Justice Ginsburg in Encino

by Jeff Pojanowski — Tuesday, June 21, 2016

The administrative law professoriate is abuzz about the Supreme Court’s recent opinion in Encino Motorcars, LLC v. Naravrro . The 6-2 majority vacated and remanded the 9th Circuit’s rejection of a challenge to a Department of Labor regulation that would have entitled certain car dealership employees to overtime pay. Legal academics and administrative lawyers presently are puzzling over the implications that Justice Kennedy’s majority opinion may portend for Chevron deference. Is it a Step Zero opinion? Does it demonstrate that Step Two and State Farm arbitrary-and-capricious review are the same? Does it suggest that agency reversals are inherently suspect?

I will weigh in on none of these questions. What caught my eye was Justice Ginsburg’s concurring opinion, joined by Justice Sotomayor. Justice Ginsburg joined Justice Kennedy’s opinion, but she wrote separately to emphasize that the majority opinion is faithful to “well-established law” holding that there is no “‘heightened standard’ of arbitrary and capricious review” when an agency departs from a previous position. This comes from Justice Scalia’s opinion in FCC v. Fox Television Stations, 556 U.S. 502 (2009), which upheld agencies’ ability and right to change their minds on legal and policy positions, so long as they demonstrate awareness of such changes and take account of reliance interests.

My view of that position is more qualified, but that’s neither here nor there. Justice Scalia’s position inFox, embraced by Justice Ginsburg in Encino, is eminently defensible and coheres with a large chunk of doctrine and thinking on the administrative state. Of course, Justice Breyer in Fox also offered an eminently defensible dissent from the Scalia position. He argued that sometimes, at least, agencies should have to provide a more fulsome explanation when they change positions. And Justice Ginsburg joined Justice Breyer’s dissent in its entirety.

What changed Justice Ginsburg’s mind in the past seven years? Perhaps she wrote separately inEncino to underscore her approval of stare decisis as an abstract matter. Or, less facetiously, maybe she was just really annoyed with the FCC in Fox—she also wrote separately to question the constitutionality of the obscenity regulation in play there. Or maybe, if I allow myself a little cynicism here, Justice Ginsburg is quite comfortable with the types of policy changes the current administration (and likely the next administration) will put in place once they check the less-demanding boxes the late-Justice Scalia required in Fox (again, notwithstanding Justice Ginsburg’s pleas in 2009 for more rigor). That her Encino concurrence also offers the administration a game plan and justifications for future changes to the overtime rules only confirms this suspicion.

Again, one should be cautious about looking at admin law in Left/Right terms. But Justice Ginsburg’s (unexplained) volte face on administrative changes in policy raises this set of eyebrows, at least. And if I were a lawyer in this administration’s Department of Labor (or Education, or HHS) looking to advance the march of progress as I see it, after yesterday I would be more confident that I could count on Justices Ginsburg and Sotomayor in future arbitrary-and-capricious challenges. I’d be stunned if there would be a President Trump, but I’d also be very curious to see the fate of the Fox majority in that scenario.

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