By John Kruzel
WASHINGTON (Reuters) -The U.S. Supreme Court dealt a major blow to federal regulatory power on Friday by overturning a 1984 precedent that had given deference to government agencies in interpreting the laws they administer, leaving President Joe Biden’s administration a defeat was inflicted.
The justices ruled 6-3 to overturn lower court rulings against fishing companies that challenged a government-run program, partly funded by the industry, that oversaw overfishing of herring off New England. It marked the latest decision in recent years driven by the Supreme Court’s conservative majority to curtail the authority of federal agencies.
The precedent the court overturned stemmed from a ruling involving oil company Chevron, which had called on judges to respect reasonable interpretations of U.S. law by federal agencies that were deemed ambiguous. This doctrine, long opposed by conservatives and business interests, was called “Chevron deference.”
“Chevron is overruled. Courts must exercise their independent judgment in determining whether an agency has acted within its statutory authority,” conservative Chief Justice John Roberts wrote in the ruling.
The court’s conservative justices were in the majority, while the liberal justices dissented.
The declining productivity of Congress – due to the enormous divisions between the parties – has led to Democratic presidents in particular becoming increasingly dependent on rules issued by US agencies to achieve their objectives.
The 1984 precedent, set in a ruling involving oil company Chevron, has called on judges to defer to interpretations of U.S. laws by federal agencies that are seen as ambiguous. This doctrine, which has long been opposed by conservatives and business interests, is called “Chevron deference.”
Democratic President Joe Biden’s administration had defended the disputed National Marine Fisheries Service regulation and the Chevron deference doctrine. The fish conservation program started in 2020 under Republican former President Donald Trump.
Liberal Justice Elena Kagan criticized the ruling, saying it again expands the Supreme Court’s power over other branches of the U.S. government.
“A rule of judicial humility is giving way to a rule of judicial hubris. In recent years, this Court has too often usurped the agency decision-making authority that Congress has granted to agencies,” Kagan wrote.
The fishermen’s bid was backed by several conservative and business interests, including billionaire Charles Koch’s network. The lawsuit is part of what has been called the “war on the administrative state,” an effort to weaken the bureaucracy of the federal agency that interprets laws, sets federal regulations and implements executive actions.
‘THE BACKGROUND’
Kagan wrote: “Who should give substance to a law when Congress’s instructions have been exhausted? Should it be a court? Or should it be the agency that Congress has charged with administering the law? Chevron’s answer is, is that it should generally be the agency, within reason.”
“That rule has formed the backdrop against which Congress, the courts, and the agencies — as well as the regulated and the public — have all operated for decades. It has been applied in thousands of judicial decisions. It has become part of the warp and woof of modern government, supporting all sorts of regulatory efforts — to name a few, keeping our air and water clean, food and medicine safe, and financial markets fair,” Kagan added.
The regulations required certain commercial fishermen to board U.S. government contractors on their vessels and pay for their services at sea while they monitored the catch.
The companies, led by Loper Bright Enterprises of New Jersey and Relentless Inc of Rhode Island, filed a lawsuit against the fisheries service in 2020. According to them, the monitoring program exceeded the powers of the Ministry of Commerce.
The Supreme Court, with its 6-3 conservative majority, has been skeptical of expansive regulatory powers. In recent years, it has issued rulings designed to curb what conservative justices see as overreach by the Environmental Protection Agency and other agencies.
The fish conservation program aimed to monitor 50 percent of the herring fishing trips reported in the regulated area, with program costs split between the federal government and the fishing industry. The cost to commercial fishermen to pay for the monitoring was an estimated $710 per day for 19 days per year, which could reduce a vessel’s revenue by as much as 20 percent, according to government figures.
The Biden administration said the program was authorized under a 1976 federal law called the Magnuson-Stevens Act to protect against overfishing in U.S. coastal waters. The court papers say the program is suspended for the fishing year that begins in April 2023 due to insufficient federal funding.
The U.S. Court of Appeals for the District of Columbia Circuit in Washington and the U.S. Court of Appeals for the First Circuit in Boston both ruled in favor of the government.
The Biden administration said Chevron’s deference, among other things, “gives appropriate weight to the expertise that agencies bring” and promotes national uniformity in the application of federal law.
A lawyer for the commercial fishermen said Chevron’s deference “encourages a dynamic in which Congress does far less than the Framers (of the U.S. Constitution) expected, and the executive branch must do far more by deciding controversial issues through regulatory fiat.”
The Supreme Court has issued other rulings this term on the scope of agency powers, including two decisions on Thursday. It struck down the Securities and Exchange Commission’s internal enforcement of laws protecting investors from securities fraud. It also blocked an Environmental Protection Agency regulation aimed at curbing ozone emissions that could worsen air pollution in neighboring states.
On May 16, the justices upheld the Consumer Financial Protection Bureau’s funding mechanism in a case brought by the payday lending industry.
(Reporting by Andrew Chung; Editing by Will Dunham)
