Top takeaways from the January 17, 2024 oral arguments in Loper Bright and Relentless:
1. To invalidate or eviscerate? Before turning to the January 17, 2024 arguments, here’s a quick recap of Chevron’s two-step framework and when it applies: Courts may rely on the Chevron doctrine only when agency action carries the force of law, as in context of formal rulemaking; it does not apply to informal executive actions like guidance statements or policy manuals, which may be accorded deference only under Chevron’s impotent cousin, Skidmore. When Chevron applies, courts follow a two-step process to evaluate an agency’s interpretation of the statute at issue. In step one, a court must determine whether Congress clearly addressed the question at issue; if it did, then the court must apply the plain language of the statute, and no deference is warranted. If, however, the statute is silent or ambiguous with respect to the question at issue, the court proceeds to step two, where it defers to the agency’s statutory interpretation so long as that interpretation is a “reasonable” one.
The January 17, 2024 oral arguments left little doubt that the Supreme Court will either gut the Chevron doctrine or expressly overturn it—more likely the latter. Even Solicitor General Elizabeth Prelogar, recognizing that a full-throated reaffirmance isn’t on the table, focused her defense of the doctrine on ways in which the Court could limit its application without jettisoning it altogether. General Prelogar urged the Court to “issue a course correction” to lower Courts, stressing that they must employ all traditional tools of statutory interpretation to ascertain Congress’s meaning before “wav[ing] the ambiguity flag.”
Multiple justices were clearly unimpressed. Justice Gorsuch, for example, responded that the Court had already done that “like 15 times over the last eight or 10 years.” And still, he and several other justices insisted, lower courts are struggling to understand “what Chevron means” and invoking it far too often. With the Court having already attempted to clip Chevron’s wings—in this way and through doctrinal innovations like the major questions doctrine—it’s hard to imagine what a (further) narrowed Chevron would look like. For this reason, and the all-but-certain votes of at least four justices to overturn the doctrine, the end of Chevron appears likely.
2. The justices’ views. It was no surprise that at least four justices appeared ready to invalidate the Chevron doctrine, a backbone of administrative law for nearly 40 years. Justices Thomas, Alito, Gorsuch, and Kavanaugh have all strongly criticized the doctrine in the past, and they showed no compunction at oral argument about discarding it altogether. The three liberal justices—Justice Kagan most vociferously—defended the doctrine on stare decisis and reliance grounds, as well as on the basis of Chevron’s original rationale, i.e., that federal agencies charged with enforcing a statute through rulemaking are better suited than courts, owing to their scientific and technical expertise, to address statutory gaps and ambiguities.
That leaves Chief Justice Roberts and Justice Coney Barrett, whose views are less apparent. Neither showed any love for Chevron at oral argument, but nor—in contrast to their conservative counterparts—has either announced a readiness to eliminate it. And Justice Coney Barrett did signal concern on stare decisis grounds about overturning the decades-old framework. Chief Justice Roberts, on the other hand, suggested that the impact might not be so significant. Noting that the Supreme Court hasn’t relied on Chevron in years, the Chief Justice asked if the Court had already “overruled it in practice,” such that invalidating the doctrine would not in fact have the seismic impact the government suggests. Because the liberal justices would need the votes of both the Chief Justice and Justice Coney Barrett to keep Chevron on life support, the odds would seem to favor invalidation.
3. The impact—on lower courts, regulated industry, and federal rulemaking. It is true that the Supreme Court has not relied on Chevron in a long while—“14 or 16 years”—by Chief Justice Roberts’s count. To cite one prominent example, many observers noted the Court’s glaring avoidance of Chevron in its unanimous decision last term in American Hospital Association v. Becerra, 142 S. Ct. 1896 (2022), an opinion that surely would have invoked Chevron in earlier years. The Roberts Court has also turned increasingly to the major questions doctrine, which states that courts will not presume Congress intended to delegate to executive agencies major questions of political or economic import. The Chief Justice put it this way in West Virginia v. EPA, 142 S. Ct. 2587 (2022): “[I]n certain extraordinary cases, both separation of powers principles and a practical understanding of legislative intent make us ‘reluctant to read into ambiguous statutory text’ the delegation claimed to be lurking there.” In such cases, the Court has held, affording a federal agency deference à la Chevron is inappropriate.
So, the Chief Justice is likely correct that overturning Chevron would have little impact on this Supreme Court. But the same can’t be said of lower courts, which decide the vast majority of challenges to agency action. As Justice Kagan pointed out at oral argument, roughly 17,000 lower court decisions have relied on Chevron since its inception in 1984. And they continue to do so regularly. A 2022 study surveying courts of appeals cases from 2020-2021 found that federal appellate courts continue to apply Chevron in nearly 85% of cases in which an agency interpretation is at stake. In approximately 60% of these cases, the court concluded that the statute was ambiguous (Chevron step one) and proceeded to determine whether the agency’s interpretation was reasonable (Chevron step two). According to the study, once courts of appeals reached this point in the Chevron framework, they sided with the agency 77% of the time. An earlier 2017 study that evaluated more than 1,300 courts of appeals cases from 2003 to 2013 found an even higher rate of deference to agencies’ position—roughly 94%—at Chevron step two (i.e., after the court has concluded that the statute is ambiguous). In short, even if the Chief Justice is correct that the Supreme Court has already overruled Chevron in practice, lower courts haven’t gotten the memo. A decision expressly invalidating the doctrine would therefore have a major impact in the lower courts.
With only feeble Skidmore deference to fall back on, government agencies are likely to lose more often in challenges to agency rulemakings and other agency actions previously protected by Chevron. Many in industry are surely cheering this prospect, and for good reason. But, although the end of Chevron may result in more consistent agency policy from one administration to the next, it will also produce more (perhaps much more) variation in lower courts’ handling of agency cases. In this respect, then, the death of Chevron will mean greater uncertainty for regulated entities.
Finally, it is likely to lead to changes in federal rulemaking. With ambiguity and deference off the table, courts will be able to avail themselves only of traditional tools of statutory interpretation to determine Congress’ intent. As a result, agencies are likely to be more cautious in their rulemaking. This may be helpful or harmful to industry, depending on the circumstances. After all, this new reality will constrain all agency heads, whatever their political stripes or agenda.
4. A flood of litigation? As noted above, it’s not clear what will be left, or how Chevron deference will operate, if the Court guts the doctrine but leaves it nominally intact. If the January 17, 2024 arguments are any indication, however, the Supreme Court will make certain this time that lower courts get the message—and defer to agencies’ interpretation far less frequently. Even if Chevron survives, in other words, it is likely to be toothless, producing largely the same results as an express invalidation in forthcoming challenges to agency action. (That might be a slight exaggeration, as it will depend on the court and judge(s) hearing the case, but in many instances the result will be effectively the same.)
That cannot be said of renewed challenges to existing federal regulations. For a host of reasons, including substantial reliance interests, courts are unlikely to revisit longstanding regulations without an express ruling from the Supreme Court that invalidates the basis on which they were sustained in the first place. But if the Court overturns Chevron, agency rules upheld in the past at Chevron step two may be vulnerable to attack, stare decisis or no. The Solicitor General predicted yesterday that “litigants will come out of the woodwork, seeking to open those decisions” on the ground that the statute must be “interpreted without granting any deference to the agency’s interpretation.”
Maybe so. Whatever happens, it looks like a new era of administrative law is about to dawn.
