The Supreme Court has overturned a 40-year-old precedent, making it harder for the federal government to regulate in areas such as the environment, public health, workplace safety, and consumer protections. This decision marks a significant victory for business interests and a shift in regulatory power dynamics.
The ruling, backed by the court’s six conservative justices, overturns the 1984 Chevron decision, which had allowed federal agencies to interpret ambiguous laws. This ruling has long been a target for conservatives aiming to reduce regulatory oversight. The court’s liberal justices dissented.
This decision is the most decisive action yet by the conservative majority to challenge what critics refer to as the administrative state. The potential financial implications are substantial, with billions of dollars at stake as future challenges to regulations arise. The Biden administration had warned that overturning Chevron could disrupt the legal system significantly.
Chevron’s core principle permitted federal agencies to fill in legislative details when laws were unclear, a practice opponents argued gave excessive power to unelected officials rather than judges. Chief Justice John Roberts emphasized that courts should independently determine whether agencies are acting within their statutory authority.
Justice Elena Kagan, in dissent, expressed concern that the decision undermines agency authority, noting that the ruling follows a pattern of the court scaling back regulatory power. The court also recently limited the SEC’s anti-fraud tools.
The case stemmed from a challenge by Atlantic herring fishermen in New Jersey and Rhode Island against a rule requiring them to pay for observers monitoring their catches. Lower courts had upheld this rule based on Chevron.
Conservatives and business interests supported the fishermen, hoping the Trump-appointed conservative majority would curb the regulatory state further. The Supreme Court has previously restricted environmental regulations and blocked Biden’s initiatives on COVID-19 vaccines and student loan forgiveness.
For the past seven years, the justices hadn’t relied on Chevron, though lower courts continued to do so. Chevron’s original ruling in 1984 limited judicial intervention in agency expertise, citing judges’ lack of specialized knowledge.
However, the current conservative majority has increasingly questioned federal agency powers. Justices Samuel Alito, Neil Gorsuch, Brett Kavanaugh, and Clarence Thomas, who have previously criticized Chevron, joined the majority opinion.
Roberts’ opinion challenged the notion that legal interpretation falls outside judicial responsibility, invoking the historic Marbury v. Madison decision. Kagan, however, warned that eliminating Chevron places courts in roles they are unprepared for.
Kagan’s dissent, joined by Justices Ketanji Brown Jackson and Sonia Sotomayor, emphasized that judges should not replace agency expertise. Critics of Chevron argued that it led to excessive judicial deference to bureaucratic decisions.
One of the fishermen involved in the lawsuit, Bill Bright, welcomed the decision, citing the importance of protecting livelihoods. The White House criticized the ruling as a setback for public safety and consumer protection.
Federal agencies had already begun to reduce reliance on Chevron when crafting new regulations. Advocacy groups and some lawmakers urged the court to uphold Chevron, arguing that the decision undermines effective governance and public protections.
The ruling has far-reaching implications, potentially challenging hundreds of regulations across various sectors. Business and conservative groups had supported the fishermen’s challenge, reflecting broader efforts to limit regulatory oversight.
The fishermen’s lawsuits contested a 2020 regulation imposing a potentially significant fee for mandated observers, arguing that Congress hadn’t authorized such requirements. Lower courts upheld the regulation based on Chevron.
The Supreme Court heard two cases on the issue, with Justice Jackson recused from the New Jersey case due to prior involvement as an appeals court judge. The full court participated in the Rhode Island case.
