Hemel: Flips And Splits In Administrative Law

Daniel J. Hemel (NYU; Google Scholar), Flips and Splits in Administrative Law: 

In Loper Bright Enterprises v. Raimondo, the Supreme Court discarded the four-decade-old Chevron deference regime and circumscribed the authority of federal agencies to choose among multiple interpretations of ambiguous statutes. In justifying its ruling, the Loper Bright majority argued that Chevron deference had generated unnecessary regulatory uncertainty by allowing agencies to switch from one interpretation of an ambiguous statute to another. Against that backdrop, Loper Bright marks a move toward temporal uniformity in federal law: once the courts recognize a certain reading of a statute as “best,” that reading will reign under Loper Bright unless and until Congress repeals or amends the relevant provision.

Yet the temporal uniformity of the new Loper Bright regime comes at the cost of greater spatial disuniformity: Loper Bright will predictably produce more frequent conflicts among the regional courts of appeals regarding the reading of ambiguous statutes. Previously, courts applying Chevron asked only whether the agency’s interpretation of an ambiguity was “reasonable”; now, courts must decide whether the agency’s interpretation is correct—a question more prone to generate inter-circuit disagreements. Given the Supreme Court’s limited certiorari docket, many of these disagreements will persist for years—in some instances, indefinitely. Loper Bright thus reflects a decision to tolerate fewer “flips” across administrations but more “splits” across circuits. That result, along with the more obvious shift in interpretive authority from agencies to courts, is likely to be among Loper Bright’s most significant long-term consequences.

Analysis of the flip/split tradeoff sheds light not only on Loper Bright’s lasting effects but also on other debates in public law, including debates over Supreme Court certiorari practice, circuit court confirmations, district court nationwide injunctions, and—even more broadly—the choice between centralized and decentralized governance of a geographically polarized polity. This essay contributes to those debates by comparing the costs—and potential benefits—of flips and splits along four key dimensions: economic efficiency, regulatory efficacy, learning, and individual choice. A cost-benefit analysis of temporal and spatial disuniformity yields the tentative conclusion that Loper Bright—insofar as it recalibrated the balance away from flips and toward splits—shifted administrative law in a desirable direction. More generally, rigorous examination of Loper Bright’s temporal and spatial dimensions can yield lessons that travel well beyond the U.S. administrative law context—lessons that apply to the design of legal institutions in a wide range of narrowly divided societies.

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