Public Service Co. of Indiana, Inc. v. U.S. E.P.A.
| Decision Date | 25 June 1982 |
| Docket Number | No. 81-1241,81-1241 |
| Citation | 682 F.2d 626 |
| Parties | , 12 Envtl. L. Rep. 20,928 PUBLIC SERVICE COMPANY OF INDIANA, INC., Plaintiff-Appellant, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY and Douglas M. Costle, Defendants-Appellees. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Bryan G. Tabler, Barnes, Hickam, Pantzer & Boyd, Indianapolis, Ind., for plaintiff-appellant.
Patrick J. Cafferty, Dept. of Justice, Washington, D. C., for defendants-appellees.
Before BAUER and WOOD, Circuit Judges, and CAMPBELL, Senior District Judge. *
Appellant, Public Service Company of Indiana (hereafter PSI) brought this action in District Court contesting the appellees', the Environmental Protection Agency and its On March 6, 1979, an authorized inspector for the EPA requested permission to inspect PSI's facility in Gibson County, Indiana (hereafter "the Gibson Station"). The inspector was denied admittance because he refused to sign a "Visitor's Admission Agreement" which contained a waiver of liability provision. On May 17, 1979, two EPA employees were again denied admission to a PSI facility, the Wabash River Generating Station (hereafter the "Wabash River Station") because they declined to sign a similar "Visitor's Admission Agreement."
Administrator Douglas M. Costle (hereafter "the EPA," "the agency," or "the Administrator"), acquisition and utilization of certain inspection warrants. The warrants were issued by a United States Magistrate based upon sworn allegations of possible violations of the Clean Air Act, 42 U.S.C. § 7401 et seq., at two of PSI's facilities. The appellant contends that the warrants were issued without probable cause and that the inspections authorized thereby were excessively broad. After a hearing, the District Court granted summary judgment for the defendants. PSI then filed this appeal.
Subsequently, the EPA applied to United States Magistrate J. Patrick Endsley for the issuance of warrants authorizing the inspection of those facilities. The application for the Wabash River Station was supported, inter alia, by the affidavit of David Schulz, an EPA inspector, in which he stated that stack tests and other monitoring data indicated possible violations of the Indiana State Implementation Plan, i.e. emissions in excess of the particulate emissions limitation. (Regulation APC-4R) and the opacity limitation (Regulation APC-3). In support of the warrant for the Gibson Station, the EPA also submitted an affidavit of David Schulz which stated that certain monitoring data indicated possible violations of Regulation APC-3. Magistrate Endsley issued the two warrants on January 7, 1980 and they were executed on the following two days.
After the inspections, PSI moved to quash the warrants but those motions were denied by Magistrate Endsley on April 1, 1980. This action was then filed in District Court seeking declaratory and injunctive relief. PSI sought a declaratory judgment determining that:
(1) Indiana's Regulation APC-3 is not enforceable; (2) there was no probable cause for issuance of the warrants (because APC-3 is not federally enforceable); (3) the warrants authorized overly broad inspections; and (4) the warrants did not authorize the seizure or demand of documents stored at locations other than those specifically authorized for inspection. 1 PSI also requested injunctive relief preventing future inspections and enforcement actions resulting from information obtained pursuant to those warrants. As noted previously, the District Judge denied all the relief requested.
Prior to addressing the issues on appeal, a summary of the legal background of this case is necessary.
The Clean Air Act, 42 U.S.C. § 7401, et seq. (hereafter "The Act") authorizes the EPA to promulgate national primary and secondary ambient air quality standards designed to protect the public health and welfare, 42 U.S.C. § 7409(a)(1). However, the primary responsibility for the promulgation of regulations to implement, maintain and enforce these standards is given to the states, 42 U.S.C. § 7401(a)(3). The Act directs each state to submit to the EPA a State Implementation Plan (hereafter "SIP"), 42 U.S.C. § 7410(a)(1), which the Administrator must approve if the plan satisfies the criteria specified in 42 U.S.C. § 7410(a)(2)(A)-(K), 42 U.S.C. § 7410(a)(2). The agency is authorized to promulgate additional or substitute provisions for a state's SIP if a satisfactory plan is not submitted, 42 U.S.C. § 7410(c)(1). The Act contemplates that the states will periodically revise their SIPs, see, inter alia, 42 U.S.C. § 7410(a)(2)(H), and any such revisions The specific standards used to determine whether a SIP or its revisions conform to the requirements of 42 U.S.C. § 7410(a)(2)(A)-(K) are contained in the agency's regulations, see 40 C.F.R. Part 51. The Administrator's approval actions on each state's SIP and its revisions are published in the Federal Register and are contemporaneously codified and incorporated into the agency's regulations, see 40 C.F.R. Part 52.
must be submitted to the Administrator for approval based on the criteria of 42 U.S.C. § 7410(a) (2)(A)-(K), 42 U.S.C. § 7410(a)(3)(A).
Pursuant to the statutory scheme, Indiana submitted its SIP to the EPA for approval in January of 1972. The Plan included, inter alia, a provision limiting the emission of particulate matter, labelled APC-4, 2 and a provision relating to opacity limitations, labelled APC-3. These regulations were approved by the EPA (with some minor modifications to APC-4 not relevant here) and thus became part of the federally enforceable SIP. In 1974, Indiana submitted to the EPA new and revised regulations, including a revision of APC-3. 3 Like its predecessor, the new version of APC-3 (hereafter the "1974 APC-3") mandated a maximum opacity limitation of 40% (Ringelmann No. 2). However, it included a new provision which permitted a fifteen minute exemption from that requirement for each 24-hour period.
The EPA published a notice summarizing the proposed regulations and soliciting comments, 40 Fed.Reg. 19210-19211 (May 2, 1975). Subsequently, the EPA published an order (hereafter the "October 1975 order") consisting of "final agency action" on six of the regulations, including the 1974 APC-3, 40 Fed.Reg. 50032-50033 (October 28, 1975). 4 While it is undisputed that the Administrator disapproved the 15 minute exemption, the approval status of the remainder of the regulation is the subject of controversy.
The EPA contends that it approved the 1974 APC-3 with the exception of the 15 minute limitation and that therefore the regulation is federally enforceable to that extent. 5 PSI contends that the 1975 order disapproved the 1974 APC-3 in its entirety. Appellant presents three arguments in support of its position: (1) that this court determined in Bethlehem Steel Corp. v. EPA, 638 F.2d 994 (7th Cir. 1980) that the EPA had not partially approved the 1974 APC-3 and therefore the agency is collaterally estopped from relitigating that issue; (2) that the EPA lacks the power to partially approve revisions to a state's SIP and thus the EPA's order cannot be so construed; and (3) that the language of the 1975 order can only be interpreted to effectuate a complete disapproval of that regulation. We shall address these issues seriatim.
PSI contends that the EPA is collaterally estopped from asserting that it partially approved the 1974 APC-3 because this Court held to the contrary on that identical issue in Bethlehem Steel, supra. It is, of course, settled law that for collateral estoppel to apply the issue must have been actually litigated in the prior suit, the court must have resolved the issue, and that resolution must have been necessary to the judgment, Continental Can Co. v. Marshall In Bethlehem Steel, this Court reviewed an EPA order which had disapproved the issuance of a Delayed Compliance Order (DCO) 6 to Bethlehem Steel by the Indiana Air Pollution Control Board. Bethlehem Steel had initiated the action pursuant to 42 U.S.C. § 7413(d)(2) contesting the EPA's action. In a thorough opinion, this Court rejected the six reasons relied on by the agency for disapproving the DCO and vacated the order.
603 F.2d 590 (7th Cir. 1979) ().
One of the alleged deficiencies noted by the EPA in disapproving the DCO was that the state had relied on a regulation that the EPA had partially disapproved. That is, the DCO cited Regulation APC-3 and the EPA concluded that this referred to the 1974 APC-3 which incorporated the disapproved 15 minute exemption. The EPA reasoned that it could not approve the DCO because it was not authorized by 42 U.S.C. § 7413(d)(1) to approve compliance with a requirement less stringent than the applicable SIP.
Bethlehem Steel argued that the EPA lacked the power to partially approve a state's SIP revisions and therefore the agency's action of the 1974 APC-3 must be treated as a complete disapproval of it. Consequently, Bethlehem Steel contended, the original APC-3 was a part of the applicable SIP and was the only enforceable version of that regulation. Under this reasoning, the EPA's approval of the DCO was not prohibited by 42 U.S.C. § 7413(d)(1).
The Court did not accept either party's position, stating:
"... even if we were to agree that the Administrator indeed has the authority to approve revisions partially, the record utterly fails to support that he in fact did so in this case. Furthermore, even if it had been established that he did so, the record fails to establish that the state did in fact apply the wrong APC-3 in the DCO. 638 F.2d at 1007.
While the DCO in issue did not specify which APC-3 the state applied, the Court determined that the circumstances strongly indicated that it was the 1974 version. However, the Court found no evidence that the 15 minute...
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