The Supreme Court made it easier to challenge federal regulations by ruling Monday that the six-year limitations period under the Administrative Procedure Act doesn’t start running until a plaintiff is harmed by a regulation.
In an ideologically aligned 6-3 decision, the court’s conservative majority ruled that the statute of limitations does not start to run “until a plaintiff is ultimately injured by an agency action.”
The Biden administration argued that the deadline would start when the agency in question issues a rule, creating a standard that could block many challenges.
The court’s decision marks a victory for Corner Post, a North Dakota truck stop that had challenged a 2011 Federal Reserve regulation that capped debit card “swipe fees” paid by stores that accept card payments.
The ruling overturned a lower court’s decision to dismiss the lawsuit as outside the statute of limitations.
Cornerpost argued that the Fed set a higher limit than the “reasonable” limit set by the Dodd-Frank Act of 2010. The truck stop didn’t open until 2018, seven years after the Fed’s regulation, so it argued it could still sue.
This represents another victory for anti-regulation advocates, dealing yet another blow to the ever-expanding “administrative state.”
Justice Ketanji Brown Jackson read a dissenting opinion for the court, a practice that highlights sharp differences of opinion on an issue.
“Never mind that in the administrative law context, the statute of limitations uniformly begins to run from the time of the administrative agency’s action. Never mind that the plaintiff’s injury is entirely unrelated to the ostensible APA claim. All of this must be ignored, because, according to the Court, for other types of claims, accrual begins to run from the time of the plaintiff’s injury,” Jackson wrote in dissent.
“The majority refuses to accept the simple, common-sense, and only reasonable interpretation of the statute of limitations enacted by Congress. In doing so, the Court is wreaking havoc on government agencies, businesses, and society at large.”
The National Retail Federation (NRF), which is not a party to the case but has fought to increase competition in the credit card interchange market, welcomed the ruling.
“At the end of the day, small businesses harmed by flawed regulations should not be denied hearing in court, especially on disputed technical grounds,” said Stephanie Martz, NRF’s chief administrative officer and general counsel, who was originally co-counsel on the case.
“The Federal Reserve set the cap much higher than Congress intended, causing stores like The Corner Post to overpay by millions of dollars and, in turn, raising prices for customers. This harm has continued and has not changed over time. The Supreme Court correctly decided to allow this case to be decided on its merits.”
Updated at 10:21 a.m. ET.
