March 25, 2019 9:26AM

Preview of Oral Arguments in Kisor v. Wilkie

On Wednesday morning, the Supreme Court will hear oral arguments in Kisor v. Wilkie, an important administrative law case in which the Court is reconsidering the Auer doctrine, or controlling deference to an agency’s regulatory interpretations.

The immediate controversy pertains to James Kisor, a Vietnam veteran whose claim for disability benefits hinged on the interpretation of the term “relevant” in the Board of Veterans Appeals rules of procedure. Only when the board denied Mr. Kisor’s claim did the agency announce its interpretation unprompted and without having been briefed on the matter. Obviously, Mr. Kisor was given no advance notice of the new “rule” — which was really just a new interpretation of the word. Mr. Kisor appealed the denial of his claim to the Veterans Court, which sided with the government. He then sought review of the Veterans Court’s decision before the U.S. Court of Appeals for the Federal Circuit, which, again, sided with the government. The three-judge panel determined that the term “relevant” was ambiguous, and that both parties had advanced reasonable interpretations. Nevertheless, the appellate court sided with the agency, based on the aforementioned Auer doctrine.

In December 2018, the Supreme Court granted Mr. Kisor’s petition for certiorari, but instead of limiting the case to the meaning of the agency’s rules, the Court chose to reconsider wholesale the Auer principle.

The problems with Auer deference are set forth in a brief supporting Mr. Kisor filed by Cato, joined by Professors Jonathan H. Adler, Richard A. Epstein, and Michael W. McConnell, as well as the Cause of Action Institute. We argue that Auer, by concentrating lawmaking and law-interpretation in regulatory agencies, both offends separation of powers principles and facilitates procedural shortcuts. Auer deprives regulated entities of fair notice, which is fundamental to the integrity of the law, and also robs administrative policymaking of legitimacy by allowing agencies to avoid public participation in the formulation of their rules. Finally, despite some predictions that overturning Auer will wreak havoc in administrative agencies, we point out that independent judicial assessment will change the outcome in only a small minority of cases. In sum, overturning Auer is an important step towards reining in the administrative state.

Astonishingly, the government’s brief largely agreed with us regarding the practical harms engendered by Auer. In a forthright section titled “Overly broad deference to agency interpretations can have harmful practical consequences,” the Solicitor General concedes that “[Auer] deference can discourage agencies from engaging in notice-and-comment rulemaking.” More importantly, the government proposes to mitigate these concerns by narrowing the doctrine, primarily by limiting its application to only those government regulatory interpretations that are consistent with past interpretations. While the government stops short of calling for an outright repeal of Auer, its proposed limitations would go a long way toward curing the doctrine’s ills.

At oral arguments, I expect lively exchanges. Again, the Auer doctrine is one of the most controversial principles in administrative law. As we note in our brief, at least four Justices have expressed reservations over or otherwise recognized criticisms of Auer. Justice Thomas has been the strongest critic, going so far as to doubt the doctrine’s constitutionality; perhaps he might be compelled to break his silence for the second time in a month.

I expect robust defenses of Auer from Justices associated with progressive values, perhaps in line with hyperbolic arguments raised by the doctrine’s proponents in academia and politics. In a prior post, I disputed exaggerated claims by legal scholars that overturning Auer would “threaten the foundations of the administrative state.” In a brief supporting the government, Sen. Sheldon Whitehouse proved even more overwrought, arguing that “this case is the product of a sustained effort [by ‘powerful influencers’] to disable public interest regulation.” In short, Auer’s proponents have ratcheted up the rhetoric, and their tone might reverberate during oral arguments.