Trump administration continues deregulation push

The Trump administration is continuing its deregulatory push across the federal government. Its latest directive has some stakeholders worried agencies will soon start repealing existing regulations in conflict with law and face legal challenges as a result.

An April 9 memorandum from President Donald Trump is “teeing up massive rollbacks of regulations across the entire government without following the primary procedural protection to ensure fair action,” said Robert Weissman, co-president of Public Citizen, a nonprofit consumer advocacy group. “They're suggesting agencies should proceed on a hyper-aggressive regulatory rollback agenda without following standard notice and comment for regulatory action.”

Trumo in the memo directed heads of federal agencies to evaluate each existing regulation’s lawfulness with respect to 10 recent U.S. Supreme Court decisions. Those decisions include one from June that significantly weakened regulatory agencies' ability to interpret federal laws (Loper Bright Enterprises vs. Raimondo), and a 2015 decision that declared the Environmental Protection Agency must consider economic costs when issuing regulations (Michigan vs. EPA).

If a regulator starts repealing rules as instructed in the memo, Weissman said the administration will be taken to court.

“When the agencies actually do something, those actions will be susceptible to legal challenge, and this memo certainly suggests it's teeing up a huge number of regulatory rollbacks,” he said. “And if that occurs, I would expect a huge number of lawsuits challenging them.”

Trump in the memo instructed the agencies to repeal rules determined to be in conflict with Supreme Court decisions without the “notice and comment” period required by the Administrative Procedure Act, citing an provision laid out in the law known as the “good cause” exception.

“Notice-and-comment proceedings are ‘unnecessary’ where repeal is required as a matter of law to ensure consistency with a ruling of the United States Supreme Court,” Trump wrote. “Agencies thus have ample cause and the legal authority to immediately repeal unlawful regulations.”

Varu Chilakamarri, a partner in law firm K&L Gates' environment, land, and natural resources practice group and former litigator at the Department of Justice, explained that the good cause exception has historically been used on a case-by-case basis and not categorically like the president is suggesting.

She also noted that the president’s memo is quite broad in that it doesn’t focus on a particular industry or statutory regime. The agencies’ reviews could sweep up a wide range of rules, like ones interpreted to have exceeded an agency’s authority or those that were inadequately explained, she added.

The memo will likely spur lawsuits, according to Chilakamarri. Anytime an agency rescinds a rule, “There’s going to be folks who are benefiting from that rule who are at least going to seriously consider challenging it, but it will by case by case,” she said.

Exactly how the agency heads will respond to Trump’s directive remains to be seen.

Securities and Exchange Commission Chair Paul Atkins was officially confirmed by the Senate on April 9 and is expected to bring a lighter regulatory touch to the job than his predecessor, Gary Gensler.

At the Department of Labor, Lori Chavez-DeRemer was sworn in as Labor secretary in March, but the DOL’s Employee Benefits Security Administration is still without a Trump-appointed leader as nominee Daniel Aronowitz awaits his Senate confirmation hearing.

With respect to EBSA, experts expect the DOL’s Biden-era fiduciary investment advice rule to be killed one way or the other — either in court or through a DOL repeal. Republicans broadly do not support the rule. On April 15, a federal appeals court granted the Trump administration's request for more time to review a consolidated lawsuit seeking to overturn the rule.

“They could repeal if they wanted to, or at least start that process,” said Michael Kreps, a partner at Groom Law Group, about the DOL’s Retirement Security Rule, which was finalized in April 2024 and, among other things, changed the five-part test so one-time advice, such as rollovers to IRAs or annuity purchases, must be in an investor’s best interest. “I don't know what they're going to do strategically, but that would be the big one,” Kreps said.

But on the whole, Kreps interprets Trump’s April 9 memo as narrower, noting that the list of Supreme Court decisions highlighted will apply only in certain circumstances.

“I read it more as like a statement of policies, that direct agencies to go back and look at rulemakings, coupled with a recognition that in some cases they may not need to go to the (Administrative Procedure Act) comment process where that whole process would be futile, because the reg is plainly on its face illegal,” Kreps said. “But it seems like it’s going to be a fairly narrow range of regs that qualify for that type of process.”

Regardless, Trump’s April 9 memo continues the new administration’s desire to shrink the federal government, sources said.

Two days after the memo, the White House’s Office of Management and Budget on April 11 issued a public request for information seeking “ideas for deregulation from across the country.”

Both moves follow an executive order signed by Trump in February in which he directed agency heads to review existing regulations and suggest rules to be cut that fall into one of several broad categories. The categories include rules that “implicate matters of social, political or economic significance that are not authorized by clear statutory authority,” or regulations that “impose significant costs upon private parties that are not outweighed by public benefits.”

The president directed the agencies to work with Elon Musk’s Department of Government Efficiency and Russell Vought, the director of the Office of Management and Budget, as part of the administration’s effort to “commence the deconstruction of the overbearing and burdensome administrative state.”

Trump in the Feb. 19 order gave agency directors 60 days to complete their reviews; the deadline is April 20.

While it’s clear the Trump administration is motivated to reduce the number of regulations on the books, the next steps are less certain, Kreps said.

“Is this performative in that this is just another step for the White House to show that it's deregulating?” Kreps said. “There’s value in performative gestures. Or do they really believe that there are some … rules that they could rescind without notice-and-comment rulemaking? If so, what’s the scope going to be of that? What's that going to look like? And I don't think we have any answers to that yet.”