Weiler v. Chatham Forest Products, Inc.

• Decision Date: 04 June 2004
• Docket Number: Docket No. 02-9500.
• Parties: James F. WEILER, Sandra L. Weiler, Kimberely Dewey, Ann Martin, Charlene Poore, Kenneth Poore, Kenneth C. Poore, Jr., Clem Coryer, Mary Coryer, Marie E. Craven, Sheila House, Phillip Dority, Pamela Dority, Gregory A. Mills, Nancy Mills, Robert Woodard, Lisa Woodard, H.A. Patterson, Brian T. Patterson, Gary Mallette, and Ernestine M. Rieck, Plaintiffs-Appellants, v. CHATHAM FOREST PRODUCTS, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Second Circuit

392 F.3d 532

James F. WEILER, Sandra L. Weiler, Kimberely Dewey, Ann Martin, Charlene Poore, Kenneth Poore, Kenneth C. Poore, Jr., Clem Coryer, Mary Coryer, Marie E. Craven, Sheila House, Phillip Dority, Pamela Dority, Gregory A. Mills, Nancy Mills, Robert Woodard, Lisa Woodard, H.A. Patterson, Brian T. Patterson, Gary Mallette, and Ernestine M. Rieck, Plaintiffs-Appellants, v. CHATHAM FOREST PRODUCTS, INC., Defendant-Appellee.

Docket No. 02-9500.

United States Court of Appeals, Second Circuit.

Argued September 26, 2003.

Decided June 4, 2004.

Amended December 8, 2004.

Robert Ukeiley, Georgia Center for Law in the Public Interest, Atlanta, GA, for Appellants.

Ruth E. Leistensnider, Albany, N.Y. (Nixon Peabody, Albany, NY, of counsel), for Appellee.

Eliot Spitzer, Attorney General of the State of New York, Caitlin J. Halligan, Solicitor General, Denise A. Hartman, Assistant Solicitor General, Lisa M. Burianek, Assistant Attorney General, State of New York, Albany, NY, on the brief, for Amicus Curiae New York State Department of Environmental Conservation.

Before: MESKILL, KATZMANN and RAGGI, Circuit Judges.

MESKILL, Circuit Judge.¹

Appeal from the judgment of the United States District Court for the Northern District of New York, Scullin, J., dismissing the case for failure to state a cause of action under the Clean Air Act.

Reversed and remanded.

This appeal requires us to consider whether section 304(a)(3) of the Clean Air Act, 42 U.S.C. § 7604(a)(3), allows a private litigant to sue in federal court to challenge the determination of the New York State Department of Environmental Conservation (N.Y.DEC) that the defendant may proceed with the construction of a factory without obtaining a particular permit.

Defendant-appellee Chatham Forest Products, Inc. (Chatham) proposes to build and operate an "oriented strand board manufacturing" factory in Lisbon, New York. The manufacture of strand board produces pollutants that may be emitted into the atmosphere. According to the plaintiffs-appellants, a group of citizens who live and work in the vicinity of Lisbon, Chatham did not obtain the permit required prior to construction of the proposed factory. Chatham concedes that it has not obtained the permit identified by the plaintiffs, a so-called "major source" permit. However, it maintains that the NYDEC, in issuing a different permit, conclusively determined that no major source permit is required, and that the plaintiffs may not sue in federal court to challenge the NYDEC's decision. The judge below held that federal judicial review is prohibited under the circumstances and dismissed the case for failure to state a cause of action. We reverse and remand.

BACKGROUND

Because the facts of the case are somewhat technical in nature and intimately intertwined with the Clean Air Act's specific provisions, it is necessary to first lay out its basic frame work as it relates to this case.

1. The Clean Air Act

The Clean Air Act, 42 U.S.C. §§ 7401-7671q (2000) (the Act), created a complex and comprehensive legislative scheme to protect and improve the nation's air quality. See Sierra Club v. Larson, 2 F.3d 462, 464 (1st Cir.1993).

Broadly speaking, Title I of the statute regulates stationary sources of pollution and Title II regulates mobile sources, most importantly motor vehicles. For specified pollutants, national air quality standards are promulgated by the EPA. 42 U.S.C. § 7409. Whether new construction of polluting facilities is permitted in an area, and what kind of controls are required, depends on whether the area is below or above the standard for each pollutant.

Id.

An entity proposing to construct a major emitting source of pollutants must obtain a permit prior to construction. See 42 U.S.C. §§ 7475(a), 7502(c)(5). Part C of subchapter I of the Act (Part C), 42 U.S.C. §§ 7470-7492, governs requirements in geographical areas where the standard has been attained; Part D of subchapter I of the Act (Part D), 42 U.S.C. § 7501-7515, applies to so-called nonattainment areas.

The Act defines a "major emitting facility" as "any stationary facility ... which directly emits, or has the potential to emit" the relevant quantity of pollutant as established by the Environmental Protection Agency (EPA). 42 U.S.C. § 7602(j) (emphasis added). In turn, the EPA defines "potential to emit" to mean:

[T]he maximum capacity of a stationary source to emit a pollutant under its physical and operational design. Any physical or operational limitation on the capacity of the source to emit a pollutant, including air pollution control equipment and restrictions on hours of operation or on amount of material combusted stored, or processed, shall be treated as a part of its design only if the limitation or the effect it would have on emissions is federally enforceable.

40 C.F.R. § 52.24(f)(3) (2004) (emphasis added).

However, the District of Columbia Circuit held that this standard was unreasonable because it failed to include mechanisms that are practically effective, even if not "federally enforceable," in the determination of a facility's "potential to emit." See National Mining Ass'n v. EPA, 59 F.3d 1351, 1363-65 (D.C.Cir.1995) (finding a parallel definition of "potential to emit" unreasonable). In response, the EPA issued an "interim policy," explaining that "the term `federally enforceable' should now be read to mean `federally enforceable or legally and practicably enforceable by a state or local air pollution control agency.'" EPA Interim Policy on Federal Enforceability of Limitations on Potential to Emit, at 3-4 (Jan. 22, 1996), available at http://www.epa.gov/ttn/oarpg/t5/memoranda/pte122.pdf (last visited Jan. 12, 2004).

In short, then, a proposed facility that is physically capable of emitting major levels of the relevant pollutants is to be considered a major emitting facility under the Act unless there are legally and practicably enforceable mechanisms in place to make certain that the emissions remain below the relevant levels.

2. State Implementation

The Act "places the primary responsibility for enforcement on state and local governments." N.Y. Pub. Interest Research Group v. Whitman, 321 F.3d 316, 320 (2d Cir.2003). In keeping with this principle, the EPA does not itself issue major source construction permits required by Part D of the Act. Rather, each state is directed to adopt and submit to the EPA for approval a state implementation plan (SIP) to implement and promote the policies and goals of the Act. The SIP must designate a state agency or its delegates to review applications for major source construction permits under Part D and to monitor compliance with the permit once a facility has begun operation. See 42 U.S.C. §§ 7410(a), 7471, 7502(b) & (c), 7503.

Under the New York SIP permit scheme, which has been approved by the EPA, see N.Y. Pub. Interest Research Group, 321 F.3d at 319, a factory that has the capacity to emit major levels of particular pollutants may avoid the stringent permit requirements of Part C and Part D and proceed as a "minor emitting facility" if it agrees to "cap" its pollution output. If it does so, it may receive a "synthetic minor" source permit. See N.Y. Comp.Codes R. & Regs. tit. 6, §§ 201-7.1 — 201-7.2. The NYDEC administers New York's SIP.

3. The Facts of the Case and the Question Presented

In this case, the Chatham factory was approved by the NYDEC under the synthetic minor source permit scheme because the NYDEC concluded that the mechanisms in place to limit the pollution output would be effective and enforceable. The plaintiffs allege that the factory must be considered a major emitting facility under the Act because the mechanisms put in place to limit pollution are neither practically effective nor enforceable. For instance, plaintiffs argue that the pollution output monitoring scheme does not adequately account for pollutants emitted during startup and shutdown of factory operations. They allege further that upstate New York is a nonattainment area for several of the pollutants that will be emitted by the factory. As a consequence, they maintain that Chatham must comply with the demanding permit requirements of Part D of the Act, and that a synthetic minor source permit is not sufficient.

They sued under section 304(a)(3) of the Act, which states:

[A]ny person may commence a civil action on his own behalf — ... (3) against any person who proposes to construct or constructs any new or modified major emitting facility without a permit required under part C of subchapter I of this chapter ... or part D of subchapter I of this chapter (relating to nonattainment) or who is alleged to have violated (if there is evidence that the alleged violation has been repeated) or to be in violation of any condition of such permit.

42 U.S.C. § 7604(a)(3).

The judge below held that this section does not allow a private litigant to sue in federal court to challenge the NYDEC's determination that no major source permit is necessary.

DISCUSSION

Our review of the district court's holding that plaintiffs have failed to state a cause of action is de novo. Phillip v. University of Rochester, 316 F.3d 291, 293 (2d Cir.2003).

We begin our analysis, of course, with the text of the statutory provision in question, namely, section 304(a)(3)'s citizen suit provision. As stated previously, it provides that any person may sue a "person who proposes to construct... any ... major emitting facility without a permit required under part C ... or part D." 42 U.S.C. § 7604(a)(3). The plaintiffs have alleged that the proposed factory will be a major emitting facility within the meaning of the Act and that Chatham has not obtained the permits required by Part D for major emitting facilities. These factual allegations, if proven, appear to be sufficient under the language of the provision to allow the plaintiffs to succeed in their effort to halt the construction of the factory. At this stage...