The Chevron Doctrine is the key element of the modern administrative state in the US. It was created by the US Supreme Court in 1984 in the case of Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984) and since then, it has been a subject of many heated debates among constitutional lawyers (Take Care). Recently, there has been more and more indications that the Court might be changing its mind and considering the Doctrine to be a dead end from which it needs to gallantly retreat. The original decision was unanimous in a sense that all Justices considering the case (Justices Burger, Brennan, White, Blackmun and Powell) joined the Majority Opinion written by Justice Stevens. However the remaining 3 Justices (Justices Marshall, Rehnquist and O’Connor) took no part in the consideration of the case making it an unusual 6-0 decision. The holding of the case is rather simple and dictates that, in cases involving disputes between administrative agencies of the US Government (such as Environmental Protection Agency or Internal Revenue Service) and citizens or corporations, Federal Courts must always defer to an agency’s interpretation of an ambiguous statute which it administers, so long as the interpretation is ‘reasonable’. This simple rule of construction has automatically tipped the scales in favour of administrative agencies over ordinary citizens and corporations.
It comes as no surprise that the composition of the Court has changed completely since 1984 and out of those new 9 Justices, at least 3 have publicly disapproved of the Chevron Doctrine. Justice Thomas wrote in his Concurring Opinion in the case of Michigan v. Environmental Protection Agency, 576 U.S. (2015) that “Chevron deference raises serious separation-of-powers questions”. Similarly, Justice Gorsuch in his Opinion in the case of Gutierrez-Brizuela v. Lynch, No. 14-9585 (10th Cir. 2016) suggested that the Chevron was “a judge-made doctrine for the abdication of judicial duty” while Justice Kavanaugh described the Chevron Doctrine as ‘troubling’ (Harvard Law Review). It is not hard to see that this makes 1/3 of the current Supreme Court openly hostile to the Chevron Doctrine. The question remains whether the other Justices, especially Justice Alito and Chief Justice Roberts, share this hostility. This will only become clear once the Supreme Court come to deal with some case involving the Chevron Doctrine. A case like BNSF Railway Company v. Loos 17-1042.
On 14 May 2018, the US Supreme Court (with Justice Kennedy still on the bench) issued a writ of certiorari to the US Court of Appeals for the Eighth Circuit agreeing to hear an appeal in the case of BNSF Railway Company v. Loos 17-1042. The case raises the question of “whether a payment to a railroad employee for lost wages on account of a personal physical injury is subject to employment taxes under the Railroad Retirement Tax Act,” with the Claimant arguing YES and the Respondent arguing NO (SCOTUSBlog). While the Act itself is silent on this issue, the Internal Revenue Service (which is an administrative agency) in its 1994 regulations stipulates that ‘pay for time lost’ is taxable under the Railroad Retirement Tax Act. According to the Chevron Doctrine, given that the statute itself is silent (i.e. ambiguous), deference should be made to the interpretation put forward by the Internal Revenue Service (unless such an interpretation could be proved to be grossly unreasonable). If the Court was minded to follow the Chevron Doctrine, this would be a very simple case for the Claimant. In fact, under the Doctrine, it is surprising that the Court of Appeals for the Eighth Circuit ruled for the (now) Respondent, Mr Loos. The decision of the Court of Appeals might in itself be an indicator that lowers Courts feel that the US Supreme Court will not defend the Chevron Doctrine on appeal.
Interestingly, it is not only the lower Courts that can sense the hostility of the Supreme Court towards the Chevron Doctrine. Lisa Blatt, who appeared before the Court for the Claimant, mentioned the Chevron Doctrine only briefly at the end of her argument, even though the Doctrine clearly favours her client. Furthermore, Rachel Kovner, an assistant to the Solicitor General, who appeared as a ‘friend of the court’ in support of the Claimant, also almost completely ignored the Chevron Doctrine until the last moment before resting her case (SCOTUSBlog). The hostility of the Court transpires also from the questions that the Justices asked during the oral argument stage of the proceedings. Justices Gorsuch and Kegan seemed to be ready to recognise that the silence of the Railroad Retirement Tax Act on the issue of payments in question was not an ambiguity of the statute within the meaning of the Chevron Doctrine therefore making the Doctrine inapplicable in this case. Justice Kavanaugh was also skeptical when it comes to taking the Internal Revenue Service’s interpretation as a given and questioned the Claimant’s lawyer on the historical changes of the Railroad Retirement Tax Act that would suggest that the payment could not be construed as being subject to a tax (SCOTUSBlog).
The holding in the case of BNSF Railway Company v. Loos 17-1042, whatever it might be, may or may not overrule the Chevron Doctrine. However, the very manner in which this case was argued before the Supreme Court suggests that the Doctrine is not popular these days. It is difficult to predict its future at this point, but is seems that even if the Doctrine is no completely overturned one day, the Court might simply drastically limit its scope either by reading ambiguous states as sufficiently unambiguous, so not to bring the Doctrine into play at all, or it might regularly treat interpretations of ambiguous statutes put forward by administrative agencies as grossly unreasonably, therefore not worthy of any special deference under the Doctrine. In either case, any limitation to the the Chevron Doctrine will have a profound impact on the functioning of the administrative state.
Very interestingly, federal jurisprudence is not the only level at which the struggle against the Chevron Doctrine is unfolding. During the midterm election on 6 November 2018, the people of Florida passed the ballot measure called Amendment 6 which prohibits state Courts from deferring to state administrative agencies (such as Florida Department of Revenue) in cases of ambiguous statutes (Florida Today). The measure was clearly designed to rid state law of anything resembling the Chevron Doctrine. Although the Amendment does not apply outside the state of Florida, and even within the state it applies only to state (not federal) law, it is yet another signal that the Chevron Doctrine might be in trouble.