Admin Law Ain’t Boring Anymore—What You Need to Know about Last Week’s Supreme Court Cases

Administrative law has long had a reputation for boredom. But three blockbuster cases out of the Supreme Court last week have changed that. Each case is its own game changer, but together, the three cases are a sea change in an area of law typically known for consistency.  

Three things you need to know:

1. In Ohio v. EPA, the Supreme Court stayed the EPA’s enforcement of a federal clean air plan covering more than 20 states. The Court held that the agency’s action violated the federal Administrative Procedure Act because the EPA “offered no reasoned response” to a comment submitted under the notice and comment process. 
2. In SEC v. Jarkesy, the Supreme Court held that the 7th Amendment entitles a defendant to a federal civil jury trial in an agency enforcement action seeking civil penalties for securities fraud. The Supreme Court invalidated an agency enforcement action that “concentrate[d] the roles of prosecutor, judge, and jury in the hands of the Executive Branch.” 
3. In Loper Bright Enterprises v. Raimondo, the Supreme Court overruled Chevron v. Natural Resources Defense Council. The Court held that “[c]ourts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority, as the [federal Administrative Procedure Act] requires.” 

Together, these three cases demonstrate the Supreme Court’s pivot away from administrative agency authority and expertise, transferring that power to the judicial system instead.

Three things to expect going forward:

1. Application in federal courts: First, expect federal courts to discount agency arguments and expertise in favor of challenges to agency actions, especially when the challenger frames the issue as one of statutory interpretation. Second, expect even tougher scrutiny over how an agency answered a comment submitted in the notice and comment process. Third, expect federal courts to invalidate more civil enforcement schemes when an administrative agency seeks civil penalties.
2. Confusion in state courts: State courts will need to decide if Ohio v. EPA and Loper Bright apply to state law versions of the Administrative Procedure Act. State courts will also need to decide if their state constitutional rights to civil jury trials invalidate administrative proceedings seeking civil penalties. These open questions have huge implications for state law administrative regimes like workers’ compensation, wage and hour disputes, occupational safety and health and dozens of other state administrative law regimes where civil penalties are available.
3. Need for comprehensive litigation strategy for every administrative case: Clients need a comprehensive strategy from the very beginning of every federal and state administrative case to ensure the proper challenges to agency authority and decision making are raised throughout the administrative case and in the court case.

These three cases are a vast departure from the old administrative law. Consult your Dinsmore attorney for advice on these state-specific nuances and crafting the comprehensive strategy needed at the beginning of every administrative case.