The Future of Chevron Deference: Of Zombie Fungus and Acoustic Separation, by Jeffrey Pojanowski

by Guest Blogger — Thursday, June 21, 2018

The Supreme Court tossed a proverbial squib into the administrative law world this morning, and the takes, hot and otherwise, are sparking everywhere. It handed down three decisions with implications for administrative law: Lucia v. SEC, Pereira v. Sessions, and Wisconsin Central Ltd. v. United States. Lucia, which already had its own symposium on this blog, gave much for Appointments Clause aficionados to chew on. Pereira and Wisconsin Central—and especially Pereira—restoked discussion about whether the Supreme Court would ever, eventually, at some point jettison Chevron deference.

As you know, Dear Reader, this is not a new discussion, but some fresh data points came in. First, as many have noticed, Justice Kennedy wrote separately to announce his discomfort with Chevron, at least as it is currently practiced. It is important to not read too much into this—Jon Adler makes good points here—but it’s also important to not read in too little, either. Justice Kennedy joined the Chief Justice’s Chevron-skeptical opinion in City of Arlington, but until now that could easily be have been read as favoring a narrow exception for jurisdictional questions. Here, he goes a bit further. He says the Court should revisit deference to agency interpretation of procedural and substantive questions, he cites Chevron-skeptical opinions by Justice Thomas and then-Judge Gorsuch, and he closes with citation to the portion of the Chief’s City Arlington dissent that raises more general concerns about the rise of the administrative state and separation of powers. We don’t know where Justice Kennedy’s reexamination of the doctrine would lead, but this is not the concurrence of one whom is happy with the status quo, and this is the first time he has explicitly noted these worries.

Perhaps even more significant is Justice Alito’s dissent. He does not exactly celebrate Chevron, but he points out the fact that it is governing law and that, faithfully applied, it requires deference to the government’s interpretation. Although Justice Alito joined the Chief’s dissent in City of Arlington and has expressed worries about Auer deference, it is notable here that he is not calling for a reexamination of the doctrine. To the contrary, he seems quite comfortable applying it here and, importantly, applying it with a Step One that does not swallow the doctrine. (More on that below.) Alito’s is a Chevron application that the D.C. Circuit could love.

When you combine today’s decision with Justice Breyer’s proposed softening of Chevron in this year’s SAS Institute decision, it appears that there are at least five votes to narrow Chevron in some form (Roberts, Kennedy, Thomas, Breyer, and Gorsuch), with Kennedy at least in play for a more substantial revision alongside Thomas and Gorsuch. Alito, by contrast, seems cooler toward narrowing Chevron than he did when he joined the Chief’s dissent in City of Arlington. Perhaps we should not read too much into one opinion, but today suggests Alito is not rushing to join Thomas and Gorsuch on a wholesale revision to Chevron, so it looks like it will be harder for Chevron’s critics to count to five for explicit overruling.

But the most interesting portion of Alito’s dissent suggests Chevron critics can lose that battle but win the war. After explaining at length why he thought the majority’s interpretation of the statute was plausible but not compelling, he noted

Choosing between these competing interpretations might have been difficult in the first instance. But under Chevron, that choice was not ours to make…[U]unless the Court has overruled Chevron in a secret decision that has somehow escaped my attention, it remains good law.

Having a super-strong Step One, Alito suggests, is in many cases not all that different from abandoning Chevron deference. As I have argued before, such a strong Step One essentially takes (a) one category of Step Two cases (hard questions of statutory interpretation) and files them under nearly de novo review and (b) takes another category of Step Two cases (questions where it is really hard to apply any of the traditional interpretive tools…think “act in the public interest”) and drops those questions into ordinary arbitrary and capricious review. In a poof, the strong Chevron that treats legitimate interpretive disagreement as a forum of policy choice disappears and informal Skidmore or de novo review takes over under the guise of applying Step One. Or, more simply, does this by noting that Chevron does apply because the statute is clear.

For defenders of Chevron deference, this is equivalent of the zombie fungus that takes over ants’ bodies to control their minds: on questions of law, the doctrinal form of deference remains, but an aggressive, non-deferential spirit controls its remaining husk. For Chevron’s critics, it’s a pretty neat move. It does not require the sturm und drang of overruling an old case, or it at least gives the Court a chance to experiment with less deferential review before whether deciding how to make such a change and make it official.

In the end, though, such an overruling may not be necessary. If the Justices rarely feel like they are ceding their power to say what the law is, the urgency to jettison the doctrine simply goes away. The deference space becomes the exclusive preserve of true agency policy choices and, while some judges and scholars may worry about the non-delegation doctrine, there is no similar groundswell to replace arbitrary-and-capricious review with de novo judicial policymaking.

All of which raises the question of what do you do with the husk of Chevron wandering around the U.S. Reports? This is a pressing question for appellate and district courts, who don’t have the luxury of ignoring decisions or recognizing stealth overrulings. It is possible, as Adrian Vermeule and Chris Walker suggested on Twitter, that we could have a regime of de facto de novo review at the Supreme Court but de jure deferential review that lower courts are instructed to obey and might, in fact, actually obey. And if you think Chevron makes sense because (a) it allows for uniform decisions across the circuits and (b) busy district and appellate courts don’t have time to get deep in the weeds of regulatory interpretation, there’s a logic to having unofficial de novo at the Supreme Court and official rules of deference across the circuits.

This results in an interesting spin on the notion of acoustic separation between conduct rules and decision rules, though the Court is playing the nifty trick of conducting its review in a manner separate from its official decision rules, all the while ostensibly expecting the lower courts to not mimic such conduct. Whether this a good thing or even sustainable is another question, and the more the Court casts explicit doubt on Chevron, the more practical leeway non-deferential lower courts might sense. Furthermore, if one thinks deference in the lower courts is as troublesome as it at the Supreme Court, that would suggest more than a Zombie Fungus takeover of Chevron would be needed. But, in the meantime, it is possible that we are seeing a sharpening of the vertical distinctions between deference regimes, a possibility Aaron-Andrew Bruhl flagged a few years back in an excellent paper.

 

Jeffrey Pojanowski is a Professor of Law at Notre Dame Law School.

Cite As: Author Name, Title, 36 Yale J. on Reg.: Notice & Comment (date), URL.

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