Ced's Inc. v. U.S. E.P.A.
| Decision Date | 29 October 1984 |
| Docket Number | No. 83-2608,83-2608 |
| Citation | 745 F.2d 1092 |
| Parties | , 53 USLW 2214, 40 Fed.R.Serv.2d 26, 14 Envtl. L. Rep. 20,869 CED'S INC., d/b/a Products For Power, Plaintiff-Appellee, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, and Lee Thomas, Acting Administrator, United States Environmental Protection Agency, Defendants-Appellants. |
| Court | U.S. Court of Appeals — Seventh Circuit |
James R. Morrin, Wildman, Harrold, Allen & Dixon, Chicago, Ill., for plaintiff-appellee.
Arthur E. Gowran, Dept. of Justice, Washington, D.C., Ralph J. Colleli, Jr., Asst. U.S. Atty., Dan K. Webb, U.S. Atty., Chicago, Ill., for defendants-appellants.
Before ESCHBACH and FLAUM, Circuit Judges, and JAMESON, Senior District Judge. *
The Environmental Protection Agency appeals from an order of the district court enjoining it from making use of copies of business records it had obtained from Ced's Inc. under an administrative warrant and ordering it to return the copies to the company. The principal issue presented is the scope of the Environmental Protection Agency's authority to copy records of companies under section 114(a) of the Clean Air Act. We reverse.
Ced's Inc. ("Ced's"), doing business as Products for Power, manufactures and distributes automotive engine exhaust equipment, including a device known as the "Test Tube," a length of hollow metal pipe shaped and fitted to replace the catalytic converter in an automobile exhaust system. Under section 203(a) of the Clean Air Act (the "Act"), 42 U.S.C. Sec. 7522(a)(3)(B), those in the business of repairing and servicing automobiles are prohibited from permanently replacing a catalytic converter with a pipe such as the Test Tube, although they may temporarily make the substitution for the purpose of determining if the catalytic converter needs to be replaced. The owner of an automobile is not prohibited from permanently replacing its catalytic converter with a Test Tube. Ced's markets the Test Tube nationwide, but exclusively to warehouse distributors, not directly to retailers or automotive repair facilities.
The Environmental Protection Agency ("EPA") suspects that the unlawful permanent installation of catalytic converter replacement pipes by automotive repair and service facilities is a pervasive problem with potentially far-reaching deleterious environmental consequences. It has accordingly been investigating the practice.
On April 5, 1983, the EPA applied to a magistrate for an administrative warrant under section 114(a) of the Act, 42 U.S.C. Sec. 7414(a), authorizing the examination and copying of certain of Ced's business records pertaining to the promotion and sale of the Test Tube. The application was based on evidence which, the EPA claimed, established administrative probable cause to believe that Ced's may have caused certain automobile repair facilities to remove catalytic converters permanently and to replace them with Test Tubes in violation of section 203(a) of the Act. The magistrate issued the warrant ex parte. On April 6 EPA agents served the warrant, entered Ced's facility during normal business hours, and examined and copied documents. While the inspection was in progress, Ced's filed with the magistrate a motion to quash the warrant. A hearing was held on April 6, and the magistrate denied the motion.
On April 7 Ced's filed a motion in the district court seeking a temporary restraining order or preliminary injunction enjoining execution of the warrant and ordering the return of the documents, and a complaint requesting a permanent injunction forbidding the EPA to enter Ced's premises and to inspect Ced's records. On the same day the EPA filed a motion to dismiss the complaint. The court held hearings on these motions and on July 1 signed an order and issued a memorandum opinion denying the EPA's motion to dismiss, granting a permanent injunction prohibiting the EPA from making any use of materials obtained from Ced's under the administrative warrant, and ordering the EPA to return those materials, including any copies, to the company. The order was entered on July 6.
On July 22 the EPA filed its motion for stay pending appeal, and on August 5 the district court stayed compliance with that portion of its order that required the EPA to return to Ced's copies of documents that were inspected pursuant to the administrative search warrant. On August 31 the EPA filed its notice of appeal to this court.
On November 1 the district court (apparently viewing its order of August 5 as merely an interim order) entered a second order with respect to the EPA's motion for stay pending appeal, this time denying the motion but permitting the EPA to retain the copies of Ced's documents pending the appeal, without using them in any way. Attached to the order was a supplemental memorandum opinion which did not address itself to the EPA's motion for a stay but instead set forth additional grounds in support of its order of July 1 granting a permanent injunction. The additional grounds took the form entirely of conclusions of law; there were no new findings of fact.
In this appeal the EPA contends that the district court erroneously determined that the EPA had no authority under section 114(a)(2)(B) of the Act to inspect and copy Ced's business records and that the district court exceeded its jurisdiction by issuing a supplemental memorandum opinion amending its previous order after the EPA had filed its notice of appeal.
Because it affects the scope of our review, we consider first the question whether the district court exceeded its jurisdiction in issuing the supplemental memorandum opinion on November 1, nearly four months after judgment was entered and two months after the EPA filed its notice of appeal.
As the EPA points out, there is a general rule that the filing of a notice of appeal divests the district court of jurisdiction over the matters appealed. Lenard v. Argento, 699 F.2d 874, 898 (7th Cir.), cert. denied, --- U.S. ----, 104 S.Ct. 69, 78 L.Ed.2d 84 (1983); United States v. Bastanipour, 697 F.2d 170, 173 (7th Cir.1982), cert. denied, 460 U.S. 1091, 103 S.Ct. 1790, 76 L.Ed.2d 358 (1983); McClatchy Newspapers v. Central Valley Typographical Union No. 46, 686 F.2d 731, 734 (9th Cir.), cert. denied, 459 U.S. 1071, 103 S.Ct. 491, 74 L.Ed.2d 633 (1982). There are exceptions for certain actions serving to preserve the status quo pending the appeal, United States v. El-O-Pathic Pharmacy, 192 F.2d 62, 79 (9th Cir.1951), or to assist the court of appeals in its determination. United States v. Lafko, 520 F.2d 622, 627 (3d Cir.1975). 1
We are persuaded that none of the exceptions to the rule is applicable here. Even if the district court was motivated by a desire to assist this court in its determination by stating additional conclusions of law on the basis of which this court might affirm the order, the assistance in this case came too late. 2 The filing of a notice of appeal sets the appellate clock running, and the parties and the clerk of the court become subject to deadlines imposed by the rules. The parties to an appeal are entitled to have a stable set of conclusions of law on which they can rely in preparing their briefs. The district court issued its supplemental memorandum opinion only a week before appellant EPA's opening brief was due, making it necessary for the EPA to prepare a supplemental brief and appendix and requiring the preparation of a supplemental record on appeal.
The district court stated at the hearing on the EPA's motion for stay pending appeal that because of the issues raised the court would treat it "in effect, as the equivalent of a motion to reconsider." Transcript of Hearing, July 22, 1983, at 5. Under Rule 4(a)(4) of the Federal Rules of Appellate Procedure, a timely motion under Rule 59 of the Federal Rules of Civil Procedure postpones the time for appeal until the entry of an order granting or denying the motion, and a notice of appeal filed before the disposition of the motion has no effect. For purposes of Rule 4(a), a motion to reconsider is treated as a Rule 59(e) motion. Lenard v. Argento, 699 F.2d 874, 898 (7th Cir.), cert. denied, --- U.S. ----, 104 S.Ct. 69, 78 L.Ed.2d 84 (1983). But even if we view the EPA's motion to stay as a motion to reconsider, and thus as equivalent to a Rule 59(e) motion, it was clearly out of time. Rule 59(e) sets a limit of ten days after entry of judgment, and the EPA's motion was filed later. Rule 4(a)(4), therefore, does not apply.
Accordingly, the district court's supplemental memorandum opinion of November 1, 1983 is vacated. We thus need not consider the EPA's assignments of error relating to that opinion.
We come now to the central issue in the case: whether the EPA had authority to carry out its inspection and copying of Ced's records. The EPA bases its assertion of authority over Ced's on the premise that Ced's is a "person ... subject to any requirement of the Act," within the meaning of section 114(a)(1). 3 Specifically, the EPA asserts, Ced's is subject to section 203(a), which enumerates certain prohibitions. Ced's denies that it is subject to section 203(a) or to any other requirement of the Act. 4 We agree with the EPA.
Section 203(a) begins: "The following acts and the causing thereof are prohibited ...." 42 U.S.C. Sec. 7522(a) (emphasis added). Subsection (3)(B) reads:
for any person engaged in the business of repairing, servicing, selling, leasing, or trading motor vehicles or motor vehicle engines, or who operates a fleet of motor vehicles, knowingly to remove or render inoperative any device or element of design installed on or in a motor vehicle or motor vehicle engine in compliance with regulations under this subchapter following its sale and delivery to the ultimate purchaser.
Id. Sec. 7522(a)(3)(B). Ced's, along with everyone else, is...
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