STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
GUARDIAN INTERLOCK, INC.,
vs.
Petitioner,
Case No. 13-3685RX
DEPARTMENT OF HIGHWAY SAFETY AND MOTOR VEHICLES,
Respondent,
and
SMART START, INC.,
Intervenor.
/
FINAL ORDER
On October 23, 2013, Robert E. Meale, Administrative Law Judge of the Division of Administrative Hearings, conducted the final hearing in Tallahassee, Florida.
APPEARANCES
For Petitioner: John M. Lockwood, Esquire
The Lockwood Law Firm Suite 810
106 East College Avenue Tallahassee, Florida 32301
For Respondent: Charlyne M. ("Khai") Patterson, Esquire
John V. McCarthy, Esquire Department of Highway Safety
and Motor Vehicles 2900 Apalachee Parkway
Tallahassee, Florida 32399-0504
For Intervenor: David K. Miller, P.A.
Kelly Overstreet Johnson, P.A. Frank P. Rainer, Esquire
Broad and Cassel Suite 400
215 South Monroe Street Post Office Drawer 11300 Tallahassee, Florida 32302
Cynthia S. Tunnicliff, Esquire Brian A. Newman, Esquire Brandice D. Dickson, Esquire Mallory L. Harrell, Esquire Pennington, P.A.
Post Office Box 10095 Tallahassee, Florida 32302-2095
STATEMENT OF THE ISSUE
Whether Florida Administrative Code Rule 15A-9.006(2) (the Rule) is an invalid exercise of delegated legislative authority, pursuant to section 120.52(8)(b), (c), and (d), Florida Statutes.
PRELIMINARY STATEMENT
By Petition Challenging Validity of Rule 15A-9.006, Florida Administrative Code, filed with the Division of Administrative Hearings (DOAH) on September 23, 2013 (Petition), Petitioner alleged that the Rule is an invalid exercise of delegated legislative authority. The Petition alleges that the Rule is invalid because Respondent has exceeded its grant of rulemaking authority, the Rule enlarges, modifies or contravenes the laws implemented, and the Rule vests unbridled discretion in Respondent.1/
The Petition alleges that Petitioner manufactures breath alcoholic ignition interlock devices (IIDs), and Respondent is the state agency authorized, by section 316.1938, Florida Statutes, to "certify or cause to be certified the accuracy and precision of the breath testing component of [IIDs.]" The Petition alleges that IIDs are installed on certain motor vehicles of persons convicted of certain driving-under-the- influence (DUI) offenses and are installed when otherwise required by Florida courts.
The Petition alleges that, even though Petitioner's IIDs meet or exceed Respondent's specifications, which are set forth in Rule 15A-9.005, Petitioner is prohibited from marketing its IIDs in Florida because Respondent has not entered into a contract with Petitioner, as provided by the Rule. The Petition alleges that Respondent prohibits manufacturers from offering their IIDs in Florida unless they have entered into such a contract with Respondent.
On September 26, 2013, Smart Start, Inc. (Intervenor), filed a Motion to Intervene on the side of Respondent.
Intervenor alleges that it manufactures IIDs, Respondent issued a Request for Proposals seeking up to two IID vendors for the north and south regions of Florida, and Respondent has tentatively selected Intervenor as a vendor, subject to the outcome of a pending bid protest.
On September 27, 2013, the Administrative Law Judge granted Intervenor's Motion to Intervene.
On October 17, 2013, Alcohol Countermeasure Systems, Inc. and Interlock Systems of Florida, Inc. (Intervenors) filed a Motion to Appear as Amici Curiae. On October 21, 2013, Intervenor filed a response in opposition to the motion. On October 22, 2013, the Administrative Law Judge denied the motion.
At the start of the hearing, Intervenors orally moved for leave to intervene on the side of Petitioner. Over objection, the Administrative Law Judge granted the motion.
At the hearing, Petitioner called one witness and offered into evidence one exhibit: Petitioner Exhibit 1. Intervenors called one witness and offered into evidence no exhibits, Respondent called two witnesses and offered into evidence no exhibits, and Intervenor called one witness and offered into
evidence | three exhibits: | Intervenors Exhibits 1-3. | All |
exhibits | were admitted. |
The court reporter filed the transcript on November 6, 2013. On the next day, the parties filed a Joint Motion to Extend Filing Date for Proposed Order. By Order entered November 8, 2013, the Administrative Law Judge granted the joint motion. The parties timely filed proposed orders on
November 25, 2013.
FINDINGS OF FACT
An IID is:
A breath alcohol analyzer connected to a motor vehicle's ignition. In order to start the motor vehicle engine, a convicted person must blow a deep lung breath sample into the analyzer, which measures the breath alcohol concentration. If the breath alcohol concentration exceeds the fail point on the [IID], the motor vehicle engine will not start.
Fla. Admin. Code R. 15A-9.003(13).
Rule 15A-9.005, which is entitled, "Specifications," provides in part:
All [IIDs] will be required to meet or exceed the standards set forth in the model specifications published in the Federal Register, Volume 57, No. 67, pages 11772- 11787 by the National Highway Traffic Safety Administration.
Technical specifications for the operation and installation of the [IID] shall be described in the contract between [Respondent] and the manufacturer(s).
The [IIDs] alcohol fail point shall be the level specified by Section 316.1937, Florida Statutes.
Rule 15A-9.005(4), (5), and (6) establishes performance specifications for failed-point tests on initial startup and rolling retests and for an emergency bypass.
Rule 15A-9.007, which is entitled, "Certification," provides:
Each manufacturer under contract with [Respondent] will submit certification from an independent laboratory certifying that their [IID] has been tested in accordance with the model specifications published in the Federal Register, Volume 57, No. 67, pages 11772-11787 by the National Highway Traffic Safety Administration and the [IID] meets or exceeds those specifications, as well as criteria set forth in the contract with [Respondent].
The manufacturer shall be responsible for the continuing certification of [IID] service providers for use of an approved [IID].
Rule 15A-9.003(6) defines "certification" as the "testing and approval process required by [Respondent]." Rule 15A-9.003(16) defines "manufacturer" as the "actual producer of the [IID] who assembles the product and who may provide distribution and services." Rule 15A-9.003(21) defines "service provider" as the "retail supplier of the approved [IID]."
Rule 15A-9.008 addresses the installation and removal of IIDs. Rule 15A-9.008(1) requires the "manufacturer or his [sic] representative" to install the IID in accordance with the guidelines of the National Highway Traffic Safety Administration. Rule 15A-19.008(2) requires the "service provider" to develop and deliver an IID orientation to the convicted person.
Rule 15A-9.009 addresses the servicing of IIDs. Rule 15A-9.009(2) requires the "service provider" to service the IID
at the intervals stated in the contract with Respondent, calibrate the IID, retrieve data from the IID and timely submit the data to Respondent, and check for signs of tampering with the IID. Rule 15A-9.009(5) requires an IID to record the time and date of each breath test, the breath alcohol level of each test, and the time and date of any attempt to tamper with the IID. Rule 15A-9.009(6) requires the "manufacturer or service provider" to maintain a toll-free 24-hour emergency telephone support service and fix or replace any nonoperational IID within
48 hours of any call.
Rule 15A-9.006, which is entitled, "Procedure for [IID] Approval," provides:
All ignition interlock devices used pursuant to Sections 316.193 and 316.1937, Florida Statutes, must be approved by the department.
The department shall contract with a manufacturer or manufacturers of ignition interlock devices for the services and commodities required for implementation of Sections 316.193, 316.1937, and 316.1938, Florida Statutes.
The department shall maintain a list of approved ignition interlock devices.
For the specific authority and laws implemented, Rule 15A-9.006 cites the same authority: sections 316.193, 316.1937, and 316.1938, Florida Statutes, and Federal Register Volume 57, Number 67, pages 11772-11787.
Section 316.193 imposes penalties for DUI offenses.
For second and third DUIs, convicted persons must have installed "an [IID] approved by [Respondent] in accordance with
s. 316.1938."
Section 316.1937 authorizes a court to order the installation of an IID under circumstances other than those described in section 316.193. Section 316.1937 provides that the court may prohibit the convicted person from operating a motor vehicle unless it is equipped with a "functioning [IID] certified by [Respondent] as provided in s. 316.1938 "
The most relevant statute to this case is section 316.1938, which provides:
[Respondent] shall certify or cause to be certified the accuracy and precision of the breath-testing component of the [IIDs] as required by s. 316.1937, and shall publish a list of approved devices, together with rules governing the accuracy and precision of the breath-testing component of such devices as adopted by rule in compliance with s. 316.1937. The cost of certification shall be borne by the manufacturers of [IIDs].
No model of [IID] shall be certified unless it meets the accuracy requirements specified by rule of [Respondent].
[Respondent] shall design and adopt by rule a warning label which shall be affixed to each [IID] upon installation. The label shall contain a warning that any person tampering, circumventing, or otherwise misusing the device is guilty of a violation
of law and may be subject to civil liability.
The document at Federal Register, Volume 57, Number 67, pages 11772, et seq., is a notice of the National Highway Traffic Safety Administration of technical specifications for IIDs (Model Specifications). Model
Specifications applies to the manufacture, testing, calibration, data-reporting, and tamper-monitoring of IIDs.
IIDs are manufactured by 16 corporations in the United States. Most, if not all, states operate IID programs for DUI offenders.
Petitioner is a manufacturer and service provider of IIDs. Its sole manufacturing facility is in Cocoa, Florida, where Petitioner employs 30-35 persons. About 35,000 of Petitioner's IIDs are in use in 25 states, but not Florida.
Intervenors, which are affiliated corporations, are manufacturers and service providers of IIDs. (References to Intervenors will include either Intervenor, as appropriate.) Pursuant to the contract described below, Intervenors have provided IID services to over 6000 convicted persons in Florida.
Intervenor is a manufacturer and service provider of IIDs and presently operates in 46 states. Respondent has tentatively selected Intervenor as the sole vendor for the state of Florida in the 2013-14 procurement described below.
In 2003, Respondent issued an invitation to negotiate for IIDs and IID services. Following a tentative award to Intervenors, a vendor challenged the award, arguing, at least in part, that Respondent lacked the authority to limit the number of IID service providers. In a settlement, Respondent awarded the south region of Florida to Intervenors and the north region of Florida to the bid protestor, which was #1 A Lifesafer, Inc. (Lifesafer). In 2004, Respondent entered into contracts for IIDs and IID services with these vendors. As extended, the 2004 contracts are set to expire on March 31, 2014.
Respondent issued a Request for Proposals on July 3, 2013 (RFP). Providing for the replacement of the 2004 contracts described in the preceding paragraph, the RFP is to enable Respondent to select up to two vendors to "implement and operate an [IID] Program" in Florida. RFP Attachment C-19 provides that the term of the new contract(s) shall be five years with an "anticipated" renewal term of another five years.2/
The RFP calls for responses detailing, among other things, the IID hardware by name and model, which must comply with Model Specifications requirements; software to provide Respondent with online access to data downloads from IIDs; installation; service, inspection and monitoring; contractor staffing; training of staff; security and fraud prevention; and
transition services for IID convicted persons being serviced by a party to the current IID contract.
No one filed a specifications challenge to the RFP. Respondent received four responses; they were from Petitioner, Intervenors, Intervenor, and Lifesafer. Petitioner, Intervenors, and Lifesafer have challenged the tentative award to Intervenor, and these bid protests are pending at DOAH as DOAH Case Nos. 13-3924BID, 13-3925BID, and 13-4037BID.
Respondent acknowledges that the procurement of IIDs and IID services by contract provides it more flexibility than if it specified requirements and performance standards by rule. Respondent concedes that other states allow IID service providers to operate IID programs with open competition.
Respondent contends that procuring these IID services by statewide or regional contract ensures the delivery of services to rural areas that otherwise might be underserved, the delivery of uniform services throughout the state, the transmission from the IID service provider of compliance data that would be jeopardized if numerous IID service providers operated in the state, the existence of a process for the removal of an IID service provider that did not discharge its responsibilities in a timely and competent fashion, and the familiarity among Respondent's limited staff with the limited makes of IIDs in use in Florida.
CONCLUSIONS OF LAW
DOAH has jurisdiction because Petitioner and Intervenors are substantially affected by the Rule.
§ 120.56(1)(a) and (c), Fla. Stat.
In the 40 years since the enactment of the Administrative Procedure Act of 1974, Florida courts have addressed numerous times what is meant for a challenger to be substantially affected by a rule. This Final Order discusses in detail all 15 rule-challenge cases in which the courts mentioned a "zone-of-interest" test plus four rule challenge cases containing no mention of the term.
In the first opinion determining that a challenger was substantially affected, Department of Administration v. Harvey,
356 So. 2d 323 (Fla. 1st DCA 1977), the challenger applied for registration for state employment, but the agency rejected her application because the challenger did not meet the agency's unadopted rules setting minimum training and experience requirements. The hearing officer determined that the "denial of avenues of employment" substantially affected the challenger, and the court agreed. Id. at 325.
The court noted that the challenger could have asked the State Personnel Director to certify her training and experience as equivalent to the minimum requirements. She did not pursue this relief, and the court stated that the
"Director's discretion [does not] mitigate . . . the decisive effect, as rules, of the minimum training and experience requirements." Id. at 326.
The court noted that the challenger could have appealed the denial to the Career Service Commission. She did not pursue this relief, and the court stated: "Rule challenge proceedings are available to a substantially affected person who desires to challenge rules on which an agency's decision is based, regardless of whether he also challenges the factual basis of the agency decision." Id.
The court acknowledged that the challenger had requested a section 120.57 hearing on the factual determination that she was unqualified, but the court was "not concerned in this proceeding with the results of that hearing." Id. at n.1.
Harvey predates the application of various tests to determine if a challenger is substantially affected by the challenged rule. However, this case establishes an important injury-in-fact principle: a challenger is not invariably required to exhaust all potential avenues of relief to demonstrate that she is substantially affected by a rule.
In Department of Offender Rehabilitation v. Jerry, 353 So. 2d 1230 (Fla. 1st DCA), cert. denied, 359 So. 2d 1215 (Fla. 1978), an inmate filed a petition challenging a prison rule streamlining procedures for factfinding by prison officials of
alleged inmate offenses. The inmate had been found guilty of an assault on another inmate and, by the time that he had filed his petition challenging the rule, the inmate had already served his penalty. The record did not reflect whether he would lose gain time from the assault.
Ruling that the inmate was substantially affected, the hearing officer reasoned that the inmate did not have to violate the rule again to make the requisite showing. Reversing, the court held that the inmate lacked "standing" because he could not demonstrate an injury of "sufficient immediacy and reality." Id. at 1236. The court declined to presume that the inmate would again violate the rules and commit another assault.3/
In reaching this result, the court surveyed four recent United States Supreme Court standing cases: Sierra Club
v. Morton, 405 U.S. 727 (1972); United States v. SCRAP, 412 U.S.
669 (1973); Roe v. Wade, 410 U.S. 113 (1973); and O'Shea v.
Littleton, 414 U.S. 488 (1974). The Jerry court expressed frustration that the guidance from the federal cases was not always clear.4/
In discussing Sierra Club, the court noted that standing under Section 10 of the federal Administrative Procedure Act (5 U.S.C. § 702) requires allegations that the plaintiff suffered an "injury in fact" and that the "injury was [to5/] an interest 'arguably within the zone of interest to be
protected or regulated' by the statutes that the agencies were claimed to have violated." Jerry, supra at 1233. This was the first mention of a zone of interest in a Florida case determining whether a person was substantially affected by a rule. However, this was the lone mention of a zone of interest in this case. The Jerry court never applied a zone-of-interest test because the court determined that the challenger could not demonstrate an injury in fact.
It appears that the most useful of the four Supreme Court opinions was O'Shea, which determined that claims of violations of 42 U.S.C. § 1983 and other laws did not present a case or controversy under Article III of the United States Constitution. The plaintiffs in O'Shea asserted claims against various public officials, including a judge, for discriminatory and retaliatory practices, such as in applying various laws, setting bail, and imposing sentences. The Court declined to find an injury that was real and immediate because the plaintiffs' claims of injury required the presumption that they would again be arrested and prosecuted.
The next two cases after Jerry determined that rule challengers were substantially affected by focusing exclusively on the injury-in-fact test. In Department of Health and Rehabilitative Services v. Alice P., 367 So. 2d 1045 (Fla. 1st
DCA 1979), the agency issued proposed rules in response to a reduction in federal Medicaid funds for abortions.
Reversing the hearing officer's determination that all Medicaid recipients of childbearing age were substantially affected by the proposed rules, the Alice P. opinion states that Jerry necessitates the holding that a Medicaid recipient who was no longer pregnant could not show an injury in fact. The court implied that another pregnancy for this challenger was comparable in probability to another prison assault by an inmate.
On the other hand, the Alice P. opinion states that a pregnant Medicaid recipient and a physician whose practice would decline from reduced Medicaid funding of abortions were substantially affected. However, these rulings were dicta because the court dismissed their petitions as untimely filed. In determining that these challengers were substantially affected, the court did not mention the zone-of-interest test.
Jerry and Alice P. (Medicaid recipient who was no longer pregnant) illustrate the concept that a challenger may find it impossible to show that she is substantially affected, if she was previously injured by the challenged rule, but is no longer at the time of the rule challenge. These courts were not prepared to make an exception to this principle, but it is possible that they were also disinclined to determine that
another inmate assault or pregnancy was so likely that the challenged rule substantially affected the challenger at the time of the filing of the petition.6/
In the next case, Professional Firefighters of Florida v. Department of Health and Rehabilitative Services, 396 So. 2d 1194 (Fla. 1st DCA 1981), the agency adopted rules requiring the licensing of all persons performing paramedic services, including firefighters not otherwise regulated by the agency. A firefighter trade association challenged the rules on behalf of its members who performed paramedic services without a license. Also challenging the rules were two active firefighters, who had not applied for paramedic certification when they initiated the rule challenge.
The hearing officer determined that the association and individual challengers were not substantially affected. Reversing, the Professional Firefighters court held that the two individual challengers were substantially affected because the rules affected their continued employment. The court found that the probability of their continued employment was less speculative than the recurrence of an inmate assault or other offense, as in Jerry, or another pregnancy by a Medicaid recipient, as in Alice P. The Professional Firefighters opinion explains that the challengers in Jerry and Alice P. were not affected by the subject rules when they filed their petitions,
and "they were unlikely to be affected in the future." Id. at 1196. This statement acknowledges that the function of the court is to determine whether, as of the filing of the petition, the claim of present injury may be informed by future impacts of sufficient probability as to render them real and sufficiently immediate.
The Professional Firefighters opinion breaks down its injury-in-fact analysis into alternative tests: "A party may demonstrate standing by showing that a rule has a real and immediate effect upon his case, as well as by proving injury in fact." Id. at 1195-96. In support of this statement, the court cited Department of Commerce v. Matthews Corp., 358 So. 2d 256,
257 n.1 (Fla. 1st DCA 1978), in which the court described the Jerry holding as a determination that the challenger "had not shown either injury in fact or issues of sufficient immediacy and reality to confer standing." Matthews Corp., supra at 258. Professional Firefighters and Matthews Corp. are the only two cases suggesting that the satisfaction of either alternative would constitute the injury-in-fact test; subsequent courts combined these alternatives into a single test, so that the "real and sufficiently immediate" language now applies to injuries, not issues.
Like Alice P., the Professional Firefighters opinion fails to apply the zone-of-interest test to those challengers
whom it determines are substantially affected. Given that this test and the injury-in-fact test are always identified in the conjunctive, these omissions in Alice P. and Professional
Firefighters are material.
More specifically, the Jerry and Alice P. (Medicaid recipient who was no longer pregnant) challengers had been injured by the challenged rules, but were not so likely to be injured by the rules again as to render them substantially affected by the rules at the time of filing their petitions.
The Professional Firefighters challengers were presently injured by the rule because of the likelihood that they would continue to provide paramedic services--without regard to whether they might later apply for certification and, of so, whether they would obtain certification. The Professional Firefighters
challengers thus showed a greater likelihood of injury than the Jerry and Alice P. challengers were able to show.
The next case to allude to a test similar to the "zone-of-interest" prong7/ is Agrico Chemical Co. v. Department of Environmental Regulation, 406 So. 2d 478 (Fla. 2d DCA 1981), rev. denied, 415 So. 2d 1359 (Fla. 1982).8/ This is a substantial-interests case under section 120.57 (now, section 120.569) that applies to third parties' participation in permitting cases.9/ Agrico filed applications for air and water permits to construct a sulphur terminal facility. The agency
issued the water permit and issued a notice of intent to grant the air permit. Two competing terminal operators filed petitions challenging the proposed air permit. The hearing officer determined that the proposed agency action affected the substantial interests of the challengers.
Reversing, the Agrico court held that the permit challengers' substantial interests were not affected. The court stated that the substantial-interests test required a showing of an "injury in fact which is of sufficient immediacy to entitle [them] to a section 120.57 hearing" and that the "substantial injury is of a type or nature which the proceeding is designed to protect." Id. at 482. Treating the first prong as addressing the "degree of injury," the court found that the permit challengers had shown a "high degree of economic injury." But treating the second prong as the "nature of the injury," the court found that the challengers had failed to show that the economic nature of their injury fell within the protection of the permitting statutes, which did not address competitive matters. Id.10/ The court analyzed closely whether the injured interest was within the zone of protection of a rule that referred to "social and economic impact," but concluded that it was not. Id.
In All Risk Corp. v. Department of Labor and
Employment Security, 413 So. 2d 1200 (Fla. 1st DCA 1982), the
agency issued a notice of intent to repeal workers' compensation rules and adopt rules regulating workers' compensation self- insurers. The proposed rules were challenged by service corporations. The service corporations were not self-insurers, but provided insurance services to self-insurers. After the deadline for challenging the proposed rules, a self-insurer filed a petition.
The service corporations claimed that the proposed rules would increase the cost of nonrefundable bond premiums and potentially threaten the existence of their clients, self- insurers and self-insurer funds. The hearing officer dismissed the petitions of the service corporations on the ground that they had failed to allege that they were substantially affected parties. After an evidentiary hearing on the self-insurer's petition, the hearing officer determined that the intervenor's petition was untimely, so the intervenor, which necessarily had accepted the case as it had found it, could obtain no relief in the absence of timely filing challengers that qualified as substantially affected.
Affirming the hearing officer as to the lack of standing of the service corporations, but reversing a denial of leave to amend, the All Risk opinion fails to identify the infirmities in the allegations of the service corporations. If based on the Final Order, the All Risk opinion probably is
refusing to allow the service corporations to claim the injuries suffered by their clients. The Final Order concludes summarily that the service corporations had not suffered an immediate injury in fact from a proposed rule that applied directly to self-insurers, and any injuries suffered by the service corporations were not to interests within the zone of interest protected or regulated by the challenged proposed rule.11/
The All Risk opinion cites Professional Firefighters
for the requirement that "the rule [must have] a real and immediate effect upon one's case, as well as injury in fact."12/ Id. at 1202. The opinion seems to combine these elements into a single test. Citing Jerry and Agrico, the All Risk opinion also requires that "the alleged interest [must be] arguably within the zone of interest to be protected or regulated." Id.
It would have been helpful if the Final Order (or evidentiary record) in All Risk would have provided the bases for a more-detailed analysis of the claimed injury. For instance, if self-insurers represented a small source of revenue for the challenging service corporations, rules governing the self-insurers would less likely affect substantially the service corporations. But if self-insurers provided nearly all of the revenue for the service corporations, rules governing the self- insurers would more likely affect substantially the service corporations.
In Florida Medical Association v. Department of
Professional Regulation, 426 So. 2d 1112 (Fla. 1st DCA 1983) (FMA), the Board of Optometry issued a proposed rule allowing optometrists to prescribe certain drugs. The proposed rule was challenged by various physicians, as well as a pharmacist and an optometry patient--none of whom was regulated by the board. The hearing officer determined that the challengers were not substantially affected persons.
The First District reversed as to the physicians, but affirmed as to the pharmacist and patient. The court agreed with the hearing officer's conclusion that the physicians had pleaded adequate injury in fact. The court stated that the physicians' petition adequately alleged economic injury to physicians from a rule allowing optometrists to prescribe drugs. The existence of the injury to the physician challengers from the proposed rule is obvious.
The importance of FMA is that the court disagreed with the hearing officer's conclusion that the physicians had not asserted an interest "within the 'zone of interests' protected by the statute being implemented by the rule." Id. at 1114. If applied in accordance with the language that had been used up to this point to describe the zone-of-interest test, this test posed an insurmountable hurdle for the physicians because, unregulated by the Board of Optometry, they lacked any interest
within the zone of interest regulated or protected by the challenged rules or enabling statutes.
The FMA court cited longstanding Florida precedent, predating the Administrative Procedure Act of 1974, conferring standing upon professionals to challenge encroachments upon their professions authorized by rules governing members of other professions. Id. at 1116-17. It is clear from the opinion that the FMA court was disinclined to disturb this sensible precedent.
The FMA court traced the source of the zone-of- interest test to Data Processing Service v. Camp, 397 U.S. 150 (1970).13/ The FMA opinion notes that Agrico "oddly" did not mention Data Processing or the "'zone of interest' test" by name, although the second prong of the Agrico test for a third- party's showing of substantial interests bears a clear resemblance to the zone-of-interest test.
The FMA court distinguished Agrico--and rejected the hearing officer's reliance on the case. In Agrico, the permit challengers challenged the agency's proposed issuance of a permit under environment laws; they did not challenge the laws themselves. In FMA, the rule challengers questioned the validity of the agency's exercise of delegated legislative authority. Id. at 1114-15. Thus, courts must apply the zone- of-interest prong of the substantially-affected-person test
differently from the second Agrico prong, notwithstanding any resemblance between these prongs and notwithstanding their common function of providing a framework within which a court may examine the nature of a party's injury to determine if it is of a type or nature to allow him to participate in administrative litigation.
The FMA court had two solutions to its zone-of- interest problem. It could have discarded the test--explicitly or implicitly in the sub silentio tradition of Alice P., Professional Firefighters, and All Risk. Or the court could have allowed the physicians to identify their interest as within the zone of interest protected or regulated by another rule or statute.14/
The FMA opinion cites without criticism a nearly identical case of professional-encroachment rulemaking in which the Rhode Island Supreme Court ruled that the challengers were required to show injury in fact, but not an injury to an interest in any zone of interest. The FMA opinion also notes that Professor Davis had recently complained that the zone-of- interest prong sometimes is applicable and sometimes is not applicable, and a criterion for determining when it is applicable is unavailable. Id. at 1116 n.9 (citation omitted).
Ultimately, the FMA court retained the zone-of- interest test, but rejected the agency's argument that the
physicians must assert an injury solely within the zone of interest protected by the statutory chapter governing optometrists. The court instead applied a loosened zone-of- interest test that allowed the physicians to assert an interest in a zone of interest protected or regulated by any law, not merely the challenged rule or its enabling legislation. Id. at 1117-18. The court reasoned that Agrico does not hold that "the basis for standing must be found within the particular statute being implemented by agency action." Id. at 1117-18.15/
In Montgomery v. Department of Health and
Rehabilitative Services 468 So. 2d 1014 (Fla. 1st DCA 1985) (per curiam) (dictum), food stamp recipients challenged agency rules predicating their continued receipt of food stamps on participation in a workfare program. The court stated that the challengers were substantially affected, although it affirmed a hearing officer's dismissal of their petition on the ground of mootness. The Montgomery opinion states:
In Florida, the courts have adopted the federal 'injury-in-fact' test governing standing, [Jerry, supra], and the federal 'zone-of-interest' test where applicable. [FMA, supra].4 [N.4 The federal law of standing is complex, inconsistent, and unreliable. 4 Davis, Administrative Law Treatise, § 24:1 (Second Edition, 1983). The Florida law of standing borrows much of its underpinnings from the federal law and thus arguably may be said to be subject to the same vagaries.] In this case, we are
only concerned with whether appellants have met the injury-in-fact test.
Montgomery, supra at 1016.
For the injury-in-fact test, Montgomery is similar to Professional Firefighters. The challenger was substantially affected by the immediate imposition of the workforce requirement and, evidently, the likelihood that she would continue to receive food stamps; she is substantially affected even though she had not yet failed to comply with the workforce requirement and suffered the loss of food stamps. As in Professional Firefighters, as well as Harvey, the Montgomery
court found injury, even though the challenger had exhausted all options available to her--i.e., performing the workfare in Montgomery, applying for paramedic certification in Professional
Firefighters, and pursuing the various remedies identified in Harvey.
Like Alice P., Professional Firefighters, and All Risk, the Montgomery opinion acknowledges the zone-of-interest test, but fails to apply it, even though, in dictum, the court concluded that the challenger was substantially affected.16/ These four cases suggest that courts were finding situations where the zone-of-interest test was not applicable, as stated in the Montgomery opinion, but no court ever revealed why.
In Board of Optometry v. Florida Society of
Ophthalmology, 538 So. 2d 878 (Fla. 1st DCA 1988), rev. denied,
542 So. 2d 1333 (Fla. 1989), the board adopted a rule to allow optometrists to administer certain eye medicines. At one time, the right to administer these drugs had been exclusively within the practice of certain physicians, but, prior to the commencement of the rule challenge, the legislature had amended the law so that these physicians no longer enjoyed this exclusive right.
The hearing officer determined that the challengers were substantially affected. The court reversed. Citing Jerry, the court stated that a challenger must show a direct injury in fact of sufficient immediacy and reality. Society of Ophthalmology, supra at 881. Because of the recent legislative change, the challengers no longer enjoyed an economic right that was fully protected by statutes, so they could not satisfy the injury-in-fact test, the court concluded. Nor was the challenger's general interest in the quality of eye care of sufficient immediacy and reality to satisfy the injury-in-fact test. Id. The court determined that the challengers were not subject to regulation or control by the rule, and their claim of an injury caused by the rule was purely a matter of speculation and conjecture. Id.17/
A person could be substantially affected by a rule that impacts a nonexclusive right, although a rule impacting an exclusive right results in more visible injury. The causal chain between the challenged rule and the claimed injury requires closer analysis when the injury is to a nonexclusive right. Clearly, the situation is different from FMA, as the court noted, but the court's application of this bright-line test unfortunately displaced closer analysis, which might have revealed that the challengers were substantially affected by the rule.
In International Jai-Alai Players Association v.
Florida Pari-Mutuel Commission, 561 So. 2d 1224 (Fla. 3d DCA) (per curiam), rev. denied, 576 So. 2d 288 (Fla. 1990), the majority of the court held that an association failed both prongs of the Agrico substantial-interests test.18/ For present purposes, the interesting part of this opinion is the dissent. As noted above, the second prong of the Agrico substantial- interests test resembles the zone-of-interest prong of the substantially-affected-persons test. The dissenting judge expressed "considerable doubt" about whether the second Agrico prong of the substantial-interests test survived Florida Home
Builders Association v. Department of Labor and Employment Security, 412 So. 2d 351 (Fla. 1982), in which the Supreme Court had held that a trade association could be a substantially
affected person if, among other things, a substantial number of its members are substantially affected.19/ Int'l Jai-Alai, supra at 1226-27 (Ferguson, J., dissenting).20/
In Department of Professional Regulation v. Florida Dental Hygienist Association, 612 So. 2d 646 (Fla. 1st DCA 1993) (per curiam), the Board of Dentistry issued proposed rules to approve a specific dental hygiene program in Alabama and relax the criteria for the approval of dental hygiene programs, including out-of-state programs. The Florida Dental Hygienist Association filed petitions challenging the proposed rules. The hearing officer determined that the association had pleaded that it was substantially affected by the proposed rules.
The court affirmed the hearing officer's ruling. The court noted that the hearing officer had distinguished Professional Firefighters on the ground that the dental hygienist rules would not initiate licensure requirements where none had previously existed. The hearing officer had also distinguished Society of Ophthalmology on the ground that the dental hygienist rules did not permit a licensed profession to engage in an activity previously, but no longer, reserved exclusively for another profession.
The court observed that the dental hygienists21/ had not specifically alleged a prospective or threatened economic injury. Id. at 649. In addition to the absence of specific
allegations of economic injury, the allegations that the hygienists were protecting public safety and welfare had to be dismissed because they were similar to those that had recently been determined to have been insufficient in Society of Ophthalmology. Id. at 650.
The dental hygienists alleged that the licensing of lesser-qualified hygienists would produce a less-qualified pool of competitors, so as to adversely affect the employment of higher-qualified hygienists. The court acknowledged that the dental hygienists were alleging frankly anti-competitive interests, which presented a case of first impression to the court. Id. at 649. Although the record did not show to what extent dentists would employ less-qualified hygienists, the court found this development "likely" due to the enthusiastic endorsement of the subject rules by dentists testifying at the hearing. Id. at 650.
Ultimately, the court agreed with the dental hygienists' injury-in-fact argument that, by allowing previously unqualified persons into the occupation, the proposed rule substantially impacted dental hygienists by diminishing the value of their education and training. Id. at 650. The court noted that the anti-competitive interests of the challengers, id. at 649, compared to the physicians' concerns of professional encroachment in FMA. Id. at 651.
The Dental Hygienist court cited FMA for its discussion of the claim of illegality underpinning a rule challenge case. Id. As noted above, this discussion in the FMA
opinion justified the court's loosening of the zone-of-interest test. In Dental Hygienist, this reference does not lead to analysis of the zone-of-interest test, but is intended to reinforce the court's injury-in-fact analysis. The Dental
Hygienist court mentions this discussion in FMA in an attempt to distinguish the dental hygienists' alleged injury in fact from an injury resulting from encroachment upon competitive interests.22/ Id.
Arguing for an expansive application of the injury-in- fact test, the Dental Hygienist court stressed that the "claim of illegality" in a rule challenge proceeding meant that an agency has committed an unconstitutional exercise of delegated legislative authority and must be distinguished from a claim of mere professional encroachment. Id. The opinion quotes from Professor Patricia A. Dore's article, Access to Florida Administrative Proceedings, 13 Fla. St. U. L. Rev. 965, 1014 (1986), in which Professor Dore wrote that the rule-challenge access standard of "substantially affected person" "'was intended to create an opportunity for a citizen initiated check on rule making that exceeded delegated legislative authority.'" Id. at 652. The opinion adds that Professor Dore "believed that
such a proceeding could be initiated by 'any person who would be affected in an important and significant way.'" Id.23/
For additional support of its conclusion that the dental hygienists had pleaded injury in fact, the court observed that the Florida Dental Association had been allowed to intervene aligned with the agency and it was thus necessary to allow the dental hygienists to participate, so both sides could be "fully heard."24/ Id. at 652.
Notwithstanding the last argument, which substitutes a fairness-of-the-proceeding test for the statutory determination of whether the challenger is substantially affected by the rule, Dental Hygienist is an important injury-in-fact case. It is not a classic professional encroachment case because the competition is from members--albeit, from other states--of the challenger's own profession.
But, among all of the cases considered in this Final Order, Dental Hygienist presents the most tenuous chain of causation between the challenged proposed rule and the claimed competitive injury, which, of course, is ultimately economic in nature. The dental hygienists traced a five-step chain of causation from the proposed rule to actual injury: 1) less- educated dental hygienists will be less-qualified dental hygienists; 2) less-educated, out-of-state dental hygienists will relocate to Florida in significant numbers; 3) once in
Florida, less-qualified dental hygienists will work for less than the prevailing wage presently paid to better-qualified dental hygienists; 4) Florida dentists will hire the less- qualified dental hygienists because they will prefer cheaper hygienists over more qualified hygienists; and, finally, 5) the better-qualified dental hygienists will suffer economic injuries from the loss of jobs to the less-qualified dental hygienists.
For the claim of injury to their educational credentials, the chain of causation was much shorter, but the injury was much less clear. At least at the end of the more tenuous chain of causation on the anti-competitive claim, the economic injury is clearer.
As noted above, Dental Hygienist mentioned, but did not apply, the zone-of-interest test. Dental Hygienist thus joins Alice P., Professional Firefighters, All Risk, and Montgomery in concluding that a person could be substantially affected without determining that the person has satisfied the zone-of-interest test.
In Ward v. Board of Trustees of the Internal
Improvement Trust Fund, 651 So. 2d 1236 (Fla. 4th DCA 1995) (per curiam), the court applied the injury-in-fact and zone-of- interest prongs of the substantially-affected-person test.
Claiming injury to nonenvironmental interests, a professional engineer challenged proposed rules relating to the construction
of docks in aquatic preserves. The hearing officer concluded that the petition did not allege sufficient facts to determine that the challenger was substantially affected by the proposed rules.
The court reversed. Citing Professional Firefighters, the court stated that, to satisfy the "sufficiently real and immediate injury in fact element," the injury may not be based on "pure speculation or conjecture." The court observed that the injury-in-fact test is satisfied by a rule or statute that directly regulates the challenger's occupation, as in Professional Firefighters. Ward, supra at 1238. The court stated that the injury-in-fact test is also satisfied when the challenged rule or the statute has the effect of regulating persons in an occupation, as in Alice P. (physician). Id. at 1237-38.
The Ward court reasoned that the engineer could challenge the proposed aquatic preserve rules due to "the economic and administrative adverse impact to appellant," as well as the effect of the rules in undermining the engineer's ability to comply with his professional duties and the statutory duty to design safe docks and piers. Ward, supra at 1238.
Addressing the zone-of-interest test, the Ward opinion states:
the protected zone of interest need not be found in the enabling statute of the challenged rule itself. [FMA, supra.] "Since the crux of [a rule challenge] controversy involves the claim that [the enabling statute] does not authorize the rule, it is obvious that the effect of other statutes must be considered in determining standing." Id.
Ward, supra at 1238.
It is unclear whether the interest of the engineer was within the zone of interest protected by the challenged proposed rules or their enabling statutes, which pertained to aquatic preserves and environmental protection. But the Ward opinion does not restrict the engineer to the Aquatic Preserve Act for satisfying the zone-of-interest prong. Instead, the opinion traces the protection of his injured interest to Chapter 471, which governs the engineering profession, and specifically a statutory provision declaring the legislative finding that incompetent engineers performing services in Florida could cause physical and economic injuries to Florida citizens. Id. at 1238-39.
Ward represents a straightforward application of the injury-in-fact test to determine that the rule injures the challenger. Ward also reformulates the conventional zone-of- interest test to accommodate the obvious need of the engineer to be able to challenge a rule that substantially affects him in his engineering practice.
The next case to mention the zone-of-interest prong is Televisual Communications v. Department of Labor and Employment Security, 667 So. 2d 372 (Fla. 1st DCA 1995) (per curiam). The agency issued proposed rules to implement a mandate to certify health care providers under a recent amendment to the Workers' Compensation Act. Among the rules was a continuing-education requirement that, if a program included audio-visual materials, an approved instructor must be present at the instruction site. The challenger was a publisher of educational materials that had produced continuing-education video programs for five years. Based on the opportunity to service this new market, the challenger claimed an injury by the rule's effect on its ability to earn new revenues, not on the loss of existing revenues. The president of the challenger testified that the ability to market educational videos without live instructors had the "potential for about doubling our sales." Id. at 373.
The hearing officer concluded that the challenger was not substantially affected. The hearing officer reasoned that the challenger was not a health care provider directly regulated by the statute or proposed rule, and the financial injury to the challenger was speculative.
The court disagreed with the hearing officer's analysis of the injury-in-fact prong. The court stated that the proposed rules regulated physicians and producers of educational
materials. The court added that the proposed rules had the "collateral effect of regulating [the challenger's] industry." Id. at 374.
In its injury-in-fact analysis, Televisual seems to conflict with All Risk. In both cases, rules indirectly impacted the challengers through the regulation of parties affiliated with the challengers. In both cases, challengers were thus one step removed from the rules' direct regulatory force. In All Risk, service corporations claimed economic injury from the effect of the rule's requirements that were imposed on the service corporations' customers, self-insurers. In Televisual, the video producer claimed economic injury from the effect of the rule's requirements that were imposed on a new market of end-users. An important difference between the cases is that the challenger's revenues were existing in All Risk and anticipated in Televisual. But neither opinion analyzes the facts that would support or oppose these claims of injury. To support a determination favorable to the challenger, the Televisual court even forged a new label, collateral regulation, to displace a more detailed analysis of the facts.
Televisual does not address the zone-of-interest test.
The court discussed Society of Ophthalmology, which, as noted above, did not address the zone-of-interest test. Televisual
thus joins Alice P., Professional Firefighters, All Risk, Montgomery, and Dental Hygienist in concluding that a person could be substantially affected without determining that the person has satisfied the zone-of-interest test. Like the other courts, the Televisual court mentions this prong, but, in doing so, the court reverts to the pre-FMA or conventional formulation of the test: "the injury [must be] within the zone of interest to be regulated or protected." Id.
The line of case mentioned in the preceding paragraph grew by another case when the court in Cole Vision Corp. v.
Department of Business and Professional Regulation, 688 So. 2d
404 (Fla. 1st DCA 1997), concluded that the challenger was substantially affected, but limited its analysis to the injury- in-fact test. The agency had issued a proposed rule prohibiting various legal entities from engaging in the practice of optometry by hiring licensed optometrists, unless the entities themselves were licensed practitioners of optometry. The court determined that a corporation was substantially affected because it operated several retail optical stores and was not itself licensed. The court rejected the agency's All Risk argument that the rule regulated the conduct only of licensed optometrists because a statute imposed a fine of up to $5000 for any violation of the statute or rule by any unlicensed person.
The available facts are sketchy, but Cole Vision seems to resemble Harvey, Professional Firefighters, and Montgomery, in which the courts recognize that a challenger is substantially affected by a rule before the challenger has exhausted all contingencies to determine if the rule applies to her or before she has exhausted all options to comply with or mitigate damage from the rule.
In the next case, the court applied both prongs to determine that a challenger was substantially affected by the rule. Although the court described the loosened zone-of- interest prong, as formulated in Ward, this case represents the first time that a challenger satisfied an application of the conventional formulation of the zone-of-interest test. In Lanoue v. Florida Department of Law Enforcement, 751 So. 2d 94 (Fla. 1st DCA 1999), a motor vehicle driver took two roadside breath tests, resulting in a determination of an unlawful breath-alcohol level of 0.09g/210L. The driver was charged with DUI and his license was administratively suspended for six months. The driver pleaded not guilty.
Prior to his trial on the DUI charge, the driver challenged various rules, including those providing for the inspection and calibration of breath-testing machines. The hearing officer determined that the driver was not substantially
affected by the rules because he failed to prove a real and sufficiently immediate injury in fact.
Reversing, the Lanoue court held that the driver had satisfied both prongs of the substantially-affected-person test and cited Ward, All Risk, Cole Vision, and Televisual. After reviewing various elements of the DUI laws, including the implied-consent law, the court noted that the driver was awaiting trial on charges that could result in substantial criminal penalties. The court concluded that the driver's "substantial interests" were "affected" by the challenged rules, and the driver had "thus alleged a real and sufficiently immediate injury in fact." Lanoue, supra at 98.
Relying on the loosened zone-of-interest test identified in Ward and used in Ward and FMA, the Lanoue opinion states that the zone-of-interest prong requires that "a statute, or a rule implementing such statute, encroach . . . upon an interest protected by a statute or the constitution."25/ Id. at 98-99. Citing Ward and FMA, the Lanoue opinion adds that the zone of interest in a rule challenge "need not be found in the enabling statute of the challenged rule itself." Id. Earlier in the opinion, though, the Lanoue court, citing the conventional zone-of-interest test contained in Televisual, stated that the injury must be within the zone of interest
regulated by the implied-consent "statutes and rules." Id. at
97.
The challenged rules implemented the implied-consent
law, and the Lanoue court cited case law holding that the purposes of this law include producing reliable evidence and protecting the health of tested subjects. Although a straightforward application of the conventional zone-of-interest test could have determined that the driver's injury was within the zone of interest of the enabling legislation--namely, the production of reliable evidence--the Lanoue analysis of the
zone-of-interest prong is more circuitous and difficult to follow. The opinion reasons that, because the driver has been charged with a crime and has borne a license suspension, which are remedies provided by the implied-consent law, he has an interest in the zone of interest regulated by those statutes and rules--although these facts seem as much to reinforce the
injury-in-fact analysis.
The Lanoue court cited Cole Vision for the principles that a challenger is substantially affected by rules that regulate her and subject her to legal action and monetary penalties for noncompliance. The court cited two other cases involving the "personal stake" necessary for a person to have standing to challenge the constitutionality of statutes. All of
these are concepts associated with injury in fact, not zone of interest.
In dismissing the hearing officer's finding that the driver had failed to prove that any calibration error could have affected the results of the tests, the Lanoue opinion notes that the implied-consent law implies the driver's consent to an approved breath-alcohol test. This is about as close as the opinion gets to recognizing a more direct path to determining that the challenger has satisfied the zone-of-interest prong, even as conventionally formulated.
In Board of Medicine v. Florida Academy of Cosmetic Surgery, Inc., 808 So. 2d 243 (Fla. 1st DCA 2002), the board issued a proposed rule requiring an anesthesiologist to be present for all level III office surgeries. The Florida Nurses Association and Florida Association of Nurse Anesthetists challenged this proposed rule, and the Administrative Law Judge determined that they were substantially affected persons.
The Cosmetic Surgery opinion affirms that these two trade associations were substantially affected by the proposed rule. The court cited Lanoue, Ward, All Risk Corp., and Jerry as authority for the two-prong test and cited Florida Home
Builders for the additional elements required of an association to prove that it is substantially affected. The Cosmetic
Surgery court rejected the board's argument that the challengers
failed to prove that a substantial number of their members would be substantially affected by the proposed rule.
The Cosmetic Surgery opinion notes that both associations proved that their members included certified registered nurse (RN) anesthetists with office practices. The court stated that the lack of direct regulation of RN anesthetists by the challenged proposed rule was "not fatal." Cosmetic Surgery, supra at 251. The opinion mentions Ward and Televisual, as support for the preceding statement and notes that a number of physicians had testified that they would not employ RN anesthetists in level III office surgeries, if they were required to employ an anesthesiologist at such surgeries.
The Cosmetic Surgery opinion rejects the board's argument that the challengers' injury was insufficiently real and immediate because they could still be employed for level I and II surgeries. The court reasoned that this argument went merely to the "scope of the injury," not to whether it satisfied the injury-in-fact prong. This result makes sense because the requisite injury does not need to divest the substantially affected person of all rights.
But it is unclear why the Cosmetic Surgery court refused to include the scope of the injury in its analysis. In Society of Ophthalmology, the court found that the challenger that no longer enjoyed exclusive rights could not be
substantially affected by a rule that further encroached on these rights. Close analysis in these opinions of the relationship between the challenged rule and its effect on the challenger would seem to be facilitated by analysis of the specific rights of the challenger prior to impact by the rule.26/
There is no explicit zone-of-interest analysis in Cosmetic Surgery. In noting that the challengers never asserted that they had a "protected interest" to be free from competition--an injury-in-fact factor, as discussed in Dental Hygienist--the court stated that the challengers asserted instead merely an interest in providing anesthesia services in level III office surgery without supervision by an
anesthesiologist. The court traced this argument to the statute that requires physicians to supervise RN anesthetists. It is not entirely clear from the opinion if this statute was among those implemented by the challenged proposed rules. If so, this is a conventional zone-of-interest analysis. If not, this is a loosened zone-of-interest analysis along the lines of FMA and Ward.
In NAACP v. Board of Regents, 822 So. 2d 1 (Fla. 1st DCA 2002), the board proposed rule amendments restricting the use of affirmative action based on race and gender for certain university admissions. A civil rights organization, a tenth- grade African-American student, and the student's mother
challenged the rule amendments. The student hoped to attend a university in the State University System and major in computer science or engineering.
The Administrative Law Judge determined that the challengers were substantially affected.27/ The First District reversed, mandating that the Administrative Law Judge dismiss the rule challenges of all parties. Ultimately, the Florida Supreme Court quashed the opinion of the First District and held that the NAACP, the student, and his mother were substantially affected.28/
The First District's analysis identifies the two- prong substantially-affected-person test, citing Lanoue, Ward, All Risk Corp., and Jerry. For the zone-of-interest prong, the court used the Televisual formulation rather than the Ward
formulation, id. at 4, but the difference is unimportant because the First District determined that the challengers had not suffered an injury in fact and thus did not consider whether the injury was to an interest within any zone of interest.
The First District determined that NAACP had failed to prove that the challenged rule amendments would cause a real and sufficiently immediate injury to any of its members, who, it appeared to the court, were unwilling to tolerate the replacement of a beneficial policy of affirmative action with another policy that might not prove as beneficial. NAACP, supra
at 6. Focusing on the student, the court stated that, at his current rate of academic progress, he would qualify for university admission regardless of the impact of the challenged rule amendments. Because he had two more years until admission, in any event, any claimed injury could not be real and sufficiently immediate, but would rest on "rank speculation." Id. at 7.
In dissent, Judge Browning mostly addressed the majority's holding as to NAACP, but added that he believed that the minority student was substantially affected because the challenged rule amendments would regulate his university admission. Judge Browning offered his own version of Professor Dore's suggested test: the effect of the rule amendments "on African American students plainly differs from its effect on non-minority students, and this, without question, provides standing to the NAACP."29/ Id. at 12 (Browning, J., dissenting).
Responding in kind to the majority's characterization of the claim of linkage between the proposed rule amendments and injury to students as "rank speculation, Judge Browning stated that it was "unfathomable that Chapter 120 sanctions what the majority has determined." Id. at 13. Ultimately, Judge Browning reduced the standing issue to the "crucial factor [of] how one weighs the impact of the proposed [affirmative action] rules on
African-Americans' admission rights to the [State University
System], as compared to their rights under the repealed affirmative action programs." Id.30/
This last statement is in sharp contrast to the approaches of the courts in Society of Ophthalmology and Cosmetic Surgery. In Society of Ophthalmology, the court determined summarily that the challenger could not have been substantially affected by an encroaching rule because the right regulated by the rule no longer belonged exclusively to the challenger's profession. In Cosmetic Surgery, the court rejected without discussion the agency's argument that the challenger was not substantially affected by a rule limiting her right to provide services in level III surgery because it did not affect her right to provide services in levels I and II surgery. Judge Browning's functional approach instead considers the challengers' rights as they existed prior to the proposed rule amendments and examines how the challenged rule amendments would affect those rights. If their preexisting rights were extensive, a lesser impact from the rule amendments could have the same impact as a greater impact to less extensive preexisting rights.
Denying a motion for rehearing, the First District in NAACP v. Board of Regents, 2002 Fla. App. LEXIS 10445 (Fla. 1st DCA 2002) (per curiam), certified to the Florida Supreme Court the question of whether the challengers had standing.
In NAACP v. Board of Regents, 863 So. 2d 294 (Fla.
2003), the Florida Supreme Court answered the certified question in the affirmative. In terms of tests, the Court noted only that the First District had concluded that NAACP had failed to prove that any of its members would suffer a real and sufficiently immediate injury in fact. Id. at 296.
The Supreme Court quotes approvingly Judge Browning's statement that the crucial factor was to weigh the impact of the proposed rule amendments on African-Americans' admission rights compared to their rights under the repealed affirmative action programs. Id. at 297. After a review of its Florida Home Builders holding, the Court stated that it agreed with Judge Browning's analysis that NAACP had standing if "'the effect of the proposed rules on African-American students plainly differs from its effect on non-minority students . . ..' (Citation omitted.)" Id. at 299. Rejecting the requirement that NAACP demonstrate "immediate and actual harm, i.e., rejection of admission to a state university by a member before standing would be granted," the Court stated that Florida Home Builders
requires instead only that an association show that the rule change would have a substantial effect on a substantial number of its members. Id. at 300.
The portions of the NAACP opinion that describe what an associational challenger must show to be substantially
affected applies with equal force natural persons. As the court acknowledged, the association must show, among other things, that a substantial number of its members are substantially affected by the challenged rule. NAACP, supra at 298 (citing Florida Home Builders, supra at 353).
The NAACP Court determined that the challengers were substantially affected without reliance on judge-made tests; it simply applied the statutory language to the facts before it, recalling the Harvey opinion. NAACP also serves as another case in the line of cases--Harvey, Professional Firefighters, Montgomery, and Cole Vision--in which the court made the forward-looking determination that the tenth grade student was substantially affected before all of the contingencies had been exhausted--e.g., before he had applied to a university.
The first post-NAACP decision on access to rule challenges does not mention NAACP, but mentions the zone-of- interest prong. In Jacoby v. Board of Medicine, 917 So. 2d 358 (Fla. 1st DCA 2005), the board issued rules restricting the licensing of out-of-state physicians. A New York-licensed physician applied for a Florida license, and the board denied the application because of the applicant's discipline in New York for an 18-year failure to repay student loans. The physician appealed the license denial and challenged certain
rules and nonrule policies on which the board had relied in denying his application.
The Administrative Law Judge dismissed the rule challenge due to a failure to show that the physician was substantially affected. The court reversed.
Citing FMA, the Jacoby opinion identifies the two- prong test, using the Televisual formulation of the zone-of- interest prong. Id. at 360. Addressing the injury-in-fact prong, the court distinguished Jerry on the basis that the challenger in that case was not affected by the rule when he filed his petition. By contrast, the physician's application had been denied, and he could reapply in the future--presumably, a lawful contingency far less speculative than a recurrence of an unlawful prison assault. Further, the physician, as an applicant, was already subject to the board's licensing rules. The court cited FMA for the holding that a challenger suffers a real and immediate injury in fact when a rule impacts his or her right to earn a living.
Jacoby resembles an older right-to-earn-a-living case, Harvey, in another respect. In both cases, the challenger's pursuit of relief in the form of a section 120.569 hearing on the factual grounds for the agency's adverse action was irrelevant to the issue of whether the challenger was substantially affected by the challenged rule. The access
determination is a threshold determination that does not yield to finely tuned election-of-remedy arguments.
The Jacoby opinion states that the zone-of-interest prong was satisfied because the challenger--not any injured interest of the challenger--was within the zone of interest to be protected or regulated. Citing Professional Firefighters, which contains no zone-of-interest analysis itself, the Jacoby
court seemed to be stating that, regardless of whether the challenger satisfies either prong, a challenger is substantially affected if he "is affected by licensing rules because the individual works in the area regulated." Jacoby, supra at 360. This statement rephrases without material change the same statement in Professional Firefighters, but omits the next statement in the earlier case: "When an agency sets up a new licensing or certification requirement for an occupation or profession not previously subject to state-wide regulation or licensing, persons engaged in that occupation or profession have standing to challenge the proposed regulation." Professional Firefighters, supra at 1196.
In one important respect, an out-of-state applicant case is like a professional suffering encroachment. In both cases, current Florida licensees will not complain about an invalid rule excluding competition in the former case or enlarging their authority in the professional encroachment case.
If the out-of-state applicant or encroached-upon professional is denied access to challenge the rules, the invalid rules will remain unchallenged. Courts will understandably apply the zone- of-interest test--or not apply it--to avoid this result.
The next case to mention the zone of interest is interesting because the opinion suggests that, although the challengers may have demonstrated that their interests were within the zone of interest regulated by the proposed rule, they had not alleged that the application of the rule would result in a real and sufficiently immediate injury in fact. In a per curiam reversal of the Administrative Law Judge's determination that the challengers had standing, the court, in Office of
Insurance Regulation v. AIU Insurance Co., 926 So. 2d 479 (Fla. 1st DCA 2006) (per curiam), held that the challengers failed to show that the application of the proposed rule would result in a real and sufficiently immediate injury. The five-sentence opinion cites to Cosmetic Surgery, but provides no description of the proposed rule or the challengers and does not explain the court's reasoning.
The Final Order in AIU Insurance Co. v. Department of Financial Services, 2005 Fla. Div. of Admin. Hear. LEXIS 770 (2005), states that the proposed rule applied to property and casualty insurers' rate filings, pursuant to the recently enacted federal Terrorist Risk Insurance Act of 2002 (TRIA).
Recognizing that insurers might have difficulty demonstrating that their TRIA rates were not excessive, inadequate, or unfairly discriminatory, the proposed rule allowed an insurer to use any methodology that demonstrated compliance with Section 627.062, or, if unable to demonstrate such with its own methodology, an insurer was allowed adopt the methodology, data, or rates of another insurer that had already obtained the agency's approval for similar risks.
Without much analysis, the Administrative Law Judge determined that three insurers were substantially affected persons because they had three TRIA rate filings pending with the agency and were parties in administrative proceedings involving the agency's disapproval of their TRIA filings for other lines of property and casualty business. The Administrative Law Judge added that the insurers could make additional TRIA filings for additional lines of property and casualty business.
It is difficult to understand why the court concluded that the insurers had not suffered injuries in fact. Perhaps the modest scope of the rule drove the ruling. The rule required only that the insurers adopt a methodology that conforms to a statute or, failing that, adopt the methodology of another insurer whose TRIA rates have been approved. But, as the court suggested, it would appear that the interests of the
insurers would be within the zone of interest of a rate-setting statute.
In Abbott Laboratories v. Mylan Pharmaceuticals,
Inc., 15 So. 3d 642 (Fla. 1st DCA 2009), a generic drug manufacturer challenged a rule to have its generic thyroid medication removed from the Negative Drug Formulary, so it could be substituted freely for a brand name drug of a competitor.
The brand name drug manufacturer intervened on the side of the agency to defend the rule and keep the generic drug from competing with the intervenor's brand name drug.
The Abbott Labs opinion considers standing to maintain an appeal, which is, of course, irrelevant for present purposes. Neither party raised at DOAH the issue of whether the other party was substantially affected, but the court stated that standing in an administrative proceeding is a question of subject matter jurisdiction and, thus, may not be conferred by the parties.31/ Id. at 651 n.2.
The Abbott Labs opinion determines that the effect of a rule in maintaining a generic drug in the Negative Drug Formulary, which denies the manufacturer of a greater opportunity to make sales at the expense of an existing brand name drug, is a direct injury in fact of sufficient immediacy and reality to grant the challenger access to a rule challenge proceeding. The court determined that the intervenor was also
substantially affected. As the manufacturer of the brand name drug, the intervenor claimed the mirror image of the injury claimed by the challenger--injury if the rule was invalidated and the generic drug could takes sales from the intervenor's brand name drug.
The intervenor's claim was more visible because it represented a loss of existing revenues while the challenger's claim represented a loss of anticipated revenues, but both injuries were identical in amount and probability due to the zero-sum nature of the dispute. Abbott Labs thus demonstrates how impacts to existing and future revenues may be equally real and immediate.
The Abbott Labs court also concluded that the interests of both parties were within the zone of interests regulated by the enabling statutes and challenged rule. Id. at 651. This conclusion seems indisputable.
In the most recent case to address access to a rule challenge, Office of Insurance Regulation v. Secure Enterprises, L.L.C., 124 So. 3d 332 (Fla. 1st DCA 2013), the agency issued a rule, as a form, for use by insurers to provide premium discounts for homeowners who installed certain wind-mitigation fixtures. The challenger manufactured a fixture that strengthened the wind resistivity of garage doors. The challenger claimed that the form's omission of a discount for
such fixtures contravened the implemented statute, which mandated the inclusion of such a discount.
The Administrative Law Judge determined that the challenger was substantially affected. Reversing, a majority of the court32/ cited the two-prong test of Jacoby and Lanoue, supra, using the Televisual formulation of the zone-of-interest prong.
As for injury in fact, the Secure Enterprises court acknowledged that an economic injury may suffice, but distinguished the cases relied upon by the Administrative Law Judge. Abbott Labs and Dental Hygienist raised issues of economic competition, which the Secure Enterprises court determined was inapplicable in the case before it.
The Secure Enterprises challenger claimed economic harm from the absence of a policy discount that homeowners had never previously received. The court noted: "Had this been a situation where OIR eliminated an existing insurance credit for garage doors, [the challenger]'s injury in fact argument would be much stronger." Id. at 339. The Secure Enterprises court stated that the economic harm in Abbott Labs was from "allowing a generic drug to enter the market." Id. at 338. Actually,
this states the economic harm of the Abbott Labs intervenor,
which claimed the more visible economic injury from the prospect of lost revenues from the entry into the market of the
challenger's generic drug; the intervenor, not the challenger, faced the loss of a present economic advantage. Raising the mirror image of the intervenor's claim, the Abbott Labs
challenger claimed less-visible, but identical economic injury from the prospect of being unable to earn anticipated revenues from the ability of its generic drug to be freely substituted for the intervenor's brand name drug. The challenger's less- visible claim, which necessitated closer scrutiny because, if insufficient, the case would have been dismissed, was identical in this respect to the Secure Enterprises challenger's claim of being unable to earn anticipated revenues from the ability to market its wind-mitigation device with the aid of premium discounts on homeowner's insurance. In Abbott Labs, the challenger's claim of anticipated revenues was a real and sufficiently immediate injury; in Secure Enterprises, it was not.
The Secure Enterprises court stated that it was "reasonable to conclude . . . that allowing . . . less-educated dental hygienists to enter the field of hygienists in Florida would result in economic harm to . . . dental hygienists currently working in the state." Id. at 338-39. This may be true, but the court does not compare the five links necessary to connect the rule to the injury in Dental Hygienist to the two
links in Secure Enterprises.33/ The causal chain between the challenged rule and the injury was much shorter and clearer in Secure Enterprises than in Dental Hygienist.
Analysis of specific injuries and the causal link between them and the rules is unfortunately displaced by the characterization of the injuries in Abbott Labs and Dental Hygienist as arising from competitive injury and the injury in Secure Enterprises as not.
Even in terms of labels, it is unclear whether, in distinguishing Abbott Labs and Dental Hygienist, the court intended to suggest that economic harm was only cognizable if expressed in the form of impacts to competition. Obviously, anti-competitive interests can be an important source of economic harm, as reflect by these cases and the professional encroachment cases, such as FMA. But forms of economic harm not resting on competition were sufficient in Alice P. (physician), Professional Firefighters, All Risk (self-insurer), Montgomery, Ward, and, of course, Televisual.
Turning to the Administrative Law Judge's reliance on Televisual, the Secure Enterprises court stated that the Administrative Law Judge had noted the court's determination that the president's testimony of a potential doubling in sales as not speculative. The Secure Enterprises opinion cautioned, though, that the Televisual holding was also based on the fact
that the challenged rules collaterally regulated the education video production industry. Id. at 339.
Strictly speaking, health care providers are regulated by rules predicating their licensing or registration on meeting continuing-education requirements; video producers are not regulated by such rules. In the same vein, optometrists are regulated by rules allowing them to prescribe legend drugs; physicians are not regulated by such rules. And insurers are regulated by rules stating that rate filings showing the premium discounts stated in the form will be approved; manufacturers of wind-mitigation devices are not regulated by such rules. After close analysis of the subject rules, the claimed injuries, and the causal links between the rules and the injuries, it is possible to find that the unregulated parties may be substantially affected by these rules. It is harmless to label such parties as collaterally regulated, but it is regrettable when the label supplants the analysis.
As already noted, the challenger in Televisual was collaterally regulated. The challenger in Secure Enterprises
was cast with the challengers in All Risk as not being collaterally regulated.
Additionally, the Secure Enterprises opinion rejects as speculative the Administrative Law Judge's finding that injury in fact may be "inferred" from the "likelihood" that an
annual premium discount for a one-time purchase of the challenger's inexpensive fixture would increase sales, and thus the absence of such a discount would "likely cause" economic injury. Id. This portion of the opinion seems to imply that findings reflective of any degree of probability between the effect of the rule and the claimed injury necessitates a conclusion that the claim of injury is remote and speculative. In the language of the opinion: "These findings confirm that [the challenger] failed to show that the rules and forms at issue have resulted in a 'real or immediate' injury in fact sufficient to satisfy the substantially affected test." However, the majority of cases in which the challenger proves injury-in-fact involve injuries that probably ensue from the challenged rule. Probabilities of injuries flowing from challenged rules existed in Professional Firefighters, All Risk (self-insurer), Ward, Televisual, NAACP, Abbott Labs, and, of course, the preeminent case in this line, Dental Hygienist, among other cases.
The Secure Enterprises opinion also concludes that the challenger's interest was not within the zone of interest to be protected by the enabling statute or challenged rule. Id. at 339-40. The court determined that the express purpose of the statute is to require insurers to provide premium discounts to homeowners who install wind-mitigation fixtures, not to increase
the sales of the manufacturers of such devices. Although certain manufacturers may have obtained increased sales from the existence of policy discounts, this was not the type of financial interest that the enabling statute was intended to regulate or protect. The court based its zone-of-interest analysis on Jacoby and Lanoue, and the opinion does not undertake the loosened zone-of-interest test described in FMA
and Ward, nor does it consider the effect of more recent federal decisions, discussed below, on the application of the zone-of- interest test.34/
Regardless of the merits of any tests or bright-line rules that may be found in the case law, the task is always to determine, under the facts of each case, whether the challenger is substantially affected by the challenged rule. The access determination depends on how the Rule impacts Petitioner and Intervenors and whether any impact is substantial. Professor Dore's characterization of this exercise35/ is useful: a challenger is substantially affected if his course of conduct has been acted upon or changed in any significant way by the challenged rule.
Petitioner and Intervenors manufacture and service IIDs, conduct IID programs, and are active members of this industry. Their IIDs meet the requirements of the federal Model Specifications. Each party enjoys substantial Florida
contacts--Petitioner's lone manufacturing plant is in Florida and Intervenors currently operate an IID program under contract with Respondent for much of Florida. Theirs is not an academic or theoretical interest in the Rule or their access to the Florida market. Doubtlessly, Petitioner would be selling and Intervenors would be continuing to sell their IID goods and services in Florida for use by convicted persons, but for the Rule.
For the most part, the economic impacts to Petitioner and Intervenors are the same--the competitive injury recognized in Secure Enterprises. Intervenors are also immediately affected in part by the fact that they are presently providing IID goods and services in the south region of Florida--the "much stronger" case recognized in Secure Enterprises. In this sense, the effect of the Rule on Intervenors is especially pronounced as their ten-year reign as a contracting party with Respondent approaches its conclusion.36/
But Petitioner's injury from the inability to earn revenues is equally real and immediate, if slightly less visible. In Harvey, Televisual, Jacoby, and Abbott Labs, challengers were substantially affected by rules that did not take away an economic advantage that they already had, but prevented them from obtaining an economic benefit that they sought.
As noted above, the Rule's interposing of a contract between Petitioner and Intervenors and the Florida market is the injury. Sharpening the presentation of this injury is that, as things presently stand, the Rule's requirement that IID manufacturers obtain contracts with Respondent means that Intervenors will not be selling IIDs and IID services in Florida for much longer, and neither Petitioner nor Intervenors will be able to sell IIDs and IID services in Florida in the near future.
Intervenor argues that Petitioner and Intervenors are not substantially affected because the Rule does not limit the number of IID manufacturers with which Respondent may contract. Intervenor contends that Petitioner and Intervenors are really complaining of the fact that they did not win the pending RFP award--an injury for which, Intervenor states, a bid protest provides them an adequate remedy. Intervenor points out that, if Respondent had selected Petitioner and Intervenors as contracting parties, they would not have commenced this rule challenge. Intervenor argues that the Rule does not regulate the activities of IID service providers. Intervenor contends that the Rule does not dictate the provisions of any IID contract; Petitioner and Intervenors could have objected to the RFP specifications, but they did not avail themselves of this remedy.
These arguments fail to account for the impact of the interposing of a contract between IID manufacturers and access to the Florida market of convicted persons. As Intervenor argues, the Rule does not limit the number of IID manufacturers with which Respondent may choose to contract, nor does the Rule specify the term or provisions of any contract. But it is the existence of the contracting process itself that injures the interests of Petitioner and Intervenor. Inherent in the right to contract is the right not to contract, and, by the Rule, Respondent reserves to itself the ability to restrict access to the market of providing IID services to Florida's convicted persons.
Illustrative of the operation of the Rule is that, over the past ten years, Respondent has limited its contracting authority to two IID providers for the entire state and presently proposes to limit its contracting authority to only one IID provider to for the entire state for the next five or ten years. This is exactly the kind of application of the Rule that sharpens the presentation of injury among IID manufacturers, although even an application that distributed contracts far more widely among the IID manufacturer community would not deprive all manufacturers of the status of substantially affected persons.
In addition to the injury visited upon IID manufacturers by the unspecified terms of any contracts created under the authority of the Rule, during which time other manufacturers will be foreclosed from selling IIDs and IID services in Florida, the Rule injures manufacturers by the imposition of contract conditions and provisions, which are also unknown until the issuance of the procurement document.
Intervenor's argument that the real complaint of Petitioner and Intervenor is that Respondent did not select them for contracts misses the point that the injury results from the Rule's requirement of a contract. A discrete injury may be suffered by Petitioner and Intervenors when Respondent picked Intervenor as its new contracting party, but this does not obscure the fact that these IID manufacturers suffered a cognizable injury in the Rule's requirement of a contract.
Subsequent events do not reach back to eliminate the injury on which a party may rely to establish that it is substantially affected. Access is a forward-looking concept, not to be confused with prevailing on the merits. In substantial-interests cases, the question is whether, at the outset, the party's substantial interests "could be" affected by the proposed agency action, St. John's Riverkeeper, Inc. v. St. Johns River Water Mgmt. Dist., 54 So. 3d 1051, 1054 (Fla. 5th DCA 2011) (citing Peace River/Manasota Reg'l Water Supply Auth.
v. IMC Phosphates Co., 18 So. 3d 1079, 1084 (Fla. 2d DCA 2009)), or whether, at the outset, the party's substantial interests "could reasonably be affected by the proposed activities." Palm
Beach Cnty. Envtl. Coal. v. Dep't of Envtl. Prot., 14 So. 3d 1076, 1078 (Fla. 4th DCA 2009) (citing Peace River/Manasota, supra at 1084)). Forward-looking decisions on access to rule challenges include Harvey, Professional Firefighters, Montgomery, Cole Vision, and, of course, NAACP.
Intervenor argues that separate administrative remedies are available to challenge the specifications of the RFP and the proposed award. But the availability of such remedies also does not eliminate the injury that results from the Rule's requirement of a contract. The challengers in Harvey and Jacoby were substantially affected even though they were pursuing relief from the adverse factual determinations that the agencies had made in reliance upon the challenged rules. More broadly, in these cases and Professional Firefighters, Montgomery, Cole Vision, and NAACP, the challengers were substantially affected, even though the they had not exhausted all contingencies to determine if the rules applied to them or before they had exhausted all options to comply with or mitigate damage from the rules. The Rule substantially affects Petitioner and Intervenors by interposing the requirement of a contract between them and the Florida market of convicted
persons--without regard to whether they protested the RFP specification or the proposed award and certainly without regard to the outcome of the pending bid protests.
Intervenor's argument that the Rule does not regulate Petitioner and Intervenors invites the application of a bright- line rule in the place of analysis of whether Petitioner and Intervenor are substantially affected. Labels cannot displace analysis. The ultimate question is not whether the Rule regulates Petitioner and Intervenors, but whether they are substantially affected by the Rule. Courts routinely conclude that rules substantially affect unregulated persons in the professional encroachment cases. Other cases recognizing an injury in fact from a rule that does not regulate the challenger include Harvey, Alice P., Montgomery, Lanoue, and NAACP.
Petitioner and Intervenors, like other IID manufacturers, are directly targeted by the Rule. Notwithstanding the fact that they may suffer discrete injuries later when Respondent selects Intervenor for the lone contract, Petitioner and Intervenors establish a real and sufficiently immediate injury in fact, without the need of a long chain of causation, by the Rule's requirement of a contract to sell IIDs and IID services in Florida. For these reasons, Petitioner and Intervenors have suffered a real and sufficiently immediate injury from the Rule and have satisfied the injury-in-fact test.
Intervenor argues that Petitioner and Intervenors are not within the zone of interest of the enabling statutes. Focusing on section 316.1938, Intervenor contends that these certification provisions are for the benefit of the public, not IID providers. Intervenor states that no law guarantees an IID service provider the right to sell its goods or services simply because the breath-testing component of its device has been certified to be accurate.
Perhaps at the time of Matthews and Professional Firefighters, an argument existed that either of the alternative injury-in-fact tests of a real and sufficiently immediate issue or an injury in fact did not constitute all that was required for a person to show that it was substantially affected by a rule.37 When the courts cemented these alternative tests into a single test, this argument became harder to make. Later, as courts analyzed the probabilities of the causal chain linking the challenged rule and the claimed injury, this argument became impossible to make.
There is no margin between a determination that a person is substantially affected by a rule and that the rule has caused the person a real and sufficiently immediate injury in fact. Perhaps this fact explains why the court in seven cases38/ determined the existence of an injury in fact and, without determining whether the zone-of-interest test was satisfied,
concluded that the challenger was substantially affected by the rule.
Because the injury-in-fact test is sufficient to determine whether a challenger is substantially affected by a rule, the zone-of-interest test is useless, at best. At worst, the zone-of-interest test imposes access requirements not authorized by statute. Issues such as the "nature" of a challenger's injury or whether its injury is within the zone of interest of some authority are irrelevant once the challenger has demonstrated that the Rule has caused the challenger a real and sufficiently immediate injury in fact. At this point, though, the zone-of-interest test is sufficiently embedded in Florida case law that the force to dislodge it must come from elsewhere, not an Administrative Law Judge.39/
It is hard to identify the prevailing zone-of- interest test in Florida rule challenges. As noted in the discussion of the cases, the first two cases to apply the zone- of-interest test were FMA and Ward. Because the challengers in these cases would have failed the zone-of-interest test as conventionally formulated, these courts reformulated the test to allow recognition of an injured interest within the zone of interest of any statute. Two cases applied the zone-of-interest test as conventionally formulated: Lanoue and Abbott Labs. In at least two cases--Cosmetic Surgery and Jacoby--it is
impossible to be sure that the court is applying a zone-of- interest test and, if so, which one.
Actually, when analyzed on the basis of specific courts, there is less disagreement about which of these tests applies. Most importantly, the Florida Supreme Court did not apply either version of the zone-of-interest test in NAACP. The Fourth District has applied only the loosened version of the zone-of-interest test, as reflected in Ward. The remaining rule challenge cases are from the First District, which has used both versions of the test and, often, neither version of the test. A recent rule challenge case, Department of Financial Services v. Peter R. Brown Construction, Inc., 108 So. 3d 723 (Fla. 1st DCA 2013), decided by a panel of the Fifth District sitting as temporary judges of the First District, succinctly disposed of the access standing issue, reminiscent of Harvey and NAACP, by concluding that a general contractor was substantially affected when its pay request was denied in reliance on a rule limiting public expenditures for certain decorative items. The court never mentioned either the injury-in-fact or the zone-of- interest test.
The zone-of-interest test has not played much of a role in the reported cases.40/ Not surprisingly, the courts have thus developed little guidance for the application of the test. All courts agree that the legal authority generating the zone of
interest may consist of statutes. The occasional reference to constitutional authority is a throw-back to the federal source of the zone-of-interest test and is irrelevant to administrative litigation. Four courts extend the source of legal authority to rules: All Risk, Lanoue, AIU, and Abbott Labs. Not a rule challenge case, Agrico also incorporates rules in its second prong.
If Florida courts continue to apply the zone-of- interest test, its application should continue to be guided by federal cases, from which the test was borrowed. A recent United States Supreme Court case lists some guidelines that have arisen in the 40 years since Data Processing.
In Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v. Patchak, U.S. , 132 S. Ct. 2199 (2012), the Supreme Court applied the zone-of-interest test for standing under the federal Administrative Procedure Act. The Secretary of the Interior had acquired land in trust for an Indian band to use for gaming purposes. A nearby resident filed suit against the Secretary under the Administrative Procedure Act, seeking divestment of the land on the ground that it had been acquired illegally. The Indian band intervened to defend the Secretary. The District Court dismissed the action on the ground that the plaintiff lacked standing under the zone-of-interest test. The
Circuit Court reversed, and the Supreme Court affirmed the decision of the Circuit Court.
The statute in question authorizes the Secretary to acquire land for Indians. The plaintiff alleged economic, environmental, and aesthetic harms from the Indian band's plan to operate a casino on nearby land.
The Indian band and Secretary argued that the plaintiff's interests related to the use of the land, and the statute in question focuses on land acquisition. Rejecting this argument, the Court noted that the zone-of-interest test "'is not meant to be especially demanding. (Citation omitted.)'" Id. at 2210. The Court stated that courts apply the test to determine whether the interest asserted by a plaintiff is "'arguably within the zone of interests to be protected or regulated by the statute' that he says was violated. [Data Processing, supra.]" Id. The test uses "arguably" to "indicate that the benefit of any doubt goes to the plaintiff." Id. The purpose of the zone-of-interest test is to preclude a legal action "only when a plaintiff's 'interests are so marginally related to or inconsistent with the purposes implicit in the statute that it cannot reasonably be presumed that Congress intended to permit the suit. (Citation omitted.)'" Id.
The Court conceded that the subject statute did not seek to benefit the plaintiff, but the issue was whether land
use considerations arguably fall within the scope of the statute. If so, a neighbor complaining about land use would be permitted to enforce the statute's limits. Id. n.7. The Court determined that the subject statute, even though it is limited to land acquisition, attempts to rehabilitate Indians' economic life. Because land forms the basis of this economic life in terms of tourism, mining, manufacturing, logging, and gaming, land use interests arguably fall within the scope of the statute.
Although not a permitting case, Pottawatomi Indians
is a third-party access case: the Secretary was acquiring land for Indians, and a nearby landowner objected. Even in such a case, for which the zone-of-interest test is better suited, these principles applied to limit the effect of the test: the test is undemanding, the benefit of any doubt goes to the third party challenger, and the challenger is denied access only when its interests are so marginally related to or inconsistent with the purposes of the statute that the court cannot reasonably infer that Congress intended to permit the challenge.
More recent federal decisions considering the zone- of-interest test include Patel v. U.S. Citizenship and
Immigration Services, 732 F.3d 633, 636 (6th Cir. 2013) (Immigration and Naturalization Act provision reflects compromise among various purposes to protect U.S. workers, U.S.
employers, and qualified immigrants, such as the plaintiff); O'Brien v. Department of Health and Human Services, 894 F. Supp. 2d 1149, 1167-68 (E.D. Mo. 2012) (zone-of-interest test does not require showing of Congressional intent to benefit plaintiff, but requires only that an "asserted interest [have] a 'plausible relationship' to a general policy implicit in a relevant statute. (Citation omitted.)"); Association of Public Agency
Customers v. Bonneville Power Administration, 733 F.3d 939, 954 (9th Cir. 2013) ("'all that is required is a rough correspondence of the plaintiff's interests with the statutory purpose.' (Citation omitted.)"; Groceries Manufacturers Association v. EPA, 693 F.3d 169, 179 (D.C. Cir. 2012) (interest to be protected must be within the zone of interests regulated or protected by the statute in question or by any provision integrally related to it).
Construed in light of these federal decisions, the zone-of-interest test is met in this case. The Rule provides for the means by which IID manufacturers and service providers will market their goods and services to convicted persons and at the same time conform to the regulatory requirements of the IID program. The interest of Petitioner and Intervenors is to market their IID goods and services to convicted persons, so their interest is clearly within the zone of interest of the Rule.
Section 316.1938 and other provisions of chapter 15A-
9 provide for the certification of IIDs by Respondent. IID certification is a crucial precondition of marketing IID goods and services to convicted persons. It is also the ultimate precondition, if the Rule is invalid, or the penultimate precondition, if it is not. The sole purpose of a manufacturer's obtaining certification is marketing, if the Rule is invalid, or eligibility for contracting, if it is not. Under the federal case law, the interest of Petitioner and Intervenors to market their IIDs and IID services to Florida convicted persons roughly corresponds with and is plausibly related to the purpose of the certification statute because certification is a precondition to the sale and use of IIDs.
Intervenor's argument that the enabling legislation is for the benefit of the public, not IID manufacturers, may find support in Secure Enterprises, but is inconsistent with the instruction of Pottawatomi Indians. The proper question is not whether the Rule and section 316.1938 exist to benefit Petitioner and Intervenors, although the certification provisions of section 316.1938 and other rule provisions benefit Petitioner and Intervenors by ensuring the demonstrated reliability of their IIDs and IID programs, so as to permit their use in DUI programs in Florida. The proper question is whether the provision of IIDs and IID services to convicted
persons arguably falls within the scope of the rules and statute. Obviously, it does, even without giving Petitioner and Intervenors the benefit of every doubt.
To accept Intervenor's zone-of-interest argument is to find that Petitioner and Intervenors' interests are so marginally related to or inconsistent with the purposes of the Rule and statute that one could not reasonably infer that the legislature intended to permit them to challenge the Rule. And that inference is unreasonable. To the contrary, the interests of Petitioner and Intervenors have a plausible relationship to the policy implicit in the Rule and statute to shape the contours of an IID program delivered by IID manufacturers and service providers to convicted persons. Petitioner and Intervenors' interests bear more than the required rough correspondence to this purpose of the Rule and statute. For these reasons, the injured interests of Petitioner and Intervenors are within the zone of interest of the Rule, chapter 15A-9, and section 316.1938, using the conventionally formulated zone-of-interest test.41/
Turning to the merits, Petitioner and Intervenors bear the burden of proving by a preponderance of the evidence that the Rule is an invalid exercise of delegated legislative authority. § 120.56(1) and (3)(a), Fla. Stat.
The Rule is invalid if Respondent has exceeded its grant of rulemaking authority, the Rule enlarges, modifies or contravenes the law implemented, or the Rule vests unbridled discretion in Respondent. § 120.52(8)(b), (c), and (d).
The Rule is invalid on all three grounds cited.
Essentially, Respondent has self-authorized a process by which it grants franchises--or, a single franchise--for the operation of IID programs--or, a single IID program--throughout Florida. Respondent's approach to discharging its mandate to certify IIDs and monitor IID programs has been to interpose the requirement of a contract between an IID service provider and convicted persons. The reasonableness of Respondent's approach is not at issue in this case. Perhaps, interposing a contract between IID manufacturers and service providers and convicted persons is the best way for Respondent to discharge its statutory responsibilities and pursue such laudable goals as ensuring that rural parts of the state are guaranteed IID programs, but these factors are irrelevant for present purposes.
The issue generally is whether the legislature has chosen this approach or delegated to Respondent the responsibility for choosing this approach. It clearly has not.
Respondent has exceeded its grant of rulemaking authority in adopting the Rule. Agencies operate under specific limitations on rulemaking authority:
No agency shall have authority to adopt a rule only because it is reasonably related to the purpose of the enabling legislation
. . .. Statutory language granting rulemaking authority or generally describing the powers and functions of an agency shall be construed to extend no further than implementing or interpreting the specific powers and duties conferred by the enabling statute.
§ 120.52(8) (flush language).
Section 120.52(17) defines "rulemaking authority" as: statutory language that explicitly
authorizes or requires an agency to adopt, develop, establish, or otherwise create any statement coming within the definition of the term "rule."
Respondent and Intervenor argue that section 316.193(11) confers the necessary rulemaking authority on Respondent. This provision states: "[Respondent] is directed to adopt rules providing for the implementation of the use of [IIDs]."
Petitioner and Intervenors do not use IIDs; they sell and service them. Convicted persons use IIDs. Section 316.193(11) authorizes Respondent to implement rules governing the use of IIDs by convicted persons and, perhaps, courts and law enforcement officials, but not IID manufacturers. This statute does not even extend rulemaking authority to the means by which users obtain IIDs, as long as the IIDs are properly certified and maintained. In short, this statute covers the
operational elements of an IID program, not the purchase and sale of IIDs themselves.
The case law supports a tightly focused analysis of the limits of rulemaking authority in any statute authorizing rulemaking. For instance, in Peter R. Brown Construction, Inc.,
108 So. 3d 723, 726-27 (Fla. 1st DCA 2013), the statute authorized the Chief Financial Officer to adopt rules to process expenditures; the court held that the Chief Financial Officer lacked the statutory authority to adopt a rule prohibiting public expenditures for decorative items. In Lamar Outdoor
Advertising v. Department of Transportation, 17 So. 3d 799 (Fla. 1st DCA 2009), the statute authorized the agency to administer statutes "related to the size, lighting, and spacing of signs"; the court held that the agency lacked rulemaking authority to adopt a rule as to the height of signs. In Subirats v. Fidelity National Property, 106 So. 3d 997 (Fla. 3d DCA 2013), the statute authorized the agency to adopt by rule a property- insurance mediation program modeled after the practices and procedures of a Supreme Court mediation program; the court held that the agency lacked rulemaking authority to adopt a rule setting a deadline for insurers to give insureds notice of the mediation program.42/
The Rule enlarges, modifies, or contravenes the specific provisions of the law implemented. Agencies operate under specific requirements as to the law implemented by rules:
. . . a specific law to be implemented is
. . . also required. An agency may only adopt rules that implement or interpret the specific powers and duties granted by the enabling statute. No agency shall have authority to adopt a rule only because it is reasonably related to the purpose of the enabling legislation and is not arbitrary and capricious or is within the agency's class of powers and duties, nor shall an agency have the authority to implement statutory provisions setting forth general legislative intent or policy. Statutory language granting rulemaking authority or generally describing the powers and functions of an agency shall be construed to extend no further than implementing or interpreting the specific powers and duties conferred by the enabling statute.
§ 120.52(8) (flush language).
Section 120.52(9) defines "law implemented" as: "the language of the enabling statute being carried out or interpreted by an agency through rulemaking."
Section 316.193 defines the offense of DUI and provides the penalties, including the use of IIDs by convicted persons. This section requires the mandatory placement of an "[IID] approved by [Respondent] in accordance with s. 316.1938." As described below, section 316.1938 deals generally with the certification of the breath-testing component of IIDs, not with contracts between Respondent and IID manufacturers.
Section 316.1937 authorizes a court to prohibit certain convicted persons from operating a motor vehicle unless it is equipped with a "functioning [IID] certified by [Respondent] as provided in s. 316.1938." Section 316.1937 imposes on the court certain duties and lists some prohibitions in connection with the use of an IID, but does not address contracts between Respondent and IID manufacturers.
Section 316.1938(1) provides that Respondent shall certify the "accuracy and precision" of the breath-testing component of IIDs, publish a list of approved devices, and publish rules governing the accuracy and precision of the
breath-testing component of IIDs. Section 316.1938(2) prohibits the certification of an IID unless it meets the accuracy requirements specified by Respondent's rules. But nothing in section 316.1938 addresses contracts between Respondent and IID manufacturers.
Model Specifications contains technical specifications to be met by IIDs and does not address contracts between Respondent and IID manufacturers.
Intervenor argue persuasively in their proposed final order that the statutory requirement of publishing a list of approved devices would be meaningless unless manufacturers of approved IIDs were allowed to market them. Intervenors explain that the purpose of the list is to permit convicted persons to
choose among certified IIDs. If Respondent were able to select the manufacturers to be allowed to sell IIDs in Florida, Respondent would not need such a list to identify manufacturers of devices that could lawfully be used in Florida.
Equally important, nothing in these statutes contemplates that Respondent will select the winners, based on criteria unspecified in the law implemented, among the community of IID manufacturers, and only the manufacturers selected by Respondent will be permitted to sell their IIDs in Florida. As Petitioner observes in its proposed final order, the legislature is explicit in its authorization to Respondent to enter into contracts for specific programs, such as for alcohol testing and driver testing. §§ 316.1932(1)(a)2.h. and 322.56(1), Fla. Stat.
In a similar vein, Section 322.292 illustrates the kind of statutory language necessary to authorize Respondent to take the kind of regulatory action that it takes in the Rule. Section 322.292(1) directs Respondent to "license and regulate" all DUI programs. The statute orders Respondent to consult with the chief judge of each judicial circuit and then "establish requirements regarding the number of programs to be offered within a judicial circuit. Such requirements shall address the number of clients currently served in the circuit "
Section 322.292(2) authorizes Respondent to adopt rules to implement its supervisory authority over DUI programs. The
ensuing subsections specify in great detail the matters to be covered by these rules.
By contrast, the Rule implements no law authorizing or directing Respondent to franchise IIDs and IID services in Florida. It is axiomatic that the power to grant franchises rests with the legislature, not the executive branch. See, e.g., Fla. v. Rosenthal, 148 So. 769, 770 (Fla. 1933); Colen v.
Sunhaven Homes, Inc., 98 So. 2d 501 (Fla. 1957). The power to franchise--and disenfranchise--is a particularly visible exercise of legislative authority.
Intervenor claims that agencies have inherent authority to enter into contracts to fulfill the duties imposed on them by statute, as long as they do not expend public funds. The case cited for this principle involves a state commission's signing of a lease for office space from another state commission. Fla. v. Fla. State Improvement Comm'n, 30 So. 2d 97 (Fla. 1947). In this case, the Florida Supreme Court stated: "State agencies generally have authority to contract with each other in so far as necessary to administer duties within the scope of their authority." Id. at 99. This case is distinguishable on the ground that the agency was merely leasing office space, which presumably it was authorized to do--not self-authorizing itself to grant franchises without specific legislative authorization.
Intervenor cites section 487.042(12) and Rule 60A- 1.002, in which the Department of Management Services (DMS) delegates to agencies conditional authority to purchase goods or contractual services. This, too, is inapposite. Respondent does not claim to be exercising legislative authority that has been delegated to another agency, which, in turn, has delegated the authority to Respondent. If the legislature has not authorized Respondent to grant IID franchises, one may assume that it has not authorized DMS to do so.
In Subirats, supra, the court held that a rule imposing a deadline for failing to inform a policyholder of her right to participate in a mediation program enlarged, modified, and contravened a statute requiring an insurer to notify a policyholder of her right to participate in a mediation program. By establishing a simple enforcement mechanism, the rule's departure from the law implemented was slighter than in the present case. Here, leveraging statutes that provide for the certifying of IIDs, the monitoring of IID services, and the supervising of the use of IIDs, Respondent has appointed itself, in the Rule, the keeper of the gate through which IID manufacturers--or a lone IID manufacturer--must pass in order to access the Florida market of convicted persons for such period of time as Respondent chooses. To match Respondent's enlargement of its enabling legislation, the agency in Subirats
would have had to adopt a rule appointing itself the franchisor of mediation programs.
In Board of Trustees of Internal Improvement Trust
Fund v. Day Cruise Association, Inc., 794 So. 2d 696 (Fla. 1st DCA 2001), rev. denied, 823 So. 2d 123 (Fla. 2002), the Trustees proposed a rule that would prohibit the use of sovereign submerged lands for the anchoring of vessels that are engaged in "cruises to nowhere" for offshore gambling. None of the law implemented directed or even authorized the Trustees to regulate only certain vessels from anchoring on the basis of lawful activities on board the vessels once they are on the high seas. Instead, the Trustees were authorized generally to acquire, conserve, manage, and convey the public lands under their jurisdiction. Finding no "specific law to be implemented," the court held that the proposed rule did not implement any enabling legislation. Id. at 704.
The Rule vests unbridled discretion in Respondent.
Respondent candidly admits that the flexibility that it seeks in expressing its regulatory control over IID programs through the template of a contract, rather than rulemaking, is intended to obtain for Respondent more flexibility than it would enjoy through reliance on rules. Not really disagreeing, Intervenors point out in their proposed final order that rules specifying the features of IID programs would give substantially affected
persons a meaningful opportunity for examination and, if necessary, protest, but the same specifications in an RFP would give interested persons only 72 hours to examine and protest the offending provisions, under section 120.57(3). Also, the substantive law governing rule challenges and specifications protests provides greater deference to agency policymaking present in an RFP than that present in rules.
As noted above, the two most obvious elements of agency discretion reserved by the Rule are the number of IID manufacturers that Respondent will allow to access Florida and the term of their franchise or franchises, which could range from months to decades. Other important elements would include provisions for serving low-income convicted persons, training staff, and countless other matters--all left to the discretion of Respondent, if it is allowed to franchise IID service programs under the gentle auspices of the 29-word Rule.
In Federation of Mobile Home Owners v. Florida
Manufactured Housing Association, Inc., 683 So. 2d 586 (Fla. 1st DCA 1996), the agency proposed to repeal rules governing the approval of mobile home park prospectuses. The challenger claimed that the agency was proposing to apply nonrule policy on a case-by-case basis in place of a clearly articulated rule governing such items as the terms of prospectuses and the manner and method of amending them. The court held that the "rule"
(i.e., the repeal of rules) governing the amendment of prospectuses was invalid because it vested unbridled discretion in the agency over the review and approval of amendments to prospectuses. Id. at 591-92.
Federation of Mobile Home Owners illustrates the change in the balance of power between an agency and persons regulated by the agency with the interposing of rules between the parties. Unless the adoption of rules represents a foray into new regulatory territory, the adoption of rules swings the balance in the favor of the regulated community, which is given notice of the principles under which it must operate, adequate time to assess the impact of the principles upon a party's operations or planned operations, a hearing to challenge these principles, and assurance that all competitors will operate under the same principles.
The franchising powers that Respondent has seized by means of the Rule vest unbridled discretion in the agency to pick one or more IID manufacturers to operate IID programs in Florida for an indefinite period of time. It is true that the contracts themselves would presumably impose reciprocal duties on both parties to the contract, and bid-protest proceedings could provide some limitations on Respondent's discretion; perhaps, by these means, Respondent's discretion would be harnessed as to such matters. But Respondent's discretion is
unbridled as to the two questions that the Rule leaves unanswered: to which IID manufacturer or manufacturer will Respondent award a franchise and for how long will Respondent permit the selected manufacturer or manufacturers to hold the franchise?
ORDER
It is ORDERED that Rule 15A-9.006(2) is invalid as an invalid exercise of delegated legislative authority.
DONE AND ORDERED this 10th day of January, 2014, in Tallahassee, Leon County, Florida.
S
ROBERT E. MEALE
Administrative Law Judge
Division of Administrative Hearings The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675
Fax Filing (850) 921-6847 www.doah.state.fl.us
Filed with the Clerk of the Division of Administrative Hearings this 10th day of January, 2014.
ENDNOTES
1/ The Petition also alleges that the Rule is arbitrary and capricious. At the hearing, Petitioner abandoned this claim. Petitioner and Intervenors did not address this claim in their proposed final orders, so this Final Order will not address whether the Rule is arbitrary and capricious.
2/ However, RFP Attachment I.III.A.1, which is the form contract, provides that Respondent, in its sole discretion, may cancel the contract at any time without liability to the vendor.
3/ In Ch. 96-159, § 42, eff. Oct. 1, 1996, the legislature enacted § 120.81, Florida Statutes. Section 120.81(3) exempts prisoners from the definition of "party" for, among other purposes, rule challenges.
4/ Dep't of Offender Rehab. v. Jerry, 353 So. 2d 1230, 1233 (Fla. 1st DCA 1978):
Despite the dissimilarities of the terms ["adversely affected or aggrieved" versus "substantially affected"] under the federal and Florida Acts, decisions involving standing in the federal courts often turn upon issues pertaining to whether a person seeking relief has shown that his interests are substantial and not illusory. The cases have no common thread running throughout and the facts must be analyzed on a case by case basis.9 [n.9 Professor Davis after analyzing the more recent United States Supreme Court opinions concluded that the "dozen efforts (by the Court) to locate the line (between injury and no injury) have produced some seemingly conflicting case law, and all the standing cases of the 1970s have been decided by a divided court." Davis, Administrative Law of the Seventies, Supplementing Administrative Law Treatise 507 (1976).]
5/ "To" is in the quoted material from Sierra Club, supra at 733.
6/ This is the situation in Jacoby v. Bd. Of Med., 917 So. 2d
358 (Fla. 1st DCA 2005), discussed infra, where the board denied the application of an out-of-state physician based on a rule and nonrule policy, but the physician had suffered an injury in fact due to the likelihood of reapplication.
7/ Courts sometimes analyze a case under the second prong of the substantial-interests test in terms of the zone of interest of the substantive statute or rule. See, e.g., Sickon v. School Bd. Of Alachua Cnty., 719 So. 2d 360, 363 n.3 (Fla. 1st DCA 1998); Manasota Osteopathic Gen'l Hosp. v. Dep't of Health & Rehab. Servs., 523 So. 2d 710, 711 (Fla. 1st DCA 1988) (court characterizes second prong of Agrico test as zone-of-interest test).
See also, infra, discussion of dissenting opinion in Internat'l Jai-Alai Players Ass'n v. Fla. Pari-Mutuel Comm., 561 So. 2d 1224, 1226-27 (Fla. 3d DCA 1990) (per curiam) (Ferguson, J., dissenting).
8/ Although the second prong of the substantial-interest test, as discussed infra, can be described as the zone-of-interest prong, the opinion mentions "zone of interest" only in connection with the agency's disposition of a challenge to the water permit.
9/ See Mid-Chattahoochee River Users v. Dep't of Envtl. Prot., 948 So. 2d 794, 797 (Fla. 1st Dist. 2006): "The intent of Agrico was to preclude parties from intervening in a proceeding where those parties' substantial interests are totally unrelated to the issues that are to be resolved in the administrative proceedings. Gregory v. Indian River Cnty, 610 So. 2d 547, 554 (Fla. 1st DCA 1992)."
10/ Agrico's second prong is applied with the same result by federal courts. See, e.g., Am. Independence Mines & Minerals Co. v. U.S. Dep't of Agric., 494 Fed. Appx. 724 (9th Cir. 2012). In this case, a mining company sought judicial review under the National Environmental Policy Act (NEPA) of the agency's plans for a national forest. The mining company claimed that its business interests were intertwined with the environmental interests of NEPA. Disagreeing, the court held that the mining company's resource-development interests were not within the zone of interests of NEPA, which involve environmental protection.
11/ The Final Order in All Risk Corp. v. Dep't of Labor & Empy't. Sec., 1981 Fla. Div. of Admin. Hear. LEXIS 4634 (1981) explains that the service corporations challenged proposed rules imposing surety bond requirements on self-insurers, but never alleged how they were injured in fact by the proposed rules, nor did they allege how any injury they might suffer was within the zone of interest protected or regulated by the challenged proposed rule. The Final Order concludes that the service corporations may not acquire the injuries of their clients, the self-insurers.
12/ The Matthews Corp. opinion unambiguously states these requirements in the alternative. The Professional Firefighters opinion also states these requirements in the alternative, but
not unambiguously. The All Risk Corp. opinion transforms these alternative tests into two requirements, both of which must be met to satisfy the injury-in-fact prong of the substantially- affected-person test.
13/ Professor Dore was critical of the introduction by Florida courts of the zone-of-interest test to rule challenge proceedings. The test had proved problematic for the federal courts using it to abstain from adjudicating constitutional issues. Access to Florida Administrative Proceedings, supra at 977-78. As described infra, though, the federal courts have since developed useful guidelines limiting the effect of the zone-of-interest test, at least as it applies to the federal Administrative Procedure Act.
14/ The first choice eliminates the zone-of-interest prong at once, but the second choice casts doubt on its viability over time. Loosening the requirements of a relationship between the injured interest of the challenger and the challenged rule and its enabling statute may eventually read the zone-of-interest prong out of existence. This problem has been recognized by the federal courts, which allow such a loosened relationship. See, e.g., Grocery Mfrs. Ass'n v. EPA, 693 F.3d 169, 179 (D.C. Cir.
2012) ("But more is required to establish an 'integral relationship' between the statute a petitioner claims is protecting its interests and the statute actually in question; otherwise, 'the zone-of-interests test could be "deprive[d] . .
. of virtually all meaning.['] (Citation omitted.)").
15/ Accord Fla. Optometric Ass'n v. Dep't of Prof'l. Reg., 567 So. 2d 928, 932-33 (Fla. 1st DCA 1990) (optometrists satisfy zone-of-interest prong of substantial-interests test to challenge declaratory statement of Board of Opticianry).
16/ It would not appear that the court was dissuaded from applying the second prong due to its mootness determination; otherwise, under the same reasoning, the court would not have applied the first prong.
17/ Possibly rendering the above-quoted portions of the opinion dictum, the court analyzed the merits of the rule challenge because one of the challengers was the Department of Professional Regulation, which was authorized by statute to challenge the rules of a board.
18/ The majority opinion uses the language of Agrico's second prong rather than the zone-of-interest language. The dissenting opinion notes that a commentator has suggested that the second Agrico test is the zone-of-interest test. Internat'l Jai-Alai, supra at 1227 n.2.
19/ In this case, the Florida Supreme Court noted: "Expansion of public access to the activities of governmental agencies was one of the major legislative purposes of the new Administrative Procedure Act. (Citation omitted.)" Home Builders, supra at 352-53.
20/ The same doubt will reemerge about the continued viability of the zone-of-interest prong of the substantially-affected- person test following another Florida Supreme Court decision 21 years later, as discussed infra.
21/ The Dental Hygienist opinion does not focus on association issues, referring to the challengers alternatively as dental hygienists or the hygienist association, even though the sole challenger was the association. This discussion will follow the court's practice.
22/ The court's attempt to reinforce its injury-in-fact analysis is understandable. The dental hygienists had not specifically pleaded economic injury, so their injuries, in terms of increased competition and loss of value to their education and training, were more remote expressions of economic injury.
The dental hygienists had not suffered professional encroachment, as the concept has been developed in other cases. Here, members of other professions were not encroaching on the responsibilities that had been exclusively reserved to dental hygienists; instead, members of the same profession, but with less education and presumably less qualification, were to be allowed to practice in Florida.
23/ Although not quoted in the Dental Hygienist decision, the court would have found support for its injury-in-fact analysis in Professor Dore's contention that the legislative purposes reflected in the choice of the "substantially affected" language were "served by an access standard that permits any person whose course of conduct is acted on or changed in any significant or important way by an adopted rule to initiate a challenge to the
rule's validity." Access to Florida Administrative Proceedings, supra at 1036.
Professor Dore was especially critical of the importation of the "sufficient immediacy and reality" language from federal ripeness decisions regarding constitutional challenges for controlling access to rule challenge proceedings. Id. at 1041- 42.
24/ The "fully heard" argument does not recur in Florida case law on whether a person is substantially affected by a rule that she is challenging. But compare Abbott Laboratories v. Mylan Pharmaceuticals, Inc., 15 So. 3d 642 (Fla. 1st DCA 2009), which includes a brief discussion of the right of two drug manufacturers to participate in a rule challenge involving whether one's generic drug will be permitted to compete with the other's brand name drug.
25/ Broader than the zone-of-interest prong of the substantially-affected-person test, this test appears to encompass the standing test for challenging the constitutionality of a statute.
26/ See text accompanying endnote 30, infra.
27/ The Administrative Law Judge determined that the challengers were not substantially affected with respect to a rule concerning post-graduate admissions because this injury was too remote, and the challengers abandoned this issue on appeal. Id. at 2.
28/ The focus of the Supreme Court's discussion is on the right of the association to maintain a rule challenge. But any doubt as to the scope of the Supreme Court's holding is dispelled in the first paragraph of the opinion--and reference to the style of the case--in NAACP v. Board of Regents, 876 So. 2d 636 (Fla. 1st DCA 2004), in which the First District takes up the case following remand from the Supreme Court.
29/ See text accompanying endnote 23, supra.
30/ The portion of this test that requires analysis of the impact of the proposed rules on the admission rights of African- Americans applies equally to rules that have long been in effect. The portion of this test that requires analysis of the admission rights of African-Americans before the proposed rule
amendments applies more readily to proposed or newly adopted rules, rather than rules that have long been in effect.
31/ But see Home Builders v. Department of Community Affairs,
585 So. 2d 965, 967-68 (Fla. 1st DCA 1991) (requirement that rule challenger is substantially affected is not jurisdictional). Abbott Labs is the correct holding. To invoke the subject matter jurisdiction of DOAH for a rule challenge, under § 120.56, a person must be substantially affected by the challenged rule.
32/ One judge did not join the majority's determination that the challenger was not substantially affected. Instead, he concurred and joined in the majority's one-sentence determination that the form did not contravene the law implemented. Secure Enter., supra at 340 (Osterhaus, J., concurring).
33/ If a premium discount for an inexpensive wind-mitigation fixtures existed, homeowners would need to decide that they would prefer to spend a couple of hundred dollars to purchase and install the fixture in return for annual premium discounts and added protection for their garage doors, and they would have to choose the challenger's product, which was carried in Lowe's and had little competition.
34/ The Final Order likewise fails to undertake anything but a conventional zone-of-interest analysis and generally fails to provide the injury analysis set forth above.
35/ See endnote 23 supra.
36/ Obviously, Intervenors enjoy their present economic advantage due to the Rule, but, just as there is no election-of- remedies exception to access, as held in Harvey and Jacoby, there is no equitable exception to access. Section 120.56 mandates a threshold assessment of impact, not a fine-tuned weighing of the equities as between an agency that has issued an invalid rule and a challenger that has previously availed itself of benefits under the rule.
37/ However, at no time did the zone-of-interest test facilitate a determination of whether a person was substantially affected by a rule.
38/ These cases are Alice P. (physician and pregnant Medicaid recipient; dictum), Professional Firefighters, All Risk (self insurer; dictum), Montgomery (dictum), Dental Hygienist, Televisual, and Cole Vision. Of course, in NCAA, the Supreme Court did not even identify the zone-of-interest test.
39/ Cf. Hoffman v. Jones, 280 So. 2d 431, 433-34 (Fla. 1973).
40/ No court has determined that a challenger satisfied the injury-in-fact test, but was not substantially affected because it could not satisfy the zone-of-interest test. Secure Enterprises is the only case in which the court concluded that the challenger did not meet the zone-of-interest test, but the court concluded that the challenger did not meet the injury-in- fact test too.
More generally, in only four cases did the court deny access to all challengers: Jerry, Society of Ophthalmology, AIU, and Secure Enterprises. In another three cases, the court denied access to some of the challengers: Alice P., All Risk, and FMA.
41/ Given the applicability of the test to the Rule and law purportedly implemented, there is no need to search for other legal authority as a source of the loosened zone-of-interest test.
42/ Even prior to the 1996 statutory amendments discussed in the case, Respondent's claim of rulemaking authority would have failed. Dep't of Bus. & Prof'l. Reg. v. Calder Race Course, Inc., 724 So. 2d 100, 102 (Fla. 3d DCA 1998) (authorization to adopt rules "for the control, supervision, and direction of all
. . . licensees and for the holding, conducting, and operating of all racetracks" did not authorize a rule authorizing the search of persons and places within a permitted facility).
COPIES FURNISHED:
John M. Lockwood, Esquire The Lockwood Law Firm Suite 810
106 East College Avenue Tallahassee, Florida 32301
John Vincent McCarthy, Esquire Department of Highway Safety and
Motor Vehicles Room A432, MS-02
2900 Apalachee Parkway
Tallahassee, Florida 32399-0504
Frank P. Rainer, Esquire Broad and Cassel
Suite 400
215 South Monroe Street Tallahassee, Florida 32301
David K. Miller, Esquire Broad and Cassel
Suite 400
215 South Monroe Street Tallahassee, Florida 32302
Kelly Overstreet Johnson, Esquire Broad and Cassel
Post Office Drawer 11300 Tallahassee, Florida 32302
Brandice D. Dickson, Esquire Pennington, Moore, Wilkinson,
Bell and Dunbar, P.A.
215 South Monroe Street, Second Floor Post Office Box 10095
Tallahassee, Florida 32302-2095
Liz Cloud, Program Adm. Administrative Code Department of State
R.A. Gray Building, Ste. 101 Tallahassee, Florida 32399 (eServed)
Mr. Ken Plante, Coordinator Joint Admin Proced Committee Room 680, Pepper Building
111 West Madison Street Tallahassee, Florida 32399-1400 (eServed)
Julie L. Jones, Executive Director Department of Highway Safety and
Motor Vehicles
Neil Kirkman Building, Room B-443 2900 Apalachee Parkway
Tallahassee, Florida 32399-0500
Steve Hurm, General Counsel Department of Highway Safety and
Motor Vehicles
Neil Kirkman Building, Room B-432 2900 Apalachee Parkway
Tallahassee, Florida 32399-0500 (eServed)
NOTICE OF RIGHT TO JUDICIAL REVIEW
A party who is adversely affected by this Final Order is entitled to judicial review pursuant to section 120.68, Florida Statutes. Review proceedings are governed by the Florida Rules of Appellate Procedure. Such proceedings are commenced by filing the original notice of administrative appeal with the agency clerk of the Division of Administrative Hearings within
30 days of rendition of the order to be reviewed, and a copy of the notice, accompanied by any filing fees prescribed by law, with the clerk of the District Court of Appeal in the appellate district where the agency maintains its headquarters or where a party resides or as otherwise provided by law.
| Issue Date | Document | Summary |
|---|---|---|
| Jan. 10, 2014 | DOAH Final Order | Rule 15A-9.006(2) is invalid execise of delegated leg authority because of lack of authority, enlarging of law implemented, and vesting unbridled discretion in agency. Mfr of ignition interlock device has standing to challenge rule reqg contracts. |
EMERGENCY EDUCATION INSTITUTE vs BOARD OF NURSING, 13-003685RX (2013)
LABORERS` INTERNATIONAL UNION OF NORTH AMERICA vs. PERC, 13-003685RX (2013)
FLORIDA EDUCATION ASSOCIATION/UNITED, AFT, AFL-CIO vs. DEPARTMENT OF EDUCATION, 13-003685RX (2013)
PHILLIP MOULTRIE vs. DEPARTMENT OF CORRECTIONS, 13-003685RX (2013)
