Tag Archives: Chevron Deference

FCC Defends Itself Against Loper Bright

The FCC has gone on the offensive and defended itself against possible lawsuits that might claim that the FCC has overstepped its regulatory authority that was granted by Congress. The FCC’s position was stated in a series of letters sent to Senators. The Senators had made an inquiry to the FCC from the Post-Chevron Working Group that is assessing the impact of the recent Supreme Court ruling.

The Supreme Court ruling came from the Loper Bright case about a dispute where federal rules required that fishing boats carry and pay for a government-appointed inspector onboard. The Supreme Court ruled in favor of the fisherman, saying that the government agency that created the requirement didn’t have explicit direction from Congress to require fisherman to pay for inspectors.

This ruling is being widely interpreted as putting a huge dent in the Chevron deference, which was established by a Supreme Court ruling in 1984 in Chevron U.S.A. v. Natural Resources Defense Council.  The Chevron deference basically said that federal agencies should get to make policy decisions that fit within their overall mandate from Congress.

The FCC response, signed by Chairperson Jessica Rosenworcel says that she believes the FCC has “broad statutory authority granted by the Telecommunications Act of 1934 for “the purpose of regulating all interstate and foreign communications by wire or radio and all interstate and foreign transmission of energy by radio.”

She goes on further to explain that the FCC doesn’t make most decisions unilaterally and goes through a mandated regulatory process of following the “notice and comment” provisions of the Administrative Procedure Act. This process means that the FCC issues a Notice of Proposed Rulemaking and provides an opportunity for public comment on proposals.

Finally, she states that the FCC Commission staff works diligently to ensure that all regulations have a firm grounding in law, and she feels that the FCC’s rules and decisions will withstand judicial review under the Supreme Court’s decision.

Of course, none of this protects Chevron claims from being levied against the FCC, but the agency is taking a strong position that it has the regulatory authority from Congress to defeat any such attempts.

Interestingly, Congress always has the power to resolve any Chevron disputes. If a particularly sticky issue every arises at the FCC, Congress could cement the FCC’s authority to make a decision by passing a law that supports that FCC position. If Chevron is truly dead, then Congress might be reduced to taking these steps to implement policies that it supports. Congress has been quite happy over the years to let the experts at the FCC and many other similar agencies make the hard decisions without Congress having to dip into a host of technical issues.

I’ve already read a lot of speculation that the Supreme Court ruling is not going to mean much to agencies like the FCC. The big companies regulated by the FCC already take the agency to court for practically every major ruling that it makes, and the end of the Chevron deference likely won’t mean more suits. It’s more likely that ISPs and others will tack a Chevron argument onto whatever suits they were going to file anyway.

Ending the Chevron Deference

You might have heard that the Supreme Court recently made a ruling that will have a huge impact on federal regulators like the FCC. The case was Loper Bright Enterprises v. Raimondo and involved a suit by a New England fishing company against the National Marine Fisheries Service (NMFS), a federal agency.

The suit came from a dispute where federal rules required that fishing boats carry a government-appointed inspector onboard to monitor that fishermen aren’t catching fish over limits set to protect against overfishing. The plaintiff, Loper Bright, went to court to argue that it shouldn’t have to pay the cost of the inspector, about $700 a day. A district court agreed with the NMFS, and a federal appeals court affirmed the lower court decision. Loper Bright appealed to the Supreme Court, which accepted the case in May 2023. The Supreme Court recently ruled in favor of the fisherman, saying that the NMFS didn’t have explicit direction from Congress to require fisherman to pay for inspectors.

This ruling is being seen as the end of the Chevron deference, which was established by a Supreme Court ruling in 1984 in Chevron U.S.A. v. Natural Resources Defense Council.  The Chevron deference basically said that federal agencies should get to make policy decisions that fit within their overall mandate from Congress. For the last forty years, this case would have been resolved as the district court and appeals court handled it. The courts have assumed that Congress is not required to micromanage agencies and specific industries rules like the inspector fees. Courts have concluded that the experts at federal agencies know best how to interpret Congress’s intent.

This ruling will have several consequences for agencies like the FCC. The ruling is a huge win for the big ISPs and cable companies that the FCC regulates. If those companies don’t like an FCC decision, they just have to claim that the FCC doesn’t have the specific authority to make the ruling – and the chances are that they will be right. Agencies like the FCC create regulations based on broad guidelines given to them by Congress. Congress does not dictate the minutiae of the dozens of issues the FCC considers every month. For Congress to do so would largely eliminate a reason to even have an FCC.

As ISPs challenge FCC rulings, courts are likely going to put FCC ruling on hold. There will be a huge flood of such suits being filed against all federal agencies, and these new cases are going to pile up in the courts and take years to clear. Even if an agency like the FCC is deemed to have had the authority for a specific ruling, it may take years to go into effect until the courts settle the matter. This new interpretation by the Supreme Court means a lot of FCC rulings are going to be blocked by the courts due to the agency not having the specific authority for a given decision.

One way to clear the mess this would be for Congress to pass more specific laws. In this case, Congress could pass a law allowing the inspectors and fees, and the issue would be settled. An active Congress could clear cases out of the courts by approving the regulations that are being challenged. But that’s not realistic for several reasons.  Congress has been largely ineffective for a number of years as partisan politics have blocked most laws from even being considered. From a more practical perspective, there are dozens of federal agencies that make decisions about a wide range of important issues all of the time, and intervening in all of them would bog Congress to doing little else.

There is a second interesting option. At least for the issues that the FCC regulates, States could aways get into the fray. States have generally been given leeway to regulate anything that is not being done by the FCC – and that could turn into a big list after a few years. Any challenges to States would likely involve State’s rights rather than regulatory agency authority.

It’s not hard to imagine the law departments at the big ISPs getting ready to pounce on any FCC decision they don’t like. It’s hard to think that this ruling won’t eventually result in agencies like the FCC being hamstrung and paralyzed, unable to make decisions.