Texas v. U.S. Part III – Must DAPA be subject to Notice and Comment?

November 10th, 2015

Part I of my analysis focused on standing analysis in Texas v. U.S., and Part II focused on reviewability. Part III analyzes whether DAPA must be submitted for notice-and-comment rulemaking. This inquiry boils down to whether DAPA is exempt as an “interpretive rule” or policy statement, or if DAPA is “substantive.”

The key part of this analysis is the district court’s finding is reviewed for clear error.

Although the DAPA Memo facially purports to confer discretion,126 the district court determined that “[n]othing about DAPA ‘genuinely leaves the agency and its [employees] free to exercise discretion,’”127 a factual finding that we review for clear error.

Judge Hanen’s ruling was “partly informed by analysis of the implementation of DACA, the precursor to DAPA.”

Like the DAPA Memo, the DACA Memo instructed agencies to review applications on a case-by-case basis and exercise discretion, but the district court found that those statements were “merely pretext”129 because only about5% of the 723,000 applications accepted for evaluation had been denied,130 and “[d]espite a request by the [district] [c]ourt, the [g]overnment’s counsel did not provide the number, if any, of requests that were denied [for discretionary reasons] even though the applicant met the DACA criteria . . . .”131 The finding of pretext was also based on a declaration by Kenneth Palinkas, the president of the union representing the USCIS employees pro- cessing the DACA applications, that “DHS management has taken multiple steps to ensure that DACA applications are simply rubberstamped if the appli- cants meet the necessary criteria”;132 DACA’s Operating Procedures, which “contain[] nearly 150 pages of specific instructions for granting or denying  deferred action”;133 and some mandatory language in the DAPA Memo itself.134 In denying the government’s motion for a stay of the injunction, the district court further noted that the President had made public statements suggesting that in reviewing applications pursuant to DAPA, DHS officials who “don’t fol- low the policy” will face “consequences,” and “they’ve got a problem.”135

In a footnote, the court notes that it was not error to describe the process for granting DACA as “mechanical.”

USCIS could not produce any applications that satisfied all of the criteria but were refused deferred action by an exercise of discretion.  … Given that the government offered no evidence as to the bases for other denials, it was not error―clear or otherwise―for the district court to conclude that DHS issued DACA denials under mechanical formulae.

Further, building on points I made in Part II of my series on DAPA’s constitutionality, the court finds no error in the conclusion that DACA “severely restricts agency discretion.”

DHS internal documents further provide that “a series of RFE [ ] templates have been developed and must be used,” and those documents remind repeatedly that “[u]se of these RFE templates is mandatory.” (Emphasis added.) And “[w]hen an RFE is issued, the response time given shall be 87 days.” SOP at 42.

These specific evidentiary standards and RFE steps imposed by the SOP are just examples the district court had before it when it concluded that DACA and DAPA “severely restrict[ ]” agency discretion. Prof’ls & Patients, 56 F.3d at 595. Far from being clear error, such a finding was no error whatsoever.

The Fifth Circuit doesn’t embrace all of Judge Hanen’s findings, but says there is evidence of pretext.

The DACA and DAPA Memos purport to grant discretion, but a rule can be binding if it is “applied by the agency in a way that indicates it is binding,”136 and there was evidence from DACA’s implementation that DAPA’s discretion- ary language was pretextual.

The court next addresses how much can be extrapolated from the DACA memo, and why this must be done carefully.

First, the court notes that those who apply for DACA and DAPA are self-selected.

First, DACA involved issuing benefits to self-selecting applicants, and persons who expected to be denied relief would seem unlikely to apply. But the issue of self-selection is partially mitigated by the finding that “the [g]ov- ernment has publicly declared that it will make no attempt to enforce the law against even those who are denied deferred action (absent extraordinary circumstances).”

Second, DACA and DAPA “are not identical,” in that the covered groups are different, and DAPA makes clear that there is an “exercise of discretion.”

But despite those differences, there are important similarities: The Secretary “direct[ed] USCIS to establish a process, similar to DACA, for exercising prosecutorial discretion,” id. (emphasis added), and there was evi- dence that the DACA application process itself did not allow for discretion, regardless of the rates of approval and denial.139

We make just this point in our 5th Circuit Cato Amicus brief.

In a footnote, the court responds to the dissent’s arguments, and explains why “DACA is an apt comparator to DAPA”:

The district court considered the DAPA Memo’s plain language, in which the Secretary equates the DACA and DAPA proce- dure, background checks, fee exemptions, eligibility for work authorizations, durations of lawful presence and work authorization, and orders DHS to establish, for DAPA, processes similar to those for DACA  … The district court’s conclu- sion that DACA and DAPA would be applied similarly, based as it was in part on the mem- orandum’s plain language, was not clearly erroneous and indeed was not error under any standard of review.

On this point, the dissent contends that DAPA should not be enjoined without an “early snapshot” of how it would be implemented. The majority replies:

The dissent, citing National Mining Ass’n v. McCarthy, 758 F.3d 243, 253 (D.C. Cir. 2014), criticizes the states and the district court for enjoining DAPA without “an early snap- shot” of its implementation. Dissent at 32. First, the dissent overlooks a fundamental prin- ciple of preliminary injunctions: An injunction is of no help if one must wait to suffer injury before the court grants it.  …

DAPA, by contrast, has an effect on regulated entities (i.e. illegal aliens). DAPA removes a categorical bar to illegal aliens who are receiving state and federal benefits, so it places a cost on the states. The states are not required to suffer the injury of that legal impact before seeking an injunction. See id. 252.

The court also seems to embrace the District Court’s finding that none of the proffered denials were based on discretion.

The states properly maintain that those denials were not discretionary but instead were required because of failures to meet DACA’s objective criteria. For example, Neufeld averred that some discretionary denials occurred because applicants “pose[d] a public safety risk,” “[were] suspected of gang membership or gang-related activity, had a series of arrests without convictions” or “ongoing criminal investigations.” As the district court aptly noted, however, those allegedly discretionary grounds fell squarely within DACA’s objective criteria because DACA explicitly incorporated the enforcement priorities articulated in the DACA Operation Instructions and the memorandum styled Policies for Apprehension, Detention, and Removal of Undocumented Immigrants. Dist. Ct. Op., 86 F. Supp. 3d at 669 n.101.

With respect to pretext, the court acknowledges that “As the government points out, there was conflicting evidence on the degree to which DACA allowed for discretion.” Here, in one of the few points, the court found that under the clear error standard only, the district court’s judgment would not be disturbed.

Although Neufeld stated that approxi- mately 200,000 requests for additional evidence had been made upon receipt of DACA applications, the government does not know the number, if any, that related to discretionary factors rather than the objective criteria. Similarly, the government did not provide the number of cases that service-center officials referred to field offices for interviews.141

Although the district court did not make a formal credibility determina- tion or hold an evidentiary hearing on the conflicting statements by Neufeld and Palinkas, the record indicates that it did not view the Neufeld declaration as creating a material factual dispute.142 Further,the government did not seek an evidentiary hearing, nor does it argue on appeal that it was error not to conduct such a hearing. Reviewing for clear error, we conclude that the states have established a substantial likelihood that DAPA would not genuinely leave the agency and its employees free to exercise discretion.

The court references, indirectly in a footnote, to devastating effect, the fact that the government granted “dozens of DAPA applications” even after telling the court that it would not do so.

The United States was also given the chance to show that it planned to put DAPA into effect in a manner different from how it implemented DACA; it failed to take advantage of that opportunity. Further, after assuring the district court that “[USCIS] does not intend to entertain requests for deferred action under the challenged policy until February 18, 2015,” the government later admitted to having approved dozens of DAPA applications and three- year employment authorization to more than 100,000 aliens satisfying the original DACA criteria; the government could not demonstrate which applicants, if any, were rejected on purely discretionary grounds, as distinguished from failure to meet the requirements set forth in the memoranda.

Next, the court turned to whether DAPA was an “agency organization, procedure, or practice.” The test asks if the rule modifies “substantive rights” and “interests can only be nominally procedural.”

DAPAundoubt- edly meets that test—conferring lawful presence on 500,000 illegal aliens residing in Texas forces the state to choose between spending millions of dollars to subsidize driver’s licenses and amending its statutes.

Applying the D.C. Circuit’s “more intricate test” “yields the same result.”

Although the burden imposed on Texas is deriv- ative of conferring lawful presence on beneficiaries, DAPA establishes “‘the substantive standards by which the [agency] evaluates applications’ which seek a benefit that the agency [purportedly] has the power to provide”—a criti- cal fact requiring notice and comment.


(This post is still in progress)