On June 28, the Supreme Court of the United States (SCOTUS) issued an order that overruled 40 years of mandatory federal court deference to administrative agencies’ interpretation of ambiguous statutes. The decision was issued along ideological lines and has already begun impacting the administrative law regime.
Loper Bright Enterprises v. Raimondo (Loper), a case about who Congress intended to pay for certain fishing-industry regulation costs, was argued in January 2024. Despite the specific fact pattern, the impacts of the case will be wide-reaching in terms of administrative law because its overturning of the Chevron doctrine. The doctrine, which arose from a 1984 SCOTUS case, Chevron U.S.A., Inc. v. Natural Resources Defense Council, acknowledged the subject-matter expertise of federal agencies and required deference to an agency’s reasonable interpretation of ambiguous statutory language.
In Loper, the majority opinion, authored by Chief Justice Roberts and joined by the other conservative-leaning justices, noted that the Administrative Procedure Act (APA) requires courts to "exercise their independent judgement in deciding whether an agency has acted within its statutory authority." The decision notes that a court can be informed by federal agencies, including in cases where a statute may be ambiguous, but that questions of law should be left to the interpretation of the judiciary. In making this finding, the Court held that the Chevron doctrine is in conflict with the APA and overruled it. However, the Court did note that just because it was overturning Chevron , it was not calling into question prior cases that relied on the two-part test.
As expected, the Court’s left-leaning justices were adamantly opposed to the dismantling of Chevron, citing the severe burden that would likely be placed on the court system anytime all aspects of an agency’s authority was not explicitly defined by Congress. Justice Kagan, writing for the dissent, described the majority's decision as a "massive shock to the legal system" that will make it more difficult for industry to rely on agency rulemakings.
The full extent of the impacts from this case are still yet to be determined. However, in the short time since its issuance, the decision has been cited in countless briefs and even a handful of lower federal court orders that have ruled against Biden administration regulations. It is expected that Loper will continue to impact all aspects of administrative law. It may make agencies more cautious in its rulemakings, up to and including potentially issuing less rulemakings (although that does not seem to be the case with the Biden administration, as it has recently announced a significant regulatory agenda). It could lead to Congress providing more explicit direction in its authorizing legislation, which means that lobbyists may be more specific in their asks. And, unsurprisingly, it will likely lead to significant legal challenges (with increased "forum shopping," as agencies aren't guaranteed deference, but may still be given "respect," depending on the judge(s)) of a number of different rules, including those impacting the natural gas industry.
A copy of the full SCOTUS decision is available here.
APGA staff will continue to monitor the wide-ranging impacts of Loper and keep members aware of any relevant updates. APGA is also working with outside legal experts to develop an educational member webinar that will take a deeper dive into the potential ramifications of Loper, as well as other SCOTUS decisions from this term, on the federal regulatory regime.
If you have questions regarding this article, please contact Renée Lani of APGA staff by phone at 202-464-0836 or by email at rlani@apga.org.