National Federation of Independent Business v. Dougherty et al

Brief/Memorandum in Support

N.D. Tex.November 14, 2016

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION NATIONAL FEDERATION OF INDEPENDENT BUSINESS, Plaintiff, v. DOROTHY DOUGHERTY, in her official capacity as Deputy Assistant Secretary of Labor for the Occupational Safety and Health Administration, et al., Defendants. Civil Action No. 3:16-cv-02568-D DEFENDANTS’ BRIEF IN SUPPORT OF THEIR MOTION TO DISMISS Respectfully submitted, JOHN R. PARKER UNITED STATES ATTORNEY /s/ Lisa R. Hasday Lisa R. Hasday Assistant United States Attorney Texas State Bar No. 24075989 1100 Commerce Street, Third Floor Dallas, Texas 75242-1699 Telephone: 214-659-8737 Facsimile: 214-659-8807 Email: Lisa.Hasday@usdoj.gov OF COUNSEL: Anne Ryder Godoy Attorney, OSH Division U.S. Department of Labor Office of the Solicitor, Suite S-4004 200 Constitution Avenue, NW Washington, D.C. 20210 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 1 of 32 PageID 85 i Table of Contents Table of Authorities .............................................................................................................................. iii I. Introduction ....................................................................................................................................... 1 II. Background ...................................................................................................................................... 2 A. OSHA Inspections of Employer Worksites Under The OSH Act ....................................... 2 B. The 2013 Letter .................................................................................................................... 3 C. NFIB’s Complaint................................................................................................................ 4 III. Argument ........................................................................................................................................ 5 A. The Court Lacks Subject-Matter Jurisdiction to Consider NFIB’s Challenges to OSHA’s 2013 Letter................................................................................................................................. 5 1. NFIB Lacks Standing to Bring This Action. ............................................................ 6 a. NFIB Has Suffered No Injury. ..................................................................... 6 b. No Causal Connection Exists Between Any Injury and the Challenged Action.. ............................................................................................................. 9 c. A Favorable Judgment Would Not Redress Any Injury.. ............................ 9 2. NFIB’s Lawsuit Is Not Ripe for Judicial Review. ................................................. 10 a. The Issues Are Not Purely Legal.. ............................................................. 10 b. The 2013 Letter is Not a Final Agency Action... ...................................... 11 c. The 2013 Letter Has No Direct or Immediate Impact on NFIB.... ............ 11 d. The Suit Does Not Foster Effective Agency Enforcement and Administration..... ........................................................................................... 12 3. NFIB Cannot Bring Suit Under the APA Because It Does Not Challenge a Final Agency Action. ........................................................................................................... 13 4. The OSH Act Precludes this Court’s Pre-Enforcement Review of an OSHA Interpretative Letter. ................................................................................................... 15 5. NFIB Cannot Bring this Suit Because It Has an Adequate Legal Remedy. .......... 19 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 2 of 32 PageID 86 ii B. NFIB’s Suit Should Be Dismissed for Failure to State a Claim Upon Which Relief May Be Granted. .............................................................................................................................. 20 1. The 2013 Letter is an Interpretative Rule Exempt from Notice-and-Comment Rulemaking. ................................................................................................................ 21 2. OSHA’s 2013 Letter is Consistent with the OSH Act and Its Implementing Regulations. ................................................................................................................ 23 IV. Conclusion .................................................................................................................................... 25 Certificate of Service ........................................................................................................................... 26 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 3 of 32 PageID 87 iii Table of Authorities Statutes Administrative Procedure Act of 1946 5 U.S.C. § 553 ......................................................................................................................... 21 5 U.S.C. § 553(b)(3)(A) .......................................................................................................... 21 5 U.S.C. § 703 ......................................................................................................................... 17 5 U.S.C. § 704 ................................................................................................................... 13, 19 5 U.S.C. § 706(2)(A), (C), (D) ................................................................................................ 20 Occupational Safety and Health Act of 1970 29 U.S.C. § 651(b)(3) .............................................................................................................. 17 29 U.S.C. § 655(b) ..................................................................................................................... 2 29 U.S.C. § 657(a) ..................................................................................................................... 2 29 U.S.C. § 657(a)(2) ................................................................................................................ 2 29 U.S.C. § 657(b) ................................................................................................................... 17 29 U.S.C. § 657(c) ..................................................................................................................... 2 29 U.S.C. § 657(c)(1) ................................................................................................................ 2 29 U.S.C. § 657(e) ............................................................................................................... 2, 23 29 U.S.C. § 659(c) ........................................................................................................ 17, 19-20 29 U.S.C. § 660(a) ....................................................................................................... 17, 18, 20 29 U.S.C. § 660(b) ................................................................................................................... 17 29 U.S.C. § 660(c)(2) .............................................................................................................. 17 29 U.S.C. § 661(j).............................................................................................................. 17, 20 29 U.S.C. § 662(a) ................................................................................................................... 17 29 U.S.C. § 662(d) ................................................................................................................... 17 29 U.S.C. § 666 ......................................................................................................................... 7 29 U.S.C. § 666(l).................................................................................................................... 17 Regulations 29 C.F.R. Part 1903 ................................................................................................................... 2 29 C.F.R. § 1903.3..................................................................................................................... 2 29 C.F.R. § 1903.4..................................................................................................................... 8 29 C.F.R. § 1903.4(a) ............................................................................................................ 3, 7 29 C.F.R. § 1903.4(d) ................................................................................................................ 3 29 C.F.R. § 1903.7..................................................................................................................... 2 29 C.F.R. § 1903.7(b) ................................................................................................................ 2 29 C.F.R. § 1903.8............................................................................................................ passim 29 C.F.R. § 1903.8(a) ................................................................................................................ 2 29 C.F.R. § 1903.8(a)-(d) .......................................................................................................... 4 29 C.F.R. § 1903.8(b) ................................................................................................................ 3 29 C.F.R. § 1903.8(c) ....................................................................................................... passim Rules Fed. R. Civ. P. 12(b)(1) ..................................................................................................... 1, 3, 5 Fed. R. Civ. P. 12(b)(6) ................................................................................................... 1, 5, 20 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 4 of 32 PageID 88 iv Cases Abbott Labs v. Gardner, 387 U.S. 136 (1967) ............................................................................... 10, 12 Alfonso v. United States, 752 F.3d 622 (5th Cir. 2014) ......................................................................... 5 American Hospital Ass’n v. Bowen, 834 F.2d 1037 (D.C. Cir. 1987) ................................................. 22 Am. Mining Cong. v. MSHA, 995 F.2d 1106 (D.C. Cir. 1993) ............................................................ 22 Am. Tort Reform Ass’n v. OSHA, 738 F.3d 387 (D.C. Cir. 2013) ....................................................... 15 Ashcroft v. Iqbal, 556 U.S. 662 (2009) ................................................................................................ 20 Baldwin Metals Co. v. Donovan, 642 F.2d 768 (5th Cir. Unit A 1981) ........................................ 18, 19 Batterton v. Marshall, 648 F.2d 694 (D.C. Cir. 1980)......................................................................... 21 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) ................................................................................ 20 Bennett v. Spear, 520 U.S. 154 (1997)................................................................................................. 13 Block v. Cmty. Nutrition Inst., 467 U.S. 340 (1984) ............................................................................ 16 Caddell v. United States, No. 02-50473, 2003 WL 1107200 (5th Cir. Feb. 17, 2003) ......................... 3 Chao v. Occupational Safety & Health Review Comm’n, 540 F.3d 519 (6th Cir. 2008) ............................................................................................................... 18 Chrysler Corp. v. Brown, 441 U.S. 281 (1979) ................................................................................... 21 City of Los Angeles v. Lyons, 461 U.S. 95 (1983) ................................................................................. 8 Clapper v. Amnesty Int’l USA, 133 S. Ct. 1138 (2013) ................................................................. 6, 8, 9 Funk v. Stryker Corp., 631 F.3d 777 (5th Cir. 2011) ............................................................................. 3 General Motors Corp. v. Ruckelshaus, 742 F.2d 1561 (D.C. Cir. 1984) ............................................ 21 Hawk Aircargo, Inc. v. Chao, 418 F.3d 453 (5th Cir. 2005) ................................................................. 3 In re Establishment Inspection Manganas Painting Co., 104 F.3d 801 (6th Cir. 1997) ....................................................................................... 13, 15, 17, 18, 19 KVUE, Inc. v. Moore, 709 F.2d 922 (5th Cir. 1983) .............................................................................. 6 Louisiana Chem. Ass’n v. Bingham, 657 F.2d 777 (5th Cir. 1981) ..................................................... 17 Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992)..................................................................... 6, 8, 9 Luminant Generation Co. v. EPA, 757 F.3d 439 (5th Cir. 2014) ........................................................ 13 Manganas Painting Co. Inc., 21 BNA OSHC 2043 (Nos. 95-0101 & 95-0101, 2007) .......................... Marshall v. Barlow’s Inc., 436 U.S. 307 (1978) .................................................................................. 19 Martin v. OSHRC (CF & I Steel Corp.), 499 U.S. 144 (1991) ................................................ 17, 23, 25 Merchants Fast Motor Lines, Inc. v. I.C.C., 5 F.3d 911 (5th Cir. 1993) ................................. 10, 11, 13 Monk v. Huston, 340 F.3d 279 (5th Cir. 2003) .................................................................................... 11 Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139 (2010) ............................................................... 9 Nat’l Medical Enters., Inc. v. Shalala, 43 F.3d 90 (D.C. Cir. 1995) ................................................... 22 Nat’l Mining Ass’n v. Dep’t of Labor, 292 F.3d 849 (D.C. Cir. 2002) ................................................ 17 New Orleans Pub. Serv., Inc. v. Council of City of New Orleans, 833 F.2d 583 (5th Cir. 1987) ............................................................................................................... 10 Northeast Erectors Ass’n v. Sec’y of Labor, 62 F.3d 37 (1st Cir. 1995) ....................................... 17, 18 Ohio Forestry Ass’n, Inc. v. Sierra Club, 523 U.S. 726 (1998) ........................................................... 10 Peoples Nat’l Bank v. Office of the Comptroller of the Currency of the United States, 362 F.3d 333 (5th Cir. 2004). .............................................................................................................. 13 Perez v. Mortg. Bankers Ass’n, 135 S. Ct. 1199 (2015) ................................................................ 21, 23 Quershi v. Holder, 663 F.3d 778 (5th Cir. 2011)................................................................................. 14 Roark & Hardee LP v. Gardner, 522 F.3d 533 (5th Cir. 2008) .......................................................... 10 Sec’y of Labor v. LaForge & Budd Constr. Co., 16 BNA OSHC 2002 (No. 91-2264, 1994) ............................................................................................................................. 15 Sec’y of Labor v. Manganas, 70 F.3d 434 (6th Cir. 1995) ............................................................ 15, 18 Sec’y of Labor v. Ottman Custom Processors, Inc., 783 F.2d 8 (1st Cir. 1986). ................................. 19 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 5 of 32 PageID 89 v Shell Offshore Inc. v. Babbitt, 238 F.3d 622 (5th Cir. 2001) ............................................................... 21 Shields v. Norton, 289 F.3d 832 (5th Cir. 2002) .................................................................................. 10 Sturm, Ruger & Co. v. Chao, 300 F.3d 867 (D.C. Cir. 2002) ............................................ 15, 17, 18, 19 Suitum v. Tahoe Reg’l Planning Agency, 520 U.S. 725 (1997) ........................................................... 12 Syncor Int’l Corp. v. Shalala, 127 F.3d 90 (D.C. Cir. 1997) ............................................................... 21 Taylor-Callahan-Coleman Counties Dist. Adult Prob. Dept. v. Dole, 948 F.2d 953 (5th Cir. 1991) ....................................................................................... 12, 14, 15, 19, 20 Texas v. KVUE-TV, Inc., 465 U.S. 1092 (1984) .................................................................................... 6 Texas v. United States, 523 U.S. 296 (1998) ....................................................................................... 12 Texas v. United States, 787 F.3d 733 (5th Cir. 2015) ............................................................................ 9 Thomas v. Union Carbide Agric. Products Co., 473 U.S. 568 (1985) ................................................ 12 Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (1994) .............................................. 15, 16, 17, 18, 19 Toilet Goods Ass’n v. Gardner, 387 U.S. 158 (1967) .......................................................................... 12 United States v. Hays, 515 U.S. 737 (1995) .......................................................................................... 5 U.S. Army Corps of Engineers v. Hawkes Co., Inc., 136 S.Ct. 1807 (2016). ...................................... 13 United Techs. Corp. v. EPA, 821 F.2d 714 (D.C. Cir. 1987) ............................................................... 22 Wal-Mart Distribution Ctr. #6016 v. Occupational Safety & Health Review Comm’n, 819 F.3d 200 (5th Cir. 2016) ......................................................................................................... 23, 25 Warth v. Seldin, 422 U.S. 490 (1975) .................................................................................................. 10 Miscellaneous Congressional Record S. REP. NO. 91-1282, 91ST CONG., 2D SESS. (1970), reprinted in 1970 U.S.C.C.A.N. 5177 ..................................................................................... 24 Federal Register Notice 36 Fed. Reg. 17850 (Sept. 4, 1971) ........................................................................................... 2 Edwards, H. T., Elliott, L. A., & Levy, M. K., Federal Standards of Review (2nd ed. 2013). ............ 15 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 6 of 32 PageID 90 Defendants’ Brief in Support of Their Motion to Dismiss - Page 1 of 26 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION NATIONAL FEDERATION OF INDEPENDENT BUSINESS, Plaintiff, v. DOROTHY DOUGHERTY, in her official capacity as Deputy Assistant Secretary of Labor for the Occupational Safety and Health Administration, et al., Defendants. Civil Action No. 3:16-cv-02568-D DEFENDANTS’ BRIEF IN SUPPORT OF THEIR MOTION TO DISMISS I. Introduction Plaintiff National Federation of Independent Business (NFIB) brings this action against Dorothy Dougherty, in her official capacity as Deputy Assistant Secretary of Labor for the Occupational Safety and Health Administration (OSHA), OSHA, and Eric Harbin, in his official capacity as Regional Administrator for OSHA Region 6,1 challenging a letter OSHA issued in February 2013 (2013 Letter) explaining certain regulations and policies related to health and safety inspections. NFIB alleges that OSHA’s 2013 Letter “substantially lowers the standard” for when a non-employee may accompany an OSHA compliance officer on an inspection of a worksite. Compl. ¶ 22. NFIB seeks a declaration that OSHA’s Letter violates the Administrative Procedure Act (APA) and the Occupational Safety and Health Act (OSH Act), and an injunction prohibiting enforcement of the 2013 Letter. Compl. at 14, ¶¶ 1-3. As explained below, the Court should dismiss this lawsuit for lack of subject-matter jurisdiction and failure to state a claim upon which relief can be granted under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). 1 In this brief, the defendants will be referred to collectively as “OSHA.” Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 7 of 32 PageID 91 Defendants’ Brief in Support of Their Motion to Dismiss - Page 2 of 26 II. Background A. OSHA Inspections of Employer Worksites Under the OSH Act The OSH Act authorizes the Secretary of Labor to promulgate workplace safety and health standards, 29 U.S.C. § 655(b), as well as other regulations “necessary or appropriate for the enforcement of [the Act].” 29 U.S.C. § 657(c)(1). The Secretary of Labor, through OSHA, conducts workplace inspections to ensure compliance with the requirements of the OSH Act and implementing regulations. Id. § 657(a). Section 8(a) of the OSH Act provides that inspections must take place at reasonable times, within reasonable limits, and in a reasonable manner, and that the inspections may include the private questioning of employers, owners, operators, agents, and employees. Id. § 657(a)(2). In addition, and “[s]ubject to regulations issued by the Secretary, a representative of the employer and a representative authorized by his employees shall be given an opportunity to accompany [OSHA] … during the physical inspection of any workplace … for the purpose of aiding such inspection.” Id. § 657(e). OSHA promulgated regulations governing the conduct of OSHA inspections in 1971. See 29 C.F.R. Part 1903; 36 Fed. Reg. 17850 (Sept. 4, 1971). These regulations grant OSHA compliance officers broad authority to conduct safety and health inspections at worksites. See 29 C.F.R. §§ 1903.3, 1903.7. Compliance officers have the authority to take environmental samples, photographs, and interview any employer, owner, operator, agent, or employee of an establishment. Id. § 1903.7(b). Compliance officers are in charge of inspections and the questioning of any person, but a representative of the employer and a representative authorized by employees may accompany the compliance officer during the physical inspection of the workplace for the purpose of aiding the inspection. Id. § 1903.8(a). A compliance officer may permit additional employer and employee representatives if he or she determines it will aid the inspection. Id. If there is no authorized representative of the employees, or if the compliance officer is unable to determine with reasonable certainty who is the representative, OSHA’s regulations instruct Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 8 of 32 PageID 92 Defendants’ Brief in Support of Their Motion to Dismiss - Page 3 of 26 the compliance officer to consult with a reasonable number of employees concerning safety and health matters. Id. § 1903.8(b). In general, the representative(s) authorized by employees shall be an employee of the employer. Id. § 1903.8(c). However, “if in the judgment of the Compliance Safety and Health Officer, good cause has been shown why accompaniment by a third party who is not an employee of the employer (such as an industrial hygienist or a safety engineer) is reasonably necessary to the conduct of an effective and thorough physical inspection of the workplace, such third party may accompany the Compliance Safety and Health Officer during the inspection.” Id. OSHA’s regulations further instruct compliance officers to terminate an inspection and inform their supervisor if an employer refuses to allow an employee representative to accompany the compliance officer during the inspection. Id. § 1903.4(a). OSHA is authorized to take legal action, i.e., an application for an inspection warrant or its equivalent, to obtain access. Id. § 1903.4(d). Additional guidance for the conduct of inspections is found in OSHA’s Field Operations Manual (FOM),2 other OSHA compliance directives, and internal memoranda. B. The 2013 Letter In February 2013, OSHA sent the 2013 Letter in response to an inquiry from Mr. Steve Sallman, a Health and Safety Specialist for the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union (USW), regarding whether workers at a workplace without a collective bargaining agreement may authorize a person affiliated with a union or community organization to act as their representative. OSHA responded in the 2013 Letter that, consistent with the policy articulated in its FOM, an employee representative 2 The Court may consider OSHA’s FOM, which is publicly available on OSHA’s website (https://www.osha.gov/OshDoc/Directive_pdf/CPL_02-00-160.pdf (last visited Oct. 31, 2016)), without converting this motion to dismiss into a motion for summary judgment because the FOM is subject to judicial notice. See Funk v. Stryker Corp., 631 F.3d 777, 783 (5th Cir. 2011); Hawk Aircargo, Inc. v. Chao, 418 F.3d 453, 457 (5th Cir. 2005). In addition, matters outside the pleadings may be considered when deciding a Rule 12(b)(1) motion without triggering an obligation to convert it into a motion for summary judgment. Caddell v. United States, No. 02-50473, 2003 WL 1107200, at *1 (5th Cir. Feb. 17, 2003). Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 9 of 32 PageID 93 Defendants’ Brief in Support of Their Motion to Dismiss - Page 4 of 26 “may include any person acting in a bona fide representative capacity, including nonprofit groups or organizations (FOM Chapter 9, I.A).” 2013 Letter at 1. Mr. Sallman also asked whether a representative affiliated with a union or community organization could act on workers’ behalves as a walkaround representative during an OSHA inspection. 2013 Letter at 2. Consistent with section 8(e) of the OSH Act and the implementing regulations at 29 C.F.R. §§ 1903.8(a)-(d), OSHA replied that there may be times when the presence of an employee representative who is not employed by the employer will allow a more effective inspection. 2013 Letter at 2-3. OSHA explained that “representatives are ‘reasonably necessary’ when they will make a positive contribution to a thorough and effective inspection.” Id. at 2 (referencing 29 C.F.R. § 1903.8(c)). OSHA noted that this determination may be related to a representative’s experience and skill, such as where a representative has experience evaluating similar working conditions in a different plant. Id. at 3. Additionally, non-English speaking workers may want a representative who is fluent in both their own language and English, which would facilitate more useful interactions with the compliance officer during the inspection. Id. OSHA also noted that workers in some situations may feel uncomfortable talking to a compliance officer without the trusted presence of a representative of their choosing. Id. C. NFIB’s Complaint Almost three years after nonemployee representatives accompanied an OSHA compliance officer on four inspections of one NFIB member’s worksites, NFIB filed its complaint with the Court. The NFIB member, Professional Janitorial Service (PJS), believes that, based on its prior inspections in 2013 and 2014 and an ongoing labor dispute with a union, it will again be required to allow nonemployee union representatives onto its worksites. Compl. ¶ 30. PJS does not want to allow access to union third-party representatives, but fears “substantial civil penalties and practical business injuries” if it denies access to OSHA and a third-party representative. Compl. ¶ 34. Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 10 of 32 PageID 94 Defendants’ Brief in Support of Their Motion to Dismiss - Page 5 of 26 According to NFIB, OSHA’s 2013 Letter should be set aside because it amended OSHA’s inspection regulation at § 1903.8 without notice-and-comment rulemaking under the APA, and because it is contrary to the OSH Act. Compl. ¶¶ 47, 54, 59. NFIB alleges that the 2013 Letter amends § 1903.8 because it “creates an exception to Section 1903.8’s categorical rule that the employee representative also must be an employee.” Compl. ¶ 45. In addition, NFIB states that the 2013 Letter “makes a material change in the standard for determining whether a nonemployee may accompany the compliance officer” from “reasonably necessary” to “will make a positive contribution.” Compl. ¶ 46. NFIB requests that this Court enjoin OSHA from enforcing the 2013 Letter. Compl. at 14. III. Argument The Court should dismiss NFIB’s claims under Federal Rule of Civil Procedure 12(b)(1) for lack of subject-matter jurisdiction and under Rule 12(b)(6) for failure to state a claim upon which relief can be granted. The Court lacks subject-matter jurisdiction because NFIB lacks standing, its claims are not ripe for review, and there is no final agency action to be reviewed. Additionally, the OSH Act’s detailed administrative and judicial review scheme precludes district court jurisdiction in this case, and NFIB has an adequate legal remedy other than declaratory and injunctive relief. Moreover, NFIB has failed to state a claim upon which relief can be granted because the 2013 Letter is an interpretive statement exempt from notice-and-comment rulemaking and because the 2013 Letter is consistent with both the OSH Act and OSHA’s inspection regulations. A. The Court Lacks Subject-Matter Jurisdiction to Consider NFIB’s Challenges to OSHA’s 2013 Letter. Under Rule 12(b)(1), a plaintiff seeking to invoke the jurisdiction of a federal court bears the burden of establishing that the court has jurisdiction to hear its claim. United States v. Hays, 515 U.S. 737, 743 (1995); Alfonso v. United States, 752 F.3d 622, 625 (5th Cir. 2014). Because the elements necessary to establish jurisdiction are “not mere pleading requirements but rather an indispensable Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 11 of 32 PageID 95 Defendants’ Brief in Support of Their Motion to Dismiss - Page 6 of 26 part of the plaintiff’s case, each element must be supported in the same way as any other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). NFIB has failed to meet its burden. 1. NFIB Lacks Standing to Bring This Action. The Court lacks subject-matter jurisdiction and NFIB’s suit fails because, in the absence of any concrete and actual or imminent injury resulting from OSHA’s 2013 Letter, it cannot establish standing. For Article III standing to exist, NFIB must demonstrate that it: (1) has suffered an injury in fact; (2) the injury has a causal connection to the defendant’s conduct; and (3) it must be likely, and not merely speculative, that the injury suffered will be redressed by a decision favorable to the plaintiff. Lujan, 504 U.S. at 560-61. NFIB cannot establish any of these three elements. a. NFIB Has Suffered No Injury. To constitute an “injury in fact,” the injury must be “an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.” Id. at 560 (citations omitted). An allegation of future injury must be “certainly impending to constitute injury in fact,” or there is a “substantial risk” that the harm will occur; “‘[a]llegations of possible future injury’ are not sufficient.” Clapper v. Amnesty Int’l USA, 133 S. Ct. 1138, 1147, 1150 n.5 (2013) (citations omitted); see also KVUE, Inc. v. Moore, 709 F.2d 922, 928 (5th Cir. 1983), aff’d sub nom. Texas v. KVUE-TV, Inc., 465 U.S. 1092 (1984) (litigant “must demonstrate a realistic danger of sustaining a direct injury as a result of the statute’s operation or enforcement”). Although NFIB alleges that one member company, PJS, had four workplaces inspected between October 2013 and February 2014 where an OSHA compliance officer was accompanied by non-employee representatives from a union, NFIB does not allege that PJS suffered an injury from the presence of those non-employee representatives. Compl. ¶¶ 25-30. Rather, NFIB alleges that Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 12 of 32 PageID 96 Defendants’ Brief in Support of Their Motion to Dismiss - Page 7 of 26 PJS’s injury is the potential risk that it may, sometime in the future, suffer “substantial civil penalties and practical business injuries” if it refuses to permit non-employee representatives to accompany an OSHA compliance officer during an inspection. Compl. ¶ 34. NFIB alleges that, based on PJS’s prior inspections, coupled with an ongoing labor dispute with a union, it will again be required, against its will, to allow non-employee union representatives onto its worksites. Compl. ¶ 30. NFIB’s fear that its members will suffer unspecified civil penalties if they refuse to grant access to OSHA and a non-employee representative is baseless. While OSHA may obtain a court- ordered warrant in such a circumstance, there is nothing in the OSH Act that grants OSHA the authority to issue citations or penalties to an employer if an employer refuses to grant OSHA access to its worksite for the purpose of an inspection. See generally 29 U.S.C. § 666. Indeed, while PJS has had four worksites inspected where the compliance officer was accompanied by non-employee representatives, it does not allege that it was threatened with civil penalties or business injuries if it refused to grant access to OSHA and the non-employee representative. Additionally, not only does NFIB not provide any explanation of what is meant by the nebulous phrase “practical business injuries,” Compl. ¶ 34, there is nothing in the complaint to indicate that NFIB or its members would suffer them. Instead, if PJS refused to allow access to an OSHA compliance officer and a non-employee representative, OSHA’s regulations instruct the compliance officer to terminate the inspection – not to issue penalties. 29 C.F.R. § 1903.4(a). Upon terminating an inspection, OSHA’s compliance officer must report the refusal to the Area Director, who shall consult with the Regional Solicitor, and determine whether compulsory process (i.e., a warrant) is necessary. Id. NFIB’s speculative claim of injury therefore depends on a series of hypothetical, attenuated events: (1) OSHA inspects a PJS or other NFIB-member worksite with no employee representatives, and OSHA determines that a non-employee representative is reasonably necessary, i.e., would positively contribute, to the inspection; (2) the NFIB member objects to the presence of the non- Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 13 of 32 PageID 97 Defendants’ Brief in Support of Their Motion to Dismiss - Page 8 of 26 employee representative; (3) rather than following the OSHA regulations and terminating the inspection upon the employer’s objection, the OSHA compliance officer somehow continues with the inspection against the employer’s will; and (4) OSHA issues citations and penalties to the employer unrelated to health and safety violations at the worksite in retaliation for the employer’s objection. The “injury” to NFIB in this series of events occurs only if an OSHA compliance officer fails to follow OSHA’s inspection regulation at §1903.4, and is far too speculative to demonstrate that NFIB will suffer an injury in the future. See City of Los Angeles v. Lyons, 461 U.S. 95, 102-03 (1983) (no standing where prospect of future injury rested on the likelihood that plaintiff would again be stopped by the police who would illegally choke him). An alternative hypothetical series of events – in which the compliance officer follows OSHA’s regulations and terminates the inspection upon the employer’s objection, but this somehow results in harm to the employer – is even more speculative. In this scenario, (1) OSHA inspects a PJS or NFIB-member worksite with no employee representatives, and OSHA determines that a non- employee representative is reasonably necessary, i.e., would positively contribute, to the inspection; (2) the NFIB member objects to the presence of the non-employee representative; (3) the compliance officer terminates the inspection and reports it to the OSHA Area Director; (4) the Area Director consults with the Regional Solicitor of the Department of Labor; (5) the Regional Solicitor seeks a warrant for OSHA’s access to the employer’s worksite; (6) a federal district court issues the warrant; (7) the employer files a motion to quash the warrant; (8) the court denies the motion to quash; (9) OSHA inspects the employer’s worksite; and (10) OSHA issues citations and penalties to the employer based on workplace health and safety violations discovered due to the involvement of the representative. This scenario likewise illustrates the purely hypothetical nature of NFIB’s claim of injury. Far from being “imminent” or “certainly impending,” NFIB’s claim of injury is purely speculative. See Lujan, 504 U.S. at 560; Clapper, 133 S. Ct. at 1147, 1150 n.5. Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 14 of 32 PageID 98 Defendants’ Brief in Support of Their Motion to Dismiss - Page 9 of 26 b. No Causal Connection Exists Between Any Injury and the Challenged Action. Moreover, NFIB cannot establish the second element needed to establish standing: that the injury is “fairly traceable to the challenged action.” Clapper, 133 S.Ct. at 1147 (citations omitted). Even if there were an injury related to NFIB’s potential inability to exclude participation by a non- employee representative during an OSHA inspection, the injury would not be “fairly traceable” to the 2013 Letter. A compliance officer’s authority to bring a non-employee representative to a workplace inspection stems not from the 2013 Letter, but from OSHA’s 45-year old inspection regulation and from the OSH Act.3 OSHA’s regulations explicitly permit OSHA to have a third party accompany a compliance officer when a compliance officer determines it is “reasonably necessary to the conduct of an effective and thorough physical inspection of the workplace.” 29 C.F.R. § 1903.8(c). c. A Favorable Judgment Would Not Redress Any Injury. For similar reasons, NFIB cannot establish the third element for standing, which requires that the injury be “redressable by a favorable ruling.” Clapper, 133 S. Ct. at 1147 (quoting Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139, 149 (2010)); Texas v. United States, 787 F.3d 733, 747-48 (5th Cir. 2015). Here, because what NFIB challenges is not truly the 2013 Letter, but OSHA’s inspection regulation, a favorable judgment is not likely to redress the injury. Even if this Court were to enjoin OSHA from “enforcing” the 2013 Letter (Compl. at 14, ¶ 3), OSHA’s inspection regulation at §1903.8(c) explicitly permits OSHA to bring a third-party representative to a workplace inspection – which is precisely what NFIB seeks to prevent. Accordingly, NFIB cannot establish any of the three elements needed to demonstrate standing. See Lujan, 504 U.S. at 560. 3 NFIB’s argument that the 2013 Letter “substantially lowers the standard” for determining whether a third party may accompany a compliance officer, Compl. ¶ 22, is also unfounded, as will be discussed. Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 15 of 32 PageID 99 Defendants’ Brief in Support of Their Motion to Dismiss - Page 10 of 26 2. NFIB’s Lawsuit Is Not Ripe for Judicial Review. For similar reasons, NFIB’s case is not ripe for review. See Warth v. Seldin, 422 U.S. 490, 499 n.10 (1975) (noting that “[t]he standing question . . . bears close affinity to questions of ripeness—whether the harm asserted has matured sufficiently to warrant judicial intervention”). The ripeness doctrine is designed “to prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements over administrative policies, and also to protect the agencies from judicial interference until an administrative decision has been formalized and its effects felt in a concrete way by the challenging parties.” Ohio Forestry Ass’n, Inc. v. Sierra Club, 523 U.S. 726, 732-33 (1998) (quoting Abbott Labs. v. Gardner, 387 U.S. 136, 148-49 (1967)). A “ripeness inquiry is often required when a party is seeking pre-enforcement review of a law or regulation.” Roark & Hardee LP v. City of Austin, 522 F.3d 533, 544 (5th Cir. 2008) (emphasis in original). In evaluating ripeness, the courts evaluate “both the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration.” Abbott Labs., 387 U.S. at 149. The Fifth Circuit applies a four-part test when determining ripeness in a case brought under the APA: (1) whether the issues presented are purely legal; (2) whether the challenged agency action is a “final agency action” within the meaning of the APA; (3) whether the challenged action has or will have a direct and immediate impact on the petitioner; and (4) whether resolution of the issues will foster effective enforcement and administration by the agency. Merchants Fast Motor Lines, Inc. v. I.C.C., 5 F.3d 911, 920 (5th Cir. 1993). NFIB fails on all counts to prove that this matter is ripe for review. See Shields v. Norton, 289 F.3d 832, 835 (5th Cir. 2002) (party seeking review must demonstrate that the action is ripe). a. The Issues Are Not Purely Legal. While a case is generally ripe if the issues are purely legal, a case is not ripe if further factual development is required. New Orleans Pub. Serv., Inc. v. Council of City of New Orleans, 833 F.2d Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 16 of 32 PageID 100 Defendants’ Brief in Support of Their Motion to Dismiss - Page 11 of 26 583, 587 (5th Cir. 1987). “A court should dismiss a case for lack of ‘ripeness’ when the case is abstract or hypothetical.” Monk v. Huston, 340 F.3d 279, 282 (5th Cir. 2003). Here, the issues are abstract, hypothetical, and fact-dependent. The question of whether a third-party representative may accompany an OSHA compliance officer on an inspection depends on whether the representative’s presence is “reasonably necessary” because he or she will make a positive contribution. See 29 C.F.R. § 1903.8(c); 2013 Letter. This is necessarily a fact-specific inquiry. Whether the representative’s presence is reasonably necessary (or whether there is any perceptible difference between that determination and one that the representative would make a “positive contribution”) will depend on the particular worksite, the worker population, the machinery or equipment in the facility, the compliance officer’s expertise, and the third party’s skill, experience, and qualifications. Notably, NFIB seems to object to the 2013 Letter only to the extent that it would permit a non-employee representative from a union from accompanying the compliance officer – further revealing the fact-dependent nature to NFIB’s claim. See Compl. ¶ 34 (“PJS does not wish to allow access to Union third-parties…”). And, as explained above, NFIB’s asserted harm depends on a series of hypothetical, attenuated events. b. The 2013 Letter is Not a Final Agency Action. Second, and as discussed in more detail below, OSHA’s 2013 Letter is not a final agency action within the meaning of the APA. c. The 2013 Letter Has No Direct or Immediate Impact on NFIB. Third, the 2013 Letter has no direct, immediate impact on NFIB. This aspect of the ripeness doctrine overlaps significantly with the requirement for a final agency action, and ensures that agencies are protected from judicial review until the effects of their action are felt in a “concrete way” by the challenging parties. Merchants Fast Motor Lines, 5 F.3d at 920. Here, the 2013 Letter explains that OSHA would consider a third party representative “reasonably necessary” to the conduct of an effective and thorough workplace investigation when the Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 17 of 32 PageID 101 Defendants’ Brief in Support of Their Motion to Dismiss - Page 12 of 26 third party would make a “positive contribution.” NFIB need not change any behavior as a result of the 2013 Letter. See Taylor-Callahan-Coleman Counties Dist. Adult Prob. Dep’t v. Dole, 948 F.2d 953, 959 (5th Cir. 1991) (finding no direct and immediate impact on employers under the FLSA because they were free to continue treating their employees in the way they believed was correct despite agency opinion letters). Any impact on NFIB depends, as explained above, on hypothetical events in the future. But a claim that rests upon “contingent future events that may not occur as anticipated, or indeed may not occur at all” is not ripe for review. Texas v. United States, 523 U.S. 296, 300 (1998) (quoting Thomas v. Union Carbide Agric. Products Co., 473 U.S. 568, 580-81 (1985)). Furthermore, NFIB would not suffer any hardship if this Court denied review. “[W]here a regulation requires an immediate and significant change in the plaintiffs’ conduct of their affairs with serious penalties attached to noncompliance, hardship has been demonstrated.” Suitum v. Tahoe Reg’l Planning Agency, 520 U.S. 725, 743-44 (1997) (citing Abbott Labs., 387 U.S. at 153). This is hardly the case here. NFIB members need not change any behavior. Just as they always could, NFIB members can object to the presence of an OSHA compliance officer on their worksites (with or without a third-party representative), require OSHA to get a warrant, and make any arguments in their motions to quash the warrant that they would before this Court. Further, NFIB (or a member employer) suffers no penalties for objecting to OSHA’s presence. See Toilet Goods Ass’n v. Gardner, 387 U.S. 158, 164-65 (1967) (finding minimal present harm to denying review where the challenged regulation required no advance action on the part of petitioners and no irremediable adverse consequences, such as “heavy fines,” “adverse publicity,” or “possible criminal liability”). d. The Suit Does Not Foster Effective Agency Enforcement and Administration. Finally, resolution of the issues by this Court will not foster effective enforcement and administration by OSHA. To the contrary, allowing NFIB’s suit interferes with enforcement of the OSH Act because it interrupts OSHA’s inspection and enforcement procedures. And, as explained Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 18 of 32 PageID 102 Defendants’ Brief in Support of Their Motion to Dismiss - Page 13 of 26 above, an employer always has the right to object to a compliance officer’s inspection, require OSHA to get a warrant, file a motion to quash the warrant, and, if citations are issued, seek to have evidence suppressed. See In re Establishment Inspection of Manganas Painting Co., 104 F.3d 801, 803 (6th Cir. 1997). Accordingly, NFIB cannot demonstrate that its claim is ripe for review. Merchants Fast Motor Lines, 5 F.3d at 920. 3. NFIB Cannot Bring Suit Under the APA Because It Does Not Challenge a Final Agency Action. NFIB’s APA claim also fails because it does not challenge a “final agency action.” 5 U.S.C. § 704. If there is no “final agency action,” this Court lacks jurisdiction. See Peoples Nat’l Bank v. Office of the Comptroller of the Currency of the United States, 362 F.3d 333, 336 (5th Cir. 2004). Section 704 of the APA limits judicial review to “[a]gency action made reviewable by statute and [to] final agency action for which there is no other adequate remedy in a court....” Id. To be final, an agency action must satisfy two requirements: (1) the decision must “mark the ‘consummation’ of the agency’s decisionmaking process,” and (2) “the action must be one by which ‘rights or obligations have been determined,’ or from which ‘legal consequences will flow.’” Bennett v. Spear, 520 U.S. 154, 177-78 (1997).4 OSHA’s 2013 Letter meets neither of these two requirements. First, the 2013 Letter does not mark the “consummation” of OSHA’s decisionmaking process. It does not commit OSHA to any particular course of action, nor does it end OSHA’s decisionmaking. OSHA must still determine in any given situation whether a third-party representative is reasonably necessary, i.e., will make a positive contribution to a thorough and effective inspection. Additionally, OSHA could choose to withdraw or amend the 2013 Letter at any time. See Luminant Generation Co. v. EPA, 757 F.3d 439, 442 (5th Cir. 2014) (EPA’s Notice of Violation not a final agency action as EPA could still issue an order, administrative penalty, bring a 4 The Supreme Court has more recently examined what constitutes a final agency action, in U.S. Army Corps of Engineers v. Hawkes Co., Inc., 136 S.Ct. 1807 (2016). The analysis in that case is not relevant to the circumstances here, however. Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 19 of 32 PageID 103 Defendants’ Brief in Support of Their Motion to Dismiss - Page 14 of 26 civil action, or withdraw or amend the notice); Qureshi v. Holder, 663 F.3d 778, 781 (5th Cir. 2011) (termination of asylum not the “consummation” of agency decisionmaking because it was only an intermediate step in a multi-stage administrative process). Second, no obligations or legal consequences flow from the 2013 Letter. As explained, NFIB’s members need not change any behavior as a result of the Letter. The Letter does not state that third-party representatives will always be permitted during an OSHA inspection. Even if a compliance officer determines that a third-party representative would positively contribute to an inspection, an employer can refuse OSHA and the third party access to its worksite without facing any consequences beyond those already provided in the OSH Act and OSHA’s regulations. See Taylor-Callahan-Coleman, 948 F.2d at 957-59 (5th Cir. 1991) (DOL advisory opinion letters not final agency actions because they did not set out any definitive statement of DOL policy, did not have status of law with penalties for noncompliance, and were neither final nor binding on employers or employees). NFIB’s assertion that the 2013 Letter “creates an exception to Section 1903.8’s categorical rule that the employee representative also must be an employee,” Compl. ¶ 45, is incorrect: § 1903.8(c) itself creates that exception. And contrary to NFIB’s claim that under § 1903.8(c), a third party “must have some specialized knowledge directly germane to the inspection,” (Compl. ¶ 46) paragraph (c) does not require “specialized knowledge.” Rather, the test is whether the third party is “reasonably necessary to the conduct of an effective and thorough physical inspection of the workplace;” examples are given of an industrial hygienist or safety engineer. 29 C.F.R. § 1903.8(c). In other words, legal consequences flow not from the 2013 Letter, but from § 1903.8(c). See Taylor- Callahan-Coleman, 948 F.2d at 958 (no final agency action where the regulations, not the opinion letters, fix rights). Finally, the 2013 Letter itself is clear that it is an interpretative letter that does not create new or additional requirements, but rather explains the requirements set by statute and regulations. 2013 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 20 of 32 PageID 104 Defendants’ Brief in Support of Their Motion to Dismiss - Page 15 of 26 Letter at 3. “[I]nterpretive rules or statements of policy generally do not qualify [as final agency action] because they are not ‘finally determinative of the issues or rights to which they are addressed.’” Am. Tort Reform Ass’n v. OSHA, 738 F.3d 387, 395 (D.C. Cir. 2013) (quoting Edwards, Elliott & Levy, Federal Standards of Review 157 (2d ed. 2013)); see also id. (“Like agency policy statements, interpretive rules that do not establish a binding norm are not subject to judicial review under the APA.” (quoting Edwards, Elliott & Levy, Federal Standards of Review at 161)). OSHA maintains on its public website hundreds of letters of interpretation, which can be withdrawn or amended, responding to inquiries about OSHA requirements.5 Courts and the Occupational Safety and Health Review Commission have agreed that OSHA’s guidance manuals like the FOM and interpretative letters do not have the force and effect of law. See, e.g., American Tort Reform Ass’n v. Occupational Safety & Health Admin., 738 F.3d 387, 394 (D.C. Cir. 2013); Sec’y of Labor v. Manganas, 70 F.3d 434, 437 (6th Cir. 1995); Sec’y of Labor v. LaForge & Budd Constr. Co., 16 BNA OSHC 2002, 2006 n.6 (No. 91-2264, 1994). The 2013 Letter is therefore not a final agency action subject to judicial review. Taylor-Callahan-Coleman, 948 F.2d at 957-59. 4. The OSH Act Precludes this Court’s Pre-Enforcement Review of an OSHA Interpretive Letter. This Court also lacks jurisdiction to review NFIB’s claims because the OSH Act’s detailed administrative and judicial review scheme precludes this Court’s jurisdiction over NFIB’s pre- enforcement challenge to OSHA’s interpretation of its inspection regulation. See Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (1994); see also Sturm, Ruger & Co. v. Chao, 300 F.3d 867, 872 (D.C. Cir. 2002); Manganas Painting, 104 F.3d at 802. In Thunder Basin, a mine operator filed a pre-enforcement action challenging the Mine Safety and Health Administration’s (MSHA) interpretation of its regulation that required the mine to post information about its employees’ 5 See https://www.osha.gov/pls/oshaweb/owasrch.search_form?p_doc_type=INTERPRETATIONS&p_toc_lev el=0 (last visited Nov. 8, 2016). Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 21 of 32 PageID 105 Defendants’ Brief in Support of Their Motion to Dismiss - Page 16 of 26 designated representatives. 510 U.S. at 204-05. The mine operator objected to the two non- employee representatives from the United Mine Workers of America selected by its employees. Id. at 204. The operator sought an injunction in district court against enforcement of the regulation, arguing that designation of non-employee union representatives violated its rights under the National Labor Relations Act. Id. at 205. The operator also argued that requiring it to challenge MSHA’s interpretation of the statute and regulation through the Mine Act’s statutory review process would violate the Due Process Clause of the Fifth Amendment, because it would force the operator to choose between violating the Act and incurring penalties, or complying and thereby suffering irreparable harm. Id. The Supreme Court determined that the district court lacked subject-matter jurisdiction over the operator’s pre-enforcement challenge, holding that “[i]n cases involving delayed judicial review of final agency actions, we shall find that Congress has allocated initial review to an administrative body where such intent is ‘fairly discernible in the statutory scheme.’” Id. at 207 (quoting Block v. Cmty. Nutrition Inst., 467 U.S. 340, 351 (1984)). The Court explained that the operator’s “claims turn[ed] on a question of statutory interpretation that [could] be meaningfully reviewed under the Mine Act,” and there was no indication that “Congress intended to allow mine operators to evade the statutory-review process [established in the Act] by enjoining the Secretary from commencing enforcement proceedings.” Id. at 216. The mine operator could seek review of a citation, once it was issued, before the Federal Mine Safety and Health Review Commission, an independent administrative body. Id. at 214-15. The Supreme Court specifically noted that “[t]o uphold the District Court’s jurisdiction in these circumstances would be inimical to the structure and the purposes of the Mine Act.” Id. at 216. The Thunder Basin analysis of review under the Mine Act is equally applicable to the OSH Act. The comprehensive administrative and judicial review procedures in the OSH Act are “nearly Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 22 of 32 PageID 106 Defendants’ Brief in Support of Their Motion to Dismiss - Page 17 of 26 identical” to those in the Mine Act.6 Manganas Painting, 104 F.3d at 803; see also Sturm, Ruger & Co., 300 F.3d at 872-73 (noting that the Mine Act’s review process was written to conform to the OSH Act’s review process). Thus, courts have consistently held that, based on Thunder Basin, district courts lack jurisdiction over pre-enforcement OSHA actions. Sturm, Ruger & Co., 300 F.3d at 872 (administrative review process established under the OSH Act is the exclusive means for employer to challenge OSHA’s data collection initiative); Manganas Painting, 104 F.3d at 802 (rejecting employer’s attempt to enjoin OSHA from further inspection activity until Commission rendered a decision on previously issued citations); Northeast Erectors Ass’n v. Sec’y of Labor, 62 F.3d 37, 40 (1st Cir. 1995) (rejecting association’s estoppel-based suit to enforce a regional OSHA agreement not to cite). The OSH Act expressly authorizes original actions in district court in only a few situations, none of which include pre-enforcement actions by employers.7 See 29 U.S.C. § 657(b) (actions by the Secretary to enforce administrative subpoenas); id. at § 660(c)(2) (actions by Secretary to enforce the antidiscrimination provision of the OSH Act); id. at § 662(a), (d) (actions on behalf of Secretary to restrain imminent dangers); and id. at § 666(l) (actions to recover civil penalties). The administrative review process is generally the exclusive procedure through which an employer can 6 While OSHA enforces the OSH Act, an independent agency, the Occupational Safety and Health Review Commission (Commission), carries out the adjudicatory functions. 29 U.S.C. § 651(b)(3); see Martin v. OSHRC, 499 U.S. 144, 147 (1991) (explaining that the OSH Act “assigns distinct regulatory tasks to two different administrative actors”). Under the OSH Act, employers may contest OSHA citations before the Commission. 29 U.S.C. § 659(c). Contests are heard first by an administrative law judge, whose decision becomes the final order of the Commission unless the Commission reviews the case. Id. at § 661(j). Both employers and the Secretary may seek review of Commission orders in the courts of appeals. Id. at § 660(a), (b). 7 Under the APA, district courts have jurisdiction to review a challenge “on the validity of ‘a formal regulation’ issued pursuant to ‘notice-and-comment’ rulemaking.” Sturm, Ruger & Co., 300 F.3d at 875 (quoting Nat’l Mining Ass’n v. Dep’t of Labor, 292 F.3d 849, 858 (D.C. Cir. 2002)); see also 5 U.S.C. § 703; Louisiana Chem. Ass’n v. Bingham, 657 F.2d 777, 778 (5th Cir. 1981). Here, as in Sturm, Ruger & Co., NFIB’s lawsuit is not a challenge to the validity of a formal regulation issued pursuant to notice- and-comment rulemaking, and NFIB can challenge OSHA’s interpretation of its inspection regulation in an enforcement proceeding. 300 F.3d at 875-76. Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 23 of 32 PageID 107 Defendants’ Brief in Support of Their Motion to Dismiss - Page 18 of 26 obtain review of OSHA enforcement actions. See 29 U.S.C. § 660(a); Manganas Painting, 104 F.3d at 802; Northeast Erectors, 62 F.3d at 39-40 (concluding employer could raise estoppel-based claim as defense during challenge to citation in ordinary administrative review procedure). District courts can still assert jurisdiction over “claims considered wholly collateral to a statute’s review provisions and outside the agency’s expertise,” especially “where a finding of preclusion could foreclose all meaningful judicial review.” Thunder Basin, 510 U.S. at 212-13. NFIB’s claims, however, do not fall within those limited exceptions. NFIB’s action challenges the way OSHA conducts its inspections during an enforcement action, and hinges on the way OSHA interprets an inspection regulation. Far from being collateral to the OSH Act’s review provisions, assessing OSHA’s regulations “falls squarely with the Commission’s expertise.” Sturm, Ruger & Co., 300 F.3d at 874 (employer’s argument that OSHA’s data collection program exceeded agency’s statutory and regulatory authority required statutory and regulatory interpretation that could be addressed by the Commission). Moreover, barring district court review in this case will not deprive NFIB of the opportunity to obtain judicial review. In fact, NFIB has not one, but two ways to challenge an inspection with a third-party representative. If NFIB is subjected to an inspection with a third-party representative, NFIB could refuse to grant the OSHA compliance officer and third-party representative access to its worksite and, if OSHA obtains a warrant, can move to quash that motion. Baldwin Metals Co. v. Donovan, 642 F.2d 768, 771-77 (5th Cir. Unit A 1981) (employer can challenge a warrant by filing a motion to quash). And, as the Sixth Circuit noted in Manganas Painting, if any citations are issued, NFIB can seek administrative review and move to suppress any evidence obtained during the inspection. Manganas Painting, 104 F.3d at 803; Sec’y of Labor v. Manganas Painting Co., Inc., 21 BNA OSHC 2043, 2047 (Nos. 95-0103 & 95-0104, 2007) (in administrative proceeding, reviewing whether warrant and inspection conformed with the Fourth Amendment standards of probable cause and reasonableness), rev’d in part on other grounds sub nom. Chao v. Occupational Safety & Health Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 24 of 32 PageID 108 Defendants’ Brief in Support of Their Motion to Dismiss - Page 19 of 26 Review Comm’n, 540 F.3d 519 (6th Cir. 2008). Accordingly, this Court lacks jurisdiction over NFIB’s pre-enforcement challenge to OSHA’s interpretation of its inspection regulation and the OSH Act. Thunder Basin, 510 U.S. at 207; Sturm, Ruger & Co., 300 F.3d at 872; Manganas Painting, 104 F.3d at 802. 5. NFIB Cannot Bring this Suit Because It Has an Adequate Legal Remedy. NFIB’s APA claim also fails because it has an adequate remedy in a court, which is simply to object to the presence of the third-party representative, require OSHA to obtain a warrant, and, if issued, file a motion to quash the warrant.8 5 U.S.C. § 704 (judicial review under the APA limited to “final agency action for which there is no other adequate remedy in a court”); see also Taylor- Callahan-Coleman, 948 F.2d at 956, 959 (employer had adequate remedy besides declaratory judgment because it could defend itself in an enforcement action). NFIB has a number of adequate legal remedies available other than declaratory relief. Because the Fourth Amendment applies to OSHA inspections, unless an employer consents to an inspection or another Fourth Amendment exception applies, OSHA must obtain a warrant to inspect an employer’s worksite. Marshall v. Barlow’s Inc., 436 U.S. 307, 324 (1978). An employer can challenge the warrant by filing a motion to quash, and, if the motion is denied and OSHA issues a citation, by challenging the warrant and seeking to suppress evidence in administrative proceedings before the Commission. Baldwin Metals, 642 F.2d at 771-77 (exhaustion of administrative remedies doctrine prevented district court from reviewing validity of OSHA warrant because employer could move to quash warrant and suppress evidence). Here, NFIB could raise its APA and OSH Act claims by seeking to quash a warrant. If OSHA issued a citation, NFIB could challenge the warrant and move to suppress the evidence from the inspection in the administrative proceeding, followed by both administrative review and judicial review in an appropriate court of appeals. See 29 U.S.C. 8 An employer could also decline to honor the warrant and defend against a contempt citation on the same basis. See Sec’y of Labor v. Ottman Custom Processors, Inc., 783 F.2d 8 (1st Cir. 1986). Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 25 of 32 PageID 109 Defendants’ Brief in Support of Their Motion to Dismiss - Page 20 of 26 §§ 659(c); 660(a); 661(j). Accordingly, this Court lacks jurisdiction because NFIB has an adequate legal remedy in a court. See Taylor-Callahan-Coleman, 948 F.2d at 959. B. NFIB’s Suit Should Be Dismissed for Failure to State a Claim Upon Which Relief May Be Granted. Even if the Court were to conclude that it has subject-matter jurisdiction, this case nonetheless should be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6). NFIB’s entire case is predicated on the misguided argument that OSHA’s 2013 Letter is a substantial departure from the OSH Act and OSHA’s regulations governing OSHA inspections. It is not. To survive a motion to dismiss under Rule 12(b)(6), the plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). Accordingly, allegations in the complaint “must be enough to raise a right to relief above the speculative level.” Id. at 555. A claim has facial plausibility “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Thus, a “pleading that offers ‘labels and conclusions’ or ‘a formulaic recitation of the elements of a cause of action’” is insufficient to state a claim. Id. (quoting Twombly, 550 U.S. at 555). NFIB claims that OSHA’s 2013 Letter should be set aside because it: (1) is essentially an amendment to OSHA’s inspection regulation at § 1903.8 and therefore required notice-and-comment rulemaking under the APA; and (2) is contrary to the OSH Act. Compl. ¶¶ 47, 54, 59. The APA permits agency action to be set aside only if it is “in excess of statutory jurisdiction, authority, or limitations, or short of statutory right,” “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law,” or “without observance of procedure required by law.” 5 U.S.C. § 706(2)(A), (C), (D). OSHA’s 2013 Letter meets none of these criteria. Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 26 of 32 PageID 110 Defendants’ Brief in Support of Their Motion to Dismiss - Page 21 of 26 1. The 2013 Letter is an Interpretive Rule Exempt from Notice-and-Comment Rulemaking. The APA does not require agencies to follow notice-and-comment procedures in all situations, or even for all “rules.” Rather, the statute specifically excludes interpretive rules and statements of agency policy from these procedures. 5 U.S.C. § 553(b)(3)(A); Perez v. Mortg. Bankers Ass’n, 135 S. Ct. 1199, 1204 (2015). The Supreme Court has explained that the “critical feature of interpretive rules is that they are ‘issued by an agency to advise the public of the agency’s construction of the statutes and rules which it administers.’” Mortg. Bankers, 135 S. Ct. at 1204; see also Batterton v. Marshall, 648 F.2d 694, 705 (D.C. Cir. 1980) (“An interpretative rule serves an advisory function explaining the meaning given by the agency to a particular word or phrase in a statute or rule it administers.”). Interpretative rules “simply state[] what the administrative agency thinks the statute means, and only remind[] affected parties of existing duties.” General Motors Corp. v. Ruckelshaus, 742 F.2d 1561, 1565 (D.C. Cir. 1984) (en banc) (internal quotation marks omitted). In contrast, notice-and-comment rulemaking procedures are required when substantive, or “legislative,” rules are promulgated, modified, or revoked. 5 U.S.C. § 553. Legislative or substantive rules are those that “affect individual rights and obligations.” Shell Offshore Inc. v. Babbitt, 238 F.3d 622, 628 (5th Cir. 2001) (quoting Chrysler Corp. v. Brown, 441 U.S. 281, 302 (1979)). Substantive rules “grant rights, impose obligations, or produce other significant effects on private interests.” Batterton, 648 F.2d at 701-02. Interpretive rules, on the other hand, “typically reflect[] an agency’s construction of a statute [or regulation] that has been entrusted to the agency to administer” and do not “modif[y] or add[] to a legal norm based on the agency’s own authority.” Syncor Int’l Corp. v. Shalala, 127 F.3d 90, 94-95 (D.C. Cir. 1997) (emphasis in original). Thus, an agency rule that merely clarifies or explains existing laws or regulations is interpretive in nature. Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 27 of 32 PageID 111 Defendants’ Brief in Support of Their Motion to Dismiss - Page 22 of 26 Nat’l Medical Enters., Inc. v. Shalala, 43 F.3d 691, 697 (D.C. Cir. 1995) (citing American Hospital Ass’n v. Bowen, 834 F.2d 1037, 1045 (D.C. Cir. 1987)). Here, the 2013 Letter is not a substantive rule because it does not purport to create any new rights or obligations. See United Techs. Corp. v. EPA, 821 F.2d 714, 718 (D.C. Cir. 1987) (rule is legislative “if by its action the agency intends to create new law, rights or duties”) (internal quotations omitted). Nor does 2013 Letter have the force of law; instead, it explains what OSHA believes § 1903.8(c) already requires. Section 1903.8(c) provides that a third-party representative is permitted if the compliance officer determines that the third party is “reasonably necessary” to the conduct of an effective and thorough inspection. By explaining that OSHA considers a third party “reasonably necessary” if the representative will make a positive contribution to the inspection, OSHA simply provided “crisper and more detailed lines than the authority being interpreted.” Am. Mining Cong. v. MSHA, 995 F.2d 1106, 1112 (D.C. Cir. 1993) (MSHA policy letters stating that certain x-ray readings qualified as a diagnosis of lung disease were interpretive rules). NFIB argues that the 2013 Letter is an amendment to OSHA’s existing regulation at § 1903.8 for two reasons. Compl. ¶ 44. First, NFIB argues that the 2013 Letter “creates an exception to Section 1903.8’s categorical rule that the employee representative also must be an employee.” Compl. ¶ 45. Second, NFIB claims that the 2013 Letter “makes a material change in the standard for determining whether a nonemployee may accompany the compliance officer” from “reasonably necessary” to “will make a positive contribution.” Compl. ¶ 46. NFIB also suggests that under § 1903.8(c), a third party must have specialized knowledge germane to the inspection. Compl. ¶ 46. NFIB is wrong on all counts. It is not the 2013 Letter that permits a non-employee to be a representative; it is § 1903.8(c) which allows it. Further, § 1903.8(c) does not, as NFIB claims, require a third-party representative to have “specialized knowledge” to participate in an inspection. Nothing in § 1903.8(c) requires a third party representative to have specialized knowledge. It simply provides two examples of possible Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 28 of 32 PageID 112 Defendants’ Brief in Support of Their Motion to Dismiss - Page 23 of 26 third-party representatives in referencing industrial hygienists and safety engineers. Even without the 2013 Letter, an OSHA compliance officer could determine that, for example, a non-employee representative who can also serve as an interpreter is “reasonably necessary” to the conduct of the inspection if the compliance officer does not speak the same language as employees. 29 C.F.R. § 1903.8(c). Moreover, the 2013 Letter does not change the standard from “reasonably necessary;” rather, the 2013 Letter explains that in OSHA’s view, third-party representatives are reasonably necessary when they will make a positive contribution. 2013 Letter at 2. OSHA’s 2013 Letter is therefore interpretive because it advises the public of OSHA’s construction of § 1903.8(c). Mortg. Bankers, 135 S. Ct. at 1204. 2. OSHA’s 2013 Letter is Consistent with the OSH Act and Its Implementing Regulations. NFIB’s claim that the 2013 Letter must be set aside because it contravenes the OSH Act is also without merit. Compl. ¶¶ 59-60. Moreover, OSHA’s interpretation that a third-party representative is “reasonably necessary” to an inspection when he or she will make a “positive contribution” is reasonable and entitled to deference. See Martin v. OSHRC (CF & I Steel Corp.), 499 U.S. 144, 150-57 (1991) (Secretary’s interpretations of OSHA standards are entitled to deference if they are reasonable); Wal-Mart Distribution Ctr. #6016 v. Occupational Safety & Health Review Comm’n, 819 F.3d 200, 203 (5th Cir. 2016) (agency’s interpretation of own regulation entitled to substantial deference). OSHA’s 2013 Letter is consistent with both the OSH Act and § 1903.8(c). Although NFIB argues that the OSH Act contains “no express authorization for a nonemployee to accompany the compliance officer” on an inspection, Compl. ¶ 56, the OSH Act says nothing about whether an employee representative need be an employee of the employer. 29 U.S.C. § 657(e). Instead, the OSH Act expressly grants broad authority to the Secretary to set the parameters of worksite inspections. 29 U.S.C. § 657(e) (“Subject to regulations issued by the Secretary…”). And, as NFIB Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 29 of 32 PageID 113 Defendants’ Brief in Support of Their Motion to Dismiss - Page 24 of 26 concedes, for the last 45 years, OSHA’s regulations have permitted non-employee representatives to accompany compliance officers during inspections when a compliance officer determines it is reasonably necessary. Compl. ¶ 58; 29 C.F.R. § 1903.8(c). NFIB’s interpretation of § 1903.8(c) that a non-employee representative is allowed “if, but only if, the nonemployee had special skills or knowledge directly pertinent to evaluating the physical safety and healthfulness of a workplace,” Compl. ¶ 58, has no basis in the OSH Act or OSHA’s inspection regulations. The parameters for including a non-employee representative under § 1903.8(c) in an inspection are not as rigid and dogmatic as NFIB suggests. Rather, § 1903.8(c) – like the 2013 Letter – leaves discretion with the compliance officer to determine whether a third- party representative may accompany a compliance officer on an inspection. The 2013 Letter sensibly conforms to the language and purpose of § 1903.8(c). The purpose of both Section 8(e) of the OSH Act and § 1903.8 is to ensure that a compliance officer is able to conduct an effective worksite inspection and that employees are given a voice during an inspection. See, e.g., S. REP. NO. 91-1282, 91ST CONG., 2D SESS. (1970), reprinted in 1970 U.S.C.C.A.N. 5177, 5187 (authorized representative would “aid the inspection” and “provide an appropriate degree of involvement of employees…”). And both § 1903.8(c) and the 2013 Letter focus on whether the third-party representative would aid the compliance officer in his or her inspection of a worksite. Industrial hygienists and safety engineers are the examples provided in § 1903.8(c) of individuals who may be able to provide insight into equipment, processes, or particular hazards on a worksite. Likewise, the 2013 Letter explains that an appropriate representative also may be someone with insight into a workplace based on experience evaluating similar working conditions in a different plant. 2013 Letter at 3. The 2013 Letter’s position that a trusted interpreter could be a third-party representative in workplaces with non-English speaking workers is equally reasonable. 2013 Letter at 3. If a compliance officer is unable to communicate with employees, or if employees are uncomfortable speaking directly to a compliance officer in English, a compliance officer will be Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 30 of 32 PageID 114 Defendants’ Brief in Support of Their Motion to Dismiss - Page 25 of 26 unable to conduct an effective inspection and employees will be deprived of a voice in the inspection. Such result is unacceptable under both Section 8 of the OSH Act and § 1903.8. Accordingly, OSHA’s interpretation that third-party representatives are reasonably necessary when they will make a positive contribution to a thorough and effective inspection is reasoned, consistent with the language and purpose of the OSH Act and OSHA’s implementing regulation and entitled to substantial deference. CF & I Steel Corp., 499 U.S. at 150-57; Wal-Mart, 819 F.3d at 203. IV. Conclusion For the reasons discussed above, the Court should grant defendants’ motion to dismiss for lack of subject-matter jurisdiction and for failure to state a claim upon which relief can be granted. Further, the Court should dismiss NFIB’s claims against defendants with prejudice, tax costs against NFIB, and grant defendants all other relief to which they are entitled. Respectfully submitted, JOHN R. PARKER UNITED STATES ATTORNEY /s/ Lisa R. Hasday Lisa R. Hasday Assistant United States Attorney Texas State Bar No. 24075989 1100 Commerce Street, Third Floor Dallas, Texas 75242-1699 Telephone: 214-659-8737 Facsimile: 214-659-8807 Email: Lisa.Hasday@usdoj.gov OF COUNSEL: Anne Ryder Godoy Attorney, OSH Division U.S. Department of Labor Office of the Solicitor, Suite S-4004 200 Constitution Avenue, NW Washington, D.C. 20210 Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 31 of 32 PageID 115 Defendants’ Brief in Support of Their Motion to Dismiss - Page 26 of 26 CERTIFICATE OF SERVICE I certify that, on November 14, 2016, I electronically filed the foregoing document with the Clerk of Court for the United States District Court for the Northern District of Texas using the Court’s electronic case filing system. That system sends a “Notice of Electronic Filing” to the following attorney in charge for plaintiff: Adam H. Charnes Kilpatrick, Townsend & Stockton LLP 2001 Ross Avenue, Suite 4400 Dallas, Texas 75201 Telephone: 214-922-7100 Facsimile: 214-922-7101 Email: acharnes@kilpatricktownsend.com /s/ Lisa R. Hasday Lisa R. Hasday Assistant United States Attorney Case 3:16-cv-02568-D Document 17 Filed 11/14/16 Page 32 of 32 PageID 116