No New Doctrine in West Virginia v. EPA

For all the airplay the case received, last summer’s decision in West Virginia v. EPA is much ado about nothing—or at least much ado about less than it may first seem. Aside from a minor squabble over the type of evidence that triggers the application of the Major Questions Doctrine, the case offers—quite literally—only a nominal development in doctrine. That is, the singular advance in the case is that it is the first time the Court expressly names the “Major Questions Doctrine” in a majority opinion.

Nonetheless, naming the doctrine provides a focal quality to a line of earlier cases developing and applying a two-tiered approach to administrative rule-making. Without any substantive change in the existing precedent, however, naming and applying the doctrine in this case signals an apparent ending point to the current Court’s willingness to extend anti-delegation doctrines even further.

Similarly, for all the smoke in the dissent, it casts very little heat. Justice Kagan expressly concedes the majority’s reading of the precedent cases’ central holdings. While Kagan’s dissent disputes the application of the Major Questions Doctrine in this particular case, she in fact expressly recognizes the two-tiered judicial approach toward administrative rule-making of existing precedent.

The Formalization of Two-Tiered Judicial Review

West Virginia v. EPA concerns the administrative interpretation of Section 111 of the Clean Air Act. The interpretation at issue would allow the EPA the possibility of forcing operators of existing power plants to reduce carbon emissions by shifting the generation of energy from coal- or natural-gas-fired plants to other generation systems such as wind or solar. This interpretation is opposed to one that would narrowly limit the EPA to requiring improvements in the existing plants themselves.

The decision names and applies a line of cases that created a two-tiered system of judicial review of administrative rule-making decisions. The basic default tier of review is articulated in the 1984 case of Chevron U.S.A., Inc. v. NRDC. In Chevron, the Supreme Court announced a highly deferential approach to judicial review of administrative rule-making decisions when Congress “has not directly addressed the precise question at issue” in its legislation. When the law that delegates authority to an administrative agency is “silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute” (emphasis added).

Needless to say, requiring that judges defer to any “permissible” interpretation of statutory authority by an agency gives broad discretion to executive agencies.

Despite the breadth of Chevron—or perhaps because of it—several years after the decision the Supreme Court began carving out exceptions to Chevron deference. Without repudiating Chevron’s default approach to interpreting statutory delegations, the Court began to identify conditions in some cases under which courts need not defer to any “permissible construction” of administrative rule-making authority. Rather it identified a narrower scope of deference to agency interpretations, and a correspondingly broader scope for courts to exercise and apply their own interpretive judgments.

What is new in West Virginia v. EPA is that, in applying this heightened form of scrutiny for administrative rules, a majority of the Court for the first time in its cases uses the label, “Major Question Doctrine,” for this set of earlier cases. But the Court only names and applies the already existing line of doctrine establishing a system of two-tiered judicial review of administrative rule-making decisions. It does not extend the doctrine itself in West Virginia v. EPA.

What Triggers the Major Questions Doctrine?

So what triggers heightened review of administrative rules under the Major Questions Doctrine? In his concurring opinion, Justice Gorsuch identified three triggers for which “clear congressional authority is required”—rather than merely “possible” congressional authorization–for an exercise of administrative rule-making:

[1] “[W]hen an agency claims the power to resolve a matter of great ‘political significance.’”

[2] “[W]hen [an agency] seeks to regulate ‘a significant portion of the American economy.’”

[3] “[W]hen an agency seeks to ‘intrud[e] into an area that is the particular domain of state law.’”

Once triggered, the next question that judges must answer is “what qualifies as a clear congressional statement authorizing an agency’s action”? Gorsuch identified four areas in which courts traditionally look to determine whether Congress has made a clear statement of delegation:

[1] “[C]ourts must look to the legislative provisions on which the agency seeks to rely ‘with a view to their place in the overall statutory scheme.’”

[2] “[C]ourts may examine the age and focus of the statute the agency invokes in relation to the problem the agency seeks to address.”

[3] “[C]ourts may examine the agency’s past interpretations of the relevant statute.”

[4] “[S]kepticism may be merited when there is a mismatch between the agency’s challenged action and its congressional assigned mission and expertise.”

Notably, the Major Questions Doctrine does not prohibit congressional delegation of rule-making authority on major questions. Rather, it merely requires that when Congress delegates rule-making authority on a major policy question, it must do so clearly.

A Focal Boundary to Delegation Doctrine Development

On non-major questions, Chevron deference remains the Court’s default approach. A merely “possible” reading of a statute by the administrative agency is sufficient for the Court to sustain the agency’s decision. On major questions, however, the Court insists that Congress clearly express its delegation.

The Court’s decision in West Virginia—applying without extending existing precedents—suggests that this Court has reached the outer limit of its willingness to press changes in its delegation doctrines. The six-justice majority could easily have pressed further if it wished to do so. It did not, however, extend existing doctrine in West Virginia.

Kagan’s dissent really is little more than a formalistic objection to the Court providing a label for the existing line of “Major Questions” cases.

In naming an already existing doctrine but not extending it, the Court created a focal point around existing precedent, effectively ratifying and reifying this point of doctrinal development. Not only did the Court formalize its two-tiered approach for reviewing administrative rule-making decisions, but in only reiterating existing doctrine, West Virginia imbues this two-tiered approach with a focal quality, auguring against delegation doctrine developments beyond this point.

West Virginia v. EPA is a manifestly non-revolutionary decision. First, it concerns “clear statements” of congressional purpose. To wit, if Congress clearly expresses the delegation to an agency, then the Court will still approve the delegation even under the heightened review of the Major Questions doctrine.

Secondly, even if, as an abstract matter, one or more justices remain skeptical of Chevron’s remarkably deferential treatment of agency decisions in the face of statutory ambiguity, as a practical matter the Major Questions Doctrine represents prudential workload management. The two-tiered approach reserves judicial oversight for assertions of congressional delegation on the most important policy questions yet continues Chevron deference on a bevy of more minor delegations that, if subject to challenge under a less-deferential system of judicial review, could otherwise clog the courts.

Finally, the sweeping arguments in Justice Gorsuch’s concurring opinion obscure the modesty of the decision in West Virginia v. EPA. The intended audience for Gorsuch’s concurrence might very well include not only the dissenting justices and their sympathizers, but also critics of administrative delegation who advocate more far-reaching revisions of Chevron and of delegation doctrines more generally.

Smoke but No Fire in the Dissent

While Justice Kagan (joined in dissent by Justices Breyer and Sotomayer) trusses up her objections to the Court’s decision as a doctrinal dispute, Kagan in fact expressly concedes the majority’s main doctrinal point. She objects more to the application of the doctrine in this case rather than to the doctrine itself.

While engaged in a fair bit of rhetorical legerdemain in her opinion, Kagan in fact expressly concedes the Court’s doctrinal claims, albeit she tucks the critical concession away in a parenthetical comment:

The majority . . . contend[s] that in “certain extraordinary cases” . . . courts should start off with “skepticism” that a broad delegation authorizes agency action. The majority labels that view the “major questions doctrine” . . . But the relevant decisions do normal statutory interpretation: In them, the Court simply insisted that the text of a broad delegation, like any other statute, should be read in context, and with a modicum of common sense. Using that ordinary method, the decisions struck down agency actions (even though they plausibly fit within a delegation’s terms) . . . (emphasis added)

Kagan’s parenthetical comment fully concedes the doctrinal point at issue in the case: Under Chevron, a “plausible” reading of a statute in support of an agency rule is all that is necessary to sustain that rule. Yet Kagan concedes that existing decisions “struck down” otherwise textually plausible actions.

Kagan’s dissent really is little more than a formalistic objection to the Court providing a label for the existing line of “Major Questions” cases.

To be sure, Kagan also advances the minor claim of doctrinal innovation regarding whether congressional silence or inaction should be used to guide judicial conclusions regarding legislative purpose. But this is no more than a doctrinal tempest in a teapot.

Kagan is certainly correct that congressional silence is a less probative source of determining congressional purpose than affirmative textual language. But the question is whether inaction can provide any probative evidence for courts to consider.

And here there is a welter of opinions and doctrines in diverse areas of Supreme Court jurisprudence that endorse congressional inaction as relevant evidence for the Court to consider. For example, the Court drew on previous congressional rejections of the authority the president asserted in seizing the steel mills in Youngstown Sheet & Tube Co. v. Sawyer—evidence that the president’s actions were not only unauthorized but opposed by Congress. The Court more broadly, and explicitly, formalized its consideration of congressional inaction in its approach to reviewing executive actions (see, for example, Dames & Moore v. Regan).

Similarly, in its dormant commerce clause jurisprudence, the Court has split over the evidentiary value of failed legislation. In Kassel v. Consolidated Freightways Corp., for example, two of the justices drew on a governor’s veto message to provide evidence of discriminatory intent, and so would apply the “almost per se unconstitutional” test to the legislation at issue. Four of the justices rejected the value of a veto message and so applied the more deferential “balancing” test to the legislation. While judges must treat deductions from legislative inaction with care, it is not the case that inaction never provides any probative evidence to judges for understanding legislative activity.

Where Does West Virginia v. EPA Leave Us?

The Court announced no new doctrine in West Virginia v. EPA. If anything, its labeling of the Major Questions Doctrine, and the doctrinal focal point that labeling provides, signals the Court has reached an outward limit in its willingness to reconsider and revise its delegation doctrines.

At the same time, the dissent misfires on all substantive doctrinal points. While saying otherwise, the dissent nonetheless expressly concedes that earlier cases provide conditions under which traditional Chevron deference does not hold—which is precisely what the majority claims—and the dissent overclaims the Court’s treatment of the evidentiary value of congressional inaction. While the dissent disagrees with how the Court applies the Major Questions Doctrine in this particular case, it does not in fact disagree with the existence of the doctrine itself.

The two-tiered approach to congressional delegation does limit bureaucratic overreach in the most important policy areas. Doing so, it provides incentives for Congress to write clearly—and so to take responsibility—when it wants to delegate major decisions to administrative agencies in the most important policy areas. West Virginia v. EPA only confirms the Court’s commitment to this approach.