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Court Signals Limits on Deference to Regulators

The Supreme Court’s recent decision on the EPA’s mercury rules may mark a re-evaluation of the deference that justices typically afford environmental regulators to interpret the laws they must carry out.

The EPA has notched a number of wins in federal appeals court and at the high court itself based on a 1984 case — Chevron U.S.A. Inc. v. Natural Resources Defense Council Inc. — where the Supreme Court ruled judges should defer to agency interpretations of ambiguous statutes they administer, unless the regulatory actions are unreasonable.

Given the technical and scientific nature of the EPA’s rulemakings, jurists have deferred to regulators’ expertise in a number of cases using that principle. One recent example is the Supreme Court’s 2014 decision upholding the agency’s regulation of toxic emissions that blow across state lines.

But the high court’s conservative justices indicated in their June 29 ruling against the EPA’s mercury regulation that they won’t always give regulators wide latitude to read laws like the Clean Air Act.

“Even under this deferential standard, however, ‘agencies must operate within the bounds of reasonable interpretation,’” Justice Antonin Scalia wrote in the majority opinion of Chevron deference. “EPA strayed far beyond those bounds when it read [the Clean Air Act] to mean that it could ignore cost when deciding whether to regulate power plants.”

Thomas A. Lorenzen, a former Justice Department environmental official who is now a partner at Crowell & Moring, said the decision shows that the court’s conservative wing perhaps isn’t as “comfortable” with the deference concept as it once was. This comes as the court is likely to take up all-but-guaranteed challenges to the EPA’s Clean Power Plan in the years ahead.

“I think what we’re seeing here is that the Chevron doctrine is starting to show some cracks, at least among some of the conservative justices on the Supreme Court,” he said.

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