Legal Sidebari
Chevron Deference in the Courts of Appeals
June 8, 2023
Chevron U.S.A. v. Natural Resources Defense Council is one of the most important cases in administrative
law. Decided in 1984, it was the genesis of a legal framework for federal courts to apply when deciding
whether to defer to a federal agency’s interpretation of a statute. It has, however, become
an increasingly
controversial precedent that the Supreme Court has applied less and less frequently over the last decade.
The Court is now poised to revisit
Chevron in the upcoming case
Loper Bright Enterprises v. Raimondo.
The courts of appeals decide many more
Chevron cases than the Supreme Court, and they play an
important role in shaping the
Chevron framework. In general, the courts of appeals apply
Chevron more
often than the Supreme Court and application of the
Chevron framework in the courts of appeals has a
greater bearing on the outcome of the case than at the Supreme Court. An examination of federal courts of
appeals practices applying the
Chevron framework therefore sheds light on how the
Chevron framework
operates in the vast majority of cases where it is at issue.
A handful of studies have evaluated how the courts of appeals apply
Chevron, and the picture that
emerges is markedly different from the way the Supreme Court applies it. Furthermore, a close
examination of the courts of appeals practices themselves reveals significant variations in how
Chevron is
applied. Studies have identified large variations in how courts apply
Chevron depending on which court
heard the appeal, the agency party to the case, and the subject matter of the appeal, among other factors.
Given this patchwork application of the
Chevron framework it can be difficult for agencies and Congress
to reliably predict which agency’s statutory interpretation will receive deference under the
Chevron framework. Regardless of the Supreme Court’s consideration of
Loper Bright Enterprises, Congress
likely has the authority to codify, modify, or eliminate
Chevron deference, and therefore can shape
through legislation how the federal courts review agency interpretations of federal statutes.
Background
The Chevron framework is one of a suite of related doctrines that sets out the circumstances under which
courts must defer to an executive agency’s interpretation of a federal statute that it administers. Under the
Chevron framework, a court must defer to an executive agency’s interpretation of an ambiguous statute
that it administers so long as the agency’s interpretation is reasonable. The framework takes its name from
a 1984 Supreme Court case,
Chevron U.S.A. v. Natural Resources Defense Council, which sets out a two-
step process for determining whether a court must defer to an agency’s statutory interpretation.
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The
Chevron framework of review usually applies if Congress has given an agency the general authority
to make rules with the force of law. If a court
determines that Chevron applies, at step one it will use the
traditional tools of statutory construction to determine whether Congress directly addressed the precise
issue before the court. If the statute is clear on its face with respect to the issue before the court, the court
must implement Congress’s stated intent. If the court concludes instead that a statute is silent or
ambiguous with respect to the specific issue, the court then proceeds to
Chevron’s second step. At step
two, courts must defer to an agency’s reasonable interpretation of the statute. The
Chevron framework
rests on several relate
d assumptions, including that statutory ambiguity indicates congressional delegation
of interpretive authority; agencies have more expertise interpreting the statutes they administer; and
agencies are politically accountable and therefore have more claim to make policy than courts.
Chevron is unquestionably one of the foundational decisions in administrative law. A search of the
Westlaw electronic database indicates that, at the time of this writing, the Supreme Court and lower
federal courts have cited the
Chevron decision more than 18,000 times. In the last decade or so, however,
the
Chevron framework has come under increasing fire from various corners of legal academia, the
courts, and the political branches. Over that same period, the Supreme Court has relied on the
Chevron framewor
k less and less. It is difficult to identify a single cause for the Court’s recent silence on
Chevron,
but changes in the Court’s personnel as well as increasing attacks from some corners of academia may
account for some of the Court’s reluctance to rely on the doctrine. In the Court’s most recent full term,
Chevron went unmentioned in three cases where an agency interpretation of federal law was at issue,
leading some t
o speculate that the Court might soon overrule or at least curtail the
Chevron framework.
Supreme Court litigators have been equally unwilling to invoke
Chevron before the Court. In a notable
exchange i
n a 2019 oral argument, a prominent Supreme Court advocate concluded by admitting “I hate
to cite it, but I will end with
Chevron.”
Adding to the speculation about the fate of
Chevron, in late 2022, the Court declined to hear
Buffington v.
McDonough—a case that presented the Court the opportunity to revisit
Chevron and possibly provide
clarity to the lower courts. Justice Gorsuch issued a dissent calling attention to the growing differences
between the Court’s application of
Chevron and the courts of appeals, noting that while the Supreme
Court appears content to ignore
Chevron, the lower courts do not have that luxury. (Supreme Court
decisions are binding on all lower courts.) The Court, he argued, owes the lower courts clarity by
explicitly overruling
Chevron.
The Court may ultimately provide clarity to the lower courts when it decides
Loper Bright, which it is
scheduled to hear in its October 2023 term. I
n agreeing to hear Loper Bright, the Court explicitly confined
its consideration to the question whether it should overrule or clarify
Chevron.
Chevron in the Courts of Appeals
Differences Between the Supreme Court and Courts of Appeals
Although the Supreme Court may have
reduced its application of
Chevron over the last decade, the courts
of appeals have not. Because Supreme Court decisions bind lower federal courts, they generally must
apply the
Chevron framework when reviewing agency interpretations of statutes that the agency
administers.
Differences between the way the Supreme Court applies
Chevron and the way the courts of appeals apply
it are nothing new. A
2017 study that evaluated over 1,300 courts of appeals cases from 2003 to 2013—
the largest study of courts of appeals decisions that refer to
Chevron—found that the courts of appeals on
average applied
Chevron in
close to three-quarters of cases addressing agency interpretations. From
roughly the mid-1980s to the mid-2000s, studies found that the Supreme Court applied
Chevron to about
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one-quarter t
o one-third of cases where an agency interpretation is at issue. That number dropped to zero
in the Court’s most recent full term, continuing a decade-long trend of referring less and less to
Chevron.
A subsequent
study that surveyed courts of appeals cases from 2020 to 2021, however, revealed that
courts of appeals still apply
Chevron at similar rates as those founds in the 2017 study. In the more recent
study, courts of appeals applied
Chevron in close to 85% of cases where an agency interpretation was at
issue.
Further, agencies were significantly more likely to prevail when a court applied the
Chevron framework
(77.4%)—even if the court decided that the statute was unambiguous and did not defer to the agency’s
interpretation—than when a court applied no deference regime whatsoever
(38.5%). Conversely, at the
Supreme Court, various studies have found that the application of
Chevron has little effect on the outcome
of the case. At the Supreme Court, a 2006 study found that agencies prevailed about
76% of the time
when the Court applied
Chevron—similar to agencies’ win rate in cases where the Court did not apply
Chevron. This difference has led some to claim that there is a
“Chevron Supreme and a Chevron Regular.”
Given the Supreme Court’s recent silence on
Chevron, the gap between the Supreme Court and the courts
of appeals has only widened.
Differences Between Resolution at Step One and Step Two
Whether the court resolved the appeal at step one of
Chevron or step two had a significant impact on the
likelihood the agency would prevail. Drawing from the 2017 survey that studied over 1,300 cases decided
from 2003 through 2013, the courts of appeals resolved
30% of cases at step one (i.e., the step where
courts ask if the statute is clear), but of those cases, the agency prevailed only
39% of the time. These
rates have largely been
consistent over multiple decades. In the survey of cases from 2020 and 2021, the
proportion of cases decided at step one increased to roughl
y 40% and the agency win rate at step one fell
to approximately 33%, indicating that courts of appeals may be becoming less deferential.
In the same 2017 study
, 70% of agency interpretation cases make it to step two, in which courts ask if the
agency’s interpretation is reasonable. Nearly all agency interpretations are found to be reasonable at step
tw
o (93.8%). Over the course of the eleven-year study period of the 2017 study (2003-2013), agencies
lost
51 cases out the 817 that made it to step two. Interestingly, the Fourth Circuit did not invalidate a
single agency interpretation at step two in the eleven-year study period. The 2020-2021 study again
indicated that the courts of appeals may be becoming less deferential. Some
59% of cases made it to step
two and agencies won 78% of those cases. Even assuming the more recent survey accurately depicts a
less deferential federal appellate judiciary, the scholars responsible for the survey observed that “[t]he
conventional wisdom is certainly [still] true: Once a court decides to apply the
Chevron framework, the
critical litigation battleground takes place at
step one.”
Different Circuits Apply Chevron Differently
Breaking down the data by circuit reveal
s significant variation between the various courts of appeals. In
the 2017 study referenced above, the D.C. Circuit led the way i
n applying Chevron, relying on it in
approximately 89% of cases that concerned agency interpretations of a statute. The Sixth Circuit applied
Chevron in 61% of cases involving an agency interpretation.
Once a court of appeals applied
Chevron,
they are highly deferential to agencies. The overall agency win
rate across all courts of appeals in the 2017 study was approximately 77%. The most deferential circuit
was the First Circuit, where agencies prevailed in almost 83% of cases. The Ninth Circuit, conversely,
was the least deferential circuit in the study, ruling for the agency in approximately 66% of the cases. The
D.C. Circuit—the circuit often seen as having the most administrative law experience—was in the middle
of the pack (73%). Although the Sixth Circuit applied
Chevron less often than every other circuit, when it
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did apply
Chevron, agencies won 88% of cases. The Second and Seventh Circuits had similar differentials
between applying
Chevron and win rates after
Chevron was applied.
Ultimately, the study authors could not identify a discrete factor that could account for the differences
across circuits. The study authors found that variations in subject matter coul
d account for some of the
variation between circuits. For example, the Ninth Circuit hears a large number of immigration appeals.
Removing those appeals from the 2017 study’s data set, the agency win rate at the Ninth Circuit rose to
74%—roughly in line with the average. Other factors, such as the composition of the panel of judges
hearing the appeal, also accounted for some of the differences.
Agency and Subject Matter are Important
The subject matter of the case and the agency advancing the interpretation was correlated with
Chevron
outcomes in the 2017 study. Courts of appeals applied
Chevron at high rate
s (75%-100%) to cases
involving telecommunications, Indian affairs, and pensions, and courts deferred to agencies under
Chevron at similar rates
(83%-92%) in those same subject matter areas. Conversely, courts applied
Chevron less frequently
(52%-67%) in cases involving housing, tax law, and employment. Furthermore,
even when the courts applied
Chevron in this latter group of cases, win rates for agencies were
comparatively low
(69%-81%). Cases involving energy issues displayed a different pattern: While courts
applied
Chevron in almost every cas
e (96%), the relevant agency w
on 60% of the time when
Chevron was
applied.
There was a significant overlap in case outcomes between subject matter and agency. Nonetheless, there
were some outliers to this trend. Courts deferred under
Chevron to the Surface Transportation Board
(including its predecessor agency, the Interstate Commerce Commission) in all 16 cases involving the
agency in the study
(100%) even though courts deferred under
Chevron in cases involving transportation
issues
81% of the time.
Finally, a handful of agencies prevailed more often when courts did
not apply
Chevron. For instance, the
Federal Trade Commission had a
91% overall win rate, but
a 75% win rate after courts applied
Chevron.
Similarly, the Bureau of Prisons had a
74% overall win rate, but w
on 62% of its cases after courts applied
Chevron.
What Courts of Appeals Judges Think of Chevron
A 2018 study of 42 federal appellate judges surveyed their views on the
Chevron framework, among other
topics. The survey revealed that, with some notable exceptions,
most judges surveyed do not favor the
Chevron framework. For example, some question its key underlying assumptions that ambiguity in
statutory text indicates congressional delegation and that agencies have special expertise interpreting the
statutes that they administer
. All judges surveyed, however, believe they are bound by Supreme Court
precedent to apply the
Chevron framework.
Judges’ views about
Chevron’s fundamental assumptions appear to be reflected in the absence of
discussion of those assumptions in judicial opinions applying
Chevron. Returning to the 2017 study of
over 1,300 courts of appeals cases, the study found that judges rarel
y invoked agency expertise as a
justification for the application of
Chevron, while less than 20% of cases examined whether Congress
granted the agency rulemaking authority.
The study also revealed what it dubbed the
“D.C. Circuit effect.” Unlike their counterparts on other courts
of appeals, judges on the D.C. Circuit are “generally comfortable” with the
Chevron framework and see it
as a “part of the basic wiring” of evaluating agency statutory interpretations. They also appear to be more
comfortable with some of
Chevron’s core assumptions about agency expertise in interpreting the statutes
that they administer and the political accountability of agencies.
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Considerations for Congress
The Supreme Court applies
Chevron differently from the court of appeals, the courts of appeals apply
Chevron differently from one another, and the courts of appeals treat different agencies differently in
applying
Chevron.
Congress likely has the authority to address this patchwork application of
Chevron if it
found it appropriate, or even to eliminate
Chevron altogether
. Article III of the Constitution has been
interpreted to provide Congress the authority to create standards of review for the federal courts and direct
which courts hear certain cases. The House of Representatives in th
e 114th and
115th Congresses passed
the Separation of Powers Restoration Act (SoPRA) that would eliminate the
Chevron framework if
enacted. SoPRA has also been introduced in the
118th Congress. Eliminating
Chevron may not produce
uniform interpretations of federal statutes across the federal courts, however. If the lower courts were no
longer required by
Chevron to defer to some agency interpretations, they would be more likely to rely on
their own interpretations of federal law, and different courts may end up differing on their interpretations
of the same provisions.
Congress also likely has the authority to require courts to apply the
Chevron framework, although some
have argued that
Chevron violates Article III by transferring interpretive authority from the courts to the
executive branch. If Congress were to require the application of the
Chevron framework, it could do so in
a number of different ways. For instance, it could require courts to apply
Chevron in all cases of agency
statutory interpretation. It could attempt to prescribe additional standards for the application of
Chevron as a way to bring consistency to the practices of the courts. It could also require courts to apply
Chevron
in some cases of agency statutory interpretation, but not others. Finally, an additional way to reduce the
patchwork application of
Chevron might be for Congress to direct certain courts to hear cases arising
from particular agencies, as the D.C. Circuit already does for some kinds of
agency actions.
Author Information
Benjamin M. Barczewski
Legislative Attorney
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