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American Road & Transportation Builders Association v. Environmental Protection Agency et al

June 7, 2012

AMERICAN ROAD & TRANSPORTATION BUILDERS ASSOCIATION, PLAINTIFF,
v.
ENVIRONMENTAL PROTECTION AGENCY ET AL., DEFENDANTS.



The opinion of the court was delivered by: Rudolph Contreras United States District Judge

MEMORANDUM OPINION

For the last ten years, the American Road and Transportation Builders Association ("ARTBA") has sought to alter the regulations implementing section 209(e) of the Clean Air Act. The Environmental Protection Agency ("EPA") has consistently denied its petitions. In 2009, the D.C. Circuit dismissed a challenge to one such denial; two other challenges are currently pending in the courts of appeals. ARTBA now asks this court to review the EPA's denial of its petitions. But only the courts of appeals may review final action taken under the Clean Air Act, see 42 U.S.C. § 7607(b)(1), and so this court dismisses the case for lack of subject matter jurisdiction.

I. BACKGROUND

In 1990, Congress amended the Clean Air Act to authorize the federal regulation of emissions from nonroad engines,*fn1 which power vehicles and mobile equipment from lawnmowers to locomotives. Pub. L. No. 101-549, § 213, 104 Stat. 2399, 2500 (codified at 42 U.S.C. § 7547). At the same time, in section 209(e) of the amended Act, Congress preempted state regulation of such emissions. 42 U.S.C. § 7543(e). Section 209(e)(1) prohibits states from adopting or enforcing "any standard or other requirement relating to the control of emissions" from "new" locomotives or their engines or "new" engines below a certain horsepower that are used in farm or construction vehicles or equipment. Id. § 7543(e)(1). That bar is absolute, but section 209(e)(2) requires the EPA under certain conditions to "authorize California to adopt and enforce standards and other requirements relating to the control of emissions" from nonroad engines and vehicles not named in section 209(e)(1). Id. § 7543(e)(2)(A). Other states can then opt in to the California standards. Id. § 7543(e)(2)(B).

In 1994, the EPA published two regulations interpreting the preemptive scope of section 209(e). One regulation-the "preemption rule"-defined statutory terms and clarified the class of preempted state law, see Preemption of State Regulation for Nonroad Engine and Vehicle Standards, 59 Fed. Reg. 36,969, 36,986--87 (July 20, 1994) ("1994 Preemption Rule") (codified at 40 C.F.R. § 85.1602--03 (1995)), while the other-the "interpretive rule"-emphasized the types of state regulation that were permitted without federal authorization, see Emission Standards for New Nonroad Compression-Ignition Engines At or Above 37 Kilowatts, 59 Fed. Reg. 31,306, 31,339--40 (June 17, 1994) ("1994 Interpretive Rule") (codified at 40 C.F.R. § 89 subpt. A, App'x A (1995)). The agency's rationales for the two regulations were nearly identical. Compare id. at 31,328--31 with 1994 Preemption Rule, 59 Fed. Reg. at 36,971--74. In justifying both the preemption rule and the interpretive rule, the EPA acknowledged the "clear preemption of state regulation of nonroad engines . . . in section 209(e)(1)" and determined that, although "[t]he language of section 209(e)(2) does not state any clear preemption," some preemption was nonetheless implied.*fn2 The agency further "noted that section 209(e)(2) of the Act does not prevent California or other states from regulating nonroad engines and vehicles in use," and stated its belief that "the requirements of section 209(e)(2) apply only to new nonroad engines and vehicles." 1994 Interpretive Rule, 59 Fed. Reg.at 31,330 (emphases added); 1994 Preemption Rule, 59 Fed. Reg. at 36,973 (same). The preemption rule therefore provided that no state could "enforce any standards or other requirements relating to the control of emission[s] from new nonroad engines or vehicles" unless California was first authorized to enforce them. 1994 Preemption Rule, 59 Fed. Reg. at 36,987 (codified at 40 C.F.R. § 85.1603(d) (1995)) (emphasis added). It defined a "new" engine or vehicle as one which has neither been "placed into service" nor had its "equitable or legal title . . . transferred to an ultimate purchaser."*fn3 The interpretive rule described the EPA's understanding of "in-use" regulations:

EPA believes that states are not precluded under section 209 from regulating the use and operation of nonroad engines, such as regulations on hours of usage, daily mass emission limits, or sulfur limits on fuel; nor are permits regulating such operations precluded once the engine is placed into service or once the equitable or legal title to the engine or vehicle is transferred to an ultimate purchaser, as long as no certification, inspection, or other approval related to the control on emissions is required as a condition precedent to the initial retail sale, titling, or registration of the engine or equipment. 1994 Interpretive Rule, 59 Fed. Reg. at 31,339 (codified at 40 C.F.R. § 89 subpt. A, App'x A (1995)).

An industry group challenged the preemption rule's definition of "new" and its limitation of section 209(e)(2)'s preemptive effect to new nonroad engines, as well as the interpretive rule's assertion that section 209(e)(2) did not preempt state regulation of the use of nonroad engines. Engine Mfrs. Ass'n v. EPA, 88 F.3d 1075 (D.C. Cir. 1996) ("EMA"). This suit was brought in the D.C. Circuit under Clean Air Act § 307(b)(1), which provides that review of "nationally applicable regulations promulgated" under the Act "may be filed only in the United States Court of Appeals for the District of Columbia." 42 U.S.C. § 7607(b)(1) (emphasis added). The D.C. Circuit upheld the definition of "new," ruling that the statutory term was ambiguous and the agency's interpretation permissible. EMA, 88 F.3d at 1087. Turning to the question "whether, as the EPA decided, only new nonroad sources are covered by § 209(e)(2), or, as [the industry group] argue[d], both new and non-new sources are covered," id. at 1088, the court concluded that Congress had spoken to the issue by omitting the word "new" from § 209(e)(2), see id. at 1087--93. The agency's attempt to limit the scope of the provision was therefore barred by the statutory text. Id. at 1093. Having established "which nonroad sources the states are preempted from regulating," the Circuit addressed the question of "what sorts of regulations the states are preempted from adopting," id., upholding the EPA's determination that section 209(e)(2) did not preempt state regulation of the use of nonroad engines. Id. at 1094.

The EPA revised its regulations to conform to the Circuit's decision in EMA. See Preemption of State Regulation for Nonroad Engine and Vehicle Standards; Amendments to Rules, 62 Fed. Reg. 67,733, 67,735 (Dec. 30, 1997) ("Amendments to Rules") ("Today's direct final rule implements the opinion of the Court regarding the scope of preemption of section 209(e)(2) by amending the language of the implementing regulations to reflect that California must request authorization for its emissions standards and other related requirements for all nonroad vehicles and engines.") (emphasis added). The agency removed the word "new" from the preemption rule's description of the engines whose emissions could not be regulated without federal approval, see id. at 67,736 (amending 40 C.F.R. § 85.1603(d)), and revised the language of the interpretive rule's "determination that states are not precluded from regulating the use of nonroad engines," id. at 67,734.

In 2002, ARTBA petitioned the EPA to amend its regulations. Petition to Amend Rules Implementing Clean Air Act § 209(e), EPA Docket HQ-OAR-2004-0008, Doc. 531 (July 12, 2002) ("Petition to Amend Rules"). The association asked the agency to declare that certain types of state regulation which the revised interpretive rule*fn4 listed as permissible were in fact preempted by section 209(e), along with other types of regulation not discussed in the extant rules. Petition to Amend Rules at 1. ARTBA criticized the research and reasoning of the EMA decision at some length and identified allegedly untenable distinctions introduced by an amendment to the preemption rule dealing with locomotives. Id. at 3 (discussing Emissions Standards for Locomotives and Locomotive Engines, 63 Fed. Reg. 18,978, 18,998 (Apr. 16, 1998) (amending 40 C.F.R. § 85.1602--03)). ARTBA also noted that it had successfully challenged a Texas regulation as preempted by section 209(e). Id. at 1 (describing the holding of Engine Mfrs. Ass'n v. Huston, 190 F. Supp. 2d 922 (W.D. Tex. 2001), vacated (5th Cir. Mar. 5, 2002) and dismissed as moot (5th Cir. May 14, 2002)). After the Supreme Court's decision in Engine Manufacturers Association v. South Coast Air Quality Management District, 541 U.S. 246 (2004), ARTBA argued in an email to the EPA that the new precedent compelled the agency to grant the regulatory revisions that the association was seeking. ARTBA Petition, EPA Docket HQ-OAR-2004-0008, Doc. 532 (Apr. 30, 2004).

The EPA put ARTBA's petition out for comment in 2007, see Control of Emissions from Nonroad Spark-Ignition Engines and Equipment, 72 Fed. Reg. 28,098, 28,209--10 (May 18, 2007), and rejected it the following year, see Control of Emissions From Nonroad Spark-Ignition Engines and Equipment, 73 Fed. Reg. 59,034, 59,130 (Oct. 8, 2008) ("After reviewing ARTBA's petition and the comments received regarding the petition, EPA is not adopting the changes requested by ARTBA in its petition.").*fn5 The agency explained that "although EPA does agree in part with ARTBA's interpretation, EPA does not believe it is necessary or appropriate to revise its regulations based on ARTBA's petition." Response to the Petition of ARTBA to Amend Regulations Regarding the Preemption of State Standards Regulating Emissions from Nonroad Engines, EPA Docket HQ-OAR-2004-0008, Doc. 921, at 11 (Aug. 21, 2008). Where the EPA agreed that certain forms of state regulation unmentioned in its regulations were in fact preempted by section 209(e), it nonetheless concluded that "the regulations as written are sufficient and need not be revised" to make that preemption explicit. Id. at 1. And the EPA maintained its position that, contrary to ARTBA's reading of the statute, "Congress did not intend to preempt state and local regulation of the use and operation of nonroad engines under section 209(e) of the Clean Air Act." Id. at 27 (abbreviation expanded).

ARTBA challenged the denial of its petition before the D.C. Circuit. ARTBA v. EPA, 588 F.3d 1109 (D.C. Cir. 2009). This challenge was also brought directly to that court under Clean Air Act § 307(b)(1), which provides that petitions for review of regulations promulgated under the Act "shall be filed within sixty days from the date notice of such promulgation . . . appears in the Federal Register," unless the "petition is based solely on grounds arising after such sixtieth day." 42 U.S.C. § 7607(b)(1). The Circuit held that ARTBA's suit was an untimely attack on the 1997 re-promulgation of the preemption and interpretive rules rather than a timely challenge to the EPA's denial of its 2008 petition because Clean Air Act § 307(b)(1) enacted an exception to "[t]he general rule . . . that it is a perfectly valid 'method of obtaining judicial review of agency regulations once the limitations period has run . . . to petition the agency for amendment or rescission of the regulations and then to appeal the agency's decision.'" ARTBA, 588 F.3d at 1112 (quoting NLRB Union v. FLRA, 834 F.2d 191, 196 (D.C. Cir. 1987)) (second ellipsis in original). Because ARTBA had not filed suit within sixty days of either the 1997 re-promulgation or a later event that ripened its claim, the Circuit dismissed the case for lack of subject matter jurisdiction. Id. at 1113--16.

In 2010, ARTBA submitted comments on California's proposed revisions to a portion of its state implementation plan ("SIP"),*fn6 and "renew[ed] [ARTBA's] petition with respect to the nonroad preemption rules." ARTBA Comments and Rulemaking Petition Regarding Revision to California State Implementation Plan, EPA Docket R09-OAR-2010-0430, Doc. 14, at 1 (July 6, 2010). The association sought "EPA's denial of California's SIP revision for the same reasons that ARTBA ha[d] long sought amendment of EPA's rules implementing Section 209(e)." Id. at 2. Rejecting the petition, the EPA explained that "ARTBA's petition seems to be little more than a renewal of its earlier request for an amendment to EPA's rule implementing Clean Air Act section 209(e)." Revisions to the California State Implementation Plan, 76 Fed. Reg. 26,609, 26,611--12 (May 9, 2011). The agency noted that it had "already reviewed these issues several times and [was] not revisiting these broader issues in this limited proceeding." Id. at 26,612.

On July 8, 2011, ARTBA filed suit in the Ninth and D.C. Circuits. ARTBA petitioned the D.C. Circuit to review (1) the EPA's approval of the SIP revisions, (2) the agency's refusal to designate its action as having "nationwide scope or effect" under section 307(b)(1) and therefore subject to challenge in the D.C. Circuit instead of the Ninth Circuit, and (3) its denial of ARTBA's petition to amend or repeal the rules concerning the preemptive scope of section 209(e). See Petition for Review, ARTBA v. EPA, No. 11-1256 (D.C. Cir. July 8, 2011). ARTBA petitioned the Ninth Circuit to review only the approval of the SIP revisions. See Petition for Review, ARTBA v. EPA, No. 11-71897 (9th Cir. July 8, 2011). The Ninth Circuit case is currently stayed pending the resolution of the D.C. Circuit case.

On September 22, 2011, ARTBA brought this case "to challenge EPA's final agency action with respect to" the 2008 rulemaking at issue in ARTBA v. EPA, 588 F.3d 1109 (D.C. Cir. 2009), as well as the 2011 rulemaking regarding the California SIP revisions, both of which "relate to the preemptive scope of Clean Air Act § 209(e), 42 U.S.C. § 7543(e)." Compl. ¶ 1. ARTBA seeks, in essence, a declaratory judgment approving its interpretation of that provision and requiring the EPA to amend its regulations accordingly. ARTBA also asks this court to void decisions of the United States Supreme Court and the D.C. Circuit. The association has named as defendants the United States, the EPA, ...


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