Energy Future Coal. v. Envtl. Prot. Agency

• Decision Date: 14 July 2015
• Docket Number: No. 14–1123.,14–1123.
• Citation: 793 F.3d 141
• Parties: ENERGY FUTURE COALITION, et al., Petitioners v. ENVIRONMENTAL PROTECTION AGENCY and Gina McCarthy, Respondents American Fuel & Petrochemical Manufacturers and American Petroleum Institute, Intervenors.
• Court: U.S. Court of Appeals — District of Columbia Circuit

793 F.3d 141

ENERGY FUTURE COALITION, et al., Petitioners

v.ENVIRONMENTAL PROTECTION AGENCY and Gina McCarthy, Respondents

American Fuel & Petrochemical Manufacturers and American Petroleum Institute, Intervenors.

No. 14–1123.

United States Court of Appeals, District of Columbia Circuit.

Argued March 20, 2015.

Decided July 14, 2015.

Adam R.F. Gustafson argued the cause for petitioners. With him on the briefs were C. Boyden Gray and Adam J. White.

Anna J. Wildeman and Valerie L. Green were on the brief for amicus curiae Governors' Biofuels Coalition in support of petitioners.

Michael C. Augustini, Attorney, U.S. Department of Justice, argued the cause for respondents. With him on the brief were John C. Cruden, Assistant Attorney General, and Mark M. Kataoka, Attorney, U.S. Environmental Protection Agency.

Stacy R. Linden, Richard S. Moskowitz, Chet M. Thompson, Robert Meyers, and David Y. Chung were on the brief for intervenors American Fuel & Petrochemical Manufacturers and American Petroleum Institute in support of respondents.

Before: TATEL, KAVANAUGH, and PILLARD, Circuit Judges.

Opinion

Opinion for the Court filed by Circuit Judge KAVANAUGH.

KAVANAUGH, Circuit Judge:

The goal of the Clean Air Act is “to protect and enhance the quality of the Nation's air resources so as to promote the public health and welfare and the productive capacity of its population.” 42 U.S.C. § 7401(b). To help achieve that objective, the Clean Air Act grants EPA authority to regulate vehicle emissions. As relevant here, EPA has adopted regulations that require vehicle manufacturers to test the emissions of new vehicles. Vehicle manufacturers must conduct emissions testing using a “test fuel.” 40 C.F.R. § 1065.701(a). And under the regulation at issue here, the test fuel must be a fuel that is “commercially available.” Id. § 1065.701(c). That regulation implements the statutory directive that “vehicles are tested under circumstances which reflect the actual current driving conditions under which motor vehicles are used, including conditions relating to fuel.” 42 U.S.C. § 7525(h).

Petitioners in this case include several biofuel producers.¹ Petitioners want EPA to approve E30, which is a fuel that contains about 30% ethanol, for use as a test fuel. But according to petitioners, E30 is not yet “commercially available,” as required by EPA's test fuel regulation.

In this suit, petitioners argue that the test fuel regulation is arbitrary and capricious. We disagree. We therefore deny the petition.

I

Before reaching the merits, we address several threshold arguments raised by EPA regarding the Court's authority to decide the case. We reject each of those arguments.

First, petitioners have Article III standing to maintain this suit. They have suffered an injury in fact caused by EPA and redressable by the Court. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992).

Several of the petitioners produce ethanol. Petitioners want EPA to approve E30 as a test fuel. According to petitioners, EPA's test fuel regulation prohibits the use of E30 as a test fuel. As a direct result of that regulation, petitioners claim that they face a regulatory impediment (what they view as an illegal regulatory impediment) that prevents their product from being used as a test fuel. That qualifies as an injury in fact. See Abigail Alliance for Better Access to Developmental Drugs v. Eschenbach, 469 F.3d 129, 134–35 (D.C.Cir.2006).

EPA points out that the test fuel regulation is technically directed at vehicle manufacturers, not biofuel producers. But that does not undermine petitioners' standing. The standing question in this case is straightforward: If the Government prohibits or impedes Company A from using Company B's product, does Company B have standing to sue? Suppose the FDA bans or makes it harder for soda manufacturers to use sugar. Does a sugar manufacturer have standing to sue? Or suppose the District of Columbia bans or makes it harder for concession stands to sell hot dogs. Does a local hot dog manufacturer have standing to sue? Ordinarily the answer to those questions is yes. In such cases, both Company A and Company B are “an object of the action (or forgone action) at issue,” so “there is ordinarily little question” that they have standing under Lujan . 504 U.S. at 561–62, 112 S.Ct. 2130 ; see also Ethyl Corp. v. EPA, 306 F.3d 1144, 1148 (D.C.Cir.2002) (fuel additive manufacturer has standing to challenge EPA emissions testing regulation). So it is here.

Petitioners have also demonstrated causation and redressability. Petitioners contend that the “commercially available” requirement is a direct regulatory impediment that prevents their product from being used as a test fuel. That suffices to show causation. See Abigail Alliance, 469 F.3d at 135 (Many “hurdles impeding Alliance members from accessing post-Phase I investigational new drugs have been erected by the FDA. This is sufficient to establish causation.”).

It is true that “vehicle manufacturers may have valid business reasons” other than EPA's test fuel regulation “for not seeking to use” E30 as a test fuel. EPA Br. 27. But that does not undermine causation here. Petitioners simply seek an opportunity to compete in the marketplace. As of now, they claim they are being denied that opportunity because of EPA's regulation. Moreover, if EPA permitted vehicle manufacturers to use E30 as a test fuel, there is substantial reason to think that at least some vehicle manufacturers would use it. Indeed, Ford Motor Company submitted comments to EPA saying that it “supports the development and introduction of an intermediate level blend fuel (E16–E50)” and that the “development of such a fuel would enable the first steps to the development of a new generation of highly efficient internal combustion engine vehicles.” J.A. 145.

Finally, petitioners' injury is redressable. Invalidating the “commercially available” requirement would remove a regulatory hurdle to the use of E30 as a test fuel. That is enough to demonstrate redressability. A “plaintiff satisfies the redressability requirement” by showing “that a favorable decision will relieve a discrete injury” to the plaintiff. Massachusetts v. EPA, 549 U.S. 497, 525, 127 S.Ct. 1438, 167 L.Ed.2d 248 (2007). The plaintiff “need not show that a favorable decision will relieve” his or her “every injury.” Id.²

Put simply, petitioners have standing to challenge the legality of the test fuel regulation.

Second, petitioners are within the zone of interests protected by the Clean Air Act. See Lexmark International, Inc. v. Static Control Components, Inc., ––– U.S. ––––, 134 S.Ct. 1377, 1388–89, 188 L.Ed.2d 392 (2014). The Clean Air Act provides that a “petition for review of ... any other nationally applicable regulations promulgated, or final action taken, by the Administrator under this chapter may be filed only in the United States Court of Appeals for the District of Columbia.” 42 U.S.C. § 7607(b)(1). The Clean Air Act seeks to further clean air while at the same time still allowing some productive economic activity, even though that economic activity may result in some emissions of pollutants.

As the Supreme Court has emphasized, the zone of interests test “is not meant to be especially demanding.” Match–E–Be–Nash–She–Wish Band of Pottawatomi Indians v. Patchak, ––– U.S. ––––, 132 S.Ct. 2199, 2210, 183 L.Ed.2d 211 (2012) ; see also Ethyl, 306 F.3d at 1148. Indeed, the “test forecloses suit only when a plaintiff's interests are so marginally related to or inconsistent with the purposes implicit in the statute that it cannot reasonably be assumed that Congress intended to permit the suit.” Match–E, 132 S.Ct. at 2210 (internal quotation marks omitted); see also Myersville Citizens for a Rural Community, Inc. v. FERC, 783 F.3d 1301, 1316 (D.C.Cir.2015).

In Ethyl, this Court held that a fuel additive manufacturer fell within the zone of interests under the Clean Air Act and could challenge EPA regulations governing emissions testing for vehicles. See 306 F.3d at 1148. Petitioners here challenge an EPA regulation governing emissions testing for vehicles under the same part of the Clean Air Act. We see no principled way to distinguish the fuel additive manufacturer in Ethyl from the biofuel producers in this case, a conclusion only strengthened by the Supreme Court's recent cases emphasizing that the zone of interests test is not especially demanding. Petitioners are within the zone of interests.

Third, petitioners' challenge is timely. A petition for review of final EPA action under the Clean Air Act ordinarily must “be filed within sixty days from the date notice” of the action “appears in the Federal Register.” 42 U.S.C. § 7607(b)(1). On April 28, 2014, EPA issued a final rule extending the test fuel regulation to light-duty cars and trucks. On June 26, 2014, fewer than 60 days after publication, petitioners timely filed this petition.

Fourth, petitioners' suit is ripe. The “fitness of an issue for judicial decision depends on whether it is purely legal, whether consideration of the issue would benefit from a more concrete setting, and whether the agency's action is sufficiently final.” National Association of Home Builders v. Army Corps of Engineers, 417 F.3d 1272, 1281 (D.C.Cir.2005) (internal quotation marks omitted). If “there are no significant agency or judicial interests militating in favor of delay,” a lack of hardship “cannot tip the balance against judicial review.” National Association of Home Builders v. Army Corps of Engineers, 440 F.3d 459, 465 (D.C.Cir.2006).

Petitioners argue that the test fuel regulation is arbitrary and capricious because it requires that a test fuel be “commercially available.” That claim is ripe. The test fuel regulation is a final agency action, and petitioners' challenge is purely legal. “It is well-established that claims that an agency's action is arbitrary and capricious or contrary to law present purely...