Supreme Court Overturns Chevron Deference

On June 28, the Supreme Court ruled 6 – 3 to overturn Chevron Deference, in a serious blow to rule-writing federal agencies. The Court’s decision will have a significant effect on agencies’ ability to make regulations and exposes agency rules to judicial scrutiny.

The Chevron doctrine gave federal agencies the power to interpret their own rules against legislated statutes when disputes arose. The doctrine essentially granted judge status to agencies, which otherwise would have been defendants in legal disputes. It also stacked the deck against citizens who brought complaints against the agencies because the agencies could interpret the statutes in a way most favorable to themselves.

Prior to the Chevron decision in 1984, authority to interpret laws was the exclusive power of the judiciary, as defined in the Constitution.  

Locally, the decision will have a chilling effect on environmental regulations made by the Department of Interior and the Department of Agriculture, which administers Forest Service lands.

Chevron Killed by Fishers

The case that finally took the 1984 Chevron doctrine to its demise was brought by New Jersey-based fishing company Loper Bright Enterprises and other fishers operating off the coasts of New England. Fishing herring in the Atlantic is regulated by The National Marine Fisheries Service (NMFS). The NMFS required fishing vessels to carry a paid federal observer to prevent overfishing. 

In 2013, concerned about lack of funding, the NMFS council amended its fishery management plan to empower itself “to require fishermen to pay for observers if federal funding became unavailable,” according to the Court’s opinion. The cost to fisherman to board an observer was set at $710 a day.

Loper argued (in 2020) that the Magnuson-Stevens Fishery Conservation and Management Act (MSA) did not give the NMFS authority to require fishers to pay to be regulated. 

Both the District Court and the D.C. Circuit sided with the government, concluding that because the MSA was silent on the issue, the Court was required to “defer” to the agency’s interpretation under Chevron. 

But in June, the Supreme Court killed Chevron once and for all.

The Court’s Reasoning

In 1984, Chevron v. NRDC  “seemed destined to obscurity,” wrote Thomas D. Merrill of Columbia Law School. But it proved instead to be a watershed decision cited in many cases involving agency authority. In fact, Westlaw reports that since then, Chevron has been cited in nearly 100,000 documents, including more than 18,000 federal court decisions.

Chevron ignored the Administrative Procedures Act (APA) of 1946, which was Congress’s attempt to keep the Administrative State in check after it grew substantially following the New Deal. 

Congress in 1946 enacted the APA “as a check upon administrators whose zeal might otherwise have carried them to excesses not contemplated in legislation creating their offices,” the Court wrote in Morton Salt Co. (1950). And in the current case, Loper, the Court quoted Chief Justice Marshall in Marbury (1803) that “[i]t is emphatically the province and duty of the judicial department to say what the law is.”

Chevron turned that precedent on its head, turning the job of interpretation over to the federal agencies. It traded the judiciary’s interpretation role specified under APA, for a two-step process to trigger “deference” of the decision to the agency. For the Court to defer to the agency’s interpretation, the statute in question first needed to be “ambiguous” and second, the court needed to decide whether the agency’s rule was “permissible” (reasonable).

The Court noted that because “ambiguity” has never been well-defined, Chevron is “unworkable” as a legal doctrine. “Chevron has proved to be fundamentally misguided,” the Court wrote. “By forcing courts to instead pretend that ambiguities are necessarily delegations [to agencies], Chevron does not prevent judges from making policy. It prevents them from judging.”

The Court concluded that Chevron (as a Court decision) could not be squared with the APA (which is actual legislation).

Justices Kagan, Sotomayor, and Jackson dissented from the majority opinion in Loper, however.

“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,” Justice Kagan wrote. “As if it did not have enough on its plate, the majority turns itself into the country’s administrative czar.”

“The majority disdains restraint, and grasps for power,” the Dissent read.

That power to interpret, however, was granted to the judiciary by the Constitution and remained so until 1984. 

Chief Justice Roberts disputed Kagan’s opinion that administrative rules were too technical for the Court to interpret, stating that the Court’s “field” is not writing policy (as is the agency) but in legal interpretation of those rules against actual, legislated statute.

“Congress expects courts to handle technical statutory questions,” Roberts wrote, and then quoted Justice Breyer in Egelhoff (2001): “[M]any statutory cases” call upon “courts [to] interpret the mass of technical detail that is the ordinary diet of the law.”

Roberts argued that even though this decision (Loper) overturns Chevron, it was not a signal that the courts would forevermore ignore agency interpretations. While the judiciary held the solemn duty of interpreting laws, they also paid respectful consideration to the federal agency interpretations of the laws simply because those officers were “able men, and masters of the subject,” he wrote, quoting Moore (1878).

“’Respect’, though, was just that,” Chief Justice Roberts wrote. “The views of the Executive Branch [agency] could inform the judgment of the Judiciary, but did not supersede it.” 

The Decision’s Effect

Following Chevron, federal agencies will still be able to make administrative rules as they have for decades, but now they will come under greater scrutiny by courts. When lawsuits are filed against agencies, courts will no longer be bound to defer decision-making to the agency, but will have to judge the matter as an independent judiciary. 

Now, courts will be the final arbiter of whether any administrative rule is in compliance with legislated statute. And federal agencies will have to return to their seat as a defendant rather than as a judge.

Reaction to the Supreme Court’s decision last month has included praise from conservatives and condemnation from liberals. The decision will affect all federal agencies from financial agencies to healthcare regulators, but most liberals have focused their concerns toward its effect on environmental policy.

Jake Bittle & Zoya Teirstein, writing for environmental justice media company Grist, said overturning Chevron will hamper the fight against climate change. “It could allow for far more legal challenges against regulations by agencies like the EPA and the Department of the Interior that have a huge role in the climate fight,” they wrote.

The effect of removing Chevron wouldn’t be small either. Grist pointed out that in an analysis of 1,500 circuit court decisions, courts applied Chevron in 77% of regulatory disputes, which substantially increased the government agency’s chance of winning these cases. Now, agencies will no longer be able to rely on Chevron. 

Swati Sharma, Editor-in-Chief for Vox, argued that the conservative Supreme Court has just “put themselves in charge of everything” in what she called a “veto power.”

“We can only hope that this Court won’t do something so stupid,” Sharma wrote.

Utah politicians applauded the decision, with some calling Chevron the cause of so much federal overreach through the Administrative State. 

“Goodbye Chevron deference, hello again, Constitution!” tweeted Utah Senator Mike Lee. “Unelected bureaucrats cannot make the law, and our courts can once again protect the American people from them.”

Earlier in June, ahead of the Court’s decision, Hannah Seariac of Deseret News wrote a piece discussing Chevron Deference, mostly in the context of environmental policy and public lands. It seemed that some people she interviewed, including politicians and pundits, didn’t quite understand the significance of Chevron. 

Devin Ombres of Center for American Progress told Deseret News that fighting against the administrative state was fighting against hardworking Americans who give up lucrative careers in favor of public service. He added, “Getting rid of Chevron is going to limit all of the protections that you have.”

Seariac wrote, “When asked whether or not Chevron deference prevents the courts from checking the power of bureaucracies, Ombres said he thinks Chevron deference actually acts as a check on the court system.”

First of all, the Administrative State does not exist for the benefit of its employees. Second, “bureaucracies” do not have any constitutional authority to keep the courts in “check.” The balance of federal power rests solely between the Executive, Legislative, and Judicial branches of government.

Adding to the impression that most people don’t understand Chevron, Seariac’s article received over 120 comments, about half of which lambasted the idea of turning federal public lands over to state control. That has nothing to do with the Supreme Court overturning Chevron.

– by AJ Martel, The Byway

Feature image caption: A fishing vessel cruises through Middle Thorofare Toll Bridge in Cape May at New Jersey’s most southern tip. The vessel is operated by Lund Marr Trawlers, one of the petitioners in the Loper case that brought Chevron Deference to an end. Courtesy of LoperBrightCase.

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Read more about how the Administrative State affects local politics in Administrative State.