The Court recently granted cert. in Christopher v. SmithKline Beecham Corp., a case which may lead the Court to revisit whether an agency’s interpretation of its own regulations merit deference. [Disclosure: Goldstein & Russell, whose attorneys contribute to this blog, represents the petitioners in this case, but the author of this post is not involved in the case.]
At issue in Christopher is whether pharmaceutical sales representatives fall within the Fair Labor Standards Act’s exemption from overtime pay. In trying to answer that question, the lower courts have split on whether to give deference to the Department of Labor’s view that pharmaceutical sales reprentatives do not qualify for the FLSA exemption, and thus must be paid overtime. According to respondent SmithKline Beecham, the Department’s position, taken in amicus briefs filed in these cases, is an about-face by the agency and merits no deference — a conclusion with which the Ninth Circuit agreed. But the Second Circuit relied on the agency’s amicus brief to guide its decision, citing the Supreme Court’s decision in Auer v. Robbins requiring courts to defer to agency interpretations of their own rules.
The case raises at least two interesting questions regarding the interplay between courts and agencies. First, the court may use this case to address whether an agency’s change in position merits deference. In a recent article, Professors Randy J. Kozel and Jeffrey A. Pojanowski point out that the Justices appear conflicted over whether agencies should be given deference for novel interpretations of the law. Kozel and Pojanowski suggest that courts should defer to some types of changes, but not others. For example, they contend that deference is due to changes in agency interpretations based on new evidence, the agency’s technical expertise, or new legal precedent, but they argue that courts should decline to defer when the change in position is grounded upon the agency’s new perspective on static information, such as congressional intent or the import of existing precedent.
Also lurking in this case is the threshold question of whether agencies should ever get deference for interpretation of their own regulations, whether consistent or not. The Supreme Court has granted such deference ever since its 1945 decision in Bowles v. Seminole Rock, and it reaffirmed that position more recently in Auer v. Robbins. But there are some interesting arguments against doing so. In a 1996 article in the Columbia Law Review, Professor John Manning made a strong separation of powers argument against such deference. Manning asserted that a single entity should not be given the dual power to both make and interpret law because doing so might encourage agencies to issue vague rules that they can then interpret as they wish in subsequent cases, frustrating notice and predictability and undermining the rule of law.
In his concurrence last term in Talk America v. Michigan Bell Telephone Co., Justice Scalia discussed Manning’s article and wrote that he would be “receptive” to reconsidering the rule of deference in Auer. This may be just the case he was looking for.
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