Bills to Approve Deference - Stop Corporate Capture Act (7/26/24)

The Supreme Court rejected Chevron deference based on implied delegated authority from statutory ambiguity or silence as a matter of statutory interpretation of APA 5 U.S.C. § 706. Loper Bright Enterprises v. Raimondo, 603 U. S. ____, 144 S.Ct. 2244 (2024). I covered that development in a prior blog. The Supreme Court Pronounces the Demise of Deference (Federal Tax Procedure Blog 6/29/24; 7/26/24), here. Loper Bright recognizes that, since the demise of deference is a matter of statutory interpretation of APA 5 U.S.C. § 706, Congress may legislatively delegate interpretive authority to agencies (although some read Chief Justice Roberts’ Loper Bright rhetoric as suggesting constitutional overtones). The delegation may be explicit or implicit, but it can’t be by ambiguity or silence alone. I discuss the possibility an implied delegation of interpretive authority in Can § 7805(a) & (b) Be Read as Delegating to Treasury/IRS Interpretive Authority with Deference (7/14/24), here.

Senator Warren has introduced the Stop Corporate Culture Act in the Senate. See Press Release titled Warren Leads Senate Response to End of Chevron Doctrine (7/23/24), here. The Press Release has links at the top to: Bill Text (PDF), Section-by-Section (PDF), and Bill Two-Pager (PDF). 

The Senate “Stop Corporate Culture Act” is the Senate version of a similar House Bill introduced in the House in 2023, Stop Corporate Capture Act, H.R. 1507, 118th Cong., see links to the bill and related material here.

I haven’t compared the two bills, but suspect that there may have been some tweaking in Senator Warren’s version to address specific issues raised by the recent Supreme Court decisions since the introduction of the House bill. However, below, I compare provisions in the two bills on deference and found no differences.

Both bills go substantially beyond the deference issue to address certain administrative law problems raised by decided cases and otherwise in the public discussion. These are suggested by the following from Senator Warren’s description of the bill in the press release:

The Senate version of the Stop Corporate Capture Act would (copy and paste from Senator Warren's Press Release):

Supreme Court NonTax Opinion Applying the Major Questions Doctrine with Sound Bites (7/9/22)

There has been a lot of buzz in the legal community about the Supreme Court's most recent attack on the administrative state in West Virginia v. EPA, 597 U. S. ____, 142 S. Ct. 2587 (6/30/22), SC here, and GS here. The case is not a tax procedure case but deals with fundamental statutory interpretation concepts related to agency rulemaking, which implicates Treasury and IRS rulemaking. The Supreme Court majority deployed what has become known as the "major questions doctrine," naming it for the first time although using the concept was used in cases such as FDA v. Brown & Williamson Tobacco Corp., 529 U. S. 120 (2000) and King v. Burwell, 576 U. S. 473 (2015) (a tax sort of case). 

 The majority opinion was authored by Chief Justice Roberts, joined by 5 other Justices (the conservative Justices, with a concurring opinion by Justice Gorsuch). Chief Justice Roberts frames the issue:

             The Clean Air Act authorizes the Environmental Protection Agency to regulate power plants by setting a "standard of performance" for their emission of certain pollutants into the air. 84 Stat. 1683, 42 U. S. C. §7411(a)(1). That standard may be different for new and existing plants, but in each case it must reflect the "best system of emission reduction" that the Agency has determined to be "adequately demonstrated" for the particular category. §§7411(a)(1), (b)(1), (d). For existing plants, the States then implement that requirement by issuing rules restricting emissions from sources within their borders.

            Since passage of the Act 50 years ago, EPA has exercised this authority by setting performance standards based on measures that would reduce pollution by causing plants to operate more cleanly. In 2015, however, EPA issued a new rule concluding that the "best system of emission reduction" for existing coal-fired power plants included a requirement that such facilities reduce their own production of electricity, or subsidize increased generation by natural gas, wind, or solar sources.

            The question before us is whether this broader conception of EPA's authority is within the power granted to it by the Clean Air Act.

Readers might want to consider Chevron v. NRDC, 467 U.S. 487 (1984) where the Supreme Court applied deference to agency interpretation of the statutory term "stationary source." As readers of this blog surely know, deference to reasonable agency interpretations of ambiguous statutory terms in some cases has been a feature of statutory interpretation since well before the APA in 1946. Chevron just offered a framework for determining when deference to reasonable agency interpretations would apply. 

In WV v EPA, Justice Roberts' majority opinion did not get to the Chevron deference framework because it concluded that the agency interpretation was beyond any delegation Congress could have intended. Basically, the agency interpretation was a leap too far for the majority, who apparently wanted to avoid the Chevron framework. (Because the major questions doctrine is predicate to deploying Chevron, some call this Chevron Step Zero.)