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.