June 28, 2024, 4:42 p.m.
Conservative Supreme Court justices opened up a new avenue to challenge federal rulemaking Thursday, overturning a decades-old, landmark precedent governing when the judiciary defers to an agency's interpretation of the law.
In a 6-3 decision—which all three liberal justices opposed—in Loper Bright Enterprises v. Raimondo, the high court said that courts do not have to defer to the expertise of federal regulators when deciding challenges to rules when the letter of the law isn’t clear, a 40-year precedent known as the Chevron doctrine.
“Perhaps most fundamentally, Chevron’s presumption is misguided because agencies have no special competence in resolving statutory ambiguities. Courts do,” justices wrote in the majority opinion.
The decision could spark a wave of court challenges to regulatory policy in areas such as health care, environment, tech, and finance, and it is a win for conservatives looking to diminish the administrative state. The ruling could also stymie Biden administration priorities on issues that rely on ambitious regulation, such as combating climate change. Importantly, the decision does not affect past regulations devised under Chevron.
Though the case revolves around the relationship between the courts and the executive branch, congressional Republicans plan to use their legislative and oversight powers to capitalize on the decision and make it easier to challenge federal rulemaking.
“House Republican committees will be conducting oversight to ensure agencies follow the Court’s ruling and no longer engage in excessive interpretative license in administering statutes under their jurisdiction.” House Speaker Mike Johnson, Majority Leader Steve Scalise, and Whip Tom Emmer said in a joint statement Friday.
Rep. Kevin Hern, chairman of the Republican Study Committee, the largest bloc of conservatives in the House, circulated a letter earlier this week outlining how his caucus wants Congress to help target federal regulations.
“Each House committee should scour Biden-era regulatory actions and highlight any that should be considered for judicial review post-Chevron,” the letter said.
Hern mentioned several outstanding bills that Congress should take up, including the Separation of Powers Restoration Act, which would codify a ban on Chevron into law, and the REINS Act, which requires Congress to approve any regulation that has an annual impact of $100 million or more.
At the core of the case is a judicial doctrine, little known beyond legal circles, that has become a major underpinning of administrative law. The doctrine stems from the landmark 1984 decision in Chevron v. Natural Resources Defense Council, in which the Court ruled that judges must defer to an agency's “reasonable” interpretation of laws passed by Congress. When the statute is ambiguous on a particular issue or has multiple reasonable interpretations, the agency’s view takes priority over past court decisions.
Since its inception, the doctrine has played a key role in legal challenges to agency actions that center around how an administration interprets legislation. It has been cited in lower and Supreme Court decisions some 18,000 times, according to the Congressional Research Service. Critics, though, have said Chevron has increasingly shifted authority to interpret law from the courts to agencies and over the past decade, the Supreme Court has relied less and less on the doctrine.
Friday’s decision is a worst-case scenario for proponents of more strict federal regulation in a range of policy areas beyond the environmental arena at the core of the original case. Even if a Democratic Congress and administration can pass tighter rules on the environment, privacy, climate change, and other issues, it will likely be harder to make them stick when challenged.
Rep. Jamie Raskin gave the Clean Water Act as an example of how Chevron works, saying that while Congress mandated the general principle that drinking water should be safe, lawmakers don’t have the resources to constantly update legislation that deals with new kinds of toxic threats. They leave that to the Environmental Protection Agency’s rulemaking authority.
“You could talk about the U.S. Department of Agriculture, you could talk about the EPA, you could talk about the National Labor Relations Board, any federal agency will have its entire work product thrown into the air by overturning the federal decision,” Raskin said Thursday, before the ruling came down.
Leaving it up to agencies to handle the specifics won’t work anymore, Sen. Chuck Grassley said in a statement. Grassley said the decision “restores appropriate balance” and that Congress “will now be under extreme pressure to be more specific when writing legislation, so that a bill’s plain text can be clearly interpreted by the courts and federal agencies when legislation becomes law.”
The Bipartisan Policy Center noted in a blog post Friday that the ruling could spur congressional offices to ramp up levels of expertise on policy issues, increasing staff, tools, and access to information to write legislation with much more detailed instructions to federal agencies.
“Member office, committee, and congressional support agency capacity has been declining for decades, leaving Congress shorthanded and without much of the expertise needed to carry out a more prescribed lawmaking style,” the think tank noted.
Rep. Pramila Jayapal, chairwoman of the Congressional Progressive Caucus, has introduced legislation in previous Congresses to codify Chevron into law, but it’s unlikely to pass in the current congressional makeup. Still, Jayapal said she’s going to reintroduce the Stop Corporate Capture Act in the next week.
“I am horrified,” Jayapal said of the decision. “It is unfortunately what I expected because this is a Court bought and paid for by these big corporate interests who don’t want people inside government writing rules that actually put the onus on corporations to modify their behavior.”
The Loper Bright case involves a 2020 rule enacted by the National Marine Fisheries Service that required fishing vessels to take aboard regulatory-compliance officials at their own expense, about $710 per day, per court documents.
The U.S. Court of Appeals for the District of Columbia sided with the government, saying the law does not state who must cover the cost for fishing boats to carry monitors. The National Marine Fisheries Service’s interpretation of federal fishery law was reasonable, and thus the courts must defer to it under the Chevron doctrine, the lower court said.
The case drew attention from organizations outside of the fishing industry, with free-market groups such as the Cato Institute and Manhattan Institute filing amicus briefs. A group of 36 GOP lawmakers, led by Sen. Ted Cruz of Texas and House Speaker Johnson, also weighed in with their own amicus brief, arguing “the court should unequivocally abandon Chevron” because it contradicts the separation of powers in the constitution and the Administrative Procedure Act, which governs the federal rulemaking process.
Following the ruling Friday, West Virginia Attorney General Patrick Morrisey, who led a coalition of states pushing the Court to overturn Chevron, said the justices made the right decision.
“Congress’s words matter, not agencies’ policy preferences,” Morrisey said in a statement. “And agencies shouldn’t be permitted to take advantage of statutory silence or ambiguity to extend their powers beyond what Congress intended.”
Loper Bright wasn’t the only decision this term to strike at the administrative state. On Thursday, Justices delivered a 6-3 ruling in SEC v. Jarkesy that stripped the Securities and Exchange Commission of the ability to use in-house tribunals to seek civil penalties for securities fraud. The Court ruled that a defendant is entitled to a jury trial.
That ruling could affect other agencies that seek civil penalties through administrative proceedings, such as the Agriculture Department or the Social Security Administration.
