The United States Supreme Court’s decision in Loper Bright Enterprises v. Raimondo marks a significant shift away from the long-established Chevron doctrine. This development profoundly affects how businesses strategize their operations in relation to U.S. federal law, altering the dynamics between in-house legal teams, general counsel, and their respective government affairs units.
The overturning of Chevron deference, which historically allowed U.S. agencies to interpret ambiguous federal laws, opens up these interpretations to legal challenges. This paradigm shift broadens the potential for increasing litigation and necessitates a careful reassessment of legislative drafting by Congress. In the absence of agency-led interpretation, legislation will likely require more specificity regarding the powers granted to agencies. This creates an avenue for organizations to significantly influence the legislative process.
General counsels (GCs) are encouraged to spearhead efforts to develop strategies tailored to this new legal environment. This involves closely collaborating with government affairs teams to identify and leverage legislative opportunities. A critical first step is to thoroughly evaluate current government affairs and regulatory tracking mechanisms.
According to insights from experts like Gartner’s Alissa Lugo, it is essential for GCs to lead an interdisciplinary team, including government affairs colleagues, to assess how effectively the organization influences federal and state legislation. This evaluation should include mapping the organization’s involvement with trade associations and examining the robustness of relationships with lawmakers.
In light of possible regulatory shifts, organizations are urged to engage in proactive monitoring of both federal and state legislative actions. This would include keeping track of how federal regulation might evolve, considering that future legislation could be more prescriptive, altering the landscape of agency powers significantly.
The post-Loper Bright era presents an opportunity for businesses to engage more directly in the legislative process, particularly in sectors where regulatory compliance poses substantial costs or strategic impact. GCs should facilitate discussions to pinpoint high-impact regulatory areas and develop strategies aligned with organizational goals.
It is pertinent for organizations to deliberate on their resource allocation for government affairs, potentially expanding their teams or increasing reliance on trade associations if needed. Litigation may also play a role as a strategic tool in shaping regulation and legislation, but it demands careful consideration of costs and resource allocation.
Ultimately, GCs play a crucial role in navigating this transformed landscape by systematically tracking legislative developments, identifying and prioritizing impactful regulatory areas, and crafting strategies that align with the organization’s long-term interests and resources.