Please offer a well reasoned and articulate discussion on cases which includes the rationale for the decision in same along with the ramifications thereof for business and society.

Administrative Law

Case 37.1: Loving v. Internal Revenue Service

Responding to concern about the performance of some paid tax-return preparers, the Internal Revenue Service (IRS) issued a new rule. The rule required paid preparers to pass an initial certification exam, pay annual fees, and complete fifteen hours of continuing education courses each year. As authority for the rule, the IRS relied on a statute enacted in 1884 that authorizes the agency to "regulate the practice of representatives of persons before the Department of the Treasury." Three preparers filed a suit in a federal district court against the IRS, contending that the rule exceeded the agency's authority. The court ruled in the plaintiffs' favor.

The U.S. Court of Appeals for the D.C. Circuit affirmed. The IRS interpreted the statute to "empower [the agency] for the first time to regulate hundreds of thousands of individuals in the multi-billion dollar tax-preparation industry." Nothing in the statute's text, history, structure, or context "contemplates that vast expansion of the IRS's authority."

Case 37.2: Federal Communications Commission

v. Fox Television Stations, Inc.

The Federal Communications Commission (FCC) polices "indecent" speech"language that describes, in terms patently offensive as measured by contemporary community standards for the broadcast medium, sexual or excretory activities and organs." The FCC had long ignored "fleeting expletives." During a broadcast of the Golden Globe Awards, Bono commented, "this is really, really, fxxking brilliant." On a complaint about the broadcast, the FCC held that any use of "the F-Word" inherently has sexual connotation and falls within the scope of the indecency definition. During broadcasts of other awards shows, similar expletives were used, and the FCC ruled similarly. Fox Television Stations, Inc., filed for review. The U.S. Court of Appeals for the Second Circuit vacated the FCC's order against the broadcasters, and remanded the case. The FCC appealed.

The United States Supreme Court reversed and remanded. "A court is not to substitute its judgment for that of the agency" and should "uphold a decision of less than ideal clarity if the agency's path may reasonably be discerned." An agency must show good reasons for a new policy. "But it need not demonstrate to a court's satisfaction that the reasons for the new policy are better than the reasons for the old one; it suffices that the new policy is permissible under the statute, that there are good reasons for it, and that the agency believes it to be better." Here, it was "reasonable to determine that it made no sense to distinguish between literal and nonliteral uses of offensive words" when "a safe harbor for single words would likely lead to more widespread use of the offensive language."

Case 37.3: Craker v. Drug Enforcement Administration

Lyle Craker, a professor at the University of Massachusetts, applied to the U.S. Drug Enforcement Administration (DEA) to make marijuana for clinical research into its medical uses. An administrative law judge recommended that Craker's application be granted, but a DEA Deputy Administrator denied his application. The Administrator determined that the professor did not prove that effective controls against its diversion from his clinical research were in place or that supply and competition were inadequate, as required under the Controlled Substances Act (CSA). Craker appealed the denial.

The U.S. Court of Appeals for the First Circuit denied Craker's petition to review the agency's order. "The Administrator's interpretation of the CSA is permissible and her findings are reasonable and supported by the evidence."