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Supreme Court and Appellate Update

U.S. Supreme Court Poses New Questions About the Scope of Hobbs Act Review

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On June 20, in PDR Network, LLC v. Carlton & Harris Chiropractic, Inc., the U.S. Supreme Court vacated a decision of the U.S. Court of Appeals for the Fourth Circuit that had been adverse to the interests of our client, PDR Network. Both the majority and concurring opinions in PDR Network raise interesting issues for lower courts to ponder as they consider how much to defer to agency decision making.

Specifically, the Court’s opinion provides defendants with the potential to expand opportunities for judicial review of orders issued by the Federal Communications Commission (FCC), the Surface Transportation Board, the Federal Maritime Commission and other agencies. The full ramifications of the opinion are uncertain, however, because the Court raised several questions but resolved none. Specifically, the Court expressly declined to answer the question it had agreed to review: whether the Hobbs Act (28 U.S.C. § 2342) requires a district court to accept the FCC’s legal interpretation of the Telephone Consumer Protection Act (TCPA) in a private enforcement action.

Instead, the Court remanded the case to the Fourth Circuit to consider two “preliminary issues”: (1) whether the FCC interpretation at issue is an interpretive, rather than legislative, rule and, if so, whether it is therefore not binding in the district court; and (2) whether PDR had a “prior” and “adequate” opportunity to seek judicial review of the FCC’s interpretation under the Hobbs Act and, if not, whether it can therefore argue, in defending against an enforcement suit, that the court should not apply the FCC’s interpretation. These questions raise the possibility that parties will be able to challenge agency orders covered by the Hobbs Act outside the 60-day review window provided by the Act, at least when those orders form the basis of an enforcement action initiated by a private plaintiff, just as prevailing case law has long permitted when such orders form the basis of an enforcement action initiated by the agency itself.

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