Judge Rebukes Feds For Destroying Family Farm Over ‘Paperwork Violation’

Eight years after Alex Acosta’s nomination for secretary of labor revived scrutiny of the notorious plea bargain he gave convicted sex offender Jeffrey Epstein, setting up the successful prosecution of the late financier, the Labor Department got another black eye for allegedly abusing its authority across three presidential administrations.

The 3rd U.S. Circuit Court of Appeals stripped the department’s authority to seek civil penalties against enforcement targets within its own administrative courts, ruling in favor of a now-shuttered New Jersey family farm that lost five years of internal challenges before the Institute for Justice sued the department on behalf of Sun Valley Orchards in 2021.

It follows a 5th Circuit April ruling vacating a Federal Communications Commission administrative court’s $57 million fine against AT&T for allegedly mishandling customer data, initiated by the first Trump administration and upheld by President Biden’s FCC.

Both are based on the Supreme Court’s June 2024 precedent against substituting in-house agency courts for real courts in a 7th Amendment case against the Securities and Exchange Commission by hedge fund manager George Jarkesy, which along with the same week’s Loper Bright precedent reasserted judicial authority over agency decisions.

The ruling means “the days of the Department of Labor imposing liability through its own in-house courts are over,” IJ Senior Attorney Rob Johnson said. The department seized $4.9 million in back wages and $5.8 million in penalties on agricultural employers last year under the statutes used against Sun Valley.