On Friday, the Supreme Court overturned a 1984 decision “colloquially known as Chevron that has instructed lower courts to defer to federal agencies when laws passed by Congress are not crystal clear,” reported AP News.
As The New York Times explains, the Chevron “decision held that when Congress passes a law that lacks specificity, courts must give wide leeway to decisions made by the federal agencies charged with implementing that law. The theory was that scientists, economists and other specialists at the agencies have more expertise than judges in determining regulations and that the executive branch is also more accountable to voters.”
The 6-3 ruling will put judges in the position to decide these questions rather than deferring their judgment to federal regulators. While the decision has been the basis for upholding federal regulations over the past 40 years, business groups have argued that it grants too much power to the executive branch.
“Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority,” Chief Justice John Roberts wrote for the court.
First, here’s a look at the case:
“Forty years ago, the Supreme Court ruled 6-0, with three justices recused, that judges should play a limited, deferential role when evaluating the actions of agency experts in a case brought by environmental groups to challenge a Reagan administration effort to ease regulation of power plants and factories,” wrote AP. The Chevron v. Natural Resources Defense Council case of 1984 “requires courts to defer to agencies’ reasonable interpretations of ambiguous statutes,” explained The Wall Street Journal.
“Judges are not experts in the field, and are not part of either political branch of government,” Justice John Paul Stevens wrote in 1984, explaining why they should play a limited role.
Since then, there have been 70 Supreme Court decisions relying on Chevron, along with 17,000 in the lower courts, reported The Journal.
On Friday, the judges ruled in a current case involving Atlantic herring fisherman suing over a rule that herring fishermen pay for government-mandated observers who track their fish intake. In overturning Chevron, the judges ruled that courts could exercise independent judgments to determine if a government agency has acted within its authority.
And here’s how it might impact businesses:
The decision will make it easier for anyone to challenge a federal regulation and win. NACS has ongoing cases challenging federal and state vehicle technology mandates as well as newly invented regulatory interpretations of labor rules. All of these challenges face improved prospects following the Supreme Court’s decision.
“One way that NACS has consistently advocated for the industry is through the courts,” said NACS General Counsel Doug Kantor. “Having judges more closely consider whether a federal regulation actually follows Congress’ intent should benefit our legal advocacy. We look forward to seeing the courts apply this new ruling on the issues that are priorities for the industry.”