A Rough Year in Court for EPA Ends on an Undeserved Upbeat Note

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Cross-posted at WLF’s Forbes.com contributor page

The Environmental Protection Agency (EPA) has had a pretty rough 2012 in federal court. A number of lower federal courts (we detail here, here, and here) reined in the agency’s efforts to expand its authority, and in March, the Supreme Court in Sackett v. EPA unanimously held that the Clean Water Act doesn’t preclude judicial review of EPA compliance orders.

Contrary to this trend, the U.S. Court of Appeals for the D.C. Circuit gave EPA some holiday cheer on December 20, denying a rehearing en banc request in Coalition for Responsible Regulation v. EPA. In June, a three-judge panel held that EPA could regulate motor vehicle and stationary sources of six “greenhouse gases” (GHGs) under the Clean Air Act (CAA). Last Thursday’s opinions reflected a 5-2 vote against en banc rehearing, with a brief concurring statement by the three judges who issued the June ruling and two lengthy dissents from Judges Brown and Kavanaugh.

The dissents made two points: 1) The Supreme Court’s 2007, 5-4 Massachusetts v. EPA ruling, on which the June opinion relies, was wrongly decided; and 2) Mass. v. EPA doesn’t apply to regulation of GHGs from stationary sources because the definition of “air pollution” the Supreme Court applied is intertwined with the context of the case — motor vehicles or “tailpipe” emission.

Judge Brown’s typically entertaining opinion, which starts out with a riff on her student years in smoggy Southern California and finishes with a quote from Schoolhouse Rock, advances both of those points. She acknowledges that Mass. v. EPA binds the appeals court on EPA’s tailpipe GHG regulation, but she goes on to “engage[ ] Massachusetts‘s interpretive shortcomings” anyway. Considering that WLF filed an amicus brief in support of the Respondents in that case, we find Judge Brown’s criticisms to be convincing. Congress failed to pass any of the hundreds of bills meant to add GHG controls to the CAA, and the gap between the claimed pollutant and harm to human health (between which there must be a “close and tangible nexus”) is, as Judge Brown writes, “a speculative chain.”

Both Judge Brown and Judge Kavanaugh make compelling arguments that Title V of the Clean Air Act and its “Prevention of Significant Deterioration” (PSD) program don’t empower EPA to regulate stationary sources of GHG. Judge Kavanaugh argues that EPA’s sweeping definition of “air pollutant” (endorsed in Massachusetts) cannot apply for stationary sources, and posits instead that the only rational interpretation of the term is that “air pollutant” only includes six specific elements controlled by the CAA’s National Ambient Air Quality Standards (NAAQS).

In fact, EPA knew that sweeping GHGs into the PSD program was unreasonable and absurd, because it unilaterally increased the emissions limit that triggers the need for businesses to seek an emissions permit. If the limit for GHGs (which are emitted in greater quantities than other elements) was the same as for the six NAAQS pollutants, government regulators couldn’t possibly handle the resulting crush of permit requests (nor, of course, could most businesses financially handle the burden either). Despite this absurdity and EPA’s acknowledgement that the broader definition of “air pollutant” the Massachusetts Court endorsed can’t apply to stationary sources, EPA, as Judge Kavanaugh put it, “plowed ahead” anyway.

Neither Judge Brown nor Judge Kavanaugh takes issue with whether EPA can regulate GHGs under CAA Title V or the PSD program. The question to them, inherent in the Separation of Powers principles both judges embrace, is “Who Decides?” Their answer is “Congress (with the President).” Courts, like the D.C. Circuit majority in this case, undermine Separation of Powers when they allow unelected regulators to amend federal statutes and act “well beyond what Congress authorized.”

Dissents from denial of rehearing en banc such as these are written not only because judges are frustrated with their colleagues’ decisions. Judges also write them to encourage the Court above them, or Congress, to act. Judge Brown comes right out and says just that in her dissent. Clearly, as long as courts are endorsing EPA climate change regulation, Congress isn’t going to do the hard work of passing legislation. Which leaves the Supreme Court. The same four justices who dissented in Massachusetts v. EPA remain on the bench. Will the Chief and his three Associates find the D.C. Circuit judges’ dissents compelling enough to vote for cert? Perhaps. But the real question will be: can they convert the vote of a fifth justice for a majority on the stationary source GHG regulation issue?

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