In June 2024, the Supreme Court decided Loper Bright Enterprises v. Raimondo and overturned the four-decade-old Chevron doctrine. The practical consequences for businesses that deal with federal regulators are still unfolding — and they cut in multiple directions.
What Chevron Was
Since 1984, Chevron U.S.A., Inc. v. Natural Resources Defense Council had required federal courts to defer to a federal agency's reasonable interpretation of an ambiguous statute it administered. If the EPA interpreted the Clean Air Act in a particular way, courts would uphold that interpretation as long as it was "reasonable" — even if the court would have read the statute differently.
This gave agencies enormous power to expand or contract their own authority through interpretation, with limited judicial check.
What Loper Bright Changed
The Court in Loper Bright held that courts must exercise their own independent judgment about what a statute means — they can no longer simply defer to an agency's reading. Under the Administrative Procedure Act, courts are required to decide legal questions for themselves.
This does not mean agencies lose. An agency's interpretation of a statute it administers may still be persuasive, particularly when the agency has deep technical expertise. But the deference is gone. Courts are the final word on what the law says.
The Business Implications
Regulatory uncertainty in the short term. Existing rules built on Chevron-era interpretations are now more vulnerable to legal challenge. Industries that have long operated under rules they found burdensome have new grounds to litigate.
Slower agency action in some areas. Agencies now know their statutory interpretations will receive closer judicial scrutiny. Expect more conservative rulemaking in legally uncertain areas — and more litigation when agencies push the boundaries.
More power to Congress. If courts won't fill statutory gaps with agency interpretations, Congress must write clearer statutes. This shifts leverage back toward the legislative branch and toward lobbying at the front end of the policy process.
Increased value of legislative monitoring. With judicial deference to agencies reduced, the text of the underlying statute matters more than ever. Businesses need to track not just what agencies are doing, but what Congress is writing.
We'll continue covering the downstream effects of Loper Bright as courts apply it to specific regulatory contexts. If your industry is dealing with an active rulemaking or litigation that touches on this question, reach out.