It wasn’t until the very end of her rebuttal time in BNSF Railway Company v. Loos on Tuesday morning that BNSF Railway’s counsel, Lisa Blatt, finally mentioned the dreaded C-word. “I hate to cite it, but I will end with Chevron,” Blatt told the justices. “I mean, [the respondent] has to win under the plain language for you to affirm.”

“Chevron,” of course, refers to Chevron U.S.A. v. Natural Resources Defense Council, the 1984 case that held that federal courts should defer to an agency’s reasonable interpretation of an ambiguous statute that it administers. It’s a decision that has emerged as a lightning rod for criticism in recent years — including from the justices themselves. Justice Clarence Thomas has written that “Chevron deference raises serious separation-of-powers questions”; Justice Neil Gorsuch has suggested that the Chevron is “a judge-made doctrine for the abdication of judicial duty”; and Justice Brett Kavanaugh has expressed his own doubts about Chevron deference. There do not appear to be five votes to jettison Chevron just yet, but yesterday’s argument augurs a fate that is, in some ways, even worse: Sophisticated litigants may simply ignore Chevron even if the justices do not formally overrule the decision.

If not for the writing on the wall with respect to Chevron, one might have thought that the deference doctrine would have been among BNSF Railway’s best arguments. The question in the case is whether a payment to a railroad employee for lost wages on account of a personal physical injury is subject to employment taxes under the Railroad Retirement Tax Act. BNSF says “yes”; respondent Michael Loos argues “no”; and the statute in its current form says nothing specifically with regard to lost wages. Meanwhile, a 1994 IRS regulation states that “pay for time lost” is taxable under the RRTA — an interpretation that clearly favors BNSF. As long as the statute is ambiguous and the IRS’s interpretation is reasonable, then the Chevron doctrine would seem to be outcome-determinative.

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