Can Agencies Lie? A Realist’s Guide to Pretext Review
Jack Thorlin
Can federal agencies lie about why they issue a rule—and should they be able to? In the recent case of Department of Commerce v. New York, Chief Justice John Roberts’s opinion for the Court upheld a district court ruling that the Department of Commerce’s use of a pretextual explanation for its proposed addition of a citizenship question to the 2020 Census violated the Administrative Procedure Act (“APA”). The four liberal-leaning Justices joined the Chief Justice’s decision on pretext, but they also would have found the rulemaking arbitrary and capricious on other grounds. The four conservative-leaning Justices dissented regarding pretext, stopping just short of saying that pretextual explanations are acceptable under the APA.
The state of jurisprudence on pretext is now uncertain. Department of Commerce left several questions unanswered, including precisely how courts are to determine whether an explanation is pretextual, how agencies might “fix” a rule remanded back to them on grounds of pretext, and whether the case’s unique factual circumstances render the doctrine largely inapplicable to other contexts. The new doctrine presents an unpalatable choice for courts: require seemingly utopian candor from federal agencies tasked with implementing democratically-endorsed agendas, or permit evident falsehoods on the part of political agency heads. From a policy perspective, there are compelling arguments on both sides of the proposition. Allowing agencies to use pretextual explanations increases democratic control over the regulatory process by permitting increased political influence over the supposedly technocratic agencies. However, prohibiting pretextual explanations could improve both the substance and transparency of rulemaking.
This Article argues that pretext doctrine should be understood as a reaction to the abuse of expertise, as originally technocratic agencies have been increasingly employed to achieve properly legislative political ends. The legal process should proceed as follows: When plaintiffs make an initial showing that the agency may have acted in bad faith, a reviewing court should authorize additional discovery, and overturn the agency action if the agency issued a pretextual explanation. The agency then automatically loses the presumption of regularity and the court should impose a higher standard of review if the agency tries to reissue a substantively identical rule. Evidence of pretext can and should rebut the ordinary deference courts show toward agencies. While care should be taken to craft a realistic pretext doctrine, the complexities of pretext review should not dissuade courts from trying to improve agency honesty.