Debit Card Fee Rule a New Challenge for Justices on Agency Power

The US Supreme Court will consider a disagreement over the deadline for businesses and individuals to challenge administrative rules and actions, adding to its agency-focused docket.

The case the justices agreed to take up Friday centers on the timing of a lawsuit over a 2011 rule regulating debit-card transaction fees. Retailers have been fighting the Federal Reserve regulation for years, claiming the fees charged by banks are unfair.

The US Court of Appeals for the District of Columbia Circuit rejected an industry challenge to the rule shortly after it was adopted. The Supreme Court agreed to review that ruling.

The current case doesn’t go to the heart of the fee controversy, but instead focuses on the timeliness of challenging the rule.

The outcome, depending on how the court rules, could clear the way for challenges to regulations years or even decades after they take effect.

In 2021, the Corner Post truck stop and convenience store in Watford City, North Dakota, joined a suit that again challenged the fee rule on largely the same grounds previously rejected by the DC Circuit.

The Eighth Circuit, where the Corner Post challenge was brought, dismissed the case. It noted the six-year statute of limitations set out in the Administrative Procedure Act for challenging final agency action.

Corner Post, however, wasn’t opened until 2018—one year after the Eighth Circuit’s deadline. The business couldn’t have asserted any legal harm from the rule necessary to bring a challenge, its brief urging the justices to take up the case said.

The question for the justices is whether the limitations period begins to run when the rule is finalized, as the Eighth Circuit held, or when the business suffers harm.

The conservative-majority has focused on reining in the so-called administrative state. This term, the justices also will hear challenges to the Consumer Financial Protection Bureau’s funding structure and a bedrock principle that requires courts to defer to agency interpretation of ambiguous statutes—the Chevron Doctrine.

The case is Corner Post v. Board of Governors of the Federal Reserve System, U.S., No. 22-1008.