but irrelevant to the statute of limitations.2 We disagree. A right of action “accrues” when the plaintiff has a “complete and present cause of action”—i.e., when she has the right to “file suit and obtain relief.” Green v. Brennan, 578 U. S. 547, 554 (2016) (internal quotation marks omitted). An APA plaintiff does not have a complete and present cause of action until she suffers an injury from final agency action, so the statute of limitations does not begin to run until she is injured.

 Of particular importance to this case is the chronology of Corner Post itself, a truck stop that didn't open until 2018. The rule on debit-card fees got finalized in 2011, a year or so after the Dodd-Frank bill authorized its creation. As Barrett notes, Corner Post didn't even exist for a facial challenge based on the APA when the Board's interpretation of the statute of limitation ran out in 2017. Improperly crafted regulations would escape any challenge at all by those harmed by it under that interpretation, most pointedly by plaintiffs who didn't get subjected to such regulation during that period of challenge.

The board, and the dissenters in this opinion, argue that allowing a different interpretation would create reliance issues in enforcing regulations and introduce instability to compliance efforts. That is where Barrett declared tough luck:

Finally, the Board raises policy concerns. It emphasizes that agencies and regulated parties need the finality of a 6-year cutoff. After that point, facial challenges impose significant burdens on agencies and courts. Moreover, if they are successful, such challenges upset the reliance interests of the agencies and regulated parties that have long operated under existing rules. See also post, at 18–24 (JACKSON, J., dissenting). 

“[P]leas of administrative inconvenience . . . never ‘justify departing from the statute’s clear text.’” Niz-Chavez v. Garland, 593 U. S. 155, 169 (2021) (quoting Pereira v. Sessions, 585 U. S 198, 217 (2018)). Congress could have chosen different language in §2401(a) or created a general statute of repose for agencies. It did not.

This provides a significant connecting thread to Loper Bright, if not Jarkesy. In rejecting the Chevron doctrine in Loper Bright, Chief Justice John Roberts argued that the APA required judicial review of disputed interpretations, as written explicitly in the statute by Congress, and not an abdication to the bureaucrats' interpretations, especially in regard to interpretation of authority and jurisdiction. It certainly may be more convenient for bureaucrats when courts simply adopt their interpretations, such as the Clean Air Act applying to a non-pollutant like carbon dioxide, but that is not how Congress structured the APA or the enabling statutes for agencies like the EPA, the Securities and Exchange Commission, and so on. Neither can bureaucrats hide behind artificial deadlines to avoid challenges to deficient regulations. 

The context of Jarkesy was different, but the impact is similar. The SEC attempted to use authority granted by ambiguities within Dodd-Frank (again) to prosecute common-law crimes and torts outside of Article III control. That violated the Seventh Amendment right of jury trials in courts and allowed unelected bureaucrats to act as prosecutor, judge, and jury. If executive-branch bureaucrats accuse Americans of fraud or other crimes/torts in common law -- as opposed to technical compliance violations -- then those claims must be heard in Article III courts by juries. 

We can even add to this trio a fourth caae, Garland v Cargill, the "bump stock" case. Glenn Reynolds wrote about the decision reversing the ATF's ruling that a bump stock could be regulated like machine guns:

After the still-unexplained mass shooting in Las Vegas, the BATFE rewrote its regulations to treat “bump stocks” as “machine guns.”  Under the applicable statute, a machine gun is something that fires more than one round when the trigger is pulled.

Bump stocks don’t do that.  Instead, they make it possible for you to essentially hold your finger steady while the gun vibrates or bounces against it, causing the trigger to be pulled more rapidly than most people can do it with a finger alone.  But it’s still one trigger-pull per bullet leaving the barrel.

ATF argued, essentially, that the end result was kinda like a machine gun.  The Court held that “kinda like” isn’t enough for a criminal statute.  If Congress wants to make bump stocks illegal, it can (probably, subject to Second Amendment limitations)  pass a law banning bump stocks.  ATF, however, can’t pass laws.  All it can do is adopt regulations interpreting laws, and regulations interpreting laws so that those laws do things that Congress didn’t enact aren’t “interpretations “at all, but the equivalent of new laws, which only Congress can pass.

For many people, these rulings would be common sense and a return to self-governance and the responsibility of Congress to legislate properly, not a Bureaucrattedammerung. For those disciples of Woodrow Wilson who see self-governance as an impediment to preferred outcomes rather than a guarantor of liberty, this triumvirate of cases is an utter disaster. 

Justice Ketanji Brown Jackson, who earlier complained that the Bill of Rights constrained government (a feature, not a bug!), vents apocalyptically about the prospect of limited power again in a dissent to Corner Post:

At the end of a momentous Term, this much is clear: The tsunami of lawsuits against agencies that the Court’s holdings in this case and Loper Bright have authorized has the potential to devastate the functioning of the Federal Government. Even more to the present point, that result simply cannot be what Congress intended when it enacted legislation that stood up and funded federal agencies and vested them with authority to set the ground rules for the individuals and entities that participate in the our economy and our society. It is utterly inconceivable that §2401(a)’s statute of limitations was meant to permit fresh attacks on settled regulations from all new comers forever. Yet, that is what the majority holds today.

But Congress still has a chance to address this absurdity and forestall the coming chaos. It can opt to correct this Court’s mistake by clarifying that the statutes it enacts are designed to facilitate the functioning of agencies, not to hobble them.   

Well ... yeah. And that's the point. Congress has the exclusive prerogative and duty to legislate, not pass the buck for that function to unelected bureaucrats. In truth, Congress could have dictated opposite outcomes for all these cases -- except Jarkesy -- by crafting clear and unambiguous statutes. That would leave regulators to enforce such statutes without interpretation, and especially without constantly shifting interpretations, that allowed for vast and unauthorized expansion of their fiefdoms. 

The Supreme Court has decided that the Constitution and its separation of powers still matter. They didn't order an end to the bureaucratic state, or reverse Wickard v Filburn and other precedents that undergird it. But in this term, they have made it clear that Americans have every right and reason to hold it accountable to both the Constitution and to the terms of statutory law -- and if that panics the Left, then that speaks volumes about their commitment to the rule of law and ordered liberty. 

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