In the 2005 Brand X decision, the Supreme Court held that “[a] court’s prior judicial construction of a statute trumps an agency construction otherwise entitled to Chevron deference only if the prior court decision holds that its construction follows from the unambiguous terms of the statute.” Nat’l Cable & Telecomms. Ass’n v. Brand X Internet Servs., 545 U.S. 967, 982 (2005). Where the court does not hold that the statute is unambiguous, “the agency may, consistent with the court’s holding, choose a different construction, since the agency remains the authoritative interpreter (within the limits of reason) of such statutes.” Id. at 983. That is, if a statute might mean A or B, and a court at time 1 says that the statute is ambiguous but that A is the better reading, and an agency at time 2 says that B is the better reading (and says so in a rule or order otherwise entitled to Chevron deference), the agency’s interpretation at time 2 trumps the court’s interpretation at time 1. Or so we thought. On Tuesday, in Gutierrez-Brizuela v. Lynch, a Tenth Circuit panel added a twist (a twist that turns Brand X almost entirely on its head): even if the agency at time 2 chooses interpretation B in a rule or order otherwise entitled to Chevron deference, the agency cannot apply interpretation B until a later date (time 3) at which the court “approves” the agency’s choice.

The panel’s holding is inconsistent with Brand X. It is also inconsistent with precedents from several other courts of appeals that have confronted similar scenarios. The Tenth Circuit ought to take the case en banc and reverse. If it doesn’t, and if the Supreme Court doesn’t intervene, Gutierrez-Brizuela will make quite a mess.

Before explaining why I think Gutierrez-Brizuela gets it wrong, a bit of background. Section 245(i) of the Immigration and Nationality Act says that an immigrant who entered the United States “without inspection” and who is the beneficiary of a petition filed by a relative on or before April 30, 2001, “may apply to the Attorney General for the adjustment of his or her status to that of an alien lawfully admitted for permanent residence.” The statute allows the Attorney General to grant an adjustment of status if the applicant pays a fee and satisfies certain other criteria. 8 U.S.C. § 1255(i). The Immigration Reform and Immigrant Responsibility Act of 1996 (IRIRA), however, says that “[a]ny alien who . . . has been unlawfully present in the United States for an aggregate period of more than 1 year . . . and who enters or attempts to reenter the United States without being admitted is inadmissible,” unless the person leaves the country for more than 10 years and then obtains consent from the Secretary of Homeland Security to reapply for admission. 8 U.S.C. § 1182(a)(9)(C). These two provisions raise the question whether IRIRA’s 10-year bar applies to immigrants who would otherwise be eligible for adjustment of status under section 245(i).

The Immigration and Naturalization Service initially said “no” in a general counsel memorandum and then said “yes” in an internal guidance memo. The Tenth Circuit finally addressed the question in a 2006 decision. The court noted that “the text itself gives no indication of which provision Congress intended to supercede the other,” and went on to say that the “legislative history,” “the underlying policies of the statutory scheme,” and “canons of statutory construction” all suggest that the 10-year bar does not prevent the Attorney General from adjusting the status of an immigrant who otherwise satisfies section 245’s criteria for relief. Padilla-Caldera v. Gonzales (Padilla-Caldera I), 453 F.3d 1237, 1242-44 (10th Cir. 2006).

In 2007, the Board of Immigration Appeals adopted a reading of section 245(i) and the IRIRA that differed from the Tenth Circuit’s. The Board issued a decision, In re Briones, 24 I. & N. Dec. 355 (2007), interpreting the IRIRA’s 10-year bar as applying even to immigrants who would otherwise be eligible for adjustment of status under section 245(i). The Tenth Circuit recognized that under Brand X, the agency’s interpretation superseded its own. The court said that the Board’s decision in Briones “provides a reasonable interpretation” of the interplay between section 245(i) and the IRIRA’s 10-year bar, “and is therefore the authoritative interpretation.” Padilla-Caldera v. Holder (Padilla-Caldera II), 637 F.3d 1140, 1152 (10th Cir. 2011) (citing Brand X, 545 U.S. at 983). “Accordingly,” the Padilla-Caldera II panel concluded, Briones “controls over our contrary decision” in Padilla-Caldera I. 637 F.3d at 1152.

Tuesday’s case continues the saga. It involves an immigrant, Hugo Gutierrez-Brizuela, who applied for adjustment of status after the Board of Immigration Appeals’ decision in Briones but before the panel’s decision in Padilla-Caldera II. At least for purposes of Tuesday’s decision, the panel assumes that Gutierrez-Brizuela would be eligible for adjustment of status under the Tenth Circuit’s decision in Padilla-Caldera I but not under the Board of Immigration Appeals’ decision in Briones. At this point, you might ask: But didn’t the Tenth Circuit say in Padilla-Caldera II that Briones is the “authoritative interpretation” and “controls over” Padilla-Caldera I? Doesn’t that settle matters? One might think so.

The Tenth Circuit panel thought not. “Until this court handed down Padilla-Caldera II,” the panel said, “Padilla-Caldera I remained on the books as binding precedent in the Tenth Circuit on which litigants were free (and expected) to rely, and Briones bore no legal force.” But wait. Doesn’t Brand X say that the agency’s interpretation is “authoritative” (at least where, as here, there is a statutory ambiguity and the agency’s interpretation is reasonable)? And isn’t Brand X authoritative in the Tenth Circuit (and everywhere else)?

Moreover, under Tuesday’s decision, how can an agency ever exercise its power under Brand X to adopt an interpretation at odds with a prior judicial decision? The Tenth Circuit panel offers the following explanation: “Agencies could seek to enforce their new interpretations and courts could then fulfill their Chevron step two and Brand X obligation to sustain those new interpretations while also affording the agency’s new rules only prospective effect and permitting the petitioner in the case at hand to continue to receive the benefit of preexisting judicial precedent.” So the Tenth Circuit is saying that if a court at time 1 says that the statute is ambiguous but A is the better reading, and the agency at time 2 says that in its view B is the better reading, then the agency should apply interpretation B to a regulated party and then hope that the regulated party challenges the agency’s action in court. And if the regulated party challenges the agency’s action in court, then the regulated party will win, because interpretation A is still controlling and the agency’s application of B is therefore unlawful. But in the process, the court may sustain the agency’s new interpretation prospectively. And then the agency is free to apply interpretation B going forward. (Whew.)

Here are just a few of the problems with the Tenth Circuit’s view:

— (1) It requires agencies to act unlawfully—and knowingly so—just to generate a test case in which the court can uphold the agency’s new interpretation prospectively.

— (2) In the test case, the regulated party challenging the agency’s (admittedly unlawful) action may have little incentive to argue against the agency’s new interpretation, because in any event the court’s old interpretation applies to her case. (In some situations, the regulated party will be a repeat player. But not always. Hugo Gutierrez-Brizuela will have his status adjusted to lawful permanent resident just once.)

— (3) The lag between time 2 (the time that the agency adopts the new interpretation) and time 3 (the time that the court approves the agency’s new interpretation) may be several years. Indeed, here, nearly 40 months passed between Briones (when the Board of Immigration Appeals said that the 10-year bar trumps the adjustment-of-status provision) and Padilla-Caldera II (when the Tenth Circuit said that, per Brand X, it would defer to the Board’s Briones decision). Add in the time for notice and comment (if the relevant agency interpretation takes the form of a legislative rule) and it could take longer than a full presidential term before an agency can implement what it believes to be the better reading of the statute.

— (4) The panel’s opinion will lead to legal disarray across the circuits on a wide range of issues. One advantage of Brand X is that when the courts of appeals are split on the interpretation of a statute that an agency administers, the agency can resolve the split by promulgating a rule warranting Chevron deference. This takes some of the burden off the Supreme Court to resolve each and every split that arises. But the panel’s opinion means that if the agency’s interpretation differs from the interpretation previously adopted by the Tenth Circuit, disuniformity will persist until the Tenth Circuit gets around to “approving” the agency’s view. Expect quite a bit of forum-shopping in the meantime.

— (5) And what of cases in which a district court has said that the best reading of the statute is A and the agency then adopts interpretation B in a rule or order entitled to Chevron deference? Will the district court’s prior decision prevent the agency from enforcing interpretation B? (Or not—because the district court’s decision is only persuasive, not binding, authority?) Similarly, how does the panel’s riff on Brand X apply to cases in which the earlier (or later) Tenth Circuit opinion is unpublished, and thus nonprecedential? (Can the Tenth Circuit delay the effective date of the agency’s new interpretation indefinitely by declining to publish its decision in each case where the issue arises?)

Perhaps the biggest strike against the Tenth Circuit panel’s view, however, is that it is plainly inconsistent with Brand X. Brand X says that “a court’s opinion as to the best reading of an ambiguous statute an agency is charged with administering is not authoritative,” because “the agency remains the authoritative interpreter . . . of such statutes.” Brand X, 545 U.S. at 983. The Tenth Circuit panel makes mincemeat of that holding. According to the panel, a court’s opinion as to the best reading of an ambiguous statute an agency is charged with administering is authoritative, and the agency only becomes the authoritative interpreter of such statutes when the court grants its “approval.” Even if that rule made sense (and I don’t think it does), it’s not a call that the Tenth Circuit gets to make now that Brand X called the shot the other way.

Two final observations. First, the one defense that I can come up with for the panel’s view is that it was hemmed in by Tenth Circuit precedent. And indeed, the Tenth Circuit did say in an earlier case (albeit in a footnote) that “[a]n agency in the Chevron step two/Brand X scenario may enforce its new policy judgment only with judicial approval.” De Niz Robles v. Lynch, 803 F.3d 1165, 1174 n.7 (10th Cir. 2015). Note, though, that the statement in De Niz Robles was not essential to the resolution of that case—and thus (at least arguably) dicta. The issue in De Niz Robles was whether the Board of Immigration Appeals could apply Briones “retroactively” to an immigrant who applied for adjustment of status after Padilla-Caldera I but before Briones. 803 F.3d at 1168. Tuesday’s case, by contrast, involves an immigrant who applied for adjustment of status after Briones. There is no genuine retroactivity concern in the latter case: the Board of Immigration Appeals announced its interpretation, then applied it to an application later in time. In any event, the author of De Niz Robles is the same judge who wrote Tuesday’s panel opinion—Judge Gorsuch—so it is a weak defense to say that his hands were tied by . . . himself. (I’ll add at this point that Judge Gorsuch is one of the best opinion writers on the courts of appeals. I think he misses the mark here, but that’s not to detract from an impressive record of bulls-eyes.)

Second, whether or not Tuesday’s opinion is foreordained by De Niz Robles, it appears to be at odds with the decisions of several other courts of appeals that have allowed agencies to exercise their powers under Brand X without judicial preapproval. See, e.g., Dominion Energy Brayton Point, LLC v. Johnson, 443 F.3d 12 (1st Cir. 2006); United States v. McGee, 763 F.3d 304, 314-15 (3d Cir. 2014); Puentes Fernandez v. Keisler, 502 F.3d 337, 348 (4th Cir. 2007); Metro. Hosp. v. HHS, 712 F.3d 248, 258 (6th Cir. 2013); Rush Univ. Med. Ctr. v. Burwell, 763 F.3d 754, 762 (7th Cir. 2014); Medina-Nunez v. Lynch, 788 F.3d 1103, 1104 (9th Cir. 2015). So this seems to me like a circuit split, though a lopsided one at that. I would think that if cert is granted, the Supreme Court’s vote would be lopsided as well. And not in the Tenth Circuit’s favor.

Cross-posted on Whatever Source Derived.

@DanielJHemel