Eric Reicin, President & CEO of BBB National Programs, a nonprofit organization dedicated to a more accountable, trustworthy marketplace.

On June 28, 2024, the U.S. Supreme Court handed down its landmark decision in Loper Bright Enterprises v. Raimondo, one that Justice Elena Kagan in dissent predicted would “cause a massive shock to the legal system."

Six months later, it is time to examine the ruling’s aftershocks, watching closely to see if they eventually turn into broader legal and business trends.

The Supreme Court’s decision in Loper centered on the applicability of the Chevron doctrine, which had guided courts for nearly four decades. Under Chevron, courts deferred to reasonable agency interpretations of ambiguous statutes. In Loper, however, the Court ruled that such deference improperly expanded the power of administrative agencies beyond the scope of statutory authority granted by Congress.

One clear aftershock is that the Loper case, which struck down Chevron, has already begun reshaping how courts approach administrative regulations while prompting businesses and industries to reassess their strategies for compliance and self-regulation.

The post-Loper judicial landscape is already reflecting this new paradigm. A fault line has developed, as federal courts have begun scrutinizing agency actions with increased rigor, particularly where statutory authority appears ambiguous.

As one might expect after a major Supreme Court decision, U.S. courts of appeals rulings cited Loper at least 26 times in just July and August alone, according to a Bloomberg Law tally. Regulations were struck down in four cases, halted in 15 others and, in three cases, the government’s request for a temporary pause was denied. Only in four of the 26 cases did the government prevail at that litigation stage.

This increased judicial scrutiny stemming from Loper is, in turn, prompting federal agencies to revisit their rulemaking strategies and those affected by those agencies to take a fresh look at their legal strategies, with the focal point being defensible interpretations rooted in explicit statutory language.

For instance, the Federal Communication Commission's (FCC) ability to interpret and enforce the Telephone Consumer Protection Act (TCPA) has arguably been weakened, throwing the effectiveness of a new rule overturning the “lead generator” loophole into question. In Insurance Marketing Coalition Ltd. v. FCC, a trade group has asked the Commission to hold off on that rule clamping down on robocalls and texts while the organization pursues an 11th Circuit challenge to the new regulations.

In addition, the U.S. Supreme Court is set to hear oral arguments on January 21 in a challenge to a California district court's determination that it was forced, under the Hobbs Act, to accept the Federal Communications Commission's 2019 ruling that online faxes are not covered by the Telephone Consumer Protection Act.

Also, as Law360 has reported, a federal 9th Circuit judge wondered recently “what weight the court should give the Environmental Protection Agency's view in a chemical wholesaler's appeal of an $850,000 fine in light of the U.S. Supreme Court's Loper Bright decision.” And a variety of other federal agencies are seeing recent challenges to longstanding dispute resolution or other rules. Among others, the 5th Circuit struck down the U.S. Department of Labor’s 80/20 tip-credit rule, federal courts issued a nationwide injunction against the FTC’s noncompete ban, and employers are arguing in federal courts that the National Labor Relations Board decisions should get limited deference and that its longstanding adjudication procedures and structure are unconstitutional.

On January 2, 2025, the 6th Circuit Court of Appeals, citing Loper in part, held that the FCC lacked authority to impose net-neutrality policies on broadband internet service providers.

Indeed, the regulatory implications of Loper are profound, likely “the shock” to which Justice Kagan was referring in her dissent. Agencies that once relied on Chevron deference to defend expansive rules must now tread more carefully. While not yet completely clear after six months, a picture is starting to form, with federal agencies avoiding the stretching of statutory language, opting instead for narrowly tailored regulations. Also getting clearer is that in areas where Congress fails to act decisively, regulatory gaps may emerge, leaving industries without clear guidance.

Industry Self-Regulation: A Renewed Opportunity

In this uncertain regulatory climate, industry self-regulation is gaining renewed attention as a viable solution for maintaining standards while minimizing legal risk. Industry self-regulation allows industries to develop codes of conduct and set guidelines tailored to their unique needs, reducing reliance on potentially vulnerable regulatory frameworks.

Without the constraints of statutory interpretation, industry self-regulation offers greater adaptability. Industries can quickly address emerging issues, such as new technologies or consumer trends, without waiting for legislative or regulatory action.

While our organization, BBB National Programs, is the home of the largest array of industry self-regulation programs in the U.S., other examples of industry self-regulation have stood the test of time. For example, the Financial Industry Regulatory Authority (FINRA) enforces a code of conduct for brokerage firms, balancing industry expertise with public accountability.

Self-regulation offers promise in the post-Loper environment, yet it is not without challenges. When our nonprofit organization is exploring new industry self-regulation programs with a sector that is unfamiliar with the concept, we make a key point at the outset that self-regulation promotes competition by encouraging consistent standards rather than a patchwork of competing guidelines.

Where industry self-regulation does not work is if it is only about industry self-interest. Industry self-regulation should always be focused on enhancing consumer trust. And that is where collaborative efforts with independent third parties come in, addressing this concern by ensuring that consumers are heard.

Where Is The Legal Landscape Headed?

The Loper decision aftershocks do have the potential to create a chasm in judicial philosophy, one that prioritizes legislative precision on the one side over administrative discretion on the other. For businesses, this shift underscores the importance of proactive engagement with lawmakers and regulators to ensure clear statutory language and workable rules.

Concurrently, the decision highlights the potential for industry-led initiatives to fill gaps in governance. By embracing self-regulation as a complement to formal oversight, businesses can help shape a regulatory landscape that is effective and resilient in the face of judicial scrutiny.

Six months after Loper Bright, its implications are only beginning to unfold. From courtrooms to boardrooms, the decision is driving a re-evaluation of how businesses interact with regulators and manage compliance. By leveraging the opportunities presented by self-regulation, industries can navigate the aftershocks responsibly and, in the process, innovate while promoting competition.

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