5 USC 706: Standards, Remedies, and Post-Loper Bright Review

5 U.S.C. § 706 is the section of the Administrative Procedure Act that sets the scope of judicial review over federal agency action. It tells reviewing courts to decide all relevant questions of law, to compel action an agency has unlawfully withheld or unreasonably delayed, and to set aside agency action that fails any of six specific tests, ranging from arbitrary decision-making to constitutional violations to procedural shortcuts.¹ After the Supreme Court’s 2024 decision in Loper Bright Enterprises v. Raimondo, which overruled Chevron deference, the statute matters more than ever, because courts now exercise independent judgment on the legal questions § 706 puts in front of them rather than deferring to the agency’s reading.²

What Section 706 Actually Says

Section 706 sits inside Chapter 7 of the APA, the chapter Congress devoted to judicial review of agency action.³ It opens by putting the reviewing court, not the agency, in charge of the legal questions: the court decides all relevant questions of law, interprets constitutional and statutory provisions, and determines the meaning or applicability of the terms of an agency action.

Two operative commands follow. First, the court must compel agency action unlawfully withheld or unreasonably delayed. If a statute obligates an agency to do something and the agency refuses or stalls, the court can order it to move. Second, the court must hold unlawful and set aside agency action, findings, and conclusions found to be:

arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;
contrary to constitutional right, power, privilege, or immunity;
in excess of statutory jurisdiction, authority, or limitations, or short of statutory right;
without observance of procedure required by law;
unsupported by substantial evidence in cases subject to formal hearing procedures under 5 U.S.C. §§ 556 and 557 or otherwise reviewed on the record of an agency hearing provided by statute; or
unwarranted by the facts to the extent that the facts are subject to trial de novo by the reviewing court.

In making these determinations, the court reviews the whole record or those parts of it cited by a party, and it applies the rule of prejudicial error: a procedural slip that changed nothing in the outcome does not by itself invalidate an otherwise sound decision.⁴

The Standards Courts Apply

The six grounds are not applied with equal intensity. The type of agency decision under challenge dictates the standard, and choosing the wrong one is one of the fastest ways to lose.

Arbitrary and Capricious

This is the workhorse standard for informal rulemaking and most discretionary agency decisions. Under Motor Vehicle Manufacturers Association v. State Farm (1983), an agency must examine the relevant data and offer a satisfactory explanation connecting the facts it found to the choice it made. An action fails when the agency relied on factors Congress didn’t intend it to consider, ignored an important aspect of the problem, offered a rationale that runs counter to the evidence, or reached a conclusion so implausible it can’t be attributed to a difference in expert view.

The Supreme Court applied this in Department of Homeland Security v. Regents of the University of California (2020), setting aside the rescission of DACA because the agency had not considered whether to keep parts of the program while ending others and had not weighed the reliance interests of people who had built lives around it.⁵ Agencies changing course from a prior position face extra scrutiny: they must acknowledge the change and give reasons for it, not act as if the old policy never existed.

Substantial Evidence

This standard applies when the agency built its decision on a formal record, meaning the hearing procedures in 5 U.S.C. §§ 556 and 557 or a comparable process required by statute.⁴ The Supreme Court in Universal Camera Corp. v. NLRB (1951) described substantial evidence as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, and it directed courts to look at the whole record, including the evidence pointing the other way.⁶

Constitutional Violations

When the challenge is that an agency violated the Constitution, courts decide the question independently, without giving the agency the benefit of the doubt. Section 706(2)(B) directs courts to set aside action contrary to constitutional right, power, privilege, or immunity. In FCC v. Fox Television Stations (2012), the Court found the FCC had violated due process by punishing broadcasters under indecency standards that gave them no fair notice their content would be sanctioned.⁷

Procedural Compliance

Section 706(2)(D) lets courts set aside action taken without observance of procedure required by law. The APA’s own notice-and-comment requirements are the most common example: an agency proposing a rule must publish notice, take public comments, and explain the basis and purpose of the final rule.⁸ A final rule must also be a logical outgrowth of what the agency proposed. If it strays so far that commenters had no meaningful chance to weigh in on what the agency actually adopted, a court can invalidate it for inadequate notice.

How Courts Handle Agency Legal Interpretations After Loper Bright

For almost forty years, courts followed Chevron: if a statute was ambiguous and the agency’s reading was reasonable, the court accepted it. That framework is gone. In Loper Bright Enterprises v. Raimondo (2024), the Supreme Court held that the APA requires courts to exercise independent judgment when deciding whether an agency has acted within its statutory authority. Ambiguity is no longer a delegation to the agency.²

Agency expertise still has a role. Consistent with Skidmore v. Swift & Co. (1944), a court can look to an agency’s interpretation for guidance, with the weight depending on how thoroughly the agency considered the question, how sound its reasoning is, and how consistent the interpretation has been over time. A well-developed, stable agency position remains persuasive; an unexplained flip does not.²

The Major Questions Doctrine

Alongside Loper Bright, the major questions doctrine narrows the space agencies can occupy on their own. In West Virginia v. EPA (2022), the Supreme Court held that when an agency claims power to make decisions of vast economic and political significance, courts should not assume Congress granted that power through vague or rarely used statutory language. The agency has to point to clear congressional authorization.⁹ The Court applied this to the EPA’s Clean Power Plan, finding the agency had leaned on a gap-filler provision to restructure the energy sector.

When Section 706 Doesn’t Apply

Not every agency choice can be reviewed under § 706. Two limits matter most.

The first comes from 5 U.S.C. § 701(a): judicial review is unavailable when a statute precludes it or when the action is committed to agency discretion by law.¹⁰ The classic example is an agency’s decision not to pursue an enforcement action. In Heckler v. Chaney (1985), the Supreme Court held those decisions are presumptively unreviewable because they involve balancing resources, priorities, and strategy in ways courts are poorly positioned to second-guess. The presumption flips when a statute says the agency shall act on specified conditions; Massachusetts v. EPA (2007) applied that logic to force the EPA to make the endangerment finding on greenhouse gases that the Clean Air Act required.¹¹

The second limit is on what the court looks at. Section 706 tells courts to review the whole record or the parts cited, and courts generally hold themselves to the administrative record that existed when the agency decided.⁴ New evidence, fresh expert reports, and after-the-fact testimony are usually off limits. Extra-record review requires a strong showing of bad faith or improper behavior. Department of Commerce v. New York (2019), where the Court looked past the record after finding the citizenship-question rationale pretextual, remains the outer edge, not the norm.

What a Court Can Actually Do

Finding a violation is only half the case. The remedy decides what changes.

Vacatur and Remand

The most common remedy is vacatur paired with remand: the court strikes the unlawful action and sends the matter back to the agency. That was the outcome in DHS v. Regents, where the DACA rescission went back for a proper analysis.⁵ Courts sometimes remand without vacatur when the flaw looks fixable and pulling the action immediately would cause serious disruption. They weigh how serious the defect is against how much damage vacatur would do in the meantime.

Injunctions

A court can enjoin an agency from enforcing an unlawful rule or policy. Preliminary injunctions may issue before final judgment when the challenger shows a likelihood of success and irreparable harm. Nationwide injunctions from district courts have become a recurring feature of high-profile APA litigation.

Compelled Agency Action

Under § 706(1), a court can order an agency to perform a duty it has unlawfully withheld. The reach of that power is narrow. In Norton v. Southern Utah Wilderness Alliance (2004), the Supreme Court held a court can compel only a discrete agency action the agency is legally required to take. Broad orders directing an agency to run a program differently are outside § 706(1); the required action has to be specific and mandatory.¹²

Stays Pending Review

Under 5 U.S.C. § 705, the agency can postpone the effective date of its own action pending review when justice requires, and a court can issue whatever process is necessary to prevent irreparable injury while the case proceeds.¹³

What Section 706 Won’t Get You

Money damages, in almost every case. Section 702 waives sovereign immunity for suits seeking relief other than money damages.¹⁴ Financial compensation for harm caused by an agency has to come through a different statute, such as the Tucker Act or the Federal Tort Claims Act, each with its own jurisdictional rules.

Threshold Requirements Before a Court Reaches Section 706

A court will not touch the § 706 analysis until several gatekeeping questions are answered.

Standing and adverse effect. Section 702 gives a right to review to a person suffering a legal wrong because of agency action or adversely affected or aggrieved by agency action within the meaning of a relevant statute.¹⁴ Article III adds an injury that is actual or imminent, traceable to the agency, and likely to be redressed by a favorable decision.¹⁵ The plaintiff’s interests must also fall within the statute’s zone of interests, a test the Court refined in Bennett v. Spear (1997).¹⁶

Final agency action. Review is generally available only for final action. Under Bennett v. Spear, action is final when the agency’s decision-making process has ended and legal consequences flow from it.¹⁶ Pre-enforcement challenges are sometimes possible under the ripeness framework of Abbott Laboratories v. Gardner (1967), which lets a court hear a challenge when the legal issues are fit for review and delay would work hardship on the parties.¹⁷

Exhaustion. You usually have to run any agency appeal to the end first, but not always. In Darby v. Cisneros (1993), the Supreme Court held that federal courts cannot impose exhaustion on their own; the requirement applies only when a statute or the agency’s own rules mandate the internal appeal and make the initial decision inoperative until it is resolved.¹⁸

Time to sue. The default deadline for suing the federal government is six years from when the right to sue first arises, under 28 U.S.C. § 2401(a), unless another statute sets a different period.¹⁹ When the clock starts can be its own hard question when the effects of an agency action unfold over time.

1
Office of the Law Revision Counsel. 5 USC 706 – Scope of Review
2
Supreme Court of the United States. Loper Bright Enterprises v. Raimondo
3
Office of the Law Revision Counsel. 5 USC Ch. 7 – Judicial Review
4
Office of the Law Revision Counsel. 5 U.S. Code 706 – Scope of Review
5
Supreme Court of the United States. Department of Homeland Security v. Regents of the University of California
6
Cornell Law Institute. Universal Camera Corp. v. NLRB, 340 U.S. 474
7
Cornell Law Institute. FCC v. Fox Television Stations, Inc., No. 10-1293
8
Office of the Law Revision Counsel. 5 USC 553 – Rule Making
9
Supreme Court of the United States. West Virginia v. EPA
10
Office of the Law Revision Counsel. 5 USC 701 – Application and Definitions
11
U.S. Reports. Massachusetts v. EPA, 549 U.S. 497
12
Justia U.S. Supreme Court Center. Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55
13
Office of the Law Revision Counsel. 5 U.S. Code 705 – Relief Pending Review
14
Office of the Law Revision Counsel. 5 U.S. Code 702 – Right of Review
15
Legal Information Institute. Standing Requirement – Overview
16
Justia U.S. Supreme Court Center. Bennett v. Spear, 520 U.S. 154
17
Justia U.S. Supreme Court Center. Abbott Laboratories v. Gardner, 387 U.S. 136
18
Law.Cornell.Edu. Darby v. Cisneros
19
Office of the Law Revision Counsel. 28 U.S. Code 2401 – Time for Commencing Action Against United States