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Supreme Court decision keeps 'Auer deference,' which strengthens power of government regulators

Key Points
  • The Supreme Court on Wednesday refused to overturn a precedent that strengthened the power of government regulators in a closely watched case that could have broad ramifications for federal agencies. 
  • The precedent is known as "Auer deference," after the 1997 case Auer v. Robbins. Since Auer, the Supreme Court has held that courts should defer to agencies' interpretations of their own rules if those rules are ambiguous.
  • "Auer deference retains an important role in construing agency regulations," wrote Justice Elena Kagan, who delivered the opinion of the court. "But even as we uphold it, we reinforce its limits." 
The U.S. Supreme Court building stands in Washington, D.C., on Tuesday, Jan. 22, 2019.
Al Drago | Bloomberg | Getty Images

The Supreme Court on Wednesday refused to overturn a precedent that strengthens the power of government regulators in a closely watched case that could have broad ramifications for federal agencies.

The precedent is known as "Auer deference," after the 1997 case Auer v. Robbins. Since Auer, the Supreme Court has held that courts should defer to agencies' interpretations of their own rules if those rules are ambiguous.

Though the top court retained the precedent, it did so while imposing limitations. And, in light of those limitations, the court vacated a federal appeals court ruling against a Marine veteran who claimed to have been harmed by Auer, and ordered the appeals court to reconsider the case.

"Auer deference retains an important role in construing agency regulations," wrote Justice Elena Kagan, who delivered the opinion of the court. "But even as we uphold it, we reinforce its limits."

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Kagan relied heavily on the legal principle of "stare decisis," which puts a high bar on decisions that reverse the court's past rulings. She suggested that because of Auer's broad reach, a reversal could be particularly grievous: "It is the rare overruling that introduces so much instability into so many areas of law, all in one blow," she wrote.

But the court's conservatives, who concurred with Kagan's judgment but signed onto separate opinions explaining their reasoning, suggested Auer was unwise. Justice Neil Gorsuch, who has been skeptical of Auer, wrote in a concurring opinion that while the rule stands, "the doctrine emerges maimed and enfeebled—in truth, zombified."

Chief Justice John Roberts signed onto parts of Kagan's majority opinion as its fifth vote. Roberts also wrote a separate, concurring opinion in which he suggested that the distance between Kagan and Gorsuch is "not as great as it may initially appear."

Read more: This case has united business, labor and immigration groups. But some see a right wing attack on government regulation

Kagan emphasized that in order for a government agency's interpretation to be valid, the interpretation must be reasonable, authoritative and based on expertise. Roberts wrote that those limitations are essentially the same as those Gorsuch suggested, though Gorsuch wrote that a judge, and not the agency, should have more authority to make the final call.

"Formally rejecting Auer would have been a more direct approach," Justice Brett Kavanaugh wrote in a concurring opinion. But, he wrote that the limitations Kagan noted "should lead in most cases to the same general destination."

The court's decision to retain Auer in part because it is a settled precedent is significant for reasons beyond agency deference.

The justices have sparred over the significance of precedent this term. The issue has taken on a heightened focus thanks to the court's new reliable conservative majority following the confirmation of Kavanaugh, Trump's second nominee to the top court.

Liberal court observers have expressed concern that the court could reverse one precedent in particular: The landmark 1973 ruling Roe v. Wade, which outlawed state abortion bans. Both Kavanaugh and Gorsuch, Trump's first pick, have said they view Roe as settled.

Marine veteran sought disability payments dating back to 1980s

The facts of the case involved a Marine veteran, James Kisor, who argued that the Department of Veterans Affairs owes him retroactive disability payments dating back to the 1980s to cover treatments for post-traumatic stress disorder he developed from involvement in particularly gruesome fighting in Vietnam.

Veterans Affairs argued that under its regulations it is only required to provide benefits to Kisor dating back to 2006. A federal appeals court considered that interpretation binding under Auer, and ruled against Kisor.

The top court vacated the appeals' court ruling, with Kagan noting that the court "assumed too fast that Auer deference should apply."

In a statement, Kisor's attorney Paul Hughes said the ruling was a "significant victory," despite the court's retention of Auer.

"Today's decision will significantly narrow agency authority," Hughes wrote.

Kisor had argued that the top court should overturn Auer, saying that it gives government bureaucrats too much power.

That argument united an unusual coalition of business, labor and immigrant rights groups, who all wrote briefs urging the justices to disavow Auer.

Despite that unity, some academics and Democratic lawmakers viewed the case as part of a larger strategy orchestrated by conservative legal minds to pare back power of regulators.

"This case comes before the Court as part of a larger strategy to disable public interest regulation," Sen. Sheldon Whitehouse of Rhode Island wrote in a brief filed with the top court.

The case is formally known as Kisor v. Wilkie, No. 18-15.