The recent Supreme Court decision to overrule the 40-year-old Chevron deference marks a significant shift for companies navigating administrative law. Chevron deference mandated courts to defer to agencies’ reasonable interpretations of ambiguous statutes. With its absence, companies must now adapt strategically. Here are five actionable steps that corporations can pursue in response to this landmark ruling.
- Don’t Panic. It’s crucial to recognize that not every rule upheld under Chevron is vulnerable. The nuances of Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce show that the Supreme Court emphasized statutory stare decisis. This means prior decisions based on agency interpretations remain largely intact unless the specific statute was ambiguous, the agency’s interpretation was just reasonable but not optimal.
- Reevaluate Existing Rules. Given the evolution of the legal landscape, businesses should consider challenging existing rules upheld under Chevron. The Supreme Court’s upcoming decision in Corner Post could offer new avenues for challenging older regulations, especially given the reconsideration of the APA’s six-year statute of limitations.
- Don’t Expect Stability from Agencies. As Chevron provided leeway for varied interpretations across administrations, agencies won’t necessarily defend previous approaches. Organizations must monitor litigation actively and potentially intervene to support agency interpretations that align with their interests because remaining passive could backfire if an agency’s stance changes.
- Refocus Comment Letters. Comment letters should emphasize statutory interpretation grounded in plain meaning, dictionary definitions, and legislative intent rather than policy arguments. As agencies strive to pinpoint the “best” interpretation, these elements will be critical in shaping their approach and standing up in potential judicial reviews.
- Strategize Long-Term Litigation Approaches. With Chevron gone, doctrines like the major questions doctrine and non-delegation doctrine will gain prominence in administrative procedure litigation. Legal professionals should explore opportunities to argue that interpretive rules should have undergone notice-and-comment procedures and prepare for circuit splits, aiming for Supreme Court reviews when necessary.
The pivot from Chevron deference necessitates a nuanced and dynamic approach to regulatory compliance and litigation. By staying proactive and informed, companies can mitigate risks and navigate this transformed legal landscape effectively.