Post-Chevron era will require industry, agency collaboration to navigate uncertainty

The Chevron doctrine, established by the US Supreme Court in the 1984 case Chevron U.S.A., Inc. v. Natural Resources Defense Council Inc.​,​ mandated that courts should defer to federal agencies' reasonable interpretations of statutes they administer. The law was overturned on June 28 in the case Loper Bright Enterprises v. Raimondo​​ potentially sparking significant implications for regulatory agencies.

“Without the Chevron doctrine, there will be greater uncertainty,” said Todd Van Thomme, registered patent attorney and shareholder in Nyemaster Goode’s intellectual property department and member of the food laws and regulations division at the Institute of Food Technologists (IFT).

“Companies may decide to argue interpretations from certain agencies of the government are incorrect. This will likely lead to more lawsuits against FDA, USDA and other governmental regulatory agencies,” in addition to a greater need “for more legislative clarity in the statutory process to make clear for what is intended under the law,” Van Thomme told FoodNavigator-USA.

Van Thomme predicts that the Supreme Court’s decision most likely will result in “a more rigorous judicial review of regulations” and possibly result in “regulations being modified or overturned.” Due to courts interpreting regulations differently, this may create a “divergent patchwork of regulatory rules where regulation may depend on the jurisdiction.”

“The overturn of the Chevron doctrine could lead to increased uncertainty and variability in how food safety regulations are interpreted and enforced across different states. With states already implementing varying bans on food additives​ and regulations concerning emerging technologies like cultivated meat​, the absence of Chevron deference may exacerbate this fragmentation,” Ryan Osterholm, a food safety lawyer for OFT Law, told FoodNavigator-USA.

Strategies to navigate a fragmented regulatory system ​

The potential for patchwork regulations may lead to companies bolstering their legal departments and establish experts “in various jurisdictions,” Van Thomme said.

“Overall, the uncertainty will no doubt result in companies needing to invest more in people with legal expertise to both comply with and challenge new regulations as non-compliant with the statutory law,” he said.

Matthew Allen, senior director of food and sustainability advisory solutions at NSF, echoed these sentiments to FoodNavigator-USA, adding CPG companies should “proactively engage expertise in advance” and “horizon scan for regulations” to update internal production, retail and supply chain risk management decisions and processes.

“Regarding CPG companies, this could include rules around labeling requirements and ingredient bans. As regulations may vary from state to state, companies should prioritize regulatory compliance through internal staffing and/or working with a third-party partner,” Allen added.

Voluntary guidance will need ‘more legislative clarity’​

Voluntary guidance, including nutritional labeling and sodium reduction, will also “have a reduced influence in legal proceedings,” if courts choose to interpret laws without agency input, Van Thomme explained.

This potentially could lead to a “shift in compliance strategies and a greater emphasis on statutory requirements,” which will require more “legislative clarity,” he said.

Van Thomme suggests that companies participate actively in legislative processes and support clear and workable laws, while government agencies should “focus more on formal rule making rather than issuing contrary guidelines” as “courts might not automatically defer to the agency’s informal guidance” with the possibility for more rigorous regulations. He also suggested that companies could align their business practices “more closely with industry standards and best practices to mitigate risks.”

Product liability is expected to increase accountability for industry​

Product liability is likely to increase food safety accountability in the industry as some companies may choose to challenge federal regulations and best practices, Osterholm said.

The threat of litigation may be the most effective way to ensure food safety, but it comes at a high cost to consumers who become severely ill, are hospitalized or die, Osterholm said.

By advocating for victims of foodborne illnesses, lawyers can promote stricter adherence to food safety regulations and better transparency in labeling and production practices. This accountability helps victims seek justice and drives improvements in the food system by incentivizing companies to prioritize safety and compliance, he said.

“Unfortunately, if there is a decrease in food safety regulations because of this decision, we will see more outbreaks and more people will become sick and die. If that occurs, food companies should prepare for increased scrutiny and potential litigation following this change,” Osterholm said.

He suggested that companies should curtail this risk by complying with existing food safety regulations and ensuring that robust risk management protocols are in place.

“Engaging with food safety experts to conduct regular audits and assessments of production processes can also help identify and address potential vulnerabilities before they lead to legal challenges. Ultimately, by prioritizing consumer safety and transparency, food companies can navigate the evolving regulatory landscape more effectively while maintaining consumer trust and loyalty,” Osterholm said.

How can companies adapt to an ‘unpredictable regulatory environment’?​

Companies need to adjust their long-term strategy to navigate the “likely unpredictable regulatory environment that will probably result from the overturning of the Chevron doctrine,” and engage more actively in the legislative process, said Van Thomme.

He suggests that companies continuously monitor and train on “the latest regulatory developments and court rulings.”

This includes a multi-tiered approach from establishing a system for continuous monitoring of regulatory changes and judicial decisions and participating in trade and scientific organizations that are actively engaged and communicating in the regulatory space to collaborating with industry groups and statutory outcomes to ensure industry perspectives are considered.

Opportunity for increased collaboration between food industry and regulatory agencies​

Increased collaboration between food industry and regulators may be necessary in a post-Chevron era, especially because the court’s scrutiny of agency interpretations will lead to “greater uncertainty,” Van Thomme opined.

Collaboration would lead to “enhanced understanding between [both parties] … [to] more effectively align on regulatory intentions and practical applications,” which could help reduce misinterpretations, Van Thomme said. He added: Collaboration could also lead to “proactive problem solving” to “more effectively align on regulatory intentions and practical applications … thereby reducing misinterpretations,” and adopt uniform standards to improve long-term planning around regulatory uncertainty.

Van Thomme suggests enhancing collaboration by forming committees for ongoing communication and joint problem-solving, engaging in joint research and development and holding regular stakeholder meetings with industry, regulators, consumer groups and academia.

Collaboration could improve public trust in both parties, he said.

“Demonstrating a cooperative approach can boost consumer confidence​ in both industry practices and regulatory oversight,” he added.

He continued, “Generally speaking, increased collaboration in the aftermath of the decision removing the Chevron doctrine, if undertaken, can ensure clearer, more effective regulations that protect consumers and provide stability for the industry. By working together, regulatory agencies and the food industry can facilitate a more predictable regulatory environment, but only if both segments seize the opportunity to collaborate and do so.”