On Friday, SCOTUS issued its decision in two very important cases, Loper Bright Enterprises v. Raimondo and Relentless, Inc. v. Dept of Commerce, about whether the National Marine Fisheries Service (NMFS) has the authority to require Atlantic herring fishing vessels to pay some of the costs for onboard federal observers who are required to monitor regulatory compliance. To be sure, the transcendent significance of these cases has little to do with fishing and everything to do with the authority of administrative agencies to regulate: the question presented to SCOTUS was whether the Court should continue the decades-long deference of courts, under Chevron U.S.A., Inc. v. Nat. Res. Def. Council, to the reasonable interpretations of statutes by agencies. The doctrine of Chevron deference mandates that, if a statute does not directly address the “precise question at issue” or if there is ambiguity in how to interpret the statute, courts must accept an agency’s “permissible” (think, “reasonable”) interpretation of a law unless it is arbitrary or manifestly contrary to the statute. In a majority opinion by Chief Justice John Roberts, the Court rejected the doctrine: the “deference that Chevron requires of courts reviewing agency action cannot be squared with the [Administrative Procedure Act].” In case you scoff at the significance of the decision, consider the seminal nature of the doctrine as described in this 2006 article by Cass Sunstein: Chevron “has become foundational, even a quasi-constitutional text—the undisputed starting point for any assessment of the allocation of authority between federal courts and administrative agencies. Ironically, Justice Stevens, the author of Chevron, had no broad ambitions for the decision; the Court did not mean to do anything dramatic. But shortly after it appeared, Chevron was quickly taken to establish a new approach to judicial review of agency interpretations of law, going so far as to create a kind of counter-Marbury for the administrative state.” Alluding to language from Marbury, Sunstein proclaimed that “Chevron seemed to declare that in the face of ambiguity, it is emphatically the province and duty of the administrative department to say what the law is.”  Not anymore. A six-justice majority of the Court has just overruled Chevron, with concurrences by each of Justices Clarence Thomas and Neil Gorsuch and a dissent by Justice Elena Kagan, joined by Justices Sonia Sotomayor and Ketanji Brown Jackson (only on Relentless). The implications of the decision are almost boundless—every current and future federal regulatory regime could be affected. As Kagan wrote in her dissent, this decision “puts courts at the apex of the administrative process as to every conceivable subject—because there are always gaps and ambiguities in regulatory statutes, and often of great import. What actions can be taken to address climate change or other environmental challenges? What will the Nation’s health-care system look like in the coming decades? Or the financial or transportation systems? What rules are going to constrain the development of A.I.?  In every sphere of current or future federal regulation, expect courts from now on to play a commanding role.”

Of course, this decision hardly comes as a surprise.  The conservative members of the Court have long signaled their undisguised enthusiasm to constrain the dreaded “administrative state,” especially when agencies are advancing regulations that conservative judges perceive as too “nanny state.” And overruling Chevron is one way to do just that.  For example, in his dissent in City of Arlington v. FCC in 2013, Roberts worried that “the danger posed by the growing power of the administrative state cannot be dismissed.” In his concurring opinion in the 2016 case, Gutierrez-Brizuela v. Lynch, Gorsuch referred to Chevron as an “elephant in the room” that permits “executive bureaucracies to swallow huge amounts of core judicial and legislative power.” And then there’s Justice Brett Kavanaugh’s 2016 article, Fixing Statutory Interpretation, in which he argues that Chevron is  “nothing more than a judicially orchestrated shift of power from Congress to the Executive Branch.” Again, in his concurring opinion in the 2019 decision of the Court in Kisor v. Wilkie (upholding, but limiting, Auer deference—that is, the deference of courts to the reasonable interpretations by agencies of their own ambiguous regulations), Roberts took pains to distinguish Chevron, emphasizing that “[i]ssues surrounding judicial deference to agency interpretations of their own regulations are distinct from those raised in connection with judicial deference to agency interpretations of statutes enacted by Congress…. I do not regard the Court’s decision today to touch upon the latter question.” Justice Brett Kavanaugh also agreed with Roberts with respect to the inapplicability of that case to Chevron. (See this PubCo post.) In recent past cases, SCOTUS has resolved issues without addressing Chevron, looking instead to theories such as the “major questions” doctrine. (See this PubCo post.) These two cases, however, presented that long-sought opportunity, and the impact of the decision will be felt far beyond the NMFS at many other agencies, including the SEC and the FDA. 

And it was clearly foreshadowed during the oral argument that SCOTUS was likely to jettison or at least significantly erode Chevron. Among the most conservative justices at least, there didn’t seem to be a lot of interest in half-measures—been there, done that.  (For summaries of the briefs and oral arguments, see this PubCo post.) Now that the Court has overruled Chevron, will we soon be seeing a dramatically different sort of administrative state?

Background

Both of these cases relate to interpretations by the NMFS of the Magnuson–Stevens Fishery Conservation and Management Act (MSA), first passed in 1976 to respond to the threat of “overfishing and the need for sound management of fishery resources.” The MSA governs marine fisheries management in U.S. federal waters and assigns responsibility for administration to the Secretary of Commerce, who has delegated administration to the NMFS, which is “charged with promoting the sustainability of the nation’s fisheries.” The MSA established eight regional councils that participate in the creation of fishery management plans, which, under the MSA, may require that observers be carried on board U.S. fishing vessels to collect data for the conservation and management of the fishery. The MSA specifies certain groups that must cover costs associated with observers and, in some cases, expressly caps the fees. But the MSA does not address “whether Atlantic herring fishermen may be required to bear costs associated with any observers a plan may mandate.” In 2020, the NMFS approved a final rule creating an industry-funded program ensuring a certain level of observer coverage. Under the rule, if “NMFS determines that an observer is required, but declines to assign a Government-paid one, the vessel must contract with and pay for a Government-certified third-party observer. NMFS estimated that the cost of such an observer would be up to $710 per day, reducing annual returns to the vessel owner by up to 20 percent.”

Arguing that the “MSA does not authorize NMFS to mandate that they pay for observers required by a fishery management plan,” a group of commercial fishing businesses, including Loper Bright and Relentless, challenged the authority of the NMFS to adopt the rule.   In both cases, the district courts granted summary judgment in favor of the Government, and the plaintiffs appealed. In Loper-Bright, a majority of a three-judge panel in the D.C. Circuit (where Justice  Jackson previously heard oral argument in this case, leading her to recuse herself) determined that there was “some question” as to Congressional intent and, proceeding to Chevron’s second step, deferred to NMFS’s reasonable interpretation of the statute. In Relentless, a three-judge panel of the First  Circuit also affirmed, concluding that the rule was “a permissible exercise of the agency’s authority and… otherwise lawful.” As the Court here observes, in “reaching that conclusion, the First Circuit stated that it was applying Chevron’s two-step framework….But it did not explain which aspects of its analysis were relevant to which of Chevron’s two steps. Similarly, it declined to decide whether the result was ‘a product of Chevron step one or step two.’”  On May 1, 2023, SCOTUS granted cert. in Loper Bright and, on October 13, granted cert. on the same question in Relentless, Inc. (presumably to allow Justice Jackson to participate in the decision): “[w]hether the Court should overrule Chevron or at least clarify that statutory silence concerning controversial powers expressly but narrowly granted elsewhere in the statute does not constitute an ambiguity requiring deference to the agency.” (For further discussions of the decisions of the two courts of appeal and of the petitions for cert. and responses, see this PubCo post and this PubCo post.)

Majority opinion

In essence, the majority concluded that Chevron was inconsistent with the Section 706 of the APA: under Section 706, as the majority read that provision, the interpretation of statutes and statutory ambiguities is the province, not of agencies, but of the courts, applying their independent judgment. (Of course, the dissent had a different interpretation. See below.) And further, stare decisis does not preclude the Court from overruling Chevron, which has been ”unworkable” and unreliable in its application.

As described by the majority, the “Chevron doctrine requires courts to use a two-step framework to interpret statutes administered by federal agencies. After determining that a case satisfies the various preconditions we have set for Chevron to apply, a reviewing court must first assess ‘whether Congress has directly spoken to the precise question at issue.’…If, and only if, congressional intent is ‘clear,’ that is the end of the inquiry….But if the court determines that ‘the statute is silent or ambiguous with respect to the specific issue’ at hand, the court must, at Chevron’s second step, defer to the agency’s interpretation if it ‘is based on a permissible construction of the statute.’”

The majority opinion began by reminding us that, under Article III of the Constitution, the Federal Judiciary has “the responsibility and power to adjudicate ‘Cases’ and ‘Controversies,’” and that the “Framers also envisioned that the final ‘interpretation of the laws’ would be ‘the proper and peculiar province of the courts.’…In the foundational decision of Marbury v. Madison, Chief Justice Marshall famously declared that ‘[i]t is emphatically the province and duty of the judicial department to say what the law is.’”  But the Court has also “recognized from the outset,…that exercising independent judgment often included according due respect to Executive Branch interpretations of federal statutes….’Respect,’ though, was just that. The views of the Executive Branch could inform the judgment of the Judiciary, but did not supersede it.”

Even as new agencies proliferated during the New Deal, the majority observed, “the traditional understanding that questions of law were for courts to decide, exercising independent judgment” continued to prevail. Although SCOTUS did often treat as binding well-supported agency determinations of fact, the majority wrote, it did not extend deference to agency resolutions of questions of law. SCOTUS did, however, give “great weight” to the “informed judgment of the Executive Branch,” particularly to interpretations contemporaneous with the enactment of the statute. In this context, the majority highlighted Skidmore v. Swift & Co., in which “the Court explained that the ‘interpretations and opinions’ of the relevant agency, ‘made in pursuance of official duty’ and ‘based upon . . . specialized experience,’ ‘constitute[d] a body of experience and informed judgment to which courts and litigants [could] properly resort for guidance,’ even on legal questions….‘The weight of such a judgment in a particular case,’ the majority observed, would ‘depend upon the thoroughness evident in its consideration, the validity of its reasoning, its consistency with earlier and later pronouncements, and all those factors which give it power to persuade, if lacking power to control.’”  On occasion, the “Court applied deferential review upon concluding that a particular statute empowered an agency to decide how a broad statutory term applied to specific facts found by the agency.”

As described by the majority, Congress enacted the APA in 1946 to rein in overly zealous administrators. The APA describes “procedures for agency action,” and “delineates the basic contours of judicial review of such action. As relevant here, Section 706 directs that ‘[t]o the extent necessary to decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action.’…It further requires courts to ‘hold unlawful and set aside agency action, findings, and conclusions found to be . . . not in accordance with law.’ The APA thus codifies for agency cases the unremarkable, yet elemental proposition reflected by judicial practice dating back to Marbury: that courts decide legal questions by applying their own judgment.”  The APA, the majority observed, prescribes no deferential standard on questions of law, even ambiguous laws.  By contrast, the majority highlighted, “Section 706 does mandate that judicial review of agency policymaking and factfinding be deferential.” By “directing courts to ‘interpret constitutional and statutory provisions’ without differentiating between the two, the majority reasoned, “Section 706 makes clear that agency interpretations of statutes—like agency interpretations of the Constitution—are not entitled to deference….The text of the APA means what it says.” A review of the APA’s legislative history and contemporaneous commentary, the majority concluded, “only underscores that plain meaning.” That doesn’t mean that, in exercising their independent judgment in determining the meaning of statutory provisions, courts may not “seek aid from the interpretations of those responsible for implementing particular statutes,” as they always have (citing Skidmore).  And, “of course, the statute’s meaning may well be that the agency is authorized to exercise a degree of discretion,”  in which case, “the role of the reviewing court under the APA is, as always, to independently interpret the statute and effectuate the will of Congress subject to constitutional limits.”

However, the majority concluded, Chevron does not square with the APA. The 1984 decision “triggered a marked departure from the traditional approach.” Chevron concerned an interpretation of the term “stationary source” as used in the Clean Air Act. In the decision, the now-familiar deference directive was justified “by the understanding that administering statutes ‘requires the formulation of policy’ to fill statutory ‘gap[s]’; by the long judicial tradition of according ‘considerable weight’ to Executive Branch interpretations; and by a host of other considerations, including the complexity of the regulatory scheme, EPA’s ‘detailed and reasoned’ consideration, the policy-laden nature of the judgment supposedly required, and the agency’s indirect accountability to the people through the President.”

Soon, the majority opinion continued, the courts were regularly invoking Chevron, and eventually, SCOTUS took the position that “Chevron rested on ‘a presumption that Congress, when it left ambiguity in a statute meant for implementation by an agency, understood that the ambiguity would be resolved, first and foremost, by the agency, and desired the agency (rather than the courts) to possess whatever degree of discretion the ambiguity allows.’”

But Chevron, the majority concluded, cannot be reconciled with the Section 706 of the APA, which requires “that ‘the reviewing court’—not the agency whose action it reviews—is to ‘decide all relevant questions of law’ and ‘interpret . . . statutory provisions.’… [Chevron] requires a court to ignore, not follow, ‘the reading the court would have reached’ had it exercised its independent judgment as required by the APA.” In effect, “Chevron turns the statutory scheme for judicial review of agency action upside down.”

The majority disagreed with the dissent’s contention that Chevron can be reconciled with the APA “by presuming that statutory ambiguities are implicit delegations to agencies….Presumptions have their place in statutory interpretation, but only to the extent that they approximate reality.”  According to the majority, there are many possible reasons for statutory ambiguities, including that they were unintentional. And even outside of agency interpretations, courts are often required to interpret statutory ambiguities. They don’t just throw up their hands, the majority reasoned; they  “use every tool at their disposal to determine the best reading of the statute and resolve the ambiguity….It therefore makes no sense to speak of a ‘permissible’ interpretation that is not the one the court, after applying all relevant interpretive tools, concludes is best. In the business of statutory interpretation, if it is not the best, it is not permissible.”

Most importantly, the majority maintained, Chevron is “misguided because agencies have no special competence in resolving statutory ambiguities.  Courts do.” Chevron “gravely erred” in its conclusion that the resolution of statutory ambiguities “is fundamentally different just because an administrative interpretation is in play.  The very point of the traditional tools of statutory construction—the tools courts use every day— is to resolve statutory ambiguities.  That is no less true when the ambiguity is about the scope of an agency’s own power—perhaps the occasion on which abdication in favor of the agency is least appropriate.”

The majority also took issue with the contentions of the Government and the dissent that Congress must have intended that agencies “resolve statutory ambiguities because agencies have subject matter expertise regarding the statutes they administer; because deferring to agencies purportedly promotes the uniform construction of federal law; and because resolving statutory ambiguities can involve policymaking best left to political actors, rather than courts.” But, the majority proposed, it just may be that some interpretive issues are more naturally within a court’s expertise.  The majority underscored this point at the end by challenging the dissent’s quote from Chevron that “‘Judges are not experts in the field.’…That depends, of course, on what the ‘field’ is.  If it is legal interpretation, that has been, ‘emphatically,’ ‘the province and duty of the judicial department’ for at least 221 years.” But even if the interpretation involves a technical matter,  “it does not follow that Congress has taken the power to authoritatively interpret the statute from the courts and given it to the agency.  Congress expects courts to handle technical statutory questions.” Judges can be informed by the expertise of the agency and amici, so delegation of interpretive authority to agencies is “simply not necessary to ensure that the resolution of statutory ambiguities is well informed by subject matter expertise.  The better presumption is therefore that Congress expects courts to do their ordinary job of interpreting statutes, with due respect for the views of the Executive Branch.” If it disagreed, the majority suggested, Congress can always revise the statute.

Nor, the majority reasoned, is there much value as a basis for deference, as the dissent suggested, “in imposing a uniform interpretation of a statute if that interpretation is wrong.” And, there are plenty of inconsistencies in the application of Chevron. Finally, the majority rejected the argument by the dissent that statutory interpretation amounts to policy making: courts “interpret statutes, no matter the context, based on the traditional tools of statutory construction, not individual policy preferences…. By forcing courts to instead pretend that ambiguities are necessarily delegations, Chevron does not prevent judges from making policy.  It prevents them from judging.” Of course judges are not part of political branches, the majority explained; rather, they “have always been expected to apply their ‘judgment’ independent of the political branches when interpreting the laws those branches enact….And one of those laws, the APA, bars judges from disregarding that responsibility just because an Executive Branch agency views a statute differently.”

According to the majority,  “Chevron’s justifying presumption is…a fiction,” and, as a result, the courts “have spent the better part of four decades imposing one limitation on Chevron after another,” creating procedural and substantive hurdles in an attempt “to match Chevron’s presumption to reality.”  This “byzantine set of preconditions and exceptions” has led some courts to bypass Chevron altogether, including SCOTUS, which “has not deferred to an agency interpretation under Chevron since 2016….The experience of the last 40 years has thus done little to rehabilitate Chevron. It has only made clear that Chevron’s fictional presumption of congressional intent was always unmoored from the APA’s demand that courts exercise independent judgment in construing statutes administered by agencies.”

But what about stare decisis?  Not a problem, says the majority.  Stare decisis “is not an ‘inexorable command,’… and the stare decisis considerations most relevant here—’the quality of [the precedent’s] reasoning, the workability of the rule it established, . . . and reliance on the decision,’…—all weigh in favor of letting Chevron go.” Chevron “has proved to be fundamentally misguided.”  It is a “‘rule in search of a justification,’” and “has launched and sustained a cottage industry of scholars attempting to decipher its basis and meaning.” The majority also believed that Chevron was “unworkable,” with no clear understanding of the meaning of statutory ambiguity, an all-too-malleable “defining feature of the framework.” The majority found the guide for ambiguity offered by the dissent—that “a court should reach Chevron’s second step when it finds, ‘at the end of its interpretive work,’ that ‘Congress has left an ambiguity or gap’”—to be “no guide at all.” This lack of definition has compelled the Court to “clarify the doctrine again and again.  Our attempts to do so have only added to Chevron’s unworkability, transforming the original two-step into a dizzying breakdance”—an “impediment, rather than an aid, to accomplishing the basic judicial task of ‘say[ing] what the law is.’”

The majority also contested the dissent’s argument that Chevron has “been the sort of ‘stable background rule’ that fosters meaningful reliance,” particularly in light of the Court’s “constant tinkering with and eventual turn away from Chevron, and its inconsistent application by the lower courts.” In the majority’s view, “[r]ather than safeguarding reliance interests, Chevron affirmatively destroys them.  Under Chevron, a statutory ambiguity, no matter why it is there, becomes a license authorizing an agency to change positions as much as it likes, with ‘[u]nexplained inconsistency’ being ‘at most . . . a reason for holding an interpretation to be . . . arbitrary and capricious.’” Accordingly, Chevron “has undermined the very ‘rule of law’ values that stare decisis exists to secure.”

Part of “judicial humility,” the majority professed, “is admitting and in certain cases correcting our own mistakes, especially when those mistakes are serious…. This is one of those cases.”  The way for the Court to fix the problem was “to leave Chevron behind.” Notably, the majority expressly declined to “call into question prior cases that relied on the Chevron framework.  The holdings of those cases that specific agency actions are lawful—including the Clean Air Act holding of Chevron itself—are still subject to statutory stare decisis despite our change in interpretive methodology.”

The majority concluded that “Chevron is overruled. Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority, as the APA requires.  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.”

Concurrences

Thomas. In his concurrence, Thomas wrote separately to highlight what he viewed as a more fundamental problem: that Chevron deference also violates the Constitution’s separation of powers by “curb[ing] the judicial power afforded to courts, and simultaneously expand[ing] agencies’ executive power beyond constitutional limits.”

Gorsuch. In his lengthy concurrence, Gorsuch wrote separately “to address why the proper application of the doctrine of stare decisis supports” the return of judges “to interpretive rules that have guided federal courts since the Nation’s founding.” Reiterating the sentiment he expressed in 2016 in his concurring 10th Circuit opinion in Gutierrez-Brizuela v. Lynch, he sought to minimize the potential fallout from overruling this precedent: “the Nation managed to live with busy executive agencies of all sorts long before the Chevron revolution began to take shape in the mid-1980s. And all today’s decision means is that, going forward, federal courts will do exactly as this Court has since 2016, exactly as it did before the mid-1980s, and exactly as it had done since the founding: resolve cases and controversies without any systemic bias in the government’s favor.”

Dissent

In her dissent, Kagan contested the majority’s interpretation that Chevron violates the APA, contending that the APA does not prescribe any standard of review. In addition, she reasoned, the presumption in Chevron that Congress wanted agencies to resolve statutory ambiguities makes good sense, given, among other reasons, agency subject-matter expertise. Overruling Chevron, she reasoned, which has been relied on for 40 years, will “cause a massive shock to the legal system.”

Kagan began her dissent by highlighting that, for 40 years, Chevron “has served as a cornerstone of administrative law, allocating responsibility for statutory construction between courts and agencies.” To her, the fundamental question that Chevron addressed is “[w]ho should give content to a statute when Congress’s instructions have run out? Should it be a court? Or should it be the agency Congress has charged with administering the statute? The answer Chevron gives is that it should usually be the agency, within the bounds of reasonableness.”  Chevron has been something of a watershed decision: “That rule has formed the backdrop against which Congress, courts, and agencies—as well as regulated parties and the public—all have operated for decades. It has been applied in thousands of judicial decisions.  It has become part of the warp and woof of modern government, supporting regulatory efforts of all kinds—to name a few, keeping air and water clean, food and drugs safe, and financial markets honest.”

And Chevron, she said, “is right.  This Court has long understood Chevron deference to reflect what Congress would want, and so to be rooted in a presumption of legislative intent.” Congress knows that the statutes it crafts will inevitably contain ambiguities and gaps that will need to be resolved by someone.  And Congress

“would usually prefer that actor to be the responsible agency, not a court.  Some interpretive issues arising in the regulatory context involve scientific or technical subject matter.  Agencies have expertise in those areas; courts do not. Some demand a detailed understanding of complex and interdependent regulatory programs. Agencies know those programs inside-out; again, courts do not. And some present policy choices, including trade-offs between competing goods. Agencies report to a President, who in turn answers to the public for his policy calls; courts have no such accountability and no proper basis for making policy. And of course Congress has conferred on that expert, experienced, and politically accountable agency the authority to administer—to make rules about and otherwise implement—the statute giving rise to the ambiguity or gap. Put all that together and deference to the agency is the almost obvious choice, based on an implicit congressional delegation of interpretive authority.”

But now, the majority  “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.”  And this is not the first time, she contended, that the Court has reallocated to itself “decision-making authority Congress assigned to agencies,” including OSHA, the EPA and the Department of Education. With this decision, 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.”

What’s more, she professed, “Chevron is entrenched precedent, entitled to the protection of stare decisis, as even the majority acknowledges.  In fact, Chevron is entitled to the supercharged version of that doctrine because Congress could always overrule the decision, and because so many governmental and private actors have relied on it for so long.  Because that is so, the majority needs a ‘particularly special justification’ for its action.” But, in her view, the majority provided ”nothing that would qualify.  It barely tries to advance the usual factors this Court invokes for overruling precedent.  Its justification comes down, in the end, to this: Courts must have more say over regulation—over the provision of health care, the protection of the environment, the safety of consumer products, the efficacy of transportation systems, and so on.  A longstanding precedent at the crux of administrative governance thus falls victim to a bald assertion of judicial authority.  The majority disdains restraint, and grasps for power.”

There are many reasons, she explained, that statutory gaps or ambiguities may arise: some may be intentional or the result of poor drafting, or a failure to reach compromise or even to foresee an issue.  To illustrate, Kagan ran through a series of real examples.  Here’s just one: when, under the Public Health Service Act, does an alpha amino acid polymer qualify as a particular protein and must it have a specific, defined sequence of amino acids?  In all of the examples she provided, the statutes were quite technical with more than one reasonable meaning.  Is that something the courts should decide? Sometimes Congress provided an “explicit instruction” assigning responsibility for the determination. But if not, then a “default rule,” a “presumption” was necessary.  Chevron provided that default: “[t]his Court has long thought Congress would choose an agency, with courts serving only as a backstop to make sure the agency makes a reasonable choice among the possible readings.” 

Why presume deference to an agency? Because the decision is “likely to involve the agency’s subject-matter expertise; to fall within its sphere of regulatory experience; and to involve policy choices, including cost-benefit assessments and trade-offs between conflicting values. So a court without relevant expertise or experience, and without warrant to make policy calls, appropriately steps back. The court still has a role to play: It polices the agency to ensure that it acts within the zone of reasonable options. But the court does not insert itself into an agency’s expertise-driven, policy-laden functions.” Recognizing that deference is not always appropriate, she wrote, the Court has tweaked the Chevron framework over time; these are not defects, as the majority suggested, but rather fine-tuning to “give interpretive primacy to the agency when—but only when—it is acting, as Congress specified, in the heartland of its delegated authority.”

To the contentions of the majority that “‘agencies have no special competence’ in filling gaps or resolving ambiguities in regulatory statutes; rather, ‘[c]ourts do,’” Kagan would “[s]core one for self-confidence; maybe not so high for self-reflection or -knowledge.” The expertise of a court in construing legal texts is employed in step one of Chevron, where a court seeks to determine what Congress meant in the statute; it’s only if the court cannot determine the meaning of a statutory term—“When does an alpha amino acid polymer qualify as a ‘protein’”?—that step two’s deference to agency expertise kicks in. “The idea” she contended, “that courts have ‘special competence’ in deciding such questions whereas agencies have ‘no[ne]’ is, if I may say, malarkey.”  Rather, it “is courts (not agencies) that ‘have no special competence’—or even legitimacy—when those are the things a decision calls for.”

She also challenged the contention of the majority that an ambiguity or gap doesn’t necessarily mean that Congress intended to give interpretive authority to an agency.  While she agrees that it doesn’t necessarily mean that authority was granted, her view requires more nuance. Rather, to Kagan, as discussed above, “Chevron is built on a presumption. The decision does not maintain that Congress in every case wants the agency, rather than a court, to fill in gaps. The decision maintains that when Congress does not expressly pick one or the other, we need a default rule; and the best default rule—agency or court?—is the one we think Congress would generally want….And as with any default rule, if Congress decides otherwise, all it need do is say.” The fact that Congress never makes a different assignment of interpretive responsibility, she contended, proves her point.

Kagan’s rejoinder to the majority’s principal argument—that about “80 years after the APA was enacted and 40 years after Chevron, the majority has decided that the former precludes the latter”—was that neither the APA nor the pre-APA state of the law was incompatible with Chevron. Citing several scholars, Kagan asserted that Section 706 of the APA “‘does not resolve the Chevron question.’” Rather, Section 706 “does not prescribe a de novo standard of review (in which the court starts from scratch, without giving deference). In point of fact, Section 706 does not specify any standard of review for construing statutes.”  If a court used a deferential standard, the “deferring court then conforms to Section 706 ‘by determining whether the agency has stayed within the bounds of its assigned discretion—that is, whether the agency has construed [the statute it administers] reasonably.’” The finest administrative law scholars of that time, she maintained, understood Section 706 to allow, even if not require, deference. Decisions by the courts prior to enactment of the APA tended to show deference to agency interpretation, she pointed out, albeit inconsistently and, following enactment of the APA, the Court never rejected the idea of judicial deference to agency interpretations. Neither “the text of Section 706” nor “contemporaneous practice, which that text was supposed to reflect” support the idea that Chevron violates Section 706. “So today’s decision has no basis in the only law the majority deems relevant. It is grounded on air.”

Even worse, Kagan argued, is the majority’s “subver[sion]” of stare decisis. In her view, “Chevron is entitled to stare decisis’s strongest form of protection. The majority thus needs an exceptionally strong reason to overturn the decision, above and beyond thinking it wrong. And it has nothing approaching such a justification, proposing only a bewildering theory about Chevron’s ‘unworkability,’” based on a lack of consistency about finding “ambiguity.” But “t[]here are ambiguity triggers all over the law. Somehow everyone seems to get by.” With regard to consistency, scholars have found that “Chevron has a ‘powerful constraining effect on partisanship in judicial decisionmaking.’…So if consistency among judges is the majority’s lodestar, then the Court should not overrule Chevron, but return to using it.” She also took issue with the majority’s contention that all of the “refinements” to the doctrine have made it unworkable. “For the most part,” she contended, “the exceptions that so upset the majority require merely a rote, check-the-box inquiry. If that is the majority’s idea of a ‘dizzying breakdance,’…the majority needs to get out more.” Plus, the “majority’s prescribed way of proceeding is no walk in the park. First, the majority makes clear that what is usually called Skidmore deference continues to apply….Under that decision, agency interpretations ‘constitute a body of experience and informed judgment’ that may be ‘entitled to respect.’… If the majority thinks that the same judges who argue today about where ‘ambiguity’ resides…are not going to argue tomorrow about what ‘respect’ requires, I fear it will be gravely disappointed.” And interpreting any delegation that Congress may intend is also a complex exercise.

For decades, she declared, Congress has had the opportunity to reject Chevron, but has not—even as some of the justices have questioned it. And Chevron is pervasive: SCOTUS itself has applied Chevron to defer to an agency interpretation at least 70 times, and the lower courts have done so thousands of times: “Chevron is as embedded as embedded gets in the law.”  

In overruling Chevron, the majority underscored that the Court has ignored Chevron recently, denigrating it as only a “decaying husk with bold pretensions.”  In response, Kagan countered that it was “alive and well” in the D.C. Circuit.  More importantly, Kagan applied a more skeptical eye to the Court’s recent avoidance of Chevron, viewing it as kind of a calculation: “The majority’s argument is a bootstrap. This Court has ‘avoided deferring under Chevron since 2016’ (ante, at 32) because it has been preparing to overrule Chevron since around that time. That kind of self-help on the way to reversing precedent has become almost routine at this Court. Stop applying a decision where one should; ‘throw some gratuitous criticisms into a couple of opinions’; issue a few separate writings ‘question[ing the decision’s] premises’ (ante, at 30); give the whole process a few years . . . and voila!—you have a justification for overruling the decision…. I once remarked that this overruling-through-enfeeblement technique ‘mock[ed] stare decisis.’…I have seen no reason to change my mind.”

Looking at the most important stare decisis factor, which Kagan called the “jolt to the legal system” issue, Kagan believed that it “weighs heavily against overruling Chevron…. Congress and agencies alike have relied on Chevron—have assumed its existence—in much of their work for the last 40 years.” Overruling Chevron “will cause a massive shock to the legal system, ‘cast[ing] doubt on many settled constructions’ of statutes and threatening the interests of many parties who have relied on them for years.” The majority, she wrote, tried to allay concerns by stating that “judicial decisions that have upheld agency action as reasonable under Chevron should not be overruled on that account alone,” but, she wonders, “how good is that assurance, really? The majority says that a decision’s ‘[m]ere reliance on Chevron’ is not enough to counter the force of stare decisis; a challenger will need an additional ‘special justification.’ ….The majority is sanguine; I am not so much. Courts motivated to overrule an old Chevron-based decision can always come up with something to label a ‘special justification.’ Maybe a court will say ‘the quality of [the precedent’s] reasoning’ was poor. Ante, at 29. Or maybe the court will discover something ‘unworkable’ in the decision—like some exception that has to be applied. Ante, at 30. All a court need do is look to today’s opinion to see how it is done.”

Stare decisis, Kagan explained, “is a ‘doctrine of judicial modesty.’… In that, it shares something important with Chevron. Both tell judges that they do not know everything, and would do well to attend to the views of others. So today, the majority rejects what judicial humility counsels not just once but twice over.” And this decision, Kagan observed, is hardly a one-off—her “own dissents to this Court’s reversals of settled law—by now fill a small volume.”

At its core, Kagan concluded, “Chevron is about respecting [an] allocation of responsibility—the conferral of primary authority over regulatory matters to agencies, not courts. Today, the majority does not respect that judgment. It gives courts the power to make all manner of scientific and technical judgments. It gives courts the power to make all manner of policy calls, including about how to weigh competing goods and values.” And, “[i]It puts courts at the apex of the administrative process as to every conceivable subject.” But this role was not one that Congress gave the courts, she wrote, “[i]t is a role this Court has now claimed for itself, as well as for other judges.” And “given Chevron’s pervasiveness,” the majority’s decision to overrule Chevron “is likely to produce large-scale disruption. All that backs today’s decision is the majority’s belief that Chevron was wrong—that it gave agencies too much power and courts not enough. But shifting views about the worth of regulatory actors and their work do not justify overhauling a cornerstone of administrative law. In that sense too, today’s majority has lost sight of its proper role.” 

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