Supreme Court Determines Statute of Limitations Accrual for Administrative Procedure Act

In Corner Post, Inc. v. Board of Governors Of The Federal Rsrv. Sys., the Supreme Court will decide when a claim first accrues under the Administrative Procedure Act (APA).

Petitioner Corner Post, Inc. is a convenience store and truck stop in North Dakota that first opened for business in 2018. Required by law to accept debit-card payments, and therefore required to pay the mandatory fee for each debit-card transaction, Corner Post has paid hundreds of thousands of dollars in debit-card fees. Corner Post joined a suit against the Board of Governors of the Federal Reserve System under the APA challenging the requirement to accept debit-card payments and their fees.

The Board moved to dismiss Corner Post’s claims as time barred under 28 U.S.C. §2401(a) because a six-year statute of limitations applies to facial challenges to an agency action, and the action here was undertaken in 2011. The statute of limitations on making any challenge to the debit-card requirement thus expired in 2017, even for entities like Corner Post, which had not opened for business until a year later. The district court dismissed Corner Post’s claim. The Eighth Circuit affirmed, holding that such an action accrues upon publication of the regulation.

In its briefing, Corner Post argued that any action under the APA should accrue as soon as a plaintiff can first sue, and the statute of limitations should therefore not turn on the timing of the regulation itself. It pointed to language in Section 2401(a) stating that the six-year statute of limitations period starts when a claim “first accrues.” Because an APA plaintiff has a cause of action only when he has been injured, Corner Post argued the statute of limitations should not begin to run until Corner Post was injured. By contrast, the Board argued that the correct accrual point for a cause of action under the APA is after the “final agency action,” which in this case was the final publication of the regulation in 2011. The Board also argued that to hold otherwise would impose a significant burden on the government agencies.

During oral argument, Justice Thomas questioned whether there were any instances when a court had allowed an action against an agency so long after the rule had been finalized. Justice Kagan questioned whether the text of the statute of limitations really offered any insight into situations like the present case where certain terms have been understood to have a different meaning in practice. Chief Justice Roberts questioned whether any other agency recourse was available to an entity like Corner Post, who had started business, and thus was not injured until, after the statute of limitations had run.

The case was argued on February 20, 2024. A decision is expected later in the term. Stay tuned for Dykema’s client alert discussing the Court’s opinion.

For more information, please contact Chantel Febus, James Azadian, Cory Webster, Christopher Sakauye, McKenna Crisp, Monika Harris, or Puja Valera.