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The standard of review for rescinding notice and comment rules is the same as that for enacting rules. The rescission was arbitrary and capricious for failing to consider the alternative of requiring airbags and dismissing too quickly the benefits of automatic seat belts. Court membership; Chief Justice Warren E. Burger Associate Justices
When made by administrative agencies, decisions concerning mixed questions of law and fact are subjected to arbitrary and capricious review. Additionally, in some areas of substantive law, such as when a court is reviewing a First Amendment issue, an appellate court will use a standard of review called "independent review."
Accordingly, arbitrary and capricious review is understood to be more deferential to agencies than substantial evidence review is. Arbitrary and capricious review allows agency decisions to stand as long as an agency can give a reasonable explanation for its decision based on the information that it had at the time.
Citizens to Preserve Overton Park v. Volpe (1971) - Important case applying the "arbitrary and capricious" review to rule-making. Motor Vehicles Manufacturers Association v. State Farm (1983) - "arbitrary and capricious" to change rule without considering other options for the change.
Before we start merging Arbitrary, capricious and unreasonable with this I think we should discuss a bit more. The terms Arbitrary and capricious and Arbitrary, capricious and unreasonable are not just terms as per courts of the legal system but occur in tribunal settings involving lay people, eg Boards of Appeal in Universities, School Boards and labor disputes.
In Chevron, there was a two-step standard of review. The Chevron standard dealt with "a formal rationale for judicial deference to an agency's interpretation of a statute." Auer did not adopt the two-step process for review in Chevron but a single level standard of deference "to an agency's permissible interpretation of its regulation."
Intermediate scrutiny may be contrasted with "strict scrutiny", the higher standard of review that requires narrowly tailored and least restrictive means to further a compelling governmental interest, and "rational basis review", a lower standard of review that requires the law or policy be rationally related to a legitimate government interest.
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