Gilbert Hyatt v. Office of Mgt. and Budget , 908 F.3d 1165 ( 2018 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
GILBERT P. HYATT; AMERICAN No. 17-17101
ASSOCIATION FOR EQUITABLE
TREATMENT, INC., D.C. No.
Plaintiffs-Appellants, 2:16-cv-01944-
JAD-GWF
v.
OFFICE OF MANAGEMENT AND OPINION
BUDGET; SHAUN DONOVAN,
Defendants-Appellees.
Appeal from the United States District Court
for the District of Nevada
Jennifer A. Dorsey, District Judge, Presiding
Argued and Submitted October 12, 2018
Seattle, Washington
Filed November 15, 2018
Before: N. Randy Smith and Morgan Christen, Circuit
Judges, and Robert E. Payne,* District Judge.
Opinion by Judge N.R. Smith
*
The Honorable Robert E. Payne, Senior United States District Judge
for the Eastern District of Virginia, sitting by designation.
2 HYATT V. OFFICE OF MANAGEMENT & BUDGET
SUMMARY**
Paperwork Reduction Act / Administrative
Procedure Act
The panel reversed the district court’s dismissal of a
petition seeking review of the Office of Management and
Budget’s (“OMB”) decision to deny Gilbert Hyatt’s
Paperwork Reduction Act (“PRA”) petition.
The PRA authorizes individuals to petition the OMB for
a determination of whether they must provide information
requested by or for a government agency. In January 2013,
the Patent and Trademark Office (“PTO”) submitted a
number of collections of information to the OMB, as required
by the PRA. The submission included purported collections
of information, contained in PTO Rules 111, 115, and 116,
that had not previously been approved or assigned an OMB
control number. In a July 2013 Determination, the OMB
declared that these purported collections were not subject to
the PRA.
Hyatt filed a complaint in the district court challenging
the OMB’s July 2013 Determination, and the OMB’s denial
of his petition based on the July 2013 Determination. The
district court determined that it lacked subject matter
jurisdiction to hear Hyatt’s asserted Administrative Procedure
Act claims.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
HYATT V. OFFICE OF MANAGEMENT & BUDGET 3
The panel held that judicial review of the denial of
Hyatt’s petition was not barred in this case because it did not
implicate a review of a decision by the OMB to approve or
not act upon a collection of information contained in an
agency rule. The panel concluded that the denial of Hyatt’s
petition was outside the narrow scope of the PRA’s judicial
review bar, and his Administrative Procedure Act claim
challenging the denial of the petition was not statutorily
precluded.
The panel held that the district court erred in determining
that the OMB’s denial of Hyatt’s petition was not a final
agency action. The panel held that in denying Hyatt’s
petition, the OMB made a determination of his rights and
obligation to provide information to the PTO, and it did so in
an action that consummated the OMB’s decisionmaking
process. The panel further held that Hyatt did not have
another adequate remedy in a court.
Finally, the panel considered whether the OMB’s decision
not to provide any remedial action in response to Hyatt’s
petition was discretionary. First, the panel held that the
OMB’s initial determination – whether, under the PRA, the
petitioner must provide or disclose information to a
government agency – was not discretionary; and thus the
OMB’s decision to deny Hyatt’s petition was judicially
reviewable under the Administrative Procedure Act. Second,
the panel held that the OMB’s second determination – of
what appropriate remedial action should be taken, if any –
was committed to the agency’s discretion; and was beyond
judicial review. The panel further held that if the first
determination is reversed after judicial review, the OMB
should revisit its second determination in light of that
reversal.
4 HYATT V. OFFICE OF MANAGEMENT & BUDGET
COUNSEL
Andrew M. Grossman (argued) and Mark W. DeLaquil,
BakerHostetler LLP, Washington, D.C., for Plaintiffs-
Appellants.
Jennifer L. Utrecht (argued) and Mark R. Freeman, Appellate
Staff; Chad A. Readler, Acting Assistant Attorney General;
Civil Division, United States Department of Justice,
Washington, D.C.; Mark R. Paoletta, General Counsel, Office
of Management and Budget, Washington, D.C.; for
Defendants-Appellees.
OPINION
N.R. Smith, Circuit Judge:
The Paperwork Reduction Act (“PRA”) authorizes
individuals to petition the Office of Management and Budget
(“OMB”) for a determination of whether they must provide
information requested by or for a government agency.
44 U.S.C. § 3517(b). Where such a petition does not
challenge an OMB decision “to approve or not act upon a
collection of information contained in an agency rule,” see
44 U.S.C. § 3507(d)(6),1 the subsequent determination is
1
“Collection of information” is defined as
[O]btaining, causing to be obtained, soliciting, or
requiring the disclosure to third parties or the public, of
facts or opinions by or for an agency, regardless of
form or format, calling for either –
HYATT V. OFFICE OF MANAGEMENT & BUDGET 5
subject to judicial review under the Administrative Procedure
Act (“APA”). See 5 U.S.C. § 704. Thus, the district court has
jurisdiction to review the OMB’s decision to deny Gilbert
Hyatt’s PRA petition (“Petition”). We reverse and remand.
I. BACKGROUND
In January 2013, the Patent and Trademark Office
(“PTO”) submitted a number of collections of information to
the OMB, as required by the PRA. See 44 U.S.C. § 3507. The
PTO’s submission included several previously approved
collections of information, which had already been issued an
OMB control number pursuant to § 3507(d).2 The OMB
renewed these collections and their corresponding OMB
control number (0651-0031).
The submission also included purported collections of
information, contained in PTO rules 111, 115, and 116 (“PTO
(i) answers to identical questions posed to, or
identical reporting or recordkeeping requirements
imposed on, ten or more persons, other than
agencies, instrumentalities, or employees of the
United States; or
(ii) answers to questions posed to agencies,
instrumentalities, or employees of the United
States which are to be used for general statistical
purposes. . . .
44 U.S.C. § 3502(3)(A); see also 5 C.F.R. § 1320.3(c), (h) (further
defining “collection of information” and “information”).
2
Before conducting or sponsoring a collection of information, the
collecting agency must “obtain[] from the [OMB] a control number to be
displayed upon the collection of information.” 44 U.S.C. § 3507(a)(3).
6 HYATT V. OFFICE OF MANAGEMENT & BUDGET
Rules”), that had not previously been approved or assigned an
OMB control number.3 The OMB did not approve or
disapprove these purported collections of information.
Instead, on July 31, 2013, the OMB affirmatively declared
that these purported collections were “not subject to the
[PRA]” (“July 2013 Determination”). As a result, the OMB
did not issue a control number for the purported collections.
On August 1, 2013, Hyatt filed his Petition, pursuant to
44 U.S.C. § 3517(b), asking the OMB to determine that he
did not need to disclose the information sought by the PTO
Rules, because the PTO had not obtained an OMB control
number, as required by 44 U.S.C. § 3507(a)(3). The OMB
denied the Petition on September 13, 2013. The agency
referenced its July 2013 Determination, explaining that the
PTO Rules did not contain any collections of information,
because three regulatory exceptions to the definition of
“information” applied. See 5 C.F.R. § 1320.3(h)(1), (6), (9).
Consequently, the agency concluded that the PTO Rules were
not subject to the PRA.
Hyatt filed a complaint with the district court on August
16, 2016, asserting two claims under the APA.4 He
3
The PTO Rules, among other things, describe the information a
patent applicant might provide when filing amendments for a patent
application and when challenging adverse PTO actions. 37 C.F.R.
§§ 1.111, 1.115, 1.116.
4
The American Association for Equitable Treatment, Inc. joined
Hyatt in filing the complaint.
HYATT V. OFFICE OF MANAGEMENT & BUDGET 7
challenged both the OMB’s July 2013 Determination5 and the
OMB’s denial of his Petition, which itself was based on the
July 2013 Determination. On November 11, 2016, the OMB
moved to dismiss the case on the grounds that the district
court lacked subject matter jurisdiction to review the OMB’s
actions under the APA.
The district court granted the motion to dismiss. It
determined that it lacked subject matter jurisdiction to hear
Hyatt’s asserted APA claims on three independent grounds.
First, 44 U.S.C. § 3507(d)(6) precluded judicial review.
Second, the challenged administrative actions did not
constitute final agency actions. Third, the OMB’s decision
(not to provide any remedial action in response to Hyatt’s
Petition) was discretionary. Hyatt timely appealed.
II. STANDARD OF REVIEW
We review de novo “dismissals under Rules 12(b)(1) and
12(b)(6).” Rhoades v. Avon Prod., Inc., 504 F.3d 1151, 1156
(9th Cir. 2007). “In the context of reviewing a decision of an
administrative agency, de novo review means that we ‘view
the case from the same position as the district court.’” Nev.
Land Action Ass'n v. U.S. Forest Serv., 8 F.3d 713, 716 (9th
Cir. 1993) (quoting Marathon Oil Co. v. United States,
807 F.2d 759, 765 (9th Cir. 1986)).
5
To the extent Hyatt challenges the July 2013 Determination under
the PRA, his challenge is foreclosed. We have long recognized that the
PRA “does not authorize a private right of action” against the government.
Sutton v. Providence St. Joseph Med. Ctr., 192 F.3d 826, 844 (9th Cir.
1999). Instead, affirmative challenges to the OMB’s decisions are
authorized only through the petition process laid out by 44 U.S.C.
§ 3517(b). Thus, we do not further analyze the viability of that challenge.
8 HYATT V. OFFICE OF MANAGEMENT & BUDGET
We give no deference to the OMB’s interpretation of the
PRA in this case, because “the question of judicial review” is
“a matter within the peculiar expertise of the courts.” Love v.
Thomas, 858 F.2d 1347, 1352 n.9 (9th Cir. 1988).
III. DISCUSSION
“The APA confers a general cause of action upon persons
‘adversely affected or aggrieved by agency action within the
meaning of a relevant statute.’” Block v. Cmty. Nutrition Inst.,
467 U.S. 340, 345 (1984) (quoting 5 U.S.C. § 702). However,
no cause of action under the APA exists if (1) “statutes
preclude judicial review,” 5 U.S.C. § 701(a)(1); (2) the
relevant agency action is not a “final agency action for which
there is no other adequate remedy in a court,” 5 U.S.C. § 704;
or (3) the “agency action is committed to agency discretion
by law,” 5 U.S.C. § 701(a)(2). See City of Oakland v. Lynch,
798 F.3d 1159, 1165 (9th Cir. 2015).
A. Statutory Preclusion
The district court determined that Hyatt’s APA claim was
statutorily precluded by a provision of the PRA that declares
“[t]he decision by the [OMB] to approve or not act upon a
collection of information contained in an agency rule shall
not be subject to judicial review.” 44 U.S.C. § 3507(d)(6); see
also 5 U.S.C. § 701(a)(1) (prohibiting an APA claim where
“statutes preclude judicial review”). Hyatt argues that judicial
review of the denial of his Petition is not statutorily
precluded, because the Petition did not involve a decision
subject to the PRA’s prohibition. We agree.
There is a “strong presumption that Congress intends
judicial review of administrative action.” Pinnacle Armor,
HYATT V. OFFICE OF MANAGEMENT & BUDGET 9
Inc. v. United States, 648 F.3d 708, 718 (9th Cir. 2011)
(quoting Helgeson v. Bureau of Indian Affairs, 153 F.3d
1000, 1003 (9th Cir. 1998)). Only “a showing of ‘clear and
convincing evidence’ of a contrary legislative intent’” will
overcome that presumption. Id. (quoting Abbott Labs. v.
Gardner, 387 U.S. 136, 140–41 (1967)). “In the context of
preclusion analysis, the ‘clear and convincing evidence’
standard is not a rigid evidentiary test,” and “the presumption
favoring judicial review [is] overcome, whenever the
congressional intent to preclude judicial review is ‘fairly
discernible in the statutory scheme.’” Block, 467 U.S. at 351(quoting Data Processing Serv. v. Camp, 397 U.S. 150, 157
(1970)). “Whether and to what extent a particular statute
precludes judicial review is determined not only from its
express language, but also from the structure of the statutory
scheme, its objectives, its legislative history, and the nature
of the administrative action involved.” Id. at 345. The
presumption has not been overcome in this case.
The PRA provides that agencies cannot “conduct or
sponsor” a “collection of information” unless they comply
with several procedural requirements. 44 U.S.C. § 3507(a).
Those requirements include conducting a review of the
proposed collection, providing notice of the proposed
collection in the Federal Register, receiving and evaluating
the public comments, submitting the proposed collection and
relevant documents to the OMB, and obtaining an OMB
control number “to be displayed upon the collection of
information.” Id.; id. § 3506(c). When a proposed collection
of information is submitted for OMB review, the OMB may
either expressly approve or disapprove the proposed
collection or implicitly approve it by not acting upon it. See
44 U.S.C. § 3507(c), (d). If the collection of information is
approved, whether expressly or implicitly, the OMB must
10 HYATT V. OFFICE OF MANAGEMENT & BUDGET
assign a control number to the collection. Id. § 3507(a), (c),
(d); 5 C.F.R. § 1320.11(i).
Within this context, the PRA’s bar on judicial review,
44 U.S.C. § 3507(d)(6), is demonstratively narrow in scope.
For example, it does not prohibit judicial review of an OMB
decision to approve collections that are not contained in an
agency rule. See 44 U.S.C. § 3507(c). Nor does it foreclose
judicial review of an OMB decision to disapprove
collections, regardless of whether those collections are
contained in an agency rule. See generally Dole v. United
Steelworkers of Am., 494 U.S. 26 (1990) (reviewing the
OMB’s disapproval of three provisions in regulations
established by the Department of Labor). Thus, the statute
precludes judicial review only of a decision by the OMB to
approve, whether through express approval or a failure to act
upon, a collection within an agency rule. Any other decision
remains subject to judicial review. See Silvers v. Sony
Pictures Entm’t, Inc., 402 F.3d 881, 885 (9th Cir. 2005) (en
banc) (“The doctrine of expressio unius est exclusio alterius
‘as applied to statutory interpretation creates a presumption
that when a statute designates certain persons, things, or
manners of operation, all omissions should be understood as
exclusions.’” (quoting Boudette v. Barnette, 923 F.2d 754,
756–57 (9th Cir. 1991))).
Judicial review of the denial of Hyatt’s Petition is not
barred in this case, because it does not implicate a review of
a decision by the OMB to approve or not act upon a
collection of information contained in an agency rule.6 The
6
We reject Hyatt’s assertion that the PRA’s judicial review
prohibition applies only to OMB decisions regarding collections of
information contained in proposed agency rules currently undergoing the
HYATT V. OFFICE OF MANAGEMENT & BUDGET 11
Petition was denied based on the OMB’s July 2013
Determination, that the purported collections of information
in the PTO Rules fell outside the PRA. That determination
was not a decision to approve or not act upon a collection of
information contained within an agency rule.
In a vacuum, the phrase “decision . . . to . . . not act
upon,” 44 U.S.C. § 3507(d)(6), might be interpreted broadly,
to incorporate the July 2013 Determination. However, the
statutory scheme of the PRA demands a narrower
interpretation, because the legal consequence of a decision to
not act upon a collection of information under the PRA is
exactly the same as that of a decision to expressly approve the
collection—an OMB control number is issued that the
collecting agency must display on the collection. 44 U.S.C.
§ 3507(a), (c), (d); 5 C.F.R. § 1320.11(i). In other words,
where an OMB decision does not result in the issuance of an
notice and comment process. Unlike 44 U.S.C. § 3507(d)(1), which
specifically refers to “proposed” agency rules, subsection (d)(6) is not so
limited: “[t]he decision by the Director to approve or not act upon a
collection of information contained in an agency rule shall not be subject
to judicial review,” 44 U.S.C. § 3507(d)(6) (emphasis added). Congress
understood the difference between proposed agency rules and agency rules
in general, and determined not to limit the bar on judicial review to
proposed rules.
In that light, § 3507(d)(5)’s declaration that “[t]his subsection shall
apply only when an agency publishes a notice of proposed rulemaking and
requests public comments” is best read not as limiting the application of
the PRA’s bar of judicial review, which is found in the same subsection,
but merely as indicating that rules that are exempt from the standard notice
and comment rulemaking process need not comply with § 3507(d)’s
supplementary notice and comment requirements. See, e.g., 5 U.S.C.
§ 553(a) (exempting certain rules from the standard notice and comment
rulemaking process).
12 HYATT V. OFFICE OF MANAGEMENT & BUDGET
OMB control number, it cannot be construed as a decision to
not act upon a collection of information.
That is the case here—the July 2013 Determination did
not result in the issuance of a control number for the
purported collections of information in the PTO Rules. See
5 C.F.R. § 1320.11(i). Indeed, in determining that the PRA
did not apply to the purported collections, the OMB entirely
negated any need for the PTO to obtain or display a control
number for those collections. See 44 U.S.C. § 3507(a)(3).
Accordingly, the denial of Hyatt’s Petition lies outside the
narrow scope of the PRA’s judicial review bar, and his APA
claim challenging the denial of the Petition is not statutorily
precluded.
B. Final Agency Action
The district court next determined that the OMB’s denial
of Hyatt’s Petition was not a “final agency action for which
there is no other adequate remedy in a court,” as required by
5 U.S.C. § 704. A “final” agency action is one that both
determines “rights or obligations . . . from which legal
consequences will flow” and “mark[s] the ‘consummation’ of
the agency’s decisionmaking process.” Bennett v. Spear,
520 U.S. 154, 177–78 (1997) (internal citations omitted).
Section 3517(b), which governs Hyatt’s Petition,
expressly requires the OMB to determine a petitioner’s
obligation to provide information requested by or for a
government agency. It permits “any person” to “request the
Director to review any collection of information conducted by
or for an agency to determine, if, under this subchapter, a
person shall maintain, provide, or disclose the information to
or for the agency.” Id. (emphasis added). After receiving the
HYATT V. OFFICE OF MANAGEMENT & BUDGET 13
request, the OMB “shall . . . respond to the request within
60 days”7 and “take appropriate remedial action, if
necessary.” Id.Additionally, the statute does not provide for any
administrative review of the OMB’s response, nor does it
provide any alternative administrative recourse for petitioners
if the OMB determines that they must provide the relevant
information to the collecting agency. Id. Therefore, in
denying Hyatt’s Petition, the OMB made a determination of
his rights and obligation to provide information to the PTO,
and it did so in an action that consummated the OMB’s
decisionmaking process.
However, Hyatt’s APA claim would still be precluded if
he has another adequate remedy in a court. 5 U.S.C. § 704.
An adequate alternative remedy in a court exists where “a
legal remedy under the APA would impermissibly provide for
duplicative review.” City of Oakland, 798 F.3d at 1165. In
looking for such a remedy, we ask whether the statutory
scheme “provides a forum for adjudication, a limited class of
potential plaintiffs, a statute of limitations, a standard of
review, and authorization for judicial relief.” Hinck v. United
States, 550 U.S. 501, 506 (2007); see also City of Oakland,
798 F.3d at 1165–66 (discussing Hinck).
The PRA does not provide a forum for adjudication, a
limited class of potential plaintiffs, a statute of limitations, a
standard of review, or an authorization for any manner of
judicial relief. See e.g., 44 U.S.C. § 3517. In fact, the PRA
7
The OMB can extend this period “to a specified date” if “the person
making the request is given notice of such extension.” 44 U.S.C.
§ 3517(b)(1).
14 HYATT V. OFFICE OF MANAGEMENT & BUDGET
“does not authorize a private right of action” against the
government. Sutton, 192 F.3d at 844. The district court and
the OMB agree.
Instead, the district court and the OMB suggest that Hyatt
nevertheless has an adequate alternative remedy through the
PRA’s “public protection provision,” which provides that “no
person shall be subject to any penalty for failing to comply
with a collection of information that is subject to [the PRA]”
if either (1) the collection “does not display a valid OMB
control number,” or (2) the collecting agency “fails to inform
the person” that he or she “is not required to respond to the
collection of information unless it displays a valid control
number.” 44 U.S.C. § 3512(a). However, the public
protection provision functions only as a defense to an
enforcement action brought by an agency, not as an
independent mechanism for a person to affirmatively
challenge the validity of the collection of information.
44 U.S.C. § 3512(b). That sort of alternative remedy is
insufficient to defeat an APA claim, as “parties need not
await enforcement proceedings before challenging final
agency action where such proceedings carry the risk of
‘serious criminal and civil penalties.’” U.S. Army Corps of
Eng’rs v. Hawkes Co., 136 S. Ct. 1807, 1815 (2016) (quoting
Abbott Labs., 387 U.S. at 153).
If Hyatt withheld information from the PTO, believing
that the public protection provision would protect him in a
subsequent enforcement action, he would risk the forfeiture
of his patent claims if his belief proved unwarranted. Hyatt
“need not assume such risks while waiting for [the PTO] to
‘drop the hammer’ in order to have [his] day in court.” Id.(quoting Sackett v. EPA, 566 U.S. 120, 127 (2012)). He is
entitled instead to have the OMB determine his obligations,
HYATT V. OFFICE OF MANAGEMENT & BUDGET 15
44 U.S.C. § 3517(b), and to have that determination judicially
reviewed before deciding whether to provide the requested
information to the PTO.
C. Non-Discretionary Action
Finally, the district court determined that the OMB’s
decision not to provide any remedial action in response to
Hyatt’s Petition was discretionary. An APA claim is
precluded where the relevant “agency action is committed to
agency discretion by law.” 5 U.S.C. § 701(a)(2). “An action
is committed to agency discretion where there is no
‘meaningful standard against which to judge the agency’s
exercise of discretion.’” Bear Valley Mut. Water Co. v.
Jewell, 790 F.3d 977, 989 (9th Cir. 2015) (quoting Heckler v.
Chaney, 470 U.S. 821, 830 (1985)).
The PRA directs the OMB to take two distinct actions
when it receives a petition to determine whether an individual
is legally obligated to respond to a collection of information.
First, the OMB “shall . . . respond to the request within 60
days of receiving the request.” 44 U.S.C. § 3517(b)(1)
(emphasis added). Second, it “shall . . . take appropriate
remedial action, if necessary.” Id. § 3517(b)(2).
The initial determination—whether, under the PRA, the
petitioner must provide or disclose information to a
government agency—is not discretionary. There is an express
mandate that the OMB “shall” make such a determination. Id.
§ 3517(b); Lexecon Inc. v. Milberg Weiss Bershad Hynes &
Lerach, 523 U.S. 26, 35 (1998) (“[T]he mandatory ‘shall’ . . .
normally creates an obligation impervious to judicial
16 HYATT V. OFFICE OF MANAGEMENT & BUDGET
discretion.”).8 Additionally, the standards for making such a
determination are specified by the PRA. See 44 U.S.C.
§ 3507(a) (outlining steps an agency must take before it may
conduct a collection of information). Thus, the OMB’s
decision to deny Hyatt’s Petition is judicially reviewable
under the APA.
On the other hand, the second determination—of what
appropriate remedial action should be taken, if any—is
committed to the agency’s discretion. Although this
determination is also mandatory, the OMB is directed to take
“appropriate” remedial action, and only “if necessary.” Id.§ 3517(b)(2). There is no express standard in the PRA to
guide the OMB in determining whether any particular remedy
is either “appropriate” or “necessary.” Accordingly, the
OMB’s decision regarding whether or what remedial action
should be taken is beyond judicial review. See United States
v. George S. Bush & Co., 310 U.S. 371, 380 (1940).
However, if the first determination is reversed after judicial
8
The OMB argues that when it determines that the relevant
information request is not a collection of information, it is not required to
respond to a § 3517 petition, which asks the OMB to review “any
collection of information.” Such an interpretation would allow the OMB
to abdicate its duties under the PRA—without judicial review—by simply
declaring that no information requests constitute collections of
information. Nothing in the statutory scheme suggests Congress intended
to provide the OMB with such extreme power. See Anchorage Sch. Dist.
v. M.P., 689 F.3d 1047, 1056 (9th Cir. 2012) (noting that an agency
“cannot abdicate its affirmative duties” assigned by Congress). The
OMB’s interpretation would also eliminate any legal protection for
persons who believe that the agency’s decision was faulty. See 44 U.S.C.
§ 3512(a) (“[N]o person shall be subject to any penalty for failing to
comply with a collection of information that is subject to this subchapter
. . . .” (emphasis added)).
HYATT V. OFFICE OF MANAGEMENT & BUDGET 17
review, the OMB should revisit its second determination in
light of that reversal.
IV. CONCLUSION
Because the denial of Hyatt’s Petition is judicially
reviewable under the APA, we REVERSE the district court’s
decision to dismiss this case for a lack of subject matter
jurisdiction and REMAND to the district court to review the
denial.