[co-author: Gabriel Blackloc]

On June 28, 2024, the Supreme Court issued a 6-3 opinion in Loper Bright Enterprises v. Raimondo removing the requirement that federal courts defer to agency interpretations on matters of law. ​This decision overrules the landmark case of Chevron v. NRDC, which established a legal framework whereby courts are required to defer to agencies’ interpretations of ambiguous statutes so long as they are “permissible.” In Loper Bright, the Supreme Court held that courts must instead exercise independent judgment when deciding whether an agency has acted within its statutory authority.

Holtzman Vogel attorneys filed three amicus briefs supporting plaintiffs and interested parties in this case:

• A brief by partner Drew Ensign and associates Ken Daines and Brennan Bowen on behalf of former state supreme court justices emphasized that an overhaul of Chevron would restore the judicial system to its proper role of deciding what federal law means without significantly disrupting the proceedings of government agencies and courts. This brief demonstrated that States have abolished Chevron-like deference without encountering meaningful disruptions.
• A brief by partner Jason Torchinsky on behalf of the New England Fishermen’s Stewardship Association argued that Chevron was used to uphold an agency’s interpretation of the law that was inconsistent with Congress’s intent. The brief also emphasized the practical hazards the fishing industry has faced due to the agency’s erroneous interpretation.
• A brief by partner Ed Wenger and associates Andrew Pardue and Ken Daines on behalf of the American Cornerstone Institute argued that Chevron is antithetical to the Constitution’s separation of powers. The brief emphasized that the legislative branch was designed to be deliberative, which Chevron undermines. Chevron was a misguided response to developments resulting from the New Deal.

Thus, in addition to having important implications for suits challenging the administrative state, Holtzman Vogel is pleased that the Loper Bright decision ended in victory for the party supported by each of these firm clients.

Background

In 1976, Congress passed the Magnuson-Stevens Act (MSA), which empowered the National Marine Fisheries Service (NMFS) to approve fishery management. The MSA specified that certain types of vessels were required to pay the costs of on-board monitors. Nothing in the Act, however, required Atlantic herring fishermen—the petitioners in Loper Bright—to pay these costs. In 2013, however, the NMFS promulgated a rule empowering regional councils to require Atlantic herring fishermen to pay for on-board monitoring in situations where no government-paid monitor was assigned. The estimated cost to an Atlantic herring vessel would be up to $710 per day, potentially reducing annual returns for fishermen by as much as 20 percent.

Four family businesses and two other vessel-owners in the Atlantic herring industry challenged the rule under the Administrative Procedure Act (APA), arguing that the MSA does not empower the NMFS to approve rules requiring payment of on-board monitoring costs. The D.C. Circuit ruled against the family businesses and in favor of the government, holding that the MSA did grant NMFS such power and, even if it didn’t do so unambiguously, Chevron doctrine required the court to defer to the agency’s interpretation of the MSA. The First Circuit similarly ruled against the two additional vessel-owners and in favor of the government, relying on Chevron doctrine. The Supreme Court granted certiorari to decide the question of whether Chevron is inconsistent with the APA and should be overturned.

The Supreme Court’s Decisions

The Court overruled Chevron, holding that (1) the APA requires courts to “exercise their independent judgment in deciding whether an agency has acted within its statutory authority,” and (2) courts “may not defer to an agency interpretation of the law simply because a statute is ambiguous.” Slip Op. at 35.

The Court began by recounting the historical development of agency deference. The Court noted that Article III of the Constitution makes federal courts responsible for deciding disputes between parties. The Framers were aware that the appropriate law to apply in a given dispute “would not always be clear,” yet they still determined that courts were best suited to interpret the law. Id. at 7. Early on in its history, the Supreme Court recognized that exercising independent judgment often involves “according due respect to Executive Branch interpretations of federal statutes.” Id. at 8. Judges were never bound by the legal interpretations of the Executive Branch, however. The views of the Executive “could inform the judgment of the Judiciary, but did not supersede it.” Id. 9. Even after the New Deal, deferential review of agency decisions was normally “cabined to factbound determinations,” not matters of law. Id. at 11.

The Court next discussed the APA. The APA codified “the unremarkable, yet elemental proposition reflected by judicial practice dating back to Marbury: that courts decide legal questions by applying their own judgment.” Id. at 14. It did this by specifying that courts must decide “all relevant questions of law” when reviewing an agency decision. Id. Courts may “seek aid” from agencies in determining statutory meaning, and they may in some cases determine that “the best reading of a statute is that it delegates discretionary authority to an agency.” Id. at 18. The kind of deference established in Chevron, however, is prohibited by the APA. Even in past decisions when the Court reiterated the justifications for Chevron, it had never “attempted to reconcile its framework with the APA.” Id. at 21. Since the Chevron framework requires courts to “ignore, not follow” the reading a court would have reached by applying its own reasoning, it contravenes the APA’s requirement that courts use their own judgment. Id. at 21. Moreover, Chevron cannot be reconciled with the APA by “presuming that statutory ambiguities are implicit delegations to agencies”; ambiguities are often unintentional, and the existence of ambiguity never relieves a court of its duty to determine the meaning of a statute. Id. at 21-22.

The Court also offered several critiques of Chevron’s logic:

• Agencies “have no special competence in resolving statutory ambiguities.” Id. at 23. The existence of agency “expertise” fails to justify Chevron’s application in “cases having little to do with an agency’s technical subject matter expertise.” Id. at 24. Even when “an ambiguity implicates a technical matter,” it doesn’t follow that Congress expected agencies to determine the matter, because “Congress expects courts to handle technical statutory questions.” Id.
• Chevron also fails to promote consistency due the inconsistent way it is applied. Id. at 25.
• The “view that interpretation of ambiguous statutory provisions amounts to policymaking suited for political actors” is flawed because “resolution of statutory ambiguities involves legal interpretation.” Id. at 26.
• The “many refinements” courts have made to Chevron in “an effort to match Chevron’s presumption to reality” are illustrations that the doctrine’s justifying presumptions are a fiction. Id. at 26-27.
• Stare decisis cannot save Chevron because its reasoning is flawed, experience has shown it to be unworkable, and it has not fostered meaningful reliance due to the Court's “constant tinkering with and eventual turn away” from it. Id. at 29-33.

The Court’s decision has significant implications for future challenges to agency actions. Because there is no longer a presumption that agency interpretations of law will bind the courts, suits challenging agency actions may be more likely to succeed.