Assessing Procedural Legislation Review Under APA § 706(2)(D

Assessing Procedural Legislation Review Under APA § 706(2)(D)

This memorandum evaluates the procedural deficiencies of three proceedings undertaken by the EEOC concerning notice-and-comment rulemaking, focusing solely on procedural aspects under the Administrative Procedure Act (APA) § 706(2)(D). The APA authorizes courts to set aside agency actions deemed to have violated statutory or procedural requirements. The scenario involves three distinct proceedings: two proposed rulemakings and one enforcement action, each allegedly lacking proper oversight and compliance with procedural mandates, especially regarding OIRA review and comment responsiveness.

Analysis of Proceeding 1: Notice of Proposed Rulemaking and Final Rule

In Proceeding 1, the EEOC published a notice of proposed rulemaking (NPRM) on January 1, 2014, to interpret Title VII’s prohibition on employment discrimination “because of sex” to include discrimination based on gender identity. The agency requested comments by March 15, 2014. Subsequently, the EEOC issued a final rule on August 1, 2014, asserting that gender identity discrimination constitutes sex discrimination under Title VII, without responding to prior comments that challenged this interpretation.

Under the APA, agency rulemaking must follow a statutorily prescribed procedure, including providing meaningful notice, soliciting public comment, and adequately considering those comments. Critical procedural issues include:

• Failure to submit NPRMs and final rules to OIRA: The Office of Information and Regulatory Affairs (OIRA) plays a pivotal role in reviewing significant regulations under Executive Order 12866. Agencies are mandated to submit certain rulemakings for OIRA review, especially when the rules have economic implications exceeding specific thresholds. The scenario indicates that EEOC did not submit these proceedings to OIRA, which can render the process procedurally deficient.
• Incomplete consideration of public comments: The final rule notably failed to respond to several substantive comments, particularly those presenting legal and policy challenges against the inclusion of gender identity under sex discrimination. The APA requires agencies to articulate a rational connection between the facts found and the choice made, including addressing significant comments. Omitting this consideration constitutes a procedural flaw.
• Potential violation of notice requirements: The initial NPRM and final rule must be published in a manner accessible to the public, clearly state the legal authority, and provide an opportunity for meaningful comment. The agency's omission in addressing significant comments, especially sophisticated legal challenges, indicates a lack of proper procedural engagement.

Therefore, based solely on procedural grounds, the failure to seek OIRA review and the inadequate response to significant comments exposes the final rule to being set aside under APA § 706(2)(D).

Analysis of Proceeding 2: Enforcement Action Based on Final Rule

Proceeding 2 involves a penalty imposed on ABC Corporation for firing a transgender employee, citing the final rule from Proceeding 1. The agency’s enforcement decision was made via a letter, with no formal hearing, and it relied on the rule that was allegedly procedurally deficient in Proceeding 1.

The procedural issues here include:

• Reliance on a potentially invalid final rule: Since the final rule in Proceeding 1 may be unlawfully promulgated due to procedural violations, enforcing actions based on it could be unlawful.
• Lack of notice and opportunity to respond: The corporation was not provided a formal hearing or a chance to contest the rule’s validity before the adverse action, possibly violating due process rights associated with agency enforcement.

However, the primary concern remains whether the initial rule, serving as the foundation for the enforcement action, withstands procedural scrutiny. If the rule is invalidated, the enforcement likewise fails, making this proceeding procedurally deficient under the APA.

Analysis of Proceeding 3: Rulemaking Under the ADAAA Authority

Proceeding 3 was initiated with a proposed rulemaking citing authority under the ADAAA, and ultimately, the EEOC issued a final rule treating gender dysphoria as a disability, with a theoretical economic impact. Similar to Proceeding 1, the notice and rulemaking process did not involve OIRA review or engagement, and the agency provided a thorough analysis of the comments received.

Procedural deficiencies include:

• Lack of OIRA oversight: If the regulation is “significant,” as suggested by the economic impact statement, the agency was obliged to submit the rule to OIRA for review. Failure to do so constitutes a procedural violation under Executive Order 12866.
• Partial consideration of comments: Despite providing a detailed analysis, the process’s integrity depends on whether all significant comments, particularly those opposing the rule’s conclusion, were meaningfully considered. The scenario indicates a thorough review, which is generally acceptable, but the initial omission of OIRA review remains problematic.

Overall, the procedural issue hinges on whether the agency’s failure to include OIRA review invalidates the rule. Under the APA, a regulation promulgated without required OIRA review may be vacated due to procedural deficiencies.

Conclusion

In summary, the key procedural deficiencies that could lead to the invalidation of each proceeding are as follows:

• Proceeding 1: The failure to submit the NPRM and final rule to OIRA, combined with the inadequate response to significant comments, constitutes a violation of procedural requirements under APA § 706(2)(D). This undermines the validity of the rule, making it susceptible to being annulled by a reviewing court.
• Proceeding 2: Enforcement based on an unlawfully promulgated rule is itself procedurally invalid. Given the foundational procedural flaws in Proceeding 1, the enforcement action likely also fails to withstand judicial scrutiny.
• Proceeding 3: The absence of OIRA review for a rule with significant economic impact represents a procedural violation, potentially invalidating the regulation.

Therefore, the likelihood of judicial review invalidating these proceedings due to procedural deficiencies is high, particularly owing to violations of mandatory review and consideration procedures mandated by the APA and executive orders.

References

• 5 U.S.C. § 706(2)(D). Administrative Procedure Act.
• Executive Order 12866, Regulatory Planning and Review.
• United States v. Nova Scotia Food Products Corp., 568 F.2d 240 (2d Cir. 1977).
• Florida Power & Light Co. v. Lorion, 470 U.S. 729 (1985).
• California v. Azar, 941 F.3d 1064 (9th Cir. 2019).
• Health Care Ass'n of New York State v. Pataki, 300 F.3d 87 (2d Cir. 2002).
• Whitman v. American Trucking Ass'ns, Inc., 531 U.S. 457 (2001).
• United States v. Mead Corp., 533 U.S. 218 (2001).
• Motor Vehicle Manufacturers Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (1983).
• Public Citizen, Inc. v. Federal Election Commission, 933 F.2d 1479 (D.C. Cir. 1991).