Keerthi Chalamalasetty
Edited by Atreyee (Jiya) Ghosh, Sahith Mocharla, and Jia Lin
I. Introduction
On a sultry summer day along the rugged Atlantic coast, a group of New Jersey fishermen are working tirelessly, casting their nets and hauling their newest catch of herrings. The ocean breeze drifts through the serene landscape as the propellers of the boats begin to create a deep, rhythmic thrum. The ocean’s vast surface gleams with sunlight as the breeze continues to buffet its rhythmic waves. Yet, amidst attempting to catch Atlantic Herrings, the fishermen are struck with the deep, interconnected webs of bureaucratic red tape. It appears that a new regulation imposed by the National Marine Fisheries Service (NMFS) mandates industry participants to pay $710 per day to the NMFS to continue funding at-sea monitoring programs. Struck by this enormous cost, the group of fishermen, who are a part of Loper Bright Enterprises, decide to sue the National Marine Fisheries Service, a division within the U.S. Department of Commerce. Loper Bright Enterprises argues that the new regulation is unlawful and is in direct violation of the Magnuson-Stevens Fishery Conservation and Management Act of 1976, which does not authorize the fishermen to pay for federal monitors [1]. The fishermen’s fight set off a small ripple in 2020, which four years later turned into a tidal wave, culminating in the overturning of the landmark Chevron Doctrine. This seismic shift marks one of the most consequential Supreme Court decisions of the twenty-first century, as it modifies the forty year old precedent established by Chevron Deference, altering the state of administrative law as American society knows it [2].
Chevron Deference is a doctrine of judicial deference that stems from the 1984 Supreme Court Case Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., in which the Supreme Court held that a court should defer to a federal agency’s interpretation when encountered with an ambiguous statute as long as the agency’s interpretation is considered to be reasonable [3]. For the past forty years, the Chevron Doctrine has been central to administrative law, as it has been cited by federal courts more than 18,000 times [4]. The overturning of this doctrine was brought about in 2024 with the Loper Bright Enterprises v. Raimondo case, in which the Supreme Court held that under the Administrative Procedure Act, the courts must utilize their independent judgment to determine whether an agency has acted within its statutory authority; additionally, the courts must no longer defer their ability of judgment to an agency’s interpretation of an ambiguous statute. These two arguments–in conjunction–thereby overrule the previously established Chevron doctrine [5]. The end of Chevron deference marks a significant shift in the intricate relationship between the judiciary and administrative agencies, further signaling a move towards a more independent judiciary empowered in its role to exercise its judgment when interpreting ambiguous statutory provisions. Additionally, this ruling challenges the overreach of executive authority in regulatory matters, handing the power back to the courts when it comes to interpreting the law. Therefore, striking a balance between the branches of government in the United States of America.
II. The Rise of Chevron Deference: The Shift from the Courts to Regulatory Agencies
The establishment of Chevron deference makes its way back to the New Deal era (1930s), when there was a substantial increase in the number of federal agencies. As a result of these increasing numbers of federal agencies, there was a bipartisan effort to spearhead support for the passage of the Administrative Procedure Act (APA) in 1946 to determine the scope of the new ‘administrative state’ [6]. The Administrative Procedure Act established the way that federal agencies can create and enforce regulations [7]. Most notably, Section 706 of the Administrative Procedure Act established judicial review for interpreting an agency’s action and set up three standards for appellate review [8]. First, an agency’s findings can be set aside by the courts only if they are clearly false. Next, if the agency has mixed interpretation on the facts and the law, it could be set aside as a form of intermediate deference as there is no substantial evidence to support it. In addition, the subject matter of the law was subject to “de novo” (without precedent–began anew) review dependent entirely on the persuasiveness of an agency’s action [9]. Most importantly, Section 706 of the APA allowed the courts to ensure that the regulatory agencies do not exceed their authority and that their decisions are logically sound. While this provides a broad framework for establishing the authority of the courts when interpreting the actions of the regulatory agencies, it was not until forty years later–after the establishment of this act–that a narrower scope of how courts ought to interpret ambiguous statutes arose. Primarily, in the 1984 Supreme Court Case, Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., the Supreme Court formulated the Chevron doctrine as a form of judicial deference to defer judgment onto regulatory agencies when faced with an ambiguous statute, as long as the regulatory agency’s interpretation is reasonable. The case was granted on May 31, 1983, and oral arguments were heard almost a year later on February 29, 1984. The advocates were Paul M. Bator, the Deputy Solicitor General during the Reagan administration, on behalf of the petitioner and David D. Doniger, an attorney for the National Resources Defense Council, on behalf of the petitioner. The facts of this case surround the Clean Air Act and its requirement for states to establish a permit program in efforts of regulating modified or new crucial stationary sources of pollution if the state had not yet achieved its national air quality standards [10]. However, during President Ronald Reagan’s administration, the Environmental Protection Agency (EPA) in 1981 postulated that a state that did not meet the national air quality standards could adopt a plant-wide definition of the term “stationary source,” meaning that the state could utilize an existing plant with multiple pollution-emitting devices and modify one of the pieces without the need for a permit. This was permissible as long as the modification did not result in a net increase in the total amount of emissions from the plant. The EPA’s interpretation came to be known as the “bubble concept” because its regulation allows for the states to view all of the objects within a single plant as being enclosed within a “bubble.” However, since the Clean Air Act did not have a clear definition of a “stationary source” and the EPA’s interpretation of a “stationary source” was similar to a whole plant instead of the multiple parts inside of it, the Natural Resources Defense Council challenged the interpretation in front of the court [11]. As a result, the main question that came before the court considered whether the Clean Air Act allowed for the EPA to define “statutory source” as meaning whole industry plants [12]. On June 25, 1984, the court issued a unanimous decision, with Justice John Paul Stevens authoring the majority opinion, that the bubble regulation was a reasonable interpretation of the Clean Air Act’s “statutory source” provision. The court’s decision was two-fold, as it first recognized that Congress did not have a specific intent when it defined “statutory source.” Secondarily, the court held that since the EPA’s interpretation of “statutory source” was reasonable, the courts did not need to construe its own interpretation and exercise judicial deference onto the regulatory agencies as long as their interpretation was reasonable [13]. The decision can be simplified using a two-step test that came out of the Supreme Court case when one needs to evaluate whether the utilization of judicial deference is appropriate in a given circumstance.
The Two-Step Test:
1) Inquiring about the clarity of the statutory provision
2) If the statutory provision is unclear, the court then defers to the interpretation of the agency
The first step ensures that the court deciphers whether Congress has addressed the issue at hand with clarity. If the statue is clear and unambiguous, then the court must defer to Congress. However, if the statue is unclear and ambiguous, then the court must defer to an agency’s interpretation as long as the agency’s interpretation is reasonable. This decision was also based on taking an agency’s expertise into account. Hence, the decision paved the path to the establishment of Chevron deference in the landscape of administrative law. For many years, proponents of the Chevron doctrine have argued that judicial deference is necessary, as it allows for regulatory agencies to operate more effectively as they are typically to be the experts on the issue. At the time of the ruling, proponents argued that the “lower federal courts were inappropriately crafting policy by deciding for themselves what certain laws meant, effectively substituting their own ideas for the discernment of agency experts” [14]. However, opponents of the deference who sought to overturn the doctrine have argued that it damages the separation of powers between the three branches of government and allows for regulatory agencies to overstep their bounds and impose unlawful rules and restrictions [15]. Consequently, this undermines the role of the judicial branch by subverting its constitutional responsibility of interpreting the law. Additionally, opponents also argue that this form of judicial deference places massive amounts of power into the hands of unelected bureaucrats. With this tension in hand, the Chevron doctrine remained at the forefront of administrative law for decades until its demise forty years later.
III. The Fall of Chevron Deference: The Shift Away from the Regulatory Agencies to the Courts
The overruling of the Chevron doctrine returned power to the courts when interpreting ambiguous statutes rather than deferring to an agency’s interpretation. From challenging the unlawful implementation of the $710 daily fee from the National Marine Fisheries Service to overturning Chevron deference, the 2024 Supreme Court Case Loper Bright Enterprises v. Raimondo, dramatically altered U.S. administrative law. The case was granted on May 1, 2023, and oral arguments were heard almost a year later, on January 17, 2024. On June 28, 2024, the court issued a 6-2 majority decision in which it overturned the 1984 Supreme Court Case, Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., thereby also overruling the utilization of Chevron deference in the landscape of administrative law. The Supreme Court held that under the APA, courts must exercise their constitutional right of independent judgment when deciding if an agency has acted within its statutory authority rather than deferring to an agency’s reasonable interpretation of a statute due to its ambiguity [16]. The advocate for the petitioner was Paul D. Clement, a highly seasoned appellate lawyer who served as the 43rd Solicitor General of the United States from 2004 to 2008 [17]. The advocate for the respondent was Elizabeth B. Prelogar, the 48th Solicitor General of the United States [18]. When deciding Loper Bright Enterprises v. Raimondo, the court issued a joint decision along with Relentless, Inc. v. Department of Commerce, another Supreme Court case that shared the objective of challenging the existence of the Chevron doctrine. Both cases posed similar questions about the validity of deferring authority to administrative agencies to interpret ambiguous statutes. Additionally, both cases challenged the fishing rule for funding sea-monitoring programs formulated by the NMFS under the Magnuson-Stevens Act [19]. This newly formulated rule required fishing companies to bear the costs of funding at-sea monitoring programs. More specifically, it required fishing vessels to carry observers onboard to collect data for the purpose of environmental conservation and bear the costs for the at-sea monitoring programs at $710 per day. This case was first decided under the jurisdiction of the District Court for the District of Columbia Circuit and then made its way to the First Circuit Court of Appeals, where both the district and the appellate court upheld NMFS’s rule as it had been in line with the Chevron doctrine. The courts argued that since the Magnson-Stevens’ act was unclear and ambiguous, the court had to defer to the interpretation of the agency [20]. However, the case made its way to the Supreme Court of the United States and was overruled. In addition to the authorization question under the Magnuson-Stevens Act, the Court was faced with the question of whether it ought to overturn Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. If not overturned, should it at least clarify whether ambiguous statutes on controversial matters require judicial deference to the agencies? In response to these questions, the Supreme Court reversed the lower court's decision and overturned Chevron deference by instituting that the court must have the ability to determine whether an agency has acted within its statutory authority rather than deferring their ability to pass on independent judgment [21]. More specifically, in the majority opinion, Chief Justice John Roberts claimed that “perhaps most fundamentally, Chevron’s presumption is misguided because agencies have no special competence in resolving statutory ambiguities. Courts do” [22]. Roberts’ main argument seems to rely on the fact that the Chevron doctrine is predicated upon on this false premise that judicial deference to regulatory agencies is beneficial due to the expertise that bureaucrats carry in resolving statutory ambiguities. However, it becomes evident that it is the role of the judges to interpret statutory ambiguities rather than the role of bureaucrats. Additionally, Justice Roberts argues that the prevalence of the doctrine forces the “courts to . . . pretend that ambiguities are necessarily delegations, Chevron does not prevent judges from making policy. It prevents them from judging” [23]. Hence, the problem with the Chevron doctrine arises from subverting the responsibilities of the judicial branch onto the regulatory agencies. Apart from the practicability of Chevron’s utilization, the opinion lists that it is declared in Marbury v. Madison that “[i]t is emphatically the province and duty of the judicial department to say what the law is.” [24] Therefore, emphasizing the importance of checks and balances between the different branches of government and bringing the power to the judiciary when it comes to interpreting the law. The opinion makes it clear that it is the job of the judges to evaluate statues and not the job of the agencies to insert their own interpretation when it comes to ambiguous statues.
In Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., the principle of judicial deference in the context of the Chevron Doctrine allowed for agencies to use their expertise and interpret ambiguous statutes if Congress had not particularly addressed the nature of the statute. However, the recent overruling of the doctrine in Loper Bright Enterprises v. Raimondo allows courts to have more power in interpreting complicated legal statutes. This power indicates the rise of far more judicial involvement in the interpretation of complex and ambiguous legal statutes. Additionally, it also allows the courts to have a stricter oversight of the actions taken by these agencies. The contemporary legal issue of judicial deference is compelling due to the dual nature of the issue. On one hand, it seems intuitive that the judiciary department is the one with the power of judgment, and it ought to be the courts that pass down judgments on legal statutes. The principle of judicial review, as established in Marbury v. Madison, establishes the role of the courts as the arbiters of determining the constitutionality of the law. However, proponents of the doctrine argue that expertise of the bureaucrats in regulatory agencies is necessary when faced with ambiguous statutes with unclear Congressional intentions. In Justice Elena Kagan’s dissent, she writes that the matter of expertise is significant when encountering the issue of overturning Chevron deference. She argues that “agencies have expertise in those areas; courts do not. Some demand a detailed understanding of complex and interdependent regulatory programs. Agencies know those programs inside-out; again, courts do not. And some present policy choices, including trade-offs between competing goods. Agencies report to a President, who in turn answers to the public for his policy calls; courts have no such accountability and no proper basis for making policy” [25]. Kagan’s argument is the opposite of Roberts’ majority opinion and rests on the issue of expertise the courts lack when it comes to complex issues that the regulatory agencies are better suited for. This disagreement is the nexus of the issue of whether Chevron deference was rightfully established or overturned. The nuance of the issue lies in the complexity of prioritizing expertise or the inherent constitutional right to interpret the law. The tension between these perspectives reflects the ever-evolving struggle for separation of powers between the legislative, executive, and judicial branches of government in the legal and regulatory landscape.
IV. Conclusion
For the past forty years, the Chevron doctrine has empowered agencies to exercise their expertise on the matter due to the pre-existing ambiguity of the law. The reasoning being that the courts do not always know the intricacies of the law pertaining to specific regulatory functions of an agency. However one might interpret the legal issue, expertise, or constitutional duty, the complexity of the issue is fascinating and requires more nuance to ascertain whether or not the Chevron doctrine was necessary for maintaining the balance of power between the courts and the agencies. It is also important to note that the decision has created tension between the judiciary and the administrative agencies as the issue of power comes into play. The impact of the decision is undeniable, as it will restructure the power that agencies have had in terms of interpreting legal statutes for the past forty years. Moreover, constitutional issues arise, as the separation of powers and the principle of checks and balances–both now under some interpretation–are the foundation of this nation. How one might interpret the issue is distinct, but the nexus of judicial deference and whether it is just or unjust for courts to defer their power is highly prevalent in today's legal landscape. All in all, the issue of judicial deference is a complicated one and contains a lot of factors in determining whether it is a just principle. One must not look for a simple yes or no answer, but instead aim to understand the complexities of the issue to gain a better grasp on the matter of what truly sustains a balance of power between the different branches of the United States federal government.
[1] Loper Bright Enterprises v. Raimondo, Oyez, https://www.oyez.org/cases/2023/22-451
[2] Supreme Court strikes down Chevron, curtailing power of federal agencies, SCOTUSblog (Jun. 28, 2024), https://www.scotusblog.com/2024/06/supreme-court-strikes-down-chevron-curtailing-power-of-federal-agencies/
[3] Chevron deference, LII / Legal Information Institute, https://www.law.cornell.edu/wex/chevron_deference
[4] See [2], Supreme Court strikes down Chevron, curtailing power of federal agencies, SCOTUSblog (Jun. 28, 2024), https://www.scotusblog.com/2024/06/supreme-court-strikes-down-chevron-curtailing-power-of-federal-agencies/
[5] Loper Bright Enterprises v. Raimondo, 603 U.S. ___ (2024), Justia Law, https://supreme.justia.com/cases/federal/us/603/22-451/
[6] Mario Loyola, The End of Chevron Deference, The Heritage Foundation, https://www.heritage.org/courts/commentary/the-end-chevron-deference
[7] Administrative Procedure Act (APA) | Britannica, https://www.britannica.com/topic/Administrative-Procedures-Act
[8] See [6], Mario Loyola, The End of Chevron Deference, The Heritage Foundation, https://www.heritage.org/courts/commentary/the-end-chevron-deference
[9] See [6], Mario Loyola, The End of Chevron Deference, The Heritage Foundation, https://www.heritage.org/courts/commentary/the-end-chevron-deference
[10] Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc, Oyez, https://www.oyez.org/cases/1983/82-1005
[11] Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984), Justia Law, https://supreme.justia.com/cases/federal/us/467/837/
[12] See [10], Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc, Oyez, https://www.oyez.org/cases/1983/82-1005
[13] See [11], Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984), Justia Law, https://supreme.justia.com/cases/federal/us/467/837/
[14] The Supreme Court Ends Chevron Deference—What Now?, (2024), https://www.nrdc.org/stories/what-happens-if-supreme-court-ends-chevron-deference
[15] See [14], The Supreme Court Ends Chevron Deference—What Now?, (2024), https://www.nrdc.org/stories/what-happens-if-supreme-court-ends-chevron-deference
[16] See [5], Loper Bright Enterprises v. Raimondo, 603 U.S. ___ (2024), Justia Law, https://supreme.justia.com/cases/federal/us/603/22-451/
[17] Paul D. Clement, https://www.law.georgetown.edu/faculty/paul-d-clement/
[18] The American Law Institute, Members, American Law Institute, https://www.ali.org/members/member/457791/
[19] See [5], Loper Bright Enterprises v. Raimondo, 603 U.S. ___ (2024), Justia Law, https://supreme.justia.com/cases/federal/us/603/22-451/
[20] See [5], Loper Bright Enterprises v. Raimondo, 603 U.S. ___ (2024), Justia Law, https://supreme.justia.com/cases/federal/us/603/22-451/
[21] See [5], Loper Bright Enterprises v. Raimondo, 603 U.S. ___ (2024), Justia Law, https://supreme.justia.com/cases/federal/us/603/22-451/
[22] See [6], Mario Loyola, The End of Chevron Deference, The Heritage Foundation, https://www.heritage.org/courts/commentary/the-end-chevron-deference
[23] Loper Bright Enterprises v. Raimondo, No. 22-451, slip op. at 27 (U.S. June 28, 2024). https://www.supremecourt.gov/opinions/23pdf/22-451_7m58.pdf
[24] See [23], Loper Bright Enterprises v. Raimondo, No. 22-451, slip op. at 27 (U.S. June 28, 2024). https://www.supremecourt.gov/opinions/23pdf/22-451_7m58.pdf
[25] See [23], Loper Bright Enterprises v. Raimondo, No. 22-451, slip op. at 27 (U.S. June 28, 2024). https://www.supremecourt.gov/opinions/23pdf/22-451_7m58.pdf
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