Research v. Consumer Prod. Safety Comm'n

91 F.4th 342

CONSUMERS' RESEARCH; By Two, L.P., Plaintiffs—Appellees, v. CONSUMER PRODUCT SAFETY COMMISSION, Defendant—Appellant.

No. 22-40328

United States Court of Appeals, Fifth Circuit

FILED January 17, 2024

Appeal from the United States District Court for the Eastern District of Texas, USDC No. 6:21-CV-256, Jeremy Daniel Kernodle, U.S. District Judge

Brett Shumate, Anthony J. Dick, John Matthew Gore, Brinton Lucas, Jones Day, Washington, DC, for Plaintiff—Appellee Consumers' Research.

Brett Shumate, Anthony J. Dick, John Matthew Gore, Jones Day, Washington, DC, for Plaintiff—Appellee By Two, L.P.

Mark Reiling Freeman, Attorney, Mark Bernard Stern, Esq., U.S. Department of Justice, Civil Division, Appellate Section, Washington, DC, Daniel J. Aguilar, Amanda Mundell, Joshua Marc Salzman, Anna Manchester Stapleton, U.S. Department of Justice, Civil Division, Washington, DC, Chetan Adinath Patil, U.S. Department of Justice, Washington, DC, for Defendant—Appellant.

John Mercer Masslon, II, Washington Legal Foundation, Washington, DC, for Amicus Curiae Washington Legal Foundation.

Gregory Dolin, Senior Litigation Counsel, New Civil Liberties Alliance, Washington, DC, for Amicus Curiae New Civil Liberties Alliance.

Andrew John Pincus, Mayer Brown, L.L.P., Washington, DC, for Amicus Curiae Chamber of Commerce of the United States of America.

R. Trent McCotter, George Mason University, Antonin Scalia Law School, Arlington, VA, for Amicus Curiae Separation of Powers Clinic.

Luke A. Wake, Attorney, Pacific Legal Foundation, Sacramento, CA, for Amicus Curiae Pacific Legal Foundation.

Matthew R. Miller, Esq., Texas Public Policy Foundation, Austin, TX, for Amicus Curiae Texas Public Policy Foundation.

Before Jones, Dennis, and Willett, Circuit Judges.

Don R. Willett, Circuit Judge:

The Supreme Court in recent years has taken a keen interest in administrative law—the law that governs the government—reexamining foundational notions of federal regulatory power.¹ In its current Term, for example, the Court is revisiting so-called Chevron deference, the 40-year-old doctrine under which courts defer to agency interpretations of ambiguous laws.²

Today's case may also attract the Court's interest. It tees up one of the fiercest (and oldest) fights in administrative law: the Humphrey's Executor "exception" to the general "rule" that lets a president remove subordinates at will.³ In this 1935 New Deal-era precedent, which detractors say dilutes the president's constitutional power over the executive branch, the Supreme Court upheld restrictions on the president's authority to remove commissioners of so-called "independent" agencies—those headed by officers who may only be removed for specified causes.⁴

The Humphrey's exception traditionally "has applied only to multi-member bodies of experts."⁵ Sitting en banc, we recently described the exception like this: Congress's decision "limiting the President to 'for cause' removal is not sufficient to trigger a separation-of-powers violation."⁶ Instead, for-cause removal creates a separation-of-powers problem only if it "combine[s]" with "other independence-promoting mechanisms" that "work[ ] together" to "excessively insulate" an independent agency from presidential control.⁷

The plaintiffs in this case argue that the Supreme Court recently upended this framework in Seila Law.⁸ In their view, that 2020 decision held that for-cause removal always creates a separation-of-powers violation—at least if the agency at issue exercises substantial executive power (which nearly all agencies do). This is so, the plaintiffs argue, even if for-cause removal is the only structural feature insulating an agency from total presidential control. We do not read Seila Law so broadly. On the contrary, and as in Free Enterprise Fund,⁹ the Supreme Court in Seila Law left the Humphrey's Executor exception "in place."¹⁰

The Consumer Product Safety Commission is an independent agency whose members the President may remove only for cause. Although the Commission wields what we would today regard as substantial executive power, in every other respect it is structurally identical to the agency that the Supreme Court deemed constitutional in Humphrey's. Yet the district court concluded that the Commission's structure is unconstitutional under Seila Law. We disagree. The Supreme Court expressly "d[id] not revisit Humphrey's Executor or any other precedent" in Seila Law.¹¹

As middle-management circuit judges, we must follow binding precedent, even if that precedent strikes us as out of step with prevailing Supreme Court sentiment. The logic of Humphrey's may have been overtaken, but the decision has not been overruled—at least not yet. Until that happens, Humphrey's controls. Accordingly, we REVERSE and REMAND.

I

Congress created the Consumer Product Safety Commission to "protect the public against unreasonable risks of injury associated with consumer products."¹² The Commission has five members, each of whom the President must appoint and the Senate must confirm.¹³ The members serve staggered, seven-year terms. No more than three of them can "be affiliated with the same political party."¹⁴ Structurally, these features make the Commission a mirror image of the Federal Trade Commission (FTC), an agency whose institutional design the Supreme Court considered in Humphrey's Executor v. United States.¹⁵ The agencies are twins in another respect, too: The President may remove a member of the Commission only for "neglect of duty or malfeasance in office"—that is, only for cause.¹⁶

The Commission has the statutory authority to promulgate safety standards and to ban hazardous products.¹⁷ It also has power to launch administrative proceedings, issue legal and equitable relief, and commence civil actions in federal court.¹⁸ And like other agencies, the Commission must respond to requests for information (and requests for fee waivers) under the Freedom of Information Act (FOIA).¹⁹ The Commission recently issued a rule amending its FOIA regulations—increasing the per-page fee for paper copies by $0.05, and getting rid of duplication fees for electronic copies.²⁰

By Two is a limited partnership that focuses on educational consulting. It has submitted more than 50 FOIA requests to the Commission, and it plans to submit more. It has also asked the Commission for fee waivers under FOIA, and it plans to ask for fee waivers again. In early 2021, Commission staffers denied several of By Two's requests for information relating to safety standards for bouncer seats, infant walkers, toddler carriers, and highchairs. Around the same time, staffers also denied By Two's requests for fee waivers for information related to drop-side cribs. By Two appealed those decisions within the Commission, but the appeals changed nothing.²¹

By Two sued the Commission and asserted three "claims." It styled the first count as "violation of the separation of powers," arguing that "the [C]ommission's structure violates Article II of the U.S. Constitution" because the Commission's members "are removable by the President only "for [cause]." By Two's second count, under the Administrative Procedure Act (APA), argued that the Commission's recent FOIA rule "must be set aside because it was promulgated by an unconstitutionally structured agency." Building on the first two counts, By Two argued in its third count (under FOIA itself) that "[t]he Commission is wrongfully withholding agency records to which [By Two is] entitled by relying upon and enforcing an invalid FOIA rule promulgated by an unconstitutionally structured agency." The upshot is that By Two asserted the same legal theory three times: once each under the Constitution, the APA, and FOIA. By Two argues that this single theory and these three claims entitle it to, among other things, "[a] declaration that the Commission's structure violates Article II of the Constitution," "[a]n order setting aside the Commission's FOIA rule," and "[a]n order setting aside the Commission's denial of Plaintiffs' FOIA requests, including the denial of fee waivers."

A few weeks after it filed suit, By Two moved for "partial summary judgment granting declaratory relief [under Rule 56(a)]" and for "partial final judgment [under Rule 54(b)]"—but only as to Count 1. The Commission opposed the motion, and it moved to dismiss the complaint for lack of standing, for failure to state a claim, and because the Commission and the FTC have the same structure under Humphrey's.

The district court denied the Commission's motion and granted partial summary judgment for By Two.²² It held: "(1) the removal restriction in 15 U.S.C. § 2053(b) violates Article II of the Constitution; (2) [By Two is] entitled to declaratory judgment to ensure that future FOIA requests are administered by a Commission accountable to the President; and (3) a partial final judgment as to Count 1 is proper under Rule 54(b)."²³ The district court's opinion reasoned that, unlike the FTC in 1935, "the Commission exercises substantial executive power and therefore does not fall within the Humphrey's Executor exception."²⁴ The court then certified the order as a final judgment under Rule 54(b). This appeal followed.

II

The standards of review are well settled. We review summary judgment de novo, "applying the same standards as the district court."²⁵ "A party is entitled to summary judgment 'if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.' "²⁶ Likewise, "[w]hether the district court completely disposed of a claim [under Rule 54(b)] is a question we review de novo."²⁷

III

First, jurisdiction.²⁸ The Commission argues that this crucial element is doubly lacking. We disagree. By Two's separation-of-powers claim is distinct from its APA and FOIA claims (under Rule 54(b)), and By Two has standing to assert its constitutional claim (under Article III).

A

"When an action presents more than one claim for...