In Kisor v. Wilkie, 588 U.S. __ (2019), a five Justice majority substantially narrowed, but did not wholly overturn, the embattled doctrines arising from Auer v. Robbins, 519 U.S. 452 (1997), and Bowles v. Seminole Rock & Sand Co., 325 U. S. 410 (1945). Under the Auer deference doctrine, courts must defer to reasonable agency interpretations of their own regulations. Several Justices and prominent scholars had criticized Auer deference on statutory, constitutional, and practical grounds. While Auer deference lives on after Kisor, the continuing practical relevance of the doctrine is doubtful for most cases. Further, Kisor’s limitations on Auer deference may portend a similar fate for Chevron deference, in future cases.
Kisor involved a dispute over the meaning of a regulation issued by the Department of Veterans Affairs (VA), where the VA had denied medical benefits based upon a contested understanding of a VA regulation. The Federal Circuit had ruled in the VA’s favor by relying upon Auer deference.
In a majority opinion, written by Justice Kagan, the Court remanded to the Federal Circuit, while spelling out stringent limitations on Auer deference. In particular, the Court articulated five thresholds that an agency must overcome to benefit from Auer deference. These thresholds address some of the most common critiques of courts’ application of this doctrine. First, the court must use traditional tools of construction to decide if the regulation is truly ambiguous. The Court stressed that this should be a particularly exacting inquiry. Second, the agency’s interpretation must, in fact, be reasonable and that “[t]his is a requirement that an agency can fail.” Third, the agency’s interpretation must be its authoritative, official position; it must be expressed by agency head or certain other senior officials, not lower-level personnel. Fourth, the interpretation must express the agency’s substantive expertise. Finally, the interpretation must account for reliance interests and not unfairly surprise regulated parties.
After Kisor, Auer deference doctrine survives, but in a far narrower form than litigants and agencies had become accustomed to. Only formal documents, coming from senior officials, relying upon agency expertise, and—most importantly—offering reasonable interpretation of genuine ambiguity need apply. Much of the action in most cases will take place at the first threshold, and litigants will generally focus on making competing arguments under traditional interpretive tools, to argue that the regulation either means what the agency claims or what the challenger claims, without need to resort to deference.
Kisor also has possible, important implications for Chevron deference, which sets out a two-step framework for when courts must defer to certain agency interpretations of statutes. In his separate opinion in Kisor, Chief Justice Roberts stressed that he did not consider the opinion to “touch upon” Chevron. But the first step in the Chevron framework is whether, in fact, a statute is truly ambiguous, after applying all canons of statutory construction, and genuine ambiguity is the first and most critical threshold for Auer deference under Kisor. Further, the second step in Chevron deference is that the agency interpretation must be reasonable, and that is the second Kisor threshold, which the Court also stressed. And whether an agency is exercising genuine, technical expertise can also play into the Chevron analysis, as it does under Kisor. It may well be that future efforts to narrow Chevron deference will follow the Kisor blueprint of seriously confining the doctrine’s reach, including putting renewed emphasis on using traditional canons of statutory construction to limit the scope of what statutes are considered genuinely ambiguous. That approach could appeal to a Supreme Court that has been careful about not overturning too many of its prior precedent, while also wanting to take careful steps to address areas where application of those precedents has led to negative doctrinal and practical results.
Finally, it is important to note that deference to agencies, writ large—whether under Auer or Chevron—can be a complicated one for regulated parties. When a regulated party opposes the agency’s position, it would generally oppose arguments in favor of deference. When, the party agrees with the agency’s position, it generally wants the court to defer. In light of Kisor, however, it may wise to avoid focusing too much on concerns over deference in briefing and argument in court. Litigants and agencies who devote overmuch attention to deference, one way or another, may find a less interested audience in many courts, who will be more focused on using traditional canons of textual interpretation in order to avoid any concerns about resolving claimed ambiguity with deference doctrines.