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U.S. Supreme Court to Decide to Which Extent Agencies Can Interpret Their Own Regulations

June 5, 2019   |  

Any lawyer or law student can recite the familiar test of Chevron deference: If a statute is ambiguous – that is, if Congress’ intent is not clear or if the statute is silent on a topic – federal courts will defer to an agency’s regulations interpreting that statute. But a lesser-known doctrine extends Chevron to the next level, generally requiring courts to defer to that agency’s interpretation of its own regulation. Known as Auer or Seminole Rock deference, this principle’s modern grounding comes from U.S. Supreme Court Justice Antonin Scalia’s opinion in Auer v. Robbins, 519 U.S. 452 (1997).

That grounding has been tested in 2019, as the Supreme Court heard oral arguments in March in Kisor v. Wilkie.

In short, Auer holds that an agency’s interpretation of its own regulation is controlling unless “plainly erroneous or inconsistent with the regulation.” Auer deference is frequently used in civil litigation – recent Supreme Court reviews of suits against drug manufacturers, credit card issuers, and auto manufactures all included deference to an agency’s interpretation of its own regulations.

In the years after Auer, Justice Scalia’s support for Auer deference eroded, as noted in Garco Construction, Inc. v. Speer, 138 S. Ct. 1052, 1053 (2018) (Thomas, J. dissenting from the denial of certiorari) (“Even the author of Auer came to doubt its correctness.”). In addition, both Chief Justice Roberts and Justice Alito have acknowledged the potential for the court’s departure from Auer, discussed in detail in Defying Auer Deference: Skidmore as a Solution to Conservative Concerns in Perez v. Mortgage Bankers Association. And Justice Thomas noted that the doctrine was “on its last gasp” in 2016 in United Student Aid Funds, Inc. v. Bible, 136 S. Ct. 1607, 1608 (2016) (Thomas, J. dissenting from the denial of certiorari) (cataloging instances in which justices “have repeatedly called for [Auer’s] reconsideration in an appropriate case”).

With the additions of Justice Gorsuch and Justice Kavanaugh to the court, commentators began to predict that Auer deference would take its last breath sooner rather than later. Indeed, both new justices have hinted at a willingness to overturn the Auer line of cases; in Garco Construction, Justice Gorsuch joined Justice Thomas’s dissent from denial of certiorari, which calls for reconsideration of Auer deference and “illustrates the problems that the doctrine creates.” In a 2016 Bloomberg BNA article, Kavanaugh: 3 Scalia Dissents Will Become Law of Land, the author captured Justice Kavanaugh’s thoughts, saying “Scalia’s rejection of ‘Auer deference’ . . . will also become the law of the land.”

It is with this backdrop that Kisor v. Wilkie was argued at the Supreme Court on March 27, 2019. Kisor, which relates to a Vietnam War Marine’s military benefits, explicitly asks the court to overrule Auer. At oral argument, the justices engaged on the question – though it is unclear whether five votes exist to dispose of the doctrine completely. Whether the court rejects or reinforces Auer, Kisor will inform the availability of deference to an agency’s interpretation of its own regulation. It will further reveal the new Supreme Court’s tendencies on agency deference in general, which could foreshadow the fate of other administrative law doctrines, such as Chevron itself. Civil litigators of all stripes should closely watch for the Kisor decision, likely to be issued in summer 2019.

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