Motor & Equipment Mfrs. Ass'n v. Nichols, Nos. 96-1392 and 96-1397

CourtUnited States Courts of Appeals. United States Court of Appeals (District of Columbia)
Writing for the CourtROGERS
Citation142 F.3d 449
Parties, 330 U.S.App.D.C. 1, 28 Envtl. L. Rep. 21,111 MOTOR & EQUIPMENT MANUFACTURERS ASSOCIATION, et al., Petitioners, v. Mary D. NICHOLS, Assistant Administrator and Environmental Protection Agency, Respondents, American Automobile Manufacturers Association, et al., Intervenors. MOTOR & EQUIPMENT MANUFACTURERS ASSOCIATION, et al., Petitioners, v. ENVIRONMENTAL PROTECTION AGENCY and Carol M. Browner, Administrator, United States Environmental Protection Agency, Respondents, American Automobile Manufacturers Association and Association of International Automobile Manufacturers, Inc., Intervenors.
Decision Date24 April 1998
Docket NumberNos. 96-1392 and 96-1397

Page 449

142 F.3d 449
46 ERC 1417, 330 U.S.App.D.C. 1, 28
Envtl. L. Rep. 21,111
MOTOR & EQUIPMENT MANUFACTURERS ASSOCIATION, et al., Petitioners,
v.
Mary D. NICHOLS, Assistant Administrator and Environmental
Protection Agency, Respondents,
American Automobile Manufacturers Association, et al., Intervenors.
MOTOR & EQUIPMENT MANUFACTURERS ASSOCIATION, et al., Petitioners,
v.
ENVIRONMENTAL PROTECTION AGENCY and Carol M. Browner,
Administrator, United States Environmental
Protection Agency, Respondents,
American Automobile Manufacturers Association and
Association of International Automobile
Manufacturers, Inc., Intervenors.
Nos. 96-1392 and 96-1397.
United States Court of Appeals,
District of Columbia Circuit.
Argued Jan. 22, 1998.
Decided April 24, 1998.

Page 451

On Petitions for Review of an Order of the Environmental Protection Agency.

Michael J. Conlon argued the cause in No. 96-1392 for petitioners, with whom Marc L. Fleischaker, Donald B. Mitchell, Jr., Evan S. Stolove, John Russell Deane, III, Christopher J. Kersting, Basil J. Mezines and Michael T. Reid were on the briefs. Louis R. Marchese entered an appearance.

Michael J. Horowitz, Attorney, Environmental Protection Agency, argued the causes for respondents, with whom Lois J. Schiffer, Assistant Attorney General, U.S. Department of Justice, Jeffrey K. Lee, Attorney, and Jonathan Z. Cannon, General Counsel, Environmental Protection Agency, were on the brief. Karen L. Egbert, Attorney, U.S. Department of Justice, entered an appearance.

Clifford T. Lee, Deputy Attorney General, State of California, argued the cause in No. 96-1392 for intervenor California Air Resources Board, with whom Daniel E. Lungren, Attorney General, and Michael Terris, Senior Staff Counsel, California Air Resources Board, were on the brief.

John H. Beisner, John A. Rogovin, Martha Dye, Richard A. Penna, Howard E. Shapiro, V. Mark Slywynsky, Charles H. Lockwood and John T. Whatley were on the brief in No. 96-1392 for intervenors American Automobile Manufacturers Association and Association of International Automobile Manufacturers, Inc.

Marc L. Fleischaker argued the cause in No. 96-1397 for petitioners, with whom Donald B. Mitchell, Jr., Evan S. Stolove, John

Page 452

Russell Deane, III, Christopher J. Kersting, Basil J. Mezines, Michael J. Conlon and Michael T. Reid were on the briefs. Louis R. Marchese entered an appearance.

John H. Beisner argued the cause in No. 96-1397 for intervenors, with whom John A. Rogovin, Martha Dye, Richard A. Penna, Howard E. Shapiro, V. Mark Slywynsky, Charles H. Lockwood and John T. Whatley were on the brief.

Before: EDWARDS, Chief Judge, WALD and ROGERS, Circuit Judges.

ROGERS, Circuit Judge:

These two appeals present Clean Air Act ("CAA" or "the Act") challenges to California's latest round of automobile on-board emissions diagnostic device ("OBD") regulations. Petitioners are a number of associations that represent businesses that manufacture, rebuild, and sell car parts in what is known as the automobile "aftermarket," in that the parts they make and sell are meant to replace the parts installed by the original automobile manufacturers. In the first appeal, they challenge the Environmental Protection Agency's ("EPA") decision to permit California to enforce its own regulations of the OBDs pursuant to section 209(b) of the CAA (the "waiver decision"). In the second appeal, petitioners challenge EPA's rule deeming compliance with the California diagnostic device regulations to constitute compliance with the federal diagnostic device regulations (the "deemed-to-comply" rule).

Petitioners contend that both the waiver decision and the deemed-to-comply rule run afoul of CAA subsections 202(m)(4) and (5). Those subsections require the data collected by the diagnostic devices to be easily accessible and understandable to all mechanics who service automobiles, whether they are independent or affiliated with an automobile manufacturer. EPA concluded that California's regulations complied with subsections (m)(4) and (5), and we defer to the agency's reasonable interpretation of the CAA. Preliminarily, however, we hold that certain parts of the petitions are moot in view of the most recent revisions to the California regulations, and that our review of one challenge to the deemed-to-comply rule based on CAA section 202(b)(1)(C) is barred for failure to exhaust administrative remedies. Petitioners have standing to challenge EPA's deemed-to-comply rule, however, and timely presented their challenge to that rule. Furthermore, we hold that EPA's waiver decision was not inconsistent with the CAA. In sum, the agency acted within its authority in promulgating both rules. Accordingly, we deny the petitions in part and dismiss in part.

I.

A. The Clean Air Act

The Clean Air Act, 42 U.S.C. §§ 7401-7671q (1988 & Supp. V 1993), regulates air pollution by establishing air quality standards for certain pollutants and controlling the emissions of approximately 189 hazardous pollutants. See CAA §§ 109, 112, 42 U.S.C. §§ 7409, 7412. 1 The Act establishes a two-pronged federal-state approach limiting motor vehicle pollution. See generally Engine Mfrs. Ass'n v. EPA, 88 F.3d 1075, 1078 (D.C.Cir.1996). The states regulate automobiles after they have been purchased by consumers through inspection and maintenance programs. See CAA §§ 174, 176, 182(b)(4), (a)(2)(B), 42 U.S.C. §§ 7504, 7506, 7511a(b)(4), (a)(2)(B). Inspection and maintenance programs are designed to identify and ensure the repair of in-use automobiles that are emitting excessive pollutants. Subchapter I of the Act is primarily concerned with the ground rules for the implementation of these post-purchase programs by the states. Subchapter II of the Act vests in the federal government the almost exclusive responsibility for establishing automobile emission standards for new cars. See CAA §§ 202, 209(a), 42 U.S.C. §§ 7521, 7543(a).

Page 453

One state, California, is permitted to establish its own automobile emissions standards for new cars. See CAA § 209(b), 42 U.S.C. § 7543(b); Engine Mfrs. Ass'n, 88 F.3d at 1078 & n. 9. Other states are permitted to adopt California's standards instead of those promulgated by the federal government. See CAA § 177, 42 U.S.C. § 7507. The effect of the Clean Air Act is that new "motor vehicles must be either 'federal cars' designed to meet EPA's standards or 'California cars' designed to meet California's standards." Engine Mfrs. Ass'n, 88 F.3d at 1080.

The California exception is intended "to afford California the broadest possible discretion in selecting the best means to protect the health of its citizens and the public welfare." H.R.Rep. No. 95-294, at 301-02 (1977), quoted in Motor and Equip. Mfrs. Ass'n, Inc. v. EPA, 627 F.2d 1095, 1110 (D.C.Cir.1979) ("MEMA I"). However, California is required to determine that its standards will be "in the aggregate, at least as protective of public health and welfare as applicable Federal standards" before promulgating them. CAA § 209(b)(1), 42 U.S.C. § 7543(b)(1). Furthermore, California may only adopt and enforce its own emission standards after receiving a waiver of preemption from the EPA. See Motor Vehicle Mfrs. v. New York State Dep't of Envtl. Conservation, 17 F.3d 521, 526 (2d Cir.1994). The EPA Administrator, in turn, may only deny California's waiver application if she finds that (1) the state's protectiveness determination is arbitrary or capricious, (2) California does not need separate state standards to meet "compelling and extraordinary conditions," or (3) California's "standards and accompanying enforcement procedures are not consistent with" section 202(a) of the Act [42 U.S.C. § 7521(a) ]. CAA § 209(b)(1), 42 U.S.C. § 7543(b)(1).

OBDs were first installed by automobile manufacturers in 1981. 2 OBDs monitor, control, and record the emissions released by automobile engines. 3 They also store information about emissions system faults for later retrieval. 4 The devices warn drivers of problems through the "check engine" lights placed on the dashboards of new cars.

These lights illuminate when the vehicle's monitoring system detects an engine malfunction. At the same time the light illuminates, trouble codes indicating the source of the problem are stored in the vehicle's computer, where they may be accessed by repair personnel, sometimes using a plug-in tool to aid in diagnosis.

Control of Air Pollution from New Motor Vehicles, 56 Fed.Reg. 48,272, 48,274 (1991) (proposed Sept. 24, 1991).

In 1990 Congress amended the CAA to require EPA to mandate and regulate the installation of OBDs in all new cars. See CAA Amendments, P.L. No. 101-549, § 202(m), 104 Stat. 2399 (codified at 42 U.S.C. § 7521(m) (Supp. V 1993)). Through the use of these devices, Congress sought accurate identification of "emission-related systems deterioration or malfunction," in order to "alert[ ] the vehicle's owner or operator to the likely need for emission-related ... maintenance or repair." CAA § 202(m)(1), 42 U.S.C. § 7521(m)(1). Congress also hoped to "facilitate the ability of repair facilities, including independent repair facilities, to properly diagnose emission component malfunctions." 5 In order "to assure that all vehicle manufacturers use [OBDs] that can be readily accessed and interpreted," 6 Congress instructed EPA to promulgate regulations that

requir[e] (subject to the provisions of section 7542(c) of this title regarding the protection of methods or processes entitled to protection as trade secrets) manufacturers to provide promptly to any person engaged in the repairing or servicing of motor vehicles ... any and all information needed to

Page 454

make use of the emission control diagnostics system....

CAA § 202(m)(5), 42 U.S.C. § 7521(m)(5). The statute also requires

(A) that any connectors through which the emission control diagnostics system is accessed for inspection, diagnosis, service, or repair shall be...

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126 practice notes
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    • Federal Register October 13, 2005
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    ...analysis only when small entities will be subject to the requirements of the rule. See Motor and Equip. Mfrs. Ass'n v. Nichols, 142 F.3d 449 (D.C. Cir. 1998); United Distribution Cos. v. FERC, 88 F.3d 1105, 1170 (D.C. Cir. 1996); Mid-Tex Elec. Co-op, Inc. v. FERC, 773 F.2d 327, 342 (D.C. Ci......
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