Paul L. Caron

Tuesday, July 26, 2016

Chevron In The Circuit Courts:  IRS Is Afforded 4th Least Judicial Deference Among 22 Federal Agencies

Kent H. Barnett (Georgia) & Christopher J. Walker (Ohio State), Chevron in the Circuit Courts:

This Article presents findings from the most comprehensive empirical study to date on how the federal courts of appeals have applied Chevron deference — the doctrine under which courts defer to a federal agency’s reasonable interpretation of an ambiguous statute that it administers. Based on 1561 agency interpretations the circuit courts reviewed from 2003 to 2013, we found that the circuit courts overall upheld 71% of interpretations and applied Chevron deference 75% of the time. But there was nearly a twenty-five percentage-point difference in agency-win rates when the circuit courts applied Chevron deference than when they did not. Among many other things, our study reveals important differences across circuits, agencies, agency formats, and subject matters as to judicial review of agency statutory interpretations — as our rankings based on these variables illustrate.

Table 2

As Table 2 indicates, the subject matters for which courts defer most often to agency interpretations included telecommunications (8.60), Indian affairs (8.33), federal government (8.18), pensions (8.17), education (8.15), health and safety (8.14), and entitlement programs (8.03). Conversely, the subject matters for which courts defer the least were civil rights (5.99), followed by housing (6.04), prisons (6.64), tax (6.74), and employment (6.96). ...

[I]t perhaps should come as no surprise that tax ranks nineteen out of twenty two in light of entrenched tax exceptionalism. At 56.3%, moreover, tax was second to last in the rate at which circuit courts applied Chevron deference. Indeed, it was not until 2011 that the Supreme Court announced that certain IRS interpretations are entitled to Chevron deference—a position that the Supreme Court may have qualified last year in King v. Burwell, at least with respect to questions of deep political or economic significance. ...

Based on prior empirical studies of judicial deference at the Supreme Court, however, our findings suggest that there may be a Chevron Supreme and a Chevron Regular: Whereas Chevron may not have much of an effect on agency outcomes at the Supreme Court, Chevron deference seems to matter in the circuit courts. That there is a Chevron Supreme and a Chevron Regular may suggest that, in Chevron, the Supreme Court has an effective tool to supervise lower courts’ review of agency statutory interpretations.

National Law Journal, Where Federal Agencies Find the Most—and Least—Respect in Circuit Courts

Scholarship, Tax | Permalink


The table is interesting, but the interpretation is wrong because of the Priest-Klein effect. The win rate does not reflect the court's bias, since if, for example, a court was very deferential to the IRS, the IRS would press the most outrageous cases in that court, where it might win, and might end up with a lower-than-average win percentage because it even brought cases that other courts would have laughed at or sanctioned.

Posted by: Eric Rasmusen | Jul 26, 2016 10:14:17 PM