By Andrew H. Perellis, Patrick D. Joyce, and Craig B. Simonsen

Seyfarth Synopsis: In another business-friendly move, the U.S. Department of Justice (DOJ) recently updated its Justice Manual to clarify that it “should not treat a party’s noncompliance with a guidance document as itself a violation of applicable statutes or regulations [or to] establish a violation by reference to statutes and regulations.”

We had blogged in early 2018 regarding Associate Attorney General Rachel Brand’s memorandum “Limiting Use of Agency Guidance Documents In Affirmative Civil Enforcement Cases.” (Brand Memo), which indicated that the Department would no longer prosecute cases based solely on violations of various agencies’ “guidance documents”. Now DOJ has taken it a step further by adding a section to its Justice Manual (Manual) titled: “Limitation on Use of Guidance Documents in Litigation..” The new section was effective in December 2018.

Under the updated Manual, DOJ (which effectively acts as “outside counsel” to departments and agencies including the DOL, EPA, OSHA, ATF and DEA, among others, in cases exceeding certain penalty thresholds and other criteria) may no longer prosecute cases against alleged violators unless the violations are of properly promulgated (through “notice and comment” rulemaking) regulatory requirements, not agency guidance documents or policies.

The Brand Memo itself was a follow-up to an earlier memo issued by Attorney General Jeff Sessions on November 16, 2017 (Sessions Memo), which instituted a new policy that prohibits the Department of Justice from using its civil enforcement authority to convert agency guidance documents into binding rules. The Sessions Memo “prevent[ed] the Department of Justice from evading required rulemaking processes by using guidance memos to create de facto regulations. In the past, the Department of Justice and other agencies had blurred the distinction between regulations and guidance documents.”

Under the DOJ’s new policy, DOJ civil litigators are “prohibited from using guidance documents—or noncompliance with guidance documents—to establish violations of law in affirmative civil enforcement actions.” The Brand Memo also indicates that “the [Sessions Memo]. . . prohibits the Department from using its guidance documents to coerce regulated parties into taking any action or refraining from taking any action beyond what is required by the terms of the applicable statute or lawful regulation.” Finally, the Brand Memo confirms that the DOJ “…should not treat a party’s noncompliance with an agency guidance document as presumptively or conclusively establishing that the party violated the applicable statute or regulation.”

While the Brand Memo applied only to affirmative civil enforcement actions brought by the DOJ, we see the updated Manual, Sessions Memo and the Brand Memo as welcome relief from arbitrary use of guidance by departments and agencies such as the DOL, OSHA, or EPA in enforcement proceedings of regulated industry.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Seyfarth OSHA Compliance, Enforcement & Litigation Team or the Environmental Compliance, Enforcement & Permitting Team.

By Jeryl L. OlsonPatrick D. Joyce, and Craig B. Simonsen

Seyfarth Synopsis:  In another business-friendly move, the U.S. Department of Justice (USDOJ) recently directed its Attorneys to not use its civil enforcement authority for violations based on agency guidance documents.

On January 25, 2018, Associate Attorney General Rachel Brand released an Department memo “Limiting Use of Agency Guidance Documents In Affirmative Civil Enforcement Cases.” (“Brand Memo”), directed to the Heads of Civil Litigating Components within the USDOJ directing that the Department no longer prosecute cases based solely on violations of various agencies’ “guidance documents”.

The USDOJ, (which effectively acts as “outside counsel” to departments and agencies including the DOL, EPA, OSHA, ATF and DEA, among others, in cases exceeding certain penalty thresholds and other criteria) may no longer prosecute cases against alleged violators unless the violations are of properly promulgated regulatory requirements, not agency guidance documents or policies. The practice of agencies, such as EPA, pursuing enforcement actions against companies who have failed to comply with “guidance” has long been a concern of the regulated community and their defense counsel; we frequently challenge and object to EPA’s efforts to enforce “guidance” that has not gone through public notice ad comment rulemaking. It is a relief that the USDOJ will no longer be a party to such enforcement cases.

The Brand Memo is a follow-up to an earlier memo issued by Attorney General Jeff Sessions on November 16, 2017 (“Guidance Policy” or “Sessions Memo”), which instituted a new policy that prohibits the Department of Justice from using its civil enforcement authority to convert agency guidance documents into binding rules. The Sessions Memo “prevents the Department of Justice from evading required rulemaking processes by using guidance memos to create de facto regulations. In the past, the Department of Justice and other agencies had blurred the distinction between regulations and guidance documents.”

The Brand Memo states that “…consistent with our duty to uphold the rule of law with fair notice and due process, this policy helps restore the appropriate role of guidance documents and avoids rulemaking by enforcement.” “Although guidance documents can be helpful in educating the public about already existing law, they do not have the binding force or effect of law and should not be used as a substitute for rulemaking.”

Under the USDOJ’s new policy, USDOJ civil litigators are “prohibited from using guidance documents—or noncompliance with guidance documents—to establish violations of law in affirmative civil enforcement actions.”The Brand Memo also indicates that “the Guidance Policy . . . prohibits the Department from using its guidance documents to coerce regulated parties into taking any action or refraining from taking any action beyond what is required by the terms of the applicable statute or lawful regulation.” Finally, the Brand Memo confirms that the USDOJ “…should not treat a party’s noncompliance with an agency guidance document as presumptively or conclusively establishing that the party violated the applicable statute or regulation.”

While the Brand Memo applies only to future affirmative civil enforcement actions brought by the Department, as well as, “wherever practicable,” those matters pending as of January 25, 2018, we see the Guidance Policy and the Brand Memo as welcome relief from arbitrary use of guidance by departments and agencies such as the DOL, OSHA, or EPA in enforcement proceedings of regulated industry.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Seyfarth Labor & Employment Group, OSHA Compliance, Enforcement & Litigation Team, or the Environmental Compliance, Enforcement & Permitting Team.