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June 28, 2024
Health Law Weekly

U.S. Supreme Court Overturns Chevron Deference

  • June 28, 2024
supreme court

The U.S. Supreme Court June 28 overturned precedent established in 1984 under which courts deferred to federal agency expertise. The decision shifts the balance of power between the judiciary and executive branches of government and will have far-reaching implications for statutory interpretation.

The 6-3 decision, authored by Chief Justice Roberts, invalidates Chevron deference—that courts will defer to administrative action that is a reasonable interpretation of ambiguous statutory language—which has been a cornerstone of administrative law since the case was decided. Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (1984).

Although the case specifically involves environmental regulations, the Court’s decision will have sweeping implications for heavily regulated industries like health care and life sciences.

The case was initiated by family-owned and operated herring fishing companies in the Atlantic to challenge a National Marine Fisheries Service (NMFS) regulation requiring them to pay the salaries of government-mandated monitors who are on board their vessels to ensure compliance with federal regulations.

A divided panel of the D.C. Circuit upheld the NMFS regulation after finding the governing statute’s silence on the issue made it ambiguous, requiring the court to defer to the agency under Chevron.

But the High Court held the “deference that Chevron requires of courts reviewing agency action cannot be squared with” the Administrative Procedure Act (APA).

Roberts’ opinion included a lengthy history of the proper role of the courts, noting that the framers of the Constitution envisioned that the final “interpretation of the laws” would be “the proper and peculiar province of the courts.”

Although in exercising independent judgment, courts often accorded due respect to executive branch interpretations of federal statutes, the views of the executive branch should inform the judgment of the judiciary, not supersede it, the opinion said.

The APA “specifies that courts, not agencies, will decide ‘all relevant questions of law’ arising on review of agency action . . . even those involving ambiguous laws—and set aside any such action inconsistent with the law as they interpret it,” Roberts wrote, noting the APA “prescribes no deferential standard for courts to employ in answering those legal questions.”

In separate concurrences, Justice Thomas joined in the overturning of Chevron deference and argued that it also violates the Constitution’s separation of powers doctrine, and Justice Gorsuch argued that the doctrine of stare decisis supports the decision to strike Chevron.

A scathing dissent, authored by Justice Kagan and joined by Justices Sotomayor and Jackson, argued that agencies are better positioned to interpret statutes than courts because they are staffed with “experts in the field” who can bring their training and knowledge to bear on open statutory questions. Deference to an agency’s expertise “is the almost obvious choice, based on an implicit congressional delegation of interpretive authority,” the dissent said.

Instead, “[i]n one fell swoop, the majority today gives itself exclusive power over every open issue—no matter how expertise-driven or policy-laden—involving the meaning of regulatory law.” The APA “makes no such demand,” the dissent argued.

Roberts addressed this argument in his opinion, contending that statutory ambiguities aren’t implicit delegations to agencies. Courts routinely confront statutory ambiguities in cases having nothing to do with Chevron, Roberts wrote. In those cases, courts “understand that such statutes, no matter how impenetrable, do—in fact, must—have a single, best meaning.”

Chevron’s presumption is misguided because agencies have no special competence in resolving statutory ambiguities. Courts do,” the majority opinion said.

But the dissent said the “[t]he idea that courts have ‘special competence’ in deciding such questions whereas agencies have ‘no[ne]’ is . . . malarkey.” Answering questions of regulatory interpretation demands one or more of: subject-matter expertise, long engagement with a regulatory scheme, and policy choice, the dissent argued.

According to the dissent, the overturning of Chevron cannot find its basis in the APA and “subverts every known principle of stare decisis.”

Loper Bright Enters. v. Raimondo, Nos. 22–451 and 22–1219 (U.S. June 28, 2024).

AHLA will continue to provide analysis on the far-reaching implications of this breaking news story.