Okay, here are some thoughts on five more cases that cite/apply Kisor. This set is, in my view, far more interesting than the first (though the first case--Buffington v. Wilkie--is pretty boring Kisor-wise).
Buffington v. Wilkie, 31 Vet. App. 293 (Vet. App. July 12, 2019)
This is really a Chevron case. The Court holds that 38 C.F.R. 3.654(b)(2), which governs the effective date of recommencement of VA benefits following active duty, is consistent with 38 U.S.C. 5304(c)'s prohibition on receiving pension, compensation, or retirement pay on account of one's own service for any period during which one receives active service pay.
Judge Greenberg's dissent cites Justice Gorsuch's Kisor concurrence:
I respectfully dissent. “I would stop this business of making up excuses for judges to abdicate their job of interpreting the law, and simply allow the court of appeals to afford ‘a claimant’ its best independent judgment of the law's meaning.” Kisor v. Wilkie, ––– U.S. ––––, 139 S.Ct. 2400, 204 L.Ed.2d 841 (2019)(Gorsuch, J. concurring), vacating and remanding Kisor v. Shulkin, 869 F.3d 1360 (Fed. Cir. 2017), aff'g Kisor v. McDonald, No. 14-2811, 2016 WL 337517 (Vet. App. Jan. 27, 2016) (mem. dec.).
Sagarwala v. Cissna, 387 F. Supp. 3d 56 (D.D.C. July 15, 2019)*
Sagarwala challenged the United States Citizenship and Immigration Services' denial of her H1-B visa. Such visas are granted to foreign citizens employed in "specialty occupations." 8 U.S.C. 1101(a)(15)(H)(i)(B). Among other things, interested employers seeking H1-B visas for their employees must submit a petition to USCIS establishing the position the employee seeks to fill as a "specialty position" 8 U.S.C. 1361. USCIS has issued regulations establishing four ways that such "specialty" status can be shown. 8 C.F.R. 214.2(h)(4)(iii)(A).
Sagarwala challenged USCIS's interpretation of one of those four prongs, namely section 214.2(h)(4)(iii)(A)(1), which permits an employer to establish "specialty position" status by demonstrating that "[a] baccalaureate or higher degree or its equivalent is normally the minimum requirement for entry into the particular position." According to Sagarwala, in concluding that she had failed to meet that standard, USCIS treated section 214.2.(h)(4)(iii)(A)(1) as requiring “‘not just any baccalaureate or higher degree, but one in a specific specialty that is directly related to the offered position.’” She argued "that this interpretation is inconsistent with § 214.2(h)(4)(iii)(A)(1)'s language—which, again, refers solely to a degree, not one in a particular subject matter."
The Court rejected that argument explaining that "both the statutory and regulatory definitions of “specialty occupation” state that the position at issue must require the “attainment of a bachelor's or higher degree in [a] specific specialty.” 8 U.S.C. § 1184(i)(1)(B); see also 8 C.F.R. § 214.2(h)(4)(ii). "Accepting Sagarwala's proposed interpretation—under which any job requiring a bachelor's degree would be eligible," the Court reasoned, "risks expanding H-1B availability beyond those prescribed limitations."
The Court proceeded to explain that the regulatory framework arguably "compel[led] USCI's reading." Without actually deciding whether the regulation was in fact ambiguous, however, the Court concluded that the agency had "at a minimum," adopted "a reasonable reading of a regulatory provision that is susceptible to more than one interpretation." Then, citing Kisor, the Court explained that "Such a reading is typically entitled to judicial deference, unless it is 'plainly erroneous or inconsistent with the regulation.'” In the Court's view, USCIS's interpretation was neither. Instead, it reflected reflected "the agency's 'fair and considered judgment' on an issue falling within the agency's substantive expertise." Accordingly, the Court gave it "controlling weight" and rejected Sagarwala's claim.
In my view, the Court misapplied the Kisor standard in several respects. For starters, Kisor instructs courts to conduct their own independent assessment of the regulatory language before concluding whether the regulation is ambiguous or unambiguous. Court are not to defer to an agency's interpretation until they have concluded that the language is susceptible to more than one reasonable interpretation after exhausting all traditional tools of construction. Here, though, the Court defers without ever determining that the regulatory language is ambiguous and without even attempting to exhaust all traditional tools of construction.
Furthermore, the Court's willingness to defer to the agency's interpretation because it was neither "plainly erroneous" nor "inconsistent with the statute" looks an awful lot like the sort of "reflexive" approach that the Supreme Court warned about in Kisor.
Trawler Carolina Lady, Inc. v. Ross, 2019 WL 3213537 (E.D. N.C. July 16, 2019)*
Turns out, if you want to fish for scallops in American fisheries, you're going to have to deal with the National Marine Fisheries Service--a subagency of the Department of Commerce. The Magnuson Fishery Conservation and Management Act of 1976 created Regional Fishery Management Councils, which regulate scallop fishing through the development of fishery management plans for their respective regions. 16 U.S.C. 1852-53. When adopted, these management plans are implemented through NMFS regulations. 16 U.S.C. 1855. The fishery management plan at issue in this case established a "limited access system," which is basically a set of eligibility criteria and requirements that limits fishing in the region governed by the plan--here, the Atlantic Sea Scallop Fishery Management Plan.
NMFS subsequently memorialized the Management Plan in regulations, including one establishing a "limited access system" that requires anyone seeking to fish for scallops to apply for a "limited access scallop permit." The limited access system also regulates the "allocations of days-at-sea" (DAS) that vessels may fish for scallops and sets certain restrictions on consolidating DAS allocations.
Two regulations are particularly important in this case. The first, 50 C.F.R. 648.4(a)(1)(i)(g) says that with certain exceptions not relevant here, "limited access permits and DAS allocations may not be combined or consolidated." The second, 50 C.F.R. 648.14(i)(2)(iv)(B), makes it "unlawful for any person owning or operating a vessel issued a limited access scallop permit ... to ... [c]ombine, transfer, or consolidate DAS allocations."
Carolina Trawler Lady, Inc. sued the NMFS and others when the agency denied its request to transfer its limited access scallop permit for one vessel to another. In a letter explaining its reasons for denying the request, NMFS explained that Carolina Trawler Lady's request violated the prohibition on consolidating DAS allocations under the regulations just discussed. Specifically, the agency noted that the Carolina Trawler Lady, Inc.'s owner sought to transfer the permit he held for one vessel he owned to another vessel owned by his brother's company. Because the two brothers were in fact "one person" for purposes of the regulations, the proposed transfer would have constituted a forbidden consolidation of DAS.
Carolina Trawler argued that NMFS's decision ignored the plain language of 50 C.F.R. 648.4(a)(1)(G) and 648.14(i)(2)(iv)(B), which, in Carolina Trawler's view, unambiguously allowed the transfer proposed, without implicating the restrictions on consolidation of DAS. In support of its view, Carolina Trawler pointed to a memorandum written by an NMFS employee interpreting the prohibition on DAS consolidation. According to the memorandum, the "prohibition does not prohibit a vessel from fishing under two DAS allocations in one fishing year if the vessel, after using some or all of its DAS allocation under one permit holder, is then transferred to another permit holder to replace a vessel that has its own DAS allocation because one person would not be consolidating the DAS." Carolina Trawler argued that this proved that the consolidation restriction didn't apply to its application because Carolina Trawler, "as one person, did not fish under two allocations in one year, but only the vessel MISS TYLER (1), under ownership of two different persons [(the companies run by each brother)], fished two allocations."
The Court rejected that argument. Citing Kisor, the Court explained that it "need not apply Auer deference to uphold [the agency's decision] under the circumstances of this case" because
- the regulations "unambiguously" give the agency "authority to decline to authorize a transfer application on the ground that it would involve a consolidation of DAS allocations, as [the agency] stated here";
- other regulations that Carolina Trawler cited "do not unambiguously require a different result" but "rather, at most, create a 'genuine ambiguity'" (citing Kisor); and
- "plaintiff does not demonstrate how the pertinent regulations unambiguously foreclose defendants' interpretation or favor plaintiff’s interpretation."
I have several problems with this Court's approach to Kisor. For starters, the Court never says whether the regulatory language is genuinely ambiguous. True, it begins its analysis by declaring that it need not defer because the regulations are unambiguous, but the regulations it is talking about there merely provide for the agency's authority to decline a transfer request that would consolidate DAS allocations. Carolina Trawler doesn't deny that the agency has that authority. It argues instead that its transfer request would not consolidate DAS allocations under a proper interpretation of other regulations.
Adding to the confusion, the Court proceeds to acknowledge that other regulations Carolina Trawler relied on might create a genuine ambiguity, but it never says whether they actually do. Instead, the Court simply declares that Carolina Trawler failed to demonstrate how the regulations unambiguously foreclose the agency's interpretation and rules for the agency. That is not the approach Kisor requires. Under Kisor, the Court is supposed to conduct an independent evaluation of the regulatory language, exhausting all traditional tools of construction, to determine whether the language is genuinely ambiguous. That independent evaluation never happens here.
To be clear (haha), I'm not saying the Court reached the wrong conclusion. I'm focused exclusively on how carefully it adhered to the (admittedly very complicated) Kisor framework.
United States v. US Stem Cell Clinic, 2019 WL 465445 (S.D. Fla. July 19, 2019)*
This case is about FDA's attempt to stop stem cell clinics from operating and selling an adipose tissue derived product called Stromal Vascular Fraction. The idea behind the product is to have customers undergo a minor liposuction surgery to harvest stem cells that the customers could then use to treat various health issues.
On June 3, 2019, the U.S. District Court for the Southern District of Florida issued a permanent injunction against the product's maker, US Stem Cell Clinic, barring the company from performing STV-F procedures. In its memorandum opinion, the Court noted that Kisor was still pending before the Supreme Court and acknowledged that it might "eviscerate" Auer. Nevertheless, the Court proceeded to defer to FDA's interpretation of the relevant regulations under the pre-Kisor Auer framework. See United States v. US Stem Cell Clinic, LLC, 2019 WL 4648398, at *12 & nn.9-10 (S.D. Fla. June 3, 2019) (noting that Auer may be "eviscerated" by the Supreme Court in Kisor, but applying the pre-Kisor deference standard anyway).
US Stem Cell Clinic moved for clarification. Noting that the Court's injunction required the company to destroy thousand of banked stem cells within 31 days, US Stem Cells argued that complying with the injunction would require it to violate the property rights of the individuals from whom the stem cells were collected.
A couple of weeks after Kisor was decided, the Court entered another order--the one cited in bold and underlined above--staying the injunction. In that order, the Court insinuated that Kisor effectively blessed the Cour's prior conclusion that FDA's interpretation of the regulations was entitled to deference. 2019 WL 465445, at *1 ("Lastly, in-line with well-settled and recently affirmed Supreme Court precedent, in the Court’s Order on the Parties' Motions for Summary Judgment, the Court deferred to the FDA’s scientific expertise and its interpretation of the FDCA that the SVF Product is an adulterated and misbranded drug. See D.E. 73; Kisor v. Wilkie, 139 S. Ct. 2400 (2019) (affirming Auer v. Robbins, 519 U.S. 452 (1997)). Accordingly, the Court is not persuaded that any party has a property interest in the SVF Product because it is an adulterated and misbranded drug.").
I read the Court's pre-Kisor order entering the injunction. Let's just say the Court didn't anticipate all of the changes to Auer that the Supreme Court had in store for us in Kisor.
Braeburn Inc. v. FDA, 389 F. Supp. 3d 1 (D.D.C. July 22, 2019)*
Right up front, anyone as obsessed with Kisor as I am will want to know that this is the first case I've seen since Kisor that actually discusses the "active moieities" that Justice Breyer was so worked up about during the Kisor oral argument. See Braeburn, 389 F. Supp. 3d at 8 & n.3. Okay, now that we got the important stuff out of the way ....
The plaintiff, Braeburn Inc., and the intervenor, Indivior Inc., are pharmaceutical companies that each make drugs using buprenorphine, a safer alternative to methodone for treating opioid use disorder. Braeburn's product, Brixadi, delivers delivers buprenorphine through an injectable depot that releases buprenorphine over either a weekly or monthly period. In July 2017, Braeburn applied to the FDA for approval of Brixadi and, on December 21, 2018, received tentative approval for both Brixadi Weekly and Monthly. The critical hitch prompting this lawsuit is that, while Brixadi Weekly could receive final approval once Braeburn submitted proposed labeling to the FDA, Brixadi Monthly was not eligible for final approval until November 30, 2020. The delay was due to the three-year right to exclusivity under 21 U.S.C. § 355(c)(3)(E)(iii), belonging to Indivior's competing buprenorphine drug product, Sublocade, which also is an injectable depot that releases buprenorphine over a one-month period.
Braeburn sued the FDA, challenging the agency's determination that Brixadi Monthly cannot be finally approved until Sublocade's three-year exclusivity expires. Shortly after, Indivior intervened as a defendant. After the parties filed cross-motions for summary judgment, the Court ruled in favor of Braeburn, holding that FDA's interpretation of a provision of the Food Drug and Cosmetic Act failed at Chevron step two. As I'll explain below, despite the fact that the case involved judicial review of FDA's interpretation of a statute, the Court discussed Kisor extensively and held its framework applicable in the Chevron context.
The case is important for several reasons:
- The Court in Kisor cited Chevron at several points in its discussion of Auer deference, but it also repeatedly emphasized that the two standards are not the same. I've begun sorting out the relevant differences in a separate post on this blog, and there are many. So was Chief Judge Howell right to apply Kisor in the Chevron context?
- This is the first case I've seen where a court claiming to apply Kisor concluded both that the language at issue was ambiguous and that the agency's interpretation was not reasonable. Kisor warned us that is possible, but this is the first time I've seen an example in the wild.
- The Court's opinion raises other interesting questions regarding whether and to what extent Chevron (and Kisor?) step two and State Farm's arbitrary and capricious review standard overlap.