Two Major SCOTUS Decisions Changing Federal Regulation Landscape

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In the final days of the term that just ended, the Supreme Court of the United States (SCOTUS) issued two major decisions changing the federal regulation landscape – Loper Bright and Corner Post.

First, in Loper Bright Enterprises v. Raimondo, No. 22-1219, 2024 WL 3208360 (U.S. June 28, 2024) the Supreme Court ended Chevron deference. For 40 years, Chevron required courts to defer to an agency’s reasonable interpretation of rules and regulations within its purview. Chevron handed interpretative power to the executive branch, so as a practical matter, interpretations could change from one administration to another. Writing for the majority, Chief Justice John Roberts explained that Chevron is inconsistent with the Administrative Procedure Act and, for that reason, overruled it. Going forward, courts — not agencies — will interpret rules and regulations. Courts may still look to agency interpretations for guidance, but they owe those interpretations no deference.

Second, in Corner Post Inc. v. Bd. of Governors of Fed. Rsrv. Sys., No. 22-1008, 2024 WL 3237691 (U.S. July 1, 2024) the Supreme Court clarified when the statute of limitations runs on an Administrative Procedure Act claim. Section 2401(a) provides a six-year statute of limitations for claims against the United States. And Corner Post called on the Supreme Court to decide whether that period runs from publication of a regulation or from the injury caused by agency action. Writing for the majority, Justice Amy Coney Barrett reasoned that the period runs from the injury because that is when the plaintiff has a “complete and present cause of action.” As a result, long-standing regulations are not immunized by the passage of time, and a party may seek redress if they do so within six years of the injury.

Together, Loper Bright and Corner Post open new avenues in cases involving federal regulations. For one, courts are no longer restricted by agency interpretations, so parties have greater opportunities to advance regulation interpretations that do not align with the interpretation of an administration. Nor is a party bound to accept an injurious administrative action based on a decades-old regulation; rather, they retain the ability to seek relief.

The post-Chevron landscape is quickly developing. The same day the Supreme Court announced Loper Bright, Alaska litigants challenged new oil development restrictions from the Bureau of Land Management. And in the few days since Loper Bright, federal courts in Texas, Kansas, Missouri, and New York have published decisions applying it. The decision is also likely to affect state regulations because several states, including West Virginia, Kentucky, and Ohio, adopted Chevron deference and, although free to continue using Chevron, may abandon it in favor of the Loper Bright approach.

If you have any questions about this alert or the implications of these rulings, please reach out to the authors or a member of Steptoe & Johnson’s Litigation Team.