SCOTUS Promotes 'Major Questions' Doctrine for Reviewing Agency Decisions

In what's viewed as a major decision by the Supreme Court Thursday, justices didn’t overrule the Chevron doctrine but appeared to further clamp down on the ability of agencies like the FCC to regulate, absent clear direction from Congress. The opinion came in an environmental case, West Virginia v. EPA. Legal experts said the 6-3 decision likely presages that courts would overturn an FCC decision to classify broadband under Title II of the Communications Act.

The majority, led by Chief Justice John Roberts, stressed the use of the “major questions” test as the standard for review. The three justices appointed by Democrats dissented. SCOTUS upheld a decision by the U.S. Court of Appeals for the D.C. Circuit, which effectively limits the EPA’s options for cutting greenhouse gas emissions from existing power plants.

“Under our precedents, this is a major questions case,” Roberts wrote. “EPA ‘claim[ed] to discover in a long-extant statute an unheralded power’ representing a ‘transformative expansion in [its] regulatory authority,’” he said: “The Agency’s discovery allowed it to adopt a regulatory program that Congress had conspicuously and repeatedly declined to enact itself."

"Capping carbon dioxide emissions at a level that will force a nationwide transition away from the use of coal to generate electricity may be a sensible 'solution to the crisis of the day.' But it is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme," Roberts wrote. "A decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to a clear delegation from that representative body," Roberts said. He didn’t mention Chevron.

In her dissent, Justice Elena Kagan wrote that the court's ruling "strips” EPA “of the power Congress gave it to respond to 'the most pressing environmental challenge of our time.'” She was joined by Justices Stephen Breyer, who stepped down from the court at noon Thursday, and Sonia Sotomayor. “The current Court is textualist only when being so suits it,” she said: “When that method would frustrate broader goals, special canons like the ‘major questions doctrine’ magically appear as get-out-of-text-free cards.”

In a concurring opinion, Justice Neil Gorsuch, joined by Samuel Alito, elaborated on use of the major questions doctrine: “Like many parallel clear-statement rules in our law, this one operates to protect foundational constitutional guarantees.”

“In general, this makes many agency actions based on statutory interpretations, FCC's included, open to challenge under this evolving major questions doctrine,” said Andrew Schwartzman, Benton Institute for Broadband & Society senior counselor. “Chevron lives, but is being ignored by the court, which increasingly seems to be deciding cases based on the text, implicitly finding no ambiguity,” he said: “Since the court is silent on Chevron, I imagine that lower courts will continue to employ it where they see ambiguity. But at the same time, those courts may well be emboldened to decide there is no ambiguity.”

Net Neutrality Implications

The court’s decision shouldn’t affect the commission’s "more technical work, such as on spectrum,” said Matthew Berry, a former FCC general counsel and chief of staff to former FCC Chairman Ajit Pai. “The court’s articulation of the major questions doctrine will make it more difficult for the FCC to impose Title II regulation on broadband and reverse the Restoring Internet Freedom Order,” Berry said.

“Huge decision,” emailed Gus Hurwitz, professor at the University of Nebraska College of Law. “The big picture is that it shifts power from the executive back to the legislative, with a note from the Court reading ‘Dear Congress, do your damn job,’” he said. “Title II-based net neutrality rules are DOA,” he said. The opinion raises questions about how the FTC can use its unfair methods of competition (UMC) authority, he said: “The most useful gloss is probably that if an agency wants to reshape an important industry the authority and tools it uses need to be clearly delineated by Congress. That doesn't bode well for the FTC using its UMC authority to go after big tech or longstanding and widespread business practices.”

SCOTUS, and lower courts, “have been invoking” the major decisions doctrine “with greater frequency in recent years, and I only see that trend continuing,” emailed Daniel Deacon, lecturer at the University of Michigan Law School. “It’s really a way to limit agencies in a similar way that a revived non-delegation doctrine would but without expressly invoking any particular provision of the Constitution.”

The criteria for determining what constitutes a major question have “never been clear, and the opinion today didn’t appear to clarify things,” Deacon said: “My fear is that anything that codes as ‘controversial’ in certain circles or that is politically salient more generally will strike the Court as ‘major.’ That will leave agencies with plenty of small-bore (though still important) responsibilities, but it may disable them from confronting some of the gravest problems facing the country, as we have seen now in the context of COVID-19 and the climate crisis.”

“It's consistent with the court's statements over the years that in extraordinary cases of economic and political significance, the court should hesitate before concluding that Congress intended to grant significant regulatory power to the agency through ambiguous language,” said Daniel Lyons, professor at Boston College of Law. Chevron is “alive and well in run-of-the-mill agency actions,” he said: “I do expect more litigation challenging specific agency action as a major question that Congress must have clearly delegated to the agency” including “FCC authority to regulate broadband network practices.”

More Litigation Predicted

“The practical effect will be to stimulate more litigation, more appeals of administrative agencies’ rulings,” said Cooley’s Robert McDowell: “Agencies will have to be even more careful to explain their rationale regarding why their decisions are faithful to the intent of Congress as expressed in statutes."

The decision means “a higher risk that any FCC or FTC rulemaking will be overturned in court” and “more difficulty for Congress in drafting legislation, particularly regarding tech, as the legislation will have to be more specific and narrower to have its implementation likely to withstand judicial scrutiny,” New Street’s Blair Levin told investors. He forecast “longer periods of time and greater uncertainty as to what the rules are/will be.” Levin sees increased risks the 5th or 6th circuits could restrict “the FCC’s ability to raise funds for universal service, throwing the current universal service framework into chaos.”

Combined with the court’s previous ruling in AHA v. Becerra (see Ref:2206150059]), the decision indicates the current SCOTUS is unlikely to knock down the Chevron doctrine, said Jeffrey Lubbers, an administrative law professor at American University. “This wasn’t a frontal assault on Chevron, the language was fairly moderate,” Lubber said. Since the case would have been suited for taking on Chevron deference and the court avoided doing so, it’s unlikely to do so with its current make-up, he said.

The majority’s goal instead seems to have been fleshing out the major questions doctrine, Lubbers said. SCOTUS went out of its way to rule on the matter, Lubbers noted -- the court could have ruled the case was moot because the clean air policies it concerned are defunct, or rejected the case for a lack of standing. Instead of taking “an exit ramp,” SCOTUS “wanted to decide this case,” Lubbers said.

“The Court’s reliance once again on the major questions doctrine likely will diminish further the effect of the Chevron doctrine,” emailed Free State Foundation President Randolph May. Gorsuch’s concurrence cited an article by May.

“Chevron lives (for when SCOTUS wants to uphold Republican-led agencies who fudge the law). Anything that Democrats want to do is simply a 'major question' to which Chevron doesn’t apply,” Public Knowledge Legal Director John Bergmayer said on Twitter. Classifying telecommunications service is very clearly and historically within the FCC’s purview, said Public Knowledge Senior Vice President Harold Feld. On net neutrality, “I’m not persuaded that anything has changed since yesterday,” Feld said Thursday.

The ruling is “not really impacting routine Chevron cases” but instead says that “where the agency has done something that it regards as momentous … the Court is going to look for a clearer statement that Congress authorized the agency to do that,” said George Washington University law professor Jonathan Siegel: The Court is "clearly moving towards some cataclysmic clash in which they finally decide what they're going to do with Chevron,” but “I don't think today's case really moves that forward,”

The Court "tend[s] to turn to the major questions doctrine" when it doesn't want to address Chevron, said Frank Russo, National District Attorneys Association director-government and legislative affairs, speaking in his own capacity. There may be an expanded use of litigation “case by case” using the major questions doctrine moving forward where "maybe previously the court wasn't going to be willing” to consider it, Russo said, and Thursday’s ruling “opens the door for Congress” to clarify an agency’s authority.