Chevron Deference – Waiting on the Court 

The U.S. Constitution is very clear in assigning Congress the power to write laws, assigning the Executive Branch the power to enforce those laws, and assigning the Judicial Branch the power to interpret those laws. As the reach of the federal government has grown to encompass a growing range of activity in an increasingly complex nation, administration of much of federal law is placed in the hands of regulatory agencies who are charged by Congress to craft and enforce regulations implementing the statutes which Congress enacts. A key legal principle enabling federal agencies to fulfill this role is “Chevron Deference”  

Background 

What we now refer to as Chevron Deference is named for a 1984 Supreme Court case – Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. which challenged the U.S. Environmental Protection Agency’s (EPA’s) interpretation of certain provisions of the Clean Air Act. The court’s ruling set up a two-part test for challenging an agency’s interpretation of a statute enacted by Congress. 

1. If the agency’s interpretation is consistent with clear language in the statute, it cannot be challenged. 
2. If the statutory language is unclear or ambiguous, courts are to defer to the agency’s interpretation provided that it is reasonable; the agency’s interpretation is not required to be the only possible interpretation, but it does need to be a reasonable interpretation. In taking this position, the court has decided to defer to the technical expertise of agency staff and not require judges to make decisions on detailed technical matters outside of their expertise. 

The primary implication of Chevron Deference is that parties challenging agency interpretations of statute have a burden of proof that the agency’s interpretation is clearly contrary to statute.  

Proponents of Chevron Deference argue that it is the most reasonable way to enable technical experts employed by the agencies to make the key judgement calls needed to craft regulations which provide regulated parties with required clarity. Opponents of Chevron Deference argue that it represents an unconstitutional transfer of power from Congress and the Courts to the Executive Branch and that Congress should be expected to craft statutes which are clear and adequately detailed. 

Current Case 

The Supreme Court is currently considering a pair of cases related to the Chevron Deference principle –  Loper Bright Enterprises v. Raimondo and Relentless, Inc. v. U.S. Department of Commerce. Both of these cases challenge a regulation issued by the National Marine Fisheries Service (NMFS)1 requiring fishing vessels to pay the salaries of federal observers which they are required to carry under provisions of the Magnuson-Stevens Act (MSA). The plaintiffs in these cases argue that this requirement exceeds the agency’s statutory authority under MSA; the court hearing the case applied Chevron Deference in ruling for the NMFS.  

The Supreme Court heard oral arguments on these cases on January 17, 2024 and is expected to issue their ruling prior to adjourning for the summer. Broadly, there are three potential outcomes for this case: 

1. The Court could affirm the ruling of the trial court; this would retain status quo on Chevron Deference; 
2. The Court could issue a narrow ruling on why facts specific to this case place it outside the scope of Chevron Deference; such a ruling would have limited impact on other cases; or 
3. The Court could decide that Chevron Deference is an unconstitutional departure from the separation of powers established by the constitution; such a ruling would have potentially wide-spread implications for all matters subject to federal regulations. 

What if the Court overrules Chevron Deference? 

If the Court decides to eliminate or significantly restrict application of Chevron Deference, the following activities can be expected – 

1. Parties who have lost challenges to agency actions due to trial courts applying Chevron Deference can be expected to appeal those rulings. 
2. Parties who have been cited for regulatory violations may choose to go to court challenging the agency’s interpretation of statute. 
3. Regulated parties and public interest groups will increase their challenges to proposed regulations based on differing interpretations of statutory language. 
4. Agencies may be required to revise regulations following court determinations against their interpretation of statute. 
5. Congress will need to write statutes which are more specific and detailed to assure implementation of their intent. This may require an increase in Congressional staffing, particularly with respect to more technical expertise on committee staffs, and will increase the time required for Congress to craft new statutes in response to emerging issues.