The U.S. Supreme Court overruled Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., a landmark case that established the principle of judicial deference to agency interpretations of ambiguous statutes. Under Chevron, courts deferred to agency interpretations as long as they were reasonable, even if the courts would have interpreted the statute differently.
In Loper Bright Enterprises v. Raimondo, the Supreme Court held that Administrative Procedures Act requires courts to exercise their independent judgment in deciding whether an agency acted within its statutory authority, and courts may not simply defer to an agency interpretation of the law simply because the statute is ambiguous. The Court analyzed the historical context of judicial deference, emphasizing that, traditionally, courts did not defer to executive interpretations of law. Instead, the judiciary was responsible for interpreting the law, while agency determinations of fact were given weight only if supported by evidence. Thus, the opinion reinforces the judiciary’s role as the ultimate arbiter of statutory meaning.
The implications of the Court’s opinion are far-reaching.
First, agencies will face more rigorous judicial scrutiny. Courts will independently assess the legality of agency actions without automatically deferring to the agency’s interpretation.
Second, the death of Chevron deference will undoubtedly lead to an increase in litigation challenging agency interpretations of statutes. Entities affected by agency regulations might be more inclined to contest agency decisions, expecting a more favorable review from the courts.
Third, agencies might need to be more precise and thorough in their rulemaking processes. Since their interpretations will not receive automatic deference, agencies must ensure their actions clearly align with statutory mandates to withstand judicial review.
Finally, judicial interpretation of ambiguous statutes could lead to a decrease in consistency in interpretation unless an appellate court or the Supreme Court decides the matter. And because the Supreme Court determines which cases to hear, circuit splits in interpretation may take years to resolve.
The overruling of Chevron deference marks a significant shift in administrative law, emphasizing judicial independence in statutory interpretation. This change underscores the judiciary’s role in ensuring that agencies act within the bounds of their statutory authority, potentially leading to more careful and transparent agency rulemaking and enforcement processes.