SCOTUS 22-1008: 6-3 Concurring

A case about the statute of limitations for judicial review of federal agency rule making under the Administrative Procedure Act (interchange fees associated with debit card transactions).

Facts of the Case

The case concerns the interchange fees associated with debit card transactions, which generate billions of dollars in revenue for issuing banks. The regulatory agency, the Board of the Federal Reserve System, promulgated a rule (“Regulation II”) to govern these fees. Regulation II caps the fees that banks can charge for each debit card transaction. Petitioners in the case include Corner Post, a convenience store, the North Dakota Retail Association (NDRA), and the North Dakota Petroleum Marketers Association (NDPMA), all of whom accept debit card payments and are thus affected by interchange fees.

On April 29, 2021, the North Dakota Retail Association (NDRA) and the North Dakota Petroleum Marketers Association (NDPMA) challenged Regulation II as arbitrary and capricious, in violation of the Administrative Procedure Act (APA). After the Board moved to dismiss the case based on the statute of limitations, NDRA and NDPMA amended their complaint to add Corner Post, Inc. as an additional plaintiff. The district court dismissed the case, ruling that the 2015 clarification to Regulation II did not reset the statute of limitations, that Corner Post's statute of limitations began in 2011 with the original publication of Regulation II, and that none of the plaintiffs’ claims warranted equitable tolling. The Merchants appealed, and the U.S. Court of Appeals for the Eighth Circuit affirmed.

Question

Does a plaintiff’s claim under the Administrative Procedure Act “first accrue” under 28 U.S.C. § 2401(a) when an agency issues a rule, or when the rule first causes harm to the plaintiff?

Syllabus

CORNER POST, INC. v. BOARD OF GOVERNORS OF

THE FEDERAL RESERVE SYSTEM

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE EIGHTH CIRCUIT

No. 22–1008. Argued February 20, 2024—Decided July 1, 2024

BARRETT, J., delivered the opinion of the Court, in which in which ROBERTS, C. J., and THOMAS, ALITO, GORSUCH, and KAVANAUGH, JJ., joined.

KAVANAUGH, J., filed a concurring opinion.

JACKSON, J., filed a dissenting opinion, in which SOTOMAYOR, J., and KAGAN, J., joined.

Opinion of the Court Delivered By Barrett

An APA claim does not accrue for purposes of §2401(a)’s 6-year statute of limitations until the plaintiff is injured by final agency action. Because Corner Post filed suit within six years of its injury, §2401(a) did not bar its challenge to Regulation II. We reverse the Eighth Circuit’s judgment to the contrary and remand the case for further proceedings consistent with this opinion.

It is so ordered.

Kavanaugh, Concurring

The Government’s crusade against vacatur would create “strange and even absurd consequences.” Sohoni, The Past and Future of Universal Vacatur, 133 Yale L. J., at 2340. In this opinion, I have described one such consequence: It would leave unregulated plaintiffs like Corner Post without a remedy in APA challenges to agency rules. The Government’s position therefore would fundamentally reshape administrative law, leaving administrative agencies with extraordinary new power to issue rules free from potential suits by unregulated but adversely affected parties—businesses, environmental plaintiffs, workers, the list goes on. I agree with the longstanding consensus—a consensus based on text, history, precedent, and common sense—that vacatur is an appropriate remedy when a federal court holds that an agency rule is unlawful. Because vacatur remains an available remedy under the APA, Corner Post can obtain meaningful relief if it prevails in this lawsuit.

Jackson Dissenting with Sotomayor, Kagan, Joining

At the end of a momentous Term, this much is clear: The tsunami of lawsuits against agencies that the Court’s holdings in this case and Loper Bright have authorized has the potential to devastate the functioning of the Federal Government. Even more to the present point, that result simply cannot be what Congress intended when it enacted legislation that stood up and funded federal agencies and vested them with authority to set the ground rules for the individuals and entities that participate in the our economy and our society. It is utterly inconceivable that §2401(a)’s statute of limitations was meant to permit fresh attacks on settled regulations from all new comers forever. Yet, that is what the majority holds today. But Congress still has a chance to address this absurdity and forestall the coming chaos. It can opt to correct this Court’s mistake by clarifying that the statutes it enacts are designed to facilitate the functioning of agencies, not to hobble them. In particular, Congress can amend §2401(a), or enact a specific review provision for APA claims, to state explicitly what any such rule must mean if it is to operate as a limitations period in this context: Regulated entities have six years from the date of the agency action to bring a lawsuit seeking to have it changed or invalidated; after that, facial challenges must end. By doing this, Congress can make clear that lawsuits bringing facial claims against agencies are not personal attack vehicles for new entities created just for that purpose. So, while the Court has made a mess of this pivotal statute, and the consequences are profound, “the ball is in Congress’ court.” Ledbetter v. Goodyear Tire & Rubber Co., 550 U. S. 618, 661 (2007) (Ginsburg, J., dissenting).