Justice Kagan asked which provision of the INA was violated by DACA
The answer, which the Solicitor General alluded to in his brief, turns on the relationship between the major question doctrine and the nondelegation doctrine
During oral argument in the DACA case, very little time was spent on whether the policy itself was lawful. Almost all of the questions from the bench concerned whether the cancellation memo was reviewable, whether Secretary Duke adequately considered reliance interests, and whether Secretary Nielsen's provided an independent basis to cancel DACA.
There was only one significant colloquy between Justice Kagan and SG Francisco about the legality of the policy. Here it is, slightly truncated for readability:
GENERAL FRANCISCO: And my final and critical point is that there's no limiting principle. The theory on which DACA rests effectively allows the government to create a shadow INA for any category of aliens that it chooses to make low-priority targets, a shadow second-tier INA. And you, at the very least, need to locate something in the INA that confers that kind of broad and unfettered discretion. And there is simply nothing there. But, again—…
JUSTICE KAGAN: You know, the INA does give quite a lot of discretion to administrative officers, as you yourself admit and have argued on previous occasions and, indeed, in part here. … are you saying that DACA was --violated any particular provision of the INA? What are you saying it violated? … -because there's a big delegation, right, that says you get to make national policy. So what did DACA violate? …
GENERAL FRANCISCO: But, secondly, we're not saying that there's a specific provision that it conflicts with. But what we are saying is that when you adopt this kind of broad and historically unprecedented program, you need to at least locate the authority to do so somewhere in the INA. …
JUSTICE KAGAN: --you know, they located the authority in the INA's grant of broad discretion over national immigration enforcement policy.
GENERAL FRANCISCO: Your Honor, I think that the most that does is it gives you the authority to set policies and priorities, but there's a big leap between that and saying that you can affirmatively facilitate violations of the INA by hundreds of thousands of individuals to whom Congress has repeatedly declined a pathway to lawful status.
I found Francisco's answer somewhat unsatisfying, but predictable. (I regret that the Court denied Texas's motion to argue as amicus curiae; it could have presented a much more forceful attack on DACA, as it did before the 5th Circuit with respect to DAPA). The federal government has always been cagey about precisely what the legal and constitutional defects were in DACA–for an obvious reason. The SG is usually not in the position to argue that federal law limits the executive's power. Here, of course the Trump Administration has taken exactly that position. What then, is the answer to Justice Kagan's question? Which provision of the INA does DACA violate?
Generally, when a party argues that some executive policy is illegal, she would contend that the policy violates a specific statute. That is, the statute authorizes X, and the government does something other than X. But the SG's arguments about DACA's illegality are different: if the statute in fact authorizes X, then the statute unconstitutionally delegates legislative power to the executive branch. To avoid reaching the conclusion, the court should presume that Congress did not intend to delegate to the agency the power to resolve such a "major question." Here, the major question did not consider forbearance of removal; rather it concerns bestowing benefits including work authorization on 1 million+ aliens. (Texas never challenged the prioritization aspect of DAPA and DACA.) As a result, the Court should find the action was ultra vires–that is, beyond the scope of delegated authority. In short, Kagan questioned the government about an argument it never made.
SG Francisco's answer comes as close as possible as the SG can get to articulating the nondelegation doctrine.
Later in the argument, Ted Olson seemed perplexed at what the "constitutional defects" were in DACA:
OLSON: The Attorney General specifically said that DACA was illegal and unconstitutional. I don't know where the unconstitutional came from because it didn't come from the Fifth Circuit.
Respondents contend (N.Y. Br. 31-42) that DHS offered an inadequate explanation for its legal analysis. But the APA requires only that "the agency's path may reasonably be discerned." State Farm, 463 U.S. at 43 (citation omitted). Both memoranda reflect DHS's conclusion that the DACA policy exceeded the agency's "statutory authority." Regents Pet. App. 116a, 123a. That conclusion does not depend on whether DACA prevented DHS officials from exercising any discretion. See pp. 19-20, supra. And neither Secretary "place[d] any significant weight" on Attorney General Sessions' statement that DACA was unconstitutional, FCC v. National Citizens Comm. for Broadcasting, 436 U.S. 775, 804 n.23 (1978)—which, in any event, simply underscored his strongly held view that DACA was based on a statutorily unauthorized exercise of Executive power.
Regardless of whether the Secretaries placed any weight on that determination, by statute, they were bound by the AG's legal conclusions. (I suspect the DHS lawyers requested this sort of hedge because the agencies routinely rely on very broad–and in my estimation dubious–delegations of authority.) This rationale provides enough basis to support the cancellation of DACA.
The Cato Institute's amicus brief (which I co-authored) carefully explains the relationship between DACA, the INA, the nondelegation doctrine, and the major question doctrine. I maintain that this argument is the only viable path by which the Court can find that DACA is in fact illegal, and uphold the Attorney General's legal determination. Here is the key excerpt (pp. 18-19):
First, consider the regulation that authorizes the secretary to grant DACA recipients with work authorization, with which we can presume the attorney general was familiar.6 8 C.F.R. 274a.12(c)(14) provides a crystalline illustration of the elephant-in-mousehole framework. In 1987, the Immigration and Naturalization Service denied a petition for rulemaking to re-strict the issuance of work authorization to certain aliens. See Dep't of Justice, Immig. & Naturalization, Employment Authorization; Classes of Aliens Eligible, 52 Fed. Reg. 46,092 (Dec. 4, 1987). The government justified the denial, in part, because the number of such work authorizations would be "quite small"—so small, that the number was "not worth recording statistically." Id. at 46,092-93. Moreover, such authorizations would "normally [be] of very limited duration," and would be very rare. Id. at 46,092.
DACA operates in a very different fashion. The policy could provide roughly 1.5 million aliens with work authorization, and those authorizations could be renewed for years to come.7 This elephantine-sized grant of work authorizations—limited in neither size and "with no established end-date"—cannot conceivably be jammed into a not-statistically-significant mousehole. In every sense, this provision of benefits relies on a reading of federal immigration law that amounts to "an unconstitutional exercise of authority by the Executive Branch"—that is, the exercise of legislative powers. The attorney general's conclusion is consistent with the Court's admonition in Brown & Williamson: "Congress could not have intended to delegate a deci-sion of such economic and political significance"—the ability to provide work authorization to 1.5 million aliens—"in so cryptic a fashion."8
This argument does not in any way rely on policy rationales. If DACA, no amount of reliance interests can justify its continued enforcement.