{"id":3386,"date":"2022-08-18T16:00:31","date_gmt":"2022-08-18T20:00:31","guid":{"rendered":"https:\/\/www2.law.temple.edu\/10q\/?p=3386"},"modified":"2022-08-18T16:00:31","modified_gmt":"2022-08-18T20:00:31","slug":"country-road-take-me-where-new-deconstruction-of-the-administrative-state-decision-what-is-a-business-law-practitioner-to-do","status":"publish","type":"post","link":"https:\/\/law.temple.edu\/10q\/country-road-take-me-where-new-deconstruction-of-the-administrative-state-decision-what-is-a-business-law-practitioner-to-do\/","title":{"rendered":"\u2018Country Road, Take Me . . . Where?\u2019 New \u201cDeconstruction of the Administrative State\u201d Decision \u2013 What is a Business Law Practitioner to do?"},"content":{"rendered":"

With the Supreme Court\u2019s decision in WEST VIRGINIA ET AL. v. ENVIRONMENTAL PROTECTION AGENCY ET AL., No. 20-1530 <\/em>(June 30, 2022) rattling the legal world, what does it mean for counsel that represent regulated industries? Is this an earthquake or a tremor?<\/p>\n

First, a quick summary of the case. The issue presented was whether the Environmental Protection Agency has the legal authority to regulate and order the reduction of carbon dioxide emissions \u201coutside the fence\u201d of an individual coal-powered plant.  Although there were several other interesting issues in the case–including the future of Chevron<\/em> and the \u201cnon-delegation\u201d doctrine–the main thing to take away is the newly-minted \u201cmajor question doctrine,\u201d which provides that there must be \u201cclear statutory language\u201d delegating legal authority to the agency on a question that impacts a \u201cmajor sector of the economy\u201d.  Lacking such language, the Court blocked the EPA\u2019s carbon-reduction plan.<\/p>\n

The \u201cmajor question doctrine\u201d has its antecedents in the Brown and Williamson,<\/em> MCI<\/em> and UARG<\/em> cases \u2013 though most observers viewed these cases as statutory interpretation cases, not a new theory of administrative law. But until the recent CDC<\/em> decision on vaccine mandates a few months ago, and other than in certain academic circles, \u201cmajor question\u201d was not the legal test in such cases.<\/p>\n

The exact contours of the doctrine \u2013 and hence the problem for counsel \u2013 are as yet unclear.<\/p>\n

So, if you\u2019re sitting in the law department of a regulated industry, what to make of this case? Certainly, the Supreme Court\u2019s doctrinal result is itself \u201cimportant\u201d and \u201csignificant\u201d and \u201cmajor\u201d. But does the decision open entirely new avenues to challenge agency regulations and significantly \u201creign in\u201d the administrative state? Is it really only about \u201cnew\u201d and \u201csignificant\u201d regulations versus more traditional regulations that have been on the books for many years, or that are more typically within the assumed scope of an agency\u2019s statutory authority?  Quite frankly, no one really knows. No one knows how far the three Justices who form the heart of the plurality decision will go in ruling on any particular case because it is hard to know what they will consider a \u201cmajor question.\u201d  And the test itself is not easily amenable to clear application.<\/p>\n

West Virginia <\/em>joins a number of \u201cmajor\u201d opinions from the newly-constituted Supreme Court\u2019s majority that threaten significant uncertainty when long-relied upon decisions are simply thrown overboard in very rapid and absolute fashion. Businesses, particularly heavily-capitalized, regulated businesses, require years of expected stability in order to comfortably support long-term capital investments and business practices.<\/p>\n

For example, when it comes to carbon emissions, many if not most industry participants have been working toward rapid decreases and transitioning to more renewable and cleaner forms of energy both for regulatory and market-based reasons. However, if the Court has now thrown a life-line to certain sectors of the industry which have been unwilling or unable to adapt, it may well give polluters more time to convert to cleaner forms of energy, putting off the investments needed for longer-term planning for the rest of the industry.<\/p>\n

Given the possibility of competition from foot-dragging last-movers, is it wise to hop on the anti-administrative bandwagon and start challenging all sorts of regulations on the books?  Because many of the recent cases are not just industry-fueled, but are also reflect ideology disconnected from economics, there might be limited control over the legal ecosystem and what might happen to any given set of regulations.  How do we even know a \u201cmajor question\u201d when we see one?  The Court has not really told us.<\/p>\n

Make no mistake about it, the Court has not done most businesses or industries any favors by issuing decisions out of whole-cloth that are more ideologically-based than gradual, incremental and predictable. Those who wonder whether West Virginia <\/em>is \u201cpro-business\u201d may be asking the wrong (\u201cmajor\u201d) question.<\/p>\n

 <\/p>\n

Jonathan M. Broder (LAW \u201983) is a retired Vice President of Corporate Development and General Counsel for Conrail. He managed Conrail\u2019s legal and corporate affairs, as well as its real estate and business development departments. Jon is currently a Temple 10-Q Editor and an Adjunct Professor at the Temple University Beasley School of Law.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Professor Jonathan Broder assesses the impact of the recent SCOTUS decision against the Environmental Protection Agency on the power of administrative agencies over regulated industries.<\/p>\n","protected":false},"author":33,"featured_media":3387,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[12,13,8,38],"tags":[2492,2344,2493,2494,2495,2496,373,395,221],"coauthors":[63],"class_list":["post-3386","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-alumni-authored","category-business-law-practice","category-faculty-authored","category-regulated-industries","tag-administrative-law","tag-business-law-practice","tag-carbon-emissions","tag-environmental-protection-agency","tag-major-question-doctrine","tag-regulated-industries","tag-regulations","tag-scotus","tag-u-s-supreme-court","masonry-post","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"yoast_head":"\n\u2018Country Road, Take Me . . . 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