Can an Agency Ignore Circuit Court Precedence in a Rulemaking?

In the era of the Administrative State, it might seem that federal agencies have the power to create, expand, or amend any laws that they’d like. This, however, ignores the foundational principles of the separation of powers inherent in the United States Constitution and the authority that created these agencies, which was intended to be quite limited. This issue came to a head recently in the Northern District of Alabama when the Court requested briefing on the Department of Education’s attempt to redefine the scope of Title IX, contrary to a prior decision by the Eleventh Circuit Court of Appeals. This is particularly noteworthy as the Department of Education in 2023, still under the Biden Administration, was rebuked for attempting to implement a student debt relief plan that would have cost billions of dollars despite court precedence determining that such major questions are to be decided by Congress. Thanks to the guidance of the Supreme Court, and adherence to the separation of powers and rule of law by circuit courts of appeal, federal agencies’ attempts to aggrandize power has been halted, for now.  

Administrative agencies are creatures of statute. They, accordingly, possess only the authority that Congress, the Legislative Branch, has provided to them. Therefore, any authority or power possessed by an agency can only be derived from a power of the Congress. While Congress does possess a number of powers under the Constitution, all judicial power has been specifically delegated to the Judicial Branch. The Supreme Court announced as much in Marbury v. Madison when it determined it is “emphatically the province and duty of the judicial department to say what the law is.” This comports with the civics lessons many Americans are taught, even in government schools: The Legislature wields the power to prescribe general rules for the government of society, but the interpretation and application of those rules to individuals in society is the sole duty of the Judiciary.  

 Courts have created two terms for dealing with situations where an administrative agency attempts to buck this separation of powers and create a rule that violates a judicial opinion from a circuit court of appeal: “intracircuit nonacquiescence” (refusing to follow a circuit court within the jurisdiction in which the agency applies its rule), and “intercircuit nonacquiescence” (the refusal of an agency to follow circuit court decisions in other circuits).  

In cases of intracircuit nonacquiescence, courts have uniformly condemned agencies attempts to usurp the judicial power. Therefore, when a federal circuit court makes a precedential determination of law relating to matters on which the agency issues a new rule in that circuit, the agency has no power to issue rules contrary to the court’s ruling.  

 Cases of intercircuit nonacquiescence have not fared much better. As an initial matter, these cases involve agency action that is either limited to certain circuits or are nationwide actions that much be limited due to an issue of intracircuit nonacquiescence in at least one circuit. The lack of uniformity likely gives courts pause in considering such actions. In addition, courts have generally found that such nonacquiescence is only acceptable when an agency advances a contrary rule in different circuits with the goal of seeking certiorari from the Supreme Court to eventually settle the law nationwide and the agency must clearly assert its nonacquiescence, specifying its arguments against adverse precedent to preserve them for Supreme Court review. This is justifiable as it allows an avenue for agencies to seek a proper change in the law, but it is narrowly confined to prevent agencies from attempting to usurp the judicial power.  

 Therefore, under either intracircuit nonacquiescence or intercircuit nonacquiescence it is clear that an agency cannot ignore a preexisting circuit court opinion. Rather, the agency must address the opinion and specify why it is not following such an opinion, even if it is from a circuit where the rule would not be effective. This rule promotes respect for the Judicial Branch and the separation of powers that delineated that the Legislature may create the law, but the Judicial Branch interprets the application of the law and states what the law is.  

 Famously, Ben Franklin was once asked what form of Government the United States had: “A republic, if you can keep it,” he responded. Questions like this, and the answers provided by the courts, which define the boundaries of the separation of powers between the branches of government and limit unelected bureaucrats’ ability to regulate the lives of Americans, are central to retaining our republican form of government.