In West Virginia v. EPA (June 30, 2022), the Supreme Court ruled In a 6–3 decision that Congress did not grant the EPA the authority to create emission caps. In doing so the Court skirted the long held policy of courts deferring to administrative agencies interpreting their own rules, regulations and implementing statutes. Under the so called Chevron Deference approach in situations where the agency’s interpretation is reasonable the agency is accorded the “benefit of the doubt”. Instead the Court relied upon the “ Major Questions Doctrine” to limit the reach of EPA’s authority. The major questions doctrine holds that courts should not defer to an agency’s interpretation where questions of “vast economic or political significance” are at issue, even if the agency’s interpretation is reasonable under the statute or regulations.
Going forward the application of the major questions doctrine is likely to be asserted as a means to limit the scope of Chevron Deference, and in turn set boundaries on the reach of administrative agencies.
The Court was clear that significant agency decisions must have “more than a merely plausible textual basis for the agency action” and “must point to clear congressional (or state legislative) authorization for the power it claims.”