United States v. Luminant Generation Co.

Citation905 F.3d 874
Decision Date01 October 2018
Docket NumberNo. 17-10235,17-10235
Parties UNITED STATES of America, Plaintiff - Appellant Sierra Club, Intervenor Plaintiff - Appellant v. LUMINANT GENERATION COMPANY, L.L.C.; Big Brown Power Company, L.L.C., Defendants - Appellees
CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)

Robert Joel Lundman, U.S. Department of Justice, Environment & Natural Resources Division-Appellate Section, Washington, DC, Daniel S. Smith, U.S. Department of Justice, Environment & Natural Resources Division, Washington, DC, for Plaintiff - Appellant UNITED STATES OF AMERICA.

Joshua Smith, Sierra Club, Environmental Law Program, Oakland, CA, David A. Nicholas, Newton, MA, for Intervenor Plaintiff - Appellant SIERRA CLUB.

Philip Stephen Gidiere, III, Esq., Balch & Bingham, L.L.P., Birmingham, AL, Russell Harris Falconer, Attorney, Michael L. Raiff, Esq., Gibson, Dunn & Crutcher, L.L.P., Dallas, TX, Daniel Jude Kelly, Associate General Counsel, Vistra Energy Corporation, Dallas, TX, for Defendants - Appellees.

Before JOLLY, DENNIS, and ELROD, Circuit Judges.

E. GRADY JOLLY, Circuit Judge:

Today we are presented with claims brought by the United States asserting that Luminant Generation Company and Big Brown Power Company violated the Clean Air Act by failing to obtain a statutorily mandated preconstruction permit for the modification of their facilities. The government seeks civil penalties and injunctive relief. Because the government filed its action more than five years after construction began on the facilities, the district court dismissed the government’s civil-penalty and injunctive-relief claims as time barred under Federal Rule of Civil Procedure 12(b)(6). The court also held that the injunctive-relief claims were subject to dismissal under Rule 12(b)(1) for lack of jurisdiction.

We join the other circuits in holding that such an action to recover civil penalties for violation of the Preconstruction requirements for major emitting facilities under 42 U.S.C § 7475(a) must be brought within five years of the first day of the alleged construction period. Because the government waited more than five years to file the instant suit, its legal claims are time barred. Therefore, we affirm dismissal of the legal claims.

But the government also asks for injunctive relief. We hold that the government, in its sovereign capacity, is exempted from the concurrent-remedies doctrine. We reach this conclusion because, generally, government claims, brought in its sovereign capacity, are not subject to any limitations period, unless Congress expresses its clear consent thereto. Here, the only applicable statute of limitations makes no reference to injunctive relief. Thus, the statute of limitations does not apply to the government’s claims for injunctive relief that are not civil fines, penalties, or forfeitures. Finally, we find no support for the district court’s assumption that it was without jurisdiction to entertain any injunctive relief based on past violations of § 7475(a). Of course, that is not to say that the government is entitled to injunctive relief here. We hold only that the district court is not barred by the statute of limitations, nor by the absence of jurisdiction, from further considering whether equitable relief may in some form be available to the government. We remand the injunctive-relief claims to the district court for further consideration.


The Clean Air Act ("CAA"), through the Prevention of Significant Deterioration Program,1 mandates the following two "Preconstruction requirements," codified at 42 U.S.C § 7475(a), that are central to this appeal:

No major emitting facility on which construction is commenced after August 7, 1977, may be constructed ... unless--
(1) a permit has been issued for such proposed facility ... setting forth emission limitations ...;
(4) the proposed facility is subject to the best available control technology ["BACT"] for each pollutant subject to regulation ....

42 U.S.C. § 7475(a) (2012). In other words, proposed facilities require a permit to begin construction, and those proposed facilities must be "subject to" the BACT in order to get a permit.2 Each state must adopt a state implementation plan ("SIP") to meet these goals, and Texas’s SIP, which the EPA has approved, requires "Permits for New Construction or Modification."3

Important here, major emitting facilities built before August 1977 do not escape the Preconstruction requirements because the term "construction" "includes the modification" of a facility. 42 U.S.C. § 7479. "Modification" is defined as "any physical change in, or change in the method of operation of a stationary source which increases the amount of any air pollutant emitted by such source or which results in the emission of any air pollutant not previously emitted." Id. § 7411. In short, all pre-1977 major emitting facilities must comply with the § 7475(a) permit requirements before undergoing a physical change or change in operation that increases pollution above a set floor.

Now for the facts. We are concerned today with two power-plant facilities built before 1977, each of which houses multiple power-generating units. The first is the Martin Lake Power Plant, owned and operated by defendant Luminant Generation Company, LLC. And the second is the Big Brown Power Plant,4 owned by Big Brown Power Company, LLC, and operated by Luminant (collectively, "the defendants").5

The district court did not address and the defendants do not contest on appeal whether the defendants’ facilities were required to comply with the § 7475(a) Preconstruction requirements, so we proceed on the basis that they were.6 And at this early stage of the litigation, we must assume the defendants constructed their respective facilities without a permit or ensuring the post-construction facilities would be subject to BACT. In response to these alleged violations, the government took legal action on August 16, 2013, filing suit in Texas federal court. The government alleged that the defendants violated, and are continuing to violate, the § 7475(a) Preconstruction requirements and Texas SIP by (1) having constructed their facilities without obtaining the requisite permit and (2) operating without a permit and continuously failing to meet BACT emission limitations.7

Dates are important here. The original complaint alleges nine CAA violations, the following six of which are violations of the § 7475(a) Preconstruction requirements:

(1) Martin Lake Unit 1 underwent major capital projects from March 4, 2006April 13, 2006 without a permit.
(2) Martin Lake Unit 2 underwent major capital projects from February 16, 2007April 5, 2007 without a permit.
(3) Martin Lake Unit 3 underwent major capital projects from February 26, 2005April 2, 2005 without a permit.
(4) Martin Lake Unit 1 underwent major capital projects from March 1, 2009April 1, 2009 and "at or near the same time ... Luminant changed the method of operation of the boiler" without a permit.
(5) Martin Lake Unit 3 underwent major capital projects from February 10, 2008April 5, 2008 and "at or near the same time ... and/or within about a year thereafter, Luminant changed the method of operation of the boiler" without a permit.
(6) Big Brown Unit 2 underwent major capital projects from October 15, 2005November 13, 2005 without a permit.

According to the government, these "unlawful major modifications" of major emitting facilities caused "significant amounts of SO2 and NOx pollution." As to each claim, the government asks for civil penalties and injunctive relief under 42 U.S.C. § 7413(b).8

The defendants moved to dismiss § 7475(a) claims one, two, three, five, and six (not four) as time barred, arguing that the alleged unpermitted construction periods occurred outside the five-year statute of limitations, i.e. before August 16, 2008. In response, the government primarily argued that claims under § 7475(a) do not need to be brought within five years of construction because the Preconstruction requirements apply to constructing a facility and operating it. Thus, according to the government, each day a post-construction facility operates without a permit or BACT is a new, discrete § 7475(a) violation. In a footnote, the government also argued that it pleaded a construction in claim five—a change in the method of operation of the boiler—that occurred as late as April 2009, which falls within the limitations period. So even if § 7475(a) claims accrue at the time of construction, the government argued that the boiler-operation allegation in claim five should have nevertheless survived.

The district court acknowledged the government’s argument that the boiler-operation allegation fell within the five-year period but, without further explanation, found that claim five accrued more than five years before suit was filed. Ultimately, the district court agreed with the defendants that the government’s claims "first accrued on the modification start dates," and dismissed claims one, two, three, five, and six (civil penalties and injunctive relief) as time-barred under Federal Rule of Civil Procedure 12(b)(6). The court also found that the claims for injunctive relief, as reflected in the complaint, were subject to dismissal under Rule 12(b)(1).

After the district court’s dismissal ruling, only the government’s fourth § 7475(a) claim and an additional procedural claim survived. Once Sierra Club intervened as of right, joining the government as plaintiff (collectively, "the plaintiffs"), the plaintiffs then filed a second amended complaint withdrawing the surviving claims. The district court entered final judgment for the defendants. The plaintiffs now appeal the district court’s judgment dismissing all claims. But they challenge only the dismissal of the first, second, third, fifth, and sixth § 7475(a) claims.

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