Supreme Court’s Overruling of Chevron Deference Will Change How Regulations are Written and Interpreted

On June 28, in the Supreme Court case Loper Bright Enterprises v. Raimondo, a doctrine established in 1984 called the “Chevron deference” was overturned and will no longer be used when it comes to courts interpreting the meanings of regulations when there are ambiguities with them.  

The Chevron deference, named for Chevron USA, Inc. v. Natural Resources Defense Council, Inc. said that when there are ambiguities in an agency’s regulation, courts must defer to the agency to determine what’s meant by the regulation for that particular item being challenged.  With this ruling, courts will now have to independently interpret the regulation and determine what the best meaning of Congress was for that regulation.  Courts will get to use multiple sources to determine what the regulation means, not just what the agency who enforces it says it means.

The Reasoning for the Overturn

The court found the Chevron deference was inconsistent with the Administrative Procedures Act (APA).  This is the federal rule for how a regulation is written, how it’s entered into law, and how courts are to review actions by those agencies.  Chief Justice John Roberts wrote that the APA directs courts to “decide legal questions by applying their own judgment” and “makes clear that agency interpretations of statutes — like agency interpretations of the Constitution — are not entitled to deference.”  He also said the Chevron deference “allows agencies to change course even when Congress has given them no power to do so.” 

Justice Clarence Thomas also pointed out that the Chevron deference not only was inconsistent with the APA, but it also was inconsistent with the Constitution’s division of power.  This ruling keeps the power for interpretation in the hands of the Judicial Branch rather than deferring and giving the executive branch powers not given to it.

Justice Neil Gorsuch wrote, “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.”

Going Forward

The ruling also pointed out that just because a case used Chevron deference in the past, that wasn’t going to be a special justification to use for overturning it.  The Chevron deference has been used 18,000 times.  However, it’s predicted most regulations, especially those with long standing, will remain intact unless challenged for a different reason. 

However, we’ll likely see much more dramatic changes in how new regulations are written. 

Congress will retain the ability to delegate authority to federal agencies but will now need to clearly define the scope of that authority and give explicit directions in new regulations.  Broad, vague grants of authority will not be in the agency’s favor going forward.  We’re likely to see more clear and detailed statutory language.  We may also find that agencies start updating existing regulations to shore up the language in them.  Justifications will need to be clearer and need to give both their purpose AND their statutory basis.

In the Immediate Future

As a result of this case, we anticipate agencies may want to flex their authority by trying to assert current regulations.  Because current regulations need to be challenged for something other than the Chevron deference, it may be harder to challenge current regs.  

Another scenario is that agencies may also want to purposely try to get their regulations challenged just so that they know where they stand legally. As a result, we may see more inspections.