Scalia Prepares to do a 360?

The Supreme Court decided Talk America, Inc. v. Michigan Bell on June 9, 2011.  The FCC says that the telephone company has to allow competitors to connect with their system so that we can call each other.  The rule is not in the statute or regulations, it is in an explanation of the regulations.  Just a plain old application of my pet peeve, Auer  v. Robbins.  Antonin Scalia wrote the opinion of the Court in Auer announcing the rule that when an agency interprets its own regulations that the Court will defer to that interpretation unless it is plainly erroneous.

Justice Scalia did not just sign on to the decision in Talk America.  Instead, Justice Scalia wrote a separate concurring opinion that says two things:  (1) he would reach the same decision in Talk America with Auer; and (2) he is ready to reconsider whether Auer should survive.  Hold on, my neck is sore from the snap.

Justice Scalia writes now "For while  I have in the past uncritically accepted that rule, I have become increasingly doubtful of its validity."  Uncritically accepted?  That is a true understatement.  It is more accurate that Justice Scalia has championed Auer deference.  Justice Scalia contrasts Auer with Chevron deference, saying that if Congress does not like the regulations that an agency promulgates it can amend the statute, preventing a complete merger of legislative and executive government functions.  Congress has an interest is keeping power and therefore does not have an incentive to issue vague statutes.

Justice Scalia contrasts the incentive of agencies to issue vague regulations so that they can do what they please in future adjudications.  That just is not a fair reading of the Auer doctrine.  The Courts do not defer to the agency's interpretation of a vague regulation when the agency is defending agency action.  The Courts defer to the agency's interpretation of a vague regulation when either the agency is not a party to the litigation or the interpretation is not part of the litigation itself, i.e. it was published independent of the litigation.  The stretch in the concurring opinion is unwarranted.

In closing out his concurrence, Justice Scalia states the Auer deference makes the Court's job easier and lends "certainty and predictability to the administrative process."  But that really is not the point.  While we want government to function and to be both certain and predictable, we want it for our own good and not for the good of either the agency or the courts.  The public needs to know what the statute and regulations mean. Unless we want the federal government to triple its annual output of statutory-regulatory morass, there will always exist from degree of ambiguity in what Congress and the agencies say.  We, as the public, need predictability and certainty in the administrative process.

Certainty and predictability have positive results for us.  Certainty and predictability decrease litigation.  You and I would not spends hundreds of thousands of dollars on a law suit when we both know the result.  Those cases get resolved quickly if they are ever filed.  But when the result is uncertain or unpredictable, then we proceed full steam ahead with litigation spending hundreds of thousands of dollars over garden variety ambiguity.

It would certainly be a different matter if the Court were persuaded that the presence of ambiguity in the regulations were an intentional subterfuge that Justice Scalia hints at in Talk America.  That would constitute a valid basis for rolling back Auer to curb administrative excess.  It comes down to "good faith."  If the agency's interpretation constitutes a good faith policy interpretation of a regulation that is vague, then the Court should defer to that interpretation.  If the agency's interpretation of a regulation is not a fair and considered judgment, then the Court ought not defer.  But that is already the law according to the Supremes.

For whatever the signal is about, Justice Scalia's hint that he might change Auer just adds to litigation and detracts from the certainty and predictability that we need to permit an ordering of our lives.  That is good for people and good for the economy.