Robin Kundis Craig, Agencies Interpreting Courts Interpreting Statutes: the Deference Conundrum of a Divided Supreme Court

• Jurisdiction: United States,Federal
• Publication year: 2011
• Citation: Vol. 61 No. 1

AGENCIES INTERPRETING COURTS INTERPRETING STATUTES: THE DEFERENCE CONUNDRUM OF A DIVIDED SUPREME COURT

Robin Kundis Craig*

ABSTRACT

Plurality decisions from the U.S. Supreme Court demand interpretation, especially because they tend to occur when the Court faces important but divisive legal issues. Most courts, agencies, and scholars have assumed that federal agencies are in no better position to interpret plurality decisions than the lower federal courts when confronted with a potentially precedential Supreme Court plurality decision—the agency must construe the Justices’ various opinions in search of a controlling rationale. In so doing, however, the agency eschews any claim to Chevron deference because it is no longer implementing a statute pursuant to congressionally delegated authority. Instead, it is merely an agency interpreting a court.

This Article argues that pursuant to the Supreme Court’s 2005 decision in National Cable & Telecommunications Ass’n v. Brand X Internet Services, federal agencies have another option when dealing with a Supreme Court plurality decision regarding either a statute that the agency implements or the agency’s prior interpretation of that statute. In the right circumstances, these post-plurality agencies can invoke their original congressionally delegated authority to implement the statute and issue new regulations that should be entitled to Chevron deference. Post-plurality agencies thus face a deference conundrum: they can defer to a fractured Supreme Court decision at the expense of their own claims to interpretive authority, or they can—admittedly with some risk in the next round of judicial review—reclaim interpretive deference for themselves.

In assessing the deference conundrum, the exact character of the plurality decision is important. This Article includes a typology of Supreme Court plurality decisions involving agency-mediated statutes. When the

* Attorneys’ Title Professor of Law, Florida State University College of Law, Tallahassee, Florida. My thanks to Dave Markell, Jim Rossi, J.B. Ruhl, Mark Seidenfeld, and Uma Outka for their comments on the draft of this Article. Nevertheless, I remain solely responsible for its content.

Chevron/Brand X framework applies, however, agencies have the opportunity, and arguably the duty, to eliminate the confusion and inconsistency that plurality decisions promote by issuing clarifying and nationally uniform rules.

INTRODUCTION 3

1. THE CONVOLUTIONS OF CHEVRON, MEAD, SKIDMORE, AND

   BRAND X 11

   1. Agency Interpretations of Statutes: Basic Chevron Deference 11

   2. Limiting Chevron Deference: Christensen, Mead, and

      Skidmore 13

   3. Agencies, Federal Court Precedent, and the Meaning of Statutes: The Brand X Complication 16

      1. The Brand X Decision 16

      2. Brand X in the Lower Federal Courts 18

      3. The Remaining Issue: Will the U.S. Supreme Court Apply

         Brand X to Itself? 21

2. SUPREME COURT PLURALITY DECISIONS 24

3. A TYPOLOGY OF SUPREME COURT PLURALITY DECISIONS AND BRAND X’S APPLICABILITY TO THE AGENCY’S FOLLOW-UP RESPONSE 28

   1. Decisions on the Constitutionality of the Statute or the

      Agency’s Regulation 29

   2. Decisions Invoking Statutory Interpretation for Purposes Beyond the Direct Regulatory Application of the Statute 34

   3. Decisions Regarding the Validity of Noninterpretive Agency Action 38

   4. Decisions Engaging in Statutory Interpretation in the

      Absence of an Agency Interpretation 41

   5. Decisions Regarding the Validity of the Implementing Agency’s Interpretation of the Statute 48

4. A CASE STUDY OF THE DEFERENCE CONUNDRUM: RESPONSES TO

   RAPANOS V. UNITED STATES 58

   1. Federal Courts’ Reactions to the Rapanos Decision 59

   2. The 2007 Rapanos Guidance 61

   3. The Rapanos Guidance in the Federal Courts 64

   4. Resolving the Conundrum: A Better Response to Rapanos 66

CONCLUSION 67

INTRODUCTION

In 1984, when the Supreme Court decided Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc.,1 it solidified a basic principle of federal administrative law: federal agencies are generally entitled to deference from the federal courts when those agencies interpret statutes that they implement, unless Congress has clearly already resolved the interpretive issue at hand.2 While the Court has since modified the rules regarding the circumstances under which agencies are entitled to Chevron deference,3 creating what many commentators have denominated “a confusing muddle” of deference tests,4 it has never repudiated the core Chevron principle of interpretive deference.

Indeed, the Supreme Court has, on occasion, explicitly subordinated its own interpretive authority to that of agencies.5 More generally, in 2005 it announced in National Cable & Telecommunications Ass’n v. Brand X Internet Services (Brand X) that the rationale of Chevron deference could allow an agency’s interpretation of a statute to supersede a prior and contradictory interpretation by a federal court.6

Despite the Court’s privileging of agency interpretations, judicial review remains an important component of the deference framework,7 just as it is of

1 467 U.S. 837 (1984).

2 Id. at 842–44.

1. See United States v. Mead Corp., 533 U.S. 218, 226–27 (2001) (“We hold that administrative implementation of a particular statutory provision qualifies for Chevron deference when it appears that Congress delegated authority to the agency generally to make rules carrying the force of law, and that the agency interpretation claiming deference was promulgated in the exercise of that authority.”); Christensen v. Harris Cnty., 529 U.S. 576, 586–87 (2000) (declining to accord Chevron deference to opinion letters issued regarding the Fair Labor Standards Act of 1938, Pub. L. No. 75-718, 52 Stat. 1060 (codified as amended at 29

   U.S.C. §§ 201–219 (2006))).

2. Ann Graham, Searching for Chevron in Muddy Watters: The Roberts Court and Judicial Review of Agency Regulations, 60 ADMIN. L. REV. 229, 262 (2008); accord Jack M. Beermann, End the Failed Chevron Experiment Now: How Chevron Has Failed and Why It Can and Should Be Overruled, 42 CONN. L. REV. 779, 809–35 (2010); Lisa Schultz Bressman, Chevron’s Mistake, 58 DUKE L.J. 549, 556, 606 (2009); Evan J. Criddle, Chevron’s Consensus, 88 B.U. L. REV. 1271, 1302, 1314–15 (2008); Claire R. Kelly, The Brand X

   Liberation: Doing Away with Chevron’s Second Step as Well as Other Doctrines of Deference, 44 U.C. DAVIS

   L. REV. 151, 158, 161 (2010); Matthew C. Stephenson & Adrian Vermeule, Chevron Has Only One Step, 95 VA. L. REV. 597, 605–09 (2009); Cass R. Sunstein, Chevron Step Zero, 92 VA. L. REV. 187, 193–94, 202

   (2006).

3. See discussion infra Part I.C.3.

6 545 U.S. 967, 982 (2005).

1. See Thomas O. Sargentich, The Reform of the American Administrative Process: The Contemporary Debate, 1984 WIS. L. REV. 385, 397–402; Peter L. Strauss, Legislative Theory and the Rule of Law: Some Comments on Rubin, 89 COLUM. L. REV. 427, 442–43 (1989).

   administrative law more generally.8 Judicial review of federal agencies’ statutory interpretations serves several purposes: it ensures that agencies do not act ultra vires or improperly expand the scope of their statutory authorities;9 it protects the public’s right of participation in agency decision making;10 it assesses the agency’s interpretations for basic rationality;11 it encourages the

   agency to take more care in resolving interpretive issues;12 and most importantly for this Article, it ensures that both the agency and regulated entities receive clear guidance regarding what the law requires and allows.

   
   

   In the context of federal agencies, such clarity promotes other values as well. For example, there is widespread acceptance, as a normative matter, that federal law should apply uniformly throughout the nation. Frank Easterbrook has noted that delegation to an agency “ensures that a single interpretation prevails” and “permits a nationally uniform rule without the need for the

   Supreme Court to settle the meaning of every law or regulation”13—even if the

   Court could undertake such a monumental task, which it cannot.14 Similarly,

   
   

2. See Lisa Schultz Bressman, Beyond Accountability: Arbitrariness and Legitimacy in the Administrative State, 78 N.Y.U. L. REV. 461 (2003); Richard E. Levy & Sidney A. Shapiro, Government Benefits and the Rule of Law: Toward a Standards-Based Theory of Judicial Review, 58 ADMIN. L. REV. 499 (2006); David S. Rubenstein, “Relative Checks”: Towards Optimal Control of Administrative Power, 51 WM.

   & MARY L. REV. 2169 (2010); Thomas O. Sargentich, The Critique of Active Judicial Review of Administrative Agencies: A Reevaluation, 49 ADMIN. L. REV. 599 (1997).

3. See 5 U.S.C. § 706(2)(B) (2006) (allowing courts to overturn federal agency actions that are

   unconstitutional); id. § 706(2)(C) (allowing courts to overturn federal agency actions that are “in excess of statutory jurisdiction, authority, or limitations, or short of statutory right”); Linda R. Hirshman, Postmodern Jurisprudence and the Problem of Administrative Discretion, 82 NW. U. L. REV. 646, 666–68 (1988); Sargentich, supra note 8, at 605–06.

4. See 5 U.S.C. § 553(c) (requiring federal agencies to provide a public comment period during informal

   rulemaking); id. § 554(c) (requiring that interested parties be allowed to participate in federal agency hearings); id. § 706(2)(D) (allowing courts to overturn federal agency actions that do not follow proper procedures).

5. See id. § 706(2)(A) (creating the federal “arbitrary and capricious” standard of review); id. § 706(2)(E)

   (creating the “substantial evidence” standard of review for formal agency proceedings); Bressman, supra note 8, at 474; Nina A. Mendelson, Disclosing “Political” Oversight of Agency Decision Making, 108 MICH. L. REV. 1127, 1134 (2010); Sargentich, supra note 8, at 605–06.

6. See Mark Seidenfeld, A Syncopated Chevron: Emphasizing Reasoned Decisionmaking in Reviewing

   Agency Interpretations of Statutes, 73 TEX. L. REV. 83, 128–30 (1994); Mark Seidenfeld, Chevron’s Foundation, 86 NOTRE DAME L. REV. 273, 303 (2011).

7. Frank H. Easterbrook, Judicial Discretion in Statutory Interpretation, 57 OKLA. L. REV. 1, 7 (2004);

   accord William Wade...