Third Cir. Focuses on ‘Public Rights’ in DOL Judges Dispute (1)

A Third Circuit panel zeroed in Thursday on whether enforcement of a seasonal work visa program falls under an exception to a US Supreme Court ruling limiting the power of agency judges to impose monetary penalties.

The case brought by a New Jersey farm tests the constitutionality of the administrative law judge system at the US Labor Department, one of several agencies defending their in-house jurists from legal attacks by employers like SpaceX and Walmart Inc.

Sun Valley Orchards LLC seek to overturn half a million in fines over violations in the H-2A agricultural visa program. It argues that the Supreme Court’s 2024 ruling in SEC v Jarkesy requires that those penalties could only be enforced in a federal trial court, not in an internal agency system.

Justices in the decision found, however, that matters of public rights—including immigration—can be adjudicated within the executive branch. Judge D. Brooks Smith, a George H.W. Bush appointee, asked during oral arguments in Pittsburgh whether the decision provides a simple road map for resolving the appeal.

“If so, in looking at this road map, do we reach a crossroads which requires us to decide whether an action was fundamentally about immigration, which may suggest that it implicated public rights, or was fundamentally a labor dispute, which would suggest it implicated private rights?” he said.

Rob Johnson, senior attorney at the libertarian group Institute for Justice and counsel for Sun Valley, told the panel that the exception didn’t apply in this case because the penalties were assessed for violations after workers moved across the border.

“What the court said is that these public right exceptions have to have some limiting principle,” he said.

The public rights exception would be relevant if the government was seeking to debar Sun Valley from the H-2A program, “but the government’s not seeking that remedy,” Johnson said.

However, Justice Department attorney Daniel Aguilar, representing the DOL, said but for the visa program, the workers would never be present in the US.

“That’s how the H-2A program works right? If there’s a determination that there are insufficient amount of domestic workers to perform the temporary agricultural work, the employer purposefully goes to the federal government and says, I would like to import foreign laborers here for a particular time,” he said.

Removal Protections

A district court judge in 2023 dismissed the Sun Valley challenge, finding that enforcement of H-2A violations could be handled outside of federal courts under Supreme Court precedent. That temporary visa program allows agricultural employers to hire foreign workers on a seasonal basis when there aren’t adequate numbers of US workers available.

Not addressed in the hearing Thursday were arguments over the constitutionality of removal restrictions for administrative law judges.

Sun Valley made those restrictions part of the basis of its appeal last year. The Labor Department countered that the company failed to raise that argument during enforcement proceedings and cannot now press it.

Top DOJ leadership, however, released a statement earlier this year taking the position that those removal protections were unconstitutional and promising to restore accountability to the executive branch.

The case was also heard by heard by Circuit Judges Thomas Hardiman, also a George H.W. Bush appointee, and David J. Porter, a Trump appointee.

The case is Sun Valley Orchards LLC v. DOL, 3d Cir., No. 23-02608, oral arguments 4/10/25.