When lobbyists and corporate interests want to influence policy going forward, they’ll be putting more resources toward the judiciary than the president.
When the Supreme Court overturned Chevron deference last month, it also upped the ante for corporate interests to land their cases in a favorable court.
Before the landmark ruling, presidential administrations could change government rules and expect courts to side with them. Now, a judge’s decision on a government rule becomes “locked in” as a judicial precedent for future challenges — even if the executive branch tries to change it in the future.
“Chevron was supposed to, deference was supposed to, take some of the edge off of those selections because whatever judge you got, they were supposed to be deferential. But that’s gone now,” administrative law expert Craig Green told NOTUS.
The incentives for corporate interests to invest financially in presidential elections don’t disappear, but they do shift, in part, from the president’s power over agencies to the president’s power over judicial appointments.
“What it’s done is its moved judicial decisions, judicial appointments, much farther up the political leaderboard in terms of focus points, in terms of points of emphasis way higher than has been true,” Green said.
For the last several decades, a new president in the White House has meant a tsunami of new regulations: Rules from the former administration tossed, new replacement rules proposed and a new regulatory regime underway for all kinds of issues from clean air to electronic communications to road safety.
With the fall of Chevron deference, judges may no longer assume that presidential administrations have the right to alter or change a rule that the court previously approved. Once a court agrees that a rule can stand, it may now be incredibly difficult for a new presidential administration to remove or reverse that rule significantly.
A lesser-known deference called “Brand X,” which was based on Chevron (and is likely moot today), gave administrations the right to change or alter rules. The courts were forced to accept that agencies had the right to do so.
Companies have donated to and participated in presidential elections partly because of this reality: With a new president comes a new regulatory regime. Without Brand X, a new president will likely offer less hope for significant regulatory change, experts told NOTUS.
“Going forward, the meaning of a statute will be interpreted by courts, and that interpretation will stand until Congress amends the statute,” said Jeffrey McCoy, a senior attorney for the conservative Pacific Legal Foundation. “Chevron reduces the power of the executive and returns it to Congress, as the Constitution lays out. Presidential administrations will be limited in how they interpret statutes.”
Or, more likely, experts say, in the face of an often gridlocked Congress, that power shifts to the courts themselves.
In the absence of Brand X deference, the pressure has suddenly increased for agencies and for their challengers to win in court. The stakes are higher because a rule that has been endorsed by a court with national jurisdiction will likely stand in perpetuity, regardless of whether a future president would like to change it, according to Thomas Lorenzen, a former Department of Justice environmental attorney now representing utilities in their challenge to Biden’s power plant emissions rule. The regulation will now be locked in.
The environment has become favorable to companies that can successfully challenge or defend regulations in front of a judge who they expect will ally with their own perspective.
“You’ll have people rushing to courts potentially to try and lock in a particular reading of the statute as the best reading,” Lorenzen said.
That risk is the biggest concern for Ella Gannon, an environmental attorney who represents regulated companies for Morgan Lewis in San Francisco. “The potential for having divergent rulings can create havoc,” she said.
Some proponents of overturning Chevron say the period of uncertainty is short-lived because the Supreme Court would likely make a final, uniform decision if judges interpret a regulation differently across the country.
“In the Loper Bright world, the expectation now will be that you get definitive court rulings which are binding precedents, which will lead to greater stability,” Heritage Foundation fellow and former Trump administration appointee Steven Bradbury told NOTUS. “It may for particular questions under different statutes, it may take a little time for it to shake out.”
That was Justice Neil Gorsuch’s argument in favor of overturning Chevron. He wrote extensively about his desire to stop regulatory flipping even if voters elected a change in administration:
“It forces judges to abandon the best reading of the law in favor of views of those presently holding the reins of the Executive Branch. It requires judges to change, and change again, their interpretations of the law as and when the government demands. And that transfer of power has exactly the sort of consequences one might expect,” Gorsuch wrote in his concurrence to the Chevron deference opinion. The majority of Gorsuch’s concurrence excoriated this kind of regulatory maneuvering and the role judges played in it, even likening the U.S. administrative regime to that of Caligula’s.
But critics, who point to the corporate interests ready to pounce on the new window to challenge government regulations, don’t see stability anywhere on the horizon in this new post-Chevron and post-Brand X world.
“The Supreme Court’s always there as a backstop, but they can only backstop so many cases, and it’s not clear that they’re backstopping,” Green said. “They’re the ones leading the charge. They’re the ones who are throwing the sand in the machine.”
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Anna Kramer is a reporter at NOTUS. Claire Heddles is a NOTUS reporter and an Allbritton Journalism Institute fellow.