Authority of the United States to Enter Settlements Limiting the Future Exercise of Executive Branch Discretion

Authority of the United States to Enter Settlements Limiting
the Future Exercise of Executive Branch Discretion
The A ttorney G eneral m ay en ter into settlem ents that w ould lim it the future exercise o f executive
b ran ch d iscretion w hen that discretion h a s been conferred upon the executive branch pursuant to
statu te and there exists no independent statutory lim itation on the authority o f the executive branch
to so lim it the future exercise o f that discretion.
T he A ttorney G en eral’s pow er to enter into settlem ents that w ould lim it the future exercise o f discretion
th at has been conferred upon the executive branch directly by the C onstitution is constrained by
the very constitutional provisions that vest discretionary authority in the P resident and therefore
necessarily p reclude the President fro m subjecting th e exercise o f that discretion to the control
o f the o th er party to a settlem ent or to ju d icial enforcem ent.
A rticle III o f the C o nstitution does not preclude the executive branch from entering into judicially
enforceable, d iscretion lim iting settlem ents as a general m atter o r bar federal courts from entering
co n sen t decrees that lim it executive b ran ch discretion w henever such decrees purport to provide
b ro ad er relief than a court could have aw arded pursuant to an ordinary injunction. A rticle III lim ita­
tio n s m ay arise, how ever, when, for exam ple, the term s o f the governm ental prom ise are too am or­
p h ous to be susceptible to Article III fed eral judicial enforcem ent.
A lthough there m ay be sound policy reaso n s to reaffirm A ttorney G eneral M eese’s 1986 policy regu­
lating the use o f d iscretion limiting settlem ents, the concerns that led to its adoption do not, in
general, am ount to legally binding lim itations on the scope o f the executive branch’s pow er to
settle litigation in a m anner that may lim it the future exercise o f executive branch discretion.
June 15, 1999
M e m o r a n d u m O p in io n f o r t h e A s s o c i a t e A t t o r n e y G e n e r a l
This memorandum addresses the degree to which federal law places restrictions
on the authority of the United States to enter into litigation settlements that purport
to limit the exercise of executive branch discretion.1 It focuses primarily on the
concerns about the legality of discretion-limiting settlements that led to the adop­
tion of Attorney General Meese’s 1986 policy regulating the use of such settle­
ments by attorneys acting under the supervision of the Attorney General. In doing
so, the memorandum addresses a central legal tenet of Attorney General Meese’s
policy: that it is unconstitutional for the courts to enter consent decrees limiting
the exercise of executive branch discretion where the courts would not have had
the power to order such relief had the matter been litigated.
Attorney General Meese issued the 1986 policy on consent decrees and settle­
ment agreements pursuant to his litigation and settlement authority. The policy
‘ For purposes o f this memorandum, the term “ settlements” is employed to refer to both settlement agreements
and consent decrees. There are, however, practical and legal distinctions between settlement agreements and consent
decrees. Settlement agreements are simply private contracts, which may be enforced upon breach. Consent decrees
are court orders, which may be enforced immediately by contempt and may be modified over the objections of
the parties to them. See U nited States v Sw ift & Co , 286 U S. 106 (1932); Timothy Stoltzfus Jost, Com mentary
The Attorney G eneral's Policy on Consent Decrees and Settlement Agreements, 39 Admin. L. Rev 101, 109-10
(1987)
126
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
requires the Attorney General, the Deputy Attorney General, or the Associate
Attorney General, to approve proposed consent decrees or settlement agreements
that:
(1) commit the executive branch to expend unappropriated funds
or seek appropriations from Congress;
(2) commit the executive branch to promulgate, amend, or revise
regulations; or
(3) divest discretionary power granted by Congress or the Constitu­
tion to respond to changing circumstances, to make policy or mana­
gerial choices, or to protect the rights of third parties.2
Determining whether a settlement of the type identified in the Meese Policy
conforms to federal law requires a close analysis of the relevant statutory and
constitutional provisions. A context-specific inquiry is beyond the scope of this
memorandum, however, and thus our intent is to set forth the basic approach that
should guide an evaluation of the legal validity of executive branch settlements
that purport to limit the exercise of executive branch discretion.3
Our analysis proceeds with a summary of our legal conclusions. We then outline
our understanding of the basic parameters of the Meese Policy and the types of
settlements to which it is directed. Next, we set forth the general legal principles
that establish the background against which the types of settlements identified
in the Meese Policy must be evaluated. Finally, we apply the general legal prin­
ciples to the types of settlements to which the Meese Policy is directed.
I. Summary of Conclusions
Due to the length of this memorandum, it is useful to state our conclusions
in summary form at the outset. In general, we conclude that the Attorney General
is free to enter into settlements that would limit the future exercise of executive
branch discretion when that discretion has been conferred upon the executive
branch pursuant to statute and there exists no independent statutory limitation on
2 See Memorandum for All Assistant Attorneys General and All United States Attorneys, from Edwin Meese III,
Attorney General, R e • Department Policy Regarding Consent Decrees and Settlement Agreements at 3, 4 (Mar. 13,
1986) ( “ Meese Policy” ). Regulations reflecting the Meese Policy are set forth at 28 C F R §§0.160-0.163 (1998)
3 “ General principles may be drawn from dictum in cases dealing with the constitutional prohibition on state
laws impairing the obligation o f contracts, U.S Const art. 1, § 10, from cases upholding one administration’s decision
to change a policy adopted by its predecessors; from cases limiting the power of the judiciary, in the absence of
any contract, to direct the Executive in the exercise of its discretion; and from cases holding that particular contracts
made by one Administration are binding on its successors However, these broad principles might point to different
results in different contexts, depending on the legal nghts o f the private party, the type of policymaking discretion
involved, and the extent to which, and for how long, the government’s discretion is curtailed.” National Audubon
Soc’y, Inc. v. Watt, 678 F.2d 299, 305 n 12 (D.C. C ir 1982)
127
Opinions o f the Office o f Legal Counsel in Volume 23
the authority of the executive branch to so limit the future exercise of that discre­
tion. Significant general statutory limitations that, among others, must be consid­
ered in evaluating the lawfulness of possible discretion-limiting settlement terms
are those contained in the Administrative Procedure Act, which sets forth restric­
tions on the manner in which the executive branch may adopt and revise regu­
latory rules and procedures, and the Anti-Deficiency Act, which restricts the
authority of executive branch actors to incur financial obligations on behalf of
the United States. With respect to settlements that would limit the future exercise
of discretion that has been conferred upon the executive branch directly by the
Constitution, such as the discretion that is conferred upon the President by the
Pardon Power or the Recommendations Clause, the scope of the Attorney Gen­
eral’s settlement power is constrained by the very constitutional provisions that
vest discretionary authority in the President and therefore necessarily preclude the
President from subjecting the exercise of that discretion to the control of the other
party to a settlement or to judicial enforcement.
In addition, we conclude that Article III may place independent constitutional
limitations on the power of federal courts to enforce settlements that the Attorney
General otherwise would have the legal authority to enter. These limitations may
arise when, for example, the terms of the governmental promise are too amorphous
to be susceptible to Article III federal judicial enforcement. We do not believe,
however, that Article HI precludes the executive branch from entering into
judicially enforceable discretion limiting settlements as a general matter or that
Article III bars federal courts from entering consent decrees that limit executive
branch discretion whenever such decrees purport to provide broader relief than
a court could have awarded pursuant to an ordinary injunction.
From these general conclusions, it is possible to set forth in summary form
the main determinations that we have reached regarding the extent to which fed­
eral law would preclude discretion-limiting settlements of the type that are subject
to the requirements of the Meese Policy.
First, the Meese Policy in sections 11(A)(2) and 11(B)(2) raises concerns about
the authority of the executive branch to enter into settlements that would commit
the United States to expend unappropriated funds or seek appropriations from
Congress. See Meese Policy at 3-4. We conclude that there is no per se constitu­
tional bar against executive branch settlements that obligate the future expenditure
of unappropriated funds. As the Antideficiency Act itself makes clear, Congress
may authorize the executive branch to obligate funds in advance of appropriations.
Thus, settlements that incur such obligations are permissible so long as there is
statutory authority, whether explicit or implicit, for the assumption of the future
financial obligation. Implicit authority to assume such obligations should not be
readily inferred from general statutory authority, however, nor should the interest
in settling litigation be thought in and of itself, at least as a general matter, to
justify a construction of general statutory authority that would suffice to permit
128
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
such an obligation to be incurred. We also conclude that the Constitution does
limit the ability of the executive branch to settle litigation on terms that would
require executive branch officers to seek appropriations from Congress. This
limitation arises primarily from the Recommendations Clause.
Second, the Meese Policy in sections 11(A)(1) and 11(B)(1) raises concerns about
the authority of the executive branch to enter into settlements that would convert
the otherwise discretionary authority of executive branch agencies to promulgate,
amend, or revise regulations into a mandatory regulatory duty. See Meese Policy
at 3. We conclude that there is no per se constitutional prohibition against such
settlements, and that, in the main, the executive branch’s authority to enter into
settlements that impose such limitations will be determined by the statutes that
govern the executive branch agency on whose behalf the settlement would be
entered. We emphasize that the Administrative Procedure Act generally limits the
manner by which executive branch agencies may adopt, amend, or revise regu­
latory rules and procedures, and thus that it will be important to ensure that the
terms of any settlement limiting the otherwise discretionary regulatory authority
of an executive branch agency conform to the terms of that Act.
Third, the Meese Policy in sections 11(A)(3) and 11(B)(2) raises concerns about
the authority of the executive branch to divest discretionary power granted by
Congress or the Constitution to respond to changing circumstances, to make policy
or managerial choices, or to protect the rights of third parties. See Meese Policy
at 3—4. Here, we conclude that there is no per se constitutional prohibition against
settlements of this type that divest discretionary power granted by Congress, and
that, in the main, the executive branch’s authority to enter into such settlements
will be determined by the statutes that govern the executive branch agency on
behalf of which the settlement would be entered. However, the Constitution does
bar settlements that would divest the executive branch of discretionary power that
has been conferred directly by the Constitution, such as the Recommendations
Power or the Pardon Power. In addition, while the executive branch may not settle
on terms that would infringe the constitutional rights of third parties, there is no
independent constitutional limitation on the authority of the executive branch to
enter settlements that would constrain the federal government’s discretion to pro­
tect the non-constitutional interests of third parties. There may be, however, statu­
tory provisions that protect the interests of third parties, such as the notice and
comment requirements of the Administrative Procedure Act, that limit the settle­
ment authority of the executive branch.
In sum, our review leads us to conclude that there are statements in the Meese
Policy that appear to adopt an overly narrow view of the legal authority of the
Attorney General to settle litigation. In addition, we conclude the policy’s distinc­
tion between the rules that govern settlement agreements and consent decrees is
not one that a concern about the legal authority of Article III federal courts would
justify. For these reasons, we conclude that while there may be sound policy rea­
129
Opinions o f the Office o f Legal Counsel in Volume 23
sons to reaffirm the Meese Policy, the concerns that led to its adoption do not,
in general, amount to legally binding limitations on the scope of the executive
branch’s power to settle litigation in a manner that may limit the future exercise
of executive branch discretion.
II. Background Assumptions
Before proceeding to a consideration of the legal principles that define the scope
of the Attorney General’s settlement power, it is useful to set forth the background
assumptions that govern our understanding of the Meese Policy and that underlie
our analysis of the lawfulness of the types of settlements that are subject to the
requirements of that policy.
As we have suggested, it is not entirely clear whether the restrictions set forth
in the Meese Policy are rooted in policy or legal concerns. The Meese Policy
does not by its terms appear to be premised on a conclusion that the Constitution
or other federal law precludes the Attorney General from entering into settlements
that would limit the future exercise of executive branch discretion. The Meese
Policy does not actually preclude the United States from entering into any settle­
ments; it simply requires that certain settlements — i.e., those that purport to limit
executive branch discretion — be approved by the Attorney General, the Deputy
Attorney General, or the Associate Attorney General. See Meese Policy at 4. In
this respect, the Meese Policy appears to reflect a policy judgment about how
settlements decisions of certain types should be made within the Department of
Justice (“ Department” ) rather than a legal conclusion regarding the extent of the
Attorney General’s lawful power to enter into certain kinds of settlements.
Nevertheless, there are some indications that the Meese Policy is rooted in legal
concerns regarding the constitutionality of discretion-limiting executive branch
settlements. The policy declares that it is intended to respond to concerns that,
in some cases, executive branch settlements have improperly authorized federal
courts to oversee the exercise of executive branch discretion and thereby have
infringed upon executive branch prerogatives in violation of the constitutional
separation of powers. See Meese Policy at 1. Furthermore, the Meese Policy
asserts that it is designed to “ ensure that litigation is terminated in a manner
consistent with the proper roles of the Executive and the courts.” Id.', see also
Transcript of Press Conference with Charles J. Cooper, Assistant Attorney Gen­
eral, Office of Legal Counsel at 2-3 (Mar. 21, 1986) (“ Cooper Press Con­
ference” ).
While there may be sound policy reasons for centralizing the process for
approving certain lawful compromises that would limit executive branch discre­
tion, see Stoltzfus Jost, supra at 105-06, this memorandum considers only the
degree to which the Constitution, or other federal law, as a general matter, limits
the use of settlements by the executive branch that purport to circumscribe the
130
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
exercise of executive branch discretion. Thus, the memorandum is intended to
make clear the degree to which the limitations imposed by the Meese Policy are
properly rooted in constitutional or other legal concerns rather than to set forth
the preferred departmental policy for the use of such settlements.
For purposes of setting forth the nature of these legal limitations, it is important
to describe the type of agreements to which we believe the Meese Policy is
directed and to which the following analysis applies. We understand the Meese
Policy to be concerned with, and we accordingly address, those settlements that
are enforceable by Article III courts and that in some meaningful respect bind
the exercise of executive branch discretion. We therefore do not consider the limits
that federal law may place on the Attorney General’s authority to enter into agree­
ments that may be enforced in non-Article III tribunals; that are not intended to
be legally binding in any adjudicative forum; or that provide as the sole remedy
for governmental breach the re-institution of the litigation in its entirety. See
Memorandum for Anthony C. Liotta, Acting Assistant Attorney General, Land
and Natural Resources Division, from Larry L. Simms, Acting Assistant Attorney
General, Office of Legal Counsel, Re: Consent Judgment in Environmental
Defense Fund, et al. v. Costle at 2 & n.* (Mar. 30, 1981) (“ Costle Memo” );
Meese Policy at 4 (stating that “ revival of the suit” shall be “ the sole remedy”
for the executive branch’s failure to comply with the terms of a settlement agree­
ment that limits the exercise of executive branch discretion). Agreements of these
types either impose no legally meaningful constraint on executive branch discre­
tion, Costle Memo at 2, or raise separation of powers concerns that arc distinct
from the ones that are identified by the Meese policy. See, e.g., Constitutional
Limitations on Federal Government Participation in Binding Arbitration, 19 Op.
O.L.C. 208 (1995) (“ Binding Arbitration") (discussing constitutional concerns
raised by giving binding effect to the decisions of congressionally controlled
arbitration panels).
Moreover, although virtually every judicially enforceable executive branch
settlement limits the exercise of executive branch discretion to some degree, we
address here only those executive branch settlements that render ordinarily ‘‘revis-
able” executive branch discretion less “ revisable.” See Peter M. Shane, Federal
Policy Making by Consent Decree: An Analysis o f Agency and Judicial Discretion ,
1987 U. Chi. Legal F. 241, 243^46.4 We have limited our analysis in this way
because we understand the Meese Policy’s limitations to be directed only at settle­
ments of this type. An example of a settlement that would render ordinarily revis­
able executive branch discretion less revisable would be a binding promise by
an agency to investigate a particular issue as a possible subject for rule making
or enforcement. An agency’s decision whether to conduct such an investigation
is normally both discretionary and revisable; absent a statutory mandate, the
4 We borrow the word “ revisable” from Professor Shane, who uses the term to refer to those executive branch
determinations that are ordinarily within the discretion of the executive branch actor who makes them See id
131
Opinions o f the Office o f Legal Counsel in Volume 23
agency generally need not investigate, and the agency is generally free to change
course and halt the investigation if it later decides that continued investigation
is unwarranted. See Chevron U.S.A., Inc. v. Natural Resources Defense Council,
Inc., 467 U.S. 837 (1984) (discussing executive branch agency authority to revise
regulations); Heckler v. Chaney, 470 U.S. 821 (1985) (discussing executive
branch’s enforcement discretion).
A settlement that purported to restrict the agency’s future investigatory discre­
tion, by, for example, requiring the agency to pursue a particular investigation,
would, however, operate to transform the otherwise revisable exercise of executive
branch discretion over investigations into a legally enforceable obligation to inves­
tigate. See Shane, supra at 245. The agency would have agreed to an enforceable
settlement that would require it to undertake certain investigations that it would
otherwise possess the statutory authority to forego as a matter of discretion. This
memorandum focuses on settlements that have this type of consequence.
We note that, by way of contrast, many discretionary governmental decisions
are not normally subject to revision once they have been made. We do not address
settlements that contain promises to undertake such ordinarily non-revisable
discretionary action, i.e., settlements that have the consequence of binding the
government to adhere to the terms of a choice that, although itself discretionary,
is ordinarily not subject to revision once it has been made. For example, a decision
by the government to pay money to compensate a tort victim in a settlement does
not constrain the exercise of revisable executive discretion as we use that concept
here. Under ordinary principles of contract law, the government’s initial decision
whether it should pay money in return for the consideration that a plaintiff will
terminate a suit is a discretionary one. The government’s decision to make the
promise to pay, however, is normally binding on the United States once it has
been made and the consideration has been received in return. See, e.g., Lynch
v. United States, 292 U.S. 571 (1934) (government contract binding); Perry v.
United States, 294 U.S. 330 (1935) (same). A settlement to pay a tort victim
money in consideration of the termination of the suit does not, therefore, constrain
the executive branch’s discretion to make the initial discretionary judgment as
to whether the settlement should be effected. It constrains only the government’s
capacity to decline to provide a payment that it has, in its discretion, consented
to make in return for the consideration that it has received from the other party
to the settlement. As one commentator has noted, the “ fact that a promise to
pay damages arises in the specific contractual context of settling a lawsuit does
not affect the ordinary status of the contracting decision as one that is nonrevis-
able.” Shane, supra at 245.
In this respect, executive branch settlements that purport to bind the exercise
of revisable policymaking discretion are distinct from ordinary executive branch
tort settlements, just as government contracts purporting to constrain the exercise
of regulatory authority are distinct from ordinary government supply contracts.
132
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
See United States v. Winstar Corp., 518 U.S. 839, 913 (1996) (Breyer, J. concur­
ring) (distinguishing between types of government contracts); see Jeremy A.
Rabkin & Neal E. Devins, Averting Government by Consent Decree: Constitu­
tional Limits on the Enforcement o f Settlements with the Federal Government,
40 Stan. L. Rev. 203, 227 (1987) (discussing the analogy between government
settlements and government contracts); see also Michael W. McConnell, Why
Hold Elections? Using Consent Decrees to Insulate Policies from Political
Change, 1987 U. Chi. Legal F. 295, 322-25 (same). As a result, we do not believe
that ordinary tort settlements that take the form of a binding promise by the United
States to pay money to a plaintiff in order to terminate a suit implicate the kind
of separation of powers concerns that are identified by the Meese Policy.
We understand that settlements of the type identified in the Meese Policy typi­
cally arise when executive branch agencies are defendants. See Memorandum for
the Associate Attorney General, from Deval L. Patrick, Assistant Attorney Gen­
eral, Civil Rights Division, Re: Department of Justice Policy Regarding Consent
Decrees at 1 (Nov. 1 1994) ( “ Patrick Memo” ); see also Cooper Press Conference
at 11-12. In some cases, however, they may also arise in government initiated
actions. See United States v. Board of Educ., 744 F.2d 1300, 1301 (7th Cir. 1984)
(each party to the agreement assumed obligation to “ make every good faith
effort” to fund desegregation plan), cert, denied, 471 U.S. 1116 (1985); Patrick
Memo at 4.
Finally, we note that the Meese Policy draws a distinction between the authority
of the executive branch to enter into consent decrees, which are agreements that
are formally entered as judicial orders, and the authority of the executive branch
to enter into settlement agreements, which are merely contracts that are judicially
enforceable. Thus, while the Meese Policy generally limits the settlement authority
of the executive branch in the manner set forth above, it describes the limitations
that apply to consent decrees differently from those that apply to settlement agree­
ments. For example, the Meese Policy states that it is “ constitutionally impermis­
sible for the courts to enter consent decrees containing [certain discretion limiting
provisions] where the courts would not have had the power to order such relief
had the matter been litigated,” but that the Attorney General retains plenary
authority to enter into most settlement agreements “ on terms that a court could
not order if the suit were tried to conclusion.” Meese Policy at 2. It appears
that the distinction rests on the Meese Policy’s conclusion that consent decrees
are more constitutionally problematic than settlement agreements because they
constitute judicial orders, entered by Article III courts, rather than merely contracts
between the executive branch and another party, whether public or private, to
the litigation.
In distinguishing between settlement agreements and consent decrees, the policy
also states that Department attorneys should not become parties to consent decrees
that limit executive discretion in a manner that would “ unduly or improperly
133
Opinions o f the Office o f Legal Counsel in Volume 23
constraint] executive discretion” if a similar limitation were imposed by injunc­
tion. Specifically, it states that Department attorneys should not enter into consent
decrees that require a department or agency to revise, amend, or promulgate regu­
lations where such actions would otherwise have been discretionary; to commit
the department or agency to expend funds that Congress has not appropriated and
that have not been budgeted for the action in question, or to seek a particular
appropriation or budget authorization; or to divest the Secretary or agency
administrator, or his successors, of discretion committed to him by Congress or
the Constitution where such discretionary power was granted to respond to
changing circumstances, to make policy or managerial choices, or to protect the
rights of third parties. Id. at 3-4.
By contrast, the policy sets forth different limitations concerning settlement
agreements. The policy states that Department attorneys should not enter into a
settlement agreement that “ interferes with the Secretary or agency administrator’s
authority to revise, amend, or promulgate regulations through the procedures set
forth in the Administrative Procedure Act;” that commits the Department or
agency to expend funds that Congress has not appropriated and that have not
been budgeted for the action in question; that agrees to have the Secretary or
agency administrator exercise his discretion in a particular way, where such discre­
tion was committed to him by Congress or the Constitution to respond to changing
circumstances, make policy or managerial choices, or protect the rights of third
parties, unless the agreement makes revival of the suit the sole remedy for non-
compliance. See id.
It is not entirely clear what substantive consequences are intended to follow
from the difference in terminology that the Meese Policy uses in setting forth
the rules that should apply to consent decrees as compared to settlement agree­
ments. As we explain below, we do not believe that the distinction the Meese
Policy draws between consent decrees and settlement agreements is of independent
legal significance for purposes of determining the legal limits on discretion-lim-
iting settlements except, perhaps, in rare cases. Nevertheless, where relevant to
our analysis, we discuss the distinction that the Meese Policy draws between these
two means of compromising litigation and how the distinction relates to federal
constitutional and statutory restrictions on the authority of the executive branch
to settle cases on terms that would limit the future exercise of executive branch
discretion.
With these qualifications and clarifications in place, we now turn to a consider­
ation of the general legal principles that define the limits of the Attorney General’s
power to effect the types of settlements that are at issue in the Meese Policy.
After setting forth these general legal principles, we consider in Part IV how these
general principles apply with respect to the types of settlements that are the subject
of the Meese Policy.
134
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
III. General Legal Principles
A. The Source of the Attorney General’s Settlement Authority
We begin by considering the source of the Attorney General’s settlement power.
The Office of the Attorney General is established by statute. Within broad con­
stitutional bounds that are not directly relevant here, therefore, the Attorney Gen­
eral’s power to settle litigation is defined, expressly or implicitly, by statute. See
Tenaska Washington Partners v. United States, 34 Fed. Cl. 434, 440 (1995).5 The
Attorney General’s settlement power is not expressly identified by statute, but
it has long been understood to exist as an incident to the Attorney General’s statu­
tory authority to supervise litigation for the United States. See Swift & Co. v.
United States, 276 U.S. 311 (1928); 28 U.S.C. §§516, 519 (1994); Power o f the
Attorney General in Matters of Compromise, 38 Op. Att’y Gen. 124, 126 (1934)
(the authority “ is in part inherent, . . . and in part derived from various statutes
and decisions” ); Executive Bus. Media, Inc. v. United States D ep’t of Defense,
3 F.3d 759, 761-62 (4th Cir. 1993); United States v. Hercules, Inc., 961 F.2d
796, 798 (8th Cir. 1992). “ Included within this broad grant of plenary power
over government litigation is the power to compromise and settle litigation over
which the Attorney General exercises supervisory authority.” The Attorney Gen­
eral’s Role as Chief Litigator for the United States, 6 Op. O.L.C. 47, 59 (1982).
In addition, Executive Order No. 6166 transferred to the Department of Justice
the powers of other agencies “ to prosecute, or to defend, or to compromise, or
to appeal, or to abandon prosecution or defense” of actions involving the United
States. See Exec. Order No. 6166 (1933), reprinted in 5 U.S.C. §901 note (1994).
The Attorney General’s settlement power ordinarily attaches upon her receipt
of a case and permits her to exercise broad discretion in determining when, and
on what terms, settlement would best serve the interests of the United States.
See 6 Op. O.L.C. at 59; Hughes Aircraft Co. v. United States, 534 F.2d 889,
901 (Ct. Cl. 1976).6 The settlement power is sweeping, but the Attorney General
must still exercise her discretion in conformity with her obligation to “ enforce
the Acts of Congress.” The Attorney General’s Duty to Defend and Enforce Con­
stitutionally Objectionable Legislation, 4A Op. O.L.C. 55, 55 (1980); Kendall v.
United States ex rel. Stokes, 37 U.S. (12 Pet.) 524, 609-13 (1838); cf Angelus
Milling Co. v. Comm’r, 325 U.S. 293, 296 (1945) ( “ Insofar as Congress has made
explicit statutory requirements, they must be observed and are beyond the dis­
5 We do not consider in this memorandum the outer limits o f Congress’s constitutional authority to control the
settlement discretion of the executive branch
6 See, e.g , 28 U S.C. §2414 (1994) ( “ Except as otherwise provided by law, compromise settlements o f claims
referred to the Attorney General for defense of imminent litigation or suits against the United States, or against
its agencies o r officials upon obligations or liabilities o f the United States, made by the Attorney General or any
person authonzed by him, shall be settled and paid in a manner similar to judgments in like causes . . .” ), Id.
§2677 ( “ The Attorney General or his designee may arbitrate, compromise, or settle any claim cognizable under
[28 U S C.] section 1346(b) after the commencement o f an action thereon ’*).
135
Opinions o f the Office o f Legal Counsel in Volume 23
pensing power of [Executive] officials.” ). Thus, the Attorney General must, as
a general matter, exercise her broad settlement discretion in a manner that con­
forms to the specific statutory limits that Congress has imposed upon its exercise.
See Waiver o f Statutes o f Limitations in Connection with Claims Against the
Department o f Agriculture, 22 Op. O.L.C. 127, 137-38 (1998).7
B. Congressional Limitations on the Settlement Power
In addition to statutory limitations directly targeting the Attorney General’s
settlement power in particular, Congress may place limits on the scope of the
Attorney General’s settlement power through the general laws that govern the con­
duct of the agencies on behalf of which the Attorney General purports to settle.
See Shoshone-Bannock Tribes v. Reno, 56 F.3d 1476, 1480 (D.C. Cir. 1995);
Executive Bus. Media, 3 F.3d at 762 (“ [the settlement power] stops at the walls
of illegality” ); Settlement Authority of the United States in Oil Shale Cases, 4B
Op. O.L.C. 756, 758 (1980); Costle Memo at 1-2. For example, the statutory
requirement that the Department o f Defense engage in competitive bidding has
been held to preclude the Attorney General from settling a breach of contract
claim by promising to award a Department' contract outside the competitive bid­
ding process, wholly apart from any concerns about the limitations such a settle­
ment would impose upon the future exercise of executive branch discretion. See
Executive Bus. Media, 3 F.3d at 762. Similarly, the United States Court of Appeals
for the District of Columbia Circuit has explained that a federal statutory limitation
on the applicability of the National Environmental Policy Act ( “ NEPA” ) to a
federal construction project would constrain the authority of the Attorney General
to stipulate that the Secretary of the Interior would stay that project pending reso­
lution of an environmental lawsuit. See National Audubon Soc’y, Inc. v. Watt 678
F.2d 299, 308 n.18 (D.C. Cir. 1982) (explaining that “ the general authority of
the Justice Department over the conduct of . . . litigation . . . does not com­
pensate for the Secretary’s lack of authority under NEPA” ). See also Alliance
to End Repression v. City of Chicago, 742 F.2d 1007, 1014 (7th Cir. 1984) (sug­
gesting that consent decree limiting the investigatory authority of the Federal
Bureau of Investigation may conflict with federal statutes that criminalize certain
terrorist conduct).
When statutory limits on the scope of the Attorney General’s settlement discre­
tion are unclear, the Attorney General is presumed to have been authorized by
Congress to settle on the terms that she determines would best serve the interests
of the United States. See Hercules, 961 F.2d at 799 (holding that, since sections
122(a)-(f) inclusive of CERCLA do not apply to a cost recovery settlement,
“ those provisions cannot be said to contain any clear and unambiguous limitation
7 In rare cases, however, congressional directives regarding the exercise o f executive power may be justifiably
disobeyed on constitutional grounds. See 4A O p . O.L.C. at 55.
136
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
on the Attorney General’s plenary ability to enter into settlements of cost recovery
litigation” ); 6 Op. O.L.C. at 59. The presumption in favor of a broad construction
of the settlement power reflects the strong public interest in the swift resolution
of burdensome litigation involving the United States, see, e.g., Utility Reform
Project v. Bonneville Power Admin., 869 F.2d 437, 442 (9th Cir. 1989); Citizens
fo r a Better Env’t v. Gorsuch, 718 F.2d 1117, 1126 (D.C. Cir. 1983), cert, denied,
467 U.S. 1219 (1984); 6 Op. O.L.C. at 59, as well as a recognition of the Attorney
General’s broad authority to control the conduct of litigation undertaken on behalf
of the United States. Although Congress may restrict that authority through the
imposition of statutory limitations on the conduct of the agency on behalf of which
the settlement would be entered, it is important to emphasize that the agencies
represented by the Attorney General are generally entitled to deference in con­
struing the scope of ambiguous statutory restrictions on their conduct. See Citizens
fo r a Better Env’t, 718 F.2d at 1126; SEC v. Randolph, 736 F.2d 525 (9th Cir.
1984) (deferring to Securities and Exchange Commission’s construction of statutes
governing decree); Chevron U.S.A., Inc. v. Natural Resources Defense Council,
Inc., 467 U.S. 837 (1984); 6 Op. O.L.C. at 55 (explaining that “ in exercising
supervisory authority over the conduct of agency litigation, the Attorney General
will generally defer to the policy judgments of the client agency. This deference
reflects a recognition of the agency’s considerable expertise in the substantive
area with which it is primarily concerned.” ).8
In general, then, limits on the Attorney General’s presumptively broad settle­
ment power must take the form of clear statutory directives in order to be effec­
tive. See, e.g, Utility Reform Project, 869 F.2d at 443 (affirming settlement in
which the administration agreed to halt construction of a nuclear power plant
pursuant to statute conferring settlement authority upon the administration); Her­
cules, 961 F.2d at 798 (limits must be “ clear and unambiguous” ). Those limits
may take the form, however, of not only targeted restrictions on the exercise of
the settlement power itself but also restrictions on the conduct of the agency that
incidentally serve to circumscribe the permissible terms of a settlement.
We emphasize, in this regard, that the statutory limitations on the Attorney Gen­
eral’s settlement authority need not take the form of direct prohibitions against
the exercise of that authority. The Attorney General generally possesses the
congressionally conferred power to settle on terms that would serve the best
interests of the United States, but the considerations and terms that inform and
structure a settlement must be traceable, nonetheless, to a discernible source of
statutory authority. We have explained that “ [i]n deciding to settle or abandon
8 At the same time, in many circumstances agencies are not free in the course of litigation to alter, amend, or
adopt a regulatory interpretation o f a statutory provision that governs their conduct Agencies may be required by
the Administrative Procedure Act, for example, to adopt such an interpretation only through notice and comment
rulemaking Thus, the Attorney General may be unable to rely on an agency’s construction of an ambiguous statutory
provision in circumstances in which, outside the settlement context, the agency would not be entitled either to adopt
such an interpretation or to receive judicial deference for it.
137
Opinions o f the Office o f Legal Counsel in Volume 23
a claim, or not to prosecute at all, the Attorney General is not restricted to consid­
erations only of litigative probabilities, but rather may make a decision, in his
discretion, on the basis of policies espoused by the Executive.” 6 Op. O.L.C.
at 60. At the same time, however, we qualified this statement by explaining that
the President’s constitutional obligation to “ take Care that the Laws be faithfully
executed” necessarily serves to limit the exercise of the Attorney General’s settle­
ment authority so that it does not become a dispensing power. Id.
As a general matter, certain considerations, such as litigation risk, are inherent
in a settlement power itself, and thus the authority to settle on the basis of such
considerations may be assumed to have been conferred by the statutes that serve
as the basis for the existence of the Attorney General’s general settlement power,
namely the statutes that entrust the Attorney General with the supervisory
authority over litigation involving the United States. See Compromise o f Claims
Under Sections 3469 and 3229 o f the Revised Statutes, 38 Op. Att’y Gen. 94
(1933). Other types of considerations that concern more particular policy aims,
however, generally must be rooted in the purposes of the statutes that govern
the agency that has been vested by Congress with the policymaking discretion
and on whose behalf the settlement would be effected. It is the governing statutes
of the agency involved in the litigation, therefore, that in many instances must
provide the authority for a settlement. As we have previously explained in a
related context,
[sjtrictly speaking, “policy” judgments are confined to those sub­
stantive areas in which the agency has developed a special expertise
and in which the agency is vested by law with the flexibility and
discretion to make policy judgments. However, it is increasingly
the case that policy concerns are implicated in decisions dealing
with litigation strategy, and in such cases, the Attorney General
will accommodate the agency’s policy judgments to the greatest
extent possible without compromising the law, or broader national
policy considerations.
See 6 Op. O.L.C. at 55; Lars Noah, Administrative Arm-Twisting in the Shadow
o f Congressional Delegations o f Authority, 1997 Wis. L. Rev. 873, 926 ( “ [T]here
is no inherent executive authority to settle cases on terms that have no connection
with the agency’s statutory warrant.” ) (quoting Marshall J. Breger, Regulatory
Flexibility and the Administrative State, 32 Tulsa L. J. 325, 338 (1996)).
In the end, the precise line that distinguishes a limitation on an administrative
agency’s authority from a limitation that also applies against the Attorney Gen­
eral’s power to settle litigation on an agency’s behalf is necessarily imprecise.
In an earlier opinion, we explained that there is some “ tension” between the
Attorney General’s broad settlement power and the Attorney General’s obligation
138
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
to enforce valid statutes. 4B Op. O.L.C. at 758. Under the broad settlement
authority conferred upon the Attorney General, “ it is reasonably clear that the
Attorney General — in the exercise of his settlement responsibilities — is not
bound by each and every statutory limitation and procedural requirement that Con­
gress may have specifically imposed upon some other agency head in the adminis­
tration of [the] agency’s programs.” Id. We further explained that “ congressional
requirements imposed on officials other than the Attorney General should not be
thought to be directly [attributable] to him for the performance of his litigation
function.” Id. We went on to explain, however, that “ Congress’s will is surely
not irrelevant to the Attorney General’s discretion,” id., and that statutory limita­
tions on the authority of an agency head may make it “ reasonable to question
whether the Attorney General’s general litigation supervisory powers would give
him a greater discretion.” Id. at 758 n.2. We concluded, therefore, that “ if there
is a greater ambit of discretion, it must be located in Congress’ actions in creating
a centralized litigating department and clothing it with overriding authority to
settle particular cases.” Id.As the settlement there in question had already been resolved, we declined to
pursue the question any further at that time, other than to conclude that a settle­
ment that would result in action “ plainly at variance with Congress’ intent” would
be foreclosed and thus that a determination of the scope of the settlement power
in particular cases must ultimately be made with attention to the specific statutes
governing the activities that form the subject matter of the litigation. Id. at 758.
That basic conclusion remains sound. The ultimate task is to arrive at a faithful
determination of Congress’s intent, taking into account both the purposes that
underlie the Attorney General’s statutorily conferred settlement power and the
terms and purposes of the statutes that are relevant to the particular matter in
litigation, including the statutes that limit the discretion of the agency on behalf
of which the Attorney General would be entering into a settlement.
In addition to the limitations that Congress may place on the terms of settle­
ments, Congress may also place limits on the kinds of claims that the Attorney
General, as opposed to some other official, may settle, but these limits as well
must be “ clear and unambiguous.” See Hercules, 961 F.2d at 798; 4B Op. O.L.C.
at 756. These limits must be directed at the Attorney General’s own settlement
power, rather than the settlement power of other agency heads. Because Congress
has entrusted the Attorney General alone with general supervisory power over
litigation conducted on behalf of the United States, her settlement authority with
respect to certain claims is presumed to remain even when Congress has expressly
curtailed the settlement authority with respect to those same claims of some other
executive branch official. Id. Thus, for example, a statute that prohibited the Sec­
retary of the Treasury from settling certain tax claims was not thought to preclude
139
Opinions o f the Office o f Legal Counsel in Volume 23
the Attorney General from settling those same claims. See 38 Op. Att’y Gen.
at 94.9
C. Constitutional Limitations on the Settlement Power
Even when Congress has authorized the Attorney General to settle litigation
on terms that would limit the future exercise of executive branch discretion, the
Constitution may prevent her from doing so. Most obviously, basic constitutional
restrictions on governmental action, whether or not such action is taken in the
context of a litigation settlement, constrain the Attorney General’s exercise of her
settlement discretion. Thus, for example, she may not enter into a decree that
would require unconstitutional governmental action in violation of the rights of
private parties or the structural prerogatives of the states. Cf Local 93, Int’l A ss’n
o f Firefighters v. City o f Cleveland, 478 U.S. 501, 526 (1986) (explaining that
consent decree mandating affirmative action plan would have to conform to the
Equal Protection Clause).
In addition, the Constitution places particular limitations on the authority of
the Attorney General to enter into judicially enforceable settlements that would
limit the exercise of executive branch discretion. These limitations inhere in (1)
the constitutional limitations that are rooted in both the general executive power
that Article II of the Constitution vests in the President and that may constrain,
in extreme cases, the executive branch’s authority to adopt enforceable limitations
on the future exercise of congressionally conferred executive discretion, as well
as the specific discretionary powers that Article II confers directly upon the Presi­
dent, such as the power to recommend legislation to Congress and (2) the restric­
tions that Article III imposes on the power of federal courts to enforce certain
types of executive branch settlements that are otherwise constitutionally permis­
sible. We consider below each o f these types of constitutional limitations on the
executive branch’s power to enter into judicially enforceable settlements.
1. Article II Limitations on the Attorney General’s Settlement Authority. It is
important to distinguish between two types of executive branch settlements, each
of which derives from one of the two sources for executive branch power: the
power vested in the executive branch by Congress pursuant to statute and the
9 In concluding that the Attorney General’s authority to settle on terms that would limit the future exercise of
congressionally conferred executive discretion must be rooted in a statutory grant of power, we do not address
the distinct question o f the degree to which th e constitutional separation o f powers would permit the Congress to
circum scribe the Attorney G eneral’s authority to decline to pursue an enforcement action in the first instance (or
to dismiss such an action after it has been commenced). See Memorandum for Abbot B. Lipsky, Jr., Deputy Assistant
Attorney General, Antitrust Division, from L a n y L Simms, Deputy Assistant Attorney General, Office of Legal
Counsel, Re: Constitutionality o f Applying the Tunney Act or Similar Legislation to Dismissals by the United Slates
o f Civil Antitrust Actions (June 7, 1983) (discussing potential separation o f powers issues raised by legislation that
w ould circum scribe the Attorney General’s authonty to dismiss antitrust suits) A limitation of this type would con­
stitute a direct infringement o f the discretion that the executive would choose to exercise if permitted to do so,
while settlements o f the type at issue here concern the judicial enforcement of limitations that the executive has
voluntarily agreed to assume
140
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
power vested in the executive branch by the Constitution directly. See Youngstown
Sheet and Tube Co. v. Sawyer, 343 U.S. 579, 635-37 (1952) (Jackson, J., concur­
ring). First, there are settlements that purport to limit the future exercise of the
discretion that Congress has conferred upon the executive branch pursuant to
statute. Settlements of this type are generally permissible but may in extraordinary
cases implicate structural limitations regarding the authority of the executive
branch to divest itself of the administration of federal law. Second, there are settle­
ments that purport to limit the future exercise of the discretion that the Constitu­
tion itself, by virtue of Article II, commits to the executive branch without regard
to whether there has been a congressional delegation of authority. See Shane,
supra at 255. Settlements of this type are generally impermissible.
(a) Settlements That Limit Congressionally Conferred Executive Branch Discre­
tion. In general, Congress may define the scope of the discretion that it authorizes
the executive branch to exercise without infringing upon the constitutional separa­
tion of powers between the legislative and executive branches. See Heckler v.
Chaney, 470 U.S. 821, 833 (1985); see also Lincoln v. Vigil, 508 U.S. 182, 193
(1993) (“ an agency is not free simply to disregard statutory responsibilities: Con­
gress may always circumscribe agency discretion to allocate resources by putting
restrictions in . . . operative statutes” ). Because Congress may, within broad con­
stitutional boundaries, define the scope of the discretionary authority that it confers
upon the executive branch, see Mistretta v. United States, 488 U.S. 361, 372-
73 (1989) (holding that it is “ constitutionally sufficient if Congress clearly delin­
eates the general policy, the public agency which is to apply it. and the boundaries
of th[e] delegated authority” ) (citation omitted), it possesses the power to confer
upon the executive branch the authority to settle litigation on terms that place
limits upon the exercise of that discretion. As one commentator has explained,
constraints on executive authority to limit discretion that has been
vested in the executive by statute are themselves essentially statu­
tory and must be determined with reference to legislative intent.
The discretion subject to limitation is discretion delegated by Con­
gress, at its discretion. Whether the President may compromise
discretion Congress has so vested is likewise a matter within
Congress’s power to decide.
Shane, supra at 255.
The constitutional requirement that the President “ take Care that the Laws be
faithfully executed,” U.S. Const, art. II, §3, is consistent with the conclusion
that Congress may authorize the Attorney General to settle litigation on terms
that place limits on the future exercise of congressionally conferred executive
branch discretion. The Take Care Clause “ simply requires the President to ‘take
Care’ that whatever valid legal requirements might exist are followed.” Binding
141
Opinions o f the Office o f Legal Counsel in Volume 23
Arbitration, 19 Op. O.L.C. at 224. It-does not, in and of itself, affect the power
of the Attorney General to limit the exercise of discretion conferred by Congress,
when Congress grants her the broad power to do so through settlement, and no
independent constitutional provision stands as an obstacle. Id. (reaching the same
conclusion with respect to the government’s power to submit to binding arbitration
in the absent of either a statutory command to do so or a statutory prohibition
against doing so). Therefore, to the extent that the Constitution imposes restric­
tions on executive branch settlements that limit the exercise of congressionally
delegated discretion, the Take Care Clause is not the basis for those limitations.
Those limitations must be found elsewhere.10
Notwithstanding the broad power that Congress possesses to authorize the
executive branch to limit its statutorily conferred discretion through an enforceable
settlement, Article II, which vests the executive power in the President, and
considerations of the constitutional structure may in extraordinary cases give rise
to concerns about congressionally authorized executive branch settlements that
restrict the exercise of such discretion. As a practical matter, it is unlikely that
it will be necessary to consider these possible constitutional limitations, as Con­
gress will rarely, if ever, authorize the executive branch to settle on terms that
would divest itself of the kind of administrative authority over federal law that
it might be constitutionally required to maintain. Certainly a general conferral of
settlement authority would not suffice to authorize an irrevocable divestment of
the kind of significant policymaking authority that, as a conceptual matter, would
raise constitutional concerns.
In circumstances where a settlement that would effect such a divestment is con­
templated, some guidance as to the proper constitutional analysis may be drawn
from the precedents that concern the constitutionality of statutory provisions that
interfere with the general separation of powers principle, which precludes one
branch from unduly interfering with the ability of another branch to perform its
constitutionally assigned functions. Nixon v. Administrator o f Gen. Servs., 433
U.S. 425, 443 (1977); The Constitutional Separation o f Powers, 20 Op. O.L.C.
at 133-35.11 This general principle, in certain circumstances, may constrain the
authority of Congress to delegate the administration of federal law to non-execu­
10Because Article III judges are not congressional agents, Congress does not confer power on itself or its agents
when it authorizes the A ttorney General lo settle litigation in federal court on certain terms C f Binding Arbitration,
19 Op. O L.C. at 225 (discussing constitutional limits on Congress’s power to exercise continuing control over an
arbitrator). It merely authorizes the executive branch to execute the laws — namely, the laws conferring settlement
discretion— free from congressional control an d in accord with judicially enforced limitations. Accordingly, statutes
that confer settlement pow er upon the Attorney General do not implicate the anti-aggrandizement principle, which
“ forbids Congress, directly or through an agent subject to removal by Congress, from intervening in the decision
making necessary to execute the law ” The Constitutional Separation o f Powers Between the President and Congress,
20 Op. O L.C 124, 131 (1996) (footnote om itted) (“ The Constitutional Separation o f Powers” ) Such statutes merely
authorize the executive branch to exercise discretion in a manner that may invite judicial supervision. As we discuss
below, however, the enforcement o f such settlements may, in certain instances, constitute impermissible exercises
o f the judicial pow er conferred on the federal courts by Article III.
11 W e do not address here the extent to w hich the general separation of powers principle, as applied as a constraint
on limitations on executive power, is rooted in part in the Take Care Clause.
142
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
tive branch actors because such delegations, like restrictions on the removal
power, may undermine the executive branch’s ability to perform its constitu­
tionally assigned functions with respect to the administration of federal law. See
id. at 176-77. The general separation of powers principle does not bar delegations
of this type as a general matter, but it may do so in circumstances in which “ a
congressional delegation of authority to non-federal officials or to private parties
might have a significant impact on the executive branch’s ability to fulfill its con­
stitutional functions.” Id. at 177 (discussing delegations to actors outside the fed­
eral government that have been made pursuant to congressional mandates); see
also Carter v. Carter Coal Co., 298 U.S. 238, 311 (1936) (striking down congres­
sional delegation to industry group); A.L.A. Schechter Poultry Corp. v. United
States, 295 U.S. 495, 537 (1935) (same); Rabkin & Devins, supra at 225
(explaining that “ [w]here Congress has . . . vested responsibility in an executive
program, directly parallel constitutional objections would surely apply to any effort
to subdelegate this . . . responsibility to private parties.” ).12
In an extraordinary case, a legally enforceable settlement could be said to have
a similarly significant impact on the executive branch’s ability to fulfill its con­
stitutionally assigned functions. Some settlements that irrevocably conferred
substantial administrative discretion to determine the substance of federal regula­
tions affecting the conduct of third parties could, for example, raise constitutional
concerns as the other party to the settlement would not be under the executive
branch’s control. Thus, the vesting of the executive power in the President, as
well as more general principles of constitutional structure, raise concerns about
the constitutionality of binding settlements that would have the consequence of
delegating to non-executive branch actors substantial administrative discretion of
a type that Congress could not itself delegate to actors wholly outside the execu­
tive branch’s control. In this respect, the general settlement power of the Attorney
General should not be construed to authorize the kind of extraordinary settlements
that would implicate these constitutional concerns.
Even apart from constitutional concerns that relate to the executive’s administra­
tion of the laws that Congress has enacted, settlements of this type may also raise
independent concerns under the Due Process Clause. For example, such concerns
may be presented to the extent that such settlements would preclude third parties
from receiving notice of, or commenting upon, substantive regulations that the
United States would agree in the settlement to promulgate and that would have
an “ immediate and direct affect on [the third party’s] activities” prior to their
adoption. See Environmental Defense Fund, Inc. v. Costle, 636 F.2d 1229, 1257
12 This office is no longer o f the view that the Appointments Clause prohibits the delegation of rulemaking authority
to pnvate groups as a general matter, see The Constitutional Separation o f Powers, 20 Op. O.L.C. at 142 & n 52,
although prior opinions o f this office had reached that conclusion. See, e .g , Constitutional Limits on "Contracting
O u t" Department o f Justice Functions Under OMB Circular A -7 6 , 14 Op O L C 94 (1990). W e now believe
that such delegations are more properly considered as implicating the general separation of powers principle See
The Constitutional Separation o f Powers, 20 Op O.L.C. at 176-77
143
Opinions o f the Office o f Legal Counsel in Volume 23
(D.C. Cir. 1980). These concerns are heightened when the settlement, by granting
a private party an enforceable right to direct the regulatory discretion of the execu­
tive branch, effectively authorizes one industry to regulate its competitors. See,
e.g., Carter Coal , 298 U.S. at 311. The serious constitutional concerns such
extraordinary settlements raise provide an additional basis for construing the scope
of the present settlement power to preclude such settlements. See The Constitu­
tional Separation o f Powers, 20 Op. O.L.C. at 178 (discussing canon of narrow
construction to avoid separation of powers issues); cf. United States v. Winstar
Corp., 518 U.S. 839, 913 (1996) (Breyer, J., concurring) (explaining that “ [t]he
simple fact that it is the Government may well change the underlying cir­
cumstances, leading to a different inference as to the parties’ likely intent — say,
making it far less likely that they intend to make a promise that will oblige the
government to hold private parties harmless in the event of a change in the law)
(emphasis added).
Notwithstanding the limitations that Article II and the Due Process Clause may
impose upon the executive settlement power in certain extreme cases, Congress’s
general power to authorize the executive branch to settle litigation on terms that
would limit the exercise of congressionally conferred executive branch discretion
is broad. Indeed, it extends even, as a constitutional matter, to permit Congress
to authorize a present administration’s executive branch to enter into a settlement
that would bind a subsequent administration’s exercise of that same statutorily
conferred executive discretion. See Robert V. Percival, The Bounds of Consent:
Consent Decrees, Settlements and Federal Environmental Policy Making, 1987
U. Chi. Legal F. 327, 344.13 Just as Congress may authorize an agency to enter
into a settlement that would govern the mode of enforcement of a particular statute
for six months, it may authorize an agency to agree to a settlement that would
govern the mode of enforcement for six years. In either case, Congress would
have simply authorized the agency to limit the future exercise of congressionally
conferred executive discretion. And because the limitation would apply only to
discretion that Congress had itself conferred, the limitation would in no way
infringe upon the executive’s constitutional power. “ If the laws Congress passes
enable one president to curtail the enforcement discretion of later administrations,
and a president invokes such authority, then later administrations, implementing
their curtailed discretion, are faithfully executing the laws, as Congress has
enacted them; no constitutional power has been lost.” See Shane, supra at 291
n.181.
13Some commentators have suggested that a contrary rule follows from IN S v Chadha, 462 U S . 919, 947 (1983),
in which the Court permitted President Reagan to challenge the constitutionality of a legislative veto provision that
President Kennedy had signed into law. See, e g ., Rabkin & Devins, supra at 219-20 (citing other similar cases
as well) Chadha supports only the more lim ited proposition that one administration may not sign unconstitutional
legislation and thereby preclude subsequent administrations from challenging that law’s constitutionality. Thus, while
Chadha helps to explain why settlements th at unconstitutionally constrain a present administration may not bind
a subsequent one, it does not address w hether settlements that permissibly constrain a present administration may
constitutionally bind a subsequent one.
144
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
That an agreement of this type would extend beyond the duration of the present
administration would not appear to be of independent constitutional significance.
Numerous exercises of executive discretion that are made pursuant to congres­
sional authority limit the scope of congressionally conferred discretion and bind
subsequent administrations. See Winstar, 518 U.S. at 872-73 (holding United
States liable for prior promises to bear costs of regulatory change made by execu­
tive branch agency officials) (opinion of Souter, J.); id. at 876 (explaining that
“ it is clear that the National Government has some capacity to make agreements
binding future Congresses by creating vested rights” ); Fletcher v. Peck, 10 U.S.
(6 Cranch) 87, 135 (1810); Percival, supra at 344 (“ By necessity, executive agen­
cies undertake many actions that have a profound impact on the policy choices
available to future administrations.” ). The critical point is that such agreements
serve to circumscribe and define the enforcement discretion that Congress itself
has delegated, not to diminish the executive power that the Constitution has com­
mitted to the executive branch.
It should be acknowledged, however, that the Supreme Court’s general state­
ments regarding the authority of Congress to bind the future exercise of
Congress’s legislative discretion have appeared in cases that have involved claims
for damages that have resulted from the enactment of subsequent legislation rather
than in cases that have involved claims for injunctions against the enforcement
of such subsequent legislation. The Court has stated that a present Congress may
authorize action that will incur financial obligations that will be borne far into
the future, thereby limiting the future lawmaking discretion of Congress in some
respects. It has also made reference in several cases, however, to what it has
termed the “ reserved powers” doctrine, “ which [has] held that certain substantive
powers of sovereignty could not be contracted away.” Winstar, 518 U.S. at 874(opinion of Souter, J.). As Justice Souter recently explained, this general doctrine
“ has always lived in some tension with the constitutionally created potential for
a legislature, under certain circumstances, to place effective limits on its succes­
sors or to authorize executive action resulting in such a limitation.” Id. at 873.
The reserved powers doctrine may be traced to early cases in which the Supreme
Court confronted claims that the state legislature had, through subsequent legisla­
tion, purported to abrogate apparent state promises to exempt certain private par­
ties from the future application of state regulatory power. In the course of rejecting
the Contracts Clause claims of these private parties, the Supreme Court concluded
that state legislatures lacked the power to contract away certain of their state
powers. See, e.g., Stone v. Mississippi, 101 U.S. 814 (1879) (state may not contract
away its police power). The reserved powers doctrine has not been applied directly
against the federal government to invalidate federal legislation, but, as we have
mentioned, Justice Souter’s opinion in Winstar recently invoked the doctrine in
construing a promise that had been made by a federal regulatory agency so as
not to limit the future power of Congress to subject private parties to newly
145
Opinions o f the Office o f Legal Counsel in Volume 23
imposed regulatory requirements. See Winstar, 518 U.S. at 873-74 (opinion of
Souter, J.).
The reserved powers doctrine would not appear to preclude the executive branch
from making a judicially enforceable promise that would limit the future exercise
of congressionally conferred executive discretion. Such a promise would not itself
bind the legislature; it would merely set forth a limitation on the discretion that
the executive branch could exercise pursuant to its then applicable statutory
authority. Thus, the consent by an agency to an enforceable limitation on the
future regulatory authority of that agency would not, absent independent constitu­
tional limitations that may be imposed by the Due Process or Takings Clauses,
limit the ability of Congress to enforce regulatory measures pursuant to a subse­
quent legislative measure. Indeed, there would be compelling reason to doubt,
in the absence of a clear indication to the contrary, that an executive branch
agency would be authorized to promise that a particular party would be free from
a future, congressionally mandated regulatory change.
Finally, we note that, although there is no general bar to executive branch settle­
ments that limit the future exercise of congressionally conferred executive branch
discretion, courts often construe the actual terms of executive branch settlements
narrowly on the assumption that they are not intended to bind subsequent adminis­
trations and out of respect for executive branch prerogatives. See, e.g., Evans v.
City o f Chicago, 10 F.3d 474, 479 (7th Cir. 1993) (explaining importance of nar­
row constructions of decrees that bind the exercise of governmental discretion),
cert, denied, 511 U.S. 1082 (1994); Alliance to End Repression v. City o f Chicago,
742 F.2d at 1013 (explaining that “ a court will hesitate to assume that by signing
a consent decree the government knowingly bartered away important public
interests merely to avoid the expense of a trial” ). Indeed, the Supreme Court
suggested in Rufo v. Inmates o f Suffolk County Jail that the fact that a new
administration had taken office was generally relevant to a determination whether
a consent decree limiting governmental discretion may be modified. See 502 U.S.
367, 383 (1992).
In this respect, the interpretive practice comports with the rules that apply to
government contracts generally. The practice is rooted in an assumption about
the government’s likely intentions in settling litigation, rather than in a conclusion
about the scope of the executive branch’s constitutional authority to settle litiga­
tion in a manner that limits the future exercise of its statutorily vested discretion.
Cf. Winstar, 518 U.S. at 913 (Breyer, J., concurring) (explaining that “ [t]he simple
fact that it is the government [that is a party to the agreement] may well change
the underlying circumstances, leading to a different inference as to the parties’
likely intent — say, making it far less likely that they intend to make a promise
that will oblige the government to hold private parties harmless in the event of
a change in the law” ). This interpretive practice, however, indicates that settle­
ments that are intended to contain commitments of substantial duration should
146
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
make that intention manifest, assuming, of course, that such unusual commitments
are authorized.
(b) Settlements That Limit Constitutionally Conferred Executive Branch Discre­
tion. Settlements by the Attorney General that purport to resolve litigation on
terms that would limit the exercise of discretion that the Constitution itself confers
upon the executive branch raise different constitutional questions from those pre­
sented by settlements that purport to limit the exercise of congressionally con­
ferred discretion. In addition to vesting the general executive power in the Presi­
dent, which, as we have seen, may result in limitations on the executive branch’s
power to settle litigation on terms that would result in open-ended delegations
of administrative authority over federal law to non-executive branch actors, Article
II also vests certain more specified powers directly in the President, see Youngs­
town Sheet & Tube Co. v. Sawyer, 343 U.S. 579 (1952), and commits their exer­
cise to the President’s unfettered discretion. See Public Citizen v. United States
D ep’t o f Justice, 491 U.S. 440, 486 (1989) (Kennedy, J., concurring) (distin­
guishing between these two types of executive power). An analysis of the
expressly named discretionary functions that, in addition to the vesting of the
executive power itself, the Constitution commits to the President is beyond the
scope of this memorandum. As we discuss below, however, the President’s power
to make recommendations to Congress is among them. See Memorandum
Regarding Delegation of Presidential Functions at 32 (Sept. 1, 1955) (“ Delega­
tion Memo” ); see also Binding Arbitration, 19 Op. O.L.C. at 226 (discussing
pardon, Commander in Chief, and foreign affairs powers).Congress need not act
in order for the President to exercise such constitutionally vested discretionary
powers, and it is powerless to restrict the President’s discretionary exercise of
them. See, e.g., Schick v. Reed, 419 U.S. 256, 266 (1974) (explaining that the
pardon power “ flows from the constitution alone . . . and . . . cannot be modi­
fied, abridged, or diminished by the Congress” ). In vesting these discretionary
powers in the President, the Constitution necessarily precludes the Attorney Gen­
eral from settling litigation on terms that would require that their exercise comply
with the terms of a binding settlement. See Memorandum for Michael J. Horowitz,
Counsel to the Director and General Counsel, Office of Management and Budget,
from Theodore B. Olson, Assistant Attorney General, Office of Legal Counsel,
Re: Chicago School Case at 15-16 & n.9 (Aug. 6, 1984) (“ Chicago School
Case") ( “ The essence of such non-delegable functions is that the President alone
retains, and must constitutionally retain, the discretion to perform them.” ). Such
a settlement would authorize a private party or the courts to constrain the exercise
of the very unfettered discretion that the Constitution has vested in the President,
and thus the very discretionary character of those constitutionally vested powers
precludes the executive branch from entering into a settlement that would con­
strain their otherwise unfettered future exercise. See generally Delegation Memo
at 28. As a result, Congress may not authorize the executive branch to settle litiga­
147
Opinions o f the Office o f Legal Counsel in Volume 23
tion on terms that would interfere with the exercise of such non-delegable, con­
stitutionally-committed executive discretion.
2. Article III Limitations on the Settlement Power. Article III provides that
“ [t]he judicial Power of the United States shall be vested in one supreme Court,
and in such inferior Courts as the Congress may from time to time ordain and
establish.” See U.S. Const, art. Ill, § 1. Article III federal courts may not enforce
unauthorized executive branch settlements, and, for that reason, the scope of the
Attorney General’s settlement power, as defined by both statutory and constitu­
tional limitations, necessarily limits the enforcement power of federal courts. See
Costle Memo at 2 (explaining that “ one must first determine what the agency
itself has authority to do in the way of agreeing or consenting to limitations on
its own power” ); cf. Winstar, 518 U.S. at 891-92 (considering whether agency
had the statutory authority to enter into a contract that had been allegedly
breached).
Even when the Attorney General has been authorized statutorily and constitu­
tionally to settle litigation in a manner that limits the exercise of executive branch
discretion, Article III may place independent limits on the power of Article III
federal courts to enforce those settlements. The Meese Policy suggests that this
is the chief limitation that applies to the Attorney General’s use of consent
decrees — as opposed to settlement agreements — that limit executive branch
discretion. The Meese Policy apparently assumes that Article III prohibits an
Article III federal court from entering a consent decree of this type unless the
court could have imposed an ordinary injunction that would have imposed the
same limitations on the exercise of executive discretion. See Cooper Press Con­
ference at 8 (“ Our position is, obviously, that no judge can or no judge’s powers
are enhanced by the agreement of the parties before him. His powers are limited,
in a consent decree, to those that . . . he or she could exercise in a litigated
decree. You can’t go beyond it. And that is, I guess, one of the fundamental
premises of these consent decree guidelines.” ). It therefore states that “ [a] depart­
ment or agency should not limit its discretion by consent decree where it would
assert that a similar limitation imposed by injunction unduly or improperly con­
strains executive discretion.” Meese Policy at 3. This aspect of the Meese Policy
apparently rests on the view that consent decrees, as enforceable court orders,
must, by reason of Article III, necessarily be more limited in scope than settlement
agreements, which are merely a species of contract.
After the Meese Policy was issued, however, the Supreme Court set forth a
more expansive conception of the permissible scope of consent decrees than the
one on which the Meese Policy apparently rests. See Local 93, Int’l A ss’n of
Firefighters v. City o f Cleveland, 478 U.S. 501 (1986). While acknowledging that
federal courts are not mere “ ‘recorders] of contracts’ from whom parties can
purchase injunctions[,]” id. at 525 (citation omitted), the Court explained that
it is the parties’ agreement, “ rather than the force of the law upon which the
148
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
complaint was originally based, that creates the obligations embodied in a consent
decree.” Id. at 522. As a result, Firefighters held that consent decrees were distin­
guishable from ordinary injunctions, and that Article III federal courts could use
consent decrees to provide “ broader relief than [courts] could have awarded after
a trial.” Id. The Court ruled that so long as an agreement between parties resolves
a dispute within the court’s subject matter jurisdiction, comes within the general
scope of the case made by the pleadings, furthers the purposes of the law on
which the complaint is based, and does not otherwise violate federal law, it may
be entered as a consent decree even though its terms could not have been included
in an ordinary injunction and even though the decree itself has the force of a
court order. See id. at 525-26.
The Supreme Court reaffirmed Firefighters in Rufo, another case decided after
the Meese Policy had been issued. In setting forth the legal standard that governs
consent decree modification, the Rufo Court explained that a consent decree may
provide relief in excess of what a court could impose absent party consent:
Federal courts may not order States or local governments, over their
objection, to undertake a course of conduct not tailored to curing
a constitutional violation that has been adjudicated. See Milliken
v. Bradley (Milliken II), 433 U.S. 267, 281 (1977). But we have
no doubt lhat, to ‘save themselves the time, expense, and inevitable
risk of litigation,’ United States v. Armour & Co., 402 U.S. 673,
681 (1971), petitioners could settle the dispute over the proper
remedy for the constitutional violations that had been found by
undertaking to do more than the Constitution itself requires (almost
any affirmative decree beyond a direction to obey the Constitution
necessarily does that), but also more than what a court would have
ordered absent the settlement.
502 U.S. at 389. Together, Firefighters and Rufo reaffirm the essential portions
of the longstanding rule that “ [p]arties to a suit have the right to agree to any
thing they please in reference to the subject-matter of their litigation, and the
court, when applied to, will ordinarily give effect to their agreement, if it comes
within the general scope of the case made by the pleadings.” Pacific R.R. v.
Ketchum, 101 U.S. 289, 297 (1879).
Although both Rufo and Firefighters involved decrees that limited state and
local governmental discretion, rather than federal executive branch discretion, we
do not believe that this distinction is of consequence for purposes of determining
the limits that inhere in Article III. In upholding the decree in Firefighters, the
Court approvingly cited the D.C. Circuit’s opinion in Citizens fo r a Better
Environment, see Firefighters, 478 U.S. at 525, which expressly rejected the
contention that the Constitution prohibits a consent decree — but not a settlement
149
Opinions o f the Office o f Legal Counsel in Volume 23
agreement — from imposing limits on executive branch discretion unless the same
limits could have been imposed by injunction after trial. See Citizens for a Better
Env’t v. Gorsuch, 718 F.2d 1117, 1126-29 (D.C. Cir. 1983). Other courts of
appeals have concurred in this conclusion with respect to settlements by the fed­
eral government. See, e.g., Berger v. Heckler, 771 F.2d 1556 (2d Cir. 1985)
(approving consent decree involving Department of Health and Human Services);
Turner v. Orr, 759 F.2d 817 (11th Cir. 1985) (approving consent decree involving
Secretary of the Air Force), cert, denied, 478 U.S. 1020 (1986); Sansom Com­
mittee v. Lynn, 735 F.2d 1535, 1540 (3d Cir.) (approving consent decree involving
Department of Housing and Urban Development), cert, denied, 469 U.S. 1017(1984). Thus, we do not believe that Article III prohibits a federal court from
entering a consent decree that provides broader relief than the court could have
ordered in the absence of consent, even when the terms of the decree would limit
the exercise of executive branch discretion.
Nor do we believe that the judicial enforcement of a term of a settlement,
whether such term is contained in a consent decree or a settlement agreement,
is beyond the powers of an Article III court whenever such enforcement would
take the form of an injunction that could not have been imposed in the absence
of a settlement. The Supreme Court’s decision in Vermont Yankee Nuclear Power
Corp. v. Natural Resources Defense Council, Inc., 435 U.S. 519 (1978), is not
inconsistent with this conclusion. In Vermont Yankee, the Court held that Article
III federal courts were barred, for separation of powers reasons, from imposing
rulemaking procedures upon executive branch agencies that go beyond those
procedures that Congress had required the agency to obey. Id. at 524—25. The
Court did not address, however, the distinct question whether federal courts were
similarly precluded from requiring executive branch agencies to adhere to the
terms of settlements that they had voluntarily entered into in order to resolve
litigation.
Outside the settlement context, lower federal courts have held that Vermont
Yankee does not apply to bar the judicial enforcement of a procedure that an
agency has voluntarily adopted in the exercise of its administrative discretion so
long as there is some independent legal limitation on the agency’s authority to
deviate from that procedure once it has been adopted. See, e.g., USAir, Inc. v.
Department o f Transp., 969 F.2d 1256, 1260 (D.C. Cir. 1992). Under these
decisions, Article III courts may, consistent with Vermont Yankee, preclude an
agency from deviating from a procedure even though Congress has not mandated
that the agency adopt such a procedure in the first instance. So long as Congress
has authorized an agency to exercise its discretion in a manner that imposes new
procedural obligations upon it, and has precluded the agency from divesting itself
of those obligations without following certain independent, statutorily-prescribed
procedures, a federal court may hold the agency to the procedures that it initially
adopted as a matter of discretion until such time as it has withdrawn those proce­
150
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
dural requirements in the manner that Congress has prescribed. See International
Fabricare Inst. v. EPA, 972 F.2d 384, 389 (D.C. Cir. 1992) (explaining that the
Administrative Procedure Act requires agencies to adhere to procedural rules
which they adopt even when those rules are not themselves required by statute).
This same logic indicates that when agencies consent to settlement terms that
accord with statutory limitations but compel them to exercise their statutorily con­
ferred discretion in the absence of any statutory mandate to do so, no Article
III problem of the type identified in Vermont Yankee arises from the fact that
the settlement thereby empowers a federal court to hold the agency to its volun­
tarily assumed obligations in a manner that comports with the applicable statutes.
See Citizens for a Better Env’t, 718 F.2d at 1127-29, Costle Memo at 5-6. The
rationale for this conclusion rests on the essential distinction for separation of
powers purposes between the judicial enforcement of a voluntarily assumed, and
congressionally authorized, executive branch obligation and the judicial imposition
of an executive branch obligation that the agency has not assumed and that Con­
gress has not required it to assume. In other words, the rationale rests on the
very distinction between consent decrees and injunctions that the Court described
in Firefighters. See, e.g., Citizens for a Better Env’t, 718 F.2d at 1128 (“ ‘mani­
festly the requirements imposed by the Decree do not represent judicial intrusion
into the Agency’s affairs to the same extent they would if the Decree were ‘a
creature of judicial cloth’ ” ) (quoting Weinberger v. Catholic Action of Hawaii/
Peace Educ. Project, 454 U.S. 139, 141 (1981)); see Costle Memo at 5-6.
Moreover, the judicial enforcement of executive branch settlements that purport
to limit the exercise of executive branch discretion generally do not conflict with
the Article III rule that “ [q]uestions of policy are not submitted to judicial deter­
mination, and the courts have no general authority of supervision over the exercise
of discretion which under our system is reposed in the people or other departments
of government.” Green v. Frazier, 253 U.S. 233, 240 (1920). This general limita­
tion on Article III federal court power serves to prevent a federal court from
compelling an executive branch entity to exercise the discretion that Congress
has conferred in a particular manner by, for example, imposing a procedural
requirement upon an agency that Congress has not itself imposed. An Article III
federal court ordinarily lacks the authority — in the absence of a contrary constitu­
tional imperative, such as the requirement of due process of law — to make the
policy determination regarding the procedures that an agency should adopt both
because Congress has delegated the discretion to make such determinations to
the agency and because of the discretionary nature of the determination. See
Vermont Yankee, 435 U.S. at 524—25.
This general limitation on the power of Article III federal courts does not, how­
ever, suffice to prevent the judicial enforcement of a procedural requirement with
which an agency has agreed to comply in a consent decree or settlement agree­
ment. The enforcement of a requirement contained in a settlement generally will
151
Opinions o f the Office o f Legal Counsel in Volume 23
not require an Article HI federal court to make a policy judgment regarding the
merits of that requirement. Enforcement of such a requirement will merely require
an Article III federal court to perform its core function of enforcing a congression­
ally authorized limitation on executive branch policymaking discretion — namely,
the limitation that the executive branch agency has itself adopted, in the exercise
of its statutorily conferred discretion, through its consent to the requirement con­
tained in the decree or settlement agreement. In this respect, the judicial enforce­
ment of settlement terms does not differ for purposes of Article Ill’s restriction
on the authority of federal courts to decide ‘‘questions of policy’’ from the judicial
enforcement of statutory limits on executive branch discretion. See Berger, 111
F.2d at 1579 (comparing consent decree requiring agency to issue regulations to
injunction requiring agency to redraft regulations to bring them into compliance
with statute).
As we have suggested, however, Article HI does place independent limits on
the power of Article III federal courts to enforce executive branch settlements
in some circumstances. Cf. Morrison v. Olson, 487 U.S. 654, 680-81 (1988)
(Article III judges “ may not encroach upon executive or legislative authority or
undertake tasks that are more properly accomplished by those branches.” );
Buckley v. Valeo, 424 U.S. 1, 123 (1976) (Article III courts may not exercise
“ executive or administrative duties of a nonjudicial nature.” ). For example,
executive branch settlements may not be enforced if their terms lack judicially-
discoverable and manageable standards for enforcement, cf. Baker v. Carr, 369
U.S. 186, 217 (1962) (discussing political question doctrine), or depend upon the
enforcing court to make “ an initial policy determination of a kind clearly for
nonjudicial discretion.” The precise nature of these limits are unclear, and we
are not aware of any settlements that the Supreme Court has deemed unenforce­
able as a consequence of these ill-defined limits. See, e.g., William A. Fletcher,
The Discretionary Constitution: Institutional Remedies and Judicial Legitimacy,
91 Yale L.J. 635 (1982); Robert F. Nagel, Separation of Powers and the Scope
o f Federal Equitable Remedies, 39 Stan. L. Rev. 661 (1978).14
Some guidance as to the types of judicial judgments that would transgress the
limitations on the judicial power that are imposed by Article III may be found
in our opinion on the constitutional concerns that arose in the context of a pro­
14 The D.C. C ircuit recently expressed concern that the general and amorphous “ public interest” standard that
the Tunney Act, 15 U S.C § 16(e) (1994), instructs courts to apply in reviewing the United States’ authority to
enter proposed consent decrees for the resolution of antitrust suits violates Article III. See United States v Microsoft
Corp., 56 F.3d 1448 (D.C C ir 1995) (concluding that judicial rejection of consent decree under the “ public interest”
standard violated the Tunney Act and that a contrary interpretation of the judicial authority conferred by the Act
would raise substantia] Article III concerns), see also M aryland v. United States, 460 U.S 1001 (1983) (Rehnquist,
J , joined by Burger, C J., and White, J , dissenting), Constitutionality o f the Qui Tam Provisions o f the False Claims
A ct, 13 Op. O L C 207, 219 n.7 (1989) (noting that there are “ very senous doubts as to the constituuonality”
o f the Tunney Act because it “ intrudes into the executive pow er and requires courts to decide” policy questions
normally reserved for the political branches); but c f Cascade Natural Gas Corp. v. El Paso Natural Gas Co., 386
U.S 129, 141 (1967) (rejecting anutmst “ settlement” after noting that the Department of Justice had “ knuckled
under” ); United States v. CIBA Corp , 50 F.R .D 507 (S.D N.Y. 1970) (reviewing post-Cascade cases)
152
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
posed modification to a consent decree that the Attorney General had entered into
in an antitrust suit. See Memorandum for Kenneth G. Starling, Deputy Assistant
Attorney General, Antitrust Division, from John O. McGinnis, Deputy Assistant
Attorney General, Office of Legal Counsel, Re: Legal Implications of Antitrust
Division's Failure to Accede to Judge’s Requested Modification o f Antitrust Con­
sent Decree at 11 (May 4, 1988). Among the types of judgments that we identified
in that opinion as constitutionally problematic for an Article III court to make
were “ weighing the relative merits of imposing particular side-conditions vis-a-
vis formulating alternative consent decree proposals for judicial consideration;
determining what the benefits (or costs) of further prosecution would be; assessing
how particular strategies may enhance the effectiveness of antitrust enforcement
and aid the Executive Branch’s overall policies and programs; and determining
how the Government’s limited law enforcement resources may best be used.”
Id. We note as well that the Supreme Court has suggested that it would transgress
the bounds of Article III for federal courts to “ supervise” the prosecutorial discre­
tion of the executive branch. See Morrison , 487 U.S. at 681 (upholding the Inde­
pendent Counsel Act and noting that it did not confer upon the federal courts
“ the power to ‘supervise’ the independent counsel in the exercise of his or her
investigative or prosecutorial authority” ).
These limitations on the scope of an Article III court’s authority were identified,
however, in connection with the consideration of statutory provisions that con­
ferred authority upon Article HI federal courts either to limit the executive
branch’s power to modify a decree or to exercise some measure of control over
appointment and removal of the independent counsel. Here, by contrast, we are
concerned with the authority of Article III courts to review and enforce the terms
of settlements entered into by executive branch actors pursuant to the exercise
of their congressionally conferred authority. It is conceivable that Article III fed­
eral courts would have somewhat greater authority in the context of enforcing
the terms of a settlement that the executive branch had itself consented to enter.
Nevertheless, the executive branch surely has no power to expand the types of
questions that an Article III court may resolve to include the resolution of policy
questions that are not ordinarily susceptible of judicial determination. As a general
matter, therefore, settlements that confer upon federal courts the broad authority
to determine whether executive branch enforcement action has met some general
standard, as opposed to whether it has satisfied a specific promise to undertake
previously specified action, would raise Article III concerns.
Of course, litigation compromises that would require Article III judges to make
the kind of determinations in the course of enforcing their terms that would press
the bounds of Article III also would likely raise substantial constitutional concerns
independent of the limitations imposed upon the exercise of the judicial power
by Article III. As we have explained, settlements that contain terms that authorize
Article III judges to make discretionary determinations in the course of the exer­
153
Opinions o f the Office o f Legal Counsel in Volume 23
cise of their enforcement powers may be objectionable as impermissible delega­
tions of executive branch authority under Article II. Cf. The Constitutional Separa­
tion o f Powers, 20 Op. O.L.C. at 176-77 (discussing delegations to actors outside
the federal government that have been made pursuant to congressional mandates).
Settlements that contain such open-ended terms potentially confer too much
authority over the exercise of congressionally conferred executive authority upon
the non-executive branch actors with whom the settlement is effected, and for
that reason could be constitutionally suspect without regard to the limitations that
Article III places on federal court enforcement. Id.
Notwithstanding the Article III limitations described above, executive branch
settlements that limit the future exercise of congressionally conferred executive
discretion do not necessarily, or even generally, require Article III federal courts
to make constitutionally suspect policy judgments in enforcing their terms. Gen­
erally, the judiciary is simply called upon to enforce a clear limitation that the
executive branch has voluntarily adopted, in much the same manner that the
judiciary may be called upon to enforce either an administrative procedure that
an agency has agreed, in its discretion, to be bound by, or a clear statutory limita­
tion that has been imposed upon an executive branch actor’s discretion. Moreover,
out of respect for the limits that Article III imposes on the judiciary’s power to
supervise executive branch decision making, federal courts generally construe the
terms of authorized executive branch settlements narrowly so as to avoid the
conclusion that the executive branch has agreed to submit the exercise of other­
wise unreviewable discretion to judicially enforceable limits. See, e.g., Alliance
to End Repression v. City of Chicago, 742 F.2d 1007, 1019 (7th Cir. 1984) (con­
struing consent decree narrowly to avoid constraining investigatory discretion of
FBI); National Audubon Soc'y, Inc. v. Watt, 678 F.2d 299, 305 n.12, 306 (D.C.
Cir. 1982) (construing stipulation committing Secretary of Interior to stay federal
construction project narrowly to avoid constitutional concerns).
IV. Specific Limits Set Forth in the Meese Policy
A. Promises to Spend Unappropriated Funds or to Seek Appropriations
We now consider the more specific limits on the Attorney General’s settlement
power that the Meese Policy identifies. We begin with the Attorney General’s
power to settle litigation on terms that commit the executive branch to expend
unappropriated funds or to seek congressional appropriations.
The Meese Policy states that lawyers under the Attorney General’s supervision
may not enter into consent decrees that “ commit[] the department or agency to
expend funds that Congress has not appropriated and that have not been budgeted
for the action in question, or commits a department or agency to seek a particular
appropriation or budget authorization.” Meese Policy at 3. The policy also pro­
154
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
hibits such attorneys from entering into settlement agreements that “ commit[]
the Department or agency to expend funds that Congress has not appropriated
and that have not been budgeted for the action in question.” Meese Policy at
3 _ 4 . i 5 We are advised that the policy aids agencies in settlement negotiations
by circumscribing the possible scope of a settlement, see Memorandum for John
R. Schmidt, Associate Attorney General, from Lois Schiffer, Assistant Attorney
General, Environment and Natural Resources Division, Re: Department Policy
Regarding Consent Decrees and Settlement Agreements (Nov. 1, 1994), but our
concern is solely with the degree to which federal law precludes settlements that
would contain such commitments.
1. The legal limits on commitments to make unappropriated expenditures. The
Appropriations Clause states that “ No Money shall be drawn from the Treasury,
but in Consequence of Appropriations made by Law.” U.S. Const, art. 1, §9,
cl. 7. The Clause “ assurefs] that public funds will be spent according to the letter
of the difficult judgments reached by Congress as to the common good and not
according to the individual favor of Government agents or the individual pleas
of litigants.” Office o f Personnel Management v. Richmond, 496 U.S. 414, 427-
28 (1990). The Anti-Deficiency Act implements and enforces this principle by
prohibiting executive officials from making promises to expend funds in advance
of appropriation unless “ authorized by law.” 31 U.S.C. § 1341 (1994).
Neither the Antideficiency Act nor the Appropriations Clause compels a blanket
prohibition against settlements that require the executive branch to expend
unappropriated funds. The Appropriations Clause does not preclude authorized
promises to make expenditures or to incur obligations in advance of appropria­
tions, and such promises, if authorized by Congress, do not wrest the power of
the purse from Congress. Nor do binding commitments to pay money in advance
of appropriations place unconstitutional constraints on the exercise of executive
discretion. Such commitments may restrict the discretion of executive branch
actors in the future by imposing financial obligations that either limit future
expenditures or necessitate request for additional appropriations, but the Constitu­
tion does not prohibit executive branch actions that have these consequences. See
United States v. Winstar Corp., 518 U.S. 839, 873-74 (1996) (holding United
States liable for prior promises to bear costs of regulatory change made by execu­
tive branch agency officials); Fletcher v. Peck, 10 U.S. (6 Cranch) 87, 135 (1810);
Percival, supra at 344 (“ By necessity, executive agencies undertake many actions
that have a profound impact on the policy choices available to future administra­
tions.” )
15 Although the policy distinguishes between commitments concerning funds “ appropriated” and commitments
concerning funds “ budgeted,” u is not clear what that distinction is intended to signify, and, in any event, the
Constitution does not suggest any such distinction. Nor does the Constitution require the policy’s different rules
regarding funding commitments made in consent decrees and settlement agreements, at least insofar as the com m it­
ment contained in each type o f settlement is intended to be enforceable by an Article III court.
155
Opinions o f the Office o f Legal Counsel in Volume 23
Indeed, the Antideficiency Act implicitly recognizes that promises to expend
unappropriated funds are constitutional because it excepts “ authorized” promises
of this type from its reach, and courts have held that authorized promises to
expend unappropriated funds give rise to enforceable obligations on the United
States. See Louis Fisher, The Authorization-Appropriation Process in Congress:
Formal Rules and Informal Practices, 29 Cath. U. L. Rev. 51, 61-62 (1979) (col­
lecting cases).16 Thus, just as Congress may authorize executive branch officials
to impound appropriated funds in certain circumstances, see, e.g., Train v. City
of New York, 420 U.S. 35, 42-47 (1975), it may authorize executive branch offi­
cials to commit to the expenditure of unappropriated funds in certain cir­
cumstances as well.
Nevertheless, as we have explained, the settlement power may not be exercised
in a manner that is inconsistent with statutory limits. This general principle, as
applied in this context, means that the limitations that applicable statutory provi­
sions place on the authority of an agency to incur financial obligations in advance
of appropriations outside the settlement context will, at least in the ordinary case,
also limit the authority of the Attorney General to settle litigation on behalf of
that agency on terms that would incur such obligations. In light of the express
terms of the Anti-Deficiency Act,17 this general principle, as applied here, also
means that there must be an identifiable source of statutory authority to incur
an obligation in advance of an appropriation before a settlement may be entered
that would incur one.
The question whether such authority exists will sometimes be a difficult one.
As Professor Tribe explains in discussing the distinct, but nonetheless related, con­
text of impoundment, Congress may authorize impoundment implicitly rather than
expressly:
[t]he language and purpose of a particular appropriations bill
involved may permit the conclusion that impoundment is consistent
with the legislative will. In some cases, the appropriations bill very
clearly invests the Executive branch with wide discretion regarding
the spending level. In other cases, the use of mandatory language
indicates that Congress has not sanctioned impoundment. Needless
to say, the vast majority of cases fall somewhere between these
16 For exam ple, if a statute authorizes the government to contract for goods and services and the contract is per­
formed, an obligation may arise that the United States may not avoid simply by refusing to appropriate funds See
Fisher, supra at 61. (O f course, it may be that the obligation will not be satisfied if Congress refuses to appropriate
the funds lawfully due.) By contrast, when statutes expressly condition performance by the United States upon
congressional appropriations, the government’s promise may be enforced only if an appropriation is forthcoming
Id. at 62.
n T he Anti-Deficiency Act provides, in relevant part, that “ [a]n officer or employee of the United States Govern­
ment or o f the District o f Columbia government may not . . . make or authorize an expenditure or obligation
exceeding an amount available in an appropriation or fund for the expenditure or obligation” and may not ‘‘involve
either government in a contract or obligation for the payment o f money before an appropriauon is made unless
authorized by law .” 31 U.S.C. § 1341(a)(1)(A), (B).
156
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
two polls. The Supreme Court has indicated that it will study the
legislative history of the appropriations statute and carefully dissect
its language in order to determine whether impoundment is permis­
sible.
See Laurence H. Tribe, American Constitutional Law 259 n.13 (2d ed. 1988).
There is a similar range from the express to the implied grant among statutory
provisions that grant executive branch officials the authority to commit to financial
obligations in advance of appropriations.
In 1980, Attorney General Civiletti elaborated on this point in setting forth the
proper analysis for determining whether an agency or official possesses the statu­
tory authority to assume a financial obligation in advance of an available appro­
priation. See Authority for the Continuance of Government Functions During a
Temporary Lapse in Appropriations, 5 Op. O.L.C. 1 (1981). The analysis that
he set forth does not make express reference to the settlement context, but it pro­
vides useful guidance nonetheless. Attorney General Civiletti explained that “ [i]n
a few cases Congress has expressly authorized agencies to incur obligations with­
out regard to available appropriations,” id. at 3 & n.4 (citing 25 U.S.C. §99;
31 U.S.C. §668; 41 U.S.C. §11), but that it will often be “ necessary to inquire
under what circumstances statutes that vest particular functions in government
agencies imply authority to create obligations for the accomplishment of those
functions despite the lack of current appropriations.” Id. at 3. In general, he con­
cluded, “ statutory authority to incur obligations in advance of appropriations may
be implied as well as express, but may not ordinarily be inferred, in the absence
of appropriations, from the kind of broad, categorical authority, standing alone,
that often appears, for example, in the organic statutes of government agencies.”
Id. at 4. The authority to make such a commitment instead “ must be necessarily
inferrable from the specific terms of those duties that have been imposed upon,
or of those authorities that have been invested in, the officers or employees pur­
porting to obligate funds on behalf of the United States.” Id.
In further elaborating upon this analysis, Attorney General Civiletti referred to
prior Attorney General opinions that had established that “ when Congress specifi­
cally authorizes contracts to be entered into for the accomplishment of a particular
purpose, the delegated officer may negotiate such contracts even before Congress
appropriates all the funds necessary for their fulfillment.” Id. He also explained,
however, that other Attorney General opinions had established that “ when
authority for the performance of a specific function rests on a particular appropria­
tion that proves inadequate to the fulfillment of its purpose, the responsible officer
is not authorized to obligate further funds for that purpose in the absence of addi­
tional appropriations.” Id. As a consequence, the scope of “ necessarily
inferrable” authority to incur financial obligations in advance of appropriations
is quite limited. As we have more recently explained, the “ limited number of
157
Opinions o f the Office o f Legal Counsel in Volume 23
government functions funded through annual appropriations [that] must otherwise
continue despite a lapse in their appropriations’’ include, for example, the ‘‘check
writing and distributing functions necessary to disburse” benefits that operate
under indefinite appropriations, the minimal duties that are necessary to closing
up an agency during a lapse in appropriations, and the contracting for materials
essential to the performance of those emergency services that may continue during
a lapse pursuant to an express provision of the Anti-deficiency Act. See Memo­
randum for Alice Rivlin, Director, Office of Management and Budget, from Walter
Dellinger, Assistant Attorney General, Office of Legal Counsel, Re: Government
Operations in the Event o f a Lapse in Appropriations at 4 (Aug. 16, 1995).
Attorney General Civiletti added that, notwithstanding the statutory limitations
that would ordinarily constrain executive branch authority to incur obligations in
advance of appropriations, “ the President performs not only functions that are
authorized by statute, but functions authorized by the Constitution as well.” 5
Op. O.L.C. at 5. He therefore concluded that “ the Antideficiency Act should not
be read as necessarily precluding exercises of executive power through which the
President, acting alone or through his subordinates, could have obligated funds
in advance of appropriations had the Antideficiency Act not been enacted.” Id.
at 6. He then identified the conduct of foreign affairs essential to the national
security as “ [o]ne likely category into which certain of these functions would
fall.” Id. at 7 n.10.
In accord with the above analysis, settlements may raise concerns if they contain
terms that contemplate the federal government undertaking actions to be carried
out beyond the current appropriations cycle or the terms of the appropriation that,
at the moment of settlement, is understood to provide the funding for carrying
them out. It may be unclear in such cases whether, at the moment of settlement,
funds have been appropriated for carrying out those actions in the future. It may
also be unclear whether statutory authority exists that would permit the Attorney
General to assume an obligation for the federal government to carry out activities
in advance of appropriations to fund them.
Of course, in many instances, the source of the funding for the activity may
be the general salaries and expenses appropriation of an agency. Such an appro­
priation for general salaries and expenses may be available for only one year,
but it will in most cases almost certainly be replaced with a substantial, similarly
general appropriation the following year. The fact that an available appropriation
may be reasonably expected in the following year, however, does not suffice to
relieve concern that an executive branch promise to undertake actions in subse­
quent years may constitute an unauthorized promise to expend funds or incur
obligations in advance of an appropriation. An expectation of an appropriation
does not itself constitute an appropriation. Thus, absent sufficient authorization,
care should be taken to avoid promising to undertake activities in advance of
appropriations in entering into even seemingly routine settlements. The possibility
158
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
always exists, for example, that an appropriations rider may be appended to the
otherwise generally available salaries and expenses appropriation in a subsequent
year, which would preclude use of the appropriated funds for the promised pur­
pose.
Because of the limited circumstances in which it is likely to be determined
that Congress has conferred the unusual authority to incur financial obligations
in advance of appropriations, settlements that would commit the executive branch
to undertake activities that would require expenditures in the future should not
be understood to constitute enforceable obligations to undertake such activities
in the event of lapses in available appropriations unless it is made clear in the
settlement'that the federal government does intend to incur such an obligation.
Cf United States v. International Brotherhood o f Teamsters, 172 F.3d 217 (2d
Cir. 1999) (holding that the United States had not promised to monitor a union
election). In addition, the executive branch should make clear its intention to incur
an obligation in advance of appropriations only when (1) the statutory authority
to assume a financial obligation in advance of an appropriation may be divined
from either express statutory language or “ necessary implication from the specific
terms of duties that have been imposed on, or of authorities that have been
invested in, the agency,” 5 Op. O.L.C. at 5, or (2) the obligation in question
is “ necessarily incident to presidential initiatives undertaken within his constitu­
tional powers.” Id. at 7.
The existence of the continuing and indefinite appropriation for the satisfaction
of certain judgments and settlements, commonly referred to as the judgment fund,
does not suffice to constitute broad authorization for settlements that would other­
wise appear to constitute unauthorized obligations in advance of appropriations.
See 31 U.S.C. § 1304 (1994 & Supp. II 1996). “ A law that identifies the source
of funds is not to be confused with the conditions prescribed for their payment.”
Office of Personnel Management, 496 U.S. at 432. The general statute appro­
priating funds for judgments and settlements appropriates funds for the payments
obligated only by certain types of authorized settlements. Id. It is important to
note, in this regard, that the settlements identified in the Meese Policy are likely
to give rise to expenditures that would not be payable out of the judgment fund.
For example, it is likely that Congress will have intended for agency appropria­
tions to fund the activity that the government promises to perform in the settle­
ment, and the mere fact that such agency appropriations are insufficient to permit
the activity to be performed will not suffice to make the judgment fund available.
See Availability o f the Judgment Fund for the Payment o f Judgments or Settle­
ments in Suits Brought Against the Commodity Credit Corporation Under the Fed­
eral Tort Claims Act, 13 Op. O.L.C. 362, 366 n.6 (1989) (quoting 66 Comp.
Gen. 157, 160 (1986)); see 3. Office of the General Counsel, United States General
Accounting Office, Principles o f Federal Appropriations Law 14—26 (2d ed. 1994)
(“ [I]f payment of a particular judgment is ‘otherwise provided for’ as a matter
159
Opinions o f the Office o f Legal Counsel in Volume 23
of law, the judgment appropriation is not available, and the fact that the defendant
agency may have insufficient funds at that particular time does not operate to
make the judgment appropriation available.” ). Similarly, it is likely that the terms
of such settlements will not be appropriately characterized as involving “ money
judgment’’ claims, and thus that they will fall outside the scope of the judgment
fund for that reason. See Availability of Judgment Fund in Cases Not Involving
a Money Judgment Claim , 13 Op.O.L.C. 98, 98-99 (1989) (explaining that “ final
judgments [or settlements of such judgments] whose payment is not ‘otherwise
provided for’ are payable from the Judgment Fund if they require the government
to make direct payments of money to individuals, but not if they merely require
the government to take actions that result in the expenditure of government
funds.” ). Thus, the judgment fund should not be thought to obviate the need for
an inquiry into either whether funds would be available in the future or whether
authority exists for the executive branch to incur an obligation in advance of avail­
able appropriations.
2. The legal limits on executive branch commitments to seek appropriations
from Congress. We previously considered this question in connection with a pro­
posed consent decree that would have required the Departments of Navy and
Energy to seek certain appropriations from Congress. We concluded that such
a commitment would not have been judicially enforceable. We explained that this
conclusion followed from the position we had previously taken that ‘‘no executive
branch official, including the President, constitutionally could agree to constrain
the President’s discretion to make whatever legislative proposals he or his succes­
sors deemed desirable[.]” Letter for Steven S. Honigman, General Counsel,
Department of the Navy, and Robert R. Nordhaus, General Counsel, Department
of Energy, from Walter Dellinger, Assistant Attorney General, Office of Legal
Counsel (Sept. 12, 1995) (“Honigman Letter” ).
The constitutional constraint is rooted in Article II, Section 3 of the Constitution,
which confers upon the President the duty to “ recommend to [Congress’s] Consid­
eration such Measures as he shall judge necessary and expedient.” Through this
clause, the Constitution expressly commits the President to exercise his personal
discretion in making legislative recommendations to Congress. See Chicago
School Case at 17-18; see generally J. Gregory Sidak, The Recommendations
Clause, 11 Geo. L.J. 2079 (1989) (discussing history of the Clause).18 The Presi­
dent may not divest himself of his constitutional obligation to judge personally
which recommendations should be made to Congress, and thus he may not dele­
gate the authority to exercise that discretion to another person. See Delegation
18 Some have argued that the Recommendations Clause m akes plain that the President is constitutionally permitted
to recommend legislation to Congress and does not restrict the President’s ability to forego the exercise of his personal
discretion in making such recommendations. See, e g , Chicago School Case at 17. O ur office has rejected that
view. See id at 17-18; Honigman Letter, supra.
160
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
Memo at 32 (“ if the messages or recommendations are intended to be in exercise
of Constitutional duties, the President cannot delegate the responsibilities” ).
A settlement of the type at issue in this memorandum that contains a presidential
promise to seek certain legislation would constitute an impermissible delegation
of the President’s Recommendations Power. As we have explained, we are con­
cerned in this memorandum only with settlements the terms of which would be
subject to direct enforcement by an Article III court. In consenting to a settlement
of this type containing a term requiring the President to seek certain appropriations
from Congress, the Attorney General necessarily would be consenting to the
issuance of a judicial order compelling the President to make a certain legislative
recommendation in the event that he failed to do so in conformity with the settle­
ment. In this respect, such a settlement would necessarily delegate a portion of
the President’s recommendation power to the other party to the agreement, as
it would permit that party to call upon the court to require the President to make
a legislative recommendation, even if the President’s own judgment at the moment
of enforcement were that such a recommendauon was neither necessary nor expe­
dient. Chicago School Case at 15-16 & n.9. Because of the President’s constitu­
tional obligation to exercise personal discretion in making recommendations to
Congress, moreover, courts are likely to construe narrowly promises that appear
to commit the President to seek certain appropriations from Congress. See id.
Settlements that commit executive branch officials to make certain legislative
recommendations are constitutionally problematic even if they do not purport to
preclude the President from making recommendations on his own. The President’s
constitutional authority to exercise the Recommendations Power could be under­
mined if the President were precluded from preventing a subordinate executive
branch official from making a recommendation by reason of the executive
branch’s prior consent to a binding term of a settlement. For example, the Presi­
dent may judge that it is necessary or expedient that no recommendation on a
particular matter be made at a particular time. However, that presidential judgment
would be compromised if an executive branch actor’s prior entry into a settlement
could give rise to a judicially enforceable obligation that an executive branch offi­
cial make a recommendauon on the precise issue on which the President had
judged it necessary and expedient to remain silent. Similarly, the President may
have judged that it is necessary and expedient to make a recommendauon, the
terms of which would contradict the recommendation that a prior settlement would
require a subordinate executive branch actor to make. The President’s ability to
exercise his own recommendation power could be undermined if he lacked the
power to preclude a subordinate from presenting a contradictory recommendation
to Congress. Thus, such commitments, even if made by subordinate executive
branch officers could “ constrain the President’s discretion to make whatever legis­
lative proposals he or his successors deemed desirable[.]” Honigman Letter at
1.
161
Opinions o f the Office o f Legal Counsel in Volume 23
In addition, Article II, Section 2, Clause 1 of the Constitution states that “ [the
President] may require the Opinion, in writing, of the principal Officer in each
of the executive Departments, upon any subject relating to the Duties of their
respective Offices.” A settlement may not commit a principal officer in a Depart­
ment to recommend certain appropriations to Congress if such a commitment
would impinge upon the President’s capacity to obtain information pursuant to
the Opinion Clause. For example, an agreement that precluded the officer from
disavowing the recommendation when asked by the President for his views would
impermissibly interfere with the free flow of information to the President con­
templated by the Opinion Clause. See Relation of the President to the Executive
Departments, 1 Op. Att’y Gen. 453, 463 (1855) (explaining that the Opinion
Clause requires that the “ advice or opinion must of course embody the individual
thought of the officer giving it” ); Akhil Reed Amar, Some Opinions on the
Opinion Clause, 82 Va. L. Rev. 647, 672-73 (1996) (discussing how the Clause
facilitates the President effective execution of the laws). Finally, the judicial
enforcement of settlements that require executive branch officials to provide cer­
tain advice within the executive branch, or that commit executive branch officials
to make certain recommendations directly to Congress, would raise serious separa­
tion of powers concerns apart from any limitations that the Recommendations
Clause or the Opinions Clause might impose. See United States v. Nixon, 418
U.S. 683, 708 (1974) (tracing executive privilege to separation of powers concerns
arising from disruption of President’s internal decision making processes); Citizens
to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 420 (1971) (explaining
that “ inquiry into the mental processes of administrative decisionmakers is usually
to be avoided” ); Smith v. United States, 333 F.2d 70, 72 (10th Cir. 1964) (holding
that federal court could not mandamus the Secretary of the Interior to make legis­
lative recommendations to Congress); see Chicago School Case at 17, 19. That
is particularly true when executive branch officials promise to adhere to general
standards of conduct in advising the President, such as making “ best efforts”
in seeking certain appropriations. See Chicago School Case at 19. Promises of
the former type not only invite impermissible judicial supervision of the executive
branch but also lack judicially-manageable enforcement criteria. As the Seventh
Circuit has explained, its decision to construe the executive branch consent decree
contained in United States v. Board o f Educ., 744 F.2d 1300 (7th Cir. 1984),
cert, denied, 471 U.S. 1116 (1985), so as not to require the United States to seek
certain appropriations from Congress was based “ in substantial measure . . . [on
the] concern that judges should not take control of the budgetary process even
with the consent of the parties” See Evans v. City o f Chicago, 10 F.3d 474, 480
(7th Cir. 1993), cert, denied, 511 U.S. 1082 (1994).
162
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
B. Promises to Promulgate Rules
The Meese policy states that a “ department or agency should not enter into
a consent decree that converts into a mandatory duty the otherwise discretionary
authority of the Secretary or agency administrator to revise, amend, or promulgate
regulations.” Meese Policy at 3. The policy also states that a “ department or
agency should not enter into a settlement agreement that interferes with the Sec­
retary or agency administrator’s authority to revise, amend, or promulgate regula­
tions through the procedures set forth in the Administrative Procedure Act.” Id.19
The policy does not identify the types of agency actions that it intends to encom­
pass within the term “ regulations” but we consider a broad range of agency regu­
latory actions below, from the promulgation of legislative rules, which ordinarily
are subject to notice-and-comment requirements, to the initiation of investigations,
which ordinarily are not.
As we have already explained, the Attorney General ordinarily may not settle
litigation on terms that would transgress valid, otherwise applicable, statutory
restrictions on agency conduct. See Executive Bus. Media, Inc. v. United States
D ep’t o f Defense, 3 F.3d 759, 762 (4th Cir. 1993). If, for example, a statute pro­
hibits an agency from considering a particular factor in evaluating whether to pro­
pose a rule, or specifically limits an agency’s consideration of potential rules to
certain enumerated factors, the Attorney General generally may not settle litigation
by committing the agency to consider the prohibited factors in future rule makings.
A contrary conclusion would transform the settlement power into a general dis­
pensing power with respect to those statutes that purported to govern agency con­
duct. C f Motor Vehicle Mfrs. A ss’n v. State Farm Mutual Auto. Ins., Co., 463
U.S. 29, 43 (1983) (explaining that “ an agency rule would be arbitrary and capri­
cious if the agency has relied on factors which Congress has not intended it to
consider” ); Citizens to Preserve Overton Park, 401 U.S. at 416.
Similarly, when the Administrative Procedure Act (“ APA” ) governs the means
by which a rule may be adopted, proposed, or considered, the Attorney General
may not resolve litigation, in the absence of an express congressional authoriza­
tion, by committing an agency to follow a contrary rulemaking process. Cf.
Chrysler Corp. v. Brown, 441 U.S. 281, 302-03 (1979) (holding agency rule not
binding on a court where promulgated in violation of the APA). For example,
the Act may require the agency to proceed only pursuant to notice and comment
rulemaking, thereby precluding the agency from making an enforceable promise
to undertake regulatory action through means other than the notice and comment
,9 While the policy forbids only those consent decrees that would limit the discretion to revise, amend, or promul­
gate regulations, it prohibits any settlement agreements that “ interfere[]” with the revision, amendment or prom ulga­
tion of regulations through procedures set forth in the Administrative Procedure Act. It is not clear whether the
difference in terminology is intended to reflect a difference in substance. For purposes of this memorandum, we
put aside the policy’s distinction between consent decrees and settlement agreements and consider the constraints
that limit the Attorney General’s settlement power generally
163
Opinions o f the Office o f Legal Counsel in Volume 23
procedure. See Environmental Defense Fund, Inc. v. Costle, 636 F.2d 1229,1253-
55 (D.C. Cir. 1980) (rejecting challenge to EPA consent decree brought under
the APA on the ground that the commitment to undertake a preliminary investiga­
tion does not constitute a rule within the meaning of the Administrative Procedure
Act). Thus, while the APA does not, as a general matter, preclude the executive
branch from entering into settlements that would limit the future exercise of
congressionally conferred executive branch discretion, actions taken pursuant to
settlements are not inherently immune from APA review. Id. at 1253-55. To the
extent that a discretion-limiting settlement is subject to APA review, moreover,
it must conform to the substantive and procedural requirements that the APA
imposes upon agency action outside the settlement context. For that reason, settle­
ments that commit an executive branch agency to promulgate substantive rules,
which normally may be promulgated only pursuant to notice and comment proce­
dures, are likely to raise serious concerns that they will transgress the APA’s
limitations on an agency’s rulemaking authority.
In addition to the questions that may arise concerning the limitations that the
APA may impose on an agency’s authority to constrain its regulatory discretion
pursuant to a settlement, it will also be important to ensure that a discretion-
limiting settlement would not divest an agency of discretion that Congress has
mandated that it retain. See Kendall v. United States ex rel Stokes, 37 U.S. (12
Pet.) 524, 609-13 (1838); Binding Arbitration, 19 Op. O.L.C. at 224 (discussing
executive’s obligation to “ comply with the terms of valid statutes” committing
discretionary power to executive branch officials); see also Rabkin & Devins,
supra at 226 (explaining that courts have held that where a statute vests ultimate
decisional responsibility in the executive secretary the secretary cannot delegate
this authority); Morgan v. United States, 304 U.S. 1, 1-4 (1938) (discussing statu­
tory limitations on subdelegation of executive functions). Difficult interpretive
questions arise, however, when the statutes that govern agency conduct confer
discretion without making clear either that the executive branch’s discretion must
be retained or that it may be divested.
For example, numerous statutes authorize agencies to exercise their discretion
to adopt rulemaking procedures beyond those that Congress has expressly man­
dated. See, e.g., USAir, Inc. v. Department o f Transp., 969 F.2d 1256, 1260 (D.C.
Cir. 1992). It is generally presumed that, although agencies are bound to follow
such discretionary procedures once they have been adopted, they retain the power
to revise these discretionary procedures in accord with statutory requirements gov­
erning the process for the revision of such procedures. Id. at 1260. It is far less
clear, however, that Congress, in conferring procedural discretion upon agencies,
intended to permit them to settle litigation on terms that would divest them of
their statutorily conferred power to revise such procedures, and that question will
be present even in circumstances in which the revision would be undertaken in
accord with the statutory provisions governing the process of revision. Similar
164
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
confusions may arise with respect to congressional intent regarding the substantive
regulatory power of agencies. Congress often authorizes agencies to exercise their
discretion in selecting substantive regulatory outcomes without making clear
whether those agencies are precluded from settling litigation on terms that would
preclude them from revising those selections in the future.
Definitive answers to the interpretive questions that arise when the relevant stat­
utes do not clearly address the executive branch’s authority to bind the exercise
of the discretion that has been statutorily conferred will necessarily depend upon
an examination of the particular statutory context. Nevertheless, certain general
principles may help to guide analysis. These principles are set forth in the leading
case to have considered the interpretive questions posed by settlements that pur­
port to regulate the policy discretion of executive branch agencies: Citizens for
a Better Environment v. Gorsuch, 718 F.2d 1117 (D.C. Cir. 1983).
In Citizens fo r a Better Environment, the court considered a legal challenge
to the so-called Flannery Decree, which the Environmental Protection Agency
(“ EPA” ) entered into with environmental groups in order to resolve claims that
it had failed to implement certain provisions of the Clean Water Act (“ CWA” ).
Id. at 1120. The consent decree committed the EPA to a “ detailed program for
developing regulations to deal with the discharge of toxic pollutants under the
CWA.” Id. Specifically, the decree:
required EPA to promulgate guidelines and limitations governing
the discharge by 21 industries of 65 specified pollutants. It also
mandated the use of certain scientific methodologies and decision­
making criteria by EPA in determining whether additional regula­
tions should be issued and whether other pollutants should be
included in the regulatory scheme. It did not specify the substantive
result of any regulations EPA was to propose and only required
EPA to initiate “ regulatory action” for other pollutants identified
through the research program. The regulations envisaged by the
Agreement were, after full notice and comment, to be promulgated
in phases by December 31, 1979 and the industries affected by them
were to comply with them by June 30, 1983.
Id. at 1120-21.
After the district court entered the decree, an appeal was taken, and the court
of appeals remanded for a determination whether the agreement “ impermissibly
infringe[d] on the discretion Congress committed to the EPA Administrator to
make certain decisions under the CWA.” Citizens for a Better Env’t, 718 F.2d
at 1121 (describing decision in Environmental Defense Fund, Inc. v. Costle, 636
F.2d 1229, 1259 (D.C. Cir. 1980)). The court of appeals began by rejecting the
contention that the consent decree exceeded Article III limits on the judicial
165
Opinions o f the Office o f Legal Counsel in Volume 23
power. Anticipating the Supreme Court’s eventual holding in Local 93, Int’l A ss’n
of Firefighters v. City o f Cleveland, 478 U.S. 501, 526 (1986), the court concluded
that Article III permitted the district court to issue the consent decree even though
it provided relief in excess of what the court could have imposed by injunction.
See Citizens fo r a Better Env’t, 781 F.2d at 1124-27. The court also rejected
the contention that the Article III limits on judicial power established in Vermont
Yankee (435 U.S. 519 (1978)) prevented the district court from entering a decree
that committed the EPA to undertake regulatory steps that “ go beyond statutory
requirements.” Citizens fo r a Better Env’t, 718 F.2d at 1125. The court explained
that “ [t]he Decree here was largely the work of the EPA and the other parties
to these suits, not the district court; manifestly the requirements imposed by the
Decree do not represent judicial intrusion into the Agency’s affairs to the same
extent they would if the Decree were ‘a creature of judicial cloth.’ ” Id. at 1128(quoting Weinberger v. Catholic Action of Hawaii/Peace Educ. Project, 454 U.S.
139, 141 (1981)). It further explained that
[s]ince the solution arrived at was to a considerable extent the work
of the Agency itself, and since the district court’s role was confined
to approving the fairness of the consent decree which incorporates
it and ensuring the consistency of the Decree with the Act, Vermont
Yankee’s concern for ‘judicially-conceived notions of administrative
fair play’ is inapposite here.
Citizens fo r a Better Env’t, 718 F.2d at 1128; see Costle Memo at 5-6.
The court of appeals next turned to the question whether statutory provisions
that restricted agency authority barred the EPA from binding its discretion in the
manner required by the decree. The court noted that the decree imposed only
a “ limited infringement on the Agency’s discretion,” Citizens fo r a Better Env’t,
718 F.2d at 1129-30, because “ it requires EPA to begin the process of formu­
lating regulations in compliance with the Act and describes a methodology to
be followed by the Agency, but it leaves the outcome of the process (the sub­
stantive regulations) to the Agency’s discretion.” Id. at 1129 n.14. Moreover, it
concluded that Congress had impliedly sanctioned this limited, voluntarily-adopted
restriction on agency discretion when it amended the CWA in a manner that pre­
served the decree. Id. at 1130.
In so analyzing the issues, the majority impliedly rejected the dissent’s constitu­
tional arguments against the decree. The dissent contended that the decree violated
the constitutional separation of powers because it permitted an Article III court
to require an executive branch agency to “ exercise its administrative discretion
in a particular way.” Id. at 1131 (Wilkey, J., dissenting). As a result, the dissent
concluded that it was of no consequence that the decree purported to restrict the
EPA’s discretion only with respect to preliminary procedural decisions, as opposed
166
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
to final substantive rules. Any judicially imposed limitation on executive discre­
tion, the dissent contended, was unconstitutional. Moreover, the dissent contended,
the decree was particularly problematic because it purported to constrain the
discretion of subsequent administrations. In this respect, the dissent argued, the
decree could not be said to constitute a voluntary limitation on executive discre­
tion. Rather, the discretion of subsequent administrations would be involuntarily
constrained by judicial order.
The majority adopted a contrary premise. It held that Congress may authorize
executive branch agencies to divest themselves of the statutorily conferred discre­
tion that they would otherwise have been entitled to exercise, and thus to bind
themselves to comply with voluntarily-adopted, judicially enforceable commit­
ments that Congress had not mandated. As we have explained above, our analysis
of the constitutional limitations on executive branch settlements that limit congres­
sionally conferred executive branch discretion accords with this holding.
Moreover, although the court of appeals emphasized the distinction between
an agency’s commitment to undertake certain preliminary procedures in formu­
lating rules and an agency’s commitment to reach certain “ substantive outcomes”
in final regulations, it did not suggest that such a distinction was necessarily of
constitutional significance. It simply concluded that this distinction was relevant
to a determination whether Congress had intended to permit the EPA to settle
on terms that would limit the exercise of its discretion. Citizens for a Better Env ’t,
718 F.2d at 1126. Again, we believe this analysis to be correct, and, indeed, the
distinction drawn by the court accords with our conclusion that a settlement that
would commit an agency to promulgate substantive regulations of the kind ordi­
narily subject to the notice and comment requirements of the APA would likely
be prohibited by the APA.
The Constitution does not generally prohibit Congress from authorizing the
Attorney General to enter into a settlement that binds an agency to adopt regula­
tions, whether they are substantive or procedural in nature, but there are neverthe­
less sound reasons to conclude that an agency’s commitment regarding procedural
rules is more likely to have been authorized by Congress than an agency’s
commitment regarding certain substantive regulatory outcomes. See Costle Memo
at 5. Similarly, agency commitments of shorter duration are less likely to press
the limits of congressional authorization than agency commitments of longer dura­
tion. As Professor Shane explains:
[A] promise to maintain a rule in place for ten years absent
“ exigent circumstances” or a “ national emergency” would appear
such a bizarre departure from ordinary administrative procedure —
a procedure that Congress has never adopted for any regulation
whatsoever — that authority to make such a promise could not
167
Opinions of the Office o f Legal Counsel in Volume 23
reasonably be implied merely from a general authorizing statute and
the Attorney General’s broad authority to conduct litigation.
Shane, supra at 255; see also Bowen v. Georgetown University Hosp., 488 U.S.
204, 224 (1988) (agency must be expressly authorized to engage in “ extraor­
dinary’’ exercise of retroactive rulemaking).
In addition, in individual cases, the distinction between preliminary procedural
regulations and final substantive rules may be relevant to due process limitations
on agency rulemaking power, see Environmental Defense Fund, 636 F.2d at 1257,
or concerns regarding the executive’s ability to carry out its constitutionally
assigned functions. Cf. The Constitutional Separation o f Powers, 20 Op. O.L.C.
at 176-77. In accord with basic principles of statutory construction, therefore,
these constitutional concerns may justify the conclusion that, in some instances,
the ordinary presumption in favor of the Attorney General’s settlement power
should give way to the countervailing principle that statutes should be construed
to avoid serious constitutional concerns.
The central point is that federal law restrictions on the scope of settlements
that purport to constrain agency rulemaking authority— both procedural and sub­
stantive — are primarily rooted in legislative intent, rather than constitutional rule.
General presumptions regarding legislative intent may provide a basis for con­
cluding that an agency has broader settlement discretion with respect to its proce­
dures than its substantive regulatory decisions, and these presumptions may be
traceable to underlying constitutional principles. In the end, however, it is legisla­
tive intent that will, within the broad constitutional limits discussed above, deter­
mine the scope of an agency’s discretion to circumscribe the exercise of its statu­
torily-conferred regulatory authority.
Similar issues regarding the limits that federal law places on settlements that
purport to restrict the regulatory discretion of executive branch agencies arise out­
side the specific context of the rulemaking process. For example, settlements may
purport to restrict the enforcement discretion of executive branch agencies. The
proper analysis is essentially the same as applies to settlements that limit rule-
making discretion.
In Schering Corp. v. Heckler, 779 F.2d 683 (D.C. Cir. 1985), for example, the
United States Court of Appeals for the District of Columbia Circuit considered
a suit in which a drug manufacturer sought to invalidate a settlement agreement
between a competing drug manufacturer and the Food and Drug Administration
(“ FDA” ). The settlement would have prohibited the FDA from undertaking cer­
tain enforcement activities for 18 months. The settlement concluded litigation that
arose after the FDA had seized a drug that it had claimed was unapproved because
it was “ new” within the meaning of the relevant statutory framework. The drug
manufacturer then brought a declaratory judgment action contending that the drug
was not “ new,” and the FDA counterclaimed. In return for the dismissal of the
168
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
declaratory judgment action, the FDA agreed not to pursue enforcement activities
against the manufacturer with respect to the drug in question for 18 months. The
competing drug manufacturer contended that the settlement agreement amounted
to an abdication of the FDA’s statutory enforcement obligations.
In rejecting the competing drug manufacturer’s claim, the court of appeals
explained that the agency had harbored doubts about the status of the drug in
question and wished to avoid having the status of the drug determined in a judicial
rather than an administrative proceeding. ‘‘This was precisely the sort of balancing
of agency priorities and objectives, informed by judgments on agency expertise,
that, absent some ‘law to apply,’ should not be second-guessed by a court.” 779
F.2d at 686. The fact that the agency had agreed to bind the exercise of its enforce­
ment discretion for 18 months did not change the analysis. It simply represented
“ the quid pro quo that the agency found necessary to procure [the plaintiffs]
abandonment of its declaratory judgment action. We can no sooner question the
soundness of this bargain than we could a unilateral agency decision not to pros­
ecute ab ibnitio . . . Id.20 Thus, as in Citizens for a Better Environment, the
court of appeals considered the question as one that turned on congressional intent,
rather than constitutional restrictions on the power of the executive branch to limit
its discretion to enforce congressional statutes.
C. Promises to Divest Discretion
The Meese policy states that a “ department or agency should not enter into
a consent decree that divests the Secretary or agency administrator, or his succes­
sors, of discretion committed to him by Congress or the Constitution where such
discretionary power was granted to respond to changing circumstances, to make
policy, or managerial choices, or to protect the rights of third parties.” See Meese
Policy at 3. The Meese policy also states that
in any settlement agreement in which the Secretary or agency
administrator agrees to exercise his discretion in a particular way,
where such discretionary power was committed to him by Congress
or the Constitution to respond to changing circumstances, to make
policy or managerial choices, or to protect the rights of third parties,
the sole remedy for the department or agency’s failure to comply
with those terms of the settlement agreement should be the revival
of the suit.21
20 The court noted that because the agency had restricted its enforcement discretion only for a limited penod
of time, see Schering, 779 F.2d at 685-86, and had not finally concluded that the drug was “ new,” id. at 685
n 18, there was no question that the agency “ has implemented a policy or pattern of nonenforcement that amounts
to ‘an abdication of its statutory responsibilities^]’ " I d at 686
21 Again, the Meese policy’s distinction between the rules that should apply to consent decrees as opposed to
settlement agreements is not mandated by federal law
169
Opinions o f the Office o f Legal Counsel in Volume 23
Id.To the extent that this final limit on the Attorney General’s settlement power
simply requires executive officials to exercise the discretion that they are required
by law to retain, it is unremarkable. As we have explained, when Congress man­
dates that the executive branch retain discretion over certain questions, the execu­
tive branch generally has no authority to divest itself of that discretion. See Costle
Memo at 5-6. Similarly, when the Constitution vests a discretionary power in
the President, such as the power to make recommendations to Congress, the
Attorney General may not enter into settlements that divest the President of that
constitutionally committed discretion. Absent that constitutional requirement, how­
ever, the Attorney General’s settlement discretion turns largely on whether Con­
gress has authorized the limitation on administrative discretion proposed in the
settlement.
With respect to the effect of settlements on the rights of third parties, there
is no general constitutional limitation on discretion-limiting settlements even
though such settlements may have consequences for persons or entities not party
to the settlements and even though the settlement may therefore constrain the
executive branch’s capacity to take account of the interests of non-parties in the
future. To the extent that a settlement would infringe a legal right of a third party,
whether statutory or constitutional, however, the settlement would likely be unlaw­
ful as an initial matter, wholly apart from the question whether it may be subject
to collateral attack. See Local 93, Int’l A ss’n of Firefighters, 478 U.S. at 526(explaining that consent decree mandating affirmative action plan would have to
conform to the Equal Protection Clause); Martin v. Wilks, 490 U.S. 755, 762
(1989) (holding, in connection with challenge to consent decree implementing
affirmative action program, that “ [a] judgment or decree among parties to a law­
suit resolves issues as among them, but it does not conclude the rights of strangers
to those proceedings” ). Finally, general statutory provisions such as the Adminis­
trative Procedure Act may limit the manner in which agencies may adopt certain
regulations that would affect the interests of third parties, by, for example,
requiring that such regulations be adopted only after notice and an opportunity
for comment by interested parties has been provided. These statutory limitations
may therefore constrain the exercise of the settlement power in a manner that
is protective of third parties.
V. Conclusion
In general, the Attorney General is free to enter into settlements that would
limit the future exercise of executive branch discretion that has been conferred
pursuant to statute. Such settlements must be consistent, however, with statutory
provisions that directly limit the Attorney General’s settlement power as well as
statutory limitations that constrain the authority of the executive branch agencies
170
Authority to Enter Settlements Limiting the Future Exercise o f Executive Branch Discretion
on behalf of which the settlement is entered. The Constitution may bar settlements
limiting the exercise of statutorily conferred discretion in extraordinary cir­
cumstances, and Article III may render certain types of promises contained in
such settlements unenforceable, but neither Article II nor Article III should be
understood to impose substantial impediments to the generally broad power of
the Attorney General to exercise the settlement discretion that Congress has
authorized her to exercise. Article HI does not preclude her from settling simply
because a court could not have imposed similar discretion-limiting terms by an
ordinary injunction. On the other hand, with respect to settlements that would
limit the future exercise of discretion that has been conferred upon the executive
branch directly by the Constitution, such as the discretion that is conferred upon
the President by the Pardon Power or the Recommendations Clause, the scope
of the Attorney General’s settlement power is constrained by the very constitu­
tional provisions that vest discretionary authority in the President and therefore
necessarily preclude the President from subjecting the exercise of that discretion
to the control of the other party to a settlement or to judicial enforcement.
RANDOLPH D. MOSS
Acting Assistant Attorney General
Office o f Legal Counsel
171