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Pallet C e nt ral • S e ptem be r- O ctobe r 2 0 24 17 Donald K. Shandy is an a orney and director at the law firm of Crowe & Dunlevy. He is licensed to prac ce in Texas and Oklahoma, and is admi ed in mul ple federal jurisdic ons, including the U.S. Supreme Court. Don is a Fellow in both the American College of Environmental Lawyers and the American Bar Founda on. His legal prac ce centers on environmental and energy law, and he serves as an advisor to NWPCA. He may be reached at don.shandy@crowedunlevy.com. POLICY AT PLAY CONT. The Demise Of Chevron Deference BY DONALD K. SHANDY I n Loper Bright Enterprises v. Raimondo, the U.S. Supreme Court dealt a fatal blow to the Chevron doctrine, ushering in a new era of regulatory practice. e June opinion, a 6–3 decision, overturned a doctrine that had been a cornerstone of administrative law for 40 years. In doing so, the Court has made it all but certain that Congress will look for more industry input in the legislative process. is opens the door for more engagement opportunities for companies and trade associations, like the National Wooden Pallet & Container Association ("NWPCA"), to impact legislative language. About The Chevron Doctrine In 1984, the Court developed the Chevron doctrine, a two-step process to determine whether an agency applied a reasonable interpretation to an ambiguous statute. First, a court had to determine whether Congress addressed the precise question. If congressional intent was clear on the question, then no deference was warranted, and the court reviewed the challenged regulation against statutory language. However, if the court found the statute was ambiguous, it deferred to the agency's interpretation if it was "based on a permissible construction of the statute." e rationale was that ambiguous statutes implicitly delegate interpretation and policy discretion to agencies. Historically, when granted Chevron deference, the agency enjoyed higher success rates in the courts. Agencies depended on Chevron deference most often when defending immigration and environmental regulations. Sea Change Under Loper Bright Loper Bright overruled the Chevron doctrine and reestablished the requirement that courts independently review an agency's compliance with statutory mandates. In this case, commercial fishermen challenged a regulation that required them to pay a $710 daily cost for at-sea monitoring programs. e Court held that the APA requires reviewing courts to exercise independent judgment when discerning whether an agency's actions exceed its scope of statutory authority. As the final authority on issues of statutory interpretation, it is the responsibility of courts—not agencies—to interpret ambiguous statutory language. Ripple Effect on Regulatory Prac ce e end of Chevron will have far- reaching consequences. Agencies may implement fewer regulations, while companies and trade associations will have greater opportunities to engage with agencies during the regulatory process. In addition, Congress may draft more precise statutory language to convey the express intent to delegate authority to agencies. If they opt to be more prescriptive in their legislative language, Congress will have to be more detailed in its legislation and will look to industry to provide insights through their representatives, like NWPCA, to remove ambiguity while still limiting unintended consequences. e likely near-term impact will be a flood of litigation in lower courts. Such challenges could substantially impact the development of new regulations. e Loper Bright decision indicated that prior cases that relied on Chevron are still good law. However, future decisions may overrule such cases if (1) the reasoning was poor, (2) the decision was unworkable, or (3) the agency's interpretation was not entitled to the deference it previously received.

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