By Jennifer Cordell

On January 17, 2024, the Supreme Court heard oral arguments in tandem cases Loper Bright Enterprises v. Raimondo and Relentless, Inc., et al. v. Dept. of Commerce, et al., which ask whether the court should overrule one of its most frequently cited precedents: the Chevron doctrine.^[1]

Background

The Loper Bright and Relentless cases bring the Magnuson-Stevens Fishery Conservation and Management Act (the MSA) before the Supreme Court. In reviewing these two cases, the court has the opportunity to affirm, overrule, or clarify the Chevron doctrine.

The MSA regulation^[2] was initially enacted to respond to the threat of overfishing and “to promote conservation.”^[3] Through a regulatory scheme that involves eight regional councils that manage fisheries in their respective regions, fishery management plans are implemented to manage fishery yields and permits, and generally put into place rules that will fulfill the purpose of “prevent[ing] overfishing…protect[ing] fish stocks…and promot[ing] the sustainability of each fishery.”^[4] The responsibility for reviewing the submission of fishery management plans lies with the Secretary of Commerce, who has delegated the responsibility to the National Marine Fisheries Services (NMFS, an administrative agency that is a division of NOAA).^[5]

The New England Fishery Management Council is one such regional council that submitted a fishery management plan to NMFS for review and approval. The Atlantic herring fishery is subject to the rules promulgated under the New England Fishery Management Council’s fishery management plan. As approved, the plan “includes an annual catch limit and restrictions on the location and timing of herring fishing.”^[6] Under Section 648.11 of the plan, the Atlantic herring fishery is subject to monitoring by government-funded observers measuring fish unintentionally caught on their fishing trips (bycatch).^[7]

In 2020, a final rule regarding the implementation of industry-funded monitors (observers) aboard vessels fishing for the herring fishery was published. The rule sets a target for an observer to be aboard Atlantic herring fishing trips 50 percent of the time.^[8] While the government carries the burden of administrative expenses related to the program for observer coverage under the Standardized Bycatch Reporting Methodology (SBRM), there is additional industry-funded monitoring required. If a fishing vessel does not meet one of three potential waiver circumstances, then the vessel could be asked to carry a monitor (observer) at its own expense. Based on an Environmental Assessment cited in Relentless, the cost is approximately $700 per day for a monitor to be carried aboard the fishing vessels.^[9]

The petitioners in the Loper Bright and Relentless cases are Atlantic herring fishermen who may stay at sea for upwards of one to two weeks, sometimes with zero catch for their efforts. Carrying observers aboard their vessels for such a long period of time could almost certainly leave them in the red. The fishermen petitioned the Supreme Court to answer the question of whether statutory silence on a particular issue means that the administrative agency is owed deference to their interpretation (or promulgation of regulation in absence of particular language), requiring them to bear the costs of carrying observers aboard their vessels.

In response, the government argued that stare decisis required the court to rely on its prior decision in Kisor v. Wilkie to guide its decision-making process here in upholding Chevron.^[10] The justices in Kisor refused to overrule Auer deference, a doctrine giving deference to administrative agencies to interpret their own rules.^[11] It should be noted that in his concurrence, Justice Roberts distinguished Auer from Chevron, indicating that the Kisor decision did not “touch upon” Chevron deference.^[12]

Chevron Overview

The Chevron doctrine, or Chevron deference, as it has become known, is the result of the landmark 1984 decision compelling courts to defer to an administrative agency’s reasonable interpretation of ambiguous statutes.^[13] A long-standing doctrine with prolific reach due to its application to all administrative regulations, Chevron has been cited over 100,000 times in case law throughout its precedential tenure.^[14]

Chevron lays out guidelines for evaluating an administrative statute containing language that is alleged to be ambiguous or unclear in a two-step test:^[15]

1. As a threshold inquiry, a court asks whether Congress has made its intent known expressly in the language of the statute, and whether it is unambiguous.

a. If the intention of Congress is unambiguously stated in the language of the statute, then the inquiry must end. The courts must give effect to the unambiguously expressed intent of Congress.

b. If, however, the intent of Congress is ambiguous, or if the statute lacks express language on a specific point, then a federal court must decide whether the agency interpretation is based on a permissible construction of the statute.

2. In examining the administrative agency’s reasonable interpretation/construction of a particular statute, a court must assess whether Congress explicitly or implicitly left an ambiguity or failed to include express language.

a. If the decision of Congress was explicit, then the agency’s regulations are binding on federal courts unless those regulations are arbitrary, capricious, or manifestly contrary to statute.

b. If the decision of Congress was implicit, then so long as the agency’s interpretation is reasonable, a federal court cannot substitute its own statutory construction superior to the agency’s construction.

The circuit courts have been split on their rulings as to Chevron challenges. In deciding the tandem Loper Bright and Relentless cases, the Supreme Court has a number of available avenues.

The Fifth Circuit’s “Plot Line” Approach

Petitioners and the government are relying on several cases to support their alternate positions in Loper Bright/Relentless. In 2022, the Fifth Circuit overruled an Order of the Federal Energy Regulatory Committee (FERC) that applied Chevron deference in directing an administrative law judge to determine reasonable costs for Midship Pipeline Company, L.L.C. (Midship) to complete remediation efforts at Sandy Creek Farms in Oklahoma.^[16]

Midship constructed and began operating a pipeline that crossed privately held land in Oklahoma with approval from FERC pursuant to the Natural Gas Act (NGA). Midship ultimately became the target of disputes with Sandy Creek landowners due to “unresolved restoration issues.”^[17] The parties attempted to negotiate and settle their disputes through FERC’s Dispute Resolution Service. Although they agreed on the scope of the remediation needed, they came to an impasse, primarily because Sandy Creek preferred Midship to compensate them for remediating the land instead of performing the remediation efforts.^[18]

As a result, FERC entered an order declaring an impasse and appointed an administrative law judge to resolve two questions, one of which was to determine the reasonable cost to complete remediation measures.^[19] Midship petitioned the Fifth Circuit to review the FERC decision, claiming it lacked the authority to determine the reasonable costs of the remediation efforts under the NGA.^[20] In turn, FERC claimed, among other arguments, that its interpretation of the NGA should be afforded deference under Chevron.

The Fifth Circuit disagreed. Rather than engage in the two-part Chevron test, the court analyzed whether Chevron should be used as an applicable framework at all in relation to FERC’s authority to determine reasonable costs to complete the remediation measures.^[21] The court found that FERC “changed the plot line” of its enabling legislation by giving itself power to determine reasonable costs, which was not in the plain language of the statute^[22]: “Agencies have only those powers given to them by Congress, and ‘enabling legislation’ is generally not an ‘open book to which the agency [may] add pages and change the plot line.”^[23]

While the facts do not entirely align with Loper Bright/Relentless, the Supreme Court could very well chart a similar path in analyzing Chevron and addressing the issue of statutory silence.

Jennifer Cordell is a staff attorney at Schiffer Hicks Johnson PLLC, a Houston-based trial law firm.

[1] Loper Bright Enterprises, Inc. v. Raimondo, 45 F.4th 359 (D.C. Cir. 2022), cert. granted in part sub nom. Loper Bright Enterprises v. Raimondo, 143 S. Ct. 2429, 216 L. Ed. 2d 414 (2023); Relentless, Inc. v. United States Dep’t of Commerce, 62 F.4th 621 (1st Cir. 2023), cert. granted in part sub nom. Relentless, Inc. v. Dep’t of Commerce, 144 S. Ct. 325, 217 L. Ed. 2d 154 (2023).

[2] Found at 16 U.S.C. §§1801.

[3] Relentless at 625.

[4] Id. at 625.

[5] Id.

[6] Id. at 625 (citing 50 C.F.R. §648.200).

[7] Id. at 625.

[8] Id. at 626.

[9] Id.

[10] Kisor v. Wilkie, 139 S. Ct. 2400, 204 L. Ed. 2d 841 (2019).

[11] Id. at 2418.

[12] Id. at 2425.

[13] Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 694 (1984).

[14] “Kisor asks us to overrule not a single case, but a ‘long line of precedents…’” 139 S.Ct. at 2422.

[15] 467 U.S. at 873.

[16] Midship Pipeline Company, L.L.C. v. Federal Energy Reg. Comm.¸45 F. 4^th 867, 870 (2022).

[17] Id. at 871.

[18] Id.

[19] Id.

[20] Id.

[21] Id. at 874.

[22] Id. at 877.

[23] Id. at 876.