IJ Sails to Victory for Economic Liberty

For years, the Institute for Justice has litigated to curtail the power of federal agencies to restrict Americans’ economic freedoms. This spring, we secured another victory in that effort: IJ client Captain Matthew Hight won a lawsuit against the U.S. Coast Guard and a private monopoly’s attempt to wrongfully deprive him of his right to earn a living as a pilot on the St. Lawrence Seaway.

Captain Hight is a veteran mariner. He spent decades training on the high seas and eight years captaining ships. After his time at sea, he decided to return stateside and train to become a pilot, navigating cargo carriers on the Great Lakes. Pilots take over for captains in narrow waters, or when in a harbor, applying local knowledge to tricky navigational situations.

Captain Hight applied to the private pilots’ association and trained with it for more than two years. He had nearly achieved his pilot’s license when he had a disagreement with the association president. Suddenly, the association informed the Coast Guard—the federal agency that regulates Great Lakes pilots—that it would not recommend Captain Hight for his pilot’s license. The Coast Guard deferred to the private agency and left Captain Hight marooned with no license and no job.

Captain Hight challenged his rejection, but the Coast Guard said that he could not take the pilot’s exam unless the private association—which has a legal monopoly over pilots—gave him a positive recommendation. With his dreams of becoming a pilot foundering, Captain Hight teamed up with IJ to file a federal lawsuit challenging the Coast Guard’s delegation of its power, arguing that it violated both the Constitution and the Coast Guard’s own regulations.

The federal district court in the District of Columbia agreed, ruling that the Coast Guard had indeed violated its own regulations. The judge wrote that regardless of whether the agency thought its interpretation of the rules was good policy, “that is not what the regulations say, and the text controls.” The court also noted that the government failed to offer any interpretation of its regulations that would justify its delegation of authority to the pilots’ association.

This decision is an important vindication of the principle that government must follow its own rules and regulations. It is also a stern warning to federal agencies that federal courts will not allow them to interpret their own rules however they wish in any given circumstance. The text controls. Here, the text gives qualified workers like Captain Hight the chance to earn an honest living.

Thanks to this ruling, the Coast Guard must now administer the pilot’s exam to Captain Hight. IJ will be watching closely to ensure that it administers the exam fairly—and that Captain Hight can set sail and pursue his dream.

Adam Griffin is an IJ constitutional law fellow.