The Supreme Court’s opinion in Loper Bright Enterprises v. Raimondo, overturned the 40-year-old Chevron doctrine and eliminated the requirement that courts defer to agencies’ interpretations of ambiguous statutes. In a 6-3 opinion, the majority held that the Administrative Procedure Act (“APA”) requires courts to exercise “independent judgment” in determining the meaning of statutory provisions, although they may still “seek aid” from well-reasoned or long-standing interpretations by agencies. This decision has been touted as fundamentally reshaping administrative law and the deference courts should give to agency rulemaking and regulatory interpretations. However, in the area of international trade litigation the Court’s ruling may have less impact.
For years, international trade agencies such as the Commerce Department or the U.S. International Trade Commission cited the Chevron doctrine deference as the basis for courts to uphold their agency level decisions in promulgating and implementing their regulations. Under the doctrine's two-step test, judges were tasked with first determining whether statutory language was ambiguous, and then whether an agency's interpretation of it was reasonable. If the answer to both questions was yes, courts were obligated to rule in the agency’s favor. In practice, these regulations and agency interpretations were often seen as taking a protective view of trade and resulting in expanded coverage of the agency’s actions and increased costs to importers.
Notwithstanding the Court overturning the Chevron doctrine previously used to defend trade agencies’ actions, potential litigants may still face judicial hurdles to challenging trade agency interpretations. Many trade-related cases are not brought under the APA, but rather are under trade-specific statutes that do not provide courts with the same level of authority over questions of law as does the APA. Courts may still look to an agency’s interpretation of a statute for guidance, particularly if it is long-standing or well-reasoned. As noted in the Court’s majority opinion, and challenged in the minority dissent, agencies will still be given “respectful consideration” under Skidmore v. Swift & Co, a pre-Chevron mode of analysis used by courts to consider agency interpretations.
While the prior case law of the Federal Circuit and U.S. Court of International Trade supporting existing agency practices remains intact following the Loper decision, the question remains as to how impactful the Court’s decision in Loper will be for agency actions that change or vary from their previously approved practices, or where agencies promulgate new regulations or practices for deciding trade matters. One commentator, Gary Hufbauer of the Peterson Institute for International Economics, observed that:
“[The Loper decision] only applies where regulations were previously challenged and upheld under Chevron. There may be some past regulations which have been on the books for a long time that will [now] be challenged."
Time will tell whether the Supreme Court’s opinion striking down the Chevron doctrine while keeping prior precedent supporting trade agencies' interpretations has managed to stave off a wave of litigation challenging trade regulations, or whether it creates enough of a crack in the dam of deference for litigants to challenge new actions by trade agencies and rely on the courts to decide “the relevant questions of law."
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