ABA Challenges Appellate Court’s Reliance on Chevron Doctrine in NCUA Ruling

The American Bankers Association today filed a petition for the full D.C. Circuit Court of Appeals to review its decision in the association’s challenge of the National Credit Union Administration’s 2016 field of membership rule. In August, a three-judge panel of the court upheld much of rule while remanding a portion related to redlining concerns. The request for a rehearing by the full “en banc” panel of judges is the next step in the legal process.

ABA argued that the three-judge panel’s decision “stretches Chevron deference beyond its limits” in ruling that NCUA could define a “local community” as a combined statistical area inhabited by up to 2.5 million people or define an entire state as a “rural district.” The panel concluded that when a statute directs an agency to define a term through regulation, this act suggests that Congress did not intend the terms to be applied according to their plain meaning, whereas Supreme Court precedent holds that an agency’s authority “go[es]no further than the ambiguity will fairly allow.”

“Rehearing en banc is warranted to realign this Court’s Chevron jurisprudence with that of the Supreme Court,” ABA explained. Under the Supreme Court’s Chevron doctrine, courts defer to administrative agencies’ interpretation of statutes they administer where Congress has not specifically addressed the question at issue. ABA also said the decision was incompatible with judicial review under the Administrative Procedure Act and thus warranted review. For more information, contact ABA’s Thomas Pinder.