JUDICIAL REVIEW OF REGULATORY ACTION

Standards for Judicial Review:

Law -- Policy -- FacT

To determine the standard under against which it should evaluate an agency's decision, courts distinguish among

I. Statements of Law,

II. Setting of Policy, and

III. Findings of Fact.

Generally speaking, courts are least bound by an agency's judgment on questions of law (i.e., statutory interpretation), and most bound by an agency's findings of fact, particularly on complex technical questions.[Vern Walker]

I. JUDICIAL REVIEW OF AGENCY INTERPRETATIONS OF STATUTORY LANGUAGE

  The Less Deferential Approach -- Judges as Decision‑Makers

Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984).

The U.S. Supreme Court held that if "Congress has directly spoken to the precise question at issue," and if "the intent of Congress is clear," then the court must interpret the statute as Congress intended.

Les v. Reilly, 968 F.2d 985 (9th Cir. 1992).

The petitioners sought judicial review of a final order of EPA, in which the agency permitted the use of four pesticides as food additives although EPA had found that these pesticides are carcinogens. The Delaney Clause of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. '348 (West 1972 and Supp. 1992), prescribed that additives found to induce cancer "when ingested by man or animal" could never be deemed "safe" for purposes of the statute. EPA had announced what the court called "a new interpretation of the Delaney Clause" -- namely, "the EPA proposed to permit concentrations of cancer‑causing pesticide residues greater than that tolerated for raw foods so long as the particular substances posed only a >de minimis' risk of actually causing cancer." The court held, however, that the language of the statute was "clear and mandatory," and that the legislative history of the Delaney Clause showed that "Congress intended the very rigidity that the language it chose commands." Moreover, throughout the 30‑year history of the provision, agencies had interpreted it "as an absolute bar to all carcinogenic food additives." The court therefore held that EPA's final order was contrary to the provisions of the food additives Delaney Clause.

  The More Deferential Approach -- Reasonable Agency Discretion

In Chevron, the U.S. Supreme Court went on to hold that if the statute is silent or ambiguous on the specific issue, then "a court may not substitute its own construction of a statutory provision for a reasonable interpretation made by the administrator of an agency." This does not mean that the agency always wins, but the standard of review is more deferential.

Leather Industries of America, Inc. v. EPA, 40 F.3d 392 (D.C.Cir. 1994).

The petitioners sought judicial review of standards issued by EPA for the use or disposal of sewage sludge from pre‑discharge sewage and wastewater treatment facilities. Part of the petition turned on EPA's interpretation of the Clean Water Act, as amended, which directed EPA to "identify those toxic pollutants which ... may be present in sewage sludge in concentrations which may adversely affect public health or the environment," and to specify management practices and numerical criteria "adequate to protect public health and the environment from any reasonably anticipated adverse effects of each pollutant," 33 U.S.C. '1345. EPA argued that it would be a permissible interpretation of the statute to use as a pollutant concentration cap (a numerical criterion) the 99th‑percentile concentration from a descriptive survey of pollutant concentrations actually present in current sludge output. The court applied a Chevron analysis, but held that neither of EPA's two proffered reasons provided adequate justification for EPA's interpretation. First, the court rejected EPA's explanation that when the 99th‑percentile concentration is lower than the allowable concentration "backcalculated" using a pathway exposure model, the 99th‑percentile concentration offers a "margin of safety" necessary to ensure "adequate protection." The court held that the statute required risk‑based regulations, and that the 99th‑percentile concentration was not risk‑based. Second, the court rejected EPA's explanation that use of the 99th‑percentile would prevent "backsliding" from current practices. The court held that "anti‑backsliding" regulations are legitimate only if the target standards are themselves risk‑based. Thus, EPA's interpretation of the statutory language was not permissible.

II. JUDICIAL REVIEW OF AGENCY POLICIES BEHIND AGENCY ACTIONS

  The "Softer" Approach

In reviewing agency action under the Administrative Procedure Act, 5 U.S.C. ' 706(2)(A), a court must "hold unlawful and set aside" actions found to be "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." This is generally regarded as a deferential standard.

Stauber v. Shalala, 895 F.Supp. 1178 (W.D. Wisc. 1995).

Consumers of commercially sold dairy products sought declaratory and injunctive relief against FDA, challenging FDA's approval of a new drug application for Posilac7, a milk‑production‑enhancing, synthetic bovine growth hormone. The court held that an FDA decision to approve such a drug is an informal agency action which "may be set aside only if the agency's determination is arbitrary and capricious, an abuse of discretion or otherwise not in accordance with the law." As the court explained: under this standard of review, "even if a reviewing court disagrees with an agency's action, the court must uphold the action if the agency considered all relevant factors and the court can discern a rational basis for the agency's choice." In one aspect of the case, for example, the court held that [a]lthough plaintiffs have raised valid concerns about the adequacy of the current regulatory scheme to assure the purity of the nation's milk supply, they have not shown the agency's reliance on that scheme to be arbitrary and capricious."