ILMA Compoundings - November/December 2020 - 35

particularly the EPA, require a target
of an investigation or an enforcement
action to " prove the negative " to avoid
liability and the imposition of civil penalties. This, in my opinion, is an unfair
burden. The memo seeks to ensure that
the particular agency instead bears the
burden of proving alleged violations
of the laws or regulations it enforces,
in part, by advising the agency to
consider applying " the rule of lenity " to
administrative investigations, enforcement actions and adjudication. This
rule effectively gives the benefit of the
doubt to the target or respondent from
ambiguous or conflicting statutes or
regulations. The memo advises agencies
to conform civil adjudicatory evidence
disclosures to the Department of Justice's policy in criminal cases of timely
disclosure of exculpatory evidence
and evidence relevant to mitigating
damages or penalties.
Similarly, in cases to be brought
before administrative law judges, the
memo wants agencies to follow the
Federal Rules of Evidence, including
reducing the use of hearsay evidence
and applying the Daubert framework
established by the U.S. Supreme
Court to assess the veracity of scientific evidence and expert opinion.
Turning to agency accountability and
transparency, the memo limits the
use of tolling agreements by directing
agencies to seek approval from an

" Officer of the United States " prior to
entering into tolling agreements to
extend the statute of limitations for an
alleged violation. The " Officers " who
can provide such approval include
cabinet secretaries or federal judges
confirmed by the Senate.
One of the memo's directives
encourages agencies to apply " limiting principles to the duration of
investigations " - that is, requiring
an investigation to end with either a
staff recommendation to commence
an enforcement action or to close the
investigation, all " within a defined
time period. " The memo discourages
agencies from selecting investigation or
enforcement targets based on retaliatory
or punitive motives. The memo also
emphasizes that " an agency should have
only one bite at the apple to investigate
and seek enforcement " based on a fact
pattern that is " not a continuing or
expanding violation. " OIRA cautions
agencies from using performance
evaluation metrics for enforcement
employees that reward or incentivize
" meritless or unwarranted " actions.
One of the memo's provisions I
like is the directive to agencies, when
considering civil penalties, that they are
encouraged to establish enforcement
discretion policies that consider a
regulated party's good-faith attempts
to comply. Agencies are instructed
to " make the public aware of the

conditions in which investigations and
enforcement actions will be brought "
and the nature of the penalties that will
be " sought for common infractions. "
Lastly, the memo directs that all
consent orders and settlements should
contain expiration dates and/or termination criteria that are proportional to
the violation being remedied, and that
parties to such agreements should not
be prevented from discussing their cases.
As I noted at the outset, the memo's
best practices and recommendations
must be formally incorporated into
each agency's administrative practices
through notice-and-comment rulemaking. OIRA told agencies that they need
to issue proposed rules by Nov. 26.
Hopefully, as different agencies propose
rules to be consistent with the memo,
ILMA will review and, if appropriate,
submit comments. While perhaps
more exciting to me as a lawyer who
defends companies and persons before
federal agencies, unless and until the
memo is withdrawn, the directives will
enable regulated entities to achieve
more favorable enforcement outcomes.
My best for a safe and healthy
holiday season.
Leiter serves as general
counsel to ILMA, representing
the Association since 1981.
He may be reached at
202-466-6502 or jleiter@bmalaw.net.

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ILMA Compoundings - November/December 2020

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