ILNews

Legislative group delays action on ALJ panels to retain subject-matter expertise

Back to TopCommentsE-mailPrintBookmark and Share

Hendricks Superior Judge Bob Freese remembers a case from his practice days where he represented a client before a federal administrative law judge applying the rules of the National Transportation Safety Board. His impression of that experience: “This is a railroading.”

freese-robert-mug Freese

The hearing officer in that case “might as well have been prosecuting the case” for the government, Freese told the General Assembly’s Interim Study Committee on Corrections and Criminal Code, of which he’s a member, at a meeting last month.

Perceived bias of administrative law judges in favor of the state agencies for which they adjudicate disputes has led to calls for Indiana to join 30 other states that have moved to central panels of ALJs to give them more independence. But that won’t happen anytime soon.alj_numbers.gif

The committee on Oct. 13 rendered its final report, punting the issue to the next administration to continue studying creation of a pool of ALJs separated from the agencies for which they adjudicate disputes.

“It’s indefensible if we sit here and think it’s not, on the face of it, a problem that (an ALJ) or hearing officer is an employee or contract employee of the agency,” said Rep. Greg Steuerwald, R-Danville, as the committee finished its business. “It is ridiculous. … I can’t tell you how adamant I am that this is a problem, and if we don’t deal with it, shame on us.”

Washburne Washburne

Committee chairman Sen. Tom Washburne, R-Evansville, wrote in a final report that “there does exist at least perceived unfairness” in the system that should be revisited by the next governor. But he also said there was persuasive testimony that ALJs who hear highly technical environmental and utility regulatory agency matters, for instance, should be retained. He also said various agencies heard disputes within timeframes dictated by state and federal law and untangling these poses more challenges than the committee was prepared to undertake.

“This is a big honking project,” he said.

The final report came after representatives of the Indiana Utility Regulatory Commission, Department of Workforce Development and Department of Child Services testified that panels could strain the ability of those agencies to meet deadlines and rule on matters with the sufficient level of subject-matter expertise.

“Technical expertise, we think, could be lost and jeopardized if we moved to an administrative court system,” testified Tim Rushenberg, vice president of the utility trade group Indiana Energy Association.

A survey of agencies that use ALJs produced mixed responses. Of 23 agencies that responded, more than half provided no response or expressed no opinion about whether they favored creation of central panels in Indiana.

Steuerwald Steuerwald

But among agencies that provided an opinion, by a 2-1 margin, respondents agreed with the statement “Independent panels allow ALJs to be free of interference from state agencies for which they work.”

Bose McKinney & Evans LLP partner Nikki Shoultz testified last month that the more than 200 utility lawyers in the Indiana State Bar Association unanimously favor excluding the IURC from proposed ALJ panels. For most, the sentiment is, “If it ain’t broke, don’t fix it.”

The rate-setting agency reviews combine elements of engineering, accounting and finance, she said, and even after years practicing in this area, she’s always learning something new. “For me, it’s close to rocket science,” she said.

Likewise, Bose partner Daniel McInerny said agency reviews of environmental decisions were enacted because trial courts lacked the expertise, particularly in Indiana Department of Environmental Management matters, and environmental lawyers favor keeping the current system. “If this is to be considered, we think the idea of expertise needs to be preserved,” he said. “In the area of environmental law, we like the way it’s working right now.”

But other lawyers said the system is in dire need of reform. Solo practitioner Linda B. Klain said she believed subject matter expertise could be retained if the state switched to ALJ panels.admin-map

“There is an appearance of bias, and I would venture to say there is actual bias,” said Klain, who has represented parties in appeals of health agency rulings, and has served as an ALJ. She said ALJs in some agencies feel an expectation of how they should apply the law from the same department heads who evaluate them. She cited this as a reason why she quit serving as a contracted ALJ.

Klain also said creating central panels of ALJs removed from agency oversight would improve efficiency, enhance independence and allow ALJs to share best practices, experience and expertise.

Like Klain, Quarles & Brady LLP partner Randall R. Fearnow represents health care providers before various state agencies. He told the committee that in 25 years of practice, he could count on one hand the number of times his client prevailed before an Indiana ALJ. He said he routinely advises clients to prepare to try their case before the ALJ, lose, and then be prepared retry the case in court. He said this structure means only clients who can afford to finance an appeal of an adverse agency decision do so.

Fearnow called Indiana’s current ALJ structure an “expensive, cumbersome, and ultimately futile system.”

In some cases, he said a Department of Health employee who represented a state agency in one matter later appeared as an administrative law judge in another involving his clients. Such a system produces arbitrary results at best, he said, and “breeds disrespect for the rule of law. … There is no way this process can be made to appear fair.”

The way Indiana agencies use ALJs varies, and some refer to them as hearing officers rather than ALJs. Legislative Services Agency senior fiscal analyst Mark Goodpaster shared study results that show 36 agencies employ some kind of ALJ or hearing officer to adjudicate disputes, but 12 agencies have 10 or fewer such cases a year. Many of these are handled by deputy attorneys general.

Assistant attorney general David Miller said just 81 percent of cases heard by the office’s ALJs resulted in a win for the state, citing this as an example of fairness. Sen. Greg Taylor, D-Indianapolis, wasn’t swayed.

“Anyone who’s successful 81 percent of the time is usually in the hall of fame,” Taylor quipped at a hearing last month.•

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. File under the Sociology of Hoosier Discipline ... “We will be answering the complaint in due course and defending against the commission’s allegations,” said Indianapolis attorney Don Lundberg, who’s representing Hudson in her disciplinary case. FOR THOSE WHO DO NOT KNOW ... Lundberg ran the statist attorney disciplinary machinery in Indy for decades, and is now the "go to guy" for those who can afford him .... the ultimate insider for the well-to-do and/or connected who find themselves in the crosshairs. It would appear that this former prosecutor knows how the game is played in Circle City ... and is sacrificing accordingly. See more on that here ... http://www.theindianalawyer.com/supreme-court-reprimands-attorney-for-falsifying-hours-worked/PARAMS/article/43757 Legal sociologists could have a field day here ... I wonder why such things are never studied? Is a sacrifice to the well connected former regulators a de facto bribe? Such questions, if probed, could bring about a more just world, a more equal playing field, less Stalinist governance. All of the things that our preambles tell us to value could be advanced if only sunshine reached into such dark worlds. As a great jurist once wrote: "Publicity is justly commended as a remedy for social and industrial diseases. Sunlight is said to be the best of disinfectants; electric light the most efficient policeman." Other People's Money—and How Bankers Use It (1914). Ah, but I am certifiable, according to the Indiana authorities, according to the ISC it can be read, for believing such trite things and for advancing such unwanted thoughts. As a great albeit fictional and broken resistance leaders once wrote: "I am the dead." Winston Smith Let us all be dead to the idea of maintaining a patently unjust legal order.

  2. The Department of Education still has over $100 million of ITT Education Services money in the form of $100+ million Letters of Credit. That money was supposed to be used by The DOE to help students. The DOE did nothing to help students. The DOE essentially stole the money from ITT Tech and still has the money. The trustee should be going after the DOE to get the money back for people who are owed that money, including shareholders.

  3. Do you know who the sponsor of the last-minute amendment was?

  4. Law firms of over 50 don't deliver good value, thats what this survey really tells you. Anybody that has seen what they bill for compared to what they deliver knows that already, however.

  5. As one of the many consumers affected by this breach, I found my bank data had been lifted and used to buy over $200 of various merchandise in New York. I did a pretty good job of tracing the purchases to stores around a college campus just from the info on my bank statement. Hm. Mr. Hill, I would like my $200 back! It doesn't belong to the state, in my opinion. Give it back to the consumers affected. I had to freeze my credit and take out data protection, order a new debit card and wait until it arrived. I deserve something for my trouble!

ADVERTISEMENT