On Monday, the Supreme Court granted the opportunity for fresh and comprehensive challenges to regulations, even if they have been in effect for a long time. This decision marks the third setback for federal agencies within a week.
In a 6-3 ruling, the justices have sided with a North Dakota truck stop that seeks to file a lawsuit regarding a regulation on debit card swipe fees that was upheld by the federal appeals court in Washington a decade ago.
According to federal law, regulations can be broadly challenged within a six-year timeframe. The Federal Reserve’s regulation that mandates fees for merchants on debit card transactions was implemented back in 2011.
According to the Biden administration, the deadline for lawsuits regarding the regulation was in 2017. In spite of the fact that Corner Post, a truck stop in Watford City located in western North Dakota, did not open until 2018, a federal appeals court concluded that their challenge was filed too late.
The Supreme Court was appealed to by the company. The dismissal had been urged to be upheld by the administration as they believed governmental agencies would be constantly challenged if it wasn’t.
The conservative majority of the court, led by Justice Amy Coney Barrett, stated that the clock of six years did not begin to tick for Corner Post until the year 2018 when it began accepting debit cards upon opening for business.
In light of the recent ruling that overturned the 1984 Chevron decision, the decision regarding regulations could hold even greater weight. This ruling has changed the landscape of upholding regulations across various sectors in American life. The court’s decision has also stripped the Securities and Exchange Commission of a crucial tool in their fight against securities fraud.
Justice Ketanji Brown Jackson, along with her fellow liberal justices, expressed dissent regarding the Court’s rulings in this case and Loper Bright. She cautioned that the flood of lawsuits that may arise as a result of these decisions could potentially harm the proper functioning of the Federal Government. Loper Bright, which overturned Chevron, was cited as a precedent in this case.
Jackson’s claim that the Supreme Court should extend the time frame for challenging regulations was met with criticism from Barrett, who found it “baffling — indeed, bizarre.” Despite this, Barrett did acknowledge that Congress could potentially intervene and alter the current time frame in question.
According to Dan Jarcho, a former lawyer for the Justice Department who has been closely monitoring the case, the recent rulings could lead to more favorable outcomes for parties such as Corner Post. Jarcho believes that the decision to eliminate Chevron deference, coupled with the Corner Post ruling, will undoubtedly result in an increase in successful litigation challenges against federal regulations, regardless of which agency issued them.
During the argument of the Corner Post case in February, Chief Justice John Roberts highlighted the predicament that the court was facing. He pointed out that agencies might have to face constant challenges even after 10 or 20 years and have to recreate the universe repeatedly.
Roberts expressed his opinion about a scenario where an individual or entity is adversely affected by the government’s actions, and it is assumed that no action can be taken because others had sufficient time to act on it. “You have an individual or an entity that is harmed by something the government is doing, and you’re saying, well, that’s just too bad, you can’t do anything about it because other people had six years to do something about it,” Roberts stated.
Roberts emphasized that the fundamental legal principle of granting everyone their right to a fair trial does not come with any exceptions, including situations where someone else has already had their day in court.
