Supreme Court Takes Yet Another Case That Could Limit Agency Powers

U.S. Supreme Court. (Source: Shutterstock)

If you think that regulatory agencies have too much power in interpreting laws, then you will be happy about what I am about to tell you. On Monday, the Supreme Court decided to hear a case next year that could dramatically limit an agency’s flexibility to interpret statutes. Between this and the Court’s decision to examine the constitutionality of the CFPB’s funding mechanism, next year is shaping up as one of the most important for credit unions to follow the Supreme Court in years.

In 1984, the Supreme Court decided Chevron USA Inc. v. Natural Resources Defense Council, Inc, in which it determined how much deference agencies should be given when interpreting and implementing ambiguous statutes. Under this framework, when a regulation is challenged, the Court must first determine whether the statute it’s interpreting is ambiguous. If so, the Court is “obligated to accept” the agency’s position so long as its interpretation is reasonable.