My amicus cert petition in DOT v. Ass’n of American Railroads

April 11

I’ve just filed an amicus cert petition in DOT v. Ass’n of American Railroads, a recent D.C. Circuit case (opinion by Justice Janice Rogers Brown) striking down a delegation of regulatory authority to Amtrak on private non-delegation doctrine grounds. The petition was actually written by the Emory Law School Supreme Court Advocacy Project, which you may remember from Eugene’s posts on Scott v. Saint John’s Church in the Wilderness. (ELSSCAP wrote the art and photography historians’ brief in that case.) ELSSCAP also had a cert grant and a 9-0 win recently in Bullock v. BankChampaign, so they know what they’re doing.

Of course, I helped, and the basic ideas here are ones that I’m developing in a forthcoming article in Harvard Journal of Law and Public Policy. But technically speaking, I’m just the client, a con law, admin, and privatization scholar who’s interested in the sound development of these fields.

I’ve written about the case before, in a Reason.org blog post:

Amtrak, formally called the National Railroad Passenger Corporation, was created by statute in 1970. Faced with competition from other modes of transport, railroads that offered passenger service had been incurring heavy losses; many of these railroads had petitioned the Interstate Commerce Commission, which at the time regulated railroads, for permission to stop providing passenger service. With the passage of the statute, a railroad could transfer its passenger service responsibilities to Amtrak if it agreed to a number of conditions, one of which was to grant Amtrak the use of its tracks and other facilities. The statute provides that, except in an emergency, an Amtrak passenger car has precedence over another railroad’s freight car when they both need to use the same facilities. Most railroads agreed to these conditions, which were enshrined in a series of bilateral operating agreements.

Fast forward a few decades, to when Congress passed the Passenger Rail Investment and Improvement Act of 2008. One section of the new statute, § 207, required the Federal Railroad Administration (FRA) and Amtrak to “jointly . . . develop new or improve existing metrics and minimum standards for measuring the performance and service quality of intercity passenger train operations, including cost recovery, on-time performance and minutes of delay, ridership, on-board services, stations, facilities, equipment, and other services.” These performance measures aren’t of merely academic interest. Amtrak and its contractual partners are required to incorporate the measures into their operating agreements “[t]o the extent practical.” Perhaps more seriously, if “on-time performance” or “service quality” is substandard for two consecutive quarters, the Surface Transportation Board (STB), an independent agency housed in the Department of Transportation, is allowed to start an investigation (and is required to do so, if a complaint is filed) to check whose fault it is, and can assess damages against the host railroad if the problems are due to the railroad’s failure to grant preference to Amtrak trains.

These metrics and standards are supposed to be developed “jointly” by Amtrak and the FRA. If they can’t agree, they can petition the STB to appoint an arbitrator, whose decision will be binding. Amtrak thus has equal authority with the FRA on this issue; the FRA has to get Amtrak’s consent in developing the metrics and standards (or it has to abide by the decision of an arbitrator, who might also end up being private). The Association of American Railroads sued, charging that this sort of private delegation is invalid; and the D.C. Circuit agreed.

The main problem with the D.C. Circuit’s private non-delegation doctrine argument, though is that… there is no private non-delegation doctrine. It doesn’t exist. The Supreme Court uses the same non-delegation doctrine regardless of whether the delegate is public or private. The case the D.C. Circuit used to support a special doctrine that would be more skeptical of private delegations — Carter v. Carter Coal Co. (1936) — is actually a Due Process case, not a non-delegation case. My view is that this delegation violates due process, not non-delegation, so the D.C. Circuit got it right for the wrong reason.

Moreover, it makes a big difference which theory we adopt: a due process rationale also applies against the states, and due process challengers can get damages under § 1983 or Bivens, which they can’t if the basis for the opinion is the non-delegation doctrine.

Here’s the first part of ELSSCAP’s amicus brief on my behalf:

I. The D.C. Circuit’s private delegation doctrine finds no support in this Court’s precedent.

Limits on delegation of Congressional power fall into at least two categories: (1) the non-delegation doctrine, derived from the Vesting Clause of Article I; and (2) due process limits on delegation of regulatory authority, derived from the Fifth Amendment, which generally prohibit unfair treatment. Contrary to the D.C. Circuit’s holding, the non-delegation doctrine does not distinguish between private and public actors. A delegation of regulatory power to a biased party may implicate the Due Process Clause, but does not violate the non-delegation doctrine if circumscribed by an intelligible principle.

A. The non-delegation doctrine does not distinguish between private and public actors.

The non-delegation doctrine is derived from the Vesting Clause of Article I, Section 1 of the U.S. Constitution. Mistretta v. United States, 488 U.S. 361, 373 (1989). Rooted in separation of powers principles, the non-delegation doctrine prohibits Congress from delegating its legislative power. Id.

To prevent the delegation of any power from becoming a forbidden delegation of legislative power, Congress must provide an “intelligible principle to which the person or body authorized to [exercise the delegated authority] is directed to conform.” Id. This Court has found only two cases where such a requisite intelligible principle was lacking: Panama Refining Co. v. Ryan, 293 U.S. 388 (1935), and A.L.A. Schechter Poultry Corp v. United States, 295 U.S. 495 (1935). See Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 474 (2001) (identifying Panama and Schechter as the only two such cases “[i]n the history of the Court.”).

In Panama, the statute provided literally no guidance. As the Court wrote: “Congress has declared no policy, has established no standard, has laid down no rule. There is no requirement, no definition of circumstances and conditions in which the [regulated activity] is to be allowed or prohibited.” Panama, 293 U.S. at 430. In Schechter, the statute “conferred authority to regulate the entire economy on the basis of no more precise a standard than stimulating the economy by assuring ‘fair competition.’” Am. Trucking Ass’ns, 531 U.S. at 474 (citing Schechter, 295 U.S. at 495).

By contrast, delegations have been upheld where the intelligible principle was no more specific than that broadcast licenses be awarded in the “public interest,” that prices be set at “fair and equitable” levels, and that the structure of holding companies be modified so as not to be “unduly and excessively complicate[d].” Id. at 474 (citing Nat’l Broad. Co. v. United States, 319 U.S. 190, 216 (1943); Yakus v. United States, 321 U.S. 414, 420, 423–26 (1944); Am. Power & Light Co. v. SEC, 329 U.S. 90, 104 (1946)). The non-delegation cases show that the requirements for satisfying the intelligible principle are quite low.

The question before the Court is whether the statute authorizing Amtrak to act as co-equal with the FRA offers the requisite minimal intelligible principle to sustain the delegation under the non-delegation doctrine. The statute does provide such a principle: Amtrak “shall be operated and managed as a for-profit corporation.” 49 U.S.C. § 24301(a). This principle is intelligible enough to save the Congressional delegation from invalidity.

The D.C. Circuit adopted Respondent’s argument that delegation to a private party is a per se violation of the non-delegation doctrine. Ass’n of Am. Railroads v. U.S. Dep’t of Transp., 721 F.3d 666, 670 (D.C. Cir. 2013). This position has no support in this Court’s non-delegation cases. To the contrary, this Court upheld a delegation to private parties in Currin v. Wallace, 306 U.S. 1 (1939).

Currin concerned a challenge to the Tobacco Inspection Act of 1935. The Act authorized the Secretary of Agriculture to establish uniform standards for tobacco and designate tobacco markets where no tobacco could be sold unless it was inspected and certified according to those standards. But the Secretary was forbidden from designating a market unless two-thirds of the growers in that market voted in favor of such a designation in a referendum. Industry members thus held an “on-off” power to determine whether predetermined regulations would go into effect. Such a power has often been analyzed under the non-delegation doctrine. See Cargo of the Brig Aurora v. United States, 11 U.S. 382, 386 (1813); Marshall Field & Co. v. Clark, 143 U.S. 649, 694 (1892); Panama, 293 U.S. at 430. In Currin, this Court upheld the delegation to the industry members as being no worse than the delegation to the President upheld in J.W. Hampton, Jr., & Co. v. United States, 276 U.S. 394 (1928). Therefore, this Court held, the delegation did “not involve any delegation of legislative authority.” Currin, 306 U.S. at 15.

The fact that this Court has upheld a delegation to private parties by analogy to a similar delegation to the President—without expressing any reservations based on the private nature of the delegates—proves that the non-delegation doctrine does not distinguish between public and private parties.

B. The D.C. Circuit misconstrued due process cases to support a non-delegation analysis.

The D.C. Circuit purported to find a rule against private delegations in Carter v. Carter Coal Co., 298 U.S. 238 (1936). Ass’n of Am. Railroads, 721 F.3d at 670. But Carter Coal was not decided under the non-delegation doctrine.

It is true that, in Carter Coal, this Court disapproved a delegation of power to some members of industry to impose regulations on other members of industry. Carter Coal, 298 U.S. at 311. This was, the Court held, “legislative delegation in its most obnoxious form, for it is not even delegation to an official or an official body, presumptively disinterested, but to private persons whose interests may be and often are adverse to the interests of others in the same business.” Id. The mere recitation of the word “delegation,” however, does not imply an invocation of the non-delegation doctrine. See Larkin v. Grendel’s Den, Inc., 459 U.S. 116, 123 (1982) (holding that “delegating a governmental power to religious institutions” implicates the Establishment Clause). In fact, Carter Coal stated which part of the Constitution was implicated: “[A] statute which attempts to confer such power undertakes an intolerable and unconstitutional interference with personal liberty and private property. The delegation is . . . clearly arbitrary, and . . . clearly a denial of rights safeguarded by the due process clause of the Fifth Amendment . . . .” Carter Coal, 298 U.S. at 311.

This Court has more recently recognized, on multiple occasions, that Carter Coal is a due process case, not a non-delegation doctrine case. See Mistretta, 488 U.S. at 373 (listing Panama and Schechter as the only two cases to strike down statutes under the non-delegation doctrine, and omitting Carter Coal); accord Am. Trucking Ass’ns, 531 U.S. at 474; see also Synar v. United States, 626 F. Supp. 1374, 1383 n.8 (D.D.C. 1986) (Scalia, J.), aff’d sub nom. Bowsher v. Synar, 478 U.S. 714 (1986) (stating that, though Carter Coal “discussed” the delegation doctrine, the holding of the case “appears to rest primarily upon denial of substantive due process rights”).

Thus, while a delegation of regulatory power to a financially interested party may well violate the Due Process Clause, it does not violate the non-delegation doctrine provided an intelligible principle is present. The due process approach finds support in many of this Court’s cases. See, e.g., Eubank v. City of Richmond, 226 U.S. 137, 144 (1912); State of Washington ex rel. Seattle Title Trust Co. v. Roberge, 278 U.S. 116 (1928); Carter Coal, 298 U.S. at 311–312; Gibson v. Berryhill, 411 U.S. 564, 579 (1973). The private non-delegation approach, however, is not supported by a single case from this Court. And it is the non-delegation approach that the D.C. Circuit explicitly embraced. Ass’n of Am. Railroads, 721 F.3d at 670, 677 (refusing to consider Respondent’s Due Process argument).

Moreover, despite the D.C. Circuit’s statement that the difference between the non-delegation and due process approaches is purely academic, id. at 671 n.3, in fact there are substantial differences between the two approaches. Notably, they differ in whether state officials and agencies are also covered and in whether damages are available for successful challengers. These differences are covered further in Part III.

Sasha Volokh lives in Atlanta with his wife and three kids, and is an associate professor at Emory Law School. He has written numerous articles and commentaries on law and economics, privatization, antitrust, prisons, constitutional law, regulation, torts, and legal history.
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