Supreme Court throws out 40-year-old precedent, a major blow to federal regulators

A small group of New Jersey herring fishermen caught a huge catch at the Supreme Court.

Chief Justice John Roberts, writing for a 6-3 majority on Friday, took a significant step forward in shaking the power of federal regulators, rejecting 40 years of precedent on the agency’s authority and a Commerce Department rule that fishermen say could put them out of business.

The opinion – officially overturning the 1984 decision known as “Chevron” – is making a big splash, making it easier for businesses and other interests to challenge regulations affecting every aspect of American life, from food inspections, workplace safety, tax collections, environmental regulation and not only.

The case concerned a regulation of the National Marine Fisheries Service requiring certain commercial herring fishermen to pay salaries to government observers. Federal law requires these fish to be kept on board vessels.

The law – the Magnuson-Stevens Act – does not specify how observers who collect scientific data on the nation’s fisheries should be funded. The agency argued that the law’s ambiguity supports its interpretation that boat operators must pay in some cases.

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Lower courts upheld the regulation, citing the Supreme Court decision in Chevron v. National Resources Defense Council, which held in part that courts should defer to scientific and health experts within agencies when the law is unclear about how much of their regulations are reasonable.

Roberts said the ruling was a mistake and that judges, not bureaucrats, should interpret what the vague law allows and what it doesn’t.

“Chevron has been repealed,” he wrote. “Courts must exercise independent judgment in deciding whether an agency acted within its statutory authority as required by the (Administrative Procedure Act).”

“Careful attention to executive branch (agency) judgment may guide this investigation. And when a specific statute delegates authority to an agency under constitutional constraints, courts must respect the delegation while ensuring that the agency operates within it,” Roberts continued. “However, courts do not have to, and under the APA cannot, defer to an agency’s interpretation of the law simply because the statute is ambiguous.”

The ruling is the biggest blow to the administrative state in a generation and a long-sought victory for conservative legal groups and business lobbyists who have been pushing the court for years to strike down so-called “Chevron obedience” and rein in the agency’s power.

Justice Elena Kagan said the decision would be a “huge shock to the legal system” because more than 17,000 federal regulatory cases over the past 40 years have relied on the Chevron doctrine — most of them decided in the government’s favor.

As Kagan wrote, rejecting precedent would mean replacing the competence of experts in a given field at all levels of government.

“It gives courts the power to make all kinds of scientific and technical judgments. It gives courts the power to issue all kinds of policy challenges, including how to weigh competing goods and values. It puts courts at the top of the administrative process because it covers every possible topic,” she wrote.

Public interest groups have said tens of thousands of government regulations could be challenged, covering everything from the environment to workplace safety to technology and health care.

“How far-reaching this decision will be remains to be seen,” said Gordon Todd, a Sidley Superior Court lawyer and an expert in federal regulatory law. “The court sought to minimize the retroactive impact of its decision by noting that prior decisions that relied on Chevron’s deference are themselves entitled to ‘statutory stare decisis,’ but it remains to be seen to what extent such decisions remain valid.”

“In the near term, we expect to see a significant increase in regulatory proceedings, including challenges to existing regulations, ongoing rulemaking and existing precedents,” Todd said.

Jerry Masoudi, former general counsel of the Food and Drug Administration, said the ruling represents a dramatic shift in the balance of power between agencies and courts.

“These decisions will not affect the FDA’s individual scientific decisions, such as product approvals,” Masoudi said in a statement, “but the principles underlying those processes could be subject to broader questioning.”

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Environmental groups were particularly concerned about the Supreme Court’s decision, which warned that scientific experts could now be defeated by judges who are poorly versed in the issues they are discussing.

“Americans really rely on our public institutions to make sure that our air and water are clean, that our health is clean, that our children are healthy, that our homes are safe, that our businesses are safe. And what that really means is that the expertise and the science that we can rely on to make those decisions and implement those safeguards is really at risk right now,” Meredith Moore, director of the Ocean Conservancy’s Fish Conservation Program, told ABC News.

“We will see a slew of lawsuits covering everything the government does, from health and safety to the environment to technology issues like artificial intelligence and our cybersecurity,” Moore added.

As for herring fishermen, the practical effect of the ruling means they will be spared a potential fee of up to $700 per day.

“Today’s restoration of separation of powers is a victory for small, family-owned businesses like ours, whether they’re in fishing, farming or retail,” said Bill Bright, a third-generation herring fisherman from Cape May, New Jersey, and a plaintiff in the case.

“Congress has never approved industry-funded monitoring of the herring fishery. And agency efforts to impose such funding harm our ability to make an honest living. There is nothing more important than protecting the livelihoods of our families and crews.”

Supreme Court abandons 40-year-old precedent, a major blow to federal regulators. Originally appeared on abcnews.go.com