On June 28, 2024, the Supreme Court of the United States (Supreme Court) issued a decision in Loper Bright Enterprises, et al. v. Raimondo, Secretary of Commerce, et al., No. 22-451, 2024 U.S. LEXIS 2882 (Loper Bright), overturning the doctrine established by its prior decision in Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984) (Chevron).
Chevron and Loper
The Chevron doctrine directed courts to defer to certain instances of a federal agency’s statutory interpretation if the statute at issue is ambiguous and the agency’s interpretation was reasonable. Chevron deference could not, however, be invoked for every instance in which a federal agency interpreted the law. Instead, courts would consider whether to apply Chevron only when an agency interpretation was issued in the exercise of its authority to act with the force of law. Specifically, the Chevron test would be applied “when (1) ‘it appears that Congress delegated authority to the agency generally to make rules carrying the force of law’ and (2) ‘the agency interpretation claiming deference was promulgated in the exercise of that authority.’ ” Price v. Stevedoring Servs. of Am., 697 F.3d 820, 826 (9th Cir. 2012) (en banc) (quoting United States v. Mead Corp., 533 U.S. 218, 226-27 (2001).) If this first threshold was met, a court would apply the Chevron test. If not, courts would instead apply the factors outlined in Skidmore v. Swift & Co., 323 U.S. 134 (1944) (Skidmore) to determine whether to defer to the agency’s statutory interpretation.
In Loper Bright, the Supreme Court overruled Chevron, holding that:
Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority, as the [Administrative Procedure Act (APA)] requires. Careful attention to the judgment of the Executive Branch may help inform that inquiry. And when a particular statute delegates authority to an agency consistent with constitutional limits, courts must respect the delegation, while ensuring that the agency acts within it. But courts need not and under the APA may not defer to an agency interpretation of the law simply because a statute is ambiguous.
Loper Bright, 2024 LEXIS 2882, at 61-62. However, it did not disturb Skidmore in so doing, under which “ ‘the interpretations and opinions’ of the relevant agency, ‘made in pursuance of official duty’ and ‘based upon … specialized experience,’ ‘constitute[d] a body of experience and informed judgment to which courts and litigations [could] properly resort for guidance,’ even on legal questions.” Loper Bright, 2024 LEXIS 2882, at p. 28, citing Skidmore, 323 U.S., at pp. 139-40. Agency interpretations of law are therefore still entitled to Skidmore deference.
Judicial Deference to Agency Scientific Determinations
Deference to federal agencies is not limited to instances of statutory interpretation; case law has long recognized an agency’s discretion with respect to scientific determinations separate from and unrelated to the Chevron doctrine or Skidmore. Specifically, the Supreme Court has repeatedly recognized that the resolution of issues “requiring a high level of technical expertise … is properly left to the informed discretion of responsible federal agencies.” See Kleppe v. Sierra Club, 427 U.S. 390, 412 (1976). Courts review such “matters within the expertise of an agency” to determine whether the agency’s action was arbitrary, capricious, or otherwise not in accordance with the law. San Luis & Delta Mendota Water Authority v. Jewell, 747 F.3d 581, 592 (9th Cir. 2014). While federal agencies are required to “employ ‘the best scientific and commercial data available,’ ” they are “ ‘not required to support [their] finding[s] … with anything approaching scientific certainty … .’ ” Id. Moreover, “[w]hen examining this kind of scientific determination…a reviewing court must generally be at its most deferential.’ ” Id. at 592-93 (citation omitted). Deference is greatest when the agency choses between scientific models, and courts “must respect the agency’s judgment even ‘in the face of uncertainty.’ ” Id., at 610, 633 (citation omitted). The Supreme Court has also held that the APA gives substantial discretion to an agency to rely on the reasonable opinion of its own qualified experts – even if a court finds contrary views more persuasive. The Supreme Court’s ruling in Loper Bright does not disturb this principle.
The survival of deference to scientific determinations is especially significant in the context of the anticipated biological opinions on Central Valley Project operations, which largely involve scientific determinations and complex modeling. Additionally, courts may defer to agencies with respect to their operational decisions without reliance on Chevron. In one case considering the Bureau of Reclamation’s interim operating plan for the Klamath Project during consecutive drought years, the Oregon District Court noted that Reclamation “is better equipped to serve the public interest than a judge with a law degree.” Klamath Tribes v. U.S. Bureau of Reclamation, 537 F.Supp.3d 1183, 1185 (D. Or. 2021). The Supreme Court’s decision in Loper Bright has no bearing on courts’ ability to grant such deference in the case of daily operations of a complex reclamation project.
California State Agency Discretion
Neither Chevron nor Loper Bright impact litigation challenging California agency action. California courts have not applied the Chevron doctrine to issues of California administrative agency discretion in interpreting state law. Instead, when considering agency interpretations of state law (quasi-legislative rules), the court considers “two broad categories of factors.” First, “those ‘indicating that the agency has a comparative interpretative advantage over the courts,’ ” and second, “those ‘indicating that the interpretation in question is probably correct.’ ” Yamaha Corp. of America v. State Bd. of Equalization, 19 Cal.4th 1, 12 (1998) (Yamaha).
Critically, in deciding Yamaha, the California Supreme Court cited Skidmore – not Chevron – which is left undisturbed by the Supreme Court’s majority opinion in Loper Bright, allowing that courts may continue to “seek aid” from responsible agencies’ interpretations of statute as part of their exercise of independent judgment. Given California case law’s reliance on Skidmore, and provision for a method of reviewing agencies’ statutory interpretation that is distinct from that established by Chevron, Loper Bright is not likely to impact judicial review of California agencies’ interpretations of state law. Much of the litigation involving California water rights and water quality matters takes place in state courts, challenging State Water Resources Control Board or Regional Water Quality Control Board actions, and the Supreme Court’s ruling in Loper Bright will not significantly impact water cases litigated in state court.
Finally, many major water supply projects and permitting actions within the state are subject to extensive litigation under the California Environmental Quality Act (CEQA), with serious implications for both state and local agencies and stakeholders. Loper Bright will have no bearing on state court review of California agency actions that must comply with CEQA, as actions taken under CEQA are reviewed under their own separate standard of review.
In sum, Loper Bright overturned a seminal decision that has been implemented in federal courts for decades. However, other forms of judicial deference and applicable legal standards will continue to apply, especially in the legal contexts that most affect water users.
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