The case arose from a challenge by Atlantic herring fishing companies to a National Marine Fisheries Service (NMFS) rule requiring vessels to carry onboard observers and to pay the costs of those observers when appropriated funds were unavailable. The Magnuson–Stevens Fishery Conservation and Management Act (MSA) authorizes fishery management plans to require observer coverage and, in certain specifically enumerated contexts, to require industry-funded monitoring. However, Congress did not expressly require industry funding for the Atlantic herring fishery. NMFS nonetheless promulgated a rule mandating that herring vessels contract with and pay third-party monitoring providers, with costs that could approach hundreds of dollars per sea day and materially reduce fishing revenues. The plaintiffs argued that the MSA did not authorize NMFS to impose such funding obligations absent clear statutory authorization. The district court upheld the rule, and the D.C. Circuit affirmed under Chevron, concluding that any statutory ambiguity permitted deference to NMFS's reasonable interpretation. A similar challenge in the First Circuit (Relentless, Inc. v. Dept. of Commerce) also failed under Chevron. The Supreme Court granted certiorari, consolidated the cases for argument, and asked whether Chevron should be overruled and what standard should govern the statutory question.
Does the APA permit courts to defer to an agency's reasonable interpretation of an ambiguous statute under Chevron, or must courts exercise independent judgment in interpreting statutes, giving at most Skidmore respect to agency views? And, applying the proper standard, did the MSA authorize NMFS to require the herring industry to fund third-party observers?
Under APA § 706, courts must decide all relevant questions of law and interpret statutory provisions independently. Ambiguity in a statute does not trigger binding judicial deference to an agency's interpretation. Agency interpretations may receive weight only to the extent they have the power to persuade (Skidmore v. Swift & Co.), and courts must respect actual delegations of discretionary policymaking authority that Congress confers. Chevron and its progeny, including any principle allowing agencies to displace prior judicial constructions of statutes (Brand X), are overruled. Prior judicial decisions resolving statutory questions remain precedents on the meaning of those statutes.
The Supreme Court overruled Chevron and held that the APA requires courts to exercise independent judgment in interpreting statutes; agency interpretations are entitled only to Skidmore's persuasive weight, not binding deference based on ambiguity. The judgments below were vacated and the cases remanded for further proceedings consistent with this standard, including consideration of the MSA issue without Chevron deference.
Text and structure of the APA: The Court grounded its analysis in APA § 706, which commands that reviewing courts "decide all relevant questions of law" and "interpret constitutional and statutory provisions." That text, the Court explained, codifies the traditional judicial function of saying what the law is. Chevron's requirement that courts yield to agency interpretations when statutes are ambiguous is inconsistent with that command because it substitutes an agency's view for the court's independent judgment on the meaning of the law. Historical practice: Before Chevron, courts interpreted statutes de novo while giving due regard to agency expertise under Skidmore. That tradition recognized that agencies may inform a court's judgment through expertise and experience, but it did not convert ambiguity into a transfer of interpretive authority. The Court viewed Chevron as a departure that proved unworkable in application, with the indeterminate trigger of "ambiguity" creating instability and inviting strategic agency oscillations in interpretation. Separation of powers: Deferring to executive interpretations because a statute is ambiguous undermines the judiciary's constitutional role and risks aggrandizing executive power. While Congress can and often does delegate discretionary authority to agencies—using capacious terms that call for policy judgments—courts must first determine the scope of that delegation as a matter of law. When a statute truly delegates discretion, courts will respect that delegation; but where the question is one of statutory meaning, the court must decide it. Stare decisis and reliance: The Court concluded Chevron lacked a firm statutory foundation, had proved difficult to administer (with step zero, step one/step two disputes, and Brand X's displacement of judicial precedent), and generated regulatory instability. Reliance interests cut both ways, and the better reading of the APA resolves the matter. Importantly, the Court clarified that prior decisions resolving the meaning of specific statutory provisions remain binding precedents; their holdings do not vanish with Chevron's demise. To the extent Brand X allowed agencies to supersede prior judicial constructions, it is incompatible with the APA and is no longer good law. Application and disposition: Because the lower courts upheld NMFS's industry-funded observer rule by applying Chevron deference, the Supreme Court vacated and remanded for reconsideration under the correct legal standard. On remand, the courts must interpret the MSA independently, may consider NMFS's views for their persuasive force under Skidmore, and must determine whether Congress authorized the funding requirement.
Loper Bright resets the baseline of judicial review in administrative cases. Going forward, courts will interpret statutes de novo and will not treat ambiguity as a license for agency control over legal meaning. Agencies retain room to make policy within the bounds of actual statutory delegations and to persuade courts with expertise, but they cannot command deference simply by identifying ambiguity. For law students, the case re-centers the APA's text, revives Skidmore as the primary framework for weighing agency interpretations, narrows Brand X, and reinforces separation-of-powers themes that will animate future litigation across regulatory domains. The decision also signals increased importance of legislative clarity, record development of agency reasoning, and careful doctrinal framing in judicial review.
Loper Bright marks a fundamental shift in administrative law, relocating primary interpretive authority from agencies back to Article III courts and grounding the move squarely in the APA's command that courts decide questions of law. While agencies continue to implement statutes and exercise properly delegated discretion, their legal interpretations now persuade rather than bind.