“Chevron deference” is referring to the doctrine of judicial deference given to administrative action. It was coined after a landmark case, Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 468 U.S. 837 (1984). In Chevron, the Supreme Court set forth a legal test as to when the court should defer to the agency’s answer or interpretation, holding that such judicial deference is appropriate where the agency’s answer was not unreasonable, so long as Congress had not spoken directly to the precise issue at question.
Chevron was one of the most important principles in administrative law for 40 years. In June of 2024, the U.S. Supreme Court overturned the Chevron doctrine in Loper Bright Enterprises v. Raimondo stating: “The Administrative Procedure Act requires courts to exercise their independent judgment in deciding whether an agency has acted within its statutory authority, and courts may not defer to an agency interpretation of the law simply because a statute is ambiguous; Chevron is overruled.”
The scope of the Chevron deference doctrine was when a legislative delegation to an administrative agency on a particular issue or question was not explicit but rather implicit, a court may not substitute its own interpretation of the statute for a reasonable interpretation made by the administrative agency. Rather, as Justice Stevens wrote in Chevron, when the statute was silent or ambiguous with respect to the specific issue, the question for the court was whether the agency’s action was based on a permissible construction of the statute.
First, the Chevron deference required that the administrative interpretation in question was issued by the agency charged with administering that statute. Accordingly, interpretations by agencies not in charge of the statute in question were not owed any judicial deference. Also, the implicit delegation of authority to an administrative agency to interpret a statute did not extend to the agency’s interpretation of its own jurisdiction under that statute.
Generally, to be accorded Chevron deference, the agency’s interpretation of an ambiguous statute had to be permissible, which the Court has defined to mean “rational” or “reasonable.” In determining the reasonableness for the particular construction of a statute by the agency, the age of that administrative interpretation as well as the congressional action or inaction in response to that interpretation at issue would be a useful guide; if Congress were aware of the interpretation when it acted or refrained from action, and when the agency’s interpretation was not inconsistent with the clear statutory language.
In subsequent cases, the Supreme Court narrowed the scope of Chevron deference, holding that only the agency interpretations reached through formal proceedings with the force of law, such as adjudications, or notice-and-comment rulemaking, qualify for Chevron deference, while those contained in opinion letters, policy statements, agency manuals, or other formats that do not carry the force of law are not warranted a Chevron deference. In such cases, the Court may have given a slightly less deferential treatment to the agency’s interpretation, giving a persuasive value under the Court’s “Skidmore deference” analysis.
The Supreme Court overturned the Chevron doctrine in Loper Bright Enterprises v. Raimondo (2024) holding that it was inconsistent with the Administrative Procedure Act (APA) and gave unelected government officials too much authority.
By overturning Chevron, the Court realigns the doctrine with the requirements of Section 706 of the Administrative Procedure Act, which stipulates that “[t]o the extent necessary to decision and when presented, 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.” See: Loper Bright.
According to the Loper Court, step 2 (implicit delegation of authority) of the Chevron test erred in that it “requires a court to ignore, not follow, the reading the court would have reached” had it exercised its independent judgment as required by the APA.” See: Loper Bright. The command of step 2 of the Chevron test was inconsistent with not only the APA but also judicial practice prior to Chevron and Article III of the Constitution. See also Davies Warehouse v. Bowles and Whitman v. American Trucking Associations. Loper Bright rejects the premise that Congress’ creation of an ambiguous statute means that Congress intended for an administrative agency to fill in the gaps. See Loper Bright and C. Sunstein, Interpreting Statutes in the Regulatory State, 103 Harv. L. Rev. 405, 445 (1989). Rather, the Court notes that many statutory ambiguities are unintentional and may not reflect the true intent of Congress. The mere fact that statutory ambiguity involves an administrative agency does not mean that the Courts are excused from their responsibility to fulfill their traditional role of statutory interpretation. See: Loper Bright and Chevron.
When faced with an ambiguous statute, the Courts should not blindly defer to an administrative agency's interpretation. Instead, when a statute appears to delegate authority to an administrative agency, “the role of the reviewing court under the APA is, as always, to independently interpret the statute and effectuate the will of Congress subject to constitutional limits.” See Loper Bright. A Court engages in this task by recognizing “recognizing constitutional delegations, fixing the boundaries of the delegated authority, and ensuring the agency has engaged in “‘reasoned decision-making’” within those boundaries.” See Michigan v. EPA (quoting Allentown Mack Sales v. NLRB). Even though Courts will no longer blindly defer to an agency’s interpretation of a statute, such an interpretation can still be especially informative to the Court “to the extent it rests on factual premises within [the agency’s] expertise.” See: Bureau of Alcohol, Tobacco and Firearms v. FLRA and Loper Bright.
[Last updated in July of 2024 by Justin Cwiklinski with the Wex Definitions Team]