Appeals Court Tosses Out EOBR’s

October 1, 2011

On August 26, 2011, the US Court of Appeals for the Seventh Circuit decided against the Federal Motor Carrier Association’s (FMCSA) Final Rule No. 2004-18940, better known as the Electronic On Board Recorder (EOBR) rule set to take effect June 4, 2012.  Their reason – the rule does not do enough to prevent harassment of drivers.

The rule would have required habitual violators of the hours of services rules to install EOBRs.  The problem according to the Court is the FMCSA did not provide enough information on how it intends to prevent carriers from harassing drivers who are using the EOBRs.
Turning to the merits, the petitioners raise three reasons for vacating the 2010 final rule. First, they argue that the regulation is arbitrary and capricious because it does not “ensure that the devices are not used to harass vehicle operators,” as required by 49 U.S.C.
§ 31137(a); see 5 U.S.C. § 706(2)(A). Second, they argue that the Agency’s cost-benefit analysis is arbitrary and capricious because it fails to demonstrate the benefits of requiring EOBRs. Finally, the petitioners argue that mandating EOBRs violates the Fourth Amendment. We need address only the first issue.

Our starting point is the Supreme Court’s State Farm decision, which explained that normally, “an agency rule would be arbitrary and capricious if the agency has . . . entirely failed to consider an important aspect of the problem” before it. Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). This was the principle at issue in the earlier Public Citizen decision about these very rules. In Public Citizen, the D.C. Circuit applied the well-established rule that when an agency fails to consider a factor mandated by its organic statute, this omission is alone “sufficient to establish an arbitrary-and-capricious decision requiring vacatur of the rule.” 374 F.3d at 1216; see also Texas Oil & Gas Ass’n v. EPA, 161 F.3d 923, 934 (5th Cir. 1998). When Congress requires an agency to address something before issuing a regulation, that factor is by definition an “important aspect of the problem” under State Farm. See Public Citizen, 374 F.3d at 1216. This is in contrast tofactors an agency “may” consider, which might not always be an “important aspect” of a problem. Adherence to this rule is essential because it goes directly to the scope of the authority delegated to an agency by Congress; when an agency ignores a mandatory factor it defies a “statutory limitation on [its] authority.” United Mine Workers v. Dole, 870 F.2d 662, 673 (D.C. Cir. 1989). Such an act is necessarily arbitrary and capricious.

What the Court is saying in their legalese is that FMCSA broke their rules by failing to adhere to the requirement of the Truck and Bus Safety and Regulatory Reform Act of 1988 (ACT) .   The ACT specifically “foresaw that monitoring devices on trucks might be used to enforce Hours of Service rules, and that these devices could potentially be used to harass drivers.”  Essentially, a law is a law and must be obeyed.

How could an EOBR harass a driver?  According to the petition, carriers could put pressure on drivers to keep driving as long as there is time remaining under the HOS according to the EOBR.  This could be harassment if the driver was tired yet had to continue driving under carrier pressure. Keep in mind the original rule to put EOBRs in bad carriers would punish not only the drivers with excess HOS violations, but also the drivers with no HOS violations with the same carrier.

Where the FMCSA got into trouble with the court is their failure to take into account the requirement of the ACT.  FMCSA put into the rule that the agency had taken the requirement of the ACT into account, and said its statement is enough to satisfy the requirement of the ACT.

“It is not,” said the Court, “but does represent the total Agency consideration of harassment in the rule.”  The Court said the FMCSA “must articulate a reason for its actions that demonstrates a ‘rational connection between the facts found and the choice made.’  …Its explanation may not be superficial or perfunctory.”

“The Agency’s failure to respond to this concern, which describes a form of harassment that the statute required it to address and that raises problems distinct from privacy, renders the rule arbitrary and capricious,” the Court said in vacating and remanding the EOBR regulation for additional rulemaking.

My client carriers and drivers who have EOBR’s in their trucks like them.  Both carrier and driver keep telling me the EOBR has made their life easier and more productive.  Carriers say HOS violations drop dramatically with the use of EOBRs which helps their CSA scores.  Drivers say their jobs are easier and they get more miles because the carrier is better able to schedule their loads.  Another big plus is the respect law enforcement has for drivers with EOBRs, they issue a lot less HOS violations for form and substance alone which is one of the major areas for HOS violations.

This court case is just the first of many you may expect to be filed and decided because of the new regulations coming to trucking.  For example, the new Hours of Service Rules has already been picked by both the American Trucking Association on behalf of the industry and Public Citizen who has been fighting trucking for many years over Hours of Service.

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The information, advice and opinions in Legal Lane are entirely those of Jim C. Klepper.