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Published in Print: June 8, 2016, as Restroom Guidance A Thorny Case Study In Regulatory Law

Restroom Guidance a Thorny Study in Administrative Law

Scott Pruitt, Oklahoma’s attorney general, asserts that the Obama administration failed to follow proper legal procedures in issuing guidance on transgender students.
Scott Pruitt, Oklahoma’s attorney general, asserts that the Obama administration failed to follow proper legal procedures in issuing guidance on transgender students.
—Sue Ogrocki/AP-File
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Two radically different narratives are emerging about the federal guidance over transgender students and restrooms.

President Barack Obama's administration asserts that its guidance calling for schools to allow transgender students to choose restrooms and locker rooms "consistent with their gender identity" is an interpretation of long-standing regulations under Title IX of the Education Amendments of 1972, the federal law barring discrimination "based on sex" in federally funded education programs.

"This guidance does not add requirements to applicable law, but provides information and examples to inform recipients about how the Departments [of Justice and Education] evaluate whether covered entities are complying with their legal obligations," those departments said in a May 13 "Dear Colleague" letter.

Meanwhile, about a dozen states, several school districts, and two parents' groups have filed lawsuits painting the guidance in different terms.

"The new rules, regulations, guidance, and interpretations described herein are 'rules' under" the federal Administrative Procedure Act, or APA, says the suit against the Obama administration filed last month by Texas and 10 other states or their officials. Such broad new "rules" must at the very least go through notice-and-comment procedures under the APA, the suit says.

But the suit quickly adds that the transgender guidance goes "so far beyond any reasonable reading of the relevant Congressional text such that the new rules, regulations, guidance, and interpretations functionally exercise lawmaking power reserved only to Congress."

'Byzantine Rulemaking'

A separate suit filed by parents in Palatine, Ill., against the U.S. Education Department and the local school district alleges that the informal guidance suffers from numerous procedural defects, and it is, in reality, a "new legislative rule."

"A legislative rule has the force of law, and can be a drastic departure from what the law said," argued J. Matthew Sharp, a Lawrenceville, Ga., lawyer for the Alliance Defending Freedom, the group that brought the Illinois suit, in an interview. "Those are the ones that have to go through the process of notice-and-comment rulemaking."

Of course, much more is at stake in the transgender guidance battle than the niceties of administrative law.

"Schools have a responsibility to provide a safe and nondiscriminatory environment for all students, including transgender students," says the May 13 "Dear Colleague" letter from the Education and Justice departments. "A school may not require transgender students to use [restroom and locker room] facilities inconsistent with their gender identity or to use individual-user facilities when other students are not required to do so."

Scott Pruitt, the Republican attorney general of Oklahoma, explained in an opinion essay in The Wall Street Journal last week why his state joined with Texas and the other states (Alabama, Arizona, Georgia, Louisiana, Maine, Utah, West Virginia, and Wisconsin) in suing the administration.

"In addition to unilaterally and unconstitutionally rewriting a statute enacted by Congress, the Obama administration failed to follow even the basic legal procedures for altering agency rules—procedures that are meant to inject into the Byzantine rulemaking process some democratic participation," Pruitt wrote.

"None of what the Education Department has mandated is in Title IX," he added, "and no one can seriously argue that this is what Congress had in mind when it wrote the law or when President [Richard] Nixon signed it."

'New Contexts'

The transgender issue is casting light on the "Byzantine rulemaking" process Pruitt referred to.

Amy Wildermuth, a law professor at the University of Utah and an authority on administrative law, noted that as Congress has become gridlocked on many issues, federal agencies have asserted their administrative authority.

"Agencies filling the gaps are looking to the tools they have available to them," she said.

Richard J. Pierce Jr., a law professor at George Washington University and another expert on administrative law, said the key issues in the transgender lawsuits are whether the guidance from the Education Department is a "substantive," or legislative, rule, on the one hand, or a less formal "interpretative" rule.

Legislative rules are usually authorized by the act of Congress itself, and typically fill in many gaps in a statute. The Education Department's recent proposed regulations for the Every Student Succeeds Act would be an example of such a rule, which under the APA must go through a notice-and-comment procedure and meet other requirements.

The transgender guidance is an example, at least in the administration's view, of an interpretative rule. The Education Department is interpreting is own regulations under Title IX, in this instance a 1975 regulation making clear that schools could keep separate bathrooms for girls and boys.

Dorie Nolt, a spokeswoman for the Education Department, said officials would not be available to expand on the May 13 Dear Colleague letter, but in an email, she emphasized that "in policy guidance, complaint resolutions, and briefs filed in recent years," the Justice Department and the Education Department's office for civil rights has consistently interpreted Title IX "as protecting all students, including LGBT students, from discrimination based on sex, including discrimination and harassment based on gender identity and sex stereotypes."

The Justice Department put it another way in a brief filed in a Virginia case, G.G. v. Gloucester County Schools, in which a transgender student who identifies as a boy sought to be able to use the boys' restroom at his high school.

The department, in siding with the boy who has been publicly identified as Gavin Grimm, said that "for most of its existence, there was no dispute about [the 1975 Title IX regulation's] meaning; it was understood simply to mean what it says, i.e., that Title IX recipients can provide separate boys' and girls' facilities."

"It is only in recent years, as schools have confronted the reality that some students' gender identities do not align with their birth-assigned sex, that schools have begun citing [the regulation] as justification for enacting new policies restricting transgender students to facilities based on their 'birth' or 'biological' sex," the department continued. "It is to those newfound policies that ED's interpretation of the regulation responds."

"Providing guidance on how its regulations apply in new contexts is precisely the role of a federal agency," the brief said.

French Philosophy 101

The U.S. Court of Appeals for the 4th Circuit, in Richmond, Va., sided with the transgender student and the Obama administration in its April 19 decision, saying the Education Department's guidance on the issue was owed deference under principles of administrative law.

The court applied what is known in administrative law as "Auer deference," based on a 1997 U.S. Supreme Court known as Auer v. Robbins.

"Auer requires that an agency's interpretation of its own ambiguous regulation be given controlling weight unless the interpretation is plainly erroneous or inconsistent with the regulation or statute," U.S. Circuit Judge Henry F. Floyd wrote for the 4th Circuit court panel in the Gloucester County case. "Agency interpretations need not be well-settled or long-standing to be entitled to deference. They must, however, reflect the agency's fair and considered judgment on the matter in question."

The Education Department's interpretation, which at that point consisted of various policy pronouncements that preceded the May 13 "Dear Colleague" letter, met the standard for Auer deference, the majority concluded.

"Auer deference is pretty deferential" to federal agencies, said Wildermuth of the University of Utah law school.

The 1997 Auer decision was written by the late Justice Antonin Scalia, in a case about the U.S. Department of Labor's interpretation of its overtime-pay regulations. Scalia would go on to have second thoughts about the principle of the case.

"For decades, and for no good reason, we have been giving agencies the authority to say what their rules mean, under the harmless-sounding banner of deferring to an agency's interpretation of its own regulations," Scalia wrote in a concurrence in a 2013 case about environmental regulations.

The justice, who died this past February, was generally concerned about the growth of the administrative state, and he expressed fears that according federal agencies the power to interpret their own regulations would harm the constitutional separation of powers. He quoted the 18th Century French political philosopher Montesquieu: "When the legislative and executive powers are united in the same person . . . there can be no liberty; because apprehensions may arise, lest the same monarch or senate should enact tyrannical laws, to execute them in a tyrannical manner."

'Not a Lay-Down Hand'

"The standard argument against Auer deference is that too much power is being given to the agency," said Lisa Soronen, the executive director of the State and Local Legal Center, a Washington organization serving local government associations, which has filed briefs seeking to limit or undo Auer deference.

Just last month, the Supreme Court declined an invitation to use a case about the Education Department's interpretation of its student loan rules to do away with Auer deference. Justice Clarence Thomas, in a dissent from denial of review, claimed that the "doctrine is on its last gasp" because several justices have questioned it.

Last week, the full 4th Circuit court declined to rehear the Gloucester County case. But Judge Paul V. Niemeyer, who was in dissent on the panel, also wrote a short opinion last week challenging the Obama administration's stance. (He also said he did not seek a rehearing vote among his colleagues so the school district's appeal could reach the Supreme Court faster.)

Without citing any French philosophers, Niemeyer said the panel majority in the case "deferred to the administration's novel position [on the transgender issue] with a questionable application of Auer."

The administrative-law experts gave slightly different takes on the legal challenges to the transgender guidance.

Pierce, of George Washington law school, said he was a bit surprised at how "aggressive" the administration was with its interpretation, and that "it's not a lay-down hand" that the guidance would be considered interpretative in nature and deserving of deference.

Wildermuth, who has criticized Auer deference, nevertheless said that while "the Supreme Court has indicated some skepticism, I don't see it eliminating deference for agencies' interpretations of their own regulations."

"We have an agency jumping in to take action on a big, important issue for our nation, and it is looking around at the tools that will allow it to do it," she said.

Vol. 35, Issue 34, Pages 1,22-23

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