FALL 2024 · 69
Stay Inside the
Lines: Loper Bright’s
Impact on the FTC’s
Consumer Protection
Rulemaking and
Enforcement Activities
BY KATHERINE WHITE
FOR 40 YEARS, WHENEVER A FEDERAL
agency found itself in a dispute over the meaning
of an ambiguous term in a statute that it adminis-
tered, the agency could stand before a court, utter
the magic word “Chevron,” and reliably expect
that its interpretation would prevail. Under the Supreme
Court’s 1984 decision in Chevron v. Natural Resources
Defense Council,1 courts followed a two-step framework
when reviewing an agency’s interpretation. First, the court
looked to see whether Congress had spoken directly to the
question at issue. If it had, “that is the end of the matter,
for the court, as well as the agency, must give effect to the
unambiguously expressed intent of Congress.”2 If the stat-
ute was unclear, the court determined whether the agency’s
interpretation was “based on a permissible construction of
the statute.”3 In essence, “even when a reviewing court [read]
the statute differently,”4 the court was required to defer to
the agency’s reasonable interpretation.
Chevron was anchored in the presumption that ambi-
guities are policy delegations to administrative agencies.
“While agencies are not directly accountable to the people,
the Chief Executive is, and it is entirely appropriate for this
political branch of the Government to make such policy
choices—resolving the competing interests which Congress
itself either inadvertently did not resolve, or intentionally
left to be resolved by the agency charged with the admin-
istration of the statute in light of everyday realities.”5 The
Chevron court believed that where there was “a gap left open
by Congress,”6 it was desirable for expert agencies, rather
than judges, to have the final say on policy.
In June, in Loper Bright v. Raimondo,7 the Supreme
Court overruled Chevron, bringing an end to four decades
of deference to agencies. The Supreme Court found that
“[a] statutory ambiguity does not necessarily reflect a con-
gressional intent that an agency, as opposed to a court,
resolve the resulting interpretive question.”8 Moreover, such
ambiguities do not “somehow [relieve]” courts “of their
obligation to independently interpret statutes.”9 In addition,
over the years Chevron had proven to be unworkable and did
not provide “the sort of ‘stable background rule’ that fos-
ters meaningful reliance.”10 Every change of administration
could presage a change in an agency’s interpretation of a
statute, a state of affairs that Justice Gorsuch referred to as
causing “regulatory whiplash.”11
In the wake of Loper Bright, when faced with a statutory
ambiguity, “instead of declaring a particular party’s reading
‘permissible’ in such a case, courts use every tool at their dis-
posal to determine the best reading of the statute and resolve
the ambiguity.”12 Agencies no longer have an automatic
edge in litigation over matters of statutory interpretation,
and perhaps there will be fewer “convulsive change[s]”13 to
the meaning of a law accompanying the transition of power
after a presidential election.
Like other administrative agencies, the Federal Trade
Commission (“FTC” or “Commission”) benefited from
Chevron deference when facing challenges to its rules14 and
its enforcement authority.15 While the Supreme Court spec-
ified that the Loper Bright decision does not disturb the
holdings of any cases decided under Chevron,16 in the future
the FTC will need to convince courts that its interpretations
are not just reasonable, but the best reading of the statu-
tory language. This article discusses how Loper Bright might
impact the Commission’s consumer protection rulemaking
and enforcement work going forward.
FTC Rulemaking
The Commission issues consumer protection rules under
two distinct authorities: the Administrative Procedure Act
(“APA”)17 and Section 18 of the FTC Act.18 Loper Bright is
bound to have an effect on rules issued under both processes.
APA Rulemaking. The FTC does not have general APA
rulemaking authority, but Congress sometimes directs the
Commission to issue specific rules under the APA. The
Children’s Online Privacy Protection Act (“COPPA”)19—
directing the Commission to issue the Children’s Online
Privacy Protection Rule (“COPPA Rule”)20—and the Amer-
ican Recovery and Reinvestment Act of 200921—directing
the Commission to issue the Health Breach Notification
Rule (“HBN Rule”)22—are two such statutes.
COPPA Rule. In COPPA, Congress tasked the FTC
with issuing regulations that, among other things, require
websites and online services directed to children to (1) pro-
vide notice of their collection practices and obtain verifiable
Katherine White is a Partner at Kelley Drye & Warren LLP. All views
expressed in this article are solely the author’s own, not attributable to
the firm, its personnel, or any of its clients.
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