Original Creator: jgersen
1. Statutory Authority. An administrative agency only has as much authority as its organic statute grants. If the statute giving the agency authority does not grant rulemaking authority, the agency cannot issue rules. If the statute does not allow the agency to regulate milk producers, the agency force milk producers to do anything. As the court said in this case, “the argument that the regulation is not supported by statutory authority cannot be dismissed out of hand.” The provision of the statute relied on <span class="caps">FDA</span> was the adulteration provision. The categories of adulteration prohibited in section 342 refer to food as an adulterated product rather than to the process of preparing food, except section (a)(4). The appellants argued that the prohibition on “unsanitary conditions” applies to the plant, not “conditions which merely inhibit the growth of organisms already in the food when it enters the plant in a raw state.” What is the court’s answer? At first glance, the court seems to agree with appellants, yet nevertheless sustain the regulation as within the grant of statutory authority. As the court says “when we are dealing with the public health, the language of the Food, Drug and Cosmetic Act should not be read too restrictively, but rather as ‘consistent with the Act's overriding purpose to protect the public health.’” That is, the <span class="caps">FDCA</span> seeks to protect public health. Even though the most natural reading of the statute does not really address risks that inhere in the raw food product, protecting the health is important enough to justify stretching the text of the statute to allow the agency to address this particular underling risk. <br />
2. Notice and Comment Rulemaking. The agency pronouncement at issue in Nova Scotia Food is known as a Rule or equivalently a Regulation. The Administrative Procedure Act establishes four default categories of agency action, formal rulemaking, informal rulemaking, formal adjudication, and informal adjudication. The last is a residual category. If an agency decision is not one of the first three categories, then it is informal adjudication. At the risk of sacrificing clarity for accuracy, a Rule resembles legislation. It establishes a set of general legal obligations on all regulated parties on a forward-going basis. An order more closely resembles a judicial decision, a backward-looking resolution of obligations for particular parties before the court. There are many nuances, but this classification is usually correct. An order must result for an adjudication. A Rule must result from a rulemaking. For a variety of reasons, most agencies have shifted to using informal rulemaking when they enact policy. Notwithstanding its name, informal rulemaking, otherwise known as notice-and-comment rulemaking involves the following steps: (1) The agency issues a Notice of Proposed Rulemaking which explains what the agency is considering doing; (2) Public Comments, today usually submitted via the internet, offering input on what the agency should do and why a particular course of action is good or bad; (3) issuance of a Final Rule together with a “concise statement of basis and purpose.” The statement of basis and purpose contain the agency’s responses to the comments it receives and an explanation of why it chose one particular course of action rather than another. When the new Rule is challenged in court, the litigation may involve several related claims.<br />
3. Notice. If the final Rule deviates too much from the proposed rule, regulated parties may challenge the initial Notice as inadequate. In order to obtain meaningful public input, the public must have a sense of what the agency might do. If the Notice details one course of action and the Final Rule another course of action entirely, the Notice may be found inadequate and the Final Rule struck down as invalid. <br />
4. Replying to Comments. If the statement of basis and purpose does not contain and adequate response to public comments, the final rule may be invalid. Indeed, if the Final Rule does not vary at all in response to comments, the agency, again, risks losing in court. <br />
5. Data and the Record. In order for public comments to be meaningful, regulated parties must be able to evaluate, critique, and respond to scientific studies and data on which the agency relies. Inadequate disclosure of those data may also render an agency decision vulnerable in litigation. <br />
6. Arbitrary and Capricious. Even if all of the above requirements are met, an agency rule resulting from informal rulemaking will be struck down if it is “) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” See 5 U.S.C. 706(2)(a). The administrative law literature contains many articles about what this standard of review does or ought to mean. At a minimum, however, the arbitrary and capricious standard requires that the agency explain the relationship between the facts in ther record and its ultimate conclusion. See Motor Vehicles Man. Ass’n v. State Farm Mutual Auto. Ins. Co., 463 U.S. 29 (1983). <br />
7. Food Law & Administrative Law. Just as many canonical constitutional law cases involve food, so too do many canonical administrative law cases involve food. Nova Scotia Foods is one of many.