Justice Dept. weighs settlement in agency clash after landmark US Supreme Court ruling

By Mike Scarcella

July 16 (Reuters) - President Donald Trump’s administration told a U.S. appeals court on Wednesday that it is in talks to settle a regulatory dispute that was at the center of the U.S. Supreme Court’s blockbuster ruling last year curbing agency powers.

In a court filing, the U.S. Justice Department and New Jersey-based fishing company Loper Bright Enterprises asked the U.S. Court of Appeals for the District of Columbia Circuit to pause consideration of its challenge to a rule related to commercial fishing.

The notice to the court came one day after a U.S. judge in Rhode Island in a related lawsuit upheld the U.S. Commerce Department rule despite the Supreme Court's opinion.

The Supreme Court in June 2024 used the Rhode Island lawsuit and the Loper Bright case to overturn the 1984 precedent that said federal judges must give deference to how U.S. agencies interpret their own laws.

The 6-3 ruling was one of a string of opinions by the Supreme Court’s conservative majority in recent years to curb agency authority, and led to concerns that many regulations could be more easily toppled. The new Rhode Island ruling and the possibility of a settlement in the Loper Bright case suggest the reach of the high court's decision may be more limited in some circumstances.

The Justice Department declined to comment, and a lawyer for Loper Bright did not immediately respond to a request for one. Attorney John Vecchione, representing Relentless Inc, the fishery that filed the lawsuit in Rhode Island, said they planned to appeal Smith's ruling.

The 2020 rule at issue in both cases requires owners of regulated commercial vessels to fund a program for at-sea monitoring of overfishing of herring off New England's coast. The lawsuits said the rule was beyond the scope of the Commerce Department's power.

Both the Loper Bright case and the Rhode Island matter were sent back to the lower courts for further review after the Supreme Court's decision, which did not consider the merits of the monitoring rule.

U.S. District Judge William Smith in Rhode Island in his ruling on Tuesday said he was exercising his “independent judgment in deciding whether an agency has acted within its statutory authority,” quoting language from the Supreme Court’s ruling.

In Loper Bright’s case, the D.C. Circuit in November heard renewed arguments against the monitoring rule, but had not issued a decision. A panel of three judges appeared open to upholding the rule.

The lawyers for Loper Bright and the Justice Department said in their Wednesday court filing that they were in settlement discussions “to pursue a resolution of this long-running matter without the need for the court to decide the appeal.”

The filing did not provide a status of those discussions or include any details about the potential settlement.

The case is Loper Bright Enterprises Inc v. Raimondo, U.S. Court of Appeals for the District of Columbia Circuit, No. 21-5166.

For Loper Bright: Ryan Mulvey of Cause of Action Institute

For the government: Daniel Halainen of the U.S. Justice Department

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