U.S. Supreme Court Hears Case That Could Determine Future Of Federal Regulations

The U.S. Supreme Court heard oral arguments last week in a case that could alter the trajectory of the federal regulatory state. Specifically, the case could lead to a rollback of a doctrine that is referred to as the “Chevron deference” principle. This precedent requires U.S. courts to generally defer to federal agencies’ interpretations of laws passed by Congress — a standard that makes it more difficult for courts to overturn federal agencies’ actions.

This principle is one of the federal justice system’s most cited precedents and has led to an increasingly volatile and expansive regulatory landscape across administrations. For example, the National Association of Manufacturers (NAM) has found regulatory burdens for manufacturers increased 26 percent from 2012 to 2022 alone.

According to the Energy Equipment and Infrastructure Alliance (EEIA),  if the Chevron doctrine were to be struck down by the U.S. Supreme Court, countless currently proposed or already-in-force regulations on businesses and industry would be vulnerable to legal challenge if it is thought that they are not specifically mandated or clearly intended by whatever congressional act established or empowered the regulatory agency in the first place.

How is the court likely to rule? Reports from the Supreme Court’s hearing last week seem to indicate members of the court’s majority are skeptical about the Chevron doctrine and may reverse it, an outcome strongly supported by EEIA and the Metals Service Center Institute. The Supreme Court is not expected to rule in this case until June 2024.

Stay tuned to Connecting the Dots for more on this story as it develops.