Chevron May Emerge Dead or Wounded From Loper Case: Venable Lawyers

Lawyers at Venable said Thursday U.S. Supreme Court justices will likely find it irresistible to use an upcoming case, Loper Bright Enterprises v. Raimondo, to clarify the status of the Chevron doctrine (see 2305050038). The lawyers noted during a webcast that the brief seeking review of the case (docket 22-451) was written by Paul Clement, U.S. solicitor general under George W. Bush, and is salted with citations to decisions by many of the conservative justices inviting a review of Chevron.

In last year's West Virginia v. EPA, SCOTUS elaborated on the major-questions doctrine (see 2206300066), saying that on such questions Congress must provide clear authority for the administration to act, said Venable’s Craig Gilley. Agencies can’t rely on “very loose” or “very soft” delegation, he said.

Before last year, no appellant would have cited the major-questions test in briefs, Gilley said. “It’s a tremendous opportunity for a party that’s opposing any agency action -- you almost have to include it in an appellate brief,” he said. Chevron, decided in 1984, governs what happens when Congress' delegation is ambiguous or when the agency addresses “sort of a subtopic within a broader delegation,” he said. Chevron says as long as the agency’s action was “reasonable” the court will defer to that interpretation, he said.

Until SCOTUS does more, in most circuits “the assumption among litigants is you’re mostly going to lose Chevron cases right now” because the courts, especially the U.S. Court of Appeals for the D.C. Circuit, have been “extremely deferential in the face of statutory ambiguity and statutory silence,” he said.

A group of commercial fishing companies in Loper challenged a federal rule requiring the fishing industry to pay for the costs of observers who monitor compliance with fishery management plans, noted Venable’s Jay Johnson, an environmental law specialist. The appellants presented two questions -- whether the D.C. circuit, which ruled in favor of the National Marine Fisheries Service, was wrong as a matter of statutory interpretation, he said. The second question was whether the court should overrule or at least provide clarity on Chevron and the issue of statutory silence, he said.

SCOTUS granted hearing of only the Chevron question, Johnson said. “That’s a strong signal the court wants to consider Chevron again and decide whether that case is still viable,” he said.

Clement “knows what he is doing as an advocate,” said Venable’s Fred Wagner, former chief counsel to the Federal Highway Administration. The court “has been looking for the opportunity to deal with [Chevron] and this was potentially the vehicle for it,” he said. Wagner noted Justice Ketanji Brown Jackson, one of SCOTUS’ remaining three progressives, may recuse herself from hearing the case because she heard oral argument at the D.C. circuit.

Johnson said SCOTUS could go one of three ways in deciding Loper. The court could decide the statute isn’t really ambiguous and there’s no need to consider Chevron at all, he said. That’s probably the “best-case” result for the government, he said.

SCOTUS could also clarify there's a difference between when a statute is ambiguous and when it’s completely silent, Johnson said: “That is a step short of completely rejecting Chevron.” Gilley noted Congress often provides “a thin but powerful delegation, with a lot of silence underneath, and the agency steps in and fills all those voids,” Gilley said: If SCOTUS goes that way, “it could be a very significant change to how lawmaking is done and how administrative agencies work.”

SCOTUS could also say “it has been 40 years since we decided Chevron -- it didn’t work,” Johnson said. “This is something that petitioners pushed pretty hard on in their petition,” he said. Some observers see Chevron as not working as intended when handed down, he said: “It has become more of a thumb on the scale in favor of the agency.” There are probably some justices who will take that view, he said.

The court doesn’t have to make a “binary choice” on upholding or overturning the doctrine, despite most of the commentary on the Loper case so far, Gilley said: “There are steps in between. It’s not quite as binary as you have heard so far, and you’re going to continue to hear as the case comes to argument.”

Venable’s Laura Rich, a former Food and Drug Administration attorney, said limiting or overturning Chevron would present a real challenge for federal agencies. “The impact … would fall disproportionately on the agency’s attorneys and reg writers who will now have to balance an agency’s deeply felt policy goals” against the need to survive “a perhaps hostile review in court,” she said: “That’s going to be the overarching result.”