Yesterday the Supreme Court rebuked the regulatory state and decided that the federal courts can’t give government bureaucrats carte blanche to interpret our laws how they choose. This decision opens the door for other cases to rein in many government agencies’ out-of-control regulatory power.
This ruling in Kisor v. Wilkie bolsters Vietnam veteran James Kisor’s effort to receive benefits for the PTSD he suffers as a result of his service to our nation.
The U.S. Department of Veterans Affairs denied Kisor’s PTSD claim by changing the rules on him: He presented records that were “relevant” to his claim (i.e., showing his combat service), as the VA regulations require. But the VA “re-interpreted” the word “relevant” to exclude Kisor’s combat records, and then conveniently concluded that without “relevant” records, he wasn’t entitled to benefits.
Sadly, the lower federal courts let the VA get away with this under a 1997 Supreme Court deference doctrine, named for a case called Auer v. Robbins, that favors government agencies. Under so-called Auer deference, courts generally must let agencies decide what their regulations mean, particularly when an agency chooses a legally suspect meaning. This gives the government a big finger on the scales of justice, and harms individual liberty.
Fortunately for Mr. Kisor, the Supreme Court took his case, and ruled that the lower courts had to take another look at whether his combat records are “relevant” under the VA regulations. In doing so, the Court held that the lower courts may not reflexively defer to agency claims about what their regulations mean.
Although the Court did not overrule Auer entirely, as many argued it should, the Justices did restrict when agency interpretations can bind the courts. Judges must first use all the tools of statutory construction to determine whether a regulation is clear in the first place. Where a regulation is not clear, an agency interpretation of it must be within the range of ambiguity. The agency must also demonstrate its intent that the interpretation be controlling, and that the agency is using its expertise in the particular subject matter. Ad hoc interpretations by low-level agency staff, and after-the-fact litigation positions, will no longer command judicial deference. And finally, courts are no longer to defer to agency interpretations that inflict “unfair surprise” on regulated parties.
These are all good reforms, even if the result is that courts will still defer in limited circumstances. Many of Pacific Legal Foundation’s clients will now get a fairer hearing in their cases against federal agencies as a result of Kisor.
Many courts, empowered by Kisor, will heed the Supreme Court’s limitations on Auer deference (perhaps henceforth to be called Kisor deference), and subject agencies to meaningful checks and balances. Others may continue to “reflexively defer.” If that “reflexive deference” remains the norm, we are hopeful that in the future, the Supreme Court will end judicial deference to agency regulatory interpretations entirely.
A majority of the Justices also made clear in Kisor that on the separate question of whether courts should defer to agency interpretations of statutes (so-called Chevron deference, named for the 1984 SCOTUS ruling in Chevron U.S.A. v. Natural Resources Defense Council), they see that issue as independent of the Kisor ruling. This suggests that the controversial Chevron deference may also be ripe for fundamental reform or abrogation as the Court moves forward.