A shift in the separation of powers – the overruling of Chevron

A few days ago, the United States Supreme Court overruled Chevron U.S.A. Inc. v. Natural Resources Defense Council, 467 U.S. 837 (1984). Chevron was a longstanding precedent holding that the federal courts must defer to a federal administrative agency’s “permissible” interpretation of an ambiguous federal statute. Chevron required a reviewing court to decide initially whether the statute in question was ambiguous. If Congress had spoken clearly on the issue, then the court would interpret the statute. If the court concluded that Congress had left a gap in the statute, then it would defer to the agency’s “permissible” interpretation.

In Loper Bright / Relentless (released on June 28, 2024), the majority opinion, authored by Chief Justice Roberts, explained that Chevron “defies” the Federal Administrative Procedure Act (“APA”), 5 U.S.C. § 701 et seq., which states that the courts determine all relevant questions of law and interpret statutory provisions. The majority opinion reasoned that Chevron skewed the separation of powers by delegating the judicial branch’s role interpreting ambiguous statutes to the executive branch. According to the majority opinion, Chevron  yielded unacceptably inconsistent results because a court’s assessment of whether an ambiguity exists is too subjective. The majority opinion held that courts must use the tools in their interpretative toolkit to construe an ambiguous statute. Thus, an agency’s position on an ambiguous statute maintains a “power to persuade” a reviewing court but is not outcome determinative.

The dissenting opinion, authored by Justice Kagan, retorted that Chevron deference is a longstanding legal presumption, many of which are present in our nation’s common law, and does not contradict the APA’s standard of review. The dissent further stated the resolution of statutory ambiguities within an agency’s framework is often more a question of “policy than law”; accordingly, the deference to the executive branch was appropriate as that branch through the President is answerable to the people. The dissent also explained that the courts, although well-equipped to interpret statutes, do not possess the requisite expertise to interpret hyper-technical statutes. According to the dissent, the Congress understood an administrative agency is often better equipped to provide a reasonable interpretation of an ambiguous technical statute within that agency’s bailiwick and, thus, had left Chevron untouched.

The implications of Loper Bright / Relentless remain to be seen. As for prior cases, the Court stated that its overruling of Chevron does not “call into question” prior cases that relied on the Chevron framework in and of itself. That does not mean, however, that challenges will not surface in the near-term calling those prior decisions into question.

Additionally, the Court’s decision in Loper Bright / Relentless does not address an agency’s interpretation of its own regulations. The Court recently affirmed the deference afforded to an agency’s interpretation of its regulations – referred to as Auer deference – in Kiso v. Wilkie, 588 U.S. 558 (2019). The dissent surmises that Auer deference may be next on the chopping block.

Loper Bright / Relentless does not directly impact state agencies. For now, state courts can continue to apply Chevron deference to the extent such was adopted.

In Connecticut, our Supreme Court adopted a Chevron like standard. Our state courts afford deference to an agency’s construction of a statute or regulation if that construction is formally articulated and both time-tested and reasonable. The Connecticut Supreme Court has emphasized, however, that the courts, and not administrative agencies, interpret and apply governing principles of law. Accordingly, Connecticut courts will not afford “special deference” to an agency’s interpretation if that interpretation has not been previously subjected to judicial scrutiny.

Updike, Kelly & Spellacy, P.C. (UKS) represents clients before many administrative agencies and is well versed in the Uniform Administrative Procedure Act. If you have any questions regarding potential or pending applications or enforcement matters before an administrative agency, please do not hesitate to contact Jesse A. Langer.  

Jesse A. Langer is a Shareholder in UKS’ New Haven office, practicing in the areas of administrative proceedings, energy and utilities, real estate development and employment. He can be reached at jlanger@uks.com or 203.786.8317.