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Regulatory Update: Chevron Doctrine Could Face Changes

Regulatory Update: Chevron Doctrine Could Face Changes

CHEVRON DOCTRINE MAY FACE CHANGES; COULD CAUSE BROAD IMPLICATIONS FOR HOW AGENCIES ENACT NEW REGULATIONS 

Last week, the US Supreme Court heard arguments in two significant cases that could dramatically impact the ability of all federal agencies, including the U.S. Department of Education, to promulgate new regulations. The two cases were Loper Bright Enterprises, Inc. v. Raimondo and Relentless, Inc. v. Department of Commerce.

In each case, the Court examined what level of deference, if any, federal courts should give to agencies when they promulgate regulations to implement statutes passed by Congress. Under current Supreme Court precedent, known as the Chevron doctrine, when a statute is silent or ambiguous on a specific issue, courts must defer to agency interpretation so long as the interpretation is reasonable.

The Chevron doctrine, which has stood since 1984, now appears to be in jeopardy. During oral argument in the Loper Bright and Relentless cases, the Court’s conservative justices (who hold a 6-3 majority) are reported to have been skeptical of Chevron. While lawyers representing the federal government argued the doctrine should stand to preserve predictability, several justices openly disagreed. Justice Gorsuch characterized Chevron as a “recipe for instability … because each new administration can come in and undo the work of a prior one.” Justice Kavanaugh stated, “[Y]ou say don’t overrule Chevron because it would be a shock to the system, but the reality of how this works is Chevron itself ushers in shocks to the system every four or eight years when a new administration comes in, whether it’s communications law or securities law or competition law or environmental law, and goes from pillar to post.”

Based on the oral arguments, it has been widely reported that the Court is likely to either overturn or significantly limit the Chevron doctrine moving forward. This would have broad implications for how agencies enact new regulations in the future and how courts review challenges to federal regulations, potentially including the ongoing challenge by AACS to the Department of Education’s “gainful employment” rule. However, until the Supreme Court issues its decision, it will not be clear how, if at all, AACS members will benefit from any changes to the Chevron doctrine.

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