467 U.S. 837, 104 S. Ct. 2778, 81 L.E.d2d 694 (1984)
The relevant law pertained to the Clear Air Act, which required polluters in specified areas of the country to get a permit from a state regulation agency before building any new sources of pollution. Specifically, the law regulated “stationary sources” of pollution – which the EPA interpreted to include “all of the pollution-emitting devices within the same industrial group as though the plant was encased within a single bubble.” The NRDC believed “stationary” also included each individualized device that emitted pollution. The EPA’s interpretation instead meant that each individualized device would not be scrutinized as long as pollution within the entire bubble did not increase in the aggregate – in other words, a new device could be offset by a reduction in another area. The court of appeals ruled in favor of NRDC, holding that the bubble concept was inappropriate in the “the general context of a program designed to improve air quality.”
Whether deference should be given by the court to the EPA’s interpretation of statute where there is no clear guidance by Congress.
Yes. The court writes that the first thing to do when interpreting a statute is to see if Congress has given clear guidance. If not, “the question for the court is whether the agency’s answer is based on a permissible construction of the statute.” Where Congress leaves something open for interpretation it is assumed they did so intentionally for the agency to fill the gap with their own knowledge and expertise. “Such legislative regulations are given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute.” If there are conflicting policies that the agency has reconciled through their own expertise, the court will not disturb their agency’s resolution unless it is clear that Congress would not have taken the same course of action. Judges are not experts in any particular field, as an agency is.
The bubble concept is a reasonable interpretation of the statute, according to the court. “…the regulatory scheme is technical and complex, the agency considered the matter in a detailed and reasoned fashion, and the decision involves reconciling conflicting policies.” The appellate court should not review the agency’s regulation on the basis of whether or not it is reasonable or whether it is in the public interest. It should instead have reviewed whether or not the bubble concept fell within the interpretive gap left open by Congress.