## Facts

- USDA’s Food Safety and Inspection Service (FSIS) reviews meat and poultry labels for compliance with federal requirements.
- Before the challenged change, label-approval requests could be submitted by mail, by personal visit from producers, or through courier/expediter firms that met face-to-face with FSIS staff.
- FSIS adopted a rule eliminating face-to-face submission of label requests and requiring non-face-to-face submission methods (e.g., mail) without using notice-and-comment procedures.
- James V. Hurson Associates, Inc., a courier/expediter, alleged the change harmed its business model, which depended on in-person presentations to FSIS.
- Hurson sued under the Administrative Procedure Act (APA), arguing the rule required notice and comment and also sought to pursue arbitrary-and-capricious and Interstate Commerce Clause theories.

## Issues

1. Whether the USDA rule eliminating face-to-face label submissions was a “procedural rule” exempt from APA notice-and-comment requirements.
2. Whether the district court erred by denying Hurson leave to amend its complaint to add (a) an arbitrary-and-capricious claim and (b) an Interstate Commerce Clause claim.

## Decision

- The court held the rule was procedural because it governed the manner of submitting label requests and did not change substantive label-approval standards; notice and comment were not required.
- The court held Hurson had a right under Federal Rule of Civil Procedure 15(a) to amend once as a matter of course because USDA had not filed a responsive pleading; the district court erred in denying amendment as to the arbitrary-and-capricious claim.
- The court declined to remand for amendment to add the Commerce Clause claim because the proposed claim would be futile and could not survive dismissal.
- Disposition: affirmed the procedural-rule holding; vacated in part and remanded solely to permit amendment to add the arbitrary-and-capricious claim.

## Legal Principles

- An agency rule that regulates only the form or manner by which parties submit information to the agency, without changing substantive standards for agency action, is a procedural rule exempt from APA notice-and-comment requirements.
- A rule’s significant economic effects on regulated entities do not, by themselves, convert a procedural rule into a substantive rule requiring notice and comment.
- Under Rule 15(a), a plaintiff may amend once as a matter of course before service of a responsive pleading; a court errs by denying that amendment on discretionary grounds when the right applies.
- Courts may deny or limit amendment where the proposed claim would be futile because it would fail as a matter of law.

## Conclusion

The D.C. Circuit treated USDA’s elimination of in-person label submissions as a procedural change exempt from notice-and-comment rulemaking, while requiring the district court to allow amendment to assert an APA arbitrary-and-capricious challenge but not a futile Commerce Clause claim.


James V. Hurson Assocs., Inc. v. Glickman, 229 F.3d 277 (D.C. Cir. 2000)