Federal Judges Find New Power as Chevron Precedent Falls Away

Chevron deference doesn’t mean the Conoco station fuel isn’t as good.

According to the U.S. Supreme Court, Chevron deference has run out of gas — in a legal sense. The elimination of that 40-year-old precedent last June may upend the regulatory landscape across the Rocky Mountain West. It is woven deep within almost every lawsuit involving energy development, the Endangered Species Act, forest management, pollution control, water use and similar federal fighting words. 

“What kinds of public lands cases does it affect? I would say every one,” Montana environmental law attorney Tim Bechtold said. “I don’t know of a single timber sale case, ESA case or water case where Chevron wasn’t in the background.”

Chevron deference arose from the 1984 Supreme Court decision in Chevron v. Natural Resources Defense Council. Federal judges first look to Congress for laws governing federal actions. But if the law wasn’t clear, or Congress delegated rule-making power to a federal agency, “Chevron deference” directed judges to defer to the agency’s interpretation of the law, as long as it was reasonable. The presumption was that those agencies had the scientific, financial or technical experts needed to administer the will of Congress.

For example, the Endangered Species Act gives grizzly bears protection as a threatened species in all the Lower 48 states. When the U.S. Fish and Wildlife Service published its new rule for recovering grizzlies, it revised that 48-state range to just Washington and parts of Montana, Idaho and Wyoming. This area is known as a Distinct Population Segment, or DPS.

“The Fish and Wildlife Service has a policy that allows for listing and delisting geographically discrete populations,” said Earthjustice attorney Tim Preso of Bozeman. “Those distinct population segments, and the Service’s authority to declare their discreetness and significance, was upheld by the courts on Chevron grounds. It’s fundamental to ESA cases.”

Stakeholders challenging a government action might present their own experts in court, hoping to show the government’s position was unreasonable or unfounded — what the law calls “arbitrary and capricious.” Chevron deference made that a high bar, because it directed judges to assume the administrative agency had the best collection of facts. 

Justice John Paul Stevens wrote the original Chevron opinion, and noted that judges “are not experts in the field, and are not part of either political branch of Government.” In other words, someone with a juris doctorate degree may know little about grizzly population dynamics, mine waste hydrology or forest regeneration rates, but they will have to make decisions on those highly technical fields. Agencies do have experts in those fields, and Stevens noted, they are responsive to voters who can elect new political leaders if they don’t like the current ones.

But in the Supreme Court case Loper Bright Enterprises v. Raimondo last June, a six-justice majority ruled that judges “must now exercise their independent judgment in deciding whether an agency acted within its statutory authority, even when a statute is ambiguous,” according to the Sidley Environmental and Energy Brief of the case. The review added it anticipated challenges to Environmental Protection Agency regulations, especially those related to the Clean Air Act. That law, passed 54 years ago, has no reference to climate change yet is being used to regulate greenhouse gas emissions.

Robert Klee at the Yale Center for Business and the Environment said Supreme Court Chief Justice John Roberts’ ruling replaced judicial humility with hubris.

“Roberts declared that there must always be a ‘single, best meaning’ of a statute, and judges — not agency experts — should have the final say on what’s best for all of us, no matter how complicated or technical the subject matter,” Klee wrote. “This seismic shift resets the balance of power between branches of government (generally favoring the courts) and between regulators and regulated industries (generally favoring the regulated).”

In her dissenting opinion, Justice Elena Kagan warned of a “massive shock to the legal system” as stakeholders unhappy with federal regulations act on this chance to rewrite the rulebooks. But that could cut multiple ways, as both defenders and developers of public lands have hit agency roadblocks in court.

“There are a number of federal agencies, like the U.S. Forest Service and the Bureau of Land Management, which manage most of the federal public lands, that have been largely captured by the entities they regulate — timber companies, mining interests, etc.” Stanford Law Professor Deborah Sivas wrote. “These agencies often seek Chevron deference for pro-development and pro-extraction rules and decisions. Many of our community partners in those circumstances might well be happy to see Chevron gone.”

Earthjustice’s Preso added that the opinion appears to discourage re-litigating old cases decided by Chevron deference.

“The Supreme Court wasn’t looking to totally upset the apple cart on every past decision where Chevron played a role,” Preso said. “For example, the DPS decision would get some consideration as precedent, because it was decided under a different rule of Chevron than today. But going forward, when statutory interpretation comes up, it’s the judge’s discretion.”

Ironically, the federal court decision giving judges more leeway cuts counter to the debate going on in Montana government, where some Republican legislators have filed at least 27 bills intended to overhaul the judicial branch, including bills to impeach judges and give the Legislature powers to override the state Supreme Court on interpreting constitutional matters.