D.C. Circuit Review – Reviewed: Skiing, Snowboarding, and State Action

by Aaron Nielson — Saturday, Apr. 23, 2016@Aaron_L_Nielson

Is there a constitutional right to snowboard? Before answering, know that Utah takes its snow very seriously—as it should. Few places have even a credible claim to “the greatest snow on Earth.” Utah is one of them (as is Hokkaido Island in Japan). But should that snow be used for skiing, snowboarding, or both? Again, before answering, know that one of the world’s great ski resorts is Alta. And I mean ski resort—at Alta, “snowboarders are banned, and posers discouraged.” That decision irks snowboarders. So does Alta’s decision violate Equal Protection?

Earlier this week, that question came before the Tenth Circuit. That court, however, did not resolve whether Alta’s ban on snowboarding is supported by a rational basis or instead is simply the product of irrational animus against snowboarders. (It appears, for instance, that the general manager of Alta has declared that “‘anyone who uses the words rip, tear, or shred will never be welcome at Alta,’ and that ‘as long as [he is] alive snowboarders will never be allowed at Alta.’”)

The Tenth Circuit did not resolve the constitutional question because of the “state action doctrine. The panel explained that although “Alta operates its ski resort on federal land via a permit issued by the United States Forest Service—a permit that requires the Forest Service to annually review and approve Alta’s site management plan,” that was not enough to make the decision to bar snowboarders a “government“ decision. Indeed, “Alta Ski Area is not ‘indispensable’ to the Forest Service’s purpose. The Forest Service, by virtue of the Alta permit, does receive approximately $400,000 each year in fees, but this amounts to only 0.1% of its annual budget.” Nor does the Forest Service control “the funding, creation, and financial structure of the ski area.” Thus, the Tenth Circuit rejected the constitutional claim without ever getting to the merits. (Rick Garnett has thoughts over at Prawfsblawg; pay attention to the comments too).

At this point, you’re probably thinking two thoughts. First, “no, there is no constitutional right to snowboard. Come on.” But second, “what does this Tenth Circuit decision have to do with the D.C. Circuit? Utah is a long way from D.C.”

Here is the connection. The state action doctrine is not a bright-line test, but yet courts, of necessity, muddle through. This murkiness is the sort of problem that the D.C. Circuit deals with all the time because administrative law often boils down to questions of degree rather than kind. For instance, almost everything an agency does is a little bit arbitrary—after all, an agency could always spend more time thinking about the problem. But arbitrary does not necessarily mean capricious. Likewise, when does an injury become too “speculative” for standing purposes? Is an issue “fit” for pre-enforcement review? Is it a political question under Baker v. Carr? Is this statue ambiguous enough to justify deference? Is this a logical outgrowth? And so on. All of these are questions of degree.

This week’s D.C. Circuit cases fit that pattern. The most interesting case, for instance, is Lancaster Symphony Orchestra v. NLRB. Judge Tatel, joined by Judges Pillard and Williams, confronted whether members of an orchestra are employees or independent contractors. If they are employees, then they can be unionized; otherwise, the statue does not apply. Unfortunately, there is no clear line between these two types of workers. (The D.C. Circuit has previously quoted this paragraph: “‘There have been many attempts to define precisely what is meant by the term independent contractor; but the variations in the wording of these attempts have resulted only in establishing the proposition that it is not possible within the limitations of language to lay down a concise definition that will furnish any universal formula, covering all cases. At last, and in any given case, it gets back to the original proposition whether in fact the contractor was actually independent.’” Some help.) The problem is that in almost every case, some factors point in favor of independence while others point the other way. This is certainly true in the cases that are litigated all the way to the D.C. Circuit. Indeed, presumably, companies sometimes design their contracts in such a way to get close to the line.

Here, the panel concluded, in large part, that the orchestra members are employees because:

The Lancaster Orchestra regulates virtually all aspects of the musicians’ performance. It controls their posture, including prohibiting them from crossing their legs, and requires them to remain attentive throughout the performance. Musicians must confine conversations during rehearsals to matters concerning the rehearsal, and they may not talk at all during tuning or when the conductor is on the podium. Musicians must warm up quietly and never interfere with the concentration of others. And when the conductor signals for the orchestra to acknowledge applause, the musicians must stand immediately, turn to face the audience, and smile. The Orchestra, moreover, enforces these rules. …

Even more significant, the Lancaster Orchestra’s conductor exercises virtually dictatorial authority over the manner in which the musicians play. The principal trombonist testified that the conductor determines when musicians come in, as well as their volume and pitch.

That’s no doubt right, as far it goes. But here is why the question is hard: What if we stepped back and looked at the situation more broadly? Sure, when it is actually performing, the conductor has a great deal of control. But what about how, and when, and where the members practice? A great deal (most?) of the work of a musician is individual practice. If the orchestra does not control that part of the musician’s life, then does it really control the musician? Surely almost every independent contractor does some things that, if viewed in isolation, falls within the control of the “employer,” so long as the activity is discretely defined. The line-drawing is thus difficult (especially here because the orchestra members are perfectly free to say “no thanks, I don’t want to work for you today because someone else will pay me more money”). I’m not sure who is right—precedent cuts both ways. But the opinion does illustrate why these cases are hard.

Next, consider Williams v. Lew. This opinion by Judge Sentelle (joined by Judges Tatel and Griffith) concerns whether the Debt Limit Statute is constitutional. Williams owns public debt; he doesn’t think the United States should default on that debt. Because the Debt Limit Statute, in operation, may allow Congress to not fund the government, Williams says his investment may be harmed. But does he have standing to bring the challenge? The Court concluded he does not: “Unfortunately for Williams, his claims of future injuries are entirely conjectural. It is indisputable that the United States has never defaulted on its debt obligations.” Indeed:

As the district court correctly noted, any future injury that Williams might suffer follows from an extended chain of contingencies. In particular: (1) federal debt must reach the statutory ceiling; (2) the Treasury Department must exhaust any “extraordinary measures” to avoid a default; (3) the United States must be unable to pay its obligations with “cash on hand” in a given day; (4) payment on Williams’s securities must come due during such time; and (5) Williams must continue to hold those securities. Furthermore, Congress must fail to enact legislation suspending or increasing the debt limit despite an impending breach of the statutory ceiling—something it has done on over seventy occasions since 1962.

Yet again, whether something is too speculative is surely a question of degree rather than kind.

To be sure, some of the other cases this week are more straightforward. For instance, in Cactus Canyon Quarries, Inc. v. MSHR, Judge Edwards (joined by Judges Kavanaugh and Wilkins) had to determine the meaning of “prevailing party.” The agency issued citations against a mining company. But afterwards, “before any hearings were held, the Secretary decided to vacate the citations and moved to have the ALJ dismiss the proceedings.” The ALJ didn’t say if the dismissal was with prejudice. Was the mining company a prevailing party for purposes of attorneys’ fees? The D.C. Circuit, applying precedent, concluded it was not. Likewise, in CostCommand, LLC v. WH Administrators, Inc. Judge Tatel (joined by Judges Griffith and Kavanaugh) concluded there was not personal jurisdiction because of the Supreme Court’s “nerve center” test (though even that test, which is supposed to simplify the inquiry, does not eliminate all hard cases). Finally, in Cohen v. Board of Trustees, Judge Griffth—joined by Judges Millett and Pillard—decided a procedural question about whether an extension to file a pleading should have been granted. Long story short, the panel concluded the district court did not abuse its discretion by not granting an extension, but it should not have dismissed with prejudice.

There you a go—a week of line drawing in the D.C. Circuit. And what’s the takeaway? Obviously, that snowboarders ruin the snow.

*The state action is often ignored. Colloquially, for instance, many speak of private entities “violating the First Amendment,” even though that is impossible.

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About Aaron Nielson

Professor Nielson is an associate professor at Brigham Young University Law School, where he teaches and writes in the areas of administrative law, civil procedure, federal courts, and antitrust. He currently serves as a public member of the Administrative Conference of the United States, a federal agency that studies the administrative process and makes recommendations on ways to improve it. He also co-chairs the Rulemaking Committee of the American Bar Association’s Section of Administrative Law & Regulatory Practice. Previously he chaired the Section's Antitrust & Trade Regulation Committee. Before joining the academy, Professor Nielson was a partner in the Washington, D.C. office of Kirkland & Ellis LLP (where he remains of counsel). He also has served as a law clerk to Justice Samuel A. Alito, Jr. of the U.S. Supreme Court, Judge Janice Rogers Brown of the U.S. Court of Appeals for the D.C. Circuit, and Judge Jerry E. Smith of the U.S. Court of Appeals for the Fifth Circuit. Follow him on Twitter @Aaron_L_Nielson.

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