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Monday, March 11, 2013

Why Did Bloomberg's Soda Portion Ban Bite the Dust? Was it mayoral imperialism, judicial activism, or both?

Justice Milton Tingling of the New York supreme court (that's a trial judge for you non-New Yorkers) struck down Mayor Bloomberg's soda portion cap this afternoon, citing the state non-delegation doctrine and the state's administrative law constraint on arbitrary and capricious rule-making. The essence of the opinion is that defining soda portion size is above the Department's pay grade, because it is "legislative" in character, a major policy requiring the imprimatur of City Council.

Consider an oddity about Justice Tingling's non-delegation argument: His opinion holds that the Department exceeded its jurisdiction because its ban on large (+16-oz.) cups was too narrow, not because its ban was too broad. The problem with the ban is that it was not really a ban: By exempting retail food stores like 7-11 and milk-based drinks like frappuccinos and by permitting refills of 16-oz. cups, the Department was too under-inclusive in its elimination of the super-sized portions. Such exceptions and limits, Justice Tingling argued, indicated that the Department was pursuing "economic, political, and social considerations," not public health. The opinion asserted (page 15) that the Department's taking into account "the financial costs related to the chronic [obesity] epidemic" suggested an improper frolic and detour outside the agency's health-oriented mission, because such attention to financial matters "evidences a balancing being struck between safeguarding the public's health and economic considerations." Justice Tingling even mentioned in passing that the rule was under-inclusive because it exempted "private homes where food is prepared" (page 14).

How can it make sense to force the Health Department into such a judicially tailored straitjacket, requiring bureaucrats to pursue an all-or-nothing policy whenever they implement a law? Is Justice Tingling really demanding that agencies jettison consideration of cost, administrative feasibility, personal privacy, or financial feasibility when they pursue their primary mandate? Such reasoning is not unprecedented: Recall FDA v. Brown & Williamson's argument that the FDA would have to ban cigarettes entirely if they were an unsafe "medical device" and not merely regulate cigarettes' advertisements. But the under-inclusiveness argument seems like an open invitation to opportunism: No one expects, or would normally want, an agency to pursue its primary mission by ignoring every other consideration of cost or feasibility. Thus, Bloomberg's calorie-posting rule, requiring certain food retailers to post how many calories are in the food they serve, did not apply to Mom & Pop coffee houses or chic restaurants but only to chains. Why was this limit not just as unauthorized as the ban on big cups?

The only plausible way to distinguish the calorie-count rule from the cup-size rule, so it seems to me, is that the latter is more paternalistic than the former. Indeed, Justice Tingling hints that anti-paternalism plays a role in his evaluation of city charter history: "[O]ne thing not seen in any of the Board of Health's powers is the authority to limit or ban a legal item under the guise of 'controlling chronic disease,'" Justice Tingling's opinion asserts. The calorie count rule is equally a "limit" on the marketing of a "legal item," but it is not a limit on an item's consumption. In infer that limiting or banning a consumer's use of an item just seems too novel to Justice Tingling, because it is too paternalistic. The non-delegation argument is, on this reading of the opinion, largely a convenient vehicle with which to drive a non-textual, judge-made, anti-paternalism gloss into the Department of Health's otherwise unlimited statutory mandate to "regulate all matters affecting health in the city of New York" (City Charter section 556).

In short, by shrinking the Department of health's mandate, Justice Tingling enlarged his own. Should we be upset by such judicial creativity enlisted to constrain agency creativity?


In favor of Justice Tingling's anti-paternalism canon is that the doctrine simply forces Mayor Bloomberg to apply to the City Council to make controversial policy decisions. As I have elsewhere noted with respect to taxis, the Mayor has been excessively prone to bypass Council, either applying to Albany for direct state legislative authority or simply ruling by executive decree (or by the decree of mayoral sock puppets like the Department of Health).

But one might complain that judicial glosses on statutes, derived from nothing more than the judge's libertarian suspicion that an agency's intervention into the market is too novel or meddling, over-extend judicial power even as they constrain agencies' power. The Department of Health is, after all, an executive agency that is supposed to pursue policy goals. The supreme court is, by contrast, supposed to construe law. It is hard for me to see, as a matter of law, why City Charter section 556's capacious grant of power to the Department of Health, as a matter of law, does not include a mandate to limit portion size as an imperfect means for reducing obesity. There can be no serious doubt that Bloomberg's cup size rule is a good-faith effort to address obesity. Yes, lots of stores were exempted -- but can anyone reasonably expect City health inspectors to start visiting every retail outfit with a soda fountain? Yes, the measure is probably too timid to do much good (as its critics who favor more regulation complain) -- but are agencies really bound to do everything about a problem or nothing at all? No, the rule does not cover milk-based drinks -- but, undoubtedly if it had done so, then you can bet that the National Dairy Council would be suing on the ground that milk-based drinks are too nutritious to be lumped with soft drinks made essentially of sugar and water.

To be fair to Justice Tingling, he had to apply precedents from the Court of Appeals that invited an examination of the under-inclusiveness of agency rules to determine whether they pursue purposes outside their mandate. In particular, the Court of Appeals' 1987 decision in Boreali v. Axelrod held that the Department of Health could not ban indoor smoking in public places, in part resting the decision on the measure's under-inclusiveness. But Boreali rested more heavily on a theory of implied preemption of agency power by the legislature: The City Council had repeatedly refused to expand the 1975 law regulating smoking in such places as movie theaters and public libraries, and this refusal was taken as an implied ban on the Department of Health's doing so by rule.

No such lengthy track record of City Council's refusing to regulate portion size exists in this case. Justice Tingling noted that Council had passed a resolution seeking to limit the use of EBT cards to purchase soft drinks or to impose an excise tax on soft drinks (page 30). But these efforts suggest exactly the opposite of the failed legislative efforts in Boreali --namely, that City Council had not adopted an entrenched position against the measure struck down by Justice Tingling.

In short, Justice Tingling's opinion looks like a libertarian canon masquerading in non-delegation trappings. Maybe that sort of canon is good judicial policy. But I'd rather take my policy from Bloomberg, as meddlesome as he can be, than a judge.

Posted by Rick Hills on March 11, 2013 at 08:23 PM | Permalink

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Very interesting post, Rick.

Posted by: Paul Horwitz | Mar 11, 2013 8:48:09 PM

Interesting. It seems pretty clear that some underlying libertarian canon is in play, but it is certainly well disguised, in an opinion that (on a very quick skim by me just now) reads as a recitation of some points made by each side, plus a recitation of a few precedents, and rather little in the way of actual analysis.

I find it particularly bizarre that part of the problem with the Health Department's rule is that it applies to "some but not all food establishments" because it exempts establishments over which the Health Department believes it lacks jurisdiction. Imagine three agencies, each with authority over 1/3 of the relevant establishments: say we're talking about smoking, and one agency covers restaurants, one has bars, and one has nightclubs. One of the three agencies decides to impose a smoking ban. Is it arbitrary and capricious because it only covers 1/3 of the possible establishments, leaving the vast majority uncovered? How about if each of the three agencies tries it, one after the other? All arbitrary? There is something obviously absurd about saying that it's arbitrary for an agency to address the maximum scope of the problem over which it has jurisdiction. But leaving aside minor issues of milk and refills, this seems to be the linchpin of the "arbitrary and capricious" holding. Odd.

Posted by: Joey Fishkin | Mar 11, 2013 9:09:55 PM

The problem, as I think you've noted here before, is that the city council is not a terribly accountable organization. The mayor is the only city office that has high visibility, competitive elections.

Posted by: brad | Mar 12, 2013 11:14:13 AM

Thank you for providing this; it's very interesting but outside my scope of usual readings. I also am not close to NY so haven't more than heard snippets about this proposed rule.

Hopefully the comment above will at least explain what might be some very naive comments following, discussing: "The only plausible way to distinguish the calorie-count rule from the cup-size rule, so it seems to me, is that the latter is more paternalistic than the former."

Already mentioned above was that the opinion was at least in part (but apparently not primarily) based on the NY State existing constraints on arbitrary and capricious rule-making. Is there no good local caselaw in this regard? Could federal admin law cases have been borrowed, and used to make a more reasonable opinion? (One more caveat, it's been long time since I studied federal admin law, too.)

Instead of seeing the cup-size rule as an excess of paternalism, to me it would seem more an excess of capriciousness. Ineffectual whim, that is, with no real hope of any real effect. And, at that, set at an arbitrary mark (20 oz) that (a) means nothing of itself with regard to combating obesity (so far as I know) and (b) appears to be easily bypassed with permitted free re-fills.

Whereas the calorie count info requirements, even if Mom-Pop are exempted, still provide information to a majority of consumers. This assumes most consumers are not dining at Mom-Pop places; and I suppose also assumes having the information is at least recognized as being useful to consumers. And, here, access to the information itself is the benefit; to what extent people act on the benefit of their knowledge (and become less obese individually or overall) does not seem part of the equation.

Posted by: concerned_citizen | Mar 12, 2013 11:57:26 AM

This reeks of mayoral imperialism. And what would expect in a city where structurally the mayor is strong, and where this council is weak. They kowtowed to the mayor and gave him another term. Why would he expect a challenge from the city council.

Posted by: Adam | Mar 13, 2013 12:15:20 AM

Great post, Rick. A few other disturbing or questionable aspects of Judge Tingling's opinion include:

1) how backward-looking his assessment of the Department of Health's authority is. Judge Tingling discusses all of the city's charters going back to 1686 (sorry, Peter Stuyvesant - he didn't go back to New Amsterdam days) in an effort to portray the DOH's authority as limited to spreading infectious diseases. Indeed, Tingling is quite skeptical that obesity is even a "disease" within the realm of the DOH's authority to address. If he is correct, then the trans fat ban of 2006, which was also implemented administratively by the DOH, was perhaps illegal too (as well as the calorie count regulation, referred to in Rick's post). I wonder if the fast-food companies are kicking themselves for never suing on this basis.

2) The opinion is ambiguous, to say the least, about whether the DOH was exercising powers beyond its grant (akin to Chevron), or whether the DOH was granted awesome powers by the charter or state law or the city council and that this grant violates a nondelegation doctrine of some kind. Clarity in this regard would have been most helpful.

3) Ironically, the only "Boreali" prong that I thought the portion cap rule might have failed was #4, which seems to ask whether the agency exercised expertise in formulating the rule. Tingling tells us that the Board of Health (by the way, the distinction between the Board and Department of Health is quite confusing) merely accepted a proposal forwarded by the mayor's office. In this sense, one might argue that the agency failed to live up to the "Wilsonian" ideal of agency rulemaking based on science rather than politics. The narrative here makes the Board of Health look like mayoral lackeys rather than experts who exercise independent judgment. With little explanation, however, Tingling finds that the regulation passes this prong of Boreali.

4) As a supporter of the substance of the regulation, the most disturbing aspect of the decision is how it halts the rule's momentum. Various chains, including Dunkin Donuts, had already commissioned special posters and flyers explaining how to comply with the rule. Now they will feel that they wasted money trying to comply, and the many businesses that were skeptical of complying, and perhaps even planned to defy the rule, will feel emboldened. More in the media appear to be abandoning the Bloomberg proposal, as evidenced by the New York Times editorial today. It amazes me the extent to which one judge's rather poorly-reasoned opinion can hold the public in such thrall.

Posted by: Paul | Mar 13, 2013 2:12:46 PM

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