Supreme Court Case Threatens to Drastically Reduce Federal Regulatory Power in Environmental and Healthcare Sectors

WASHINGTON, D.C. – The Supreme Court heard oral arguments on Jan. 17, 2024, in two cases that could have far-reaching implications for federal regulatory power. The cases, Loper Bright Enterprises vs. Raimondo and Relentless Inc. vs. Department of Commerce, focus on fisheries management but carry implications for broader federal enforcement of environmental and health care regulations. The central question in these cases is whether the Secretary of Commerce, through the National Marine Fisheries Service, has the authority to require commercial fishers to pay for onboard observers on fishing voyages, as mandated by the Magnuson-Stevens Fishery Conservation and Management Act.

The plaintiffs in these cases argue that the Commerce Department has exceeded its legal authority, challenging the long-standing Chevron deference in federal administrative law. This legal doctrine, established in a 1984 Supreme Court case, dictates that when a federal statute is ambiguous or silent on a regulatory issue, courts should defer to the reasonable interpretation of the implementing agency. In other words, the agency’s interpretation takes precedence over the courts’ if it is deemed reasonable.

During the oral arguments, the justices raised concerns about legal stability, past rulings, and the balance of power between federal courts and agencies. The justices also expressed differing views on statutory interpretation. While some justices questioned the potential repercussions of overturning Chevron deference, others highlighted the potential for legal instability caused by deferring to regulators.

At the heart of these cases is the issue of who should bear the costs of fishing observers. Under the Magnuson-Stevens Act, Fishery Management Councils regulate fisheries in federal waters. These councils can require fishing boats to carry observers who monitor their catch and collect data on various aspects of fishing. However, the law does not explicitly state whether the fishing industry should bear the costs of these observers.

The plaintiffs, Loper Bright and Relentless Inc., argue that requiring fishing boat owners to pay for observers can significantly impact their profits. They contend that the cost of observers, which can reach up to $710 per day, cuts into their revenues. The challengers in the Relentless Inc. case also argue that they are unfairly burdened with higher costs due to their fish-freezing equipment that allows for longer trips, even though they may not be fishing for herring on many days.

The Supreme Court’s decision in these cases could have broader implications for the deference given to federal agencies in interpreting and enforcing laws. Critics of Chevron deference argue that it allows agencies to exceed their intended authority and encroaches on the judiciary’s role of interpreting the law. They contend that limiting deference would reaffirm the responsibility of federal agencies to operate within the explicit bounds set by Congress.

If the Supreme Court decides to limit or overturn Chevron deference, it could have significant implications for federal agencies’ ability to address new and emerging issues and regulate effectively. It would place greater emphasis on clear directions from Congress and limit agencies’ flexibility in responding to contemporary needs in areas such as health care, environmental protection, workplace safety, and technology.

Overall, the outcome of these cases will have substantial ramifications for federal regulatory power and the balance between branches of government in interpreting and enforcing laws. With the increasing skepticism towards Chevron deference, this could mark a significant shift in the landscape of administrative law in the United States.