Feds Dinged for Exchange Program Sanctions

PASADENA, Calif. (CN) - The State Department did not provide adequate procedural protections when it imposed sanctions against a sponsor of the Exchange Visitor Program, the Ninth Circuit ruled Friday.

The program allows foreign nationals to participate in temporary cultural and educational exchange programs in the United States.

After a Japanese participant, Noriko Amari, lodged a complaint about her training conditions at a restaurant called The Cream Pot, a Hawaiian host organization, the State Department imposed sanctions against program sponsor ASSE International.

According to the circuit's 35-page opinion, Amari alleged labor exploitation, excessive work hours, inadequate compensation and harassment.

The State Department sought an explanation from ASSE about Amari's claims and ASSE claimed that Amari did not respond to the sponsor's immediate attempts to communicate with her and offer assistance, according to the opinion.

State Department officials then began a review of ASSE's compliance with program regulations and found that sanctions were warranted because ASSE had not responded to Amari's complaints appropriately and had failed to ensure that she had a sufficient knowledge of English to participate in the program.

The sanctions included a written reprimand of ASSE, an order that the organization provide a corrective action plan and a 15 percent reduction in the number of trainees in its program.

ASSE sued the department, arguing the decision to impose sanctions violated the Administrative Procedure Act and the organization's due process rights. But a federal judge dismissed the complaint, finding that the statutes authorizing the program gave the department full discretion to implement it and that the process by which ASSE was sanctioned was "fundamentally fair."

The Ninth Circuit reversed the court's ruling.

Writing for the three-judge panel, Circuit Judge Jay Bybee first said that the circuit has the discretion to rule on the issue because "the department failed to rebut the strong presumption of judicial reviewability because its regulations provide a 'meaningful standard' by which we can review its exercise of discretion in sanctioning ASSE."

He also said that the appeals court has authority to measure the department's administration of the program against the department's own regulations because it can do so "without infringing any of the State Department's prerogatives under the statute."

And in response to the department's claim that the circuit is "treading in an area of executive action in which the courts have long been hesitant to intrude," Bybee said that "a weak connection to foreign policy is not enough to commit an agency action to the agency's discretion."

"In sum, the statute authorizing the Exchange Visitor Program only gives the State Department the absolute discretion to create or not to create exchange programs for foreign students, and that decision is not challenged here," he said.

Bybee then turned to ASSE's due process claim, which argued that the department's paper-hearing procedure was inadequate because it did not allow for an opportunity to confront evidence in a trial-type setting, and that even if that procedure were adequate it did not provide a sufficient summary of evidence against the organization.

The panel held that the Due Process Clause did not mandate a trial-type proceeding here, but it also held that the department "did not provide adequate procedural protections in this instance," since the department relied "almost exclusively" on Amari's testimony and provided its own summary of the testimony to ASSE rather than interview notes.

"Such evidence may have affected the department's decision as to the severity of the sanctions, or whether to even impose sanctions at all," Bybee said.

"Thus, the risk of an erroneous decision was heightened, and the State Department should have provided ASSE with complete interview notes so it would have an opportunity to rebut the details of the harassment."

Because ASSE did not have a "meaningful opportunity" to rebut significant portions of the evidence, Bybee said, the department did not afford it adequate procedural protections and the federal judge got the case wrong.

The panel remanded to the district court for further proceedings.

Neither side responded to request for comment on Friday morning.

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