This is the third edition of Trends’ Supreme Court preview, a summary of environmental, energy, and natural resources cases to be decided by the U.S. Supreme Court in its upcoming session (October 2023 Term). We focus on one case with potentially profound implications on agency discretion to interpret their statutory authorities: Loper Bright Enterprises v. Raimondo.
Magnuson-Stevens Act: Chevron deference
This case concerns a challenge by the petitioners to the authority of the National Marine Fisheries Service (NMFS) under the Magnuson-Stevens Act (MSA) to require operators of domestic fishing vessels to pay the salaries of federal observers that are carried on board their vessels to observe compliance with NMFS regulations. While the MSA does expressly require vessels to pay the salaries of federal monitors in three narrow circumstances, the statute caps those salaries at 2 to 3 percent of the value of the vessel’s catch. Petitioners unsuccessfully appealed the NMFS’ requirement in fisheries management plans for vessels to pay federal observers' salaries in circumstances not expressly authorized by the MSA and without the protections of the statutory cap on those salaries.
A divided panel of the U.S. Court of Appeals for the District of Columbia (D.C. Circuit) upheld the District Court’s grant of summary judgment to NMFS upholding NMFS’ interpretation of its authority to require vessels to pay federal observer salaries on the basis of Chevron deference. Loper Bright Enters. v. Raimondo, 45 F.4th 359 (D.C. Cir. 2022). The D.C. Circuit majority interpreted the MSA’s silence as “ambiguity,” allowing the application of Chevron’s two-step analysis, which, briefly stated, addresses two questions: 1. Is a statute ambiguous? 2. If so, is the agency's interpretation of the statute reasonable? See Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984). The question on which certiorari was granted is whether the Court should overrule Chevron or at least clarify that statutory silence concerning controversial powers expressly but narrowly granted elsewhere in the statute does not constitute an ambiguity requiring deference to the agency.
The petitioners are four family-owned and family-operated companies that regularly participate in the Atlantic herring fishery. The MSA does not expressly authorize the requirement that domestic vessels in the Atlantic herring fishery pay the salaries of federal observers, although the parties agreed that the MSA clearly obligates the observers to be “carry[ied]” and “quarter[ed]” on board their vessels as required in applicable fishery management plans. 16 U.S.C. § 1853(b)(8). They argue, as Judge Walker did in his dissent from the majority opinion of the D.C. Circuit, that by only authorizing the payment of federal observer salaries by vessels in narrow circumstances not applicable to the Atlantic herring fishery, Congress withheld authorization to impose such an obligation on them via regulation, i.e., via the promulgation of fishery management plans under the MSA.
The Respondents Department of Commerce, NMFS et al., argue that the D.C. Circuit majority was wrong in proceeding to step two of its Chevron analysis, instead agreeing with the District Court that the MSA unambiguously authorizes the imposition of salary payment obligations on domestic vessels via fishery management plan revisions, allowing the Chevron analysis to stop at step one. In the alternative, assuming ambiguity is found in step one—as held by the D.C. Circuit—respondents further argue that the terms “carry” and “quarter” included in the MSA’s unambiguous requirement to take federal observers aboard should be read to include the requirement to also pay the salaries of those observers carried and quartered on a domestic fishing vessel. They also argue that, because fishery management plans are required by the MSA to “contain the conservation and management measures . . . necessary and appropriate for the conservation and management of the fishery . . . ,” see 16 U.S.C. §§ 1853(a)(1)(A) and (b)(14), the MSA clearly authorizes the management plan’s requirement for vessels to pay federal observers’ salaries.
In reply, petitioners note that one of the few practical constraints that protect the governed from overregulation is the need for Congress to appropriate sufficient funds to enforce our burgeoning regulations. But here, they argue that to allow NMFS to force the regulated to foot the bill for government inspectors without express authorization or appropriations from Congress would eviscerate that “vital practical constraint,” according to petitioners. And whereas silence or ambiguity on the details of regulation may be resolved through application of Chevron’s two-step analysis, petitioners argue that where the silence at issue is in the context of other express statutory provisions narrowly allowing the imposition of a payment obligation, in that context such silence should not be deemed an ambiguity, but rather a deliberate withholding of statutory authority to impose such an obligation.
On October 13, 2023, in Case No. 22-1219, the Supreme Court agreed to consolidate Loper Bright with the case of the owners of two other fishing vessels, the Huntress and the Relentless, challenging the same regulations, wherein both the district court and the First Circuit Court of Appeals upheld the challenged regulations on Chevron grounds, referencing the Loper Bright decision. The First Circuit’s opinion is reported at Relentless, Inc. et al. v. United States Dep’t of Commerce, 62 F.4th 621 (1st Cir 2023).
Oral argument in this case has yet to be scheduled as of the time of Trends publication.