Government Regulation -- 2001



United States v. Mead Corp.   (U.S. Supreme Court)

Limited deference to Customs rulings

In an 8-1 decision, the Supreme Court held 6/18/01 that a tariff classification is not entitled to judicial deference under Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), but may command appropriate respect according to its persuasiveness under Skidmore v. Swift & Co., 323 U.S. 134 (1944). The Court found that there was no indication that Congress intended to delegate to the United States Customs Service the authority to issue tariff classifications with the force of law, as evidenced by the lack of formality and procedural safeguards associated with issuance of the rulings and the fact that the rulings are not binding on third parties, and therefore the rulings were not entitled to Chevron deference. The Court held, however, that a ruling may merit some deference in proportion to its persuasive value. The Court remanded the matter to the lower courts for an assessment of whether any deference to the ruling was appropriate under the factors first recognized in Skidmore. Justice Scalia issued a vigorous dissent, concluding that the consequences of the majority opinion "will be enormous, and almost uniformly bad," for judicial review of administrative action, arguing that any authoritative or official agency rulings should be accorded Chevron deference. This ruling is important to any business that engages in federal agency litigation.