FEDERAL COMMUNICATIONS COMMISSION, ET AL., PETITIONERS V. ITT WORLD COMMUNICATIONS, INC., ET AL. No. 83-371 In the Supreme Court of the United States October Term, 1983 The solicitor General, on behalf of the Federal Communications Commission and the United States, petitions for a writ of certiorari to review the judgment of the United States Court of Appeals for the District of Columbia Circuit in this case. Petition for a Writ of Certiorari to the United States Court of Appeals for the District of Columbia Circuit PARTIES TO THE PROCEEDING In addition to the parties named in the caption, the United States is a petitioner, and Southern Pacific Communications Company and RCA Global Communications, Inc., are respondents. TABLE OF CONTENTS Opinions below Jurisdiction Statutory provisions involved Statement Reasons for granting the petition Conclusion Appendix A Appendix B Appendix C Appendix D Appendix E OPINIONS BELOW The opinion of the court of appeals (App. A, infra, 1a-54a) is reported at 699 F.2d 1219. The opinion of the district court (App. D, infra, 60a-66a) is not reported. The opinion of the Federal Communications Commission (App. E, infra, 70a-87a) is reported at 77 FCC 2d 877. JURISDICTION The judgment of the court of appeals (App. B, infra, 55a-56a) was entered on February 1, 1983, and a timely petition for rehearing was denied on April 6, 1983 (id. at 57a-58a). By order dated July 1, 1983, the Chief Justice extended the time within which to file a petition for a writ of certiorari to and including September 3, 1983. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). STATUTORY PROVISIONS INVOLVED Section 402(a) of the Communications Act, 47 U.S.C. 402(a), provides: Any proceeding to enjoin, set aside, annul, or suspend any order of the Commission under this chapter (except those appealable under subsection (b) of this section) shall be brought as provided by and in the manner prescribed in chapter 158 of Title 28. 28 U.S.C. 2342 provides in pertinent part: The court of appeals has exclusive jurisdiction to enjoin, set aside, suspend (in whole or in part), or to determine the validity of (1) all final orders of the Federal Communications Commission made reviewable by section 402(a) of title 47; * * *. The Government in the Sunshine Act, 5 U.S.C. 552b, provides in pertinent part: (a) For purposes of this section (1) the term "agency" means any agency, as defined in section 552(e) of this title, headed by a collegial body composed of two or more individual members, a majority of whom are appointed to such position by the President with the advice and consent of the Senate, and any subdivision thereof authorized to act on behalf of the agency; (2) the term "meeting" means the deliberations of at least the number of individual agency members required to take action on behalf of the agency where such deliberations determine or result in the joint conduct or disposition of official agency business * * *. * * * * * (b) Members shall not jointly conduct or dispose of agency business other than in accordance with this section. Except as provided in subsection (c), every portion of every meeting of an agency shall be open to public observation. QUESTIONS PRESENTED 1. Whether the Government in the Sunshine Act, 5 U.S.C. 552b, which generally requires that agency meetings be open to public observation, applies when members of an administrative agency who do not constitute a quorum and have not been authorized to conduct official business on the agency's behalf participate in informal, general discussions with their foreign counterparts concerning issues of common interest. 2. Whether suit may be brought in district court to enjoin allegedly ultra vires action by the Federal Communications Commission even though jurisdiction to review that agency's orders is vested exclusively in the court of appeals and the precise issue raised in the district court suit could have been reviewed by this method. STATEMENT 1.a. In 1976, Congress enacted the Government in the Sunshine Act, Pub. L. No. 94-409, 90 Stat. 1241, 5 U.S.C. 552b, which requires that any "meeting" of an "agency" covered by the Act must be open to public observation except in a few, specific circumstances. The term "agency" is narrowly defined (5 U.S.C. 552b(a)(1)) to include only those agencies headed by a collegial body composed of two or more individual members, a majority of whom are appointed to such position by the President with the advice and consent of the Senate, and any subdivision thereof authorized to act on behalf of the agency; The term "meeting" is defined (5 U.S.C. 552b(a)(2)) as: the deliberations of at least the number of individual agency members required to take action on behalf of the agency where such deliberations determine or result in the joint conduct or disposition of official agency business * * *. If a covered "agency" holds a "meeting" as defined in the Act, in most circumstances, the time, place, and subject matter of the meeting must be announced at least one week in advance. 5 U.S.C. 552b(e)(1). The meeting also must be open to the public unless one of the Act's ten exceptions applies (see 5 U.S.C. 552b(c)). /1/ If the agency wishes to invoke one of those exceptions, it may do so only by a formal vote (5 U.S.C. 552b(d)(1)). In addition, the agency must make and maintain a complete transcript or recording of the meeting /2/ and must permit public inspection of all portions of the transcript or recording not protected by the exemption under which the meeting was closed (5 U.S.C. 552b(f)). "(A)ny person" may seek judicial review of an agency's compliance with the open-meeting requirement by filing suit "in the district court * * * for the district in which the agency meeting is held or in which the agency in question has its headquarters, or in the District Court for the District of Columbia" (5 U.S.C. 552b(h)(1). If the court finds that the agency has failed to satisfy the Act, it "may grant such equitable relief as it deems appropriate," including disclosure of the transcript or recording of the meeting (5 U.S.C. 552b(h)(1)). /3/ b. The Communications Act, 47 U.S.C. 151 et seq., confers upon the Federal Communications Commission the power to regulate "interstate and foreign commerce in communication by wire and radio * * *" (47 U.S.C. 151). As part of this mission, the Commission regulates the operations of respondent and the other companies involved in this case, which are existing or proposed common carriers of "record" communications (i.e., written communications, such as telex) in the international market. A common carrier may acquire facilities so as to initiate new service only after it obtains from the Commission a certificate of "public convenience and necessity" (47 U.S.C. 214). As a practical matter, however, if the proposed new service is to be international, the carrier may not begin operations until it reaches agreement with the appropriate government agencies in the foreign countries it proposes to serve. See ITT World Communications, Inc. v. FCC, 595 F.2d 897 (2d Cir. 1979). c. Under FCC regulations, "(a)ny interested person may petition for the issuance, amendment or repeal of a rule or regulation." 47 C.F.R. 1.401(a). The petition "shall set forth * * * all facts, views, arguments and data deemed to support the action requested * * *" (47 C.F.R. 1.401(c)). The Commission then issues a "public notice" of the petition (47 C.F.R. 1.403), and "(a)ny interested person may file a statement in support of or in opposition to" it (47 C.F.R. 1.405(a)). The Commission's rules also permit aggrieved parties to petition for a declaratory ruling regarding the propriety of Commission actions, including those not theretofore embodied in orders subject to judicial review (47 C.F.R. 1.2). Jurisdiction to review Commission orders, including declaratory rulings and orders denying petitions for rulemaking is vested exclusively in the courts of appeals. The relevant provision of the Communications Act provides (47 U.S.C. 402(a)): /4/ Any proceeding to enjoin, set aside, annul, or suspend any order of the Commission under this chapter (except those appealable under subsection (b) of this section) shall be brought as provided by and in the manner prescribed in chapter 158 of Title 28. Chapter 158 of Title 28, in turn, provides at 28 U.S.C. 2342: The court of appeals (other than the United States Court of Appeals for the Federal Circuit) has exclusive jurisdiction to enjoin, set aside, suspend (in whole or in part), or to determine the validity of -- (1) all final orders of the Federal Communications Commission made reviewable by section 402(a) of title 47 * * *. 2.a. Respondent ITT World Communications, Inc. is an existing international record carrier in the trans-Atlantic market. In 1977, the FCC authorized two smaller companies, Graphnet Systems, Inc. and GTE Telenet Communications Corp., to enter into competition with respondent in this field. Respondent unsuccessfully challenged those authorizations in a petition for review filed in the Second Circuit. See ITT World Communications, Inc. v. FCC, 595 F.2d 897 (1979). Despite the Commission's authorizations, the European telecommunications agencies, with which respondent has been doing business for years, refused to enter into interconnection arrangements with the new companies, and those companies were consequently unable to begin competing with respondent. /5/ See App. A, infra, 4a. Between October 1979 and October 1980, at conferences in Europe, three of the seven members of the Commission held informal discussions touching upon this situation with officials of the European and Canadian agencies. These discussions took place at a series of conferences among telecommunications administrators called the "Consultative Process" (CP) (see App. E, infra, 78a). Begun in 1974, the CP was originally intended "to imporve, through the exchange of information and views, the usage planning of jointly-owned telecommunications facilities in the North Atlantic Region" (ibid.). ITT actively supported the CP until the Commissioners attending a session in Dublin, Ireland, in October 1979 initiated a preliminary discussion concerning the desirability of adding to the agenda topics such as new carriers and services (ibid.). "Out of apparent concern that such additional consultations could ultimately lead to greater competition in the provision of international communications services," respondent launched a two-pronged attack that "in effect challenge(d) the Commission's authority to engage in any form of foreign consultative discourse" (id. at 78-79a). b. First, in October 1979, respondent petitioned the Commission for rulemaking. Respondent requested that the Commission issue a policy statement disclaiming any intent to negotiate with foreign telecommunications agencies and delineating the authority of Commissioners attending CP sessions (App. E, infra, 71a-72a). Respondent also sought the issuance of rules requiring that the Commission provide 30 days' advance public notice of all such meetings and the topics to be discussed and that any interested carrier be permitted to object to the scheduled topics, to propose additional topics, and to express its views (id. at 72a). Under respondent's proposal, the Commission would have been required to indicate its disposition of all such comments received (ibid.). Furthermore, respondent sought the promulgation of regulations requiring that all such international consultations be open to the public in compliance "with the spirit and the letter" of the Sunshine Act; that all discussions be held on the record; and that all interested private parties be permitted to express their views (id. at 72a). /6/ The Commission denied respondent's rulemaking petition. The Commission stated that it had never negotiated with foreign telecommunications officials and that those officials had manifested understanding of the scope of the Commission's authority (App. E, infra, 79a-80a). The Commission observed that the Consultative Process did not involve negotiation but had provided "a valuable if not indispensable source of information" concerning "future foreign communications needs and the solutions to those needs that will be acceptable to other countries" (id. at 79a). The Commission stated that the discussions thereby "free(d) (the Commission) from near total dependence on (its) regulatees in gauging foreign telecommunications problems and needs" (ibid.). By the same token, the Commission noted that the discussions gave the attending Commissioners the opportunity "to explain and promote (the FCC's) statutory mandate" to foreign officials accustomed to legal and economic systems far different from ours (see id. at 81a-82a). The Commission concluded (id. at 81a) that the Communications Act, which confers upon the Commission the authority to regulate international communications, "clearly permits -- in fact encourages" -- the informal contacts challenged by respondent. In addition, the Commission held (App. E, infra, 81a-84a) that the Sunshine Act does not apply to the CP sessions. However, "recogniz(ing) and support(ing) the desirability of conducting its activities, both formal and informal, within public view," the Commission adopted notice and reporting requirements with respect to contacts with foreign administrators (id. at 84a). c. While its rulemaking petition was still pending (see App. A, infra, 12a), respondent filed suit against the Commission in the United States District Court for the District of Columbia, claiming among other things that the Commissioners were acting ultra vires by engaging in negotiations at the CP sessions and that they were violating the Sunshine Act (see App. D, infra, 61a-63a). The district court dismissed the ultra vires count for lack of standing and ripeness /7/ and expressed doubt about its subject matter jurisdiction over that claim (ibid.; App. C, infra, 59a). The court also granted ITT's summary judgment motion on the Sunshine Act claim (id. at App. D, infra, 65a-66a; App. C, infra, 59a). /8/ d. Consolidating ITT's petition for review of the denial of rulemaking with cross-appeals from the district court judgment, the court of appeals held that the ultra vires count had been improperly dismissed and that the Sunshine Act applies to the CP sessions (App. A, infra, 13a-21a, 34a-45a). The court also reversed in part the FCC's denial of rulemaking (id. at 45a-53a). The court of appeals concluded that the district court had subject matter jurisdiction over the ultra vires count because, in the court of appeals' view, that claim presented different issues from the rulemaking petition, de novo judicial factfinding was needed, and the allegedly improper Commission action would not otherwise be subject to judicial review (App. A, infra, 13a-17a). Turning to the interpretation of the Sunshine Act, the court of appeals first considered the provision making the Act applicable only at gatherings attended by a quorum of the full agency or a subdivision authorized to act on its behalf (5 U.S.C. 552b(a)(1)). The court noted that the attending Commissioners constituted a quorum of one of the Commission's two standing committees, the Telecommunications Committee. While acknowledging that the limited authority delegated to the Telecommunications Committee by the FCC rules did not authorize it to act on the Commission's behalf at the CP sessions, the court inferred that such authority had been granted informally and in contravention of the Communications Act (App. A, infra, 36a-37a). The court did not decide whether the CP sessions constituted "deliberations," one of the key elements needed for Sunshine Act coverage (see 5 U.S.C. 552b(a)(2)) (see App. A, infra, 37a). Finally, the court held (id. at 38a-40a) that the CP sessions resulted in the conduct of "official agency business" within the meaning of the Act (5 U.S.C. 552b(a)(2)) because, in the court's view, important matters related to agency business were discussed and because the court saw no relevant distinction between those discussions and "hearings (and) meetings with the public," which, according to the court's reading of the legislative history, were intended to fall within the statutory coverage (App. A, infra, 38-39a). The court of appeals also reversed the denial of rulemaking on the Sunshine Act issue (App. A, infra, 48a), remanded the Commission's refusal to delineate its authority at the CP sessions for failure to compile an adequate administrative record (id. at 49a-53a), and "direct(ed) that, so long as the (Telecommunications) Committee continues to play (the same) role in the consultative process, it do so only pursuant to a proper and precise delegation of authority from the Commission" (id. at 53a). To prevent "duplication, conflicting resolutions, and further delay" because of its double remand to the Commission and the district court, the court of appeals suggested that the Commission stay further action on the rulemaking petition until the district court disposes of the ultra vires claim (id. at 52a). The Commission's petition for rehearing was denied, with Judges MacKinnon, Bork, and Scalia voting for rehearing en banc. REASONS FOR GRANTING THE PETITION The court of appeals has issued two important rulings that threaten significant interference with the proper and efficient functioning of administrative agencies. The court has held that the Sunshine Act applies to informal exchanges, overseas, by agency delegates with their foreign counterparts, even though the delegates have no authority to act for the agency. And the court has held that persons challenging agency action may bypass normal statutory review procedures by filing suit in district court alleging that the agency has acted ultra vires. These rulings are plainly wrong and will produce deleterious consequences. Because all suits under the Sunshine Act (see 5 U.S.C. 552b(h)(1)) and the vast majority of suits alleging ultra vires action by administrative agencies (see 28 U.S.C. 1391(e)) may be brought in the United States District Court for the District of Columbia, review by this Court is warranted at the present time. 1. a. The Sunshine Act requires (5 U.S.C. 552b(b)) that "every portion of every meeting of an agency shall be open to public observation" unless it falls within one of the Act's exceptions (see 5 U.S.C. 552b(c)). As previously noted, the term "agency" is limited to a "collegial" body or "any subdivision thereof authorized to act on behalf of the agency" (5 U.S.C. 552b(a)(1)). The term "meeting" is defined as the "deliberations" of a quorum of the agency or an authorized subdivision "where such deliberations determine or result in the joint conduct or disposition of official agency business" (5 U.S.C. 552b(a)(2)). Thus, the Sunshine Act applies only if (i) a quorum of an agency or "subdivision thereof authorized to act on behalf of the agency" (ii) engages in "deliberations" (iii) that "determine or result in the joint conduct or disposition of official agency business." None of these elements is satisfied here. b. i. The CP sessions were not attended by a quorum of the Commission or any authorized subdivision. It is undisputed that a quorum of the Commission -- then four members /9/ -- was not present. The court of appeals held, however, that the Act applied because a quorum of the three-person Telecommunications Committee (see 47 C.F.R. 0.215) -- one of the Commission's two standing committees (47 C.F.R. 0.4) -- was in attendance. That holding, however, will not withstand analysis. First, the Commission's rules plainly show that the Telecommunications Committee was not authorized to act on the Commission's behalf at the CP sessions. Pursuant to the Communications Act (47 U.S.C. 155(b)), the Commission has delegated specific, limited functions to the Telecommunications Committee (47 C.F.R. 0.215), i.e., the authority to act upon applications by common carriers for certificates of public convenience and necessity (47 U.S.C. 214) and certain applications for radio station construction permits (47 U.S.C. 319). It has never been suggested that the Telecommunications Committee members engaged in either of these activities at the CP gatherings. Accordingly, they were not "authorized to act on behalf of the (Commission)" at those gatherings, and if they had purported to do so, their actions would have been of no effect. Nevertheless, the court of appeals inferred that the Commission had made an unofficial and, indeed, an unlawful delegation of authority to its Telecommunications Committee, /10/ and the court held that such a delegation suffices to activate the Sunshine Act's requirements (App. A, infra, 36a-37a) 52a-53a). Not only was there no basis for the court of appeals factfinding, but the court completely disregarded the normal presumption of administrative regularity. See Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 415 (1971); United States v. Chemical Foundation, Inc. 272 U.S. 1, 14-15 (1926). The court reasoned (App. A, infra, 36a) that "applicability of the Sunshine Act manifestly cannot turn on whether an agency has in fact followed proper procedures for delegating authority to a subdivision, for the requirements of the Act could otherwise be evaded at will." Whatever attraction the court's interpretation may have at first blush, it is inconsistent with the language of the Act and will in practice prove to be unworkable. The language of the Sunshine Act shows that an agency "subdivision" is not "authorized to act on behalf of the agency" unless it has received an official delegation of authority. The very term "subdivision" connotes a body that has been officially created and that has a fixed membership and responsibilities, rather than a loose group informally assigned by an agency to assist it in the performance of certain tasks. The requirement that a quorum of the subdivision must be present also suggests that the subdivision must have a fixed, ascertainable membership, for otherwise it would be impossible to determine whether a quorum is in attendance. As a leading treatise on the Sunshine Act states (R. Berg & S. Klitzman, An Interpretive Guide to the Government in the Sunshine Act 3 (1978)): "At a minimum, a subdivision must have a specified membership and fixed responsibilities; an informal working group authorized to report back to the body is not a subdivision." The quorum requirement also suggests that the subdivision must possess the authority to take formal action on behalf of the agency rather than merely the responsibility to assist the full agency in some way. The latter function may be performed whether or not a quorum of a subdivision is present. Thus, if Congress intended the Act to cover bodies possessing only such informal power, it is difficult to understand why it included the quorum requirement. On the other hand, a quorum is needed in order for the subdivision to take formal action, and therefore the quorum requirement makes perfect sense if, as we maintain, the Sunshine Act reaches only those agency subdivisions possessing officially delegated powers. Practical considerations also suggest that Congress intended this interpretation. If the Sunshine Act were satisfied by unofficial authorization or authorization in contravention of governing statutes or rules, as the court of appeals held, a colorable Sunshine Act claim could be asserted whenever agency members engaged in any activity related to their official responsibilities. In all such instances, it could be claimed that, despite proof that official authorization had not been granted or even had been expressly withheld, the members in fact received unofficial, implied, or sub rosa authorization to act on the agency's behalf. Persons asserting such claims would predictably demand the right to discover all information bearing upon the question of unofficial authorization. Such evidentiary proceedings obviously would create a great potential for harassment and interference with the proper functioning of the agency. Congress could not have wanted to encourage these results. The court of appeals concluded that unofficial authorization satisfies the Sunshine Act because the court wished to prevent evasion of the Act's requirements (see App. A, infra, 36a). However, the court overlooked several factors that significantly limit the importance of this problem. If agency members purport to take official action on the agency's behalf without proper authorization, their action may be set aside. On the other hand, if they do not purport to take such action but merely assist the full agency, any official action subsequently taken by the agency will be subject to the Sunshine Act's constraints. Moreover, an agency willing to delegate its authority in order to evade the Sunshine Act's requirements may easily do so by authorizing a single agency member /11/ or agency employees /12/ to act on its behalf. While Congress recognized such possibilities, /13/ it chose not to make the Act's coverage absurdly broad solely to preclude all chance of evasion. ii. The Sunshine Act applies only if an agency or authorized subdivision engages in "deliberations (that) result in the joint conduct or disposition of official agency business" (5 U.S.C. 552b(a)(2)). Although the court of appeals dealt at length with the problem of defining "the joint conduct or disposition of official agency business" (see App. A, infra, 37a-43a), the court dispensed altogether with the requirement that the agency or subdivision must engage in "deliberations." The court wrote (id. at 37a): "Deliberations" might be read narrowly to encompass solely the internal process of weighing and examining proposals that precedes a formal decision by the agency. On the other hand, "conduct . . . of official agency business" suggests a much broader range of activity, including, inter alia, hearings and meetings with outsiders. The court then proceeded to examine the latter question (id. at 37a-43a), never to return to the requirement of "deliberations." /14/ The court thus excised one of the Act's key elements. The court of appeals' radical surgery greatly expanded the Act's coverage. The term "deliberations" is defined as "weighing and examining the reasons for and against a choice or measure" and as "discussion and consideration by a number of persons of the reasons for and against a measure." Webster's Third New International Dictionary 596 (1976); see also Black's Law Dictionary 384 (5th ed. 1970). Thus, as the court of appeals itself suggested (App. A, infra, 37a), the term excludes the gathering of information when not related to any pending or prospective agency decision, as well as efforts to explain the basis for or to facilitate compliance and cooperation with a decision that has already been completed. /15/ By reading the element of "deliberations" out of the statute, the court was able to reach precisely the opposite result. iii. The final element required for Sunshine Act coverage is that the deliberations must "result in the joint conduct or disposition of official agency business" (5 U.S.C. 552b(a)(2)). The legislative history indicates that this language, while extending beyond those sessions at which an agency formally disposes of a matter (S. Rep. No. 94-354, 94th Cong., 1st Sess. 18 (1975) (hereinafter "S. Rep."), does not include every gathering at which some reference is made to agency business. /16/ The authoritative Senate report /17/ (S. Rep. 18) states: To be a meeting the discussion must be of some substance. Brief references to agency business where the commission members do not give serious attention to the matter do not constitute a meeting. * * * The words "deliberation" and "conduct" were carefully chosen to indicate that some degree of formality is required before a gathering is considered a meeting for purposes of this section. The same report goes on to indicate that "informal and preliminary discussions," as opposed to "discussions which effectively predetermine official actions," do not fall within the Act (id. at 19). Adopting this same limitation, R. Berg and H. Klitzman, supra, at 9 (emphasis added) concludes: A discussion which is sufficiently focused on discrete proposals or issues as to cause or be likely to cause the individual participating members to form reasonably firm positions regarding matters pending or likely to arise before the agency is a meeting, while, in our view, a discussion which is merely informational or exploratory is not. Under this interpretation, it seems clear that the CP sessions did not "result in the joint conduct or disposition of official agency business." The court of appeals did not identify any official FCC action that had been predetermined at those gatherings; nor did the court find that the discussions focused on any discrete proposal related to any matters pending or likely to arise before the agency. On the contrary, the court found that the CP sessions served two far different purposes. First, the court stated (App. A, infra, 38a-39a; emphasis added) that the meetings "are an important means for gathering information and opinions from foreign administrations" and that such information may prove useful in future, unidentified FCC deliberations. As previously noted, however, a discussion that is merely informational and that does not relate to any pending or prospective agency action falls outside the Act. Second, the court of appeals found (App. A, infra, 39a) that the FCC had "chosen the CP as the vehicle to assist Graphnet and Telenet in obtaining interconnection agreements." However, accepting for the sake of argument the accuracy of the court's description of the CP sessions, such efforts on the part of the Commissioners in attendance did not predetermine or relate to any future FCC decision or any matter pending or likely to arise before the Commission, since the Commission had already authorized Graphnet and Telenet to enter the trans-Atlantic record communications market. Rather, the Commissioners merely sought to explain the basis for and thus facilitate implementation of a decision that had previously been made. Disregarding the limitations clearly spelled out in the legislative history, the court of appeals adopted a sweeping interpretation of the phrase "conduct or disposition of official agency business." The court rejected "a distinction between an agency's predecisional activities and its postdecisional efforts to implement, interpret, and promote its policies" (App. A, infra, 39a); found that merely "gathering information" may trigger the Act's coverage (id. at 38a-39a); and concluded that "informal background discussions" may also fall within the Act, particularly if "outside parties" are present (id. at 41a-43a). Apart from the suggestion that "chance meetings," "social gatherings," and informal conversations among agency members are usually not covered by the Act (see App. A, infra, 43a), the only easily discernible limitation in the court's definition is that covered sessions must entail discussion that is related to the agency's work in a way felt by the court to be important (see id. at 38a). This limitation obviously provides little guidance. /18/ c. The cumulative effect of the court of appeals' interpretation of the elements needed for Sunshine Act coverage gives the Act a startling reach far exceeding anything Congress intended. Under the court of appeals' approach, the Act would appear to apply whenever two or more agency members acting under what may be deemed unofficial agency authorization attend a gathering at which any matter viewed by the courts as related in some significant way to the agency's business is discussed. This interpretation of the Act -- which regulates informal, general discussions far removed from any prospective official agency action -- will unduly isolate agency members and thus hamper the effective performance of their responsibilities. It may be that in a future case the court of appeals would draw back from the broad pronouncements in its opinion here. We would certainly urge it to do so. But there will be no opportunity for that court to rectify its decision unless agencies deliberately take actions that are arguably in violation of the broad pronouncements in the decision below. Since agency members are quite properly reluctant to engage in such conduct, the court of appeals' decision will have a harmful chilling effect as long as it remains in force. The present case graphically illustrates the deleterious results that the court of appeals' construction will produce. Rapid technological advances have heightened the need for international coordination in many regulatory fields, including communications; and such coordination demands that administrators from different countries understand each other's objectives and strategies, as well as the technical, economic, legal, and political constraints under which they work. The best way to achieve the necessary mutual understanding is often through meetings at which administrators from different countries may meet face-to-face and engage in general, wide-ranging, and informal discussions. If such meetings must be open to the public (5 U.S.C. 552b(b)), if there must be a formal agenda (5 U.S.C. 552b(e)(1)), and if discussions must be recorded or transcribed (5 U.S.C. 552b(f)(1)), then the utility of such gatherings will be greatly reduced. Indeed, it can be expected that foreign participants will frequently make clear -- as happened here /19/ -- that they will not tolerate such peculiarly American restrictions, particularly upon meetings held on foreign soil. As a consequence, no discussions will be held or the American administrators will be effectively precluded from participation. This will not mean more government in the sunshine. It will mean more international misunderstanding and less effective regulatory coordination. No one will benefit -- except regulatees like respondent, which will have found a new and ingenious way to thwart the administrative process. 2. Equally damaging to the administrative process is the court of appeals' holding (App. A, infra, 13a-16a) that respondent is entitled to sue the FCC in district court for the purpose of correcting allegedly ultra vires agency action. The court reached this conclusion even though exclusive jurisdiction to review FCC orders is vested in the courts of appeals, even though an issue virtually identical to respondent's ultra vires claim had been presented in respondent's rulemaking petition and was before the court of appeals in respondent's petition for review of the denial of rulemaking, and even though respondent, by a motion to the Commission for a declaratory ruling (47 C.F.R. 1.2), could have raised the identical issue embodied in its district court claim. The court of appeals' decision on this issue is a marked departure from settled law. See 5 U.S.C. 704 (agency action is reviewable in district court under Administrative Procedure Act where "there is no other adequate remedy in a court"). /20/ a. Initial review of FCC orders, like those of many other administrative agencies, /21/ is committed exclusively to the courts of appeals, rather than the district courts. This procedure ensures that challenges to administrative action are presented to the agency prior to judicial review; it guarantees that administrative action will not be delayed or reversed by a single district court judge but may only be set aside by a panel of appellate judges; it provides for review by a court with far greater cumulative expertise concerning sometimes arcane administrative matters; it streamlines the administrative process by removing a layer of judicial review; it reinforces tha rule that agency decisions should be reviewed on the administrative record, rather than based upon de novo judicial factfinding; it prevents interference with agency work and harassment of agency members and staff through time-consuming discovery requests and trial court proceedings; and it lessens the likelihood of conflicting adjudications concerning the same issue. See generally Whitney National Bank v. Bank of New Orleans, 379 U.S. 411, 419-423 (1965); Myers v. Bethlehem Shipbuilding Corp., 303 U.S. 41, 48-50 (1938); Note, Jurisdiction to Review Federal Administrative Action: District Court or Court of Appeals, 88 Harv. L. Rev. 980, 983 (1975). b. The court of appeals acknowledged that exclusive jurisdiction to review FCC orders is committed to the courts of appeals (App. A, infra, 13a), but the court found that concurrent district court jurisdiction was appropriate in this case for three reasons. None of those reasons, however, provides an adequate ground for permitting a regulatee such as respondent to bypass the prescribed method of judicial review. First, the court of appeals observed that respondent's rulemaking petition and its ultra vires count were not identical. The court remarked (App. A, infra, 14a) that while the "petition asked the Commission for a declaration of the nature of its authority with respect to the CP meetings," the ultra vires claim "assert(ed) that the Commission, irrespective of what it acknowledges as the proper scope of its authority, has in fact secretly exceeded that authority and will not admit to having done so." In our view, there is no real difference between these two issues. The Commission certainly did not detect any such distinction. It stated (App. E, infra, 77a) that respondent's petition raised the issue "whether the Commission has engaged in 'negotiations.'" And the Commission concluded (ibid.) that it "ha(d) not 'negotiated' with foreign entities." But even if there is a distinction between the issues raised in respondent's rulemaking petition and its district court complaint, that distinction is wholly the result of the way in which respondent chose to frame its pleadings. By couching its rulemaking petition in slightly different terms or by moving the Commission for a declaratory ruling (47 C.F.R. 1.2) concerning the legality of the Commissioners' conduct at the CP sessions, there is no doubt that respondent could have brought before the Commission precisely the same claim asserted in the ultra vires count. Any subsequent Commission order would then have been reviewable only in the courts of appeals. /22/ Respondent should not be allowed to circumvent the review procedures established by Congress solely because it artfully constructed a razor-thin distinction between the claims asserted in its administrative and district court pleadings. The court of appeals' second reason for recognizing concurrent jurisdiction was the alleged inadequacy of the administrative record as a basis for evaluating respondent's ultra vires claim and the purported need for "the kind of independent, de novo factfinding appropriate in the district court" (App. A, infra, 15a; footnote omitted). But the court ignored the fact that any need for additional factfinding could easily have been met by remanding the case to the Commission for supplementation of the administrative record /23/ or, if necessary, by referring the case to a district court judge as special master for proceedings in accordance with the court of appeals' specific guidelines and directions (see 28 U.S.C. 2347(b)(3)). The court of appeals' final reason for allowing respondent's ultra vires claim to go forward was that the challenged FCC action would not otherwise be subject to judicial review (App. A, infra, 16a). As previously noted, however, review in the court of appeals was available in two ways: by a petition for review of the denial of respondent's rulemaking request or by petition for review of a declaratory ruling. c. Even if the court of appeals' holding is limited to claims alleging unlawful agency action not embodied in an order subject to judicial review, its harmful potential is significant. Such claims are easy to imagine, and the decision below will encourage their assertion. By making burdensome and intrusive discovery requests, by pressing for time-consuming evidentiary hearings and other court proceedings, and, worst of all, by seeking to stay related administrative proceedings, litigants may postpone or prevent important agency action inimical to their interests. Even if such suits are ultimately unsuccessful on the merits, they may nevertheless achieve their intended results. The present case well illustrates this point, for as long as respondent can keep its district court action alive, it can effectively prevent discussions between FCC members and their European counterparts that might endanger respondent's profitable preferred status. This Court should grant review to prevent such unwarranted interference with the administrative process. CONCLUSION The petition for a writ of certiorari should be granted. Respectfully submitted. REX E. LEE Solicitor General J. PAUL MCGRATH Assistant Attorney General KENNETH S. GELLER Deputy Solicitor General SAMUEL A. ALITO, JR. Assistant to the Solicitor General LEONARD SCHAITMAN FRANK A. ROSENFELD Attorneys BRUCE E. FEIN General Counsel DANIEL M. ARMSTRONG Associate General Counsel Federal Communications Commission SEPTEMBER 1983 /1/ Most of these exceptions mirror those in the Freedom of Information Act, 5 U.S.C. 552. However, the Sunshine Act has no analog to Exemption 5 of the FOIA, 5 U.S.C. 552(b)(5), which protects, inter alia, the internal deliberations of a government agency. And, unlike the FOIA, the Sunshine Act contains an exception for meetings at which a person is accused of a crime or is censured (5 U.S.C. 552b(c)(5)), as well as exceptions protecting against the premature disclosure of certain information from agencies that regulate currency, securities, commodities, or financial institutions (5 U.S.C. 552b(c)(9)(A)); premature disclosure of information that is likely significantly to frustrate implementation of a proposed agency action (5 U.S.C. 552b(c)(9)(B)); and discussions regarding a particular adjudication or a pending court case (5 U.S.C. 552b(c)(10)). /2/ If a meeting is closed under Exemption 8 (examination, operating and condition reports by agency that regulates financial institutions) or Exemption 9 (see note 1, supra), the agency may at its option prepare a set of detailed minutes rather than a full transcript or recording. 5 U.S.C. 552b(f)(1). /3/ However, no court "having jurisdiction solely on the basis of (the Act is authroized) to set aside, enjoin, or invalidate any agency action (other than an action to close a meeting or to withhold information * * *) taken or discussed at any agency meeting out of which the violation * * * arose." 5 U.S.C. 552b(h)(2). /4/ Section 402(b) permits an appeal to the United States Court of Appeals for the District of Columbia Circuit in cases involving certain types of orders, such as the denial of a license or construction permit. /5/ In recent years, these companies have obtained operating agreements with some foreign countries. They now offer limited service in competition with respondent. /6/ Respondent also charged that the CP meetings constituted ex parte proceedings and thereby violated respondent's right to due process. See App. E, infra, 73a. /7/ The district court construed respondent's ultra vires claim as based on the Logan Act, 18 U.S.C. 953, which makes it a crime for unauthorized persons to negotiate with foreign governments, and held that only the State Department has standing to complain of the violation of that statute (App. D, infra, 63a). The court also concluded that the ultra vires claim would not be ripe until the two new carriers were accepted by the foreign entities, at which time respondent could "object through the formal rulemaking process" (ibid.). /8/ Respondent also sought disclosure under the Freedom of Information Act of certain documents related to the CP meetings. See App. E, infra, 71a n.1. The district court ordered disclosure of the documents (App. D, infra, 63a-65a), but the court of appeals reversed as to all but two of them (App. A, infra, 21a-34a). The government does not seek review of the court of appeals' decision with respect to those two documents. /9/ 47 U.S.C. 154(h). Effective July 1, 1983, the size of the Commission was reduced from seven to five members, and a quorum was therefore reduced from four to three. Pub. L. No. 97-253, title V, sec. 501(b), 96 Stat. 805 (1982). /10/ The court of appeals concluded (App. A, infra, 36a-37a; footnotes omitted) that unofficial authorization had been granted because (1) Committee members attend CP exchanges in their "official roles"; (2) their goal is to build a "consensus" that will "lead ultimately to operating agreements for ITT's competitors" and (3) they convey the information and views "exchanged" at the meetings to the full Commission for its consideration. However, similar factors will likely be present whenever representatives of an administrative agency attend an international or other conference. They are almost certain to attend in their official capacities; the conference undoubtedly will have some objective related to the agency's functions; and the representatives will probably report back to their colleagues. Thus, if the factors upon which the court of appeals relied are sufficient to show unofficial authorization and to overcome the force of regulations withholding official authorization, the presumption of administrative regularity will be eviscerated. /11/ The Act is limited to "joint" conduct. See 5 U.S.C. 552b(b) (emphasis added) ("(m)embers shall not jointly conduct or dispose of agency business other than in accordance with this section"); 5 U.S.C. 552b(a)(2) ("meeting" defined to include only "the joint conduct or disposition of agency business"). Thus, the Act does not apply where only one agency member is present. S. Rep. No. 94-354, 94th Cong., 1st Sess. 17 (1975). /12/ Agency employees, even when authorized to act on behalf of the agency, are not covered because the Act applies only to "agency" meetings, and the term "agency" is defined as a collegial body appointed by the President with the advice and consent of the Senate or any subdivision of that body (5 U.S.C. 552b(a)(1)). See S. Rep. No. 94-354, 94th Cong., 1st Sess. 17 (1975). /13/ See S. Rep. No. 94-354, 94th Cong., 1st Sess. 17 (1975). /14/ The court of appeals mentioned the term "deliberations" at one subsequent point in its opinion, stating (App. A, infra, 39a) that Commissioners participating in the CP sessions may "gather() information and opinions" that may prove useful in some unidentified future FCC deliberations. But the mere fact that attendance at an event may furnish information that may be useful in future deliberations does not mean that the event itself involves "deliberations." Reading documents or inspecting facilities may furnish such information, but those activities can hardly be termed "deliberations." /15/ In another portion of its opinion, the court of appeals essentially acknowledged that the CP discussions were not "deliberations." Rejecting the argument that certain documents prepared by FCC staff members during those conferences were protected by the deliberative process privilege from disclosure under the FOIA (App. A, infra, 31a-34a), the court wrote (id. at 34a; footnotes omitted): "It is not enough for an agency to assert that factual material "may be used" in future deliberations; the agency must demonstrate that the material at issue is inextricably intertwined with a specific deliberative proceeding." /16/ Indeed, in an apparent effort to narrow the legislation's coverage, the Conference Committee amended the bill so that it would apply only when "deliberations determine or result in the joint conduct or disposition of agency business" (5 U.S.C. 552b(a)(2)); emphasis added) rather than when they merely "concern the joint conduct of agency business" S. 5, 94th Cong., 1st Sess., Section 201(a) (1975). /17/ The Conference Report (H.R. Rep. No. 94-1441, S. Rep. No. 94-1178, 94th Cong., 2d Sess. 11 (1976)) adopted the Senate report's explanation of the term "meeting." /18/ The only authority cited by the court of appeals (see App. A, infra, 38a & n.154) for its sweeping interpretation is three isolated sentences in the House and Senate reports suggesting that public meetings and hearings are covered by the Act. See H.R. Rep. No. 94-1441, 94th Cong., 2d Sess. 7 (1976); S. Rep. 17, 18. The court then reasoned (id. at 39a-40a) that "hearings" and "meetings with the public" are indistinguishable from other discussions between agency members and outsiders. The court of appeals "read too much into these scattered bits of legislative history." Pennhurst State School v. Halderman, 451 U.S. 1, 20 (1981). There is a vast difference between agency "hearings," on the one hand, and discussions, like the CP sessions, between agency members and a small group of nonmembers, on the other. Hearings are usually formal, focus upon a particular proposal or problem -- and are usually open to the public unless a sensitive subject is being discussed, in which case one of the Sunshine Act exceptions may apply. See, e.g., 47 U.S.C. 154(j) (FCC hearings open to public upon request but may be closed to protect secret national defense information); see also 5 U.S.C. 552b(c)(1) (Sunshine Act exception for similar information). Discussions, by contrast, are frequently informal, wide-ranging, and exploratory; and privacy is often essential if they are to be useful. The other proposition upon which the court of appeals relied -- that "meetings with the public" must be open to the public -- is merely a statement of the obvious (and is based upon a single sentence in the Senate report (S. Rep. 18)). Yet the court drew heavily upon this redundancy, and thus concluded that the Act proscribes virtually all informal, off-the-record discussions between an agency or subdivision quorum and outside parties. Consequently, a sentence in the Senate report that must have seemed innocuous and self-evident to any congressman who read it is virtually the only reed supporting the court of appeals' far reaching interpretation of one of the Act's key provisions. /19/ No CP sessions have been held since the court of appeals' decision. Pursuant to an order of the court of appeals entered before this case was decided, the last CP session, held in Madrid, Spain, in October 1980, was taped, but the European participants objected strongly, and this gathering proved far less useful than its predecessors. (See Affadivit of Willard L. Demory (App. 1a-5a to FCC Br. in the court of appeals in Nos. 80-2324, 80-2401)). /20/ The court of appeals' decision stands the proper review procedure on its head because, not only does it recognize concurrent district court jurisdiction, contrary to Congress' express command, but it grants this illegitimate form of review precedence over the statutorily-mandated procedure by suggesting that the Commission "stay() further action on ITT's rulemaking petition pending the district court's resolution of the ultra vires issue" (App. A, infra, 51a-52a). Compare Whitney National Bank v. Bank of New Orleans, 379 U.S. 411, 422 (1965) (the likelihood of "duplicative procedures" and "conflicting determinations" "militate(s) in favor of the conclusion that the statutory steps provided in the Act are exclusive"). /21/ See, e.g., 15 U.S.C. 45(c) (Federal Trade Commission); 15 U.S.C. 77i, 78y, 79x (Securities and Exchange Commission); 21 U.S.C. 371(f) (Food and Drug Administration); 29 U.S.C. 160f (National Labor Relations Board). See also 3 K. Davis, Administrative Law Treatise Section 23.03 at 302-306 (1958 & 1982 Supp.); L. Jaffe, Judicial Control of Administrative Action 157 (1965). /22/ For cases involving court of appeals' review of FCC declaratory rulings, see Chisholm v. FCC, 538 F.2d 349, 364-365 (D.C. Cir.), cert. denied, 429 U.S. 890 (1976); New York State Broadcasters Ass'n v. United States, 414 F.2d 990 (2d Cir. 1969). /23/ See Harrison v. PPG Industries, Inc., 446 U.S. 578, 594 (1980). This procedure has been followed even where, as here, the factfinding concerned alleged agency impropriety. See, e.g., PATCO v. FLRA, 672 F.2d 109 (D.C. Cir. 1982); Home Box Office, Inc. v. FCC, 567 F.2d 9, 58-59 (D.C. Cir.), cert. denied, 434 U.S. 829 (1977); Sangamon Valley Television Corp. v. United States, 269 F.2d 221 (D.C. Cir. 1959). See also Writers Guild of America, West, Inc. v. American Broadcasting Co., Inc., 609 F.2d 355, 363-364 (9th Cir. 1979), cert. denied, 449 U.S. 824 (1980). Appendix Omitted