The Brand X Effect: Declining Chevron Deference for EPA and Increased Success for Environmental Groups in the 21st Century

In a 2001 study of judicial review of EPA decision-making in the 1990s, Christopher Schroeder and Robert Glicksman found that the federal circuit courts were deferring more frequently to the agency after the Supreme Court’s decision in Chevron v. NRDC. That contrasted sharply with their findings, in an earlier article, that courts aggressively reviewed EPA’s actions during the 1970s, interpreting the environmental statutes according to their broad purposes and declining to accord deference to the agency. In the nearly two decades since Schroeder and Glicksman concluded their study of federal circuit review of EPA decisions in the 1990s, the manner in which courts apply the Chevron analysis has evolved and legislative, judicial and academic hostility to the decision has grown. This article updates their study by examining all of the federal circuit court cases decided between 2000 and 2016 that reviewed EPA actions under Chevron to determine whether the nature of judicial review of EPA’s decisions has changed as Chevron has evolved. An analysis of those decisions demonstrates that the Chevron effect perceived by Schroeder and Glicksman in the 1990s has faded and the circuit courts deferred less frequently to EPA during the study period. The biggest factor in the shift appears to be the Supreme Court’s decision in National Cable & Telecommunications Association v. Brand X Internet Services. While the circuit courts were affirming EPA’s decisions at a rate of almost 77% in cases in the study period decided before Brand X, they affirmed the agency‘s decisions at a rate of 67% (ten points lower) in the years after Brand X. The nature of the courts’ Chevron review changed significantly as well. While the courts were resolving statutory interpretation questions at Step One of Chevron in 33% of the challenges decided before Brand X, they resolved challenges at Step One 50% of the time after Brand X. In addition to the findings regarding a decline in Chevron deference, the data demonstrate that, despite the shift toward textualism in many courts, the circuit courts continued to discuss legislative history or statutory purpose in more than 1/3 of the opinions. The citation to those sources appeared to be strategic, though, as courts cited legislative history or statutory purpose in opinions more frequently when the courts were upholding the challenges of environmental groups or rejecting the challenges of regulated entities. Just as Schroeder and Glicksman noted regarding judicial review of EPA actions in the 1970s, the courts during this study period appeared to be defending environmental values by interpreting statutes broadly to achieve their purposes. Finally, most of the Chevron challenges to EPA actions that have been adjudicated by the circuit courts between 2000 and 2016 were brought by environmental and public interest groups and those groups were significantly more successful than regulated entities when challenging the agency’s decisions. While EPA’s decisions were upheld 82.9% of the time when they were challenged by regulated entities, they were only upheld 62.9% of the time when they were challenged by environmental or public interest groups. In a series of articles, Professor Wendy Wagner has demonstrated that regulated entities have significantly greater access to EPA in the decision-making process and she has suggested that the agency frequently adopts legally suspect interpretations of the environmental laws as a consequence of that imbalance. The significant difference between the success rate of environmental groups and regulated entities when challenging the agency’s decisions supports her assertions.