Supreme Court issues 'staggering' ruling on deadline to challenge agency actions
The U.S. Supreme Court on Monday issued a statute-of-limitations ruling that that allows plaintiffs injured by agency actions to set the deadline clock ticking at the time that they suffer injuries. (Image from Shutterstock)
The U.S. Supreme Court on Monday issued a statute-of-limitations ruling that that allows plaintiffs injured by agency actions to set the deadline clock ticking at the time that they suffer injuries.
The 6-3 decision “effectively makes last week’s reversal of Chevron retroactive,” wrote journalist Mark Joseph Stern on X, formerly known as Twitter.
The Supreme Court curbed agency power when it overruled Chevron v. Natural Resources Defense Council on June 28. Chevron had required federal courts to defer to agency interpretations of ambiguous laws. The high court said then its decision did not disturb prior cases relying on the Chevron framework.
“Wow,” wrote a commenter on SCOTUSblog. The statute-of-limitations decision “combined with Chevron being overruled—the court really isn’t prepared for the amount of new cases coming their way. Just wow.”
Justice Amy Coney Barrett wrote the majority opinion in the statute-of-limitations case, joined by five conservative justices.
The deadline for suits against the United States is “six years after the right of action first accrues.”
In challenges filed under the Administrative Procedure Act, the deadline is when the plaintiff is injured by final agency action, the majority held.
The Federal Reserve Board had argued that the clock begins to tick when an agency action is final.
The Supreme Court ruled in a challenge to debit-card merchant fees by Corner Post, a truck stop and convenience store located in Watford City, North Dakota. Corner Post had alleged that fee caps set by the Federal Reserve Board are higher than permitted by statute.
Corner Post did not exist when the Federal Reserve Board adopted the debit-fee regulation. It was incorporated in 2017 and opened its doors for business in 2018. The truck stop joined a lawsuit challenging the action in 2021.
Because Corner Post sued within six years of its injury, its challenge is not barred by the statute of limitations, Barrett said.
Justice Ketanji Brown Jackson dissented in an opinion joined by Justices Sonia Sotomayor and Elena Kagan.
“The flawed reasoning and far-reaching results of the court’s ruling in this case are staggering,” Jackson wrote.
“The court’s baseless conclusion means that there is effectively no longer any limitations period for lawsuits that challenge agency regulations on their face,” Jackson said. “Allowing every new commercial entity to bring fresh facial challenges to long-existing regulations is profoundly destabilizing for both government and businesses. It also allows well-heeled litigants to game the system by creating new entities or finding new plaintiffs whenever they blow past the statutory deadline.”
In a concurrence, Justice Brett Kavanaugh said Corner Post can sue because the APA allows vacatur of agency rules. The truck stop is not regulated by the Federal Reserve Board, but it can still challenge the agency debit-fee rule because of its alleged “adverse downstream effects,” Kavanaugh said.
The government has advanced “a far-reaching argument that the APA does not allow vacatur,” Kavanaugh said. Instead, the United States argued, the APA only allows courts to enjoin agency actions against a plaintiff.
The “newly minted” U.S. argument is “both novel and wrong,” Kavanaugh said. “Eliminating vacatur as a remedy would terminate entire classes of administrative litigation that have traditionally been brought by unregulated parties.”
The case is Corner Post v. Board of Governors of the Federal Reserve System.
Hat tip to SCOTUSblog, which had early coverage of the decision.
