To amend title 5, United States Code, to provide that judicial review under the Administrative Procedure Act requires de novo trial of the facts when agency action seeks a sanction.

Key Points

• This bill changes how federal courts review agency actions that impose penalties. Currently, courts generally defer to the facts as found by the agency. This bill would require courts to decide questions of fact independently, conducting a fresh review rather than relying on the agency's record.
• The bill specifically targets agency sanctions, meaning fines, penalties, or other punishments that agencies impose on people or businesses. When an agency seeks a sanction, the reviewing court would conduct a de novo (from scratch) trial of the facts instead of deferring to the agency's findings.
• The bill also broadens the scope of what courts can review by covering the results of both rulemaking and adjudication procedures. This means courts would look freshly at facts underlying rules made under Section 553 and decisions made under Section 554 of the Administrative Procedure Act.
• If enacted, this would represent a major shift in the balance of power between federal agencies and the courts. Agencies like the SEC, EPA, and FTC that regularly impose fines and penalties would face much higher legal hurdles, since they could no longer rely on courts deferring to their factual findings.

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