Revisiting the Impact of Judicial Review on Agency Rulemakings: An Empirical Investigation

Abstract

ABSTRACT It is generally believed that the judicial review of agency rulemakings helps protect the public against industry capture. Yet very little empirical research has been done to assess the accuracy of this conventional wisdom. This Study examines the entire set of air toxic emission regulations promulgated by the Environmental Protection Agency (EPA), with particular attention to those rules appealed to judgment in the court of appeals, and discovers significant disconnects between popular understanding of judicial review and rulemaking reality. Of these air toxic rules (N=90), the courts were summoned to review only a small fraction (8%), despite evidence that many air toxic rules may have problems, at least from the public perspective. Moreover, although virtually all of the litigation brought by public groups against the EPA's air toxic rules was successful, the resulting victories have not yet had much impact in practice. For most of its vacated regulations, the EPA has either ignored or limited the courts' opinions and has not repromulgated revised rules. Thus, while the tenor of the opinions seems to reaffirm the courts' role as guardian of the public the actual impact of these opinions on agency practice may be less influential than one might expect. A concluding section takes the analysis one step further and explores the possibility that the net effect of judicial review may actually be more perverse. The ability of the dominant parties (which in the case of the EPA's air toxic rules are regulated industries) to threaten the agency with expensive and time-consuming litigation could provide these groups with legal leverage that, in the aggregate, serves to further undermine the agency's ability to act on behalf of the public interest. TABLE OF CONTENTS INTRODUCTION I. JUDICIAL REVIEW OF AGENCY RULEMAKINGS: THEORY AND PRACTICE A. Basics of Judicial Review B. Unreviewed Assumptions II. THE STUDY III. FINDINGS A. The Role of the Courts in Advancing the Public Interest 1. The Court Opinions 2. The Denominator Factor: Comparing the Appeals Against the Larger Set of Air Toxic Emission Standards 3. Summary B. What Is the Impact of the Courts' Rulings on the EPA's Rulemaking Project? 1. Repairing Deficient Rules 2. Precedential Effects C. Some of the Unintended Costs to the Public Interest from Judicial Review IV. REVISITING THE IMPACT OF JUDICIAL REVIEW ON AGENCY RULEMAKINGS A. Interest Group Representation Model B. The Traditional Model, Revisited C. The Limits of the Courts CONCLUSION APPENDIX INTRODUCTION The judicial expansion of standing in the 1970s radically altered administrative process. A legal system available only to regulated industries seeking to protect their narrow interests against agency abuse (1) was transformed into a process that allowed all affected parties, including public groups, to challenge agency rules in court. (2) The risk that the agency could now be sued by all affected parties, rather than just by regulated interests, was expected to cause agencies to be both more solicitous of and more receptive to the views of all stakeholders. (3) Equally beneficial, when an agency did ignore stakeholder input, the agency could be forced to explain its decision to the courts. (4) This new, broader form of judicial review was expected to play a particularly important institutional check against capture by regulated parties. (5) Although there is vigorous debate about whether this pluralistic model--initially dubbed the interest group representation model--is the best one for administrative process, (6) there seems to be tacit agreement among commentators that this model generally describes what occurs on the ground. (7) Yet central features of the pluralistic model remain unsubstantiated as an empirical matter. …