Alden Management Ser v. Chao, Elain ( 2008 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 07-3828
ALDEN MANAGEMENT SERVICES, INC.,
Plaintiff-Appellant,
v.
ELAINE CHAO, Secretary of Labor,
Defendant-Appellee.
____________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 06 C 1262—Amy J. St. Eve, Judge.
____________
ARGUED JUNE 2, 2008—DECIDED JUNE 25, 2008
____________
Before EASTERBROOK, Chief Judge, and ROVNER and
WOOD, Circuit Judges.
EASTERBROOK, Chief Judge. The Immigration Nursing
Relief Act of 1989, 8 U.S.C. §§ 1101(a)(15)(H)(i)(a), 1182(m),
allowed hospitals and other medical facilities to secure H-
1A visas for foreign nurses to work in the United States.
(This program ended in 1997. Its replacement is 8 U.S.C.
§1101(a)(15)(H)(1)(c). That change does not affect the
current controversy.) Visas issued under the Act if the
employer attested that more nurses were needed, that
employment of foreign nurses would not adversely affect
employment of U.S. citizens, and that the foreign nurses
2 No. 07-3828
would receive the same pay as citizens employed as
registered nurses at the same facilities. Visas in this
program generally lasted for five years and were not
renewable. (In other words, the program did not sup-
port immigration.)
Alden Management Services, which operates seven
nursing homes in or near Chicago, certified its need for
foreign nurses and eventually hired 119 from the Philip-
pines. It did not, however, pay them as much as it paid
registered nurses who are U.S. citizens. When the State
Department grew concerned in 1995 that some repre-
sentations made to secure the visas may have been incor-
rect, it sent a telegram to the Secretary of Labor, who
administers the program once the nurses are in the
United States. The Secretary opened an investigation. After
an unduly protracted series of hearings and administra-
tive appeals, the Secretary concluded that Alden had
paid the nurses less than their due. She ordered Alden to
make good the shortfall for the entire period that the
nurses had been employed under H-1A visas.
In this suit, Alden does not contest any of the agency’s
factual findings. Nonetheless, it insists, the back-pay
order is invalid because neither a foreign nurse nor any
domestic nurse or union complained, and because the
back-pay period should have been two years at most,
rather than the whole of the nurses’ employment. The
district court entered judgment for the Secretary. 529
F. Supp. 2d 882 (N.D. Ill. 2007).
The Act requires the Secretary to establish a system for
resolving complaints:
The Secretary of Labor shall establish a process,
including reasonable time limits, for the receipt,
No. 07-3828 3
investigation, and disposition of complaints re-
specting a facility’s failure to meet conditions
attested to or a facility’s misrepresentation of a
material fact in an attestation. Complaints may be
filed by any aggrieved person or organization
(including bargaining representatives, associa-
tions deemed appropriate by the Secretary, and
other aggrieved parties as determined under
regulations of the Secretary). The Secretary shall
conduct an investigation under this clause if there
is reasonable cause to believe that a facility fails to
meet conditions attested to. Subject to the time
limits established under this clause, this subpara-
graph shall apply regardless of whether an attesta-
tion is expired or unexpired at the time a complaint
is filed.
8 U.S.C. §1182(m)(2)(E)(ii). Alden contends that the
State Department is not an “aggrieved person or organ-
ization” and that the Secretary of Labor therefore “lacked
jurisdiction” to do anything in response to the State
Department’s telegram.
Section 1182(m)(2)(E)(ii) gives an “aggrieved person or
organization” a legal entitlement to administrative action.
We need not decide whether the State Department is an
“aggrieved” organization. Alden leaps from “if an ag-
grieved person complains, then the Secretary must act” to
“the Secretary may act only if an aggrieved person com-
plains”. The statute says the former but not the latter.
Treating “there is a private right to at least X” to mean
“the agency is forbidden to do more than X” is a logical
error. “If A then B” (if a private victim complains, then a
hearing must be held) differs from “only if A, then B” (only
a private complaint allows a hearing). Alden confuses
4 No. 07-3828
necessary and sufficient conditions. An aggrieved party’s
protest is sufficient to require an investigation but is not
necessary. Nothing in §1182(m)(2)(E)(ii), or anywhere
else in the Act, limits the Secretary’s ability to inquire
into statutory compliance.
Federal agencies usually start investigations on their
own; private complaints are neither necessary nor suf-
ficient. The SEC can tell an investor to go jump in a
lake, and the agency may limit its enforcement agenda
to internally-generated cases; §1182(m)(2)(E)(ii) says that
the Secretary of Labor may turn a deaf ear to busy-
bodies but not aggrieved persons. An obligation to act on
behalf of domestic nurses injured by foreign competi-
tion does not prevent the Secretary from acting independ-
ently to ensure that employers follow the law. Administra-
tive alertness and initiative do not transgress any federal
statute and are usually thought marks of good government.
The Secretary’s regulations provide that a private
complaint is not necessary to an investigation. 20 C.F.R.
§655.400(b). That regulation does not contradict any part
of the statute and could not be called arbitrary or capri-
cious. Agency-initiated proceedings are routine. Under
the National Labor Relations Act, for example, private
parties may file charges but only a complaint by the
General Counsel of the National Labor Relations Board
starts the formal process—and the General Counsel may
act even if no one has complained. 29 U.S.C. §§ 153(d),
160. Some statutes give private parties a right to be heard,
but very few make that route exclusive. Although Title
VII of the Civil Rights Act of 1964 usually requires a
private charge, the Attorney General or any Commissioner
of the EEOC may initiate a proceeding. See 42 U.S.C.
§2000e–5(b), (f). A system that makes a complaint by
No. 07-3828 5
a private victim indispensable is conceivable, but
§1182(m)(2)(E)(ii) does not create one.
This leaves Alden’s argument that the back-pay period
should have been shorter. This argument, too, rests on
a logical error. Alden apparently believes that that a
period of limitation affects how long a damages period
may run after the proceeding has begun, as well as how
long before its commencement damages may go back. That
is not how a statute of limitation works. The period speci-
fies how far before the case begins the remedy may
reach. See National Railroad Passenger Corp. v. Morgan,
536 U.S. 101 (2002). It has nothing to do with whether a
remedy may be awarded for time after the proceeding
begins, during which the wrong continues. Once an
administrative proceeding gets under way, back pay
may be awarded for as long as the worker continues to
receive less than the law requires. See, e.g., NLRB v.
Ironworkers, 466 U.S. 720 (1984); NLRB v. J.H. Rutter-Rex
Manufacturing Co., 396 U.S. 258 (1969).
What’s more, nothing in the Act establishes a period
of limitations for the Secretary’s proceeding. Alden be-
lieves that the Secretary (or a court) should borrow a
limit from another law, but a borrowing approach—
which has been superseded for post-1990 federal
statutes by 28 U.S.C. §1658(a); Jones v. R.R. Donnelley &
Sons Co., 541 U.S. 369 (2004)—does not apply to administra-
tive proceedings initiated by the national government.
Unless a federal statute directly sets a time limit, there is
no period of limitations for administrative enforcement
actions. See BP America Production Co. v. Burton, 549 U.S. 84
(2006); Intercounty Construction Corp. v. Walter, 422 U.S. 1
(1975).
According to Alden, the Secretary violated the due
process clause of the fifth amendment by adopting and
6 No. 07-3828
then abandoning several different, and incompatible,
views about the appropriate back-pay period. We don’t
see what the Constitution has to do with this. The Admin-
istrative Procedure Act entitles private parties to fair
hearings. 5 U.S.C. §554(c). Cf. Rehman v. Gonzales, 441
F.3d 506 (7th Cir. 2006). Alden does not contend that the
agency violated §554 or any regulation by revising its
legal arguments as the case proceeded. An agency that
propounds a mistaken legal view not only may but also
should correct it. Courts don’t hold a party to its first
legal theory. One does not plead law, see Bartholet v.
Reishauer A.G. (Zürich), 953 F.2d 1073 (7th Cir. 1992), and
under Fed. R. Civ. P. 54(c) the judgment awards the
prevailing party its legal entitlement whether or not that
party has correctly understood its rights and demanded
exactly its legal due. Counsel for Alden acknowledges
that Rule 54(c) is constitutional; if that is so it is im-
possible to see how the due process clause binds the
Secretary to an early, and mistaken, view of the length
of the back-pay period.
A belated shift in legal position could make the adminis-
trative decision arbitrary, and justify relief under the
APA, if it prevented the private party from introducing
facts that are material under the agency’s new view but
not its old one. That did not happen here, however. The
agency decided during an interlocutory administrative
appeal that foreign nurses are entitled to back pay for
the entire length of their work under H-1A visas. It con-
cluded that what matters is whether the foreign nurses
received wages below those of domestic registered
nurses, rather than the timing or content of Alden’s
attestations (which led to the H-1A visas). Alden then had
another hearing. Alden deems this inadequate because the
No. 07-3828 7
administrative law judge was bound by the appellate
decision establishing the legal principles. But Alden
had ample opportunity to adduce any facts that affected
its back-pay obligation. Instead of demanding that the
Secretary prove the relevant facts, Alden and the Secre-
tary’s lawyers stipulated how much back pay Alden owes
under the Secretary’s legal position. Whether the Secre-
tary’s position is correct is a subject open to decision in
court. The goal of the hearing was to elicit all facts that
matter, given the applicable law. That a statute, regulation,
or higher tribunal tells an ALJ what legal rules to apply
does not make an evidentiary hearing illusory.
The agency gave Alden an opportunity to be heard on
all factual issues material to its ultimate decision. And, as
we have concluded that the Secretary’s legal position is
correct, the judgment of the district court is
AFFIRMED.
USCA-02-C-0072—6-25-08