From what I can see they have a very weak case and are hoping to find a sympathetic court. They propose throwing out a legislation passed by Congress in favor of legislation previously passed by the executive branch.

Let us ignore the fact that the executive branch can merely regulate in pursuance of Congressional regulation or if it is their own actions, it still holds that the more recent law supersedes the older law. They tried that vagueness claim they are so fond of but the courts exist to iron out such confusion between laws while doing to least damage to either.