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Regulating by Example

51 Pages Posted: 15 Feb 2017 Last revised: 5 Aug 2017

Susan C. Morse

University of Texas at Austin - School of Law

Leigh Osofsky

University of Miami - School of Law

Date Written: February 15, 2017

Abstract

Agency regulations are full of examples. Regulated parties and their advisors parse the examples to develop an understanding of the applicable law and to determine how to conduct their affairs. However, the theoretical literature contains no study of regulatory examples or of how they might be interpreted. Courts differ about whether examples serve as an independent source of law. There is uncertainty about the proper role of this frequently used regulatory tool.

In this Article, we argue that regulatory examples make law. Our claim is that, as a default rule, the legal content offered by regulatory examples is co-equal with, not subordinate to, the non-example portions of regulations. Treating examples as co-equal empowers agencies to improve regulatory content through concrete communication, while also acknowledging regulated parties’ natural inclination to treat such communications as law. We reject counterarguments that regulatory examples merit extra scrutiny, or less respect, that would relegate them to second-class status.

We also set forth a method for interpreting regulatory examples. We argue that they are best understood through analogical, or common law, reasoning, and we illustrate this approach. We show how analogical reasoning can be reconciled with the rest of the broader regulatory and statutory scheme using various interpretive approaches such as textualism or purposivism. Our method places regulatory examples in dialogue with their broader regulatory and statutory schemes. It both empowers and constrains courts, agencies, and regulated parties in their efforts to understand the meaning of regulations.

Keywords: Regulation, Agencies, Law

Suggested Citation

Morse, Susan C. and Osofsky, Leigh, Regulating by Example (February 15, 2017). Yale Journal on Regulation, Vol. 35, No. 1, 2017; University of Miami Legal Studies Research Paper No. 17-3; U of Texas Law, Public Law Research Paper No. 661. Available at SSRN: https://ssrn.com/abstract=2916883 or http://dx.doi.org/10.2139/ssrn.2916883

Susan C. Morse

University of Texas at Austin - School of Law ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States

Leigh Osofsky (Contact Author)

University of Miami - School of Law ( email )

P.O. Box 248087
Coral Gables, FL 33146
United States

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