The limits of Loper Bright and the long decline of Chevron

Given the continuing discussion about the Supreme Court’s decision to overrule Chevron in Loper Bright Enterprises v. Raimondo, we thought that a review of the decision (and its limits) is in order. 

The Loper Bright decision

The 6-3 decision written by Chief Justice Roberts launched a full-throated attack on deference to administrative agencies:  “Chevron gravely erred”; it “required judges to disregard their statutory duties”; it is “fundamentally misguided,” “impressionistic and malleable.”  The Court concluded:  “Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority.”

Starting with first principles, the Court explained that the judiciary interprets the law.  That tradition persisted through the New Deal, the Court recounted, when decisions like Skidmore v. Swift & Co. permitted agency deference based only on the “power to persuade.”  The Court framed Chevron v. NRDC as a departure from that tradition by sometimes insisting on deference to agency interpretations.  When a statute is “silent or ambiguous,” Chevron required courts “to defer to the agency if it had offered ‘a permissible construction of the statute.’”  The majority criticized that rule as unworkable, as shown by subsequent efforts to clarify the standard (like US v. Mead Corp’s “step-zero” analysis) that “only added to Chevron’s unworkability, transforming the original two-step into a dizzying breakdance.”

In addition to those structural concerns, the Court relied on the Administrative Procedure Act, whose Section 706 instructs courts to “decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action.”  By contrast, the APA “does mandate that judicial review of agency policymaking and factfinding be deferential.”  The majority read the APA, like the constitution, to require courts to exercise “independent judgment on questions of law.” The majority also rejected the dissent’s stare decisis concerns, stating that “[r]ather than safeguarding reliance interests, Chevron affirmatively destroys them.” 

Justice Thomas and Justice Gorsuch separately concurred, the former focusing on separation of powers concerns and the latter addressing stare decisis concerns. Justice Gorsuch offered: “judges [play] a lawfinding rather than lawmaking role” that at times requires courts to “inter” bad precedents.  In dissent, Justice Kagan returned to her common theme of adherence to precedent, and she also defended Chevron deference as correct in the first instance.

The limits of Loper Bright

Despite overruling Chevron, the majority was clear that substantive holdings using the deference framework remain good law.  Loper Bright, after all, only affects agency rules or action that is based on statutory ambiguity or silence.  As under Skidmore, we can expect courts to continue to adopt agency rules and interpretations that are persuasive or backed up by significant experience.  Substantive holdings that Chevron produced are subject to their own stare decisis analysis, which applies with strongest force in statutory interpretation cases—as the Court itself recognized. 

In addition, deference to an agency’s interpretation of its own regulations (“Auer deference”) ostensibly remains good law; after all, the Court favorably cited Kisor v. Wilkie a handful of times.

There are other limits, including that Loper Bright only applies to an agency’s conclusions of law; it does not affect the traditional deference to agency factfinding.  The APA states that such findings of fact can be set aside only if they are “unsupported by substantial evidence.”  And nothing in Loper Bright prevents courts from interpreting statutes to recognize that Congress has delegated an agency wide discretion: “When the best reading of a statute is that it delegates discretionary authority to an 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.” 

Ultimately, the effects of Loper Bright will likely be on full display in fields subject to new or evolving regulation, as they will be more vulnerable to challenge without Chevron deference.

The long decline of Chevron

An interesting subplot to Chevron’s fall is that it has been coming for a long time–hopefully facilitating a smooth transition to the new standard.  The Court hadn’t “deferred to an agency interpretation under Chevron since 2016,” in Cuozzo Speed Technologies v. Lee.  To the dissent, this was a purposeful preparation “to overrule Chevron.”  The Court passed over many chances to defer, such as in cases like West Virginia v. EPA that present “major questions” of “deep … significance.”  Part of the dynamic, as the Court explained it, is that where “[o]ne judge might see ambiguity everywhere; another might never encounter it.”  The Court cited Judge Kethledge for the second proposition.  Judge Kethledge said in a 2017 article:  “I personally have never had occasion to reach Chevron’s step two in any of my cases.”

But not every Sixth Circuit judge can say the same.  In Valent v. Commissioner of Social Security, for example, the court finding the relevant statute ambiguous deferred to the Commissioner’s reasonable interpretation.  This prompted Judge Kethledge to dissent.  In a more recent case, Ohio v. Becerra, the Sixth Circuit applied Chevron because Supreme Court precedent interpreting the same statute compelled deference.  But the court observed a shifting “doctrinal landscape” that left “[t]he status of the Chevron deference doctrine … notoriously uncertain.”  (In Becerra, Chevron helped sustain part of an abortion-related HHS rule).

Reflecting the shift in administrative law, our review of Sixth Circuit cases shows that the court of appeals has been citing Chevron less and less – and for less-important reasons – over the past fifteen years.  For example, last year in Hardin v. ATF, the Sixth Circuit resorted to the rule of lenity instead of Chevron deference to resolve an ambiguity in favor of the private citizen by deciding that a semi-automatic gun equipped with a bump stock is not a machine gun—the same ruling the Supreme Court recently reached in Garland v. Cargill. As the Sixth Circuit maintains an active administrative law docket, its cases ushering in the Loper Bright era will be critically important.

Supreme Court GVRs Two Sixth Circuit Cases And Other Highlights from the Order List

The Supreme Court’s recent spate of high-profile decisions gives Court watchers much to process.  At this blog, we hope to explore many of those decisions as summer progresses.  In the meantime, we note a couple details from the Court’s Order List this week following its “clean-up conference.”

I count 30 cases the Court granted, summarily vacated, and remanded to the courts of appeals (GVR’d).  These were cases similar enough to Loper Bright, Rahimi, Erlinger v. United States, and other fresh decisions to merit a new look at the circuit level.  Two Sixth Circuit cases were GVR’d, both with instruction to apply Erlinger—Justice Gorsuch’s opinion that the Fifth and Sixth Amendments and Apprendi require a jury to find a defendant’s past, separate offenses before imposing the Armed Career Criminal Act’s mandatory minimum sentences.  In those two unpublished decisions, United States v. Thomas and United States v. Cogdill, the Sixth Circuit had affirmed the findings of ACCA-predicate offenses by a district court, not a jury.  Critically, however, both the Chief Justice and Justice Kavanaugh (joined by Justice Alito) stressed that violations of the right Erlinger recognized “are subject to harmless error review.” 

Further down the Order List, Justice Thomas and Justice Sotomayor wrote separate opinions related to two cert. denials in Sixth Circuit cases.  First up, Justice Sotomayor addressed the “absolute immunity [of] a prosecutor,” highlighting the “limits” of such immunity and other “safeguards” against prosecutorial misconduct.  This discussion arose from the case of Price v. Montgomery County, where the Sixth Circuit affirmed the dismissal of a §1983 action against a Kentucky prosecutor based on “a mix of absolute and qualified immunity.”  Justice Sotomayor found it “difficult to see how” the prosecutor’s “destruction of evidence to thwart a court order” enjoys immunity.

Meanwhile, Justice Thomas dissented from the Court’s cert. denial in Allstates Refractory v. Su.  In that case, the Sixth Circuit held that “the standard prescribed by the OSH Act [is] a constitutional delegation of authority” to OSHA.  The Act empowers OSHA to make Rules it deems “reasonably necessary or appropriate to provide safe or healthful employment.” 29 U.S.C. § 652(8).  Justice Thomas observed this is perhaps “the broadest delegation of power to an administrative agency found in the United States Code.”  Justice Thomas would have taken the case to reassess the “intelligible principle” standard that limits congressional delegations of authority to the Executive Branch.  Without joining the dissent, Justice Gorsuch signaled that he too would have granted review.  And, as Justice Thomas noted, other Justices have also signaled interest in adding teeth to the nondelegation doctrine, but this was not to be the case.

Notably, Judge Nalbandian wrote separately in both Price and Allstates Refractory.  He reviewed  history and recent scholarship and came away skeptical of the vitality of a prosecutorial immunity defense in a §1983 case.  Justice Sotomayor quoted his partial concurrence.  Judge Nalbandian also dissented at considerable length (28 pages) in Allstates Refractory, detailing his view that the OSH Act’s delegation fails “even under the minimal requirements” of the “intelligible principal” standard.

Rounding out this eventful Order List, the Court granted review in 5 new cases.  These include a free speech case, a case involving the FDA’s attempt to regulate vapes, an immigration case, and finally two consolidated cases on criminal sentencing under the First Step Act.  The last cases are significant because the Supreme Court denied a petition out of the Sixth Circuit that raised the same issue, after six judges dissented from the denial of rehearing en banc.  The Court is expected to issue three more order lists this summer, but any fireworks are unlikely.

Here’s to a happy Independence Day!

En Banc Court Hears First Amendment Challenge to Campaign Finance Restriction

Congratulations are in order to the forty-something law clerks that swore in to the Sixth Circuit bar Wednesday.  That was a prelude to the court’s en banc argument on campaign finance restrictions in National Republican Senatorial Committee v. FEC.  The Committee challenges the constitutionality of part of the Federal Election Campaign Act that places limits on political parties’ “coordinated party expenditures.” 

Notably, the en banc court is taking the first pass on the constitutional question.   The Act includes a unique judicial review provision that requires the district court to “immediately … certify all questions of constitutionality of this Act” to the court of appeals to “hear the matter sitting en banc.”  All 16 of the Sixth Circuit’s non-senior judges sat for the lively argument.

In limiting “coordinated party expenditures,” the Act caps the amount a party may spend on activities like political advertising for a candidate.  Even if that spending limitation serves the legitimate objective of limiting corruption and its appearance, the Committee argued, the restriction violates the core First Amendment right to associate with the political candidate of one’s choosing under seminal precedents like Citizens United, McCutcheon, and the 2022 Cruz decision (all versus FEC). 

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Sixth Circuit Grants P.G. Sittenfeld Release from Prison Pending Appeal

Today, the Sixth Circuit took the relatively rare step of granting a criminal defendant’s release from prison before deciding the merits of his case.  That followed last week’s oral argument in the high-profile criminal appeal of Alexander “P.G.” Sittenfeld, the former Cincinnati City Councilperson.  Sittenfeld’s counsel closed his rebuttal argument by renewing his request for release from prison pending appeal, in advance of the Court issuing its opinion.  The court granted that relief today (subject to conditions) in a per curiam order.  This interim relief is a positive development for Sittenfeld, though the court was careful to “express no opinion on the ultimate outcome of Sittenfeld’s appeal.”  The briefs and oral argument satisfied the panel that Sittenfeld at least met “the standard for release pending appeal.”

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Bettors Beware: Read Sixth Circuit Before Wagering on the Kentucky Derby

Tomorrow marks the first Saturday in May, so the sporting world will turn its attention to Louisville, Kentucky for the 150th running of the Kentucky Derby at Churchill Downs.  Perhaps $200 million will be wagered on “the fastest two minutes in sports.”  And while the Derby is “the most storied race of them all,” West v. Kentucky Horse Racing Comm., 972 F.3d 881, 883 (2020), Churchill Downs will play host to 26 more horse races this weekend—on all of which wagers will be placed.  The proliferation of sports gambling in conjunction with this weekend’s run for the roses makes Judge Cole’s opinion for Sixth Circuit in Mattera v. Baffert all too timely.

This week in Mattera, the Court clarified that, under Kentucky’s law of pari-mutuel race betting, the “first order of finish marked ‘official’ counts for wagering purposes.”  That means, if a horse wins, places, or shows—finishes in the top three—only to be later disqualified and retroactively scratched from the race, bettors on the pre-disqualification finish are in luck.  “A subsequent change in the order of finish may affect the purse and the history books,” the Court explained, “but it will not impact pari-mutuel wagering.”

The 147th running of the Kentucky Derby in 2021 brought these rules to life.  Thoroughbred Medina Spirit led from wire to wire.  The race stewards marked the official finishing order as: (1) Medina Spirit, (2) Mandaloun, (3) Hot Rod Charlie, (4) Essentially Quality.  Wagers were paid out accordingly.  But several months later, the Kentucky stewards disqualified Medina Spirit (posthumously) and crowned Mandaloun the winner.  Medina Spirit tested positive for a performance enhancing substance after the race.

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The Ohio Supreme Court Updates its Writing Manual

Last week, the Ohio Supreme Court published a new and improved writing manual.  The Third Edition is “a comprehensive guide . . . designed to improve the readability of opinions issued by, and briefs filed in,” Ohio’s courts.  The unquestionable headline is that the new manual abandons the cumbersome triple-parallel-citation format of old in favor of citing just the Ohio online reporter, like so: Smith v. Ohio State Univ., 2024-Ohio-764, ¶ 2.

An overview of notable changes includes:

  • A new, streamlined way to cite the U.S. Supreme Court.  E.g., Dutton v. Evans, 400 U.S. 74, 77 (1970).
  • New uniformity for citations to the Ohio courts of appeals (eliminating the case number and placing the court in parentheses).  E.g., State v. Jones, 2003-Ohio-5994, ¶ 6 (10th Dist.).
  • Streamlined short cites for cases cited more than once.  E.g., Smith at ¶ 21.
  • Abbreviated citations to State and the U.S. Constitutions.  E.g., Ohio Const., art. IV, § 2(B)(1)(g).
  • The introduction of ellipses (. . .) instead of stars (* * *) for omissions in quotations.
  • A qualified approval of the “cleaned up” parenthetical that this Blog has previously investigated.

These and other changes bring Ohio to the “forefront in modernizing legal writing,” said the revision committee’s Chair, Justice R. Patrick DeWine.  Justice Melody J. Stewart also served the committee, which Chief Justice Sharon L. Kennedy convened in 2023.  Below, we select a few other updates to highlight, but practitioners might look closer at the 172 pages, in particular because the Court’s Rules of Practice commend the Writing Manual “for guidance on the style of documents filed with the Supreme Court.”  S.Ct.Prac.R. 3.01.

The Third Edition, recognizing that “parallel case citations are no longer necessary or helpful,” makes “changes intended to simplify and modernize citation forms.”  The new manual confronts a tension familiar to all legal writers:  Nearly every sentence in a legal argument requires citation, and yet “they are not very readable.”  The new manual does yeoman’s work toward simplification, and therefore readability, that practitioners and opinion readers (us included) will doubtless applaud.

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While We Are Waiting On Chevron

The Supreme Court issued three opinions today, including an important decision on whether omissions in SEC filings are actionable, and a decision that the Takings Clause does not distinguish between legislative and administrative land-use permit conditions (and that relies on Judge Murphy’s recent Takings Clause decision). But no decision yet on the highly-anticipated blockbuster cases (here and here) that might overturn Chevron deference.

While we continue waiting for those decisions, we’ll point you to an interesting article by our colleague Keith Bradley. The article acknowledges that Chevron privileges the policies of government agencies over those of individual people and businesses that disagree with those policies. But then it argues that the doctrine also gives agencies flexibility to operate under the often-ambiguous laws passed by Congress, which may create positive outcomes for other individuals and businesses outside of litigation.

Justice Sotomayor References Rarely Used Procedure: Circuit Certification to U.S. Supreme Court

Four years ago, the Supreme Court declined a federal habeas petitioner’s request to review the Sixth Circuit’s decision in Avery v. United States, 770 F. App’x 741.  Justice Kavanaugh, the Sixth Circuit’s assigned circuit justice, attached a “statement” to the Supreme Court’s cert. denial to highlight a circuit split that Avery implicated and to note his interest in revisiting the issue “[i]n a future case.”  140 S. Ct. 1080, 1081 (2020).  The same issue returned to the Supreme Court this February, this time on an original habeas petition filed directly with the Court.  But the Court turned it away.  See Sup. Ct. R. 20.4(a).  Justice Sotomayor wrote her own “statement” to “join [Justice Kavanaugh]” in “his desire . . . to resolve th[e] split.”  In re Bowe, No. 22-7871 (U.S. Feb. 20, 2024).  Justice Sotomayor identified a three-fold practical impediment to Supreme Court review of the issue (which gets into the weeds of AEDPA, see 28 U.S.C. § 2244(b)(3)(E)), but concluded by offering solutions.

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Pump Your Brakes: Sixth Circuit Warns District Courts to Make “Rigorous” Rule 23 Analysis

The Sixth Circuit yesterday in a per curiam opinion (paneled by Judges Boggs, Thapar, and Readler) accepted interlocutory appeal of and vacated a class certification order from the Eastern District of Michigan.  The case is In re: Ford Motor Company, Case No. 22-0109 (6th Cir.). The Court’s opinion served to remind district courts that they must conduct a “rigorous analysis” to determine whether “not one or two, but all four Rule 23(a) prerequisites are met.”  Op. at 2.  It is worth noting that on interlocutory appeal, the circuit court typically either denies review or accepts the case for briefing on the merits.  In this case, however, the Sixth Circuit accepted review and summarily vacated to allow the district court to correct its error, without further briefing. 

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Sixth Circuit Reverses Grants of Preliminary Injunctions in Gender Dysphoria Cases

Yesterday evening, the Sixth Circuit issued a blockbuster decision in consolidated cases addressing the constitutionality of Tennessee’s and Kentucky’s laws limiting minors experiencing gender dysphoria from certain sex-transition treatments. Chief Judge Sutton wrote the majority opinion, which Judge Thapar joined. Judge White dissented. The majority and dissenting opinions cumulatively span over 70 pages.

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