The U.S. Supreme Court Just Gave Federal Agencies A Big Reason To Worry

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(Reuters) – The U.S. Supreme Court’s decision on Thursday to block the Environmental Protection Agency from regulating greenhouse gas emissions risks putting a damper on rule-making by d other federal agencies.

The justices, in a 6-3 opinion written by Chief Justice John Roberts, formally adopted a doctrine that has gained popularity in recent years as justification for restricting agency power. The major issues doctrine, as the principle is now formally known, holds that in “extraordinary” cases involving matters of great “economic and political importance”, federal agencies must be able to indicate specific congressional authorization for their actions. Courts should otherwise be “skeptical,” according to the ruling, that agencies have the power to set policy through new legislative approaches.

At the very least, seven administrative law experts told me, the newly formalized doctrine will discourage regulators from aggressively pushing innovative policies in politically charged cases, especially because the Supreme Court has failed to establish a clear test for know when the major issues doctrine should be invoked.

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In the past, as Roberts wrote in Thursday’s ruling, the court has relied on doctrinal reasoning to prevent the Food and Drug Administration from regulating cigarettes; the Centers for Disease Control and Prevention to ban evictions during the pandemic; and the Occupational Safety and Health Administration to impose Covid vaccine rules on big business.

The new doctrine, according to experts, leaves a lot of room for interpretation. “My fear is that anything coded as ‘controversial’ in certain circles or politically salient more generally will hit the court as ‘major,'” University of Michigan law professor Daniel Deacon said in a statement. E-mail. “It will leave the agencies with many smaller responsibilities (although they are still important), but it could prevent them from dealing with some of the most serious problems facing the country, as we have seen now in the context of COVID-19 and the climate crisis.”

Scott Nelson of Public Citizen added: “Right now, whether a case involves a major issue seems to hinge on whether Chief Justice Roberts and Justice [Brett] Kavanaugh thinks so.

Among the agencies likely to feel the chill include the Securities and Exchange Commission and the Federal Trade Commission, both of which are engaged in aggressive regulation to address issues that Congress never considered in the decades-old statutes that have created the committees.

Jonathan Adler of Case Western Reserve University and Evan Bernick of Northern Illinois University both told me that the SEC’s proposed rule to require climate-related disclosures from public companies is vulnerable under the major issues doctrine. George Washington University law professor Richard Pierce cited new rules the FTC is considering for corporate mergers. Pierce said the Supreme Court’s major issues doctrine will make it harder for the FTC to defend new rules that opponents may call unprecedented — a description, Pierce said, that opponents will surely apply to a broad range of FTC initiatives.

A caveat: One expert, Daniel Farber of UC Berkeley Law School, argued against the broad consensus on the new doctrine’s deterrent effect. Farber said by email that the court appeared to be raising the bar for invoking the major issues doctrine by pointing to the EPA’s unprecedented attempt to use an arcane provision to venture into a new area of ​​regulation. (The EPA case involved systemic rules for coal-fired power plants.)

But not everyone agrees on the consequences of the decision. Kent Barnett of the University of Georgia said via email that the major issues doctrine has been in the making for decades. “If I were advising the agencies on the scope of their regulatory power, my advice would have been the same yesterday as it is today – the Supreme Court will be very skeptical of sweeping pro-regulatory interpretations,” Barnett said.

Regulator skeptics, meanwhile, hailed the move to restore power to Congress. The New Civil Liberties Alliance, which filed an amicus brief supporting challengers to the EPA’s potential emissions regulations, said in a press release that the decision properly ensures that “major decisions affecting people’s lives must be made by the people’s representatives in Congress, not by unelected bureaucrats.

In the short term, you can expect a slew of challenges to Biden’s administrative policies under the Major Issues Doctrine. Even if the Supreme Court intends the new test to apply only in extraordinary cases, as Roberts said in the opinion, the challengers are unlikely to be as discerning when they take legal action. to block rule-making.

“It’s a new arrow in the quiver,” said Case Western’s Adler. “You will see attorneys general trotting this in every case.”

Major question challenges have the added benefit of circumventing the nuanced analysis required by the traditional framework for assessing agency authority. The frame, taken from Chevron v. Natural Resources Defense Council of 1984, calls on the courts to defer to federal agencies to interpret the laws they apply. But Chevron never even comes into play if the major issues doctrine applies, since the doctrine is based on statutory limitations on the agency’s authority. So, at least until the lower courts begin to clarify the outer contours of the new doctrine, challengers to the rules are likely to view it as a more blunt and wielding instrument than Chevron.

“This is a significant threat to the regulatory power of agencies,” said University of Michigan law professor Nina Mendelson, who described the decision as “an anti-regulatory power grab by the court. “.

When Congress passed laws creating agencies like the SEC and FTC decades ago, Mendelson said, lawmakers used broad language that would allow regulators to respond to new issues. The Major Issues Doctrine, by urging courts to look with skepticism at agency regulation not specifically authorized in these old statutes, “will prevent an agency from regulating unless Congress legislates twice by reverting to back and passing a specifically worded second law,” Mendelson said.

She’s not the only one warning of dire consequences. GW’s Prof Pierce said the new doctrine “is going to prevent agencies from taking many actions that they would like to take”. With Congress locked in on major legislation, Pierce said, agencies have no choice but to rely on broadly worded laws enacted before Congress has a clue of the issues. of today. Historically, this broad formulation has allowed regulators to adapt to new issues. But the Supreme Court’s major issues doctrine, Pierce said, turns old laws into restraints on agency power, instead of tools of flexibility.

“Basically,” said Brian Frazelle of the Constitutional Accountability Center, “this in an anti-regulatory doctrine.”

Read more:

US Supreme Court limits federal power to cut carbon emissions

US Supreme Court blocks Biden’s vaccine or test policy for big business

US Supreme Court ends CDC’s pandemic residential eviction moratorium

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Alison Frankel

Thomson Reuters

Alison Frankel has covered high-stakes commercial litigation as a columnist for Reuters since 2011. A graduate of Dartmouth University, she worked as a journalist in New York covering the legal industry and law for more than three decades. Before joining Reuters, she was an editor and editor at The American Lawyer. Frankel is the author of Double Eagle: The Epic Story of the World’s Most Valuable Coin.

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