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In Loper Bright Enterprises v. Raimondo, the Court overturned 40 years of precedent by deeming Chevron deference inconsistent with the Administrative Procedures Act (APA). This decision removes the deference granted to federal agencies in interpreting and applying federal law when Congress passes unclear legislation, potentially leading to increased challenges to existing regulatory programs.
"The Loper decision marks a significant shift in the balance of power between the judiciary and executive branches," said Kim Logue, associate vice president at J.S. Held. "Businesses should be aware of the potential for increased litigation and the need to reevaluate their regulatory compliance strategies."
The Court followed the Loper decision with another blow to agency authority in Corner Post v. Board of Governors of the Federal Reserve System, holding that the clock starts for filing lawsuits when a regulation first affects a business, rather than when the regulation is adopted. This decision expands the timeframe for companies to challenge administrative regulations.
John Peiserich, Esq., the executive vice president and Environmental, Health & Safety Practice leader at J.S. Held, noted, "The Corner Post decision, in conjunction with Loper, creates a new landscape for businesses to challenge regulations that may have been in place for years. Companies should assess their regulatory exposure and consider the potential implications of these decisions on their operations."
The Loper and Corner Post decisions have key implications for businesses:
- Reduced procedural bars to challenge the way that agencies interpret and apply federal law
- Heightened uncertainty regarding the validity of existing agency regulations
- Underscored need to educate legislators on important issues by demanding that Congress provide greater clarity and specificity in federal statutes
"The Supreme Court's decision to overturn Chevron deference could disrupt both traditional and renewable energy value chains potentially delaying project approvals, and creating a less predictable investment environment, which might hinder the innovation, development and deployment of energy infrastructure and technologies," said Andrea Korney, the vice president of Sustainability for J.S. Held's ESG & EHS Digital Solutions group and Advisor on the Equity of Energy Committee for the U.S. Department of Energy.
Dr. Alan Marco, former chief economist at the U.S. Patent and Trademark Office, emphasized the impact of the rulings. "Regulatory and legal uncertainty can have major impacts on the value of tangible and intangible assets, and can complicate business transactions. The best way to understand how regulatory uncertainty will impact a particular business is through solid data and analysis. Unfortunately, that takes time." Dr. Marco continues, "In the meantime, there is no substitute for the experience of experts who have seen regulations change across multiple industries in multiple regulatory contexts. Companies can benefit from the guidance of experienced professionals, such as legal practitioners and former federal agency employees, who possess unique insights into the regulatory landscape and can help inform critical decision-making."
Read the full article: https://www.jsheld.com/insights/articles/crosscurrents-companies-face-regulatory-uncertainties-in-wake-of-scotus-decisions.
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Note: The quotes from Andrea Korney and Dr. Alan Marco are those of the author and do not represent the views of any federal agency.
About J.S. Held
J.S. Held is a global consulting firm that combines technical, scientific, financial, and strategic expertise to advise clients seeking to realize value and mitigate risk. Our professionals serve as trusted advisors to organizations facing high stakes matters demanding urgent attention, staunch integrity, proven experience, clear-cut analysis, and an understanding of both tangible and intangible assets. The firm provides a comprehensive suite of services, products, and data that enable clients to navigate complex, contentious, and often catastrophic situations.
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