McCoy-Elkhorn Coal Corp. v. U.S. E.P.A.

• Decision Date: 02 June 1980
• Docket Number: 79-3327 and 79-3398,COY-ELKHORN,Nos. 79-3326,s. 79-3326
• Citation: 622 F.2d 260
• Parties: , 10 Envtl. L. Rep. 20,363 McCOAL CORPORATION, Plaintiff-Appellant, and Ohio Edison Company, Intervening-Plaintiff-Appellant, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY et al., Defendants-Appellees, and State of Ohio et al., and United Mine Workers of America, District 6, Intervening Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 260

622 F.2d 260

14 ERC 1620, 10 Envtl. L. Rep. 20,363

McCOY-ELKHORN COAL CORPORATION, Plaintiff-Appellant and Ohio Edison Company, Intervening-Plaintiff-Appellant, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY et al Defendants-Appellees and State of Ohio et al., and United Mine Workers of America District 6, Intervening Defendants-Appellees.

Nos. 79-3326, 79-3327 and 79-3398.

United States Court of Appeals, Sixth Circuit.

Argued Oct. 15, 1979.

Decided June 2, 1980.

James Park, Jr., Stoll, Keenon & Park, Katherine Randall, William L. Montague, Lexington, Ky., Donald H. Vish, Gen. Counsel, McCoy-Elkhorn Coal Corp., Lexington, Ky., for McCoy-Elkhorn Coal Corp.

Patrick H. Molloy, U. S. Atty., Lexington, Ky., for E.P.A. and Costle.

Stephen D. Ramsey, U. S. Dept. of Justice, Land & Natural Resources Div., Pollution Control Section, Washington, D.C., General Counsel's Office, E.P.A., Washington, D.C., Michael R. Dowling, Ashland, Ky., Joel S. Taylor, David E. Northrop, Asst. Attys. Gen., Frank Pierce, Gen. Counsel, United Mine Workers of America, District 6, Shadyside, Ohio, James W. Moorman, Robert L. Klarquist, Maryann Walsh, Dept. of Justice, Land & Natural Resources Div., Appellate Section, Washington, D.C., for defendants-appellees and intervening defendants-appellees.

William H. Cull, Deputy Gen. Counsel, Frankfort, Ky., for amicus Gov. Carroll.

Carl D. Perkins, Ashley, Perkins & Slack, Washington, D.C., for amici curiae Members of Congress.

Lowell T. Hughes, Van Antwerp, Hughes, Monge & Jones, Ashland, Ky., Russell J. Spetrino, Ohio Edison Company, Akron, Ohio, J. Jeffrey McNealey, Porter, Wright, Morris & Arthur, Columbus, Ohio, for Ohio Edison Co.

Before EDWARDS, Chief Judge, and ENGEL and JONES, Circuit Judges.

NATHANIEL R. JONES, Circuit Judge.

Appellants attack Section 125 of the Clean Air Act, as amended, 42 U.S.C. § 7425, as unconstitutional on its face. The district court upheld the constitutionality of the statute under the Commerce Clause and the Due Process Clause of the Fifth Amendment. We affirm.

Section 125 of the Clean Air Act, as amended, authorizes the President or his designee ¹ to "prohibit (a) major fuel burning stationary source . . . from using fuels other than locally or regionally available coal" when considered "necessary to prevent or minimize significant local or regional economic disruption or unemployment." The statute applies only to major fuel burning stationary sources which have the capacity to produce 250,000,000 BTUs per hour and which are not in compliance with the state implementation plan. The statute empowers the Administrator of the Environmental Protection Agency (EPA) to define the locale or region. If action under Section 125 is deemed necessary, the affected purchasers of coal must enter into long-term contracts for supply of locally or regionally available coal. Only companies not yet in compliance with EPA standards can be affected by orders under Section 125.

The EPA implementation plan for Ohio specifies two ways by which companies can comply with the sulfur dioxide standards: 1) burn low sulfur fuel, including blended or washed coal or 2) use flue gas desulfurization (scrubbers). Every Ohio utility chose the less expensive low sulfur option. Section 125, if invoked, would eliminate the low sulfur coal option for companies in areas producing high sulfur coal.

On December 28, 1978, EPA proposed to invoke Section 125 in order to prohibit Ohio utility companies from burning coal not locally or regionally available. 43 Fed.Reg. 60652. The proposed determination would require Ohio utilities not yet in compliance with the applicable environmental standards to purchase high sulfur coal rather than low sulfur coal. To comply with environmental standards, the utility companies would be compelled to install scrubbers.

Shortly after the EPA's proposed determination, McCoy-Elkhorn Coal Corporation, a Kentucky producer of low sulfur coal, filed a complaint against the EPA and its Administrator in the district court. McCoy-Elkhorn alleged that Section 125 violates the Commerce Clause and the Due Process Clause of the Fifth Amendment. It sought declaratory and injunctive relief.

Ohio Edison Company was granted permission under Rule 24(b), Fed.R.Civ.P., to intervene as a plaintiff. Ohio Edison is an Ohio utility not yet in compliance with the state implementation plan. In 1977, Ohio Edison elected to burn low sulfur coal instead of installing scrubbers in order to comply with environmental standards. Under federal regulations, Ohio Edison was required to be in compliance no later than October 19, 1979. If Ohio Edison had chosen to install scrubbers, the deadline date would have been June 13, 1980.

The State of Ohio, Governor of Ohio and United Mine Workers, District 6, were granted permission to intervene as defendants. All three parties had petitioned the EPA to institute proceedings pursuant to Section 125 in order to protect the Ohio high sulfur coal industry. They acted soon after this Court upheld the validity of the sulfur dioxide emission standards. Cincinnati Gas & Elec. Co. v. EPA, 578 F.2d 660 (6th Cir. 1978), cert. denied, 439 U.S. 1114, 99 S.Ct. 1017, 59 L.Ed.2d 72 (1979); Cleveland Electric Illuminating Co. v. EPA, 572 F.2d 1150 (6th Cir.), cert. denied, 439 U.S. 910, 99 S.Ct. 278, 58 L.Ed.2d 256 (1978).

The district court entered its order sustaining Section 125 on May 7, 1979. On August 30, 1979, the EPA issued a reproposed determination under Section 125. The EPA now proposes to find the local and regional economic disruption from Ohio utilities switching to low sulfur coal insufficient to warrant action under Section 125. To date the EPA has not issued a final rule, though the extended period for comment on the reproposed determination expired on February 20, 1980. 45 Fed.Reg. 2893 (January 15, 1980).

I. JUSTICIABILITY

Before addressing the merits of this appeal, we must discuss the difficult problems of standing, ripeness and mootness. To have standing, plaintiffs must demonstrate identifiable injuries in fact to themselves and a substantial likelihood that judicial relief would redress their injuries. Duke Power Co. v. Carolina Environmental Study Group, Inc., 438 U.S. 59, 98 S.Ct. 2620, 57 L.Ed.2d 595 (1978). Plaintiffs must prove either an actual injury or a real and immediate threat of injury resulting from the enforcement of Section 125. O'Shea v. Littleton, 414 U.S. 488, 94 S.Ct. 669, 38 L.Ed.2d 674 (1974); Poe v. Ullman, 367 U.S. 497, 81 S.Ct. 1752, 6 L.Ed.2d 989 (1961). Because McCoy-Elkhorn has suffered economic harm from a constriction of its market caused by Section 125, it therefore does have standing. Craig v. Boren, 429 U.S. 190, 97 S.Ct. 451, 50 L.Ed.2d 397 (1976).

At trial McCoy-Elkhorn sought to substantiate its general allegation of injury to its market for customers. ² Ohio is and has been a large and natural market for McCoy-Elkhorn. The testimony disclosed one set of negotiations in Ohio with the Cleveland Electric Illuminating Company (CEI). McCoy-Elkhorn had never sold coal to CEI before and the negotiations were in the preliminary stages. Witnesses testified that the threat from the Section 125 proceedings was a factor in the breakdown of the negotiations, though many other factors may have been the cause. Apparently on the basis of this testimony, the district court found that McCoy-Elkhorn "has shown an immediate impediment and a greater threatened impairment to its ability to do business in Ohio directly attributable to Section 125 of the Act." Therefore, the district court held that McCoy-Elkhorn presented a case or controversy under Article III, Section 2 of the Constitution. The finding of business injury to McCoy-Elkhorn is not clearly erroneous.

At the time of trial, the EPA had issued a proposed determination to use Section 125, but had not yet defined the exact region. Though the district court determined that the injury to McCoy-Elkhorn was "directly attributable to Section 125," we note that McCoy-Elkorn did not file its complaint until after the proposed determination by the EPA. The district court did not discuss the significance for purposes of standing of the pending proposed determination.

We must consider the effect of the reproposed determination by the EPA on the standing of McCoy-Elkhorn. The business injury to McCoy-Elkhorn arises from the threat of Section 125 and is increased by the initiation of Section 125 proceedings. Though the reproposed determination lessens the immediate threat, the threat nevertheless remains until the EPA issues a favorable final rule.

McCoy-Elkhorn will continue to suffer a restricted business market at least as long as the Section 125 proceedings are pending. A decision in favor of appellant would redress its alleged injuries by removing a significant impediment to McCoy-Elkhorn's ability to sell its coal in Ohio. See Village of Arlington Heights v. Metropolitan Housing Development Corp., 429 U.S. 252, 261-64, 97 S.Ct. 555, 561-62, 50 L.Ed.2d 450 (1977). Therefore, at this time, the injury to McCoy-Elkhorn is sufficiently real and immediate to accord standing. ³

Ripeness is a less difficult question than standing. The ripeness doctrine was developed in the context of judicial review of administrative agency action. E. g., Abbott Laboratories v. Gardner, 387 U.S. 136, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967). It has been applied in cases concerning facial attacks on the constitutionality of a statute. Duke Power Co. v. Carolina Environmental Study Group, Inc., 438 U.S. at 81-82, 98 S.Ct. at 2635. Ripeness calls for a common sense judgment on the fitness of the issues for judicial review and the actual hardship to the parties if a court decision were withheld. Poe v. Ullman, 367 U.S. 497, 508, 81 S.Ct. 1752, 6 L.Ed.2d 989 (1961); Diamond Shamrock Corp. v. Costle, 580 F.2d 670, 675 (D.C.Cir.1978).

We are persuaded that the ripeness standard has...