SCOTUS’s current term ends in late June, and if the past months are any indication, what comes out of these final weeks will matter enormously to corporate America.
At the center of all this is a doctrine that has quietly become one of the most consequential tools in administrative law: the major questions doctrine.
The concept is fairly straightforward: when a federal agency attempts to regulate something of vast economic or political significance, it cannot simply point to a value-granting authority. It needs explicit congressional authorization.
The doctrine was immortalized in 2022’s West Virginia v. EPA (Environmental Protection Agency) when the court struck down the EPA’s emissions regulation, holding that an agency cannot make national policy choices by stretching the ambiguous language of old statutes.
In February, the Court applied similar reasoning in Learning Resources v. Trump, striking down the administration’s tariffs imposed under the International Emergency Economic Powers Act (IEEPA), a presidential power that had been used with no judicial pushback for decades.
The practical effect of the major questions doctrine has been to shift the “center of gravity,” if you will, in regulatory disputes from agencies to courts.
Companies that once built compliance plans around what the SEC, FTC, or EPA wanted to do now have to model what the courts will allow them to do. An agency’s stated position no longer signals the same safe harbors the way it once did.
At the same time, the doctrine is a double-edged sword. Businesses that benefit from stable, predictable regulation, banks operating under longstanding Fed rules, and pharmaceutical companies whose approval processes depend on FDA authority all face uncertainty.
The Supreme Court term ends in late June, with several major decisions pending, including a direct challenge to the major questions doctrine’s bar to agency rulemaking. What comes out of One First Street this month will set the boundaries of regulatory authority for years to come.
For corporate counsel and executives alike, the takeaway is the same one this article keeps returning to: knowing what regulators say is no longer enough. Understanding what courts will sustain is now the core competency.