The Proper Role of Ambiguity in the Chevron Analysis
by: Mat Gordon, Associate Editor, MTTLR
1 Terrell v. United States, 2007 U.S. Dist. LEXIS 72993 (E.D. Mich. 2007).
2 28 U.S.C. § 2241 (2006).
3 18 U.S.C. § 4208(e) (2006).
4 See Chevron, U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837 (1984); note that the Court spends a lot of time rejecting the analysis of the magistrate judge. Since the magistrate judge’s findings were not adopted, I will only address them when necessary to make a point.
5 Terrell, 2007 U.S. Dist. LEXIS 72993, *3.
6 Id.
7 Maybe some fanciful notion of the nondelegation doctrine.
Introduction
Can federal agencies redefine the law in the face of technological innovation? Terrell v. United States,1 a recent case decided in the district court of our very own Eastern District of Michigan, raises this issue. In this post, I will address the following specific question: does the court’s interpretation of “ambiguous” for application of the Chevron doctrine give Federal agencies too much power to interpret law in the face of technological innovation?
Terrell is serving a life sentence for murder in a federal penitentiary. His parole hearing was rescheduled several times before Terrell was finally informed that the hearing would be held by videoconference. Shortly thereafter, Terrell filed a petition for a writ of habeas corpus pursuant to 28 U.S.C. § 2241.2 The petition asserted that holding a parole hearing by videoconference was unlawful because 18 U.S.C. § 4208(e) requires that “[t]he prisoner shall be allowed to appear and testify on his own behalf at the parole determination proceeding.”3 Terrell argued that the word “appear” in the statute means being physically present at the parole hearing. The government argued that the Parole Commissioner’s interpretation – that “appear” can include appearing on a T.V. monitor – was correct.
Ambiguity in the Chevron Analysis
The District Court first held that the Parole Commissioner’s interpretation of the word “appear” is subject to the Supreme Court’s Chevron framework.4 The Chevron framework is applied when a court is asked to review an agency’s interpretation of the statutes that it applies. It is a two part analysis:
First, the court must determine if the meaning of the statute is clear. If the statute is clear, the agency’s interpretation is invalid unless it agrees with the statute.
Second, if the statute is ambiguous, then the court will defer to a reasonable agency interpretation.
As you might have guessed, whether a statute embodies a clear Congressional statement and whether an agency interpretation is reasonable can be subject to some play in meaning. The latitude an agency enjoys to interpret the statutes it applies will be related to how deeply the court is willing to dig to find a clear congressional statement, or an unreasonable interpretation.
In Terrell, the court rejected the magistrate judge’s finding that the word “appear” is ambiguous because of definitional ambiguity, or conflicting meanings of the word in the dictionary. Instead, the court held that the word “‘appear,’ as that word is used in § 4208(e) is not ambiguous when reviewed in the context by which the word is used”: it means a physical appearance.5
The court should have stopped there. If the meaning of the word is clear to the court as Congress contemplated it, then the Chevron analysis should be finished. Instead, the court decided that the word “appear” is ambiguous: meaning that the Commissioner’s interpretation must stand unless it is unreasonable. The court found that “when enacting § 4208(e), Congress could not have contemplated the use of video conferencing as it is currently utilized in our modern day judicial system. As such, this fact may create ambiguity in the word ‘appear.’”6
I believe that applying the logic underlying this statement generally would lead to unfortunate results. The court seems to be saying that an agency will gain the benefit of a presumption of deference when interpreting the law regarding issues Congress did not even address in the statute. I understand that Congress often delegates authority to agencies to make determinations, and that this authority often extends to reacting to new situations. This is not a problem in principle if the delegation of interpretive authority regarding new situations is clear. On the other hand, I do not believe that Chevron-style deference should apply in cases where Congress has not even contemplated whether a new technology should fit within a regulatory scheme.
Problems with Broad Adoption of the Court’s reasoning in Terrell
Consider an example. Assume that Congress creates an agency to ensure that all poor people living in the United States get health insurance. The agency’s organic statute states that “health insurance benefits shall be based on an applicant’s total assets, including any currency.” It is clear from the statute that currency means real money. After passage of the law, new technology allows creation of bank accounts in fictional online worlds where virtual items can be bought and sold. The secretary of the health insurance agency adopts a rule that virtual money held in these fictional worlds falls within the definition of “currency.”
Perhaps the secretary has a good reason to do this. Maybe some people are finding creative ways to turn the fictional money into real money. Still, it seems wrong to me that the secretary’s interpretation should not have a presumption of deference when Congress did not even imagine the possibility of this fictional money. Congress should be the one to decide whether a few people who are able to turn a real profit on fake money will lead to so much improper health insurance coverage that it should be included in the measure of total assets. Also, since the agency must fit its interpretation into the existing statute, a more nuanced solution could likely be reached by Congress because Congress can amend the statute.
One reply to this is that the second step of the Chevron analysis will save the day. Indeed, in Terrell, the court held that the Commissioner’s interpretation was unreasonable because it deprived the prisoner of his due process right. It is also possible that in the example above a court would invalidate the health insurance agency secretary’s interpretation because it is unreasonable. I believe that this would likely be the case in the most obvious examples of agency overreaching; however, I still worry that a significant number of agency interpretations that are completely outside the Congressional grant of authority would stand if the court’s reasoning in Terrell were adopted generally. Consider: if the second step of the Chevron analysis truly includes a presumption of deference unless the interpretation is unreasonable, then we can’t just say that the court should substitute its judgment for the agency’s.
Conclusion
In sum, I think the court went too far in extending the meaning of "ambiguity" in the Chevron framework to include technological innovations that Congress did not even contemplate. I am aware that agencies might be well-suited to make an informed decision regarding these issues. Still, on principle,7 I think that broad grants of interpretive deference to agencies should be based on more than a Congressional omission.
Can federal agencies redefine the law in the face of technological innovation? Terrell v. United States,1 a recent case decided in the district court of our very own Eastern District of Michigan, raises this issue. In this post, I will address the following specific question: does the court’s interpretation of “ambiguous” for application of the Chevron doctrine give Federal agencies too much power to interpret law in the face of technological innovation?
Terrell is serving a life sentence for murder in a federal penitentiary. His parole hearing was rescheduled several times before Terrell was finally informed that the hearing would be held by videoconference. Shortly thereafter, Terrell filed a petition for a writ of habeas corpus pursuant to 28 U.S.C. § 2241.2 The petition asserted that holding a parole hearing by videoconference was unlawful because 18 U.S.C. § 4208(e) requires that “[t]he prisoner shall be allowed to appear and testify on his own behalf at the parole determination proceeding.”3 Terrell argued that the word “appear” in the statute means being physically present at the parole hearing. The government argued that the Parole Commissioner’s interpretation – that “appear” can include appearing on a T.V. monitor – was correct.
Ambiguity in the Chevron Analysis
The District Court first held that the Parole Commissioner’s interpretation of the word “appear” is subject to the Supreme Court’s Chevron framework.4 The Chevron framework is applied when a court is asked to review an agency’s interpretation of the statutes that it applies. It is a two part analysis:
As you might have guessed, whether a statute embodies a clear Congressional statement and whether an agency interpretation is reasonable can be subject to some play in meaning. The latitude an agency enjoys to interpret the statutes it applies will be related to how deeply the court is willing to dig to find a clear congressional statement, or an unreasonable interpretation.
In Terrell, the court rejected the magistrate judge’s finding that the word “appear” is ambiguous because of definitional ambiguity, or conflicting meanings of the word in the dictionary. Instead, the court held that the word “‘appear,’ as that word is used in § 4208(e) is not ambiguous when reviewed in the context by which the word is used”: it means a physical appearance.5
The court should have stopped there. If the meaning of the word is clear to the court as Congress contemplated it, then the Chevron analysis should be finished. Instead, the court decided that the word “appear” is ambiguous: meaning that the Commissioner’s interpretation must stand unless it is unreasonable. The court found that “when enacting § 4208(e), Congress could not have contemplated the use of video conferencing as it is currently utilized in our modern day judicial system. As such, this fact may create ambiguity in the word ‘appear.’”6
I believe that applying the logic underlying this statement generally would lead to unfortunate results. The court seems to be saying that an agency will gain the benefit of a presumption of deference when interpreting the law regarding issues Congress did not even address in the statute. I understand that Congress often delegates authority to agencies to make determinations, and that this authority often extends to reacting to new situations. This is not a problem in principle if the delegation of interpretive authority regarding new situations is clear. On the other hand, I do not believe that Chevron-style deference should apply in cases where Congress has not even contemplated whether a new technology should fit within a regulatory scheme.
Problems with Broad Adoption of the Court’s reasoning in Terrell
Consider an example. Assume that Congress creates an agency to ensure that all poor people living in the United States get health insurance. The agency’s organic statute states that “health insurance benefits shall be based on an applicant’s total assets, including any currency.” It is clear from the statute that currency means real money. After passage of the law, new technology allows creation of bank accounts in fictional online worlds where virtual items can be bought and sold. The secretary of the health insurance agency adopts a rule that virtual money held in these fictional worlds falls within the definition of “currency.”
Perhaps the secretary has a good reason to do this. Maybe some people are finding creative ways to turn the fictional money into real money. Still, it seems wrong to me that the secretary’s interpretation should not have a presumption of deference when Congress did not even imagine the possibility of this fictional money. Congress should be the one to decide whether a few people who are able to turn a real profit on fake money will lead to so much improper health insurance coverage that it should be included in the measure of total assets. Also, since the agency must fit its interpretation into the existing statute, a more nuanced solution could likely be reached by Congress because Congress can amend the statute.
One reply to this is that the second step of the Chevron analysis will save the day. Indeed, in Terrell, the court held that the Commissioner’s interpretation was unreasonable because it deprived the prisoner of his due process right. It is also possible that in the example above a court would invalidate the health insurance agency secretary’s interpretation because it is unreasonable. I believe that this would likely be the case in the most obvious examples of agency overreaching; however, I still worry that a significant number of agency interpretations that are completely outside the Congressional grant of authority would stand if the court’s reasoning in Terrell were adopted generally. Consider: if the second step of the Chevron analysis truly includes a presumption of deference unless the interpretation is unreasonable, then we can’t just say that the court should substitute its judgment for the agency’s.
Conclusion
In sum, I think the court went too far in extending the meaning of "ambiguity" in the Chevron framework to include technological innovations that Congress did not even contemplate. I am aware that agencies might be well-suited to make an informed decision regarding these issues. Still, on principle,7 I think that broad grants of interpretive deference to agencies should be based on more than a Congressional omission.
1 Terrell v. United States, 2007 U.S. Dist. LEXIS 72993 (E.D. Mich. 2007).
2 28 U.S.C. § 2241 (2006).
3 18 U.S.C. § 4208(e) (2006).
4 See Chevron, U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837 (1984); note that the Court spends a lot of time rejecting the analysis of the magistrate judge. Since the magistrate judge’s findings were not adopted, I will only address them when necessary to make a point.
5 Terrell, 2007 U.S. Dist. LEXIS 72993, *3.
6 Id.
7 Maybe some fanciful notion of the nondelegation doctrine.
Labels: chevron, criminal procedure, videoconferencing
posted by MTTLR Blog Editor at
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