No. 99-605
In the Supreme Court of the United States
WILLIAM THOMAS, ET AL., PETITIONERS
v.
NETWORK SOLUTIONS, INC., ET AL.
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENT
IN OPPOSITION
SETH P. WAXMAN
Solicitor General
Counsel of Record
DAVID W. OGDEN
Acting Assistant Attorney
General
WILLIAM KANTER
MARK W. PENNAK
Attorneys
Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217
QUESTIONS PRESENTED
1. Whether the court of appeals correctly held that certain fees charged
by respondent Network Solutions, Inc. for registration and renewal of Internet
domain names pursuant to a cooperative agreement between Network Solutions
and the National Science Foundation did not constitute unconstitutional,
unauthorized taxes once Congress explicitly ratified those fees and authorized
their collection.
2. Whether the court of appeals correctly held that the Independent Offices
Appropriations Act, 31 U.S.C. 9701, does not apply to fees charged by Network
Solutions for registration and renewal of Internet domain names.
In the Supreme Court of the United States
No. 99-605
WILLIAM THOMAS, ET AL., PETITIONERS
v.
NETWORK SOLUTIONS, INC., ET AL.
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENT
IN OPPOSITION
OPINIONS BELOW
The opinion of the court of appeals (Pet. App. 1a-24a) is reported at 176
F.3d 500. The initial opinion of the district court (Pet. App. 41a-78a)
is reported at 2 F. Supp. 2d 22. The district court's later order dismissing
petitioners' claims (Pet. App. 25a-40a) is unreported.
JURISDICTION
The judgment of the court of appeals was entered on May 14, 1999. The petition
for rehearing was denied on July 8, 1999 (Pet. App. 93a-94a, 94a-1 to 94a-22).
The petition for a writ of certiorari was filed on October 6, 1999. The
jurisdiction of this Court is invoked under 28 U.S.C. 1254(1).
STATEMENT
1. The federal respondent, National Science Foundation (NSF), provides federal
financial support for scientific research and science education programs
through cooperative agreements, grants, loans, and other forms of financial
assistance, 42 U.S.C. 1862(a)(1), but does not itself engage in scientific
operations, 42 U.S.C. 1873(b). Among other things, Congress has charged
the NSF with the mission of "foster[ing] and support[ing] the development
and use of computer and other scientific and engineering methods and technologies,
primarily for research and education in the sciences and engineering."
42 U.S.C. 1862(a)(4).
In that role, NSF support was instrumental in the development of a computer
network known as NSFNET,1 which provided a "backbone" that permitted
the networks of educational institutions, non-military government entities,
and commercial concerns involved in scientific research to be linked together.
NFSNET was eventually linked with other networks and, when limits on commercial
access to those networks were lifted (primarily after 1992), they coalesced
into the backbone of the modern Internet. See Improvement of Technical Management
of Internet Names and Addresses, 63 Fed. Reg. 8826 (1998); Pet. App. 7a
n.5.
Access to the Internet takes place through "host computers," each
with a unique numerical address (known as an Internet Protocol or IP number)
that allows other computers to identify and locate it. The assignment of
IP numbers was initially managed by the late Dr. Jon Postel working through
the Internet Assigned Numbers Authority (IANA) at the University of Southern
California. Pet. App. 3a-4a. Because IP numbers are complex and difficult
to remember, the Internet community also has developed a system that allows
Internet computers to be identified by unique, user-friendly alphanumeric
combinations, such as "IBM.com"; those user-friendly addresses
are known as "domain names." Various computers (domain name servers)
keep track of the domain names and the IP number to which each domain name
corresponds; they thus enable messages to be sent and received without the
end-user knowing the IP number. Id. at 4a. To ensure that each domain name
is associated with the proper IP number, and to ensure that each domain
name remains uniquely associated with that number, the Internet community
also has, by consensus, developed a registration system. That system was
not imposed by the federal government. See id. at 3a-4a, 7a.
2. Effective functioning of NSFNET (and other government-supported networks)
requires administrative support, including domain name registration. NSF
supported the provision of those services primarily through cooperative
agreements and grants with private sector entities.2 In March, 1992, NSF
issued a solicitation for proposals on a set of five-year cooperative agreements
involving the development and operation of network information systems for
NSFNET and a parallel scientific network, the National Research and Education
Network (NREN). C.A. App. 44. The solicitations specified that the awardee
would be required to operate the Internet domain name registration system
under policy statements issued by the IANA (a non-governmental organization)
and developed through a consensus-building procedure. Id. at 45.
In December, 1992, after an independent review of proposals responsive to
the NSF solicitation, NSF selected Network Solutions, Inc. (Network Solutions)
for the contract. Pet. App. 7a-8a. NSF and Network Solutions entered into
a cooperative agreement (the Cooperative Agreement) for domain name registration
for non-military users of the NSFNET and the NREN. (The Cooperative Agreement
is reproduced in Petitioner's Lodging Appendix 111a.) The Cooperative Agreement
provided for NSF support under a cost-plus-fixed-fee structure, but it also
contemplated that a structure based on user fees would be established in
the future. Pet. App. 8a.
The Cooperative Agreement, like all NSF assistance awards, was subject to
NSF's Grant General Conditions (Conditions), Article 1a of which clarified
that the development and operation of the registration of domain names (the
subject of the Cooperative Agreement) was not operated or regulated by NSF.
See Pet. App. 22a. Finally, the Agreement provided for a mid-term performance
review to be conducted by December 31, 1994, to determine whether to continue
NSF funding and to provide direction regarding the level of future support
for the duration of the Agreement. Cooperative Agreement Art. 5.B (Lodging
Appendix 117a).
The performance review was conducted by a diverse 16-member panel (the Panel)
representing the Internet community, none of whom was employed by, or represented
the interests of, NSF or Network Solutions. The Panel noted Network Solutions'
"excellent service in the face of exponential growth in demand,"
C.A. App. 415, but questioned Network Solutions' ability "to keep up
with the * * * exponential growth of the Internet," id. at 435. Accordingly,
the Panel recommended that more resources be allocated to help Network Solutions
"meet [the] increasing work load." Id. at 436. Specifically, the
Panel stated:
At present, the management of .COM [second-level domain names used by commercial
entities] is paid for by the NSF, and hence increasing demand for .COM registrations
will require increasing support from the NSF. The panel recommends that
[Network Solutions] begin charging for .COM domain name registrations and
later charge for name registrations in all domains.
Ibid.
Accordingly, after further negotiations, in September 1995, NSF and Network
Solutions amended the cooperative agreement to specify fees to be charged
for registration services, and provided rules concerning allocation of the
resulting revenues. In particular, the amendment provided:
a. 70% will be available to [Network Solutions] as consideration for the
services provided.
b. the remaining 30% will be placed into an interest-bearing account which
will be used for the preservation and enhancement of the "Intellectual
Infrastructure" of the Internet. [Network Solutions] will develop and
implement mechanisms to insure the involvement of the Internet communities
in determining and overseeing disbursements from this account.
Cooperative Agreement Art. 8a (as amended) (Lodging Appendix 133a). See
also Pet. App. 8a-9a.
During the appropriations process for fiscal year 1998, Congress directed
NSF to withdraw $23 million from the Intellectual Infrastructure Fund (the
Fund) contemplated by the amendment for use in supporting the "Next
Generation Internet" initiative. H.R. Rep. No. 297, 105th Cong., 1st
Sess. 134 (1997). The subject $23 million was later transferred to NSF's
appropriations, but none of it had been spent when the district court below
preliminarily enjoined NSF from spending any part of the Fund pending resolution
of the suit. See Pet. App. 79a. As explained in greater detail below, Congress
later specifically ratified and authorized the portion of the registration
fees collected for the Fund. See pp. 7-8, infra.
3. Petitioners filed this action in October, 1997, and an amended complaint
on January 30, 1998. The amended complaint asserted that the portion of
the domain name registration fee that Network Solutions was supposed to
deposit in the Intellectual Infrastructure Fund (30% of the registration
fee) constituted an unconstitutional tax under Article I, Section 8 of the
Constitution because Congress had not authorized its imposition (Counts
I and II). The amended complaint further alleged that the Independent Offices
Appropriations Act, 31 U.S.C. 9701, applied to the registration fee charged
by Network Solutions and rendered that fee unlawful insofar as it exceeded
Network Solutions' actual costs (Counts III and IV).3
On February 2, 1998, the district court enjoined all disbursements of monies
deposited into the Fund pending resolution of the lawsuit. Pet. App. 92a.
On April 6, 1998, the district court dismissed all claims against NSF and
Network Solutions except Count I. With respect to Count I, the district
court granted partial summary judgment as to liability in favor of petitioners.
The 30% portion of the fees collected by Network Solutions for deposit in
the Intellectual Infrastructure Fund, the district court concluded, constituted
a "tax." Because taxes may not be imposed without congressional
authorization, and because that authorization was lacking here, the district
court also concluded that the 30% portion of the fee was illegal under Article
I, Section 8 of the Constitution. Pet. App. 59a. Final judgment, the court
ruled, would await the adjudication of remedies. Id. at 62a-63a.
Shortly after the district court entered its April 6, 1998 order, the President
signed the 1998 Supplemental Appropriations and Rescissions Act, Pub. L.
No. 105-174, 112 Stat. 58. Section 8003 of that Act expressly authorized
and ratified the 30% portion of the fee invalidated by the district court.
In particular, it provided:
SEC. 8003. RATIFICATION OF INTERNET INTELLECTUAL INFRASTRUCTURE FEE. (a)
The 30 percent portion of the fee charged by Network Solutions, Inc. between
September 14, 1995 and March 31, 1998 for registration or renewal of an
Internet second-level domain name, which portion was to be expended for
the preservation and enhancement of the intellectual infrastructure of the
Internet under a cooperative agreement with the National Science Foundation,
and which portion was held to have been collected without authority in William
Thomas et al. v. Network Solutions, Inc. and National Science Foundation,
Civ. No. 97-2412, is hereby legalized and ratified and confirmed as fully
to all intents and purposes as if the same had, by prior Act of Congress,
been specifically authorized and directed.
(b) The National Science Foundation is authorized and directed to deposit
all money remaining in the Internet Intellectual Infrastructure Fund into
the Treasury and credit that amount to its Fiscal Year 1998 Research and
Related Activities appropriation to be available until expended for the
support of networking activities, including the Next Generation Internet.
112 Stat. 93 (Pet. App. 97a-98a).
On May 5, 1998, following enactment of Section 8003, NSF moved to dismiss
Count I of the Amended Complaint. Section 8003, NSF argued, authorized imposition
of the 30% portion of the fee challenged by petitioners; it therefore eliminated
any basis for petitioners' contention that the fee was unauthorized. Relying
on Section 8003, the district court agreed, granting NSF's motion and dismissing
the case in its entirety. Pet. App. 25a-40a.
4. Petitioners appealed, and the court of appeals affirmed. The court of
appeals first assumed, arguendo, that the 30% portion of the domain name
registration fee destined for the Intellectual Infrastructure Fund in fact
constituted an illegal tax, as the district court had held. The issue, the
court of appeals reasoned, was therefore whether or not Congress had the
power retroactively to ratify that "tax" through Section 8003.
Relying on this Court's decision in United States v. Heinszen & Co.,
206 U.S. 370 (1907), the court of appeals held that "Congress 'has
the power to ratify the acts which it might have authorized' in the first
place, so long as the ratification 'does not interfere with intervening
rights.'" Pet. App. 11a (quoting Heinszen, 206 U.S. at 384).
Applying Heinszen, the court of appeals held that Congress had intended,
through Section 8003, to ratify the 30% portion of the domain name registration
fee, Pet. App. 12a-14a, and that Congress had the power to do so, id. at
14a-15a. The court of appeals rejected petitioners' contention that Congress
could not have delegated to NSF the power to assess such a registration
fee. Petitioners' argument, the court of appeals explained, "miscasts
not only what Congress did, but also what Congress could have done initially."
Id. at 14a. As the court of appeals explained, Section 8003 did not purport
to delegate any authority or discretion to NSF for the simple reason that
the amount of the assessment had "already been set, the assessments
already collected." Ibid. Thus, the court reasoned, Section 8003 should
be construed simply as if "a prior act of Congress had directed NSF
to collect $30 for each new registration and $15 thereafter and to retain
the funds in order to support the Internet." Ibid. As the court concluded,
"we perceive no reason-registrants have offered none-why such legislation
would not have been within Congress's constitutional power under Article
I, § 8." Ibid.
The court of appeals likewise rejected petitioners' contention that the
70% of the registration fee retained by Network Solutions violates the Independent
Offices Appropriations Act, 31 U.S.C. 9701. As the court of appeals noted,
the IOAA requires that fees charged by agencies for agency services comport
with statutorily established criteria. Pet. App. 20a-21a. Yet, as the court
of appeals explained, the IOAA applies "only to 'a service or thing
of value provided by an agency.'" Pet. App. 22a (quoting 31 U.S.C.
9701(a)). In this case, the court of appeals reasoned, the registration
services for which the challenged fees were charged were not provided "by
an agency" but rather by Network Solutions, a private company. Pet.
App. 22a-23a.
The court of appeals further explained that a broader interpretation of
IOAA-one that encompasses all government services, whether actually provided
by the agency or by a private entity under contract with an agency-also
would not save petitioners' claim because registration of Internet domain
names is not a government service. Pet. App. 22a-23a. Noting that Congress
never required NSF or any other government agency to provide registration
services, the court ruled that the services hardly constitute "a 'quintessential'
government service." Id. at 23a. Finally, the court of appeals ruled
that IOAA also did not apply because "[t]he Act applies to monies bound
for the federal treasury." Ibid. As the court noted, the 70% portion
of the registration fee was paid to Network Solutions for its services and
was never (under the Cooperative Agreement or otherwise) bound for the federal
treasury.
ARGUMENT
The decision of the court of appeals is correct and does not conflict with
any decision of this Court or any other court of appeals. Further review
is therefore not warranted.
1. Petitioners first challenge the court of appeals' conclusion regarding
the effect of Section 8003 of the 1998 Supplemental Appropriations and Rescissions
Act, Pub. L. No. 105-174, 112 Stat. 93 (Pet. App. 97a-98a). In this Court,
petitioners do not dispute that Section 8003, by its express terms, purports
to ratify, legalize, and authorize imposition of the 30% portion of the
registration fee (for deposit in the Intellectual Infrastructure Fund) that
petitioners sought to invalidate. Rather, petitioners assert that Section
8003 cannot render that fee lawful because to do so would be inconsistent
with this Court's "nondelegation doctrine and the separation-of-powers
principles that it embodies." Pet. 10. At bottom, petitioners argue
that, where a tax is initially formulated and imposed in the absence of
a valid legislative delegation of power, that tax cannot retroactively be
rendered lawful by subsequent legislation. Pet. 12-13.
Petitioners, however, cite no case of this Court so holding, and this Court's
decisions in United States v. Heinszen, 206 U.S. 370 (1907), and Rafferty
v. Smith, Bell & Co., 257 U.S. 226 (1921), are to the contrary. Heinszen
concerned import duties that this Court had, in earlier decisions, declared
unlawful on the ground that Congress had not authorized them. 206 U.S. at
380. By the time Heinszen was decided, however, Congress had enacted new
legislation that "legalized and ratified and confirmed" the collection
of those duties "as fully as to all intents and purposes as if the
same had, by prior act of Congress, been specifically authorized and directed."
Id. at 381 (quoting Act of June 30, 1906, ch. 3912, 34 Stat. 636). Relying
on its own precedents and on settled agency principles, the Court held that
Congress could legalize and ratify otherwise unauthorized duties whenever
Congress could have lawfully imposed those duties in the first instance,
so long as the power to impose the duties remained unimpaired-by the creation
of intervening rights or otherwise-on the date of ratification. 206 U.S.
at 382-384.
In Smith, Bell & Co., this Court reiterated and again applied that principle.
There, the Supreme Court of the Phillippines had held that certain taxes
were invalid because they had not been authorized by Congress. While that
decision was pending on review in this Court, Congress enacted legislation
to ratify and legalize the taxes. See 257 U.S. at 231-232. This Court held
that Congress's power to ratify and legalize those taxes "necessarily
follows from the doctrine announced in United States v. Heinszen & Co."
Smith, Bell & Co., 257 U.S. at 232. Accordingly, it reversed the judgment
of the Phillippines Supreme Court. Id. at 232-233.
As the court of appeals correctly recognized, Pet. App. 11a-15a, the same
principle controls this case. Petitioners do not dispute that Congress could
have imposed the fees at issue here in the first place. Nor do they claim
that any intervening right impaired Congress's power to impose the fee at
the time it enacted Section 8003. As a result, under Heinszen and Smith,
Bell & Co., Section 8003(a) rendered those fees, in contemplation of
law, no less enforceable than they would be if Congress had expressly authorized
their collection in the first instance. In the words of Section 8003(a),
the fees now have the same legal status they would have had if they "had,
by prior Act of Congress, been specifically authorized and directed."
Pub. L. No. 105-174, 112 Stat. 93 (Pet. App. 97a-98a).
Nor can Congress's ratification of the fees be attacked (Pet. 13, 15) as
an excess delegation. Congress did not purport to delegate retroactively
to NSF unbridled authority to establish registration fees. Rather, Congress,
without according any discretionary authority to NSF, simply ratified the
very fee-in the same amount-that NSF had previously sought to establish
in its cooperative agreement with Network Solutions, but which had initially
been set aside by the district court. Because petitioners do not question
that Congress could have expressly established the 30% charge itself in
the absence of NSF's prior action, it is difficult to see why legalization
and ratification of that fee does not constitute a lawful exercise of the
congressional power this Court recognized in Heinszen and Smith, Bell &
Co. 4
Rather than dispute the principles underlying Heinszen, petitioners assert
that "[t]he opinion below thus stands for the proposition that whatever
Congress does is self-justifying from a separation-of-powers standpoint,
which renders the nondelegation doctrine altogether meaningless." Pet.
13. In so asserting, petitioners fail to grasp that this Court's "nondelegation
doctrine" is inapplicable where Congress has not "delegated"
discretion to an administrative agency but has itself acted to require the
very conduct being challenged. Where Congress itself acts, the nondelegation
doctrine is irrelevant. Petitioner is thus wrong in asserting that the case
involves "Congress' power to delegate to the National Science Foundation
the unfettered authority to legislate a tax." Pet. 15. As embodied
in Section 8003, the "tax" (if it may properly be called that)
in this case was imposed retroactively by Congress without any delegation
to NSF. As Section 8003 states, the 30% fee was "legalized and ratified
and confirmed as fully to all intents and purposes as if the same had, by
prior Act of Congress, been specifically authorized and directed."
Section 8003(a), Pub. L. No. 105-174, 112 Stat. 93 (emphasis added) (Pet.
App. 97a-98a).
Finally, petitioners are incorrect (Pet. 15-17) to suggest that this application
of Heinszen threatens separation of powers principles, or somehow shifts
Congress's taxing powers to the executive branch. The power to authorize
(or withhold authorization for) the imposition of the fees at issue here
rested at all times with Congress, and it was Congress that-by enacting
Section 8003-determined the validity of the fees and thus the outcome of
this case. What petitioners complain about thus is not an excess delegation
of authority to an agency. It is instead the manner in which Congress, a
politically accountable branch, exercised its constitutional power to legislate.
See Pet. 16 (complaining that the agency's "partisans [might] convince
Congress of the usefulness of the already-collected funds"); Pet. 17
(contending that Congress "quietly" slipped the "ratification
in an omnibus bill late one evening"). In the absence of some contention
that Congress violated one of the specific guarantees contained in the Constitution,
however, that sort of complaint is properly directed to the political branches,
through the electoral process; it is not actionable in this Court.5
2. Petitioners also claim that the 70% portion of the registration fee (which
compensates Network Solutions for its services) was imposed in violation
of the Independent Offices Appropriations Act (IOAA), 31 U.S.C. 9701. That
claim too does not implicate a division in circuit authority, and it too
is without merit.
As the court of appeals explained, the IOAA provides criteria for the establishment
of the fees to be charged for "a service or thing of value provided
by an agency." 31 U.S.C. 9701(a). See Pet. App. 22a. Hence, as the
court of appeals held, the IOAA does not apply to this case because neither
the NSF nor any other governmental entity provides the registration services
for which the challenged fees are charged. Ibid. Rather, a private organization,
Network Solutions, provides the registration services, and Network Solutions
charges the fee that petitioners challenge.6
For that reason, this case differs dramatically from National Cable Television
Ass'n v. United States, 415 U.S. 336 (1974), upon which petitioners rely
(Pet. 19). That case involved licensing fees imposed by the Federal Communications
Commission (FCC) on the cable television systems it regulated; the question
was whether the FCC had violated the IOAA in selecting the standard for
"setting the fee." 415 U.S. at 343. Since the fee was imposed
and the services were provided by a government agency, it was undisputed
that the IOAA applied. Here, in contrast, the fee is imposed and the services
are provided by a private entity not subject to the IOAA.
Petitioners attempt to evade that distinction by arguing that NSF must be
charged with the responsibility for the fees assessed by Network Solutions
because Network Solutions is supposedly an "agent" of NSF. Pet.
20. That argument assumes its conclusion, namely that Network Solutions
is the "agent" of NSF. As explained above, NSF entered into a
cooperative agreement with Network Solutions to register domain names, but
in doing so, NSF was not contracting out any function or obligation that
NSF itself ordinarily fulfills. The court of appeals specifically noted
that point, emphasizing that this is not a situation where an agency has
"farmed out" the performance of a statutory duty to a private
contractor. Pet. App. 21a. Indeed, it is hard to see how Network Solutions
could be NSF's agent given that NSF does not control or direct Network Solutions'
actions or operations. See p. 4, supra; Pet. App. 22a. Petitioners' argument
thus would stretch the law of agency past the breaking point, as it would
mean that a government agency's use of a cooperative agreement would render
the agency responsible for all the actions of the counterparty to that agreement.
That is not, and has never been, the law.
Petitioners also argue that "the registration of '.com' domain names
is and always has been a quintessential government service, just as the
licensing of wavebands and channels is a government function notwithstanding
the increasing commercialization and deregulation of television, cable and
radio." Pet. 23. That assertion too is incorrect. Unlike radio wavebands
and television channels, which are subject to allocation and control by
the FCC,7 neither the Internet itself nor domain names have ever been under
the control of the United States government or otherwise been subject to
allocation or licensing by the government. Indeed, domain name registration
originally was a function provided not by the government, or Network Solutions,
but by the late Dr. Postel at the University of Southern California. Pet.
App. 23a. As the court of appeals noted, "[a] recent and novel function
such as domain name registration hardly strikes us as a 'quintessential'
government service." Ibid.
CONCLUSION
The petition for a writ of certiorari should be denied.
Respectfully submitted.
SETH P. WAXMAN
Solicitor General
DAVID W. OGDEN
Acting Assistant Attorney
General
WILLIAM KANTER
MARK W. PENNAK
Attorneys
DECEMBER 1999
1 NSFNET was developed in 1987 by IBM, MCI and Merit, Inc. under an NSF
award. Management of Internet Names and Addresses, 63 Fed. Reg. 31741, 31742
(1998).
2 In 1992, Congress clarified NSF's authority to provide financial support
for, inter alia, the development and operation of a domain name registration
system that extended beyond the realm of the scientific research and education
community to include purely commercial uses, so long as "the additional
uses will tend to increase the overall capabilities of the networks to support
such research and education activities." See Advanced-Technology Act
of 1992, Pub. L. No. 102-476, § 4, 106 Stat. 2300 (codified at 42 U.S.C.
1862(g)).
3 The amended complaint also alleged that (a) that the Administrative Procedure
Act's rulemaking provisions required NSF to provide for notice and comment
before entering into the amendment of the Cooperative Agreement providing
for registration fees (Count V); (b) NSF had bestowed upon Network Solutions
federal property in violation of Article IV, Section 3 of the Constitution
(Count VIII); and (c) NSF had violated the antitrust laws by conspiring
with Network Solutions to help Network Solutions control the domain name
registration market (Count IX). The district court dismissed those claims,
Pet. App. 41a-78a, the court of appeals affirmed, id. at 15a-20a, 24a, and
petitioners do not seek further review.
4 Petitioners at one point (Pet. 13-14) seem to attempt to distinguish Heinszen
as a case in which Congress merely corrected a drafting error. Petitioners,
however, point to no decision of this Court so construing Heinszen and-even
if we assume arguendo that Heinszen did involve a drafting error-there is
no indication that this Court's decision turned on that alleged fact. To
the contrary, the Court's decision in Heinszen was based on common law doctrines
and prior decisions concerning ratification; nothing in Heinszen (or in
the Court's later decision in Smith, Bell & Co.) suggests that the result
was related to the purported fact that a drafting error was involved.
5 Nor can it be claimed (Pet. 16) that Heinszen's doctrine may tempt agencies
to impose unlawful taxes in the speculative hope that Congress will later
ratify those taxes. The normal presumption is that executive officers (and
administrative agencies) will attempt to follow the law in good faith, and
petitioners have made no showing of bad faith here. In any event, Heinszen
has been the law for more than 90 years, and petitioners offer no evidence
that the practice they purport to fear-the imposition of unauthorized taxes
in the hope that Congress will ratify them-has become common.
6 Indeed, as originally enacted, the IOAA contained at least one provision
contemplating that revenues from the services or things of value will be
deposited in the treasury. Pet. App. 23a (citing 31 U.S.C. 483a (1976)).
Although that provision was omitted at recodification as unnecessary in
light of other requirements, it strongly suggests that the IOAA was not
designed to apply to fees collected by private companies for services provided
by those companies. Pet. App. 24a.
7 See, e.g., Columbia Broad. Sys., Inc. v. Democratic Nat'l Comm., 412 U.S.
94, 104 (1973) ("It quickly became apparent that broadcast frequencies
constituted a scarce resource whose use could be regulated and rationalized
only by the Government. Without government control, the medium would be
of little use because of the cacophony of competing voices, none of which
could be clearly and predictably heard.") (quoting Red Lion Broad.
Co. v. FCC, 395 U.S. 367, 376 (1969)).