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House Advances Bill to Overturn Court Ruling on Deference to Regulatory Agencies

Friday, June 10, 2016
Sandler, Travis & Rosenberg Trade Report

A 1984 Supreme Court ruling allowing courts to defer to regulatory agencies’ interpretations of ambiguous federal laws would be overturned under a bill approved June 8 by the House Judiciary Committee.

In Chevron U.S.A., Inc. v. Natural Resources Defense Council the Supreme Court held that if a law passed by Congress is silent or ambiguous with respect to a particular issue, the courts should defer to a reasonable interpretation (i.e., one that is not arbitrary, capricious or manifestly contrary to the statute) by the agency responsible for enforcement. This principle has been extensively utilized since that time, including in customs and trade litigation.

Judiciary Committee Chairman Bob Goodlatte, R-Va., said that under this ruling federal courts “have rarely questioned federal regulatory agencies’ interpretations of the statutes passed by Congress,” which “has emboldened federal bureaucrats to overreach” and turned the U.S. “into a runaway regulatory state.” In response, said bill sponsor Rep. John Ratcliffe, R-Texas, the Separation of Powers Restoration Act (H.R. 4768) would require federal courts to conduct a “de novo” (new) review of all relevant questions of law “rather than leaving such interpretation up to federal bureaucrats.”

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