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Agencies As Adversaries***

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Agencies As Adversaries*** Agencies as Adversaries*** Daniel A. Farber* & Anne Joseph O’Connell** Conflict between agencies and outsiders—whether private stakeholders, state governments, or Congress—is the primary focus of administrative law. But battles also rage within the administrative state: federal agencies, or actors within them, are the adversaries. Recent examples abound. In President Obama’s administration, there was the battle between the Federal Bureau of Investigation and the Department of Defense over hacking the iPhone of one of the San Bernardino shooters, the conflict between the State Department and the Central Intelligence Agency over classifying some aspects of Secretary Hillary Clinton’s emails, and the sharp division between the Republican and Democratic members of the Federal Communications Commission on net neutrality. President Trump’s administration has begun with intense internal conflict. After President Trump issued his first immigration executive order, fights started—largely between holdover appointees (as well as career bureaucrats) and the new boss. Battles have also erupted among President Trump’s chosen lieutenants in the White House and in the cabinet. While the President has denounced his opponents, he is also fostering conflict by choosing cabinet secretaries with whom he knows he has policy disagreements, placing loyalists in key agency staff positions as monitors, and selecting adversaries for top White House slots. DOI: https://dx.doi.org/10.15779/Z38H12V721 Copyright © 2017 California Law Review, Inc. California Law Review, Inc. (CLR) is a California nonprofit corporation. CLR and the authors are solely responsible for the content of their publications. *** This project has benefited from helpful suggestions by participants at the Berkeley Law International and Comparative Administrative Law Conference, the Berkeley Law Half-Baked Faculty Workshop, the George Mason University Revisiting Judicial Deference Roundtable, the Northwestern Law Faculty Workshop, the Stanford Law School Faculty Workshop, and the Administrative Law Forum at the Université Paris-Dauphine. We are particularly grateful to Neal Devins, Jonathan Glater, Abbe Gluck, Daniel Ho, Tonja Jacobi, Mark Lemley, Gillian Metzger, Jennifer Nou, Jamie O’Connell, Lisa Ouellette, Daphna Renan, Miriam Seifter, Bijal Shah, Catherine Sharkey, Matthew Stephenson, Seth Barrett Tillman, Adam White, and Judge Stephen Williams for feedback. We thank Edna Lewis, Dean Rowan, and I-Wei Wang in the Berkeley Law Library as well as Alison Caditz for their terrific research assistance and the editors of the California Law Review for their tremendous work. Farber received funding from George Mason University’s Center for the Study of the Administrative State for his work on and presentation of the project. * Farber is the Sho Sato Professor of Law at Berkeley Law. 1375 1376 CALIFORNIA LAW REVIEW [Vol. 105:1375 This Article draws on rich institutional accounts to illuminate and classify the plethora of agency conflicts and dispute resolution mechanisms. Then, by applying social scientific work on agency and firm design, as well as constitutional theory, we aim to explain the creation of such conflict––largely by Congress and the White House but sometimes by the courts––and to evaluate its desirability. We assess the characteristics of conflict against economic, political, and philosophical criteria to suggest lessons for institutional design in the modern administrative state. In contrast to much of the existing literature, we focus on the potentially positive contribution of agency conflict to effective democratic governance. Finally, we use our descriptive, positive, and normative work on agency conflict to contribute to longstanding legal debates and to flag important legal issues that have generated little attention. For instance, we investigate the constitutional limits of congressionally or judicially created conflict within the executive branch, the application of deference doctrines in the face of agency disagreement, and the ability of agencies to take conflicting positions directly or indirectly in the courts themselves. Introduction .......................................................................................... 1378 I. Typology of Adversarial Relationships ............................................. 1387 A. Agency Conflict in a Hard Hierarchy ................................ 1390 1. Hard Hierarchies Between Executive Agencies .......... 1390 2. Interagency Hard Hierarchies and Quasi-Independent Agencies ...................................................................... 1391 3. Hard Hierarchies Within the Agency ........................... 1392 a. Between Different Politically Accountable Agents ................................................................... 1392 b. Between Political Officials and Civil Servants ..... 1393 B. Agency Conflict in a Soft Hierarchy ................................. 1394 1. Soft Hierarchies Between Executive Agencies ............ 1394 2. Interagency Soft Hierarchies and Quasi-Independent Agencies ...................................................................... 1395 3. Soft Hierarchies Within the Agency ............................ 1 3 9 5 a. Between Different Politically Accountable Agents Entirely Within the Agency .................................. 1396 b. Between Politically Accountable Agents and IGs 1396 c. Between Chairs and Members of Multimember Agencies ................................................................ 1397 C. Agency Conflict in Advisory and Monitoring Relationships ...................................................................... 1397 ** O’Connell is the George Johnson Professor of Law at Berkeley Law. 2017] AGENCIES AS ADVERSARIES 1377 1. Advising and Monitoring Between Executive Agencies ...................................................................... 1398 2. Interagency Advising and Monitoring and Quasi- Independent Agencies .................................................. 1400 3. Advising and Monitoring Within the Agency ............. 1401 a. Employees Within Agencies ................................. 1401 b. Advisory Boards for Agencies .............................. 1402 D. Agency Conflict in Symmetrical Relationships ................. 1403 1. Symmetrical Relationships Between Executive Agencies ...................................................................... 1404 2. Interagency Symmetrical Relationships and Quasi- Independent Agencies .................................................. 1404 3. Symmetrical Relationships Within the Agency ........... 1405 a. Between Subagencies in Executive Agencies ....... 1405 b. Between Representatives in Multimember Organizations ........................................................ 1405 E. Providing a Unified Typology ........................................... 1407 II. Mechanisms of Conflict Resolution ................................................. 1408 A. Outside the Courts ............................................................. 1409 1. Negotiation and Mediation .......................................... 1409 2. Adjudication of Administrative Disputes .................... 1412 3. Voting and Consensus ................................................. 1413 B. The Courts ......................................................................... 1415 III. Positive and Normative Assessment of Adversarial Relationships 1416 A. Hard Hierarchical Relationships ........................................ 1417 1. Design Choices: Centralizing Control ......................... 1417 2. Normative Implications: Power of the President ......... 1418 B. Advising and Monitoring Relationships ............................ 1419 1. Design Choices: Generating Information .................... 1420 2. Normative Implications: Internal Checks and Balances ....................................................................... 1422 C. Symmetrical Relationships ................................................ 1423 1. Design Choices: Creating Competition ....................... 1424 2. Normative Implications: Benefits and Costs of Redundancy ................................................................. 1425 D. Takeaways ......................................................................... 1429 IV. Legal Dimensions of Agency Conflict ........................................... 1432 A. Presidential Control Over the Bureaucracy ....................... 1432 1. Classic Debate in New Form ....................................... 1432 2. Centralized Control Over Agencies and Its Limits ...... 1436 a. Guantánamo Bay ................................................... 1436 b. Solicitor General ................................................... 1437 c. Presidential Reorganization .................................. 1441 B. Congress and Adversarial Administrative Relationships ... 1442 1378 CALIFORNIA LAW REVIEW [Vol. 105:1375 1. Appointments Restrictions ........................................... 1443 2. Reporting and Access Requirements ........................... 1446 3. Subdelegation .............................................................. 1447 C. Courts as Conflict Resolution ............................................ 1450 1. Chevron with Multiple Agencies ................................. 1450 2. State Farm with Adversarial Agencies ........................ 1457 3. Procedural Issues: Rule 19 and Discovery ................... 1463 4. Agencies Suing Each Other ......................................... 1464 Conclusion ...........................................................................................
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