The Recurring Question of Chevron Deference & Agency Jurisdiction:

Unless you’re an avid follower of federal energy law, there’s no reason you would have noticed the U.S. Court of Appeals for District of Columbia’s recent decision in Connecticut Department of Public Utility Control v. Federal Energy Regulatory Commission. In this case, a panel held that the Federal Energy Regulatory Commission (FERC) has jurisdiction to review the installed capacity requirement set by a regional transmission organization that administers regional electricity transmission. Those not focused on energy regulation (myself included) might be tempted to ask, “Who cares?” But not so fast. CDPUC v. FERC raised an interesting an important administrative law question that has bedeviled and divided federal appellate courts for years: Whether courts should grant Chevron deference to agency statutory interpretations that implicate the an agency’s regulatory jurisdiction.

In CDPUC v. FERC the D.C. Circuit answered this question in the affirmative. “We afford Chevron deference to the Commission’s assertion of jurisdiction,” the panel stated with no elaboration, citing to a 1994 D.C. Circuit decision and Chevron itself. What the panel failed to note, is that several other circuits disagree with this approach. Indeed, the D.C. Circuit itself has not always taken this view, and the U.S. Supreme Court has not addressed the question directly – though Justices Scalia and Brennan debated the issue in Mississippi Power & Light Co. v. Mississippi ex rel. Moore.

The Second, Third, Fourth and Ninth Circuits have all held that Chevron deference should apply in the jurisdictional context. The Seventh and Federal Circuits have gone the other way. Just this past March, in Tafas v. Doll, the Federal Circuit reiterated its position that “an agency's determination of the scope of its own authority is not entitled to Chevron deference.” Two weeks ago, the Federal Circuit agreed to rehear Tafas v. Doll en banc.

The D.C. Circuit, like the Eighth Circuit, has been less consistent on the subject. In Oklahoma Natural Gas Co. v. FERC -- the case relied upon in CPUC v. FERC -- the D.C. Circuit declared it would “review FERC's interpretation of its authority to exercise jurisdiction over transportation with the familiar Chevron framework in mind.” Yet in some prior cases, the D.C. Circuit has expressly declined to defer to agency interpretations of statutory provisions defining the scope of an agency’s jurisdiction. As the court explained in its 1987 decision in ACLU v. FCC:

it seems highly unlikely that a responsible Congress would implicitly delegate to an agency the power to define the scope of its own power. When an agency's assertion of power into new areas is under attack, therefore, courts should perform a close and searching analysis of congressional intent, remaining skeptical of the proposition that Congress did not speak to such a fundamental issue.
My own view is that the D.C. Circuit had it right in 1987 is wrong today. [This also, interestingly enough, places me on the side of Justice Brennan in Mississippi Power & Light.] As Nathan Sales and I argue in an article forthcoming in the University of Illinois Law Review, “The Rest Is Silence: Chevron Deference, Agency Jurisdiction and Statutory Silences,” courts should not defer to an agency’s statutory interpretations that implicates the existence or scope of an agency’s jurisdiction. We argue that such deference is not required by existing precedent, is inconsistent with the Chevron doctrine as currently understood, and is also unwise. A draft and abstract are on SSRN here; the article will be published later this year.

I do not know whether CPUC v. FERC is a good vehicle for presenting this issue to the Supreme Court. Nor do I know how much the Federal Circuit will focus on this specific question when it rehears Tafas v. Doll. But I do know this is an important question of administrative law, and one the Supreme Court will, sooner or later, have to address.

For some prior posts on this subject, see here.