Chevron Two Step: How It Worked and Why Loper Bright Ended It

The Chevron two-step was a doctrine that governed how federal courts reviewed agency interpretations of law from 1984 until June 2024. Under the framework, a court first asked whether Congress had spoken clearly to the question at issue; if not, it accepted the agency’s reading so long as that reading was reasonable. The Supreme Court retired the doctrine in Loper Bright Enterprises v. Raimondo, ruling that judges must now use their own independent judgment when interpreting the statutes agencies administer.¹

Before it was overruled, Chevron was cited in more than 18,000 court opinions, making it the most-cited administrative law decision in Supreme Court history.²³

How the Two Steps Worked

At Step One, a reviewing court asked whether Congress had “directly spoken to the precise question at issue.” If the statute’s meaning was clear, that ended the inquiry. Both the court and the agency had to follow Congress’s unambiguous command. Judges used what they called the “traditional tools of statutory construction” to decide this, including the text, the statute’s structure, and, for some judges, legislative history.⁴

If the statute was silent or ambiguous on the specific issue, the court moved to Step Two and asked whether the agency’s interpretation was a “permissible construction” of the statute. If it was, the court had to accept it, even if the judge would have read the statute differently.⁵ The reasoning was that a gap in a statute represented an implicit congressional delegation to the expert agency to fill it, and that courts owed deference to the resulting policy choices.⁶

Step Two was extremely deferential in practice. A study of 1,558 agency interpretations reviewed by federal circuit courts between 2003 and 2013 found that once a case reached Step Two, agencies won 93.8% of the time. Only 51 of the 1,158 interpretations that made it past Step One were ultimately invalidated.⁷ Scholars described what happened at Step Two as “automatic judicial acquiescence” and “obsequious deference.”⁸

Where the Doctrine Came From

The dispute that produced the framework was about air pollution permits. Under the Clean Air Act Amendments of 1977, states that had not met national air quality standards had to set up permit programs for “new or modified major stationary sources” of pollution. The EPA issued regulations in 1981 adopting a “plantwide definition” of “stationary source,” so a factory could install or modify equipment without triggering new permit requirements as long as the plant’s total emissions did not increase. The Natural Resources Defense Council challenged this “bubble concept,” and the D.C. Circuit struck the regulation down.⁹

The Supreme Court reversed on June 25, 1984, in a 6-0 decision written by Justice John Paul Stevens. The Court held that the EPA’s plantwide definition was a permissible reading of the statute and reflected a “reasonable policy choice” balancing economic and environmental concerns.⁵ Justices Marshall, Rehnquist, and O’Connor did not participate.⁹ Lower courts quickly distilled the opinion into a two-step test they began applying whenever anyone challenged a federal agency’s reading of a statute the agency administered.⁶

The Two Steps Were Never Really Two

Over the decades, courts added gates, exceptions, and threshold questions that made the framework far more elaborate than the original opinion suggested.

Step Zero

In United States v. Mead Corp. (2001), the Supreme Court established what became known as “Step Zero,” a threshold question that came before the two-step analysis: did the agency act with the “force of law”? An agency interpretation issued through informal means, such as an opinion letter or policy statement, might fall outside the framework entirely. If it came out of formal rulemaking or adjudication, it qualified for Chevron review.¹⁰ Step Zero later expanded to take in other considerations, including the emerging “major questions” limit on agency authority.¹¹

Brand X

In National Cable & Telecommunications Ass’n v. Brand X Internet Services (2005), the Court held that an agency’s new interpretation of an ambiguous statute could override a prior federal court ruling that had read the same statute differently. A prior judicial construction only blocked the agency if the earlier court had held that its reading came from the statute’s unambiguous terms. If the earlier court had just picked what it thought was the best reading of an ambiguous provision, the agency remained free to adopt a different, reasonable one.¹²

The Major Questions Doctrine

In King v. Burwell (2015), the Court refused to apply Chevron at all to a challenge over whether Affordable Care Act tax credits were available on federally established health insurance exchanges. Chief Justice Roberts wrote that in “extraordinary cases” involving questions of “deep economic and political significance,” courts should not presume Congress implicitly delegated interpretive authority to an agency. It was “especially unlikely,” he added, that Congress would have delegated the question to the IRS, “which has no expertise in crafting health insurance policy.” The Court read the statute itself and upheld the credits, 6-3.¹³

That limitation hardened into the major questions doctrine in West Virginia v. EPA (2022). The Court struck down the Obama-era Clean Power Plan, which would have required a sector-wide shift from coal to natural gas and renewables. When an agency claims authority of “vast economic and political significance” in a “long-extant, but rarely used” statute, the majority held, courts should require “clear congressional authorization” rather than defer. Because the EPA’s approach would have restructured the domestic energy industry at a cost of billions, and because Congress had “conspicuously declined to enact” a comparable cap-and-trade scheme, the Court found no such clear authorization.¹⁴

Why Critics Wanted Chevron Gone

The deepest objection was constitutional. Critics argued that requiring courts to defer to agency readings of statutes undermined the judicial duty, laid down in Marbury v. Madison, “to say what the law is.” Justice Thomas wrote in a concurrence that Chevron raised “serious separation-of-powers questions” and was “potentially unconstitutional.”¹⁵ Justice Gorsuch called it a “judge-made doctrine for the abdication of the judicial duty,” one that let agencies reverse course based on political shifts and operate largely free of judicial oversight.⁸

A separate critique targeted the framework’s internal logic. Some scholars argued the two steps were “formally identical and therefore redundant,” since any statute clear enough to resolve the question at Step One would also produce only one permissible answer at Step Two. Matthew Stephenson and Adrian Vermeule argued in a 2009 article that Chevron effectively had “only one step” and should collapse into a single reasonableness inquiry. Justice Scalia endorsed that view from the bench in Entergy Corp. v. Riverkeeper, Inc. (2009), writing that the Court was “omitting the supposedly prior inquiry” and going straight to reasonableness.¹⁶

Circuit courts applied the doctrine unevenly. The D.C. Circuit invoked Chevron in 88.6% of relevant cases; the Sixth Circuit did so only 60.7% of the time. When Chevron was applied, agencies won 77.4% of the time; without it, they won just 53.6%. In most circuits, whether a court used Chevron at all could effectively determine the outcome.⁷

Loper Bright Ended It

On June 28, 2024, the Supreme Court overruled Chevron in Loper Bright Enterprises v. Raimondo, decided together with Relentless, Inc. v. Department of Commerce. The underlying dispute involved a National Marine Fisheries Service rule requiring Atlantic herring fishermen to pay for government-mandated at-sea observers, at an estimated cost of up to $710 per day, potentially reducing vessel owners’ annual returns by as much as 20%.¹

Chief Justice Roberts, writing for a 6-3 majority joined by Justices Thomas, Alito, Gorsuch, Kavanaugh, and Barrett, held that the Administrative Procedure Act requires courts to exercise their own independent judgment when deciding whether an agency has acted within its statutory authority. The opinion rested on Article III of the Constitution and Section 706 of the APA, which directs the “reviewing court” to “decide all relevant questions of law” and “interpret statutory provisions.” The Court called the presumption that statutory ambiguity equals implicit delegation a “fiction” and rejected the idea that agencies possess “special competence” in resolving questions of legal meaning.¹

Justice Kagan dissented, joined by Justice Sotomayor and, in the Relentless portion, Justice Jackson. Justice Jackson did not participate in the Loper Bright case itself.¹

The Court was careful about the reach of its ruling. Prior decisions that relied on Chevron are not automatically invalidated. Their holdings remain subject to ordinary principles of stare decisis, and reliance on Chevron alone is not a special justification for overruling them.¹

What Replaced It

Courts have returned to the standard set out in Skidmore v. Swift & Co. (1945). Under Skidmore, an agency’s interpretation is not binding but may be “especially informative” depending on “the thoroughness evident in its consideration, the validity of its reasoning, its consistency with earlier and later pronouncements, and all those factors which give it power to persuade.” A judge must reach an independent conclusion about what a statute means. The agency’s view may help; it cannot control.¹

The Supreme Court has begun employing what commentators call “Shadow Skidmore.” In Bondi v. VanDerStok (2025), which upheld ATF regulations on ghost guns, and FCC v. Consumers’ Research (2025), on the FCC’s universal-service funding scheme, the Court interpreted the statute independently and then noted that the agency had long held the same view, treating that consistency as confirmation rather than a reason to defer.¹⁷¹⁸

Lower courts have produced mixed outcomes. Some agency rules have fallen, including the Department of Labor’s tip-credit rule and the FCC’s net neutrality regulations, which the Sixth Circuit struck down on the ground that the Communications Act classifies internet services as information services. Others have survived independent judicial review, including IRS whistleblower definitions, ATF ghost gun rules, and the DOL’s rule on ESG investing in retirement plans.¹⁹ The Fifth Circuit remanded a challenge to the DOL’s ESG rule in Utah v. Su for fresh consideration under the independent judgment standard rather than deciding the question itself.²⁰

A fault line has emerged around Skidmore itself. The Sixth and Eleventh Circuits have issued divided opinions on whether Skidmore deference even survived Loper Bright, while most other circuits continue to invoke it. Some critics warn that certain lower courts are giving agency views “near-dispositive respect” under the Skidmore label, effectively reviving Chevron under a different name.²¹

A legislative effort to restore the doctrine is pending but has not advanced. In July 2024, Senator Elizabeth Warren and ten co-sponsors introduced the Stop Corporate Capture Act, which would codify Chevron and require courts to defer to federal agency experts interpreting ambiguous statutes during rulemaking. The bill has not been enacted.²²

1
Supreme Court of the United States. Loper Bright Enterprises v. Raimondo, 603 U.S. ____
2
Minnesota Law Review. The Impact of Loper Bright v. Raimondo: An Empirical Review of the First Six Months
3
Yale Journal on Regulation. Most Cited Supreme Court Administrative Law Decisions
4
University of Chicago Law Review. Chevron Step One-and-a-Half
5
Library of Congress. Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837
6
National Constitution Center. Chevron v. Natural Resources Defense Council, Inc.
7
Michigan Law Review. Chevron in the Circuit Courts
8
Fordham Law Review. The Chevron-State Farm Framework
9
Oyez. Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc.
10
The Regulatory Review. Did Step Zero Help Doom Chevron
11
University of Houston Law Center. Chevron Step Zero
12
Justia. National Cable & Telecommunications Ass’n v. Brand X Internet Services, 545 U.S. 967
13
Justia. King v. Burwell, 576 U.S. 473
14
Supreme Court of the United States. West Virginia v. EPA, 597 U.S. ____
15
George Washington Law Review. Chevron Deference and Separation of Powers
16
Indiana Law Journal. Re-Examining Chevron’s Steps
17
SCOTUSblog. A Year After Loper Bright
18
Harvard Law Review. Bondi v. VanDerStok
19
K&L Gates. A Year After Loper Bright: Lessons From a Legal Shake-Up
20
Molo Lamken. Federal Courts Grapple With Implications of Loper Bright
21
Yale Journal on Regulation. Some Thoughts on Skidmore Weight After Loper Bright
22
Office of Senator Elizabeth Warren. Warren Leads Senate Response to End of Chevron Doctrine