Government regulation has a profound impact on companies’ business operations and is a crucial factor in corporate strategic planning. Regulatory and enforcement actions by the EPA, FTC, OSHA, SEC, FCC, FDIC, PCAOB and now the CFPB, as well as countless other federal and state agencies, can impose significant costs, foreclose promising business opportunities, and at times can threaten the vitality of a company or even an entire industry.
A thorough understanding of the legal principles governing agency conduct is critical to a successful challenge to an adverse agency action or the successful advocacy for—or defense of—a favorable agency decision. The legal constraints on government action do not depend solely on the particular agency at issue, but also on general principles of administrative law, such as what constitutes “arbitrary and capricious” agency action; when notice and comment rulemaking is required and what an agency must do to satisfy it; and the application of “Chevron” deference.
The lawyers in Gibson Dunn’s Administrative Law and Regulatory Practice Group have an exceptional capacity to represent clients seeking to challenge or defend government regulation or to bring about appropriate regulatory action. The group comprises lawyers from an array of practice groups in the firm, including Environmental Litigation and Mass Tort, Labor and Employment, Securities Litigation and Regulation, Financial Institutions, Government and Commercial Contracts, Antitrust and Trade Regulation, and International Trade Regulation and Compliance. The group includes a number of lawyers with high-level government experience, including former general counsel to the EPA, Department of Labor (Solicitor of Labor), and Department of Justice (Assistant Attorney General, Office of Legal Counsel); and lawyers who held top legal, policy and enforcement positions at the FTC, SEC, OSHA and other agencies. Lawyers in the Administrative Law Group work closely with the firm’s Appellate and Constitutional Law Practice Group, which is widely recognized to be among the very best in the country. When an agency’s actions warrant Congressional scrutiny, the firm’s Public Policy Practice Group provides sophisticated expert assistance.
In addition to representing clients in rulemakings, judicial review of agency action and enforcement actions, as described above, Gibson Dunn lawyers handle a variety of other agency-related matters on a daily basis, including FOIA and reverse-FOIA representations, variances, exemptions, approvals, and opinions in connection with existing regulations. In these and countless other regulatory matters, the firm’s familiarity with administrative agencies and the reputation of its Litigation Department are often decisive.
Companies and trade associations often do not retain counsel until a rulemaking is complete and litigation over the final rule has begun. This deferred involvement of counsel can sometimes prove to be a serious mistake. In controversial rulemakings, experienced counsel serve virtually the same function as they would at trial: marshaling evidence and arguments to persuade the agency of the client’s position and, failing that, establishing the best possible record for judicial review of the final rule. Evidence not presented in a rulemaking ordinarily cannot be used to challenge or defend the rule in court; accordingly, it often is critical to develop a rulemaking strategy with the assistance of counsel and an eye toward eventual litigation. Gibson Dunn has participated in countless rulemakings before federal and state agencies, including:
- OSHA “ergonomics” regulation. Gibson Dunn played a principal role in opposing the OSHA “ergonomics” rule that was invalidated by Congress in the first-ever use of the Congressional Review Act. On behalf of the National Association of Manufacturers, National Coalition on Ergonomics, and more than a hundred other trade associations and corporations, the firm filed thousands of pages of material in the “repetitive motion injury” rulemaking and examined scores of witnesses during months of public hearings. Once the rule was finalized, the firm led the industry’s court challenge to the rule and assisted with legislative strategy, including testifying before Congress on use of the Congressional Review Act.
- “Auditor independence” rulemaking. Gibson Dunn represented several leading accounting firms in connection with a major SEC rulemaking that threatened to dramatically restrict the services that accounting firms can provide to clients they audit. Implementing a multi-pronged approach that involved participation in the notice-and-comment process, positioning for potential litigation over the rule and aggressive pursuit of a legislative and public-relations strategy, Gibson Dunn was able to persuade the SEC to narrow its proposal significantly, to the point that the client group was able to endorse the rulemaking.
- SEC Rulemakings. Gibson Dunn has represented clients in numerous other significant rulemakings before the SEC, including the “proxy access” rulemaking, and is currently representing clients in numerous rulemakings arising out of Dodd-Frank.
- Greenhouse Gas Emission Regulation. Gibson Dunn has represented the GlobalAutomakers (formerly the Association of International Automakers) in a variety of rulemakings, including filing comments to EPA in opposition to the State of California’s request for a preemption waiver under Section 209(b) of the Clean Air Act for its motor vehicle greenhouse gas regulations. Gibson Dunn subsequently represented the GlobalAutomakers in multiple challenges to state regulations limiting greenhouse gas emissions from motor vehicles. Litigation involved appeals to the Second and Ninth Circuits, as well as the federal District Courts in California, Rhode Island and Vermont.
Judicial Review of Agency Action
Some of our significant administrative law representations include:
- Business Roundtable & U.S. Chamber of Commerce v. SEC, 647 F.3d 1144 (D.C. Cir. 2011). Represented two leading U.S. business associations in successful challenge to controversial SEC rule regarding “proxy access.”
- Ass’n of Private Sector Colleges & Universities v. Duncan, 681 F.3d 427 (D.C. Cir. 2012). Successfully challenged a number of regulations adopted by the Department of Education.
- American Equity Investment Life Insurance Co. v. SEC, 613 F.3d 166 (D.C. Cir. 2010). Prevailed in a challenge to an SEC rule regulating the $100 billion Fixed Indexed Annuities industry.
- Goodrich Corporation v. EPA, 593 F.Supp.2d 184 (D.D.C. 2009). Succeeded in obtaining an order directing EPA to disclose soil and groundwater models that had been withheld under various FOIA exemptions. The decision represents an important precedent defining when the United States waives its protection under FOIA Exemption 5 and the scope of Exemption 7(A)’s law enforcement provision.
- Comcast Corp. v. FCC, 579 F.3d 1 (D.C. Cir. 2009). Successfully represented Comcast in a landmark case where the D.C. Circuit abolished FCC limits on cable market share. In 2001, the D.C. Circuit threw out on First Amendment grounds an FCC rule that barred cable operators from controlling more than 30 percent of the nationwide market, but, in 2007, the FCC reestablished the 30 percent rule. Comcast argued that the FCC’s calculations were based on pre-2001 data that ignored satellite television’s increasing market share, and the court agreed.
- U.S. Chamber of Commerce v. SEC, 412 F.3d 133 (D.C. Cir. 2005), and U.S. Chamber of Commerce v. SEC, 443 F.3d 890 (D.C. Cir. 2006). Brought two successful challenges to the SEC’s controversial mutual fund “governance” rule. Two provisions were initially invalidated by the court in 2005 and remanded to the Commission for further consideration. Then, in a highly publicized, hasty eight-day rulemaking, the Commission re-adopted the provisions unchanged. In response to the Commission’s action, Gibson Dunn filed an emergency motion seeking a stay of the re-adopted rules. The court took the unusual step of granting the stay, and, on the merits, accepted Gibson Dunn’s argument that the SEC had violated the Administrative Procedure Act by relying extensively on evidence outside the administrative record without providing for public comment.
- Trout Unlimited v. U.S. Dep’t of Agric., 320 F.Supp.2d 1090 (D. Colo. 2004). Successfully challenged the issuance of a special use permit by the Forest Service that permitted water purveyors to operate a dam at the Long Draw Reservoir that violated the Federal Land Policy Management Act and the National Environmental Policy Act, and successfully defended the decision on appeal, Trout Unlimited v. U.S. Dep’t of Agric., 441 F.3d 1214 (10th Cir. 2006).
- National Wildlife Foundation v. EPA, 237 F.3d 670 (D.C. Cir. 2001). Acted as lead counsel in the Cluster Rule Litigation on behalf of International Paper Company, The Mead Corporation, Westvaco Corporation and Boise Cascade Corporation in the Ninth Circuit and the D.C. Circuit. We were successful in transferring the case from the Ninth Circuit to the D.C. Circuit over the objections of the environmental petitioners and were successful in protecting the confidential business information submitted by the industry during development of the Cluster Rules.
- United States Telecom Association v. FCC, 227 F.3d 450 (D.C. Cir. 2000). Successfully challenged an FCC regulation regarding telecommunications surveillance by law enforcement authorities. The D.C. Circuit held that the FCC violated constitutional and statutory limitations.
- U.S. Chamber of Commerce v. U.S. Department of Labor, 174 F.3d 206 (D.C. Cir. 1999). Successfully challenged the “Cooperative Compliance Program,” one of largest enforcement programs in OSHA’s history.
- Represented the Coalition for Truth in Science in Endangered Species Act Litigation. The Center for Biological Diversity sued the Fish and Wildlife Service of the United States Department of Interior to force the listing of the California Tiger Salamander under the federal Endangered Species Act. Gibson Dunn intervened in this litigation on behalf of a coalition of interests that oppose the listing of this species in the absence of sound science indicating that a listing is required.
Gibson Dunn regularly represents clients in formal and informal enforcement actions before administrative law judges, commissions and in federal and state court. The firm has extensive experience with enforcement actions by the EPA, SEC, FDIC, FTC, OSHA, and the Customs Service and the Commerce Department’s Bureau of Export Control; with debarment proceedings by the Department of Defense and other agencies; and with proceedings involving numerous other federal and state agencies.