RAYMOND J. DONOVAN, SECRETARY OF LABOR, ET AL., APPLICANTS v. INTERNATIONAL LADIES' GARMENT WORKERS' UNION, ET AL. A-931 In The Supreme Court Of The United States October Term, 1983 Application For Stay Pending Appeal To The United States Court of Appeals For The District of Columbia Circuit Application For Stay Pending Appeal To The United States Court of Appeals For The District of Columbia Circuit Pursuant to Rules 43 and 44 of this Court and the All Writs Act, 28 U.S.C. 1651, the Solicitor General, on behalf of Raymond J. Donovan, Secretary of Labor, et al., applies for a stay pending appeal of the district court's order entered on May 8, 1984. This case involves an emergency temporary rule issued by the Secretary of Labor in the aftermath of a decision by the court of appeals vacating an earlier permanent rule that permitted persons in the knitted outerwear industry to work at home. That earlier rule was vacated on the ground that the Secretary had not adequately articulated its basis and purpose. Rather than seek further review of the decision vacating that rule in this Court, the Secretary, on remand, initiated a new notice and comment rulemaking procedure, and simultaneously sought to prevent needless disruption to the livelihood of persons now lawfully working in this industry at home by issuing this emergency rule. The rule temporarily suspends for 120 days the ban on homework in the knitted outerwear industry, and applies only to workers who were employed as home knitters during the 29 month period before the Secretary's original rescission of the homework ban was struck down by the court of appeals. The district court vacated the emergency rule, finding it in violation of the prior court of appeals mandate, issued when that court struck down the Secretary's original rescission as inadequately reasoned and explained. In addition, the district court held the emergency rule invalid because it was not issued pursuant to public notice and comment procedures. The Secretary filed a notice of appeal from the district court decision on May 8, 1984. The district court stayed its order reimposing the homework ban until May 15, 1984, but, on May 15, 1984 the court of appeals denied the Secretary's motion for a stay pending appeal. We submit that this Court should grant a stay pending appeal in the court of appeals. A stay is vital to permit orderly processes of regulatory decisionmaking to take their course without abrupt reversals that would irreparably injure the very individuals for whose benefit this regulatory program was enacted. The Secretary's final rule of October 1981 was invalidated by the court of appeals solely because of inadequacies in the statement of basis and purpose. The Secretary has set about, on the most expeditious possible basis, to correct those inadequacies. It it within his authority to suspend the homework ban and maintain the status quo pending completion of that proceeding, as this Court recently held in closely analogous circumstances. Motor Vehicle Manufacturers' Association v. State Farm Mutual Automobile Insurance Co., No. 82-354 (June 24, 1983), slip op. 19 n.15, 26 n.21. Perhaps most important, without a stay pending appeal, the ban on homework in the knitted outerwear industry will be reinstated at once, causing homeworkers to lose their jobs immediately. It defies common sense to inflict this needless and irreparable injury on members of the public, where the Secretary's temporary suspension (of about 70 more days) would, as the district court found, cause no appreciable injury to those challenging the Secretary's actions. 1. a. The Fair Labor Standards Act (FLSA) (29 U.S.C. 201 et seq.) provides that the Secretary of Labor may regulate, restrict, or prohibit industrial homework as necessary or appropriate "to prevent the circumvention or evasion of and to safeguard the minimum wage rate prescribed in this Act." 29 U.S.C. 211(d). Under this authority, in the 1940's, the Secretary issued regulations restricting the employment of industrial homeworkers in seven industries, including the knitted outerwear industry. Homework was, and continues to be, permitted in all other industries. In October 1981, following notice and extensive public comment and hearings, the Secretary rescinded the restriction on homework in the knitted outerwear industry. See 46 Fed. Reg. 50348. After issuance of this new rule, respondents International Ladies Garment Workers Union, et al., filed suit in the United States District Court for the District of Columbia, seeking an injunction against rescission of the homework ban. Respondents contended that the rule was contrary to statute and had been issued in violation of the Administrative Procedure Act (APA). No injunction pendente lite against the new rule was ever issued, and homework was therefore permitted in the knitted outerwear industry throughout this litigation. During that period, individuals made investments and entered the business. Several such individual homeworkers and others intervened in district court in support of the Secretary's decision. The district court upheld the rule permitting homework in July 1982 (Attachment N), and respondents appealed. On November 29, 1983, the court of appeals reversed the judgment of the district court and vacated the Secretary's action. ILGWU v. Donovan, 722 F.2d 795 (D.C. Cir. 1983) (Attachment M). The court of appeals held that the Secretary had failed to articulate whether and how he had considered certain alternatives to a full rescission, and had not adequately justified his action on the basis of the record evidence. The judgment of the court of appeals (Attachment L) vacated the rule and remanded the matter to the district court with instructions to remand to the Secretary for further proceedings as warranted. On February 1, 1984, the court of appeals denied the intervenors' petition for rehearing (Attachment K). The government sought a stay in the court of appeals of that court's mandate, pending decision by the Solicitor General whether to file a petition for a writ of certiorari. The court of appeals denied the motion (Attachment J). The Chief Justice thereafter also denied a motion filed by the intervenors (but not by the government) to stay issuance of the mandate (Attachment I). /1/ On March 13, 1984, the district court remanded the matter to the Secretary "for further proceedings as may be warranted" (Attachment H). b. In accordance with the remand and the court of appeals decision, the Secretary published a Notice of Proposed Rulemaking on March 27, 1984, proposing a new permanent rescission of the ban on homework in the knitted outerwear industry and soliciting comments on the proposal, as well as on various alternatives. 49 Fed. Reg. 11786 (Attachment F). The purpose of this new rulemaking proceeding was to address the issues identified by the court of appeals. The Secretary received petitions and affidavits (Attachment G) filed on behalf of homeworkers requesting an emergency rule permitting them to continue working in their homes pending completion of the permanent rulemaking proceedings. See 49 Fed. Reg. 11792. The homeworkers pointed out that in the absence of an emergency suspension, they would irreparably lose the only form of employment available to many of them during the period before a rescission could be reinstated, and that some businesses forced to cease operations in the interim might find it impracticable to start up again. Id. at 11793. Accordingly, simultaneously with his notice of proposed rulemaking, the Secretary published an emergency final rule suspending the homework ban, effective immediately, for at most 120 days in order to prevent the irreparable harm -- loss of jobs and income by homeworkers -- that would otherwise occur while the new rulemaking proceeding takes place (Attachment E; 49 Fed. Reg. 11792). This temporary suspension was applicable only to those persons employed as homeworkers during the 29-month period when homework had been permitted. Ibid. The Secretary found that there was "good cause" under the APA (5 U.S.C. 553(b)(B) and 553(d)(3)) to publish the temporary suspension without notice and comment or a delayed effective date, because of the irreparable injury that would occur absent immediate action. Additionally, he found that a delayed effective date was not required under 5 U.S.C. 553(d)(1) because the suspension "relieves a restriction" within the meaning of that section. 49 Fed. Reg. 11796. The Secretary further found the emergency action appropriate because, based on evidence not available during the original rulemaking, he determined that the agency could adequately enforce the FLSA in the knitted outerwear industry for the 120 day period at issue and for the limited number of persons covered by the suspension. During the previous two years in which homework was lawful in this industry, the Labor Department had found that, for investigated firms, the FLSA compliance rate for homeworking in the knitted outerwear industry was substantially the same as it was for all industries subject to the FLSA. See 49 Fed. Reg. 11794. Further, since the 1981 rescission of the ban on homework, the Department had increased its enforcement efforts with respect to homeworking by 1,900% over the efforts of the several years prior to 1981. Id. at 11794. c. Following the Secretary's announcement of the emergency suspension, respondents filed a Motion to Compel Compliance in the district court. They argued that the Secretary's emergency rule was inconsistent with the court of appeals' mandate. The court treated the motion as a request for a preliminary injunction, and denied it on April 11, 1984 (Attachment D). While observing that respondents would probably prevail on the merits, the district court held that they had demonstrated no irreparable injury from the Secretary's action. Slip op. 4. d. Rspondents moved in the court of appeals for an order compelling compliance with the mandate, and alternatively appealed from the district court's decision. On April 30, 1984, the court of appeals remanded the matter to the district court (Attachment C). In its remand order, the court of appeals held that the district court had erred in treating respondents' motion to enforce the mandate as a request for a preliminary injunction. The court of appeals held that the district court should rule in the first instance on whether the Secretary had violated the mandate. Nonetheless, the court of appeals noted in dictum that, in the absence of further evidence, it agreed with the district court's tentative conclusion that the Secretary's action was inconsistent with the mandate. Slip op. 6. e. On May 8, 1984, the district court issued an order (Attachment B) invalidating the Secretary's emergency rule and requiring that the Secretary rescind that rule. The court further required that the ban on homework "be continued in full force and effect, unless and until modified as a result of reasoned decisionmaking, after notice and comment." The district court held that the Secretary had erred by issuing the temporary suspension without prior notice and comment because such action was inconsistent with the requirement of "reasoned decisionmaking." Slip op. 3. Even had there been such procedures, the court held, the suspension was in violation of the mandate. Ibid. The district court concluded that it need not reach the question of irreparable injury to the parties involved because the rationale for the emergency rule was not "materially different" from that given to support the government's earlier motion in the court of appeals for a stay of mandate. Slip op. 4-5. The court also found that the reasoning for the emergency rule had already been rejected by the court of appeals. Id. at 5. The court lastly rejected the Secretary's finding of good cause, in part because it predicted that the temporary rule would have to remain in effect for well beyond its 120 day duration. Id. at 6. The district court nevertheless found that "it would be imprudent" not to give the government one week (until close of business on May 15, 1984) in order to seek a stay from the court of appeals. Slip op. 7. On the afternoon of May 8, 1984, the government filed a notice of appeal from the district court's order, and on May 9 sought a stay pending appeal. The D.C. Circuit denied the stay on May 15, 1984 (Attachment A). 2. Rules 43 and 44 of the Rules of this Court and the All Writs Act, 28 U.S.C. 1651, authorize this Court or any Justice to stay a district court order pending appeal to the court of appeals. See, e.g., Smith v. United States, 423 U.S. 1303 (1975) (Douglas, Circuit Justice); Republican State Central Committee v. Ripon Society, Inc., 409 U.S. 1222, 1227 (1972) (Rehnquist, Circuit Justice). In considering such stay applications, this Court weighs three basic factors: (1) the probability that the order of the district court is in error; (2) the irreparable injury that may occur in the absence of a stay; and (3) the public interests that may be affected by operation of the injunction. See id. at 1224; O'Brien v. Brown, 409 U.S. 1, 3 (1972). Application of these standards to this case strongly supports issuance of a stay. a. Irreparable injury. The balance of equities plainly favors a stay of the district court's order pending further review. As the Secretary's emergency rule notes (Attachment E, 49 Fed. Reg. 11793) and the petitions and affidavits from homeworkers (Attachment G) establish, if the homework ban is reinstated at this time, individuals now gainfully employed knitting in their homes will lose their jobs immediately. For many, there is no other work available unless they are willing to leave their children or other dependents and look for work outside the home -- assuming it is available at all. In addition, a sudden reimposition of the homework ban will cause some homeworkers to lose investments they have made during the 29 month period when homework was legal. See Guetti, Hon, Van Alstyne, and Pudvah affidavits (Attachment G). Some homeworkers may lost their jobs permanently because some home employers may be unwilling or unable to sustain the costs of ceasing operations and then starting up again, even if the homework ban is lifted only several months after it had been reimposed by the district court's order. See 49 Fed. Reg. 11793. Furthermore, if the Secretary permanently rescinds the homework ban in this industry in July 1984, all of this injury will have been totally unnecessary. /2/ On the opposing side, respondents have never attempted to show an injury caused by a 120-day suspension (over 40 days of which have already lapsed) covering the limited number of home knitters already so employed. Indeed, the district court refused to issue a preliminary injunction several weeks ago precisely because respondents had shown no irreparable injury of any kind. A showing of injury by respondents at this stage would be quite difficult because they never obtained an injunction against home knitting during the more than two years of litigation covering the original rescission. Moreover, a demonstration of harm would be hard because the Department of Labor has identified only some 474 home knitters, while there are over 60,000 workers employed within the industry. See 49 Fed. Reg. 11793. The employment at home of this small group for less than three more months is hardly likely to cause perceptible damage to respondents, and none has been identified to date. /3/ This is especially true in light of the greatly increased enforcement resources the Secretary has committed to this area. See Attachment E; 49 Fed. Reg. 11794. The practical consequences for the people affected by the district court's order, if it is not stayed, would be harsh and unreasonable -- arbitrary and capricious, in the original, undiluted sense of the words. Their government determined, in October 1981, that they could pursue their livelihood of knitting in their homes, where they could tend to their other family responsibilities and where they could earn a living without having to travel to a distant town or work in a factory setting. As their affidavits show, some of them made investments and other significant decisions in response to this government action. On judicial review, the court of appeals (reversing the district court) concluded that the Secretary's stated reasons for permitting the homework were insufficient. The Secretary is now reexamining the issue. He may well decide -- and nothing in the court of appeals opinion precludes it -- that homework should be permitted again, upon fuller consideration of evidence and alternatives than he provided the first time. Given that possibility, and the total absence of any serious injury to anyone from a brief suspension, it is senseless to put these individuals out of work for the short period of time it will take for the final rulemaking to be completed. b. The public interest. The public interest in this matter is in orderly regulatory decisionmaking. When a court invalidates a rule for procedural defects, the agency has an opportunity to correct its errors and, subject again to judicial review, to promulgate a new rule reaching the same or a similar result. See Center for Science in the Public Interest v. Regan, 727 F.2d 1161, 1164 (D.C. Cir. 1984) ("we begin with the established proposition that it is not improper for an agency to engage in new rulemaking to supersede defective rulemaking"). /4/ In such situations, however, the public interest demands that the affected public be spared the expense -- and worse -- of having to make repeated adjustments to changing legal requirements. Accordingly, other courts of appeals have adopted the practice, when invalidating on procedural grounds a rule that has been in effect during the litigation, of permitting the rule to remain in effect while, on remand, it is re-examined by the agency. See, e.g., AFL-CIO v. Brennan, 530 F.2d 109. 124 (3d Cir. 1975); National Nutritional Foods Ass'n v. Weinberger, 512 F.2d 688 (2d Cir.), cert. denied, 423 U.S. 827 (1975); K.C. Davis, Administrative Law Section 6.12, at 505 (1978). The District of Columbia Circuit, in contrast, generally vacates the rule itself while the agency studies the issues raised. See Tabor v. Joint Board for Enrollment of Actuaries, 566 F.2d 705, 711-712 (D.C. Cir. 1977). Both approaches are compatible with the need for consistency during the remand period, so long as the agency has the authority, where appropriate, to maintain the status quo on an emergency basis while a new rulemaking proceeds. And this Court expressly recognized that authority last Term, in circumstances closely analogous to these, in Motor Vehicle Manufacturers' Association, slip op. 19 n. 15, 26 n. 21. /5/ Here, however, the court of appeals' failure to grant a stay, and the district court's interpretation of the court of appeals' mandate as precluding an emergency suspension of the homework ban, throws the regulatory decisionmaking process into disarray and subjects the public, for no reason, to the possibility of two dramatic shifts in applicable rules in less than a three month period. c. Probability of success on the merits. The district court has erred because it has, without good reason, taken away the Secretary's power to issue with justification a temporary suspension of an agency rule while the agency studies the underlying matter preparatory to further rulemaking. Nothing in the language of the court of appeals' mandate or opinion warrants the district court's interpretation, and that interpretation is plainly at odds with principles of administrative law as established by this and other courts. The district court's alternative holding that the emergency rule could not be issued on a temporary basis without public notice and comment under the "good cause" exception of the APA is also in error. i. Nothing in the judgment of the court of appeals, issued in lieu of mandate, precluded an emergency suspension of the homework ban. That judgment simply provided (Attachment L): On consideration thereof It is ordered and adjudged by this Court that the judgment of the District Court appealed from in this cause is hereby reversed and appellee Secretary's rescission of certain homework restrictions in the knitted outerwear industry is vacated. This case is remanded to the District Court with instructions to return the matter to the Secretary for further proceedings as may be warranted. All of the foregoing is in accordance with the opinion of this court filed herein this date. Assuming that the final sentence of the judgment should be interpreted as incorporating the whole of the opinion, we find somewhat greater ambiguity. The final paragraph of the opinion (Attachment M; 722 F.2d at 828) stated: For the foregoing reasons, we reverse the decision of the District Court and vacate the Secretary's rescission of homework restrictions in the knitted outerwear industry. The case is remanded to the District Court with instructions to return the matter to the Secretary for further proceedings as warranted. The restriction against industrial homework shall be reinstated and remain in effect unless properly modified pursuant to "reasoned decisionmaking" consistent with the opinion of this Court. The district court itself, interpreting these instructions, remanded the matter to the Secretary "for further proceedings as may be warranted" (Attachment H). The mandate of the court of appeals thus did not preclude issuance of this emergency rule. The judgment itself unconditionally remanded the matter "to the Secretary for further proceedings as may be warranted." The opinion admittedly contemplated that the homework ban would be reinstated, but it also expressly stated that the ban could be "properly modified pursuant to 'reasoned decisionmaking' consistent with the opinion of (the court of appeals)." As we show below, the Secretary's decision to suspend the ban for 120 days for those persons already engaged in knitted outerwear homework was plainly "reasoned decisionmaking" and in no way inconsistent with the court's invalidation, on procedural grounds, of the earlier permanent rescission. The basis for the district court's order, however, appears to be that any emergency suspension of the homework ban -- however "reasoned" -- would violate the mandate. That conclusion is simply extraordinary. It amounts to a holding that because the Secretary fell short in his first attempt to exercise his delegated authority, he is stripped of his inherent power to act in the interim. Such a holding surely requires some explicit basis in the court of appeals' opinion. Yet the opinion is silent on the issue. Indeed, to our knowledge, the question of the Secretary's prerogatives on remand was never briefed or argued, or even mentioned by the parties in their presentations to the court of appeals. There is thus no evidence that the court of appeals ever intended to preclude the Secretary's use of his powers to issue an emergency rule. In Motor Vehicle Manufacturers' Association, supra, this Court held that an agency has the authority to suspend a regulation temporarily while studying an issue in order to arrive at a permanent solution. The court of appeals in that case had struck down as arbitrary and capricious an agency's rescission of a rule requiring inclusion of passive restraint devices in cars by a particular date. This Court affirmed the order vacating the agency rescission of the regulation, but held, on that record, that "it would have been permissible for the agency to temporarily suspend the passive restraint requirement or to delay its implementation date while the airbags mandate was studied." Slip op. 19 n. 15. The record before the Secretary here, no less than that in Motor Vehicle Manufacturers' Association, was ample to support a temporary suspension of the homework bar. See pages 14-15, infra. Certainly neither of the courts below has held that it was not. In these circumstances, the district court's interpretation of the court of appeals' mandate to prohibit a temporary suspension was in clear violation of this Court's ruling in Motor Vehicle Manufacturers' Association. We recognize that the court of appeals hinted strongly in its order of April 30, 1984, that its prior mandate had, in fact, precluded this emergency rule. See Attachment C, slip op. 6. Ordinarily, a court's interpretation of its own mandate is entitled to substantial deference. In this instance, however, we believe that that interpretation is not only wrong as a matter of plain language, but that it would be flatly inconsistent with this Court's recent decision in Motor Vehicle Manufacturers' Association, supra, and in conflict with the decisions of other courts of appeals. See AFL-CIO v. Brennan, supra; National Nutritional Foods Ass'n v. Weinberger, supra. Accordingly, we are confident that the district court's erroneous interpretation of the court of appeals' mandate will be corrected by the court of appeals or, if necessary, by this Court. /6/ ii. The Secretary's emergency rule comports with the "reasoned decisionmaking" required by the court of appeals' prior judgment and by the Administrative Procedure Act. This Court stated in Motor Vehicle Manufacturers' Association slip op. 21, that an agency may suspend a rule if it is "uncertain about (the rule's) efficacy" or if there are "serious uncertainties" supported by the record. In the case at bar there are plainly uncertainties about the efficacy of, or need for, a complete ban on homework in the knitted outerwear industry, and the Secretary is now restudying that issue. As the notice of the Secretary's emergency rule states, the ban on homework does not appear to have been "especially effective" (Attachment E; 49 Fed. Reg. 11794). In addition, the Department's evidence reveals that, for investigated firms, the FLSA compliance rate among homework employers is "roughly comparable to that found in all covered industries." Id. at 11794-11795. Thus, the Secretary has identified "serious uncertainties" regarding an overall ban on homework within the industry. This fact alone would justify a temporary suspension while further study is done. However, in this case a temporary suspension is also called for in light of the Secretary's findings regarding hardship among homeworkers if the ban is reinstated, only to possibly be lifted several months later. See Attachment E; 49 Fed. Reg. 11793. At the same time, no comparable injury to the other employees or employers in the knitted outerwear industry has been identified as likely to take place during the limited period at issue. Furthermore, based upon information not available at the time of the 1981 rulemaking and its review, the Secretary has concluded that the Department can enforce the FLSA among the small number of homeworkers covered by the suspension during the relevant 120 day period. See Attachment E; 49 Fed. Reg. 11794-11795. In light of the limited nature of the temporary suspension and the Secretary's more complete articulation of his rationale for the emergency rule, the concerns expressed by the court of appeals in its November 1983 decision regarding enforcement of the FLSA among homeworkers should be allayed. In sum, the reasons stated by the Secretary amply establish that the emergency rule was an exercise of "reasoned decision-making." Nor, contrary to the district court's decision (Attachment B, slip op. 3), does the absence of public notice and comment detract from the emergency rule's quality of "reasoned decision-making." It is well established that, if it shows "good cause," an agency may avoid APA notice and comment procedures when engaged in new rulemaking after its prior rule had been vacated. See Action on Smoking and Health v. CAB, 713 F.2d 795, 800 (D.C. Cir. 1983). /7/ Good cause is present under the APA when: (1) the agency rule responds to an emergency created by forces beyond the agency's control; (2) the rule is an interim one effective for a finite, short period; and (3) the agency acts diligently to implement a permanent rule pursuant to notice and comment procedures. See National Federation of Federal Employees v. Devine, 671 F.2d 607, 610-612 (D.C. Cir. 1982); American Federation of Government Employees v. Block, 655 F.2d 1153, 1155-1159 (D.C. Cir. 1981). All of these factors are present here. The suspension at issue is limited in nature and in time. It covers only a period not to exceed 120 days and applies solely to the relatively small number homeworkers in the knitted outerwear industry who have been employed in that industry since November 1981. Furthermore, the Department of Labor is now acting expeditiously to implement a permanent rule pursuant to full APA notice and comment procedures. The agency has also clearly acted here to address an emergency created by forces beyond its control. The effect of issuance of the court of appeals' mandate immediately following denial of the rehearing petition was to reinstate the ban on homework and to require the Secretary to institute new rulemaking proceedings. An emergency situation beyond the agency's control arose for home knitters because new rulemaking proceedings designed to formulate a permanent rule would take at least several months. The district court held (Attachment B, slip op. 6) that an emergency situation was not present because the Secretary was faced not with unforeseen circumstances, but only with a court ruling that his prior regulatory action was not properly explained or reasoned. However, this situation was unexpected because the Secretary obviously could not have anticipated that his rule would be vacated by the courts. Indeed, the rule was originally upheld by the district court as valid under the FLSA and the APA. Therefore, the Secretary clearly did not err in not invoking new rulemaking proceedings before the court of appeals ruled; and, once the court did so and denied rehearing, the Secretary was faced with an unforeseen crisis creating severe dislocations for hundreds of homeworkers. As the petitions and affidavits from homeworkers sent to the Secretary (Attachment G) demonstrate, reinstitution of the ban would cause them to lose income since many of them are unable to take other employment outside the home and away from their families. See Attachment E; 49 Fed. Reg. 11792-11793. This situation brings unnecessary hardship if the new rulemaking now pending eventually results instead in a final rescission of the home knitting ban. In addition, some home knitting jobs may be lost forever under these circumstances because some employers may not find it practicable to incur new start-up costs after having been forced to close down only several months earlier. Id. at 11793. The basis for finding "good cause" in this case -- avoiding throwing a limited class of homeworkers out of their jobs unnecessarily -- is at least as weighty as that found sufficient in other cases. See, e.g., Council of Southern Mountains Inc. v. Donovan, 653 F.2d 573 (D.C. Cir. 1981) (equipment for safety program not available in adequate quantity and not completely tested); NFFE v. Devine, supra, (unavailability of contract terms and brochures for federal health plans); AFGE v. Block, supra, (use of old guidelines would have caused economic harm and disruption to poultry processors); Northwest Airlines v. Goldschmidt, 645 F.2d 1309 (8th Cir. 1981) (need for notice to the traveling public of airline flight schedules). Thus, the Secretary properly found good cause under the APA to suspend homework restrictions immediately for homeworkers already employed in the industry for 120 days pending completion of the final rulemaking proceedings. iii. In addition to the above problems, the district court's order is based on several crucial misconceptions regarding the emergency rule itself. Contrary to the apparent belief of the district court (Attachment B, slip op. 4-7), the Secretary did not issue the same rule found by the court of appeals to have been inadequately reasoned and explained. At stake now is only a 120-day suspension covering a limited class of people -- those currently engaged in homework -- issued in order to prevent irreparable injury to that class while the Secretary engages in new rulemaking proceedings. Thus, the suspension is a far cry from the permanent rescission struck down in November 1983, covering the entire industry. /8/ The district court also erred in concluding (Attachment B, slip op. 4) that the emergency rule is the same as the relief denied by the court of appeals when it declined to grant a stay of its mandate pending a decision by the Solicitor General whether to seek further review. The situation posed by the emergency suspension is quite dissimilar, because the Secretary has exercised his power to commence new rulemaking proceedings and to implement a temporary suspension exempting a limited group of persons from the ban on homework. The standard of judicial review is accordingly different. A motion for a stay of mandate is directed to the discretion of the court. An emergency rule involves an exercise of the Secretary's discretion in issuing the rule, and the courts' role is to determine if the Secretary has acted in an arbitrary or capricious manner, or contrary to the mandate. In that inquiry, the Secretary's administrative action taken pursuant to a statute he administers is entitled to deference by the courts. /9/ In sum, the emergency rule did not violate the terms of the court of appeals' mandate, but was an appropriate and reasoned exercise of the Secretary's authority to promulgate an emergency rule, upon an ample showing of good cause. In light of the irreparable injury to the affected individuals, the public interest in the orderly process of regulatory decisionmaking, and the total absence of serious injury to the parties challenging the rule, this motion for a stay should be granted. CONCLUSION The application for a stay pending appeal in the court of appeals should be granted. Respectfully submitted. REX E. LEE Solicitor General MAY 1984 /1/ The government neither petitioned for certiorari nor supported the intervenors' motion for a stay in this Court, because of our judgment that a new rulemaking, coupled with an emergency suspension of the homework ban, would suffice to vindicate the government's interests. The intervenors have filed a petition for a writ of certiorari from the court of appeals' decision of November 19, 1983, which is not pending in this court, No. 83-1791 (filed May 1, 1984). This application for a stay is totally independent of that petition, and in no way rests on the merits of that petition. /2/ On the other hand, if the Secretary ultimately decides not to permit homework in the knitted outerwear industry, that decision can be implemented with appropriate notice to affected parties. See 49 Fed. Reg. 11793. /3/ In its April 30, 1984 opinion (Attachment C), the court of appeals commented that an irreparable injury to plaintiffs "could certainly be inferred from this court's original decision." Slip op. 3. However, the court's original opinion addressed only whether plaintiffs had made a sufficient showing of injury for purposes of standing. That injury need not, of course, be irreparable, or even substantial. See United States v. SCRAP, 412 U.S. 669 (1973). /4/ Of course, if a rule is found to be contrary to statute or to the Constitution, this argument does not apply. No such ruling was made here. /5/ Following this Court's ruling in Motor Vehicle Manufacturers' Association, in September 1983, the District of Columbia Circuit denied a request that it retain jurisdiction while the matter was on remand to the relevant agency for further study. The agency had earlier temporarily suspended the regulation at issue (without prior public notice or comment) pending its new rulemaking (48 Fed. Reg. 39908), and that action was not challenged. /6/ The government did not seek further review of the court of appeals decision invalidating the original rescission of the homework ban because it could be remedied administratively by a new rulemaking. If the court of appeals were now to determine that its invalidation of the rule, on procedural grounds, bars further emergency action, such a holding would, in our opinion, raise an issue of serious importance to administrative procedure generally. /7/ The exceptions to notice and comment procedures were created by Congress to "accommodate situations where the policies promoted by public participation in rulemaking are outweighed by the countervailing considerations of effectiveness, efficiency, expedition and reduction in expense," Guardian Federal Savings & Loan v. FSLIC, 589 F.2d 658, 662 (D.C. Cir. 1978); S. Rep. No. 752, 79th Cong., 1st Sess. 14 (1945). Here, of course, the public has already had full notice and opportunity to comment, in connection with the original permanent rescission. /8/ Moreover, while this fact was seemingly ignored by the district court (Attachment B, slip op. 5-7), to support the temporary suspension the Secretary used enforcement information not available when the original rescission was issued. See Attachment E; 49 Fed. Reg. 11794-11795. That information led the Secretary to conclude that he can enforce the FLSA for the limited number of homeworkers involved for the 120-day period at issue. Ibid. The district court did not limit its focus to the 120 day life of the emergency rule at issue because it found that a far longer time will pass before a new rule is promulgated and reviewed. Attachment B, slip op. 6. The review period for any new rule is irrelevant for consideration of the validity of the temporary rule now being challenged. If, after the new rule issues, a party challenges it and seeks an injunction pending review, such a request would be considered and ruled on at that time, with such factors as irreparable injury and likelihood of success on the merits taken into account. /9/ Furthermore, contrary to the district court's view, the denial of the government's stay motion could mean several things. The court of appeals could have believed that sufficient time had already passed for the government to decide whether further review was warranted. Or the court could simply have decided that it should not stay its mandate but should remand the matter immediately so that the Secretary could begin new rulemaking proceedings expeditiously. Thus, the denial of the stay motion cannot be read as prohibiting future emergency action such as that the Secretary took. APPENDIX