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Loper Bright Enterprises v. Raimondo

Nos. 22-451 and 22-1219, 603 U.S. Supreme Court, 2024

Keywords: Chevron deference, agencies, stare decisis, statutory authority, ambiguity, independent judgment, agency’s action, judicial power, courts, regulation, statutory interpretation, overruling.

Summary

Private companies sometimes argue that the rules developed by federal agencies, such as the Equal Employment Opportunity Commission, Department of Justice, Department of Transportation, and the U.S. Access Board, are unenforceable and unconstitutional. 

Until this case, federal courts had ruled that federal agencies were allowed to explain or interpret federal rules. The federal agency could enforce its own rules even if the rules were unclear. This gave more power to the federal agencies, and when the rules were challenged, the agencies typically won. This ruling included agencies that provided services for persons with disabilities and made sure that their civil rights for were protected.

In the Loper case, fishing companies challenged a rule made by the National Marine Fisheries Service (NMFS) under the authorization of the Magnuson-Stevens Fishery Conservation and Management Act. Before now, courts relied on the Chevron Deference. In Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., courts had to defer to an agency’s reasonable interpretation of an “ambiguity” in a law that the agency enforces. An ambiguity means that something written in the law is unclear. The lower courts, using Chevron’s framework, ruled in favor of the NMFS.

The Supreme Court overruled the Chevron case, saying that the Chevron Deference conflicted with the Administrative Procedure Act and prevented courts from exercising the power given to them by Article III of the U.S. Constitution to say what the law is. The judgments were vacated, and the case was returned to the lower court.

Facts of the Case

In 1976, Congress passed the Magnuson-Stevens Fishery Conservation and Management Act (MSA), which aimed to manage fishery resources in United States waters. The MSA is administered by the National Marine Fisheries Service (NMFS) and the MSA also created regional fishery management councils, like the New England Fishery Management Council (NEC), that develop fishery management plans.

A plan may require fishing vessels to have federal monitors on board to enforce the agency’s regulations. The MSA lists three groups that must cover costs associated with these monitors but does not clearly require Atlantic herring fisheries to pay the costs of federal monitors. In the past, NMFS fully covered the costs of monitors, but the NEC changed its fishery management plans, making fishermen pay for their own observers.

Loper Bright Enterprises, H&L Axelsson, Lund Marr Trawlers, and Scombrus One are family businesses that operate in the Atlantic herring fishery. Relentless, Huntress, and Seafreeze Fleet own two ships that operate in the Atlantic herring fishery. They argued that the MSA does not allow NMFS to establish this rule requiring federal monitors.

Issues of the Case

  1. Should Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. be overruled or clarified?

Arguments and Analysis

1. Should Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. be overruled or clarified?

The lower courts applied Chevron’s two-step framework. Finding the MSA was not clear, the lower courts looked to NMFS’s “reasonable” and “permissible” explanation and ruled in favor of the Federal Government.

The Court traditionally held in Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. that when a statute was silent or unclear with respect to the specific issue at hand, a lower court had to defer to the federal agency if it had offered an allowable interpretation of the statute, even if it was different from how the court would have interpreted the rule.

In the Loper case, the U.S. Supreme Court ruled that agency interpretations of statutes are not entitled to the deference granted to them in Chevron.

The Court said that Chevron Deference conflicts with the Administrative Procedure Act (APA). Article III of the U.S. Constitution grants the courts the power to adjudicate cases and controversies. Also, the APA, which was enacted by Congress in 1946, is clear that courts decide all relevant questions of law for cases involving agency action, even when laws are ambiguous (or unclear). The APA offers no deferential standard for courts to use in answering those legal questions.

The Court ruled that Chevron was wrong in saying that the inquiry is basically differentjust because an administrative interpretation is used. The Court said Chevron’s presumption is wrong because agencies have no special competence in resolving statutory ambiguities, while courts do. With statutory ambiguities in cases that do not involve agency interpretations or delegations of authority, courts use tools of statutory construction to decide the best reading of the statute and resolve the ambiguity. While courts exercising independent judgment in determining the meaning of statutory provisions may ask for help from the agencies responsible for applying particular statutes, the role of the court under the APA is to independently clarify the statute and enforce the will of Congress subject to constitutional limits

Rulings

The Supreme Court ruled that the Administrative Procedure Act wants the courts to exercise their independent judgment in deciding whether an agency has acted within its statutory authority. Courts may not defer to an agency interpretation of the law simply because a statute is unclear.

The Supreme Court also ruled that simply because there is past legal practice the Courts do not have to uphold Chevron. Relevant stare decisis (previous judgements) considerations, including 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. Thus, Chevron is overruled.

Dissent and Conclusion

The dissent noted that, for forty years, Chevron has served as a cornerstone of administrative law that many governmental and private agencies have relied on. Chevron deference is rooted in a belief of legislative intent. Congress knows that it does not write perfectly complete regulatory statutes. It knows that those statutes will inevitably contain ambiguities and gaps that will have to be resolved, and it would usually prefer resolution is made by the responsible agency, not a court. Some interpretive issues arising in the regulatory context involve scientific or technical subject matter or demand a detailed understanding of complex and interdependent regulatory programs. Agencies are skilled in those issues and know those programs, while courts are not.

By overruling Chevron, courts will have the power to make decisions in areas where they lack the understanding agencies have in highly specialized, complex, and technical issues. This weakens the regulatory authority of federal agencies, including the Equal Employment Opportunity Commission (EEOC), Department of Justice (DOJ), and the U.S. Access Board. These agencies create rules and regulations filling in gaps in legislation, like the Americans with Disabilities Act, to protect disability rights. These may pertain to highly technical or scientific areas of the law with subjects outside the scope of legal training.

This decision will open the door for legal challenges to the rules and regulations issued by these agencies, which could limit federal regulations that safeguard the rights of people with disabilities. Additionally, it could impact issues which affect all Americans, but are particularly significant in disabled people’s lives, like healthcare, housing, or employment protections.

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These materials do not constitute legal advice and should not be relied upon in any individual case. Please consult an attorney licensed in your state for legal advice and/or representation. These materials were prepared by the legal research staff of the Burton Blatt Institute (BBI) at Syracuse University in partnership with the Southeast ADA Center to highlight legal and policy developments relevant to civil rights protections and the impact of court decisions in the Southeast Region under the Americans with Disabilities Act (ADA). These materials are based on federal disability rights laws and court decisions in effect at the time of publication. Federal and state disability rights law can change at any time.  In addition, state and local laws and regulations may provide different or additional protections. Materials are intended solely as informal guidance, and are neither a determination of your legal rights nor responsibilities under the ADA or other federal, state, and local laws, nor binding on any agency with enforcement responsibility under the ADA. The accuracy of any information contained herein is not warranted. Any links to external websites are provided as a courtesy and are not intended to nor do they constitute an endorsement of the linked materials.

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