Judicial Review of Agency Actions: Chevron and Beyond

Judicial review of agency actions is the mechanism by which federal courts examine whether administrative agencies have acted within the authority granted to them by Congress and in accordance with constitutional requirements. This page covers the foundational doctrines — including Chevron U.S.A., Inc. v. Natural Resources Defense Council and its 2024 replacement framework — the procedural structure of review, the scenarios that most commonly trigger litigation, and the standards courts apply when drawing the line between permissible agency discretion and unlawful agency overreach. Understanding these doctrines is essential for grasping how the regulatory state interacts with the judiciary across agencies such as the Environmental Protection Agency (EPA), the Federal Communications Commission (FCC), and the Occupational Safety and Health Administration (OSHA).

Definition and Scope

Judicial review of agency actions refers to the power of Article III courts to assess the legality of rules, orders, adjudications, and other formal exercises of authority by federal administrative agencies. The primary statutory framework governing this review is the Administrative Procedure Act (APA), 5 U.S.C. §§ 701–706, enacted in 1946. Under 5 U.S.C. § 706, a reviewing court must set aside agency action that is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law," or that exceeds the agency's statutory jurisdiction.

The scope of review is not uniform across all agency activity. Courts distinguish between:

• Final agency action — the only category reviewable under the APA (5 U.S.C. § 704), meaning the action must mark the consummation of the agency's decision-making process and produce legal consequences.
• Informal rulemaking — rules produced through the "notice-and-comment" process under 5 U.S.C. § 553, reviewed under the arbitrary-and-capricious standard.
• Formal rulemaking and adjudication — proceedings that require an on-the-record hearing, reviewed under the "substantial evidence" standard (5 U.S.C. § 706(2)(E)).
• Agency inaction — reviewable only in narrow circumstances, as established in Heckler v. Chaney, 470 U.S. 821 (1985), where the Supreme Court held that an agency's refusal to take enforcement action is presumptively unreviewable.

This area of law sits at the intersection of administrative law and regulatory agencies and the separation of powers legal framework — courts must balance deference to executive branch expertise against their own obligation to say what the law is.

How It Works

The procedural architecture of judicial review follows a structured sequence.

1. Exhaustion of administrative remedies. A petitioner ordinarily must exhaust all available agency-level review before seeking judicial relief. Failure to exhaust can divest a court of jurisdiction or result in waiver of arguments.
2. Establishing standing. The petitioner must satisfy Article III standing requirements — injury in fact, causation, and redressability — as interpreted in Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992). The standing to sue requirements framework applies with full force in administrative cases.
3. Identifying the appropriate forum. Jurisdiction over challenges to specific agency rules may be vested in a circuit court by statute (bypassing district courts entirely), or may proceed through the federal district courts under general federal question jurisdiction (28 U.S.C. § 1331).
4. Selecting the standard of review. The court identifies whether the question is one of fact (substantial evidence or arbitrary-and-capricious review), law (the domain historically occupied by Chevron deference or its successor), or procedure (notice-and-comment compliance, required findings).
5. Application of the governing deference doctrine. This step is where the doctrine has changed most dramatically (see below).
6. Remedy. Courts may vacate an unlawful rule, remand to the agency without vacatur, or issue injunctive relief. The choice among these options is a distinct analytical step governed partly by Allied-Signal, Inc. v. U.S. Nuclear Regulatory Commission, 988 F.2d 146 (D.C. Cir. 1993).

The Chevron Doctrine and Its Replacement

For four decades, Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837 (1984), structured how courts reviewed an agency's interpretation of the statute it administers. The two-step framework asked: (Step 1) Has Congress directly addressed the precise question at issue? If yes, apply the statute. If no, (Step 2) is the agency's interpretation reasonable? If so, defer to it.

In Loper Bright Enterprises v. Raimondo, 603 U.S. ___ (2024), the Supreme Court overruled Chevron and held that courts must exercise independent judgment in determining the meaning of statutes, consistent with the APA's command in 5 U.S.C. § 706 that courts "shall decide all relevant questions of law." (Supreme Court slip opinion, No. 22-451.) Agency expertise remains a factor courts may consider, but it no longer compels deference.

A separate doctrine — Skidmore v. Swift & Co., 323 U.S. 134 (1944) — survives. Under Skidmore, an agency interpretation earns persuasive weight proportional to the thoroughness of its reasoning, the consistency of the agency's position over time, and the agency's relevant expertise. Skidmore deference is calibrated, not categorical.

Common Scenarios

Judicial review of agency action arises across the full spectrum of federal regulation. The four most frequently litigated scenarios involve:

Major rulemaking challenges. Regulated industries or advocacy organizations petition circuit courts — most often the D.C. Circuit — to vacate a final rule on grounds that the agency exceeded its statutory authority, failed to adequately explain its reasoning, or violated notice-and-comment requirements. The EPA's regulation of greenhouse gas emissions, the FCC's net neutrality rules, and OSHA's emergency temporary standards have each generated landmark circuit-court litigation.

Major Questions Doctrine cases. In West Virginia v. EPA, 597 U.S. 697 (2022), the Supreme Court held that when an agency claims authority to decide a question of vast economic and political significance, courts must require Congress to have spoken clearly before accepting that claim. (West Virginia v. EPA, slip opinion.) This doctrine operates as a threshold inquiry that can override what would otherwise appear to be plausible statutory readings.

Arbitrary-and-capricious challenges to rule rescission. An agency that rescinds an existing rule must provide reasoned explanation just as it would when promulgating one. FCC v. Fox Television Stations, Inc., 556 U.S. 502 (2009), confirmed that agencies need not demonstrate the prior rule was erroneous — only that the new policy is reasonable and acknowledged — but Department of Homeland Security v. Regents of the University of California, 591 U.S. 1 (2020), demonstrated that a bare assertion of discretion does not satisfy that standard.

Agency adjudication and enforcement orders. Individuals and entities subject to agency-imposed penalties or license revocations may challenge those orders, which are reviewed for substantial evidence and for procedural compliance with the APA's formal adjudication requirements (5 U.S.C. §§ 554, 556–557). The appellate review standards governing these proceedings differ from those applied to informal rulemaking.

Decision Boundaries

Courts apply distinct standards depending on the nature of the agency action under review, and confusing those standards is a categorical error in administrative litigation.

Arbitrary and capricious review under Motor Vehicle Manufacturers Ass'n v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29 (1983), requires an agency to examine relevant data, articulate a satisfactory explanation, and not contradict evidence before it or make a factual finding unsupported by the record. Courts do not substitute their judgment for the agency's; they ask whether the agency's own logic holds together.

Substantial evidence review is formally more demanding than arbitrary-and-capricious review — it requires that the record as a whole support the agency's factual findings — though in practice the two standards often yield similar outcomes. The burden of proof standards applicable to agency adjudication mirror but do not replicate those used in Article III courts.

The major questions doctrine operates as a limiting principle on statutory interpretation: when agency action carries vast economic significance, statutory ambiguity does not license assertion of broad authority. This boundary has narrowed the operative space for agency discretion significantly since 2022, affecting how agencies in sectors from energy to healthcare frame their regulatory justifications.

Finally, the line between reviewable final agency action and unreviewable

References

• National Association of Home Builders (NAHB) — nahb.org
• U.S. Bureau of Labor Statistics, Occupational Outlook Handbook — bls.gov/ooh
• International Code Council (ICC) — iccsafe.org