Justices to Weigh Deference to Federal Agencies’ Own Rules Interpretations

By Mark Walsh — December 10, 2018 4 min read
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The U.S. Supreme Court agreed on Monday to take up a case raising an important question about when courts should defer to a federal agency’s interpretation of its own ambiguous regulations—an issue that has arisen in a number of education cases.

In granting review in Kisor v. O’Rourke (Case No. 18-15), which involves a military veteran’s challenge to a Department of Veterans Affairs interpretation of its regulations on benefits, the justices will take up a thorny question of administrative law that they were poised to address just two terms ago in the case of a transgender student who was born female but sought to use the boys’ restroom at his high school.

That case involved President Barack Obama administration’s interpretation of a Department of Education Title IX regulation to mean that schools must allow transgender students to use restrooms and lockers rooms consistent with their gender identity.

A federal appeals court had sided with the transgender student, Gavin Grimm, and the Obama administration by ruling that the Education Department’s informal guidance about its 1975 formal regulation stemming from Title IX of the Education Amendments of 1972 was owed deference.

Title IX bars sex discrimination in federally funded schools, and the 1975 regulation had merely made clear that schools could maintain separate restrooms for boys and girls. The Obama administration issued informal guidance in 2016 that asserted that discrimination and harassment based on gender identity and sex stereotypes were covered by Title IX.

The U.S. Court of Appeals for the 4th Circuit applied what is known in administrative law as “Auer deference,” based on a 1997 U.S. Supreme Court decision known as Auer v. Robbins, and upheld the Obama administration’s interpretation.

Auer requires that an agency’s interpretation of its own ambiguous regulation be given controlling weight unless the interpretation is plainly erroneous or inconsistent with the regulation or statute,” said the 4th Circuit court panel in the decision known as G.G. v. Gloucester County School Board. “Agency interpretations need not be well-settled or longstanding to be entitled to deference. They must, however, reflect the agency’s fair and considered judgment on the matter in question.”

The Supreme Court granted review of that decision in the fall of 2016 and scheduled arguments in early 2017. But in the meantime, Donald Trump won the White House, and his administration withdrew the informal Obama administration guidance that said schools must allow transgender students to use gender-aligned school restrooms and locker rooms. The justices then dismissed the appeal and sent Grimm’s case back to the lower courts, where it is proceeding on the separate questions of whether Title IX itself or the 14th Amendment’s equal-protection clause protect transgender students.

Questioning ‘Auer’ Deference

In the meantime, a number of justices have questioned the validity of court deference to agency interpretations of their own ambiguous regulations, which is based on not only the 1997 Auer decision but a 1945 Supreme Court ruling, Bowles v. Seminole Rock & Sand Co.

Seminole Rock deference is constitutionally suspect” and “on its last gasp,” Justice Clarence Thomas wrote in a dissent last term when the Supreme Court declined to take up the issue in a case involving defense contracting. Thomas tends to refer to the older precedent when discussing Auer/Seminole Rock deference.

The Auer/Seminole standard of deference “undermines the judicial ‘check’ on the political branches by ceding the courts’ authority to independently interpret and apply legal texts,” Thomas wrote earlier this year. “And it results in an accumulation of governmental powers by allowing the same agency that promulgated a regulation to change the meaning of that regulation at its discretion. This court has never put forward a persuasive justification for Seminole Rock deference.”

Thomas was joined in the dissent from denial of review by Justice Neil M. Gorsuch, and Thomas asserted that, among current members of the court, Chief Justice John G. Roberts Jr. and Samuel A. Alito Jr. have also questioned the vitality of the concept.

Even the author of the Auer decision, Justice Antonin Scalia, had “come to doubt its correctness,” Thomas observed.

Scalia wrote in a concurrence in a 2013 case about environmental regulations that “for decades, and for no good reason, we have been giving agencies the authority to say what their rules mean, under the harmless-sounding banner of deferring to an agency’s interpretation of its own regulations.”

In the new case, the court accepted the appeal of James L. Kisor, a Vietnam veteran whose long pursuit of claims for post-traumatic stress disorder led to a challenge of a Veterans Affairs department interpretation of one of its relevant regulations, with lower federal courts giving Auer deference to the department’s interpretation.

A friend-of-the-court brief filed by 19 states cited the Obama administration’s Title IX interpretation, arguing that Auer deference “requires courts to defer to an agency’s after-the-fact views of [spending clause] conditions—views the assenting states never could have known.”

The Trump administration, in a brief for the Veterans Affairs department, said it agreed that “the question is an important one that may warrant this court’s review in an appropriate case.”

But the veteran’s case was not the appropriate vehicle because his benefits decision did not truly rely on court deference to the agency’s interpretation, the brief said.

The justices cast aside that argument in granting review of the case, which will be argued sometime early next year and likely decided by late June.

A version of this news article first appeared in The School Law Blog.