At this point, it takes chutzpah to write about Chevron.
Everyone is sick to death of Chevron, and four gazillion other people have written about it, creating a huge pile of scholarship and precious little left to say. Most daunting, Peter Strauss has contributed significantly to the existing pile.
If Professor Strauss has half-a-dozen articles on a subject, the sensible thing is to get one’s hands on them, read and learn from them, and keep quiet.
Nonetheless, here is an addition to the pile. It comes at a critical moment for the Chevron doctrine. In 2007, Linda Jellum reported Chevron’s “demise.”
“Demise” is a strong word, as Mark Twain famously noted. Still, reports of Chevron’s death seemed to get significant confirmation at the end of the Supreme Court’s 2014–2015 Term, when the Court decided three important cases that suggested that Chevron’s condition was, if not terminal, at least serious.
First, in King v. Burwell,
a challenge to an Internal Revenue Service (IRS) rule regarding eligibility for tax credits under the Affordable Care Act,
Chief Justice Roberts perfunctorily rejected the claim that Chevron applied, brushing the case aside like a slightly annoying but unthreatening bug. The relevant statutory provision was in the Internal Revenue Code;
the statute granted the IRS authority to write all necessary regulations to implement the provision;
the IRS had, through notice-and-comment rulemaking and in express reliance on that authority, issued a regulation directly addressing the legal question in the case.
Yet in two succinct paragraphs, the Chief Justice concluded that Chevron simply did not apply—the issue was of such “economic and political significance” that it was inconceivable that Congress would simply have left it to the IRS to resolve.
This was a particularly robust application of the “major questions doctrine,” which holds that judicial deference is out of place with regard to hugely significant policy questions—the sort of issues that Congress should, or must, or can be presumed to, decide.
Strikingly, the magnitude of the issue did not simply keep the Court in “step one” of Chevron, it induced the Court to jettison Chevron altogether.
Second, in Michigan v. EPA,
the Court rejected the Environmental Protection Agency’s (EPA) reading of a provision of the Clean Air Act. This time, it accepted that Chevron applied, but rejected the EPA’s view as unreasonable, a rare “step two” agency loss.
There is nothing remotely deferential about the majority opinion. Moreover, Justice Thomas concurred, writing separately (though for himself only) to argue that the Chevron doctrine is unconstitutional because it cedes to the executive the exclusive judicial authority to “say what the law is.”
Third, in Perez v. Mortgage Bankers Ass’n,
Justice Scalia, of all people, revealed some waning of his longstanding and strident enthusiasm for Chevron. In an opinion that was primarily an attack on the distinct doctrine of deference to agency interpretations of their own regulations, Justice Scalia noted that Chevron is “[h]eedless of the original design of the [Administrative Procedure Act]”
and hinted that perhaps it should be “uprooted.”
This from the Justice generally understood as the firmest and most ferocious defender of Chevron.
Some early commenters see these decisions as at least potentially marking a watershed moment, a fundamental shift from a regime of meaningful deference to a reassertion of judicial supremacy.
Time will tell, but in fact it has long been the case that deference under Chevron is a principle often honored in the breach. For all the clamor, attention, and citations,
Chevron has had less of an impact than this attention implies. Several scholars have surveyed the case law and reported that judges, especially those on the Supreme Court, do not defer as much as the doctrine seems to require. Rather, they have narrowed the circumstances in which Chevron, by its own terms, applies and invoke Chevron only intermittently in those circumstances.
Two responses to this shortfall are appropriate. The first, the subject of Part I, is: “What did you expect?” Only in the rarest of self-protective settings will courts create and stand by a super-strong hands-off principle. Chevron has never, in practice, amounted to an abdication of the judicial role, if only because judges are not going voluntarily to disarm. The second response, considered in the remainder of this Article, is: “Good.” That is, Chevron should not be seen as a revolutionary decision. It insists on respect for the delegation of policymaking authority to administrative agencies, but it preserves interpretive authority for courts. The question “What should be done?” is for agencies. The question “What did Congress do?” is for courts (although they should take seriously what agencies have to say on the matter).
This Essay proceeds in three parts. Part I describes Chevron as a self-regulating doctrine, one that, for that reason, has not taken over the world and will never do so. Part II lays out a basic understanding of Chevron and of Skidmore.
The argument here is for a reading of Chevron that is both weaker and stronger than that often proposed. On the one hand, courts retain an essential and meaningful role in determining, to use Professor Strauss’s terms, the boundaries of “Chevron space”;
they have real work to do. On the other hand, in doing that work, the views of the agency can never be ignored; there is no completely agency-free space within which courts interpret statutes that agencies administer. These principles are explicated in part by reviewing the vocabulary of the Chevron doctrine. This Part concludes by placing Chevron in a jurisprudential framework that draws on the distinction between “interpretation” and “construction.” That distinction has been elaborated in other areas but has not infiltrated administrative law. In the Chevron opinion, its progeny, and the commentary, “interpretation” and “construction” are used as synonyms. But they can be seen as distinct undertakings; one concerns determining semantic meaning, the other applying that meaning to concrete situations. That distinction, or something like it, maps onto and helps elucidate the distinction between the proper roles of the courts and agencies, and the activities of step one and step two. Part III applies the framework developed in Part II to the Supreme Court’s decision in City of Arlington,
which held that Chevron applies to agency determinations going to their own jurisdiction. The majority and the dissent in that case were both correct, making City of Arlington that rare creature, a unanimous 6-3 decision.
I. Chevron as Self-Regulation
Chevron U.S.A. Inc. v. Natural Resources Defense Council
is the Supreme Court’s most important decision regarding judicial deference to agency views of statutory meaning. It lays out a seemingly straightforward approach to considering whether to uphold an agency’s view of a statute:
When a court reviews an agency’s construction of the statute which it administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.
In what is always referred to as “step one” (though that term does not appear in the Chevron opinion itself), the reviewing court “employ[s] traditional tools of statutory construction” to determine statutory meaning.
What exactly happens in step two is disputed, though the dominant judicial and academic formulation is that there, the court asks (a) whether the statute clearly precludes the agency’s reading (in which case the inquiry largely, if not completely, overlaps with step one) and (b) whether the agency’s determination is arbitrary and capricious.
If Chevron is revolutionary, it is because step two seems to take courts out of the statutory-interpretation game, compelling them to accept the agency’s view of statutory meaning. Contrary to settled understandings, it charges agencies rather than courts with the authority to “say what the law is.”
Hence Cass Sunstein’s much-quoted description of the decision as “a kind of counter-Marbury for the administrative state.”
Doctrinally, the impact and meaning of Chevron will depend on (a) in what circumstances it is triggered,
and (b) how capacious step one is, i.e., how quickly a court throws up its hands and defers in step two.
Were Chevron to apply any time an agency had taken a view regarding statutory meaning, and were the court to yield to that view in the face of any statutory uncertainty, the decision would be enormously consequential (and problematic). As discussed above, that has not happened. At least part of the reason is that Chevron is an example of self-regulation.
Self-regulatory regimes rely on entities to oversee themselves. The Chevron doctrine is essentially an example of self-regulation. It is a judicially imposed limitation on the scope of judicial authority, a doctrine through which those in the judging business constrain the activities of the members of their own industry.
Some doubters object that the “self” in “self-regulation” is like the “constructive” in “constructive consent,” or the “quasi” in “quasi-contract”—that is, a synonym for “not.” If you are doing it yourself, it is not regulation.
On this account, self-regulation guarantees under-regulation. That may be an overstatement, but indisputably, the essential risk of self-regulation is excessive laxity. After all, it is a regime in which the regulator is not merely “captured” by regulated interests; regulator and regulatee are one and the same.
To some extent, this dubiousness reflects a misunderstanding of the concept; “self-regulation” is not a synonym for “will power.” The principle is not that an individual person or firm will control itself, but rather that an industry will control its members. That will not necessarily work, but it can work in a market setting if the individual firms recognize that their long-term prosperity depends on mutual constraint. As one scholar concluded from a study of self-regulation in the nuclear power and chemical manufacturing industries: “[T]he key to the rise of self-regulation was the industry’s collective perception of itself as a ‘community of fate.’ Each industry’s future prosperity was seen as depending upon its ability to impose collective self-restraint on its members’ profit-seeking activities in the name of public safety.”
If that is the case, then one setting where one would expect self-regulation to fail is where the industry consists of a single monopolist or, relatedly, where there are multiple players but the industry produces a good for which there are no substitutes. The federal judiciary is one such setting; it enjoys a constitutionally established monopoly on adjudication. Therefore, norms of conduct would have to be overwhelmingly powerful for self-regulation to function effectively.
The federal judiciary self-regulates in many settings; indeed, it is the norm. The traditional approach to judicial misconduct, conflicts of interest, and incompetence has been one of self-regulation (at least up to the point where there has been an impeachable offense, at which juncture the U.S. Congress may take over). There are powerful arguments sounding in judicial independence for this approach.
And professional and ethical norms may be so imbued, and reputational capital so precious, that self-regulation may function adequately in this setting. But the risk of underenforcement is real.
Indeed, Congress has recently grown uneasy with the traditional approach.
Judicial deference doctrines are also examples of self-regulation. This is clearly true of Skidmore
which do not purport to rest on congressional command. And, of course, courts defer to actors other than administrative agencies offering legal interpretations. They defer to agencies doing other things (e.g., making enforcement decisions
), they defer to other actors’ legal interpretations (e.g., state courts’ decisions regarding their own law
), and they defer to non-agencies who are not interpreting the law (e.g., the presumption of the constitutionality of federal statutes
the political question doctrine
). Almost none of these hang on a statutory or constitutional peg; they are prudential doctrines of self-restraint.
Chevron is a self-imposed limitation of this sort. To be sure, the Court and commentators often assert that Chevron is not self-imposed but rests on congressional instructions.
This theory solves one huge, oft-noted problem, namely that the Administrative Procedure Act (APA), pursuant to which most cases in which Chevron is in play are brought, instructs courts to “decide all relevant questions of law, interpret constitutional and statutory provisions,” and set aside agency action “in excess of statutory jurisdiction, authority, or limitations, or short of statutory right.”
But it is hard to find anyone who does not consider congressional delegation a fiction.
Most recently, Mark Seidenfeld has articulated the view that it is a doctrine of “self-restraint,” laying out at length the shortcomings of claims that it rests on any actual statutory mandate or congressional intent.
He has a lot of company.
In any event, the theoretical debate is beside the point. Whether self-imposed or derived from an implicit congressional delegation, Chevron’s command to accept any reasonable agency interpretation is in practice a form of self-regulation. The Court made it up and imposed it on itself; it is administrative common law.
So understood, Chevron is heir to the shortcomings and risks that generally bedevil self-regulation: a lack of transparency, the failure to evaluate or monitor performance, and the absence of meaningful penalties.
Judges, like most human beings (especially successful human beings holding prestigious positions, possessed of high self-regard, surrounded by sycophants, and blessed with matchless job security), will only go so far in ceding authority. Of course, this or that individual judge may be too deferential, may overregulate, so to speak.
Teddy Roosevelt famously complained that Oliver Wendell Holmes was such a judge.
But as an overall tendency, judges generally, federal judges in particular, and Supreme Court Justices most of all, simply are not going to be too constrained.
Accordingly, the continued reports of Chevron’s demise are not a surprise. Nor is the fact that empiricists have had difficulty determining whether Chevron has actually had an impact in the real world.
That does not mean it has had no impact, and it seems likely that it has had some. But the fact that it is so difficult to conclusively demonstrate an impact at least establishes that any shift has not been fundamental.
Chevron is an example of what one might call doctrinal self-regulation. It is a doctrine that by its nature will not get out of hand. Self-regulation simply does not lead to overregulation. The risks of self-regulation are one-sided. Like most people, judges will protect their turf. Moreover, even after all these years, strong readings of Chevron remain counterintuitive; judges’ learned intuitions do not generally lead them to defer on questions of law.
The point is not that deference doctrines are meaningless, and this is not a rant about the imperial judiciary or a complaint that the Supreme Court “seems incapable of admitting that some matters—any matters—are none of its business.”
Indeed, in general, administrative law doctrines align poorly with such objections.
The point is only that, as with justiciability doctrines, the nature and structure of the judiciary guard against overdoing deference, and the danger will almost always be that courts go too far in the other direction.
A 1992 article by the present author cautioning against too strong a reading of Chevron was entitled Deference Running Riot.
In the intervening decades, that title has been shown to be fear mongering. Deference has not run riot, and experience and common sense both suggest that it will not. At the same time, Chevron is far from dead. Properly understood and sensibly applied, that decision is a salutary recognition that Congress delegates broad authority to agencies and courts must respect those delegations. But it leaves courts with an essential role in determining the scope of those delegations. The remainder of this Essay accepts that the revolutionary Chevron, that apotheosis of judicial self-abdication, is indeed dead (if it ever was truly alive) and articulates the nature and scope of the robust and appropriate Chevron that should survive.
II. A Viable Chevron (and Skidmore)
What, then, should a viable Chevron—a Chevron that is sustainable, consistently applied, and aligns with separation-of-powers norms and judicial realities—prescribe? This Part lays out an understanding of Chevron that is both consistent with basic principles of separation of powers and an implementable form of judicial self-regulation. It focuses on the distinctions between Chevron and Skidmore, because each is best understood in comparison to the other.
A. Doctrinal Consequences of the Categorical Model
Chevron and Skidmore are both doctrines of judicial “deference.” It is often said that the first requires “strong deference” and the second “weak deference.”
This misconceives the distinction as one of degree when it is in fact a difference in kind. Where Chevron has courts accept any reasonable agency interpretation of an ambiguous statute, Skidmore insists that courts take agency views seriously but cautions that those views are “not controlling upon the courts by reason of their authority,” offer “guidance,” and at most have the “power to persuade.”
Peter Strauss’s helpful route to understanding the distinction between these two sorts of deference begins with terminology. As the title to his influential article puts it, “deference” is “too confusing”; instead, he would refer to “Chevron space” and “Skidmore weight.”
On this conception, Chevron marks off and insists that courts respect a space within which the agency is in charge. The court must define the boundaries of that space;
an interpretation that is “unreasonable” exceeds those boundaries. But within Chevron space, the decisionmaker is the agency and the court’s job is to defer rather than second-guess. Chevron space is the area between what a statute “must mean and what it cannot mean.”
Under Skidmore, in contrast, the court is the ultimate decisionmaker. The agency’s views must be taken seriously; they carry weight. But the court has the ultimate say.
Accordingly, there are two fundamental differences between Chevron and Skidmore: the who and the what. First, the ultimate decisionmaker is different in the two settings. Under Skidmore, at the end of the day the decisionmaker is the court; the agency’s views have the power to persuade but they “lack power to control” and are “not controlling upon the courts by reason of their authority.”
Under Chevron, the decisionmaker is the agency; as long as the agency has not gone off the deep end, the court must accept its decision. Thus, in Alaska Department of Environmental Conservation v. EPA, Justice Ginsburg observed that in Chevron, the Court had “accorded dispositive effect to the EPA’s interpretation of an ambiguous [statutory] provision,” whereas the interpretation challenged here “does not qualify for the dispositive force described in Chevron.”
Instead, it merely “‘warrant[s] respect.’”
The Court agreed with the agency, but it did not defer in the strong sense.
In other cases, the Court has cited Skidmore but ultimately rejected the agency interpretation—not because it was unreasonable, but because it was wrong.
Whether agreeing or disagreeing with the agency, the Court was making the decision.
To say that in Skidmore the court is the ultimate decisionmaker whereas in Chevron step two the agency is the ultimate decisionmaker is true but incomplete. Equally important, the court and the agency are making different sorts of decisions. The agency is making a policy decision. By definition, within its Chevron space, the agency is unconstrained by the statute, which has given out. It must act reasonably, i.e., not arbitrarily and capriciously, and it cannot exceed statutory boundaries. However, within those limits (which may be expansive), the agency can do what it wants. In contrast, in a Skidmore case, the court is the decisionmaker, but it cannot do whatever it wants. Its role is to do what Congress wants (or, alternatively, what the statute dictates). That description of the judicial role may sound naïve or old-fashioned.
Interpreters, including judges, are never wholly constrained, must make judgment calls, and will (properly) be influenced by policy concerns. But the constitutional structure, the APA’s distinction between legislative and interpretative rules, centuries of jurisprudence, and most people’s intuitions accept a distinction between interpreting law and making law. The court’s job is to give the statute the best possible reading, not to adopt the best possible policy.
Under Skidmore, the weight due an agency’s interpretation varies according to the circumstances.
The “Skidmore factors” that determine where the interpretation falls along this sliding scale help illuminate the difference between the judicial task under that decision and the judicial task under Chevron. For example, the most familiar and well-settled factor is that under Skidmore, a long-standing, consistent interpretation merits special weight.
Three justifications might support this principle. First, if the agency has flipped, then at least one of its positions must be wrong, and there is a meaningful chance (though in principle less than fifty–fifty) that the one under review is the wrong one. Therefore, judicial confidence in the agency is significantly undercut. Second, if the agency has not flipped, and Congress has left the statute alone, there is implicit congressional approval of the agency view.
Many things explain congressional inaction besides agreement (e.g., ignorance, distraction, inability to agree on an alternative, lack of time), so the acquiescence argument is thin, but courts still trot it out and it is not absurd. Finally, reliance interests always counsel, to some degree or another, sticking with the status quo; upsetting a long-standing interpretation could be disruptive and costly.
The relevance of the first two considerations, though not the third, hinges on the rationale for deferring. Both go to the likelihood that the agency interpretation is “right” in the sense of being an accurate understanding of what the statute means. Thus, the implicit premise is that the statute has a meaning (and a “correct” meaning); the answer lies in the statute; and there is reason to have some (though a varying) degree of confidence in the agency’s understanding of it. Longstanding interpretations get special weight because they are more likely to be correct. In contrast, if the court is deferring because Congress has delegated policymaking authority to the agency, then by definition the statute does not have a correct reading. A flip-flop does not undercut the agency decision at all; indeed it may reflect the delegation, expertise, and accountability that are thought to justify deference in the first place. Appropriately, then, the Court has held that this most familiar and central feature of non-Chevron deference—reduced deference to inconsistent agency positions—is inapplicable under Chevron.
This leads to a final point. Within its Chevron space, is the agency really “interpreting”? It is very common to speak of Chevron as involving situations where the agency has been granted “interpretive authority.”
Yet to the extent the agency is making a normative, policy-based, prescriptive decision, it is not “interpreting” a statute. It is not explaining what Congress has decided; it is deciding in Congress’s place. Judge Posner’s well-known opinion in Hoctor v. United States Department of Agriculture makes the point.
An agency memorandum provided that only fences eight feet and higher would satisfy a regulatory requirement that certain wild animals be adequately contained.
The agency argued that the memorandum did not have to go through notice-and-comment since it was an interpretive rule, simply explicating what the regulation already required.
The court disagreed, stating that the shift from the general standard requiring effective containment to the specific rule requiring an eight-foot fence cannot “be derived from the regulation by a process reasonably described as interpretation.”
The same can be said of any step-two case: By definition, interpretation has failed to produce an answer. The statute is silent, so the court goes with the agency. It is a category mistake to view Chevron as being about deference to agency interpretations.
It is more than a little odd that courts and commentators continue to insist that Chevron is about “interpretive authority” because, when courts operate in step two (which is what counts, after all), they do not treat the agency decision under review like an interpretation. They treat it like a policy judgment and review it pursuant to the arbitrary-and-capricious test.
Consider Judulang v. Holder.
This was a complicated case in which a unanimous Court set aside a policy of the Board of Immigration Appeals concerning the circumstances in which the government would waive deportation of a deportable alien. The government urged the Court to defer under Chevron, but instead the Court reviewed the policy under the arbitrary-and-capricious test:
The Government urges us instead to analyze this case under the second step of the test we announced in [Chevron] to govern judicial review of an agency’s statutory interpretations. Were we to do so, our analysis would be the same, because under Chevron step two, we ask whether an agency interpretation is “‘arbitrary or capricious in substance.’” But we think the more apt analytic framework in this case is standard “arbitrary [or] capricious” review under the APA. The BIA’s . . . policy . . . is not an interpretation of any statutory language . . . .
So, if the argument is not really about statutory meaning, it is not a Chevron case, but rather an arbitrary-and-capricious case. An example is Fox Television, in which the FCC had found that when Fox aired a fleeting expletive, it had broadcast “indecent” material in violation of the relevant statute.
There was no dispute that fleeting expletives were indecent within the meaning of the statute, but the agency had heretofore not bothered to enforce the prohibition in the case of fleeting expletives.
It then changed its policy, and Fox challenged the new policy.
That argument sounded in arbitrariness; it was not a Chevron case about the meaning of the term “indecent.” Similarly, State Farm
did not turn on whether the revoked passive-restraint standard met the statutory requirements that it be “practicable,” satisfy “the need for motor vehicle safety,” and be “stated in objective terms.”
Instead, the Court focused on the adequacy of the reasoning supporting the agency’s judgment calls.
So far so good. But note that Justice Kagan explicitly says that were Judulang to be resolved under Chevron, “our analysis would be the same.”
So Chevron is the arbitrary and capricious test.
Except, she says, that test does not apply to statutory interpretation!
The only way to resolve all this is to view step one as being about statutory interpretation—i.e., figuring out what constraints are actually imposed by the statute—and step two as being about the review of policymaking—i.e., determining whether the agency, free of statutory constraint, engaged in reasoned decisionmaking.
All of this sits comfortably with traditional understandings of the separation of powers. In a Skidmore case, and in Chevron step one, the court and the agency are engaged in the same task, and it is one in which the court has primacy. In Chevron step two, the agency is no longer on the court’s turf, the court is on the agency’s. In the absence of an agency conclusion, the court will do the best it can (just as, in the absence of a directly applicable judicial precedent, an agency will do the best it can in determining statutory meaning). But if the agency has acted, it prevails.
This account is at least part of the response to Justice Thomas’s objection that Chevron is unconstitutional. In Michigan v. EPA, Justice Thomas concurred to challenge the constitutionality of Chevron.
In his view, it violates either Article I or Article III, which vest the legislative and judicial powers in the courts and Congress, respectively.
Viewed as an allocation of “interpretive authority,” Chevron deference “precludes judges from exercising” the constitutionally required “‘independent judgment in interpreting and expounding the laws.’”
For constitutional purposes, and in reality, that just is not happening. Courts retain primacy in interpretation; the agency’s views matter but are not dispositive and thus the judicial power has not been ceded to another branch. Where courts must defer is when the agency is making a policy decision within the scope of its delegation, within its Chevron space. That is not a judicial task. (Justice Thomas, of course, would say such deference is still unconstitutional, this time because it accepts legislation by the executive branch in violation of Article II.
That is a question for another Essay.)
B. Skidmore Within Chevron
Accepting the foregoing, Skidmore turns out to have a role to play within Chevron. These are generally perceived as wholly distinct and alternative regimes. Never the twain shall meet. Yet they do meet. To be precise, they meet in Chevron step one. In determining whether the statute answers the question before it in step one, a court should consider the views of the agency charged with its implementation.
Professor Strauss has said as much,
and he is not quite alone.
But these have been lonely voices. Apparently no court, ever, has expressly stated that Skidmore applies within step one; some have expressly rejected any sort of deference within step one.
Overwhelmingly, step one is seen as, to reframe Strauss’s terminology, “judicial space.” The court is on its own.
This is a mistake. What a court is doing in step one is the same thing it is doing in a Skidmore case (or a statutory case where there is no relevant agency interpretation): trying to figure out statutory meaning. If agency views are relevant outside of Chevron, then they are relevant in step one. In examining the statute to see if Congress spoke to the matter in question, a court is performing the traditional judicial task of statutory interpretation, trying to find a legislative answer. A Chevron step-one case, then, is essentially the same as a Skidmore case. They are both settings in which the court itself is determining the meaning of the statute and there is a relevant agency interpretation in the background. Because the enterprise is the same, the tools should be the same.
The Chevron opinion supports this approach in two ways. First, it approaches step one like any other statutory case, examining the standard inputs before abandoning the effort and moving to step two. Second, Justice Stevens directs courts to apply the “traditional tools of statutory construction” in step one.
Consideration of agency views is emphatically such a tool. To be sure, Justice Stevens did not give weight to the EPA’s views when searching high and low for clues as to the meaning of “source” under the Clean Air Act.
That might suggest he deemed the agency views irrelevant in step one. Alternatively, however, he did not invoke the agency for two other reasons. First, he ultimately accepted the EPA’s views outright;
whether he did so in step one or step two may not have seemed consequential. Second, it is important to remember that step one did not at that point exist as the rigid, distinct step that it has become.
This view may seem counterintuitive. But it is not so different from what the courts already do. Consider the use of substantive canons. After a certain amount of confusion, it is now generally settled that the canons are applicable in step one.
That is, in trying to determine whether a statute is sufficiently clear to avoid step two, a court will consider, along with text and, depending on the judge, purpose and history, substantive canons. A statutory provision may be ambiguous unless and until such a canon is applied; the canon can resolve the ambiguity and keep the court in step one. For example, it may be unclear whether a particular provision applies retroactively. Judicial uncertainty disappears, however, in light of the canon that statutes should be construed to apply retroactively only if they explicitly so provide. Read in light of the canon, the statute is not ambiguous.
Agency views can be given weight in step one in just the same way.
C. It’s Not Just “Deference” That Is Too Confusing—A Chevron Lexicon
The terminological problems in the Chevron case law go beyond the difficulty of the term “deference” that Professor Strauss highlights. This section examines additional terms that are also “too confusing.” It begins with three terms—deference, persuasion, construction—that are problematic because they have two different meanings and courts fail to distinguish between them. It then turns to two two-word pairs—interpretation/construction and ambiguity/vagueness—that present the opposite problem: They mean different things but are employed as synonyms. The goal is partly to get the terminology right and partly to use the terminological discussion to clarify the underlying concepts.
1. Deference. — Professor Strauss would replace “deference” with “Chevron space” and “Skidmore weight.”
The proposition is that “the d-word” is being used to label two different activities. His point is about judicial usage, but it is worth adding that the roots of the difficulty can be found in the two different dictionary definitions of “deference.” The first is “[s]ubmission or courteous yielding to the opinion, wishes, or judgment of another.”
The second is “[c]ourteous respect.”
The first definition implies subordination; the person deferring “submits” or “yields” to another, evidently superior decisionmaker. The second definition implies authority; the person deferring is the ultimate decisionmaker but must give weight to, take seriously, or respect the views meriting deference.
These two definitions easily map onto the deference case law. The first is Chevron step two; the second is Skidmore.
Thus, if a court “defers” under Chevron, it by definition accepts the agency’s view; under Skidmore, in contrast, a court can give an agency interpretation “deference” while still rejecting it.
Justice Scalia has made half this point. He thinks “defer” has only one meaning, the Chevron meaning. Dissenting in a case where the majority invoked Skidmore and noting that the agency’s views “add force to our conclusion” about the meaning of the statute,
In my view this doctrine (if it can be called that) is incoherent, both linguistically and practically. To defer is to subordinate one’s own judgment to another’s. If one has been persuaded by another, so that one’s judgment accords with the other’s, there is no room for deferral—only for agreement.
He is right, if Chevron is the only deference regime. But if, as a majority of Supreme Court Justices have held, there are two deference regimes, then they involve the two different meanings of “defer” that are found in most dictionaries (though not Justice Scalia’s).
2. Persuasive. — A similar problem arises with regard to “persuasive.” It is also “too confusing” because it has two distinct meanings. “Persuasive” may mean “tending to persuade,”
and it may mean “convincing.”
That is why a “persuasive advocate” can leave one “unpersuaded.”
Opinions in Skidmore cases are awash with careless use of this term. With dismaying frequency, courts assert that the persuasiveness of the agency’s reasoning is one of the factors affecting the weight to be given the agency’s views under Skidmore.
This proposition is either a truism or incoherent. Undeniably, a powerfully reasoned agency conclusion is more likely to be upheld than a poorly reasoned one. Courts reward “reasoned decisionmaking.” However, to accept an interpretation because it is “persuasive” is not to defer (in either of its senses), but rather to agree.
The various Skidmore factors (consistency, contemporaneousness, age) all add to the weight of the agency interpretation, making it more “persuasive”; the interpretation’s “persuasiveness” is not itself a Skidmore factor.
The Supreme Court has done much to sow this confusion. For example, Mead identifies “the persuasiveness of the agency’s position” as one of the Skidmore factors.
But this is not what Skidmore actually says. On Justice Jackson’s formulation, the Skidmore factors are the things that give the agency’s interpretation “the power to persuade”; to say that the “persuasiveness” of the agency’s position is one of the things that give it “the power to persuade” is tautological.
Similarly, in a problematic but much-quoted formulation, the Christensen majority opinion stated that agency interpretations are “‘entitled to respect’ . . . , but only to the extent that those interpretations have the ‘power to persuade.’”
This is self-contradictory. Everything, including the arguments of the lawyers in the case, is entitled to respect “to the extent [it has] the power to persuade.”
Under this approach, if the court agrees with the agency it will label the interpretation persuasive and “defer” to it, whereas if it disagrees, it will label the interpretation “unpersuasive” and ignore it.
For example, consider this sentence from a court of appeal’s opinion: “[T]he Director is not entitled to Skidmore respect . . . because his position . . . is simply unpersuasive, notwithstanding its inclusion in the agency’s manual and the Director’s consistent application of [this interpretation] for some time.”
This is not deference; the court is reaching an independent conclusion. On this approach, Skidmore means nothing more than “we will defer to the agency if we believe the agency is right.”
If that’s what it means, it means nothing at all, and Skidmore deference is a fiction.
There are two points here. First, thinking about “persuasiveness” helps clarify the difference between Chevron and Skidmore. The concept is simply irrelevant in step two of Chevron. There, the issue is not whether the agency is right or whether the court agrees with (is persuaded by) the agency’s views. Unless unreasonable (a very different standard), the agency’s views control. It is because the court’s views ultimately control in Skidmore that the question of persuasiveness arises. Second, the relevant meaning of “persuasive” is not “convincing,” but rather “tending to persuade.” Otherwise, the concept is meaningless.
If the Straussian lexicon is adopted, “persuasive” can be abandoned. In the Chevron setting, the term is inapplicable. In the Skidmore setting, where “persuasive” should mean “tending to persuade,” the term “weight” does all the work necessary.
3. Construction. — “Construction,” too, has two meanings that are often confounded. This is because the word is the noun form of two separate verbs with the same etymological root: construe and construct. The first implies interpretation, determining the meaning of the text being construed; the second implies creation, building on the text to construct something new. Which verb is at work in the term “statutory construction”? The answer is both, depending on the context. In Skidmore, the agency, and then the court, are construing the statute, working “to understand or explain the sense or intention of” it.
In contrast, under Chevron, the agency has constructed something—not the statute, which by definition was “built” by Congress, but a determination of legal rights or obligations in the space Congress left for the agency to work within—that the court must accept. Courts construe; agencies construct.
To simply abandon the term “construction” would be a mistake, and would not be possible in any event. The following section suggests, however, that clarity would be advanced if “construction” in this setting were limited to being the noun for “construct,” and “interpretation” the noun for “construe.”
4. Construction Versus Interpretation. — Almost without exception, writing about statutory interpretation uses “interpretation” and “construction” as synonyms.
Indeed, Reed Dickerson defines “construction” with a single word: “interpretation.”
In Chevron itself, Justice Stevens uses the two terms interchangeably.
Later courts have done the same, alternating between the two mainly, it would seem, to avoid repeating the same word too many times in one sentence.
Commentators also alternate between the two at random.
This was not always so, and it is not so today in some legal fields. This section explores the possible distinction between interpretation and construction as a way of understanding Chevron.
Section II.A concluded that what judges do in Skidmore or step one is interpretation in a standard sense—trying to figure out what the statute means (or, on traditional accounts, what Congress meant or intended).
In a Skidmore case, where the court has the last word, the underlying premise is Dworkinian: There is a right answer. For Ronald Dworkin, the question “what is the law on this issue?” always has a discoverable right answer, and the judge’s job is to discover it. Even in hard cases, law does not run out and judges are not forced to legislate.
Now, Dworkin is not asserting that the one right answer is one that Congress put there. To ensure “integrity in legislation,”
courts must interpret a statute, just as they must interpret the Constitution or common law precedents, in light of the underlying principles of the community. In hard cases, the right interpretation is the one that aligns with underlying values and makes the statute the best statute it can be.
That is a tall order, which is why only a judge such as Hercules can be counted upon to get it right. Because herculean judges are few and far between, courts should take help where they can find it. One such source of assistance is the agency charged with administration of the statute.
In contrast, Chevron is positivist. Its very premise is that law sometimes runs out. Under Chevron, the question, “What is the law on this issue?” does not always have a right answer (at least if it is understood to mean “what does the statute prescribe?”). Professor Dworkin asserts that because positivists believe the law “runs out,” they must endorse some version of strong discretion whereby judicial decision is unconstrained by legal principles.
Chevron is not inconsistent with the basis of that critique, it just offers a different resolution. Instead of accepting unconstrained judicial discretion, it requires judicial acceptance of (largely) unconstrained administrative discretion. In other words, Professor Dworkin does not believe that law ever runs out (so there is no reason not to leave decisionmaking to judges), but Chevron does (which is why, in the absence of law, decisions should be made by agencies).
This is a coherent and even appealing view of the Skidmore/Chevron divide. The question is whether it has any basis in reality. Professor Dworkin came late to the question of statutory interpretation and paid almost no attention to administrative agencies.
And the belief that texts have a single, determinate, correct meaning is not a popular one. If all interpretation involves discretion, and any text might have multiple meanings, then the clear distinction between what is happening in Skidmore and what is happening in Chevron starts to collapse.
One possible route out of that difficulty is the distinction that is drawn in some areas of the law between interpretation and construction.
Almost two centuries ago, Francis Lieber, later to author the first and still influential codification of the laws of warfare and to become one of the first professors at the Columbia Law School, wrote a book with the strikingly modern title of Legal and Political Hermeneutics.
This volume, which is not quite as cutting edge as the title makes it sound to modern readers, set out a theory of textual interpretation. Central to Lieber’s hermeneutics was a distinction between interpretation and construction. Interpretation was the narrower task, consisting of “the discovery and representation of the true meaning of any signs used to convey ideas.”
Every text requires interpretation, for “[t]here is no direct communion between the minds of men.”
In some cases, the interpreter can discover the true meaning based on little besides a careful reading of the text. In others, resort must be had to other materials, but the goal is always to ascertain the speaker’s meaning.
Where interpretation does not “suffice . . . we must have recourse to construction.”
“Construction is the drawing of conclusions respecting subjects, that lie beyond the direct expression of the text, from elements known from and given in the text—conclusions which are in the spirit, though not within the letter of the text.”
Most often, construction is necessary where unanticipated circumstances have arisen or background circumstances have changed so much as to make interpretation impossible.
Lieber’s distinction maps tidily onto Chevron, particularly if step one is not especially capacious. Lieber’s definition of interpretation corresponds to Chevron’s step one: “First, always, is the question of whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter . . . .”
In determining whether Congress has spoken to the issue, the court should employ the “traditional tools of statutory construction.”
In Chevron itself, the Court used the “traditional tools” of examining language, purpose, and legislative history before it gave up and deferred to the agency. The premise here is pure Lieber: Congress had an intent, the statute has one true meaning, and through interpretation (which is not the same as a literal reading and may require more than simply reading the statute and seeing what it says) the court comes to understand Congress’s meaning.
A court moves to Chevron’s step two, upholding any reasonable or permissible agency reading, if “the statute is silent or ambiguous with respect to the specific issue.”
In these circumstances, Congress has not resolved the issue and the court will simply accept any reasonable agency determination. In other words, the court does not try to wring some meaning out of the statute beyond what Congress put there. Or, as Lieber puts it: “Interpretation, seeking but for the true sense, forsakes us when the text is no longer directly applicable; because the utterer, not foreseeing this case, did not mean it, therefore it has no true sense in this particular case.”
In these circumstances, the Chevron analysis moves to step two and Lieber moves to construction. For both, the agency is still limited by whatever constraints the statute, the Constitution, and general requirements of reasonableness impose.
Lieber’s distinction has never really taken hold in the realm of statutory interpretation. However, in recent years, several theorists have emphasized the distinction between interpretation and construction as a way of understanding what is going on when courts attempt to understand and apply the Constitution. Keith Whittington and Lawrence Solum are leading examples.
They articulate a distinction between understanding the semantic content of the constitutional text (interpretation) and applying that meaning in actual, often unanticipated, circumstances (construction). The latter necessarily goes beyond the meaning of the document; though guided by it, construction involves some input from, or additions by, the constructer. As Whittington puts it: “The process of constitutional construction is concerned with fleshing out constitutional principles, practices[,] and rules that are not visible on the face of the constitutional text and that are not readily implicit in the terms of the constitution.”
The two steps of interpretation and then construction—determining semantic meaning and then applying that meaning to particular circumstances—occur in statutory cases as well, even if the vocabulary is unfamiliar.
In the constitutional sphere, Professor Solum has referred to issues involving construction as opposed to interpretation as arising in “the construction zone.”
The term of course resonates with the idea of “Chevron space.”
The parallel would be that interpretation takes place in step one of Chevron and in Skidmore cases, whereas construction, within statutorily defined boundaries, takes place in step two.
Gillian Metzger utilizes the interpretation/construction distinction in writing about administrative constitutionalism, i.e., the various ways in which administrative agencies interpret, implement, and help define the meaning of the U.S. Constitution.
She argues that administrative constitutionalism “stands as a prime example of constitutional construction.”
Such construction takes place subject to judicial oversight; courts have ultimate but not exclusive (if that is not an oxymoron) authority to determine constitutional meaning.
Precisely the same phenomenon exists with regard to “administrative statutism.” Properly read, Chevron is an admonition to respect agency statutory construction—which is different from statutory interpretation.
An illustration is the classic Supreme Court decision of NLRB v. Hearst Publications, Inc.
The National Labor Relations Board (NLRB) had concluded that newspaper sellers were “employees” of the papers they sold within the meaning of the labor laws.
The Court of Appeals rejected this conclusion, relying on the common law of California.
The Supreme Court reversed, upholding the Board’s initial decision. It did so in two steps. First, it concluded that the question did not turn on common law standards, which vary from state to state: “Both the terms and the purposes of the statute, as well as the legislative history, show that Congress had in mind no such patchwork plan for securing freedom of employees’ organization and of collective bargaining.”
In this portion of the opinion, the Court made only a passing reference to the Board and did not even mention its views on the legal issue. It then turned to the question of whether, as a matter of federal law, the newsboys were employees. With regard to this issue, the agency loomed large. The Court spent some time on the general purposes of the Act, noted that there will be lots of borderline situations, and stated that the definitional “task has been assigned primarily to the agency created by Congress to administer the Act.”
Accordingly, “the Board’s determination that specified persons are ‘employees’ under this Act is to be accepted if it has ‘warrant in the record’ and a reasonable basis in law,”
which it did.
The two parts of the Court’s opinion might be categorized in many ways. The standard administrative law formulation would be to call the first a “pure question of law” and the second a “mixed question of law and fact.”
Those categories correspond to interpretation and construction. When there are no facts, the inquiry is abstract and the answer need not be applied to particular circumstances; it is “pure.” Lawmaking is “pure” in this way as well. But statutory meaning (like the meaning of a common law precedent) is fully developed through application to particular cases. That is construction, and Hearst and Chevron alike teach that agencies have a particular role to play in that activity.
5. Ambiguity Versus Vagueness. — The interpretation-versus-construction distinction rests on one other distinction: that between ambiguity and vagueness.
A term is ambiguous when it can have two or more meanings; each alone is clear and understandable, but the reader is uncertain as to which is in play. A term is vague when its scope is unclear and there are marginal cases to which it may or may not apply. Professor Solum explains:
A word, phrase, sentence, or clause is ambiguous if it has more than one sense: for example, the word “cool” is ambiguous because it can mean (a) hip, (b) of low temperature, or (c) of even temperament. A word or phrase is vague when it has borderline cases: for example, the word “tall” is vague, because there is no bright line between those individuals who are tall and those who are not. The same word can be both ambiguous and vague in one of its senses: cool is ambiguous and each sense of cool is vague.
The distinction maps on to the interpretation/construction distinction. In general, interpretation is the process for resolving ambiguity; construction is the process for resolving vagueness.
If this distinction is indeed applicable to Chevron as suggested above, then step one should involve resolving ambiguity and step two should involve resolving vagueness. And this is indeed (almost always) the case. This is emphatically not what courts say. The Chevron opinion and most subsequent case law and commentators state that under Chevron, deference is triggered by statutory “ambiguity.”
Sometimes, courts use the term “vague” alongside “ambiguous”; it is not clear that they mean to distinguish the two.
But they are not synonymous, and Chevron is not primarily about ambiguity, it is about vagueness.
When a statute is ambiguous—that is, we are unsure as to which of two (or more) meanings apply—Congress generally has made a decision and the challenge is figuring out what that decision was. This is not to say that Chevron is never applicable in cases of ambiguous statutory language; sometimes, when a term can have either of two meanings, there really is no way of saying which is “right.” But, in general, the challenges of ambiguity are ones of semantic meaning and are resolved by courts. The classic Chevron case involves statutory vagueness. A provision is of inherently uncertain scope and no amount of staring at the text or rummaging in legislative history can make the penumbra less penumbral. Are wetlands “waters of the United States”?
Is an entire facility a “source”?
Are newsboys “employees”?
In sum, a different activity is involved in resolving questions of ambiguity and questions of vagueness. This difference is the difference between interpretation and construction.
III. A Case Study: Chevron and Jurisdictional Questions
A much-debated issue of “Chevronology”
is whether Chevron applies to an agency’s statutory interpretation bearing on its “jurisdiction,” or the scope of its power. Until recently, this was a matter of dispute.
Many shared an intuition against deference on such issues, fearing that Chevron would enable agency empire-building. In City of Arlington v. FCC,
the Court held that Chevron does apply to jurisdictional questions. For Justice Scalia, this was a case about whether Chevron lived or died:
Make no mistake—the ultimate target [of those arguing for an exception] is Chevron itself. Savvy challengers of agency action would play the “jurisdictional” card in every case . . . . The effect would be to transfer any number of interpretive decisions—archetypal Chevron questions, about how best to construe an ambiguous term in light of competing policy interests—from the agencies that administer the statutes to federal courts. We have cautioned that “judges ought to refrain from substituting their own interstitial lawmaking” for that of an agency. That is precisely what Chevron prevents.
On this account, City of Arlington is the case that saved Chevron.
This Part assesses just what version of Chevron survived, using this controversy to elucidate the approach to Chevron outlined above, concluding that both the majority and the dissent are consistent with it.
A. Defining “Jurisdictional” Questions
Justice Scalia’s opinion for the Court rejected the idea that a distinct category of jurisdictional questions even existed and admonished that “judges should not waste their time in the mental acrobatics needed to decide whether an agency’s interpretation of a statutory provision is ‘jurisdictional’ or ‘nonjurisdictional.’”
Echoing his long-ago opinion in Mississippi Power & Light,
Justice Scalia wrote that it just does not matter whether an agency action is characterized as marking an improper assertion of power or an improper application of an accepted power. In either event, if the charge is substantively correct, the agency action is ultra vires. The real question is therefore “always, simply, whether the agency has stayed within the bounds of its statutory authority.”
As such, “there is no principled basis for carving out some arbitrary subset of such claims as ‘jurisdictional.’”
Despite Justice Scalia’s objections, it is possible to define “jurisdictional questions” coherently. One clear and administrable definition is that they are disputes over an agency’s authority to regulate particular persons, activities, or geographical locations. For example:
- The Army Corps of Engineers interprets “waters of the United States,” discharges into which require a Clean Water Act permit from the Corps, to include wetlands.
- The Food and Drug Administration determines that nicotine in cigarettes is a drug, the cigarette a drug-delivery device, and that the agency can regulate both under the Federal Food, Drug, and Cosmetic Act.
- The EPA determines that greenhouse gases are not “air pollutants” and therefore it cannot regulate them under the Clean Air Act.
- The Federal Trade Commission (FTC) determines that lawyers and law firms are “financial institutions” subject to the Gramm-Leach-Bliley Financial Modernization Act.
- The Federal Energy Regulatory Commission determines that a promise to forgo consumption of electricity that would have been purchased in a retail-electricity market is not a “sale of electric energy” (and so subject to state rather than federal regulation) under the Federal Power Act.
- The Fish and Wildlife Service concludes that privately owned property can be an “area under Federal jurisdiction” for purposes of the Endangered Species Act.
- The Commodity Futures Trading Commission asserts authority to adjudicate counterclaims.
- The Occupational Safety and Health Administration interprets a statute mandating protection for all workers as applying only to the manufacturing sector.
- The NLRB determines that newsboys are employees (rather than independent contractors) and therefore within the protection of the National Labor Relations Act.
- The Mine Safety and Health Administration determines that a vendor who delivered steel to a mine qualifies as an “operator” of the mine subject to the requirements of the Federal Mine Safety and Health Act.
Many pre-Arlington commentators seemed to operate from this definition of a jurisdictional question.
It is also, possibly, the view Justice Scalia took in Arlington. Of course, because his bottom line was that jurisdictional questions are indistinguishable from nonjurisdictional questions, he did not have to, and perhaps could not, explain exactly what a jurisdictional question is. Still, his premise seems to be that such questions are of the sort in the list above. Thus, he refers to a brief that “explains, helpfully, that ‘[j]urisdictional questions concern the who, what, where, and when of regulatory power: which subject matters may an agency regulate and under what conditions.’”
In addition, noting that “[t]he U.S. Reports are shot through with applications of Chevron to agencies’ constructions of the scope of their own jurisdiction,”
he cites primarily (though not exclusively) cases about whether the agency had authority over particular persons or activities: cigarettes, wetlands, particular toxic pollutants, “pole attachments.”
And he relies in particular on NLRB v. City Disposal Systems, Inc., which explicitly stated that no “exception exists to the normal [deferential] standard of review” for “jurisdictional or legal question[s] concerning the coverage” of an Act.
On this definition of a jurisdictional question, the majority was clearly correct that Chevron should apply with full force. Numerous precedents had invoked Chevron in such settings;
none had said it was inapplicable; agency self-aggrandizement or abuse are not greater threats with regard to jurisdictional issues than with regard to substantive ones; and all the various rationales for Chevron apply equally to jurisdictional and substantive questions. Indeed, not only does Chevron apply to jurisdictional questions so understood, these are the paradigmatic Chevron questions because they are disputes over the boundaries of vague terms.
On the other hand, Chief Justice Roberts’s dissent is also correct. Joined by Justices Kennedy and Alito, the Chief Justice described the question as being whether court or agency determines whether Congress has delegated to the agency authority to act with the force of law.
That is the threshold requirement for Chevron to apply, and in his view it is necessarily a matter for judicial decision. He began with an admirably succinct summation:
A court should not defer to an agency until the court decides, on its own, that the agency is entitled to deference. Courts defer to an agency’s interpretation of law when and because Congress has conferred on the agency interpretive authority over the question at issue. An agency cannot exercise interpretive authority until it has it; the question whether an agency enjoys that authority must be decided by a court, without deference to the agency.
This is exactly right. But it rests on a different definition of a “jurisdictional question” than the majority’s. To have jurisdiction is to have authority to decide. The dissent focuses not on whether an agency has authority to regulate particular places or things, but rather whether it has authority to regulate at all, that is, whether it has authority to act with the force of law. Applied to Chevron, the question is not whether agencies should receive deference regarding their determinations of what persons or activities fall within their authority, but rather whether they should receive deference regarding their determinations of whether they have the authority to act with the force of law, period.
On this conception, applying Chevron to jurisdictional questions is deeply problematic. Chevron applies because the agency has been delegated authority; because the delegation is a condition precedent of deference, it is circular to defer to a determination that the delegation exists. As one influential article put it:
One reason courts should refuse to extend Chevron deference to agencies’ jurisdictional interpretations follows from the nature of Chevron itself: The existence of agency jurisdiction is a precondition of Chevron deference, and Chevron therefore has no bearing on how that threshold question should be resolved. Only after it is determined that Congress has conferred jurisdiction on an agency does Chevron come into play.
This is Chief Justice Roberts’s point. He rightly insists that courts, not agencies, must determine which questions are within an agency’s Chevron power to resolve with the force of law.
In fact, Justice Scalia would seem to agree. He asserts essentially the same proposition at the end of his opinion:
The fox-in-the-henhouse syndrome is to be avoided not by establishing an arbitrary and undefinable category of agency decisionmaking that is accorded no deference, but by taking seriously, and applying rigorously, in all cases, statutory limits on agencies’ authority. Where Congress has established a clear line, the agency cannot go beyond it; and where Congress has established an ambiguous line, the agency can go no further than the ambiguity will fairly allow.
The ships-passing-in-the-night aspect of the opinions is highlighted by looking at subsequent cases that rely on City of Arlington. For example, Pharmaceutical Research & Manufacturers of America v. FTC was a challenge to an FTC regulation issued under the Hart-Scott-Rodino Antitrust Improvements Act that required pharmaceutical companies to report certain transfers of exclusive patent rights.
The challengers argued that the statute did not permit the FTC to impose these obligations on only a single industry; it read the statute to authorize only rules of general application that would cover all transfers of exclusive patents. The district court applied Chevron, laying out the two-step test. It cited City of Arlington for the propositions that Chevron applies to jurisdictional determinations and that there is no difference between exceeding the scope of authority and exceeding authorized application of authority. It then concluded the “FTC is Entitled to Deference on Scope of Statutory Authority,” i.e., on the question whether it could issue a rule limited to a particular industry.
A thorough review of text, history, and purpose indicated no particular congressional view on industry-specific regulations; thus, since the statute did not address the “precise question,” it was on to step two, which, of course, the regulation survived.
So what happened here in City of Arlington terms? The court thought it was doing what the majority in City of Arlington told it to: Apply Chevron to a question about the scope of agency authority. That question was whether the FTC could write a regulation about a single industry even though the relevant statute applied to mergers and the transfer of assets generally. One could describe that as a jurisdictional issue, though it is a slightly odd one, being about whether the greater includes the lesser rather than which industries are regulable at all. So the case could be seen as a perfect illustration of Justice Scalia’s reasoning and application of his conclusion: It is hard to distinguish jurisdictional from non-jurisdictional questions, the key issue is whether the agency has violated the statute, and where the statute is ambiguous, the court should accept the agency’s reading as long as it is permissible.
But the Pharmaceutical Research decision was also completely consistent with Chief Justice Roberts’s dissent in City of Arlington. The court did not “defer to [the] agency on whether Congress has granted the agency interpretive authority over the statutory ambiguity at issue.”
It decided entirely on its own whether this was a case in which deference was mandated. It may not have done a great job at that (it essentially skipped step zero and only inquired whether the statute was ambiguous), but it was only going to defer if it found the statute ambiguous and ultimately made an independent determination that it was. Of course, the FTC had said that the statute was ambiguous,
but the court did not defer on that question.
This discussion can be restated in terms of Chevron “step zero.”
That term, which has never been invoked by the Supreme Court itself, refers to the threshold inquiry as to “whether the Chevron framework applies at all.”
The leading case is United States v. Mead Corp., which held that Chevron only applies if Congress has delegated authority to write rules with the force of law and the agency has used that authority.
Mead coexists somewhat uncomfortably with decisions that interpret statutory ambiguity itself to be a delegation to the agency; the Court’s “cases find in unambiguous language a clear sign that Congress did not delegate gap-filling authority to an agency; and they find in ambiguous language at least a presumptive indication that Congress did delegate that gap-filling authority.”
Courts never defer in step zero. Thus, another way of explaining the difference between Justice Scalia and the Chief Justice in City of Arlington is that the former understood the case to be about how Chevron applies and the Chief Justice understood it to be about whether Chevron applies. Justice Scalia is completely correct that in deferring (or not) under Chevron, jurisdictional questions should not be treated any differently from other questions of statutory meaning. Chief Justice Roberts is completely correct that courts should not yield to agency understandings of whether Chevron kicks in or whether a statute is ambiguous.
Finally, to return to “space” and “weight”: In a Chevron step-two case, the court’s role under the statute is to ensure that the agency has stayed within its space, that its interpretation is not unreasonable. It is hard to understand how a court could grant Chevron deference to that determination even if it wanted to. Both Justice Scalia and Chief Justice Roberts in fact endorse that understanding in City of Arlington. Where they go astray, on the Straussian account, is the failure to accord Skidmore deference to questions about statutory meaning.
B. “Jurisdictional” Questions and the APA
Ignored in all this is the text of the APA itself. The Act does actually refer to jurisdictional questions. Not surprisingly, it lumps them together with other sorts of statutory questions. Specifically, section 706 provides that a reviewing court “shall . . . hold unlawful and set aside agency action . . . found to be . . . in excess of statutory jurisdiction, authority or limitations, or short of statutory right.”
The APA has a tendency toward the thesauric; often a string of nouns appears where a more parsimonious drafter might have used just one or two.
But this reflects care and precision, not sloppiness. The no-surplusage canon admonishes us to take each of those words seriously, as indicating something distinct. And indeed, many APA provisions set out a string of not-quite-synonyms, the differences between which should be taken seriously. Especially with phrases as familiar and well-worn as the key provisions of the APA, it can be helpful to read the text with fresh eyes.
The scope-of-review provisions of the APA are one prominent example of cover-the-waterfront drafting. Not just “arbitrary,” but “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”
Not just “unconstitutional,” but “contrary to constitutional right, power, privilege, or immunity.”
And not just “contrary to a relevant statute,” but “in excess of statutory jurisdiction, authority, or limitations, or short of statutory right.”
If we take that wording seriously, it means a reviewing court has the same authority (or lack thereof) to determine whether an agency has exceeded its statutory jurisdiction that it has with regard to reviewing other statutory limitations or authorizations. That is a textual argument that the great textualist ignored.
On the other hand, the text of this provision undercuts Justice Scalia’s opinion as well. By referring separately to “jurisdiction” and “authority,”
the APA indicates that they are two distinct things. Yet the basis of Justice Scalia’s entire opinion is that there is no distinction between them. In a case arising under the APA, his job was to at least try to figure out how these two separately identified concepts differ, even if the question presented treated them as synonyms. Defining “jurisdiction” as being about the persons, places, and things that an agency can regulate, and “authority” as being about the manner and extent of permissible agency regulation of those things over which it has jurisdiction, serves to give each word independent meaning.
Section 706(2)(C) is a Goldilocks provision. Agencies cannot go too far, but they also cannot fail to go far enough. Not too cold and not too hot; neither in excess of maxima nor shy of minima. In a passing comment, Professor Strauss has suggested this formulation may be a statutory peg on which to hang the idea of Chevron space. The court must ensure that the agency’s reading does not exceed statutory boundaries, that it is inconsistent neither with what the statute must mean (“short of statutory right”) nor what it can mean (“in excess of statutory jurisdiction”).
It would be delightful if the APA really did articulate the concept of Chevron space, but this reading imposes more on the text than it will bear. On the most natural reading of the text, the “in excess of” and “short of” language does not define boundaries of a “geographical” sort. Rather it speaks to the qualitatively different kinds of limitations a statute can impose: Some provisions impose restrictions, some impose obligations.
That does not undercut the Chevron space conceptualization; it just means that the drafters of the APA did not write it into the statute.
The argument here is for a reading of Chevron that is both weaker and stronger than that often proposed. On the one hand, courts retain an essential and meaningful role in determining the boundaries of Chevron space; they have real work to do. On the other hand, in doing that work, the views of the agency can never be ignored. Accordingly, there is no agency-free space within which courts interpret statutes.
The familiar and oft-told narrative is that Congress retreats to vague generalities in order to achieve agreement and, in an effort to take credit and avoid blame, leaves the hard issues to others to decide. Chevron’s great strength is that it recognizes this narrative is sometimes accurate and admonishes that when it is judges should yield to agencies because of their comparative advantage in policymaking. But this narrative is not always accurate. Sometimes Congress does make a decision. Chevron’s great risk is that it invites judges and agencies to ignore what Congress has decided, discovering uncertainty and discretion where they do not exist.
Some scholars would essentially write courts out of the picture in statutory cases, concluding that agencies always have a comparative advantage.
Peter Strauss wisely warns against such an abandonment of the judicial role, while still granting due weight to agency interpretation and, within the congressionally established and judicially policed Chevron space, respecting agency construction. So understood, Chevron is not a revolutionary shift of authority from the judiciary to the executive. That Chevron is dead. Rather, Chevron is an appropriate allocation of decisionmaking responsibility among the three branches, relying on the judiciary to enforce congressional decisions, but protecting agency authority and discretion where Congress has left the decision to the executive. Long may it reign.