Supreme Court Decision Raises Interesting Questions Regarding Judicial Review of Agency Action, Provides Few Answers

March 23, 2012

By JP Ellison

We previously reported on the oral arguments in the Supreme Court case Sackett v. EPA that raised the question of when agency action was sufficiently final to allow a party to seek review in federal court.  Earlier this week the Supreme Court handed down its decision in a unanimous 9-0 ruling that the EPA’s compliance order was final agency action reviewable in federal court under the APA.  The Court’s decision is an important one, but readers of the decision will find few definitive answers as to its broader implications.

We don’t think it will take long for an FDA regulated entity to cite Sackett as the basis of challenging an FDA Warning Letter, or other agency enforcement action that the agency claims is not final.  If nothing else, Sackett makes is clear that an agency’s characterization of its enforcement activities as a means to achieve “voluntary compliance” is not dispositive on the issue of whether agency action is final.  See, .e.g., FDA Regulatory Procedures Manual, 4-1 (“Warning Letters are issued to achieve voluntary compliance . . . ”) available here

The success of a Sackett-based argument that a Warning Letter —or other agency action— constitutes final agency action will turn on the specific context.  In Sackett, the Court identified several aspects of the EPA compliance orders that contributed to the conclusion that the orders constituted final agency action:

  • the order determined rights or obligations; 
  • legal consequences flowed from the issuance of the order; and 
  • the order marked the consummation of the agency’s decision-making.

Many FDA Warning letters would seem to satisfy these criteria.  See, e.g., letters posted here (Withholding approval of drug applications and imposition of import alert) and here (no premarket approval and federal agencies advised of warning letter to consider when awarding contracts).  Other agency action may similarly meet these criteria.  It may be that one result of Sackett will be a thorough review of agency correspondence in an attempt to insulate future agency action from court review. 

In addition, based on the facts at issue in Sackett and Justice Ginsburg’s concurring opinion in the case, one could see federal agencies arguing that to the extent that Sackett is at all applicable, it only governs in those instances when the question is whether the agency has jurisdiction.  There is nothing in the Court’s opinion that imposes such a limitation, however. 

In any event, while Sackett provides an opening to challenge FDA’s position on what is final agency action, including but not limited to the position that it “does not consider Warning Letters to be final agency action on which it can be sued” (see our previous post here), such an argument needs to be carefully considered and crafted to maximize its chances for success.

Categories: Enforcement