Maryland Small Business Will Appeal After District Court Affirms Department of Labor Courts That Hand Down Ruinous Fines

WASHINGTON—The Institute for Justice (IJ) will appeal on behalf of C.S. Lawn & Landscaping, a Maryland small business owned by Chuck Saine, after a federal district court upheld the Department of Labor’s (DOL) use of its system of administrative law judges (ALJs) to hand down ruinous fines. Saine and IJ argue that he should have been entitled to make his defense in a real federal court, with a real federal judge.

“Americans have a constitutional right to a judge and jury before the government takes their private property,” said IJ Senior Attorney Jared McClain. “C.S. Lawn & Landscaping’s seven-year slog defending itself against DOL’s allegations in DOL’s in-house courts with no trial by jury does not square with the Constitution.”

The decision from the U.S. District Court for the District of Columbia rules that Saine is not entitled to a jury because DOL’s penalties help protect the market for American workers. The decision runs completely counter to (but does not mention) last year’s ruling by the U.S. 3rd Circuit Court of Appeals in Sun Valley v. U.S. In that case, a farm represented by IJ secured a unanimous ruling that the agency’s imposition of fines through its agency court violated the Constitution and that charges against the farm had to be brought in an independent federal court.

C.S. Lawn & Landscaping is a small business that specializes in landscape design, installation, and maintenance for both residential and commercial clients in and around Annapolis and Kent Island. For decades, C.S. Lawn participated in the federal government’s H-2B visa program, which allows employers to bring workers into the country legally to fill jobs that cannot be filled by the domestic labor market.

Early in 2015, a DOL investigator began to examine C.S. Lawn, looking for violations of regulations that govern H-2B employers. After decisions by an ALJ and DOL’s Administrative Review Board were completed in 2022, DOL issued a final decision imposing almost $55,000 in liability—$38,083.20 in back wages and $16,000 in civil monetary penalties. The bulk of this liability ($36,000 in back wages plus $7,500 in penalties) was imposed because of an alleged violation of the local zoning code, not federal rules. The apartment that workers lived in was located in an area zoned Suburban Industrial (though the local zoning code does allow for migrant labor camps in the area).

In addition to the C.S. Lawn and Sun Valley cases, IJ is also representing a small farm in Kentucky which is challenging whether it must conclude agency proceedings before it can get its case into federal court. IJ is also helping a small business in Oklahomachallenge a Department of Justice administrative court.