By Tom Hals
(Reuters) - Challengers to federal rules covering a range of industries including mining and farming got a fresh shot on Tuesday at rolling back regulations as the U.S. Supreme Court applied a new standard for reviewing the power of federal agencies.
Nine lower-court rulings were vacated by the Supreme Court and sent back to be reconsidered in light of Friday's decision reversing the decades-old Chevron (NYSE:CVX) doctrine that said judges should defer to agencies to interpret laws they administer.
The cases were the first of what is expected to be a wave of rulings reassessing the power of federal regulators, who make rules covering everything from food and drugs to airlines and drinking water.
"This is going to have a widespread effect that we're going to be feeling for the months and years to come," said Loren Seehase, senior counsel at conservative legal group Liberty Justice Center.
Friday's ruling, in a case known as Loper Bright, does not mean any particular regulation will be overturned and some experts cautioned about reading too much into its impact.
But the ruling does mean judges must perform an independent assessment of whether a regulation is legal.
Before the Supreme Court overturned the 1984 Chevron precedent, judges were instructed to defer to an agency's interpretation when a statute was ambiguous.
The cases that were returned on Tuesday to lower courts of appeals included a 13-year dispute between South Dakota farmer Arlen Foster and Department of Agriculture regulators who concluded that an eight-inch pool of water on his property was a protected wetland.
Foster's case turned in part on the interpretation of the Swampbuster Act and the deference given to regulators by the 8th U.S. Circuit Court of Appeals in St. Louis last year.
“Our clients may now make their case in court without judges putting their thumb on the scale in favor of the government,” said Paige Gilliard, an attorney for Foster at the Pacific Legal Foundation.
Other cases that were returned to lower courts challenged regulations covering coal mining, solar power, immigration and whistleblower rewards for exposing tax dodgers.
Proponents for rolling back the Chevron deference said they expected the Loper Bright ruling to strengthen other challenges to regulations in cases that have yet to reach the Supreme Court.
These include what is known as the ESG investing rule, which allows fiduciaries to consider environmental, social and governance factors when evaluating financial plan investments.
A trial court upheld the rule in September by applying the Chevron deference. Oral arguments in the appeal are being heard by the 5th U.S. Circuit Court of Appeals in New Orleans on Tuesday and both sides already have raised the Loper Bright ruling in the appeal.
Challengers argued it meant the ESG rule must be struck down, while the Department of Justice noted that Chevron was never raised by the government to defend the regulation.