So, what do we do when Congress writes a statute pertaining to a federal agency and administrative law which no one can understand?
On Friday, June 28 the U.S. Supreme Court expressly overruled the case from which “Chevron deference” is derived. The case is Loper Bright Enterprises v. Raimondo (22-451) (holding that “The Administrative Procedure Act requires courts to exercise their independent judgment in deciding whether an agency has acted within its statutory authority, and courts may not defer to an agency interpretation of the law simply because a statute is ambiguous.”)
If you don’t know what “Chevron deference” is, don’t worry, I am one of those nerds who spent the 4th of July reading the case so I can unpack this for you. After all, it isn’t that often we a get S.Ct. decision that takes me back to law school, with cites to Chief Justice Marshall and Marbury v. Madison.
The way a bill becomes a law, meaning how a “statute’ ends up published in the United States Code (“U.S.C.”) is very cumbersome, in that both houses of Congress must vote to pass the bill, then the President must sign it. This is a hugely inefficient way to govern. Anytime the government wishes to change anything, there would need to be a new statute, complete with presidential signature.
The way a rule becomes a law, one that ends up published in the Code of Federal Regulations (“C.F.R.”) is that Congress must first delegate rule-making authority to the executive branch (a/k/a the “administrative branch”) through an “enabling statute,” which is why we call it “administrative law.” Every official CFR rule will cite its enabling statute, which helps us know the rule is valid and we must obey it.
Administrative law exploded in the industrial era after the “New Deal,” (there wasn’t much need for the F.A.A. until we invented airplanes.) And soon too, problems of interpretation followed. There is a reason for this.
Congress frequently paints a big fuzzy picture in very low resolution of what Congress intends by a statute (think Monet’s “Water Lilies”). Then somebody has to figure out what Congress meant.
Chevron Deference is (“was”) one method of interpretation, which held that if Congress wrote an ambiguous law, it did so on purpose, intending that the relevant administrative agency figure it out. Courts would then just defer to the agency’s interpretation. And everybody would be perfectly content, walking hand in hand into the sunset.
“The Rise of Tyranny.” While it is very difficult for Congress to pass any law, it seems federal administrative agencies literally cannot stop themselves making new ones. As noted, after the “New Deal” era, administrative law rapidly expanded, to the point there is seemingly a regulation for every regulation. Critics argue that giving federal agencies that much power leads to tyranny by unelected officials.
For example, federal agencies frequently don’t stick to the plan of writing formal CFR “rules,” but instead will also issue “sub-regulatory” pronouncements about the rules, published in the Federal Register (F.R.) Which sounds official, but really isn’t. These interpretations aren’t law at all, but merely ideas stuck in a register where the government publishes both real laws and almost every thought the government ever has had.
Nevertheless, these sub-regulatory Federal Register pronouncements will then be cited (volume and page) by the very agencies who dreamed them up, as if these “ideas” are laws. For for example in lawsuits against my clients, the government will cite these FR entries to demonstrate that a defendant was “on notice” of an interpretation taken by a federal regulatory agency, even though the position was neither in an actual rule nor a statute.
One of the best books criticizing this state of affairs, is The Rise of Tyranny, by Jonathan Emord (2008), because of quotes like this:
“Since the 1930s the Congress has delegated legislative, executive, and judicial powers to over 200 independent regulatory commissions. Those agencies enact over ninety percent of all federal law. They are ruled by individuals who are unelected and largely unaccountable to the Courts and Congress. Repeatedly they pursue their own self-interest at the expense of life and health. Often the agencies become captives of the industry they regulate, as in the case of the FDA (captive to the pharmaceutical industry) because it is in the economic self-interest of those who run the agency to obtain lucrative post government employment form the key industries regulated. The result is widespread corruption, biased and perverse enforcement of the law, and anti-competitive regulation.
The Chevron Doctrine comes from a “Clean Air Act” Supreme Court decision during the Reagan Administration in 1984, where the Court reasoned that under the Administrative Procedures Act, courts should accord due respect to the Executive Branch’s interpretation of ambiguous federal statutes because “[t]he officers concerned [were] usually able men, and masters of the subject,” who may well have drafted the laws at issue.
While the APA specifically mandates that Courts treat most agency determinations of fact as binding on the courts, under the Chevron Doctrine, courts also began deferring to administrative agencies’ interpretation of Congressional intent on questions of law. Which is not in the APA.
At the time in 1984, the Chevron case wasn’t thought to be that big a deal. But in subsequent cases, the Court eventually stated that Chevron rested on “a presumption that Congress, when it left ambiguity in a statute meant for implementation . . . first and foremost, by the agency, and desired the agency (rather than the courts) to possess whatever degree of discretion the ambiguity allows.”
In Loper Bright Enterprises v. Raimondo (June 2024) The S.Ct. expressly overruled Chevron, holding:
“Chevron cannot be reconciled with the APA by presuming that statutory ambiguities are implicit delegations to agencies. That presumption does not approximate reality. A statutory ambiguity does not necessarily reflect a congressional intent that an agency, as opposed to a court, resolve the resulting interpretive question.
However, the Court was clear, that any case decided under Chevron is still valid.
“By overruling Chevron, though, the Court does not call into question prior cases that relied on the Chevron framework. The holdings of those cases that specific agency actions are lawful—including the Clean Air Act holding of Chevron itself—are still subject to statutory stare decisis despite the Court’s change in interpretive methodology.
Which means, we lawyers (representing regulators and the regulated), get to go fight all over again, about what Congress’ might have meant, because we can no longer presume Congress knew what it was doing, when it wrote a statute no one understands.