Loper Surfaces in FCC v. Consumers’ Research—A Nondelegation Challenge to the Universal Service Fund

This past Term, the Supreme Court cited Loper Bright in several statutory interpretation decisions, including Seven County Infrastructure Coalition v. Eagle County, Bondi v. VanDerStock, McLaughlin Chiropractic Assocs., Inc. v. McKesson Corp., and City and County of San Francisco v. EPA. Loper Bright surfaced again on the last day of the Term in FCC v. Consumers’ Research, a case involving a nondelegation and private nondelegation challenge to the Universal Service Fund—a telecommunications social welfare program funded by a charge set by unelected administrators at the FCC (who, in turn, punted that task to a private corporation made up of self-interested industry insiders).

Consumers’ Research presented the Court with an opportunity to reinvigorate the nondelegation doctrine by enforcing Article I’s bar against Congress transferring its exclusive legislative power to other entities. The Court did not take that path. Instead, in a 6­–3 decision, the Court declined to revisit the “intelligible principle” regime, rejecting Consumers’ Research’s nondelegation and private nondelegation challenges, as well as the Fifth Circuit’s “combination theory” of unconstitutionality.

Justice Kagan’s and Kavanaugh on Loper

Writing for the six-Justice majority, Justice Kagan cited Loper Bright in the course of construing the statute to grant the FCC far more limited powers than under the dissent’s (and Fifth Circuit’s) interpretation—a move that diminishes constitutional concerns. Justice Kagan suggested that at oral argument the Solicitor General had taken the position that the statute imposed certain limits on the agency’s powers but emphasized, quoting Loper Bright, that “[i]n any event, and yet more important, we must ‘exercise [our] independent judgment in deciding’ what power Congress has conferred”—a key overarching point of Loper Bright. In a footnote, the dissent echoed this core point in Loper Bright but parted ways on its application in this case to the Solicitor’s statements.

Justice Kavanaugh’s solo concurrence also cites Loper Bright, offering some insight into its broader significance and impact. As Professor Josh Blackman has observed, Justice Kavanaugh’sthoughtful Consumers’ Research concurrence is interesting for a number of reasons. Justice Kavanaugh suggests that, in his view, “[m]any broader structural concerns about expansive delegations” of power by Congress to the Executive branch “have been substantially mitigated” by the Supreme “Court’s rejection of so-called Chevron deference” in Loper Bright, as well as the Court’s use of the “major questions canon.” And citing passages in Loper discussing courts’ duty under the Administrative Procedure Act to independently interpret statutes and role in policing delegations of discretion to the Executive, Justice Kavanaugh notes that while intelligible-principle test doesn’t do much to stop Congress from delegating power to the Executive, “the President’s actions when implementing legislation are constrained—namely, by the scope of Congress’s authorization and by any restrictions set forth in that statutory text.” Justice Kavanaugh also suggested that broad delegations to “independent” agencies raise greater constitutional concerns, to the extent those administrative bodies can constitutionally exist.

Will Consumers Research “Stand the Test of Time?”

In his dissent in Consumers’ Research, Justice Gorsuch, joined by Justices Thomas and Alito, cites his concurring opinion in Loper Bright, which gives a thoughtful, scholarly exposition of his views on stare decisis and why courts shouldn’t overread stray remarks and dicta as holdings. Justice Gorsuch wrote that “things could be worse. Because today’s misadventure ‘sits unmoored from surrounding law,’ I have reason to hope its approach will not stand the test of time.” This reminds that the now-overruled Chevron doctrine requiring courts to grant “deference” to agency interpretations of ambiguous statutes was built on an overreading of stray dicta in its namesake Chevron v. NRDC. And at the risk of being an optimist, one wonders whether Consumers’ Research may end up being something of a one-off that we should not overread.  Time will tell. But what is clear at Loper Bright’s one-year mark is that while the result in Consumers’ Research was disappointing to many, Loper Bright is a landmark victory reaffirming that it is up to the Judiciary—and not the Executive—to say what the law is and independently determine the metes and bounds of the discretion and powers Congress has granted the Executive. While Loper Bright is not a panacea for the ill effects of the current distortion in our system of separated powers and federalism, it is an important, much-needed step in the right direction that, to borrow Justice Kavanaugh’s language, “mitigates” some of those problems.