The opinion of the court was delivered by: POLLAK
These two cases, Cerro Metal Products v. Marshall, No. 78-3713, and Fleck Industries, Inc. v. Marshall, No. 79-77, are entirely separate lawsuits, but they present a common question of law. For that reason, they have been consolidated for argument and are dealt with together in this opinion.
The question of law linking the cases is rooted in Marshall v. Barlow's, Inc., 436 U.S. 307, 98 S. Ct. 1816, 56 L. Ed. 2d 305 (1978), which considered the validity of a key enforcement provision of the Occupational Safety and Health Act of 1970. 29 U.S.C. § 651, Et seq. That Act vests in the Secretary of Labor, as statutory head of the Occupational Safety and Health Administration (OSHA), broad powers and responsibilities to reduce hazards to life and health in the working environment of over sixty million people employed in enterprises affecting interstate commerce. "In order to carry out the purposes of this chapter, the Secretary is authorized," by Section 8(a), "to enter without delay and at reasonable times . . . and . . . to inspect and investigate during regular working hours and at other reasonable times," 29 U.S.C. § 657(a), the upwards of five million workplaces throughout the nation which are covered by the Act. The Supreme Court in Barlow's held Section 8(a) "unconstitutional insofar as it purports to authorize inspections without warrant or its equivalent . . ." 98 S. Ct. at 1827. Based upon this holding, the Court affirmed the decree of a three-judge District Court enjoining Secretary Marshall from carrying out warrantless inspections.
Cerro Metal Products v. Marshall
Cerro Metal Products v. Marshall is, chronologically, the first of the two cases now before this Court. It had its beginnings in September of 1978 four months after the decision in Barlow's when an employee of Cerro Metal Products was killed at the Cerro plant in Bellefonte, Pennsylvania. Advised of the fatal accident, an OSHA inspector presented himself at the plant that very day: he appears to have been admitted at once, without a warrant; and he thereupon spent the balance of that day and the next day on the premises. During October, (1) an OSHA citation issued alleging a violation of the Act; (2) Local 1282 of the United Auto Workers (the local union which is the certified collective bargaining representative of Cerro's employees) complained to OSHA about other alleged safety and/or health hazards; and (3) relations between Cerro management personnel and OSHA field officers became increasingly strained and mistrustful. At the beginning of November, the OSHA inspector who had been at the plant in September notified Cerro that he intended to conduct further inspections five days a week for three or four weeks. Cerro management indicated that the inspections would be assented to only subject to certain conditions, (a) relating to scope and probable cause, and (b) including an understanding that a Cerro industrial hygienist would accompany OSHA's industrial hygienist throughout the inspections. These conditions were entirely unacceptable to OSHA. When Matthew Rieder, Esq., a staff attorney for OSHA, advised Cerro personnel that OSHA would seek an Ex parte warrant on November 6, 1978, Cerro, on the morning of November 6, 1978, launched its own preemptive strike initiating this equity proceeding against Secretary Marshall, Regional Administrator Rhone, and Mr. Rieder. The gravamen of Cerro's complaint was that (1) the extended inspection planned by the OSHA field staff was unjustified because it was part of a pattern of OSHA harassment of Cerro; (2) OSHA personnel hoped to gather evidence of crime through the subterfuge of resort to civil process; and (3) OSHA in any event had no authority to seek an inspection warrant Ex parte. Accordingly, Cerro sought a decree enjoining the defendants from trying to obtain a "broad-ranging search warrant" as an instrument of (1) agency harassment, or (2) subterfuge; and Cerro also (3) asked that defendants be enjoined from seeking any inspection warrant without giving plaintiff such notice as would permit it to appear and oppose OSHA's demand for compulsory inspection process.
On November 9, 1978, I heard argument on plaintiff's request for a temporary restraining order. On the following day, I ruled from the bench on that request:
(1) I did not formally dispose of plaintiff's claim that OSHA's intention to undertake additional and in-depth inspections was in a dual sense an abuse of process ((1) part of a pattern of harassment; (2) a search for evidence of crime under the guise of civil process). But in my bench opinion I indicated serious doubt that plaintiff could, if put to full proof, prevail on either theory.
(2) I did conclude, however, that, although I regarded the matter as "not wholly free from doubt," plaintiff Cerro was right in its contention that Secretary Marshall and his subordinates lacked authority to seek an inspection warrant Ex parte. My holding rested on my reading of Justice White's opinion for the court in Barlow's an opinion which is itself at certain points responsive to, if not fully acquiescent in, submissions made to the Court with respect to OSHA's enforcement procedures by former Secretary Usery (in OSHA's jurisdictional statement) and incumbent Secretary Marshall (in OSHA's brief on the merits). Justice White, in demonstrating that a constitutional mandate to proceed by warrant would not seriously hamper the Secretary in the fulfillment of his enforcement responsibilities, noted that 29 CFR § 1903.4
(hereinafter referred to as "Section 1903.4": a regulation implementing Section 8(a) adopted by the Secretary in 1971 and still in force when Barlow's was decided) itself contemplated that, where an OSHA inspector was denied entry, the inspector's superiors would take "appropriate action, including compulsory process, if necessary." In my bench opinion, I then went on to quote (with interstitial comments) the next following sentences in Justice White's opinion sentences which, as I understood them, reflected the Supreme Court's reading of Section 1903.4 as meaning not merely that the Secretary would, where entry is refused, seek an inspection warrant ("compulsory process"), but that the request for the warrant would itself be with notice to the proprietor whose premises were sought to be inspected (98 S. Ct. at 1823-24; footnotes omitted):
The regulation represents a choice to proceed by process where entry is refused; and on the basis of evidence available from present practice, the Act's effectiveness has not been crippled by providing those owners who wish to refuse an initial requested entry with a time lapse while the inspector obtains the necessary process. Indeed, the kind of process sought in this case and apparently anticipated by the regulation provides notice to the business operator. If this safeguard endangers the efficient administration of OSHA, the Secretary should never have adopted it, particularly when the Act does not require it. Nor is it immediately apparent why the advantages of surprise would be lost if, after being refused entry, procedures were available for the Secretary to seek an Ex parte warrant and to reappear at the premises without further notice to the establishment being inspected.
From the foregoing (and from language of similar tenor in footnotes to Justice White's opinion), I deduced that the Court majority had found that under his own existing regulations the Secretary did not have the arrow labeled "Ex parte warrant" in his quiver. I noted that the Secretary could, if he now deemed such authority essential, acquire it with relative ease by undertaking to amend Section 1903.4. But I concluded that, in the meanwhile, the Secretary like other high officials of the executive branch owed it to those he governed to abide by his own regulation.
Whereupon, I entered a temporary restraining order directing Secretary Marshall and the other defendants not to seek an inspection warrant without giving due notice to plaintiff.
On November 27, 1978, I entered a preliminary injunction in the same vein as the temporary restraining order, and based on the grounds recited from the bench on issuance of that order.
On December 28, 1978, the Secretary and the other defendants filed a motion asking that the preliminary injunction of November 27 be dissolved or modified "so that it shall have no prospective effect to prohibit defendants from seeking an Ex parte inspection warrant . . .." The ground for the motion was the publication in the Federal Register, on December 22, 1978, by Dr. Eula Bingham, Assistant Secretary of Labor, of an amended Section 1903.4. The amended regulation, which was filed with the Federal Register on December 21 to take effect on December 22, provides, Inter alia, that "For purposes of this section, the term compulsory process shall mean the institution of any appropriate action, including Ex parte application for an inspection warrant or its equivalent." The Federal Register for December 22 contains not only the amended Section 1903.4 but, introducing the text of the amended regulation, certain expository materials which undertake to explain at some length the reasons for the amendment. The introductory materials include the following "Summary":
This amendment to 29 CFR 1903.4 clarifies the existing regulation respecting the legal action to be taken to permit inspection of a workplace over an employer's objection. Specifically, the revised regulation makes it clear that the term "compulsory process" as used in the regulation has been, and is, intended to include all legal action necessary to secure entry to the workplace, including Ex parte application for an inspection warrant or its equivalent. The amendment also makes plain that compulsory process, as so defined, may be secured prior to an employer's objection to an inspection or investigation. The procedures for taking appropriate action to obtain entry have also been modified to promote administrative convenience.
Supporting the defendants' motion to dissolve or modify the preliminary injunction is UAW Local 1282, which, as the certified bargaining representative of Cerro's employees, has been granted leave to intervene as a party defendant.
Plaintiff opposes defendants' motion to dissolve or modify the preliminary injunction, contending that the December 22, 1978, amendment of Section 1903.4 is, notwithstanding its unambiguous language and purpose, ineffective to authorize defendants to seek inspection warrants Ex parte. In plaintiff's view, the amended regulation is invalid because it was promulgated hastily and unilaterally, in a manner which does not conform to the rule-making procedures specified in the Administrative Procedure Act. 5 U.S.C. § 551 Et seq. Specifically, Cerro argues that pursuant to the Administrative Procedure Act (5 U.S.C. § 553), the Secretary was required to give at least thirty days notice, with opportunity for comment, with respect to his proposed new Section 1903.4, before putting it into effect. The Secretary contends that the revision of Section 1903.4 was not subject to this requirement because it falls within the exemption established by 5 U.S.C. § 553(b)(A) for an "interpretative rule, general statement of policy, or rule of agency organization, procedure or practice."
Fleck Industries, Inc. v. Marshall
The second of the cases consolidated for argument and opinion is Fleck Industries, Inc. v. Marshall. On January 9, 1979, Fleck Industries brought suit to enjoin Secretary Marshall and other OSHA officials from seeking an Ex parte warrant to inspect plaintiff's plant at Willow Grove, Pennsylvania. Plaintiff alleged that it had permitted one inspection, and had agreed to a further inspection as soon as a particular industrial operation was to be repeated. But, so plaintiff alleged, OSHA intended to make other and unrelated inspections which plaintiff would not consent to because they were lacking in probable cause. Fleck's suit was intended to insure that defendants would not secure an inspection warrant without according Fleck an opportunity to demonstrate, before the magistrate or judge from whom a warrant might be sought, that OSHA's asserted reasons for the proposed additional inspections were insubstantial. Fleck sought a temporary restraining order, and subsequent injunctive relief, modeled on the preliminary injunction entered in favor of plaintiff in Cerro Metal Products v. Marshall, supra, on November 27, 1978.
Defendants contended that no temporary restraining order could properly issue. In essence, defendants' position was and is: (1) Cerro was wrongly decided; and (2) even if, Arguendo, a preliminary injunction was plausibly proper in Cerro on November 27, 1978, the December 22 amendment of Section 1903.4 undercut any residual claim to doctrinal authority the Cerro opinion had in Cerro itself, let alone as precedent for any other lawsuit. But the plaintiff in Fleck regards defendants' reliance on amended Section 1903.4 as unavailing, for the reasons advanced by plaintiff in Cerro.
Thus, Fleck seems to present the same question of law posed by the Secretary's motion to dissolve or modify the Cerro injunction namely, whether amended Section 1903.4 has effectively replenished the Secretary's Ex parte warrant armory, to the extent that it may have been depleted by my rulings in Cerro. Since the question of law is one of first impression, and arises in a setting with which I have become somewhat familiar, via the opening phases of Cerro, I agreed with my colleague, Judge Hannum, to whom Fleck had been randomly assigned, that there would be some saving in judge-time if I accepted a transfer of Fleck from his docket to mine.
Thereupon, the parties agreed that the argument and disposition of the Fleck application for a temporary restraining order could be postponed to permit consolidation with the Secretary's motion to dissolve or modify the Cerro injunction.
In the Secretary's
Reply Memorandum in support of his motion to dissolve or modify the Cerro injunction,
it is argued, with respect to the proper construction of Section 1903.4 in its pristine form, "that compulsory process, whether by warrant or equivalent process, was always intended by the agency to be Ex parte in nature." P. 4. That the OSHA field staff may frequently have sought inspection warrants Ex parte there seems no reason to doubt.
But there plainly was no uniform practice to that effect. In the very case which came before the Supreme Court in Barlow's, after Ferral G. "Bill" Barlow refused to let OSHA Compliance Officer Sanger conduct a routine inspection of his Pocatello plumbing and heating installation business, the Secretary filed with the District Court in Boise an "Application for Affirmative Order to Grant Entry and for an Order to show cause why such affirmative order should not issue." Thereafter, an adversary hearing was conducted; and in due course there issued the "Affirmative Order" sought by the Secretary. Barlow's, Inc. v. Usery, 424 F. Supp. 437, 439 (D.Idaho 1976). Thus was the stage set for Ferral G. "Bill" Barlow's application for the three-judge court in which he challenged successfully, in the event the Secretary's assertion that the Act contemplated warrantless inspections and, so construed, was constitutional. Thus, it was against this background that Justice White, in developing the proposition that a constitutional rule requiring a warrant would not significantly impede OSHA enforcement, pointed out that Section 1903.4 itself embodied an administrative election to go to court for "compulsory process" where entry was refused. The Justice's point was that there was no evidence that the Secretary's decision to enlist judicial back-up for inspections had created enforcement difficulties, notwithstanding that "the kind of process sought in this case and apparently anticipated by the regulation provides notice to the business operator." 98 S. Ct. at 1823. That this was in no sense a casual observation is apparent from the sentences immediately following: "If this safeguard endangers the efficient administration of OSHA, the Secretary should never have adopted it, particularly when the Act does not require it." Id. at 1823-24. Driving the point home, Justice White made it clear that if petitioning for a warrant With notice, as in Barlow's, would rob the Secretary of the important enforcement leverage of surprise, he could change his mode of operation so that, "after being refused entry, procedures were available for the Secretary to seek an Ex parte warrant and to reappear at the premises without further notice . . .." Id. at 1824. In order to accomplish this, Justice White indicated that what the Secretary would have to do but all he would have to do would be to change his own regulations: "Insofar as the Secretary's statutory authority is concerned, a regulation expressly provided that the Secretary could proceed Ex parte to seek a warrant or its equivalent would appear to be as much within the Secretary's power as the regulation currently in force and calling for "compulsory process.' " Id. at n. 15.