Electronic Code of Federal Regulations (e-CFR) Title 13—Business Credit and Assistance CHAPTER I—SMALL BUSINESS ADMINISTRATION PART 134—RULES OF PROCEDURE GOVERNING CASES BEFORE THE OFFICE OF HEARINGS AND APPEALS Subpart D—Rules of Practice for Appeals Under the 8(a) Program § 134.406 Review of the administrative record.
13 CFR § 134.406 - Review of the administrative record.
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(a) Any proceeding conducted under § 134.401(a) through (d) shall be decided solely on a review of the written administrative record, except as provided in § 134.407 and in suspension appeals.
For suspension appeals under § 134.401(e), see § 124.305(d) of this chapter.
(b) Except in suspension appeals, the Administrative Law Judge's review is limited to determining whether the Agency's determination is arbitrary, capricious, or contrary to law. As long as the Agency's determination is not arbitrary, capricious or contrary to law, the Administrative Law Judge must uphold it on appeal.
(1) The Administrative Law Judge must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment.
(2) If the SBA's path of reasoning may reasonably be discerned, the Administrative Law Judge will uphold a decision of less than ideal clarity.
(c) The administrative record.
(1) The administrative record must contain all documents that are relevant to the determination on appeal before the Administrative Law Judge and upon which the SBA decision-maker, and those SBA officials that recommended either for or against the decision, relied.
The administrative record, however, need not contain all documents pertaining to the petitioner.
For example, the administrative record in a termination proceeding need not include the Participant's entire business plan file, documents pertaining to specific 8(a) contracts, or the firm's application for participation in the 8(a) BD program if they are unrelated to the termination action. The SBA may claim privilege as to certain materials.
(2) The petitioner may object to the absence of a document, previously submitted to, or sent by, SBA, which the petitioner believes was erroneously omitted from the administrative record. The petitioner also may object to a claim of privilege made by the SBA.
The petitioner's objections must be filed and served no later than 10 days of its receipt of the administrative record.
(3) In the absence of any objection by the petitioner or a finding by the Judge pursuant to paragraph (e) of this section that the record is insufficiently complete to decide whether the determination was arbitrary, capricious, or contrary to law, the administrative record submitted by SBA shall be deemed complete.
(d) Where the Agency files its response to the appeal petition after the date specified in § 134.206, the Administrative Law Judge may decline to consider the response and base his or her decision solely on a review of the administrative record.
(e) Remand.
(1) The Administrative Law Judge may remand a case to the Director, Office of Business Development (or, in the case of a denial of a request for waiver under § 124.515 of this chapter, to the Administrator) for further consideration if he or she determines that, due to the absence in the written administrative record of the reasons upon which the determination was based, the administrative record is insufficiently complete to decide whether the determination is arbitrary, capricious, or contrary to law. In the event of such a remand, the Judge will not require the SBA to supplement the administrative record other than to supply the reason or reasons for the determination and any documents submitted to, or considered by, SBA in connection with any reconsideration permitted by regulation that occurs during the remand period. After such a remand, in the event the Judge finds that the reasons upon which the determination is based are absent from any supplemented record, the Judge will find the SBA determination to be arbitrary, capricious, or contrary to law.
(2) The Administrative Law Judge may also remand a case to the Director, Office of Business Development (or, in the case of a denial of a request for waiver under § 124.515 of this chapter, to the Administrator) for further consideration where it is clearly apparent from the record that SBA made an erroneous factual finding (e.g., SBA double counted an asset of an individual claiming disadvantaged status) or a mistake of law (e.g., SBA applied the wrong regulatory provision in evaluating the case).
(3) The Administrative Law Judge may remand an eligibility, early graduation, or termination appeal to the Director, Office of Business Development, where the determination raises a new ground that was not in the initial SBA determination.
(4) A remand under this section will be for a reasonable period.
[63 FR 35766, June 30, 1998, as amended at 67 FR 47250, July 18, 2002; 74 FR 45754, Sept. 4, 2009; 75 FR 47443, Aug. 6, 2010; 81 FR 48595, July 25, 2016]
/// Key points ///
Completing the Record
The most frequently invoked rationale for supplementing an
administrative record is that the agency failed to include all of the
documents or materials that it actually considered.
Because the APA
provides that judicial review shall be based on the whole record,
supplementation of the record is appropriate in this situation.37
37. See Portland Audubon Soc. v. Endangered Species Comm., 984 F.2d
1534, 1548 (9th Cir. 1993).
"It is black-letter administrative law that in an [APA] case, a reviewing
court should have before it neither more nor less information than
did the agency when it made its decision."38
38. CTS Corp. v. EPA, 759 F.3d 52, 64 (D.C. Cir. 2014) (citations omitted).
"An agency may not scrub the record of all evidence that does
not support the agency's final decision."39
39. Fort Sill Apache Tribe v. NIGC, 345 F. Supp. 3d 1, 10 (D.D.C. 2018).
It may not exclude pertinent but unfavorable information.
"Nor may the agency exclude information on the grounds that it did not 'rely' on the excluded
information in its final decision."40
40. Fund for Animals v. Williams, 249 F. Supp. 2d 49, 55 (D.D.C. 2003)
(citations omitted).
It "cannot exclude evidence and
materials that were available to the agency as part of its decision
making process just because the ultimate decision maker did not
consider or use that information in coming to his final decision."41
41. Ohio v. U.S. Army Corps of Eng'rs, No. 1:15 CV 679, 2015 WL
7575935, at *2 (N.D. Ohio Nov. 25, 2015).
Instead, an agency "must produce the full record that was before
the agency at the time the decision was made."42
42. Blue Ocean Inst. v. Gutierrez, 503 F. Supp. 2d 366, 369 (D.D.C. 2007);
accord Stand Up for California! v. U.S. Dep't of Interior, 71 F. Supp. 3d 109,
117 (D.D.C. 2014)
The agency enjoys a presumption that it properly designated
the administrative record.43
43. See Bar MK Ranches v. Yuetter, 994 F.2d at 739-40.
Nonetheless, "[a]
plaintiff can make a
prima facie showing that an agency excluded adverse information
from the record by proving that the documents at issue
(1) were known to the agency at the time it made its decision,
(2) are directly related to the decision, and
(3) are adverse to the agency's decision."44
44. Fund for Animals v. Williams, 391 F. Supp. 2d 191, 198 (D.D.C. 2005)
(internal quotations omitted).
"Agency consideration is a touchstone of a motion to
complete the record—the addition of relevant documents that were
considered, directly or indirectly, by the agency decisionmaker at
the time of the decision are properly part of the record."45 "
45. Fort Sill Apache Tribe v. NIGC, 345 F. Supp. 3d at 9.
On a motion to complete the record, a plaintiff must 'put forth concrete
evidence and identify reasonable, non-speculative grounds for [its]
belief that the documents were considered by the agency and
not included in the record.'"4646. Id. (quoting Oceana, Inc. v. Ross, 290 F. Supp. 3d 73, 78-79 (D.D.C.
2018)).
For example, "it is
axiomatic that documents created by an
agency itself or otherwise located in its files were before it."47
47. Cty. of San Miguel v. Kempthorne, 587 F. Supp. 2d 64, 76 (D.D.C.
2008).
Source documents cited by the agency but missing from the
administrative
record can be added to it.
"[C]itation of a source to support
a factual proposition is
generally enough to manifest actual consideration by the agency and support inclusion in the record."48
48. Standing Rock Sioux Tribe v. U.S. Army Corps of Eng'rs, No. 16-1534,
2019 WL 2028709, at *3 (D.D.C. May 8, 2019).
Likewise, where the data necessary to make an estimate in an agency decision is
contained in a particular file, that file should be included in the
record.49
49. See Univ. of Colorado Health at Memorial Hosp. v. Burwell, 151
F. Supp. 3d 1, 19 (D.D.C. 2015).
And
correspondence related to a pending agency decision
should be included as part of the administrative record.50
50. See McDonnell Douglas Corp. v. National Aeronautics & Space
Admin., 981 F. Supp. 2d, 14 (D.D.C. 1997), rev'd on other grounds, 180 F.3d
303 (D.C. Cir .1999); Thompson v. U.S. Dept. of Labor, 885 F.2d 551, 555-56
286 The Journal of Federal Agency Action [1:275
(9th Cir. 1989); Sierra Pacific Industries v. U.S. Dept. of Agriculture, No. CIV
S-11-1250, 2011 WL 6749837, at *2 (E.D. Cal. Dec. 22, 2011).
Where
a sufficient showing is made that relevant documents
have been omitted from the administrative record, a court may
order
limited discovery as to the completeness of the record.51
51. See Dopico v. Goldschmidt, 687 F.2d 644, 654 (2d Cir. 1982); Bar MK
Ranches v. Yuetter, 994 F.2d at 740.
If a court concludes that
the record produced "clearly do[es] not
constitute the 'whole record' compiled by the agency," it will order
the agency to complete the record.52
52. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. at 419
(quoting 5 U.S.C. § 706).
"Completion [of the administrative record] entails ensuring
that the entire record is before the court—the addition of those
documents that influenced the agency in its decisionmaking [rather
than] the addition of newly created evidence or of documents that
were not before the agency when the decision was made, but should
have been. . . ."53
Thus, completing the record does not involve
any intrusion into the decision-making of the agency, but rather
Demonstrating That the Agency Failed to
Consider All Relevant Factors
Courts permit supplementation of the administrative record
to demonstrate that the agency failed to consider all the relevant
factors.54
"It will often be impossible, especially when highly technical
matters are involved, for the court to determine whether the
agency took into consideration all relevant factors unless it looks
outside the record to determine what matters the agency should
have considered but did not."55
To satisfy this exception, "the document
in question must do more than raise 'nuanced points' about a
particular issue; it must point out an 'entirely new' general subject
matter that the defendant agency failed to consider."56
In one case, for example, the plaintiff proffered an expert
declaration to show that the agency had failed to consider several
different issues.
The court found that the existing record was sufficient
to show whether the agency had considered one issue, and
so refused to admit that portion of the declaration.
In contrast, the record was silent as to two other issues and so the court admitted
those portions of the declaration to determine whether the agency
had considered them. The court also permitted the agency to submit
a declaration from its own expert to address the purported gaps
in the record.57
The key question, in practice, often becomes at what level of
generality the relevant factors are defined.58
The more broadly the factor is defined, the more likely it is that the agency will have
considered it in some fashion; conversely, if the factor is defined
more narrowly, the likelihood increases that the agency will not
have considered it specifically.
Demonstrating That the Agency Considered
Impermissible Factors
Courts also consider extra-record evidence to determine if an
agency considered factors left out of the administrative record.59
There are relatively few decisions discussing this issue.
The reason may be that this issue often arises in situations where it is alleged
that the agency's explanation for its action is pretextual, and this
issue is subsumed in the analysis of whether the agency acted
improperly or in bad faith (a topic discussed below).
282 The Journal of Federal Agency Action [1:275
One district court ruled that plaintiffs had failed to make a sufficient
showing of agency bad faith or improper behavior to warrant
discovery, but concluded that they had sufficiently alleged that the
agency considered an impermissible factor—political pressure—to
potentially warrant limited discovery and supplementation of the
record on that basis.60
Note that politics is not always an impermissible factor in
agency decision-making.
The Supreme Court recently ruled that
"[a] court may not reject an agency's stated reasons for acting simply
because the agency might also have had other unstated reasons"
and "may not set aside an agency's policymaking decision solely
because it might have been influenced by political considerations
or prompted by an Administration's priorities."61
Nonetheless, the "impermissible factor" analysis may apply
in situations where, for example, a plaintiff seeks to introduce or
develop evidence that an agency considered factors that Congress
had precluded.
Further, many administrative actions do not involve
making policy and should not be influenced by political considerations.
"Decisions of administrative agencies may . . . be challenged
if unlawful factors, including improper political considerations,
have tainted the agency's exercise of its discretion."62
Discovery to Assess Agency Bad Faith or
Improper Behavior
Discovery is permitted into "the mental processes of administrative
decisionmakers" only when it is supported by a "strong
showing of bad faith or improper behavior" by the agency.63
The Supreme Court recently addressed this issue in the course of deciding
whether a question about citizenship status could be included
in the 2020 census.
The Court concluded that discovery into
the decision-makers' mental processes was justified in that case
because "the sole stated reason" for the Secretary's action had been
"contrived."64 But the Court added that this conclusion could only
be reached after reviewing some 12,000 pages of internal materials
that were produced by the government to supplement the original
administrative record. It noted that the district court "should not
have ordered extra-record discovery when it did. . . . At that time,
the most that was warranted was the order to complete the administrative
record."65
2023] Administrative Procedure Act Litigation 283
Cases permitting discovery of agency decision-makers based
on a showing of bad faith or improper behavior are relatively few and far between.
"What constitutes a strong preliminary showing
of bad faith or improper behavior . . . is a matter that the courts
have been reluctant to define, preferring in the main simply to
declare that on the facts of a given case, the showing has not, or
occasionally has, been made."66
For example, one court found that
a sufficient showing had been made to permit plaintiffs to depose
an agency official where the evidence suggested that the agency's
actions were predetermined and influenced by factors not relevant
to its consideration of the application before it.67
It is difficult to develop evidence that an agency has acted
improperly or in bad faith in a particular matter.
Notably, one district court has opined that "[a] showing that the agency purposefully
excluded from the record documents which were relevant
and adverse to the agency's decision may be sufficient to present a
prima facie case of agency bad faith or improper conduct."68
Thus, a useful starting point for a plaintiff assessing the viability of a
bad faith/improper conduct claim is to examine whether there are
any deliberate omissions in the administrative record and how
significant they are.
63. Id. at 2573-74 (quoting Citizens to Preserve Overton Park, Inc. v.
Volpe, 401 U.S. at 420).
64. Id. at 2575.
65. Id. at 2574.
66. Tummino v. Von Eschenbach, 427 F. Supp. 2d 212, 231 (E.D.N.Y.
2006) (collecting cases).
67. See New York v. Salazar, 701 F. Supp. 2d 224, 243 (N.D.N.Y. 2010).
68. Mulligan v. Huber, No. 7:05CV5005, 2005 WL 8175783, at *10 (D.
Neb. Dec. 9, 2005).
Conclusion
In most Administrative Procedure Act cases, there is no issue
about the completeness of the administrative record.
The basis for the agency's action is fully disclosed in the record that it produces.
And when an administrative record is incomplete, the matter can
sometimes be resolved through discussions between counsel.
Litigation over expanding the administrative record is unusual. But it
can be vital to the outcome of the case.
Notes
* Steven D. Gordon, a partner in the Washington, D.C., office of Holland
& Knight LLP, is a litigator who has been lead counsel in more than 100 trials
and has argued appeals in most of the federal circuits and the U.S. Supreme
Court. He may be contacted at steven.gordon@hklaw.com.
1. Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744 (1985).
2. Camp v. Pitts, 411 U.S. 138, 143 (1973).
284 The Journal of Federal Agency Action [1:275
3. Florida Power & Light Co. v. Lorion, 470 U.S. at 744.
4. In re United States, 138 S. Ct. 371, 372 (2017) (Breyer, J., dissenting
from grant of stay).
5. NVE Inc. v. HHS, 436 F.3d 182, 195 (3rd Cir. 2006).
6. Department of Commerce v. New York, 139 S. Ct. 2551, 2573 (2019).
7. Bazzi v. Gacki, No. 19-cv-484, 2020 WL 5653599, at *6 (D.D.C. Sept.
23, 2020).
8. San Luis & Delta-Mendota Water Authority v. Locke, 776 F.3d 971,
992 (9th Cir. 2014) (internal quotation marks and citations omitted); see also
Esch v. Yeutter, 876 F.2d 976, 991 (D.C. Cir. 1989) (listing exceptions).
9. See IMS, P.C. v. Alvarez, 129 F.3d 618, 624 (D.C. Cir. 1997).
10. Calloway v. Harvey, 590 F. Supp. 2d 29, 38 (D.D.C. 2008) (internal
quotation and citation omitted).
11. 5 U.S.C. § 706.
12. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 420
(1971).
13. Bar MK Ranches v. Yuetter, 994 F.2d 735, 739 (10th Cir. 1993).
14. See GeorgiaCarry.org, Inc. v. U.S. Army Corps of Eng'rs, 212 F. Supp.
3d 1348, 1352 (N.D. Ga. 2016); Amfac Resorts, LLC v. U.S. Dep't of Interior,
143 F. Supp. 2d 7, 12 (D.D.C. 2001).
15. Tafas v. Dudas, 530 F. Supp. 2d 786, 794 (E.D. Va. 2008).
16. See Tafas v. Dudas, 530 F. Supp. 2d at 794; see also Outdoor Amusement
Business Ass'n, Inc. v. Dep't of Homeland Security, No. ELH-16-1015,
2017 WL 3189446, at *8-9 (D. Md. July 27, 2017) (collecting cases).
17. Oceana, Inc. v. Ross, 920 F.3d 855, 865 (D.C. Cir. 2019).
18. See Save the Colorado v. Spellmon, No. 18-cv-03258, 2023 WL
2402923, at *4 (D. Colo. March 7, 2023).
19. Ctr. for Biological Diversity v. U.S. Fish and Wildlife Serv., No. 2:19-
CV-14243, 2020 WL 2732340, at *5 (S.D. Fla. May 26, 2020); accord Save the
Colorado v. Spellmon, 2023 WL 2402923, at *5.
20. New York v. U.S. Immigration and Customs Enforcement, 438 F. Supp.
3d 216, 218 (S.D.N.Y. 2020).
21. Sierra Club v. Zinke, No. 17-CV-07187, 2018 WL 3126401, at *3
(N.D. Cal. June 26, 2018); Lower San Pedro Watershed Alliance v. Barta, No.
CV-19-00048, 2020 WL 8020085, at *3 (D. Az. Nov. 30, 2020).
22. See Yellowstone to Uintas Connection v. Bolling, No. 4:20-cv-00192,
2021 WL 5702158, at *5 & nn. 4 & 5 (D. Idaho. Dec. 1, 2021).
23. See 28 U.S.C. 1391(e).
24. Hill Dermaceuticals, Inc. v. FDA, 709 F.3d 44, 47 (D.C. Cir. 2013)
(per curiam).
25. See Public Power Council v. Johnson, 674 F.2d 791, 793-94 (9th Cir.
1982) (quoting Camp v. Pitts, 411 U.S. 138, 143 (1973)).
26. Id. at 794.
27. San Luis & Delta-Mendota Water Authority v. Locke, 776 F.3d at 993.
2023] Administrative Procedure Act Litigation 285
28. Id.
29. San Francisco BayKeeper v. Whitman, 297 F.3d 877, 886 (9th Cir.
2002).
30. Pit River Tribe v. Bureau of Land Mgmt., No. 2:19-cv-2483, 2022 WL
1778525, at *4 (E.D. Cal. June 1, 2022).
31. Dallas Safari Club v. Bernhardt, 518 F. Supp. 3d 535, 540 (D.D.C.
2021).
32. Id.
33. Telecomms. Rsch. & Action Ctr. v. FCC, 750 F.2d 70, 80 (D.C. Cir.
1984).
34. Florida v. Food and Drug Admin., No: 8:22-cv-1981, 2023 WL
2561380, at *4-5 (M.D. Fla. March 17, 2023).
35. Public Power Council v. Johnson, 674 F.2d at 794; see also Tafas v.
Dudas, 511 F. Supp. 2d 652, 662-63 (E.D. Va. 2007).
36. One example is Arkla Exploration Co. v. Texas Oil Gas Corp., 734
F.2d 347, 357 (8th Cir. 1984), where supplementary evidence was admitted
to provide background information for facts considered, and educate the
court concerning scientific, technical, and economic data used by the agency.
37. See Portland Audubon Soc. v. Endangered Species Comm., 984 F.2d
1534, 1548 (9th Cir. 1993).
38. CTS Corp. v. EPA, 759 F.3d 52, 64 (D.C. Cir. 2014) (citations omitted).
39. Fort Sill Apache Tribe v. NIGC, 345 F. Supp. 3d 1, 10 (D.D.C. 2018).
40. Fund for Animals v. Williams, 249 F. Supp. 2d 49, 55 (D.D.C. 2003)
(citations omitted).
41. Ohio v. U.S. Army Corps of Eng'rs, No. 1:15 CV 679, 2015 WL
7575935, at *2 (N.D. Ohio Nov. 25, 2015).
42. Blue Ocean Inst. v. Gutierrez, 503 F. Supp. 2d 366, 369 (D.D.C. 2007);
accord Stand Up for California! v. U.S. Dep't of Interior, 71 F. Supp. 3d 109,
117 (D.D.C. 2014).
43. See Bar MK Ranches v. Yuetter, 994 F.2d at 739-40.
44. Fund for Animals v. Williams, 391 F. Supp. 2d 191, 198 (D.D.C. 2005)
(internal quotations omitted).
45. Fort Sill Apache Tribe v. NIGC, 345 F. Supp. 3d at 9.
46. Id. (quoting Oceana, Inc. v. Ross, 290 F. Supp. 3d 73, 78-79 (D.D.C.
2018)).
47. Cty. of San Miguel v. Kempthorne, 587 F. Supp. 2d 64, 76 (D.D.C.
2008).
48. Standing Rock Sioux Tribe v. U.S. Army Corps of Eng'rs, No. 16-1534,
2019 WL 2028709, at *3 (D.D.C. May 8, 2019).
49. See Univ. of Colorado Health at Memorial Hosp. v. Burwell, 151
F. Supp. 3d 1, 19 (D.D.C. 2015).
50. See McDonnell Douglas Corp. v. National Aeronautics & Space
Admin., 981 F. Supp. 2d, 14 (D.D.C. 1997), rev'd on other grounds, 180 F.3d
303 (D.C. Cir .1999); Thompson v. U.S. Dept. of Labor, 885 F.2d 551, 555-56
286 The Journal of Federal Agency Action [1:275
(9th Cir. 1989); Sierra Pacific Industries v. U.S. Dept. of Agriculture, No. CIV
S-11-1250, 2011 WL 6749837, at *2 (E.D. Cal. Dec. 22, 2011).
51. See Dopico v. Goldschmidt, 687 F.2d 644, 654 (2d Cir. 1982); Bar MK
Ranches v. Yuetter, 994 F.2d at 740.
52. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. at 419
(quoting 5 U.S.C. § 706).
53. Fort Sill Apache Tribe v. NIGC, 345 F. Supp. 3d at 9.
54. See American Wildlands v. Kempthorne, 530 F.3d 991, 1002 (D.C.
Cir. 2008); Am. Mining Cong. v. Thomas, 772 F.2d 617, 626 (10th Cir. 1985).
55. Asarco, Inc. v. EPA, 616 F.2d 1153, 1160 (9th Cir. 1980).
56. Oceana, Inc. v. Ross, 454 F. Supp. 3d 62, 70 (D.D.C. 2020) (internal
quotation and citation omitted).
57. See id. at 71-73.
58. See id. at 70.
59. Citizens for Alternatives to Radioactive Dumping v. U.S. Dep't of
Energy, 485 F.3d 1091, 1096 (10th Cir. 2007).
60. Skull Valley Band of Goshute Indians v. Cason, No. 07-cv-0526, 2009
WL 10689787, at *7 (D. Utah. March 2, 2009).
61. Department of Commerce v. New York, 139 S. Ct. at 2573.
62. Fallini v. Hodel, 725 F. Supp. 2d 1113, 1118 (D. Nev. 1989) (citing
Town of Orangetown v. Ruckelshaus, 740 F.2d 185, 188 (2d Cir. 1984)).
63. Id. at 2573-74 (quoting Citizens to Preserve Overton Park, Inc. v.
Volpe, 401 U.S. at 420).
64. Id. at 2575.
65. Id. at 2574.
66. Tummino v. Von Eschenbach, 427 F. Supp. 2d 212, 231 (E.D.N.Y.
2006) (collecting cases).
67. See New York v. Salazar, 701 F. Supp. 2d 224, 243 (N.D.N.Y. 2010).
68. Mulligan v. Huber, No. 7:05CV5005, 2005 WL 8175783, at *10 (D.
Neb. Dec. 9, 2005).
https://lawreview.uchicago.edu/print-archive/scope-evidentiary-review-constitutional-challenges-agency-action (https://lawreview.uchicago.edu/print-archive/scope-evidentiary-review-constitutional-challenges-agency-action)
The Scope of Evidentiary Review in Constitutional Challenges to Agency Action
When reviewing agency action, the Administrative Procedure Act (APA) instructs courts to "review the whole record or those parts of it cited by a party."
The Supreme Court has interpreted this brief statement as a restriction on the evidentiary scope of judicial review under the APA.
Courts may consider only the administrative record compiled by the agency, which includes all materials before the decisionmaker at the time he or she made the decision.
The Supreme Court has recognized one exception: plaintiffs may supplement the administrative record if they make a strong showing of bad faith or improper behavior on the part of the agency.
Courts consistently apply the record rule to arbitrary and capricious claims.
It is less clear whether the rule applies to constitutional claims.
This issue crept into two recent, high-profile Supreme Court cases—
Department of Commerce v. New York and
Regents of the University of California v. Department of Homeland Security—
but the Court has yet to definitively resolve the issue.
In the meantime, lower courts have developed three alternative approaches.
This Comment argues that the record rule, though one with a robust bad faith exception, should apply to all constitutional challenges to agency action.
It analyzes the APA's text, legislative history, pre- and post-APA precedent, and policy considerations to argue for a record rule approach.
TABLE OF CONTENTS
Introduction
I. The Record Rule and Judicial Review of Agency Action
A. The APA and Judicial Review of Agency Action
B. The Statutory and Theoretical Bases for the Record Rule
C. Exceptions to the Record Rule
II. The Record Rule and Constitutional Challenges to Agency Action
A. Constitutional Challenges and the APA
B. The Supreme Court's Limited Treatment
C. The Divergent Approaches of the Lower Courts
III. The Legal Case for a Record-Rule Approach
A. APA Text
B. APA Legislative History
C. Pre-APA Precedent
D. Post-APA Precedent
IV. The Public Policy Case for a Record-Rule Approach
Conclusion
When reviewing agency action, the APA instructs courts to "review the whole record or those parts of it cited by a party."15
In Citizens to Preserve Overton Park, Inc. v. Volpe,16 the Supreme Court interpreted this brief statement as a restriction on the evidentiary scope of judicial review under the APA: review is limited to the record compiled by the administrative agency, which properly includes all materials that were before the decisionmaker at the time he or she made the decision.17
As a result, APA plaintiffs typically cannot introduce evidence that was not actually considered by the agency in the decision-making process. This evidentiary limitation is known as the "record rule."18
The Supreme Court has recognized one exception: a plaintiff may introduce evidence that was not before the agency at the time of its decision only if the plaintiff can make a "strong showing of bad faith or improper behavior" on the part of the agency.19
The Court has never addressed exactly what qualifies as a "strong showing of bad faith or improper behavior,"20 but a strong showing that the agency's decision was motivated by factors not discussed in the existing record would likely be enough.21
The record rule covers all lawsuits brought under the APA.22 Section 706 of the APA identifies the primary standards of judicial review for agency action.23
Formal agency action, including rulemaking and adjudication under the APA's formal procedures, is subject to the "unsupported by substantial evidence" standard.24 Informal agency action, including rules enacted through the APA's notice and comment procedure, is frequently reviewed under the "arbitrary, capricious, [ ] abuse of discretion, or otherwise not in accordance with law" standard.25
The arbitrary and capricious standard operates as a catchall standard of review when no other standard is applicable.26
The APA also provides for judicial review of agency action that is "contrary to constitutional right."27 Though the record rule applies to all APA lawsuits, some plaintiffs and courts have questioned whether it applies as strictly to agency action lawsuits brought on constitutional grounds.28
Such constitutional challenges are less common.
But if Department of Commerce and Regents—the equal protection challenges to controversial Trump administration policies noted above—are any indication, they are becoming more so.
The Court's guidance on the record rule has been woefully limited,29 and it has never definitively answered the question of whether the record rule applies to constitutional challenges.30
As constitutional challenges to agency action become more common, this evidentiary question will continue to rear its head.
This uncertainty requires resolution. The outcome of administrative law cases can hinge entirely on the admissibility of extra-record evidence.31
While courts should not reflexively allow extra-record evidence in these cases, this Comment argues that they should embrace a broad reading of the Overton Park bad faith exception to the record rule in constitutional challenges.
The bad faith exception ensures that an insufficient administrative record does not hinder plaintiffs trying to vindicate their constitutional rights.
This Comment will proceed in four Parts.
Part I explores the record rule's general legal background, including its practical application and exceptions.
Part II discusses the record rule's applicability to constitutional challenges to agency action, the Supreme Court's inconclusive discussion of this area of the law, and the divergent approaches of the lower courts.
Part III explains why a record rule approach is preferable for doctrinal reasons.
This discussion focuses on the text and legislative history of the APA as well as the Supreme Court's pre- and post-APA jurisprudence.
Finally, Part IV explains why a record-rule approach is also preferable for public policy reasons.
I. The Record Rule and Judicial Review of Agency Action
This Part explores the legal background of the record rule. Part I.A provides a brief overview of judicial review under the APA.
Part I.B then explains the Supreme Court's textual and theoretical justifications for the record rule. Finally, Part I.C discusses the recognized exceptions to the record rule and their practical application.
A. The APA and Judicial Review of Agency Action
The APA has been called a "superstatute" and even a "subconstitution."36
It acts as the "fundamental charter" for the administrative state,37 delineating basic default rules of agency procedure that are "not lightly to be supplanted or embellished."38
The APA provides that any "person suffering legal wrong because of agency action . . . is entitled to judicial review thereof,"39 unless review is precluded by statute or the questioned action is "committed to agency discretion by law."40
The Supreme Court has interpreted these provisions to enshrine a "basic presumption of judicial review" of agency action.41
The APA provides several specific causes of action against agencies, including if agency action is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; contrary to constitutional right, power, privilege, or immunity; in excess of statutory jurisdiction . . . ; [and] without observance of procedure required by law."42 If an aggrieved party brings suit against an administrative agency under the APA, the statute requires that the reviewing court "decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action."43
Courts are required to "hold unlawful and set aside agency action" found to be in violation of any of the listed standards of review.44
B. The Statutory and Theoretical Bases for the Record Rule
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The APA is clear on the evidentiary scope of judicial review of agency action: "[T]he court shall review the whole record or those parts of it cited by a party."45
This simple sentence suggests both a maximum ("the whole record") and a minimum ("those parts of it cited by a party") evidentiary standard for courts reviewing "agency action, findings, and conclusions."46
Overton Park.48
There, the Supreme Court considered a challenge, brought by Memphis residents, against the Secretary of Transportation's decision to build a highway through a popular park.49
The Court affirmed that judicial review of this decision should generally be limited to the "full administrative record that was before the Secretary at the time he made his decision."50
Two years later, in Camp v. Pitts,51 the Court reaffirmed the record rule, stating that "the focal point for judicial review should be the administrative record already in existence, not some new record made initially in the reviewing court."52
Courts generally agree that the administrative record includes not just those materials considered directly by the agency decisionmaker but all materials considered by the agency as a whole in its decision-making process.53
The theoretical basis for the record rule is the fundamental notion that executive branch actions enjoy a "presumption of regularity" when reviewed by Article III courts.54 In other words, courts presume—absent a showing to the contrary—that agency officials have acted in good faith and have not misrepresented the facts.55
The Supreme Court first explicitly articulated the presumption of regularity in 192656 and has reiterated it many times since,57 though often without much explanation.58
The presumption of regularity reflects separation of powers concerns: courts should not frustrate congressional directives or executive discretion by "prob[ing] the mental processes" of agency decisionmakers.59
The presumption also reflects institutional competence concerns: administrative agencies operate in highly specialized spheres of expertise, and their decisions may rest on technical reasoning or analysis.60 In the administrative-record context, we may question the ability of a generalist judge to second-guess whether a record submitted by an agency sufficiently explains a specialized decision.
C. Exceptions to the Record Rule
The record rule is not without exceptions.
After all, the presumption of regularity is a rebuttable presumption.61 In the administrative-record context, APA plaintiffs can attempt to rebut the presumption by bringing either a "motion to complete" the record or a "motion to supplement" the record.62 This area of law has been the subject of extraordinary confusion among lower courts, primarily due to inconsistent terminology.63
Some judges have recently added clarity by explaining the distinction between completion and supplementation.64
When a plaintiff argues for completion, he is arguing that there are materials that should have been properly included in the administrative record but were excluded by the agency.65
In other words, the materials in question were actually considered by the agency during the decision-making process but were either unintentionally or intentionally left out of the record submitted to the court.
Given the presumption of regularity, courts generally require plaintiffs to show "clear evidence" that the materials in question were actually considered by the agency and, thus, should have been included.66
Even scholars who are otherwise skeptical of broad exceptions to the record rule are generally supportive of a plaintiff's ability to complete the record if the plaintiff can demonstrate that the agency actually considered other materials in the first place.67
When a plaintiff argues for supplementation, he is arguing that there are materials outside the proper scope of the administrative record—materials that the agency itself did not consider in making its decision—that courts should nonetheless consider when reviewing the agency action.69
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This category of extra-record evidence includes materials that were not before the agency during the decision-making process as well as internal materials that are only tangentially related to the questioned decision.70
This could include public statements by a government official,71 related emails exchanged by government officials,72 documents considered by the agency in similar decisions,73 or documents produced after the agency made the questioned decision.74
Sometimes, plaintiffs simply ask for "discovery in general."75
Plaintiffs seeking record supplementation are generally trying to show that an agency's stated explanation for its decision was not the true motivating factor or that politics or animus improperly influenced the decision-making process.
Extra-record evidence can be used to bolster an arbitrary and capricious claim since it can indicate that the agency committed a "clear error of judgment," "relied on factors which Congress has not intended it to consider," or "failed to consider an important aspect of the problem."76
Scholars continue to debate the virtue of motions to supplement the record as well as the virtues of the record rule more broadly.77
When deciding whether a plaintiff may supplement the record, lower courts generally apply the "strong showing of bad faith or improper behavior" standard first articulated by the Supreme Court in
Overton Park.78
In this 1971 decision, the Court reversed and remanded an APA case after a lower court based its decision on affidavits presented by the Secretary after litigation had already begun.79
These affidavits, the Court held, were "merely 'post hoc' rationalizations" and thus "an inadequate basis for review."80
The Court remanded for the district court to decide the case on the full administrative record.81
It left open the possibility of requiring agency officials to give testimony explaining their decision but cautioned that such "inquiry into the mental processes of administrative decisionmakers is usually to be avoided."82
Only after a "strong showing of bad faith or improper behavior" may such an inquiry be made.83
Some scholars have criticized the Overton Park "bad faith" language as having no basis in the text of the APA and as confusing in application.84
Indeed, the Court has never fully explained what is required to make a strong showing of bad faith or improper behavior.85
In his partial concurrence in Department of Commerce, Justice Clarence Thomas, joined by Justices Neil Gorsuch and Brett Kavanaugh, questioned the "legitimacy and scope" of the Overton Park exception and noted that it "may warrant future consideration."86
Moreover, lower courts rarely find the Overton Park exception satisfied.87
Nonetheless, a majority of the Court in Department of Commerce affirmed the Overton Park standard as a "narrow exception" to the rule against supplementing the record.88
Thus, the Overton Park exception still stands, despite the criticism.
Sokaogon Chippewa Community v. Babbitt,89 a Western District of Wisconsin decision, involves a rare example of a court holding that plaintiffs satisfied the Overton Park bad faith exception.
The case involved a group of Chippewa Indians who submitted applications to the Department of the Interior to convert a greyhound racing facility into a casino.90
The Department denied their application, citing opposition from the surrounding communities.91 Plaintiffs moved to supplement the administrative record, arguing there was "improper political influence" on the Department's decision.92
To substantiate this claim of bad faith, and push it over the "strong showing" line required by Overton Park, plaintiffs cited several suspicious communications between opposition tribes, legislators, lobbyists, and the Secretary of the Interior's staff, as well as procedural irregularities in the Department's actions.93
Ultimately, the court granted plaintiffs' motion to supplement the record, finding that the plaintiffs raised a "substantial suspicion" of bad faith or improper behavior.94
This case indicates that, in order to make a strong showing of bad faith, plaintiffs may be required to offer the court a preview of the evidence with which they hope to supplement the record.
If the Chippewa court had denied the plaintiffs' motion to supplement, their citations to the suspicious communications would not have been included in the record and, thus, would not have been considered by the court on the merits.
Though it has explicitly endorsed only the Overton Park exception, the Supreme Court has also implied that supplementation is appropriate where an agency gives such an inadequate explanation of administrative action that it frustrates judicial review.95
The exception can be traced back to Camp v. Pitts, where the Court vacated a circuit court's order for a trial de novo after a Comptroller offered an inadequate explanation for his denial of a bank charter.96
The Court explained that if "there was such failure to explain administrative action as to frustrate effective judicial review," the lower court should "obtain from the agency . . . such additional explanation of the reasons for the agency decision as may prove necessary."97
The Court may have been referring to record completion, but some lower courts have interpreted this language in the context of record supplementation.98
The Court did not mention the "failure to explain" exception in Department of Commerce, and some scholars have criticized it as "contrary to the APA."99
Moreover, an agency actively seeking to frustrate judicial review would necessarily be exhibiting bad faith as well.
But the Court has never explicitly foreclosed a "failure to explain" exception to the record rule.
While the Overton Park bad faith exception stands as the general rule for extra-record evidence, the circuits have applied the exception in varying and sometimes contradictory ways.100
The D.C. Circuit, for example, has recognized three "unusual circumstances" that will justify record supplementation:
(1) the agency deliberately or negligently excluded documents that may have been adverse to its decision;
(2) the district court needed to supplement the record with background information in order to determine whether the agency considered all of the relevant factors; or
(3) the agency failed to explain administrative action so as to frustrate judicial review.101
The Ninth Circuit, on the other hand, has recognized four exceptions that overlap with the D.C. Circuit's three exceptions in varying ways.
First, extra-record evidence is permissible if it is "necessary to determine whether the agency has considered all relevant factors and has explained its decision."102
This overlaps with the D.C. Circuit's second and third exceptions.
Second, extra-record evidence is permissible if the agency "relied on documents not in the record."103
This is properly understood as completion of the record, not supplementation, yet another indication of the confusion that has garbled this area of law.
Third, extra-record evidence is permissible if it is "necessary to explain technical terms or complex subject matter,"104 an exception unique to the Ninth Circuit and with little basis in the Overton Park bad faith standard. Finally, extra-record evidence is permissible if the "plaintiffs make a showing of agency bad faith,"105 a clear homage to Overton Park.
Despite these varying approaches from the circuits, the Supreme Court's most recent statement is fairly clear: extra-record evidence is allowed only with a strong showing of bad faith or improper behavior.106
II. The Record Rule and Constitutional Challenges to Agency Action
This Part introduces the legal question at the heart of this Comment: whether the record rule applies to constitutional challenges to administrative agency action.
Part II.A discusses how constitutional claims differ from arbitrary and capricious claims and introduces the evidentiary question raised by constitutional claims.
Part II.B traces the Supreme Court's limited treatment of the question, concluding that the Court has never offered a clear answer.
Finally, Part II.C discusses the divergent approaches of the lower courts, dividing them into three buckets.