Supreme Court Clean Air Fight Could Pry Disputes From Washington

A US Supreme Court fight over two major clean air regulations has the potential to limit the EPA’s ability to defend rules with state plan components at the D.C. Circuit, according to attorneys.

The justices on Monday agreed to hear venue battles in petitions against the Environmental Protection Agency’s traveling ozone and renewable fuel standards, taking up questions about which court is best to handle disputes over national rules that rely on individual state plans.

The question hinges on whether rules that are implemented on a state-by-state basis are “nationally applicable,” meaning they should be heard by the US Court of Appeals for the District of Columbia Circuit.

But state and industry challengers say regional circuits should decide the outcome.

“It is a slippery slope, as the DC Circuit has been the circuit designated to hear such matters,” Daniel Cotter, Dickinson Wright PLLC member, said in an email. “The Court’s arguments and then decisions on these questions potentially will have some far reaching consequences, including the cost and potential for inconsistencies as the dissent pointed out.”

‘Slippery Slope’

In November 2023, the US Court of Appeals for the Fifth Circuit vacated the EPA’s denial of requests from six small refineries asking for exemptions from its renewable fuel standard program.

The panel said the exemption actions are “‘neither nationally applicable nor based on a determination of nationwide scope or effect,’” which kept the case out of the D.C. Circuit—prompting the EPA to seek answers from the Supreme Court.

The EPA is on the other side of the aisle in the ozone case, which was launched by critics of the “Good Neighbor” ozone rule when their case was sent to Washington by the US Court of Appeals for the Tenth Circuit in February.

The parties in both petitions are asking the high court to determine if the D.C. Circuit should be the exclusive venue for the cases, where agencies have a bit more of an advantage.

Bracewell LLP partner Jeff Holmstead said he wasn’t surprised that the Supreme Court decided to hear the renewable fuel case because there are circuit splits on the issue, historically “one of the factors, and maybe the most important factor, that the Supreme Court considers.”

Holmstead predicts that the high court is more likely to allow the cases to be heard in the regional circuits, saying the language of the Clean Air Act doesn’t support lumping all of the cases together in the D.C. Circuit.

“It may be true that EPA is using the same standards for everybody, but applying those standards should lead to different results based on, you know, within an individual state implementation plan,” he said.

Uniform Review

Oklahoma Attorney General Gentner Drummond lauded the justices’ decision to take up the state’s ozone petition, and biofuel groups also said they “look forward” to participating in a case that will settle the venue dispute for RFS fights.

But environmentalists balked at state and industry litigation that seeks to take cases like the Good Neighbor battle out of the national venue.

“The agency’s disapprovals were grounded in multiple legal and technical determinations that have effects across the country and were applied with a uniform methodology to all affected states,” Environmental Defense Fund General Counsel Vickie Patton said in a statement.

Tracy Hester, environmental professor at the University of Houston Law Center, says it makes sense that the D.C. Circuit provides a single, clear directive as a court of uniform review in cases like these, rather than sorting out potential circuit splits.

The D.C. Circuit “has been deferential to expertise—and its sophistication and familiarity with an array of issues allows it the bandwidth to consider some more complex issues, which might be a steeper climb for other circuits,” Hester said.

The cases are PacifiCorp v. EPA, U.S., No. 23-1068, cert granted 10/21/24, Oklahoma v. EPA, U.S., cert granted 10/21/24, and EPA v. Calumet Shreveport Ref’g LLC, U.S., No. 23-1229, cert granted 10/21/24.