Chevron Doctrine

The Centers for Medicare and Medicaid Services (CMS) has deferred taking immediate action on its low wage index hospital policy in light of the US Court of Appeals for the DC Circuit’s decision in Bridgeport Hospital v. Becerra. While the CMS’s final rule for FY 2025 continues the policy for now, this move signals a potential shift as the agency reviews the court’s ruling and its potential impact on future Medicare payment policies.

In Loper Bright Enterprises v. Raimondo and Relentless Inc. v Department of Commerce, the Supreme Court held that both the United States’ constitutional structure and the Administrative Procedure Act preclude a court from deferring to administrative agencies when they interpret ambiguous statutory text. Instead, the court must assess the “best meaning” of the statute using traditional tools of statutory construction.

In a decision on the US Environmental Protection Agency’s risk assessment of a chemical included in its Miscellaneous Organic Chemical Manufacturing (MON) rule, the US Court of Appeals for the District of Columbia Circuit reiterated that agency determinations of fact on scientific issues are entitled to “extreme deference.”

This mid-year report offers an overview of the sector's latest developments—including regulatory and legislative updates, enforcement actions, the impact of certain US Supreme Court decisions, and technological advancements—and what they mean for the nuclear industry.

The US Supreme Court’s decision in Loper Bright Enters. v. Raimondo and Relentless v. Department of Commerce has raised questions regarding the future of financial services regulation, including by the US Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and the US Department of Labor (DOL). While the decision is beneficial to those who wish to challenge these regulators, the practical impact may simply reinforce a judicial trend to overturn rules in this space.

The US Supreme Court’s recent Loper Bright decision overturned its 1984 Chevron decision, which, over the last 40 years, had become a fundamental doctrine in administrative law. That doctrine, known as the “Chevron deference,” instructed reviewing courts to defer to agency interpretations of ambiguous statutory provisions if a permissible construction of the statute. While many agencies relied on Chevron deference to defend challenges to their rulemakings and other regulatory actions, the NRC has rarely needed to do so.

With the US Supreme Court’s June 28 decision in Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce, the four-decades Chevron doctrine is no longer. While the Court’s decision has altered administrative jurisprudence as we have come to know it, its impact on labor and employment agency action may vary from sweeping change to a continuation of the status quo. This LawFlash presents a brief summary of the expected impacts for labor and employment law practitioners.

The US Supreme Court on June 28 overruled longstanding precedent and expanded the ability of government contractors to challenge agency interpretations and applications of certain statutes. In Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce (Loper Bright), the Court set aside the 40-year Chevron doctrine and held that courts may no longer defer to an agency’s interpretation of an ambiguous statute. Instead, courts must exercise their own judgment to assess the agency’s statutory interpretation by employing the usual tools of statutory interpretation, such as considering the plain language and congressional intent.

The US Supreme Court’s decision in Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce, which overrules the longstanding Chevron doctrine that required federal courts to defer to administrative agencies’ interpretations of ambiguous or broad statutes, represents a fundamental change in administrative law that will have a substantial impact on all regulated industries. Because life sciences is one of the most highly regulated industries, we have prepared this LawFlash focused on many of the issues that life sciences companies may be facing in light of Loper Bright.

The US Supreme Court’s June 28, 2024 decision in Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce overruled the forty-year-old Chevron U.S.A. Inc. v. Natural Resources Defense Council Inc. decision, one of the most-cited cases in US law. This development will have far-reaching impacts, and for intellectual property (IP) law specifically, it could significantly affect how the Court approaches US International Trade Commission (ITC) litigation.

The US Supreme Court’s opinion in the Loper Bright v. Raimondo and Relentless v. Commerce cases overruling the rule of deference to agency interpretations of federal statutes established by its decision 40 years ago in Chevron USA Inc. v. NRDC will have far reaching consequences for the interpretation, administration, and promulgation of US environmental laws.

On June 28, 2024, the US Supreme Court decided Loper Bright Enterprises v. Raimondo and Relentless, Inc. v. Department of Commerce, which ended the era of judicial deference to agencies’ interpretations of federal law, as expressed in formal rules and regulations. The decision will have far-reaching impacts on all federal agencies, including the US Department of the Treasury and Internal Revenue Service, as well as for taxpayers.

The US Supreme Court on June 28 decided Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce, overruling the Chevron doctrine that for four decades has required federal courts to defer to administrative agencies’ interpretations of ambiguous or broad statutes. The doctrine was a foundation of administrative law and afforded successive US presidential administrations flexibility to interpret statutes via agency adjudications and rulemaking. The Court’s decision will have substantial impact on both regulated industries and agencies.

In a 6-3 decision, the US Supreme Court on June 27, 2024, in Securities and Exchange Commission v. Jarkesy held that the Seventh Amendment of the US Constitution entitles a defendant to a jury trial when the US Securities and Exchange Commission (SEC or Commission) seeks civil penalties for securities fraud, and thus that the SEC may not seek such penalties through its own “in-house” administrative enforcement proceedings, which lack juries. Instead, the SEC may pursue such penalties only in federal court.

The US Supreme Court heard arguments on January 17 in Relentless v. Department of Commerce and Loper Bright Enterprises v. Raimondo. In both cases, a commercial herring fishing company challenged a regulatory requirement that the company cover the costs of an observer required to ride along on the fishing boat to confirm compliance with various regulatory requirements.

The US Supreme Court recently debated the future of the legal precedent known as Chevron deference in two separate cases arising out of the National Marine Fisheries Service’s statutory interpretation of the Magnuson-Stevens Act, a statute it enforces. The decision in these cases will almost certainly have far-reaching impacts on agency actions, including as it is applied in the healthcare and life sciences industries.

Partner Jennifer Breen was quoted in a Bloomberg Tax article discussing how new provisions in the GOP tax bill aim to protect the US Treasury Department from future legal challenges.

Partner Bryan Killian spoke with Bloomberg News about how the firm’s Chevron Task Force and strong roster of lawyers with government backgrounds can assist clients in the wake of the US Supreme Court’s decisions in Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce.

Lexis Practical Guidance published an article written by partner Julie Stapel discussing the impact of the US Supreme Court’s decision in Loper Bright Enterprises v. Raimondo and Relentless, Inc. v. Department of Commerce on two US Department of Labor regulations, the “ESG Rule” and Retirement Security Rule, which are being challenged in federal court.

Partner Jacob Harper spoke with Healthcare Risk Management about how the agencies regulating the healthcare industry could respond to the US Supreme Court’s decision reversing the Chevron doctrine. Jacob said that concern about whether an agency’s determination will be overturned by a court is likely to change the way in which they provide compliance interpretation.

Partner Fred Block spoke with WatersTechnology for an article discussing how the US Securities and Exchange Commission (SEC) might regulate artificial intelligence (AI) following the US Supreme Court’s decision to overturn the Chevron doctrine.

Bloomberg Law quoted partner Julie Stapel in an article about a case challenging the authority of the US Department of Labor (DOL) to promulgate its sustainable 401(k) investing regulation.

Partner Ryan Lighty and associate Scott Clausen co-authored a Law360 Expert Analysis article for the publication’s “After Chevron” series looking at the impact on the Nuclear Regulatory Commission (NRC) of the US Supreme Court’s decision to overturn the Chevron doctrine.

Lexis Practical Guidance published an article written by partners Jennifer Breen and Matthew Schnall and associate James Steele. The article discusses the impact of the US Supreme Court’s decision in Loper Bright Enterprises v. Raimondo and Relentless, Inc. v. Department of Commerce on the US Department of the Treasury and Internal Revenue Service, as well as implications for taxpayers.

ESG Dive quoted partner Erin Martin from comments she made during a virtual event hosted by the publication titled “Risk & Reward: Complying with the SEC’s Climate Rule.”

The Wall Street Journal quoted partner Jennifer Breen in an article about how the US Supreme Court’s decision to overturn the Chevron doctrine will impact the Treasury Department’s process for promulgating rules based on the tax code.

In this Law360 Expert Analysis, Duke McCall, Ella Foley Gannon, and John McGahren discuss the US Supreme Court’s decision in Loper Bright and Relentless, provide background on the Chevron doctrine, and outline what they feel may be the impact of Chevron’s overturning, including rendering recently promulgated environmental regulations more vulnerable to legal challenges.

Reuters quoted partner Julie Stapel in an article about how a case before the Fifth Circuit challenging a rule allowing socially conscious investing will present an early test for how courts may scrutinize federal regulations in the wake of the US Supreme Court overturning the Chevron doctrine.

Practical Guidance published Morgan Lewis’s LawFlash regarding the US Supreme Court decision in Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce, which overruled the Chevron doctrine requiring federal courts to defer to administrative agencies’ interpretations of ambiguous or broad statutes.

Partner Bryan Killian is quoted in a Reuters article discussing law firms’ response to decisions from the US Supreme Court that reign in the power of federal agencies, including one that overturned the longstanding Chevron doctrine, which required courts to defer to agency interpretations of statutes deemed ambiguous.

Partner Justin Weitz spoke with The Wall Street Journal about implications resulting from series of recent rulings from the US Supreme Court, including overturning Chevron deference, related to federal agency power.

Partner Jake Harper spoke with MedPage Today about potential effects on rulemaking from the Centers for Medicare & Medicaid Services following the US Supreme Court’s decision overruling the Chevron doctrine, which gave deference to agency interpretation in instances of ambiguity in a law. Jake noted the Medicare statute is “tremendously ambiguous.”

Partner Michele Buenafe is quoted in BioWorld discussing the potential challenges to US Food and Drug Administration (FDA) actions following the US Supreme Court’s decision to overrule the Chevron doctrine.

Partner Ella Foley Gannon spoke with Bloomberg Law about how the US Supreme Court’s decision overruling the Chevron doctrine could affect environmental regulations.

Partner Stephen Spina spoke with Politico Pro for an article about the potential impact on the Federal Energy Regulatory Commission’s (FERC) Order 1920 of the US Supreme Court’s decision overturning the Chevron doctrine.

Partner Julie Stapel was quoted by PlanSponsor discussing the US Supreme Court’s decision in Loper Bright Enterprises v. Raimondo, Secretary of Commerce that overruled the Chevron doctrine, which required federal courts to be deferential to federal agencies’ interpretations of unclear statutes.

Partner Jennifer Breen was quoted in a Law360 article about how the US Supreme Court’s decision to overturn the Chevron doctrine will affect the ability of the IRS to develop tax regulations.

Partner Stephen Spina was quoted in an article from E&E News by Politico about the potential impact on the energy sector of the US Supreme Court’s decision overturning the Chevron doctrine.

Partners Jennifer Breen and Matthew Schnall were quoted in a Bloomberg Law article that discussed the impact of the US Supreme Court’s decision to overturn the Chevron doctrine on IRS rulemaking authority.

Practical Guidance published Morgan Lewis’s LawFlash regarding the US Supreme Court decision in Loper Bright Enterprises v. Raimondo and Relentless v. Department of Commerce, which overruled the Chevron doctrine requiring federal courts to defer to administrative agencies’ interpretations of ambiguous or broad statutes.

Speaking with Law360 about implications for legal challenges to the Centers for Medicare & Medicaid Services’ reimbursement decisions now that the US Supreme Court has overruled the Chevron doctrine, partner Jake Harper said providers have another “tool in the toolbox” to dispute a legal stance in federal court.

Law360 covered remarks made by partner Jennifer Breen on a panel at the New York University School of Professional Studies’ recent tax controversy forum regarding the US Supreme Court’s decision to strike down Chevron deference and its impact on the US Tax Court.

Partners David Broderdorf and Michael Kenneally and associate Monica Ratajczak authored a column for Law360 discussing how the forthcoming US Supreme Court decisions in two cases—Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce—could potentially impact the Chevron deference.

Partner Julie Stapel and associate Naina Kamath co-wrote a Law360 Expert Analysis column discussing potential implications for Employee Retirement Income Security Act of 1974 (ERISA) regulations if the US Supreme Court ends the Chevron deference. The article discusses two cases before the Court that could affect the future of the Chevron deference and posits that if the Court abandons or curtails the Chevron deference, ERISA regulations adopted by the US Department of Labor may be more heavily scrutinized, modified, or vacated by federal courts.