Friday, June 28, 2024: U.S. Supreme Court Dissolved Decades-Old Precedent Giving Court Deference to Federal Agency Interpretations of The Laws They Enforce
Controversial “Chevron Doctrine” Repealed in Second Case Decision in Two Days Decreasing the Power of the Executive Branch, this time restoring Power to Congress
Federal courts are no longer required to and may not defer to an agency’s interpretation of the law simply because a statute is ambiguous, the U.S. Supreme Court (“High Court” or “SCOTUS”) ruled. The Court relied on the Administrative Procedure Act (“APA”) to restore power to the Courts to exercise their independent judgment to decide whether a federal agency has issued Rules (i.e., “regulations”) within the agency’s statutory delegation of authority from Congress.
The ruling came as no surprise to Court watchers since many Justices, led by now-deceased Justice Scalia, had signaled for years in prior opinions that they were disenchanted with the so-called “Chevron doctrine” and were looking for the case to overturn it. They found it last week in consolidated cases both of which involved the doctrine. A six Justice Court majority consisting of Chief Justice John Roberts and Justices Clarence Thomas, Samuel Alito, Neil Gorsuch, Brett Kavanaugh, and Amy Coney Barrett voted to overrule Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc, 467 U.S. 837 (1984).
The combined decision upended 40 years of Administrative Law precedent causing discontent among those favoring a stronger federal administrative state. That debate is not new and goes back to the early days of the new nation as it caused relations to strain between George Washington (a Federalist sympathizer) and Thomas Jefferson (an Anti-Federalist who believed that the best government is the one which governs least.)
SCOTUS consolidated the decision in Loper Bright Enterprises v. Raimondo [Case No. 22-451; appeal from an August 12, 2022, decision of the DC Circuit Court of Appeals] with the case of Relentless, Inc. v. Department of Commerce [Case No. 22–1219; appeal from March 16, 2023, decision of the First Circuit Court of Appeals (Boston)]. The Supreme Court majority vacated both of these lower court decisions. Justice Elena Kagan filed a dissenting opinion, in which Justice Sonia Sotomayor joined. Justice Ketanji Brown joined in Kagan’s dissent as it applied to Relentless. However, Justice Brown was forced to recuse herself from the Loper Bright Enterprises case based on her involvement with the case as a Judge when it earlier came up to the SCOTUS through the DC Circuit.
What is the Chevron Doctrine?
The “Chevron doctrine” refers to instructions the SCOTUS issued to all federal Judges in the above-referenced Chevron case decision. Those instructions mandated the federal courts to defer to the interpretation of a statute Congress had delegated to the federal agency to implement and enforce. It will come as no surprise to our readers that Congress occasionally (or perhaps routinely) passes poorly and ambiguously drafted statutes for the federal Executive Branch agencies to try to understand, draft regulations to implement, and to then enforce the delegated intent of Congress. And, it will likely come as no surprise to our readers that rather than faithfully implementing the Congressional intent of a statute, federal agencies sometimes (or perhaps regularly) have taken the liberty since Chevron to substitute their judgment for what is needed in place of the policy Congress mandated in its statute.
Under Chevron, judicial discontent grew as the cases coming across the desks of federal judges increasingly presented Rules that federal agencies wrote to enforce statutes delegated to them, but which stretched the policy directive of Congress. This was especially true when Congress would deadlock on an issue but nonetheless pass a statute. Legislators did so hoping that their party would have a President in The White House at the time the federal agencies would be writing (or amending) implementing Rules. If so, the federal agency writing those Rules could then adopt the point of view that the legislator had not been able to bake into the law. The art of drafting a statute became the ability to leave just enough ambiguous statutory language for federal regulation writers coming in behind passage of the statute to grab onto and build out the legislator’s point of view via after-the-fact Rulemaking. And, so the modern era of vague and ambiguous statutes was born as Congress fractured more and more over the last two decades and had trouble agreeing on even what was for lunch.
Federal judges knew many federal agency interpretations enlarged the original intent of Congress by adding agency “gloss” to their Rules implementing the statute and bringing the new statute to life. Chevron “tied the hands” of federal judges to reverse policies made in the federal agencies rather than in Congress. In essence, the Chevron doctrine provided that where Congress had delegated authority to an administrative agency and had not spoken directly to the precise issue, courts must nonetheless defer to the administrative agency’s answer or interpretation of the law unless “plainly wrong.” This increased the power of the Executive Branch to re-shape Congress’ intent.
The Supreme Court’s 1984 decision in Chevron established the Administrative Law principle that courts interpreting a Congressional statute could not overrule an administrative agency interpretation of the statute it was charged to enforce if the agency’s interpretation, embodied in a Rule (i.e., regulation) was not plainly in error. In other words, an agency could enlarge or even ignore Congressional direction in a statute so long as there was some plausible basis for the agency’s position and interpretation, however unlikely and far-fetched that interpretation might be. Rather, the courts had to “defer” to the agency’s even head-scratching and hard to imagine interpretation, and a court could not substitute its reading of the statute for that of the agency’s interpretation unless the agency was just plainly wrong.
Moreover, in 2005, SCOTUS held in National Cable & Telecommunications Assn. v. Brand X Internet Services, 545 U.S. 967, that a federal agency could even overrule a U.S. Supreme Court decision interpreting a statute differently than the agency IF the agency merely issued a final Rule after the SCOTUS opinion interpreting the statute at issue differently than SCOTUS had previously interpreted the statute.
Loper Bright Enterprises Decision
Chief Justice Roberts wrote Friday’s majority opinion, which Justices Thomas, Alito, Gorsuch, Kavanaugh, and Barrett joined. Thomas and Gorsuch also filed concurring opinions.
The Chief Justice began his 35-page opinion with a lengthy review (pages 7-18) of the relevant law, history, and precedent before concluding that “[t]he deference that Chevron requires of courts reviewing agency action cannot be squared with the APA.”
According to Roberts, Chevron, as interpreted by Brand X, insists on more than the “respect” historically given to Executive Branch interpretations; it demands that courts mechanically afford binding deference to agency interpretations, including those that have been inconsistent over time, and even when a pre-existing judicial precedent holds that an ambiguous statute means something else, “That regime is the antithesis of the time honored approach the APA prescribes,” he wrote.
“Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority, as the APA requires,” Roberts concluded. “Careful attention to the judgment of the Executive Branch may help inform that inquiry. And when a particular statute delegates authority to an agency consistent with constitutional limits, courts must respect the delegation, while ensuring that the agency acts within it. But courts need not and under the APA may not defer to an agency interpretation of the law simply because a statute is ambiguous,” he added.
Concurring Opinions
Justice Thomas wrote a separate concurrence to underscore his long-standing view that Chevron deference also violates the U.S. Constitution’s Separation of Powers doctrine.
“Today, the Court places a tombstone on Chevron no one can miss,” Justice Gorsuch wrote in his 34-page concurrence. “In doing so, the Court returns judges to interpretive rules that have guided federal courts since the Nation’s founding,” he continued. Gorsuch wrote separately to explain his view on “why the proper application of the doctrine of stare decisis” supported this action.
Kagan’s Dissent
In her 33-page dissent, Justice Kagan wrote:
“Today, the Court flips the script: It is now ‘the courts (rather than the agency)’ that will wield power when Congress has left an area of interpretive discretion. A rule of judicial humility gives way to a rule of judicial hubris.
…
In one fell swoop, the majority today gives itself exclusive power over every open issue—no matter how expertise-driven or policy-laden—involving the meaning of regulatory law. As if it did not have enough on its plate, the majority turns itself into the country’s administrative czar. It defends that move as one (suddenly) required by the (nearly 80-year-old) Administrative Procedure Act. But the Act makes no such demand. Today’s decision is not one Congress directed. It is entirely the majority’s choice.”
White House Reaction
The White House issued a statement asserting that the decision was “yet another deeply troubling decision that takes our country backwards.” It added:
“The President has directed his legal team to work with the Department of Justice and other agency counsel to review today’s decision carefully and ensure that our Administration is doing everything we can to continue to deploy the extraordinary expertise of the federal workforce to keep Americans safe and ensure communities thrive and prosper.”