State of Texas v. EEOC

Texas filed suit seeking a declaration that an Enforcement Guidance document from the EEOC regarding the hiring of persons with criminal backgrounds violates the Administrative Procedure Act (APA), 5 U.S.C. 701–06. On appeal, the State challenged the district court’s order dismissing the action under FRCP 12(b)(1) for lack of subject matter jurisdiction. The court concluded that Texas has constitutional standing to challenge the Enforcement Guidance under the APA where Texas is an object of the Guidance and, taking the complaint’s allegations as true, has alleged a sufficient injury in fact - the Guidance forces Texas to alter its hiring policies or incur significant costs; the “flexible” and “pragmatic” approach to assessing the finality of agency action, leads to the conclusion that the Guidance is “final agency action” under section 704 of the APA; the EEOC erred in relying on AT&T Co. v. Equal Employment Opportunity Commission to suggest that agency actions are “final” under the APA only when federal courts are later bound to give deference to the agency’s interpretation of the statute at issue; and it is also sufficient that the Enforcement Guidance has the immediate effect of altering the rights and obligations of the “regulated community” by offering them a detailed and conclusive means to avoid an adverse EEOC finding, and, by extension, agency referral and a government-backed enforcement action. The Guidance is an agency determination in its final form and is applicable to all employers nation-wide; it is not an intermediate step in a specific enforcement action that may or may not lead to concrete injury. Because the district court erred in dismissing this action on justiciability and subject matter jurisdiction grounds, the court reversed and remanded. View "State of Texas v. EEOC" on Justia Law