June 27, 2024 — The Supreme Court is expected to issue a decision this week that could have broad implications for the authority of federal regulatory agencies including the Securities and Exchange Commission and Environmental Protection Agency.
At issue is a four-decade-old precedent known as Chevron deference, which gives agencies wide latitude in crafting regulations. During oral arguments in January, some conservative justices expressed skepticism about it, suggesting the court could overturn or curtail it.
The precedent directs courts to defer to federal agencies’ reasonable interpretations of federal law when statutes are deemed ambiguous. Conservatives and business groups say that it has handed too much power to unelected government regulators.
Chevron deference lies at the heart of two cases the court heard this term: Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce. Both cases involve fishing boat operators who challenged the constitutionality of federal government regulations intended to protect Atlantic herring fisheries. The plaintiffs took issue with a 2020 National Marine Fisheries Service rule requiring boat operators to pay for federal monitors on their ships. This can cost as much as $710 a day, according to the plaintiffs.
Chevron has been a “disaster,” lawyers for one of the fishing companies, Loper Bright Enterprises, wrote in a November court filing. “Lower courts see ambiguity everywhere and have abdicated the core judicial responsibility of statutory construction to executive-branch agencies,” they wrote. “The exponential growth of the Code of Federal Regulations and overregulation by unaccountable agencies has been the direct result.”