Judicial review of agency interpretations has undergone significant evolution and is continuing to do so. Marked by landmark Supreme Court decision Loper Bright Enterprises v. Raimondo, today's evaluation of administrative legal issues by the Court employs analysis through classic statutory canons, a departure from deference to agency determinations.
Looking Back at Chevron Deference
Legislation often grants agencies the authority to implement and enforce statutory provisions, requiring agencies to interpret ambiguous statutory language. This interplay between legislation and agencies has historically allowed for a flexible approach to governance, as agencies possess subject-matter expertise and the ability to adapt regulations to evolving circumstances. However, courts have also played a crucial role in ensuring that agency interpretations align with congressional intent.
Before the advent of Chevron deference, courts relied on frameworks like Skidmore v. Swift & Co., 323 U.S. 134 (1944) to evaluate agency expertise as "persuasive authority." However, the landscape shifted dramatically in 1984 with Chevron U.S.A., Inc. v. Natural Resources Defense Council 467 U.S. 837 (1984). The "Chevron deference" framework established by the Supreme Court consisted of a two-step test requiring courts first to assess whether a statute is ambiguous and, if so, to defer to the agency's reasonable interpretation.
This framework rapidly became a cornerstone of administrative law throughout the nation, with federal district courts applying Chevron in 85% of cases involving agency interpretation over the past decade. However, the Supreme Court has gradually shifted away from Chevron deference since its issuance.
A Change in Course: The Loper Bright Decision
Culminating in the case Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024), the Court held that under the Administrative Procedure Act (APA) Section 706, courts must exercise independent judgment when determining whether agencies have acted within their authority.
Section 706 of the APA states that "the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action." The Court in Loper found that Chevron deference improperly required courts to abdicate this responsibility, instead compelling them to adopt agency interpretations even when a court believed an alternative interpretation was more consistent with the statute's text. The majority opinion explained that "Chevron deference contravenes the fundamental principle that it is the duty of the judiciary to say what the law is," echoing Marbury v. Madison 5 U.S. 137 (1803).
In its analysis, the Court rejected the notion that courts should automatically defer to agency interpretations of ambiguous statutes. The ruling affirmatively overturned Chevron and seemed to effectively mark a return to the principles of Skidmore.
Implications of the Loper Bright Decision on Administrative Law
A likely development in the Loper era is the Court's growing reliance on "plain meaning interpretation" and other statutory questions in evaluating administrative law. This approach directs that the interpretation of statutes or other legal texts be predicated on the ordinary and commonly understood meaning of the words used, or as they appear on the face of the text.
Additionally, the decision raises questions about the precedential value of past cases decided under Chevron. While the Court in Loper declined to overturn previous Chevron-based rulings, it introduces uncertainty about the framework's future applicability over previous holdings reliant on the two-step framework.
Another likely implication is a chilling effect on rulemaking and agency authority. The EPA, for example, has already begun retreating from aggressive regulatory actions, particularly in light of the "major questions doctrine" articulated in West Virginia v. EPA (2022), which limits agencies' authority to address issues of vast economic and political significance without clear congressional authorization.
In some industries impacted by agency interpretations, lobbyists are working on the legislative level to craft statutes that leave little or no room for interpretation.
Finally, Loper opens the door to strategic litigation and forum shopping. Plaintiffs challenging agency interpretations may seek out courts less deferential to the executive branch, while supporters of agency decisions may target more sympathetic jurisdictions. This dynamic is particularly significant for heavily litigated areas like environmental and telecommunications regulation, where agencies like the EPA and the FCC have historically benefited from Chevron deference.
City and County of San Francisco v. Environmental Protection Agency
The first Supreme Court decision on agency interpretations post Loper was decided on March 4, 2025. In the case City and County of San Francisco v. Environmental Protection Agency, a 5-4 Supreme Court decision narrowed the Environmental Protection Agency's (EPA) authority under the Clean Water Act (CWA) to enforce outcome-based permit conditions on entities discharging pollutants into U.S. waters. A decision which will have immediate and far-reaching implications over the National Pollutant Discharge Elimination System (NPDES) permitting framework.
In its analysis, the Court focused on Section 301(b)(1)(C) of the CWA which authorizes the promulgation of "any more stringent limitation, necessary to meet water quality standards." Reviewing the Webster definition of the word "limitation" in addition to that of "implement" and "meet", the Court concludes that the EPA cannot "make a permittee responsible for the quality of the water in the body of water into which the permittee discharges pollutants" unless the EPA provides specific, quantifiable effluent limitations in discharge permits rather than open-ended directives.
Further, the Court rejects an argument made by the City that all limitations are "effluent limitations" noting that "where Congress includes particular language in once section of a statue but omits in a another...it is generally presumed that Congress acts intentionally." In addition to its prominent use of statutory canons, the Court in its analysis contemplates the legislative history of the CWA and its overall regulatory framework.
In a brief acknowledgement of the Agency's interpretation, the Court notes that,
"[in] attempting to read more into the phase I language, the EPA cites guidance it issued in 1995, but Congress did not codify that guidance, and we are not obligated to accept administrative guidance that conflicts with the statutory language it purports to implement. See Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024)."
The path of the Court's logic in this case confirms that the use of "plain meaning" and other textual canons will provide the bedrock for interpretation of administrative law for the foreseeable future. Further, as noted by the dissenting opinion, despite the majority's statement that water quality will not suffer under their decision, the decision will likely make permit issuance far more difficult for the EPA, as the agency will have to impose individualized conditions, "chilling" the agency's strength under the CWA.
Conclusion
As courts increasingly prioritize textual clarity and limit deference to agency expertise, the implications of the Loper case, and the balance of power between the legislative, executive, and judicial branches, will continue to shape the future of administrative law.
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