In Kisor v. Wilkie, the U.S. Supreme Court upheld Auer deference while restating the limited circumstances in which the administrative law principle applies. A principle of judicial review, Auer deference requires a federal court to yield to an administrative agency’s interpretation of an ambiguous regulation that the agency has promulgated.
The ruling in the case, about a marine veteran who challenged a U.S. Department of Veterans Affairs (VA) decision related to retroactive disability benefits, was unanimous in vacating and remanding the judgment of the Federal Circuit Court of Appeals. But justices disagreed about the future of judicial deference to agencies. The court instructed the Federal Circuit to redo the case and decide whether the application of Auer deference is appropriate.
Justice Gorsuch, who agreed to send the case back to the lower circuit, wrote a concurring opinion joined by Justices Thomas, Alito, and Kavanaugh, strongly criticizing the court for not overruling Auer deference as a doctrine.
Justice Kagan delivered the opinion of the court, which restated the following limitations on Auer deference:
1. Courts should only give Auer deference to an agency after establishing that the regulation in question is actually ambiguous. Courts must first consider the text, structure, history, and purpose of a regulation before deferring to a reasonable agency view.
2. A court must determine whether the reasonable agency interpretation of a regulation is an authoritative or official position of the agency before giving Auer deference.
3. Courts should only give Auer deference to agency interpretations based on the expertise of that agency. For questions that fall outside the regular duties of an agency, Auer deference is less appropriate.
4. The reasonable agency interpretation of an ambiguous regulation must be a “fair and considered judgment” that does not create an unfair surprise for those subject to the regulation in order to qualify for Auer deference. Courts should not defer to agency interpretations that were adopted just to help the agency during a lawsuit.