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Chapter 5: Apply: Brief Hypotheticals 5.1

1) BP violated the Clean Air Act by discharging pollutants from one of its refineries and was unable to reach a settlement with the EPA regarding a violation of the law. The EPA plans to go forward with a trial on this matter which will be heard by

a. an administrative law judge.
b. the Supreme Court.
c. a county court judge.
d. an appellate court judge.

2) Congress passed the Securities Exchange Act of 1934, which created the Securities Exchange Commission. This legislation, which created an independent regulatory agency, is known as

a. common law.
b. enabling legislation.
c. administrative law.
d. a Congressional act.

3) The Environmental Protection Agency conducts meetings to discuss the possibility of creating additional regulations within the next five years. Under the Government in the Sunshine Act, the meetings

a. must be advertised, so that the public is aware that the meetings are taking place, but may be conducted privately.
b. may be closed to the public.
c. must be conducted in the open.
d. may be closed to the public, but the minutes of the meetings must be posted on the agency’s Web site.

4) UsAgainstThem, a nonprofit environmental group, is contesting the EPA’s interpretation of a rule that has allowed a refinery to offset an increase in emissions relating to one part of the refinery by reducing emissions in another part of the refinery. In challenging the EPA’s interpretation, a court will likely

a. refer the matter to an agency sub-committee.
b. seek advice from Congress.
c. defer to the agency’s interpretation.
d. dismiss the suit for lack of standing.

5) AT&T wants to obtain additional rights to operate within the 700 MHz spectrum in the U.S. The Federal Communications Commission (FCC) has rules and regulations that govern wireless spectrum auction. The FCC is

a. a legislative agency.
b. an administrative agency.
c. an executive agency.
d. a judicial agency.

6) The Food and Drug Administration (FDA) is investigating a report that Cherise Cosmetics Co. is in violation of purity and testing regulations. The FDA wants Yasmin, the lead chemist for the company, to testify at an administrative hearing. Yasmin refuses, so the FDA

a. issues an ordinary subpoena.
b. appeals her decision to a federal court.
c. conducts an on-site investigation to discover the information.
d. issues a subpoena duces tecum.

7) Theo is injured at work and files a workers’ compensation claim, which is administered by the workers’ compensation agency in his state. His employer disputes the extent of Theo’s injuries. The case is heard by an administrative law judge (ALJ), who decides the case in the employer’s favor. Theo’s attorney tells him that his case cannot be appealed to a court because

a. the decision of the ALJ is final in all administrative challenges.
b. there is not an actual controversy that qualifies for judicial proceedings.
c. he does not have standing to appeal an administrative decision, only the employer could do that.
d. he has not first appealed the case to the workers’ compensation board that heads the state agency.

8) William wants to obtain information from the Securities and Exchange Commission regarding the number of active cases related to insider trading. To request this information, he would need to fill which of the following with the SEC:

a. a Sunshine Act request.
b. a Regulatory Flexibility Act request.
c. a Freedom of Information Act request.
d. an SEC disclosure request.

9) The EPA passes a proposed a rule change to the Clean Air Act related to the discharge of emissions by factories. The EPA’s action would be considered arbitrary and capricious for all of the following reasons except:

a. it changed a prior policy without justification.
b. it failed to provide the required time for notice and comment.
c. it failed to provide a rational explanation for its decision.
d. it considered legally inappropriate factors

10) The Securities and Exchange Commission (SEC) charges the Able Baker Co. (ABC) with violating an administrative rule regarding the sale of securities. ABC did not realize that in its search for capital it became subject to securities regulation. ABC may attempt to settle the case rather than proceed to litigation, because

a. a settlement can be more complex than litigation.
b. a settlement is less costly than litigation.
c. it does not want to cooperate with the SEC.
d. a settlement will be more costly for the agency.

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