In the wake of the Supreme Court’s decision in Loper Bright Enters. v. Raimondo, 244 S.Ct. 2244 (2024), the general breadth and scope of agency decision-making has been called into question. In its recent decision, Huntsman Petrochemical LLC v. EPA, No. 23-1045, 2024 WL 3763355 (D.C. Cir. Aug. 13, 2024), the D.C. Circuit has made it clear that where statutory interpretation is not implicated, the Court will continue to afford EPA’s conclusions involving technical expertise a significant degree of deference. While neither the parties nor the Court attempted to address or reference Loper Bright, the Court articulated a clear standard applicable to agency actions involving statistical and modeling analyses: the Court will examine each step of an agency’s analysis to satisfy themselves that the agency has not “departed from a rational course.” Only where a statistical model “bears no rational relationship to the characteristics of data to which it was applied” will agency action be deemed arbitrary and capricious. Accordingly, regulated entities should be aware that the concept of deference lives on when challenging agency decision-making, even in the wake of the fall of Chevron Deference. Read More »

Share | Email| Comments|  Topics: Air, Chevron Deference, Clean Air Act, D.C. Circuit, Emissions, EPA, HAPs, Hazardous Air Pollutants, Rulemaking

In Sackett v. EPA, 2023 WL 3632751 (U.S. May 23, 2023), the Supreme Court limited the authority of the United States Environmental Protection Agency (“EPA”) to regulate wetlands by embracing a “continuous surface connection test” to determine if adjacent wetlands are subject to the Clean Water Act (“CWA”) and explicitly rejecting Justice Kennedy’s “significant nexus” test from Rapanos v. United States, 547 U.S. 715, 754 (2006). While the 9-0 decision was unanimous in judgment by holding that the Sacketts’ wetland was not subject to federal jurisdiction, the court was sharply divided as to the test to determine when an adjacent wetland qualifies as a Water of the United States (or “WOTUS”).  A five-justice majority held that the CWA’s jurisdiction includes only adjacent wetlands that are indistinguishable from WOTUS due to a continuous surface connection. Under this framework, for an adjacent wetland to be subject to CWA jurisdiction, the adjacent body of water must constitute a WOTUS, and the adjacent wetland must have a continuous surface connection with the WOTUS such that it is difficult to determine where the body of water ends and the wetland begins.  The majority’s holding casts serious doubt on the continuing viability on the final WOTUS rule that became effective earlier this year and relied in part on the “significant nexus” test that EPA and the United States Army Corps have applied through guidance since the Rapanos decision. See 88 Fed. Reg. 3004 (Jan. 18, 2023). Read More »

Share | Email| Comments|  Topics: Clean Water Act, Decisions of Note, EPA, Major Questions Doctrine, Navigability, Ninth Circuit, Rapanos, Supreme Court, United States Supreme Court, Wetlands

EPA’s Clean Air Act (“CAA”) rulemakings directed at power plants are often the target of regulatory challenges in federal court.  EPA’s latest rulemaking regulating Hazardous Air Pollutant (“HAP”) emissions from coal- and oil-fired electric utility steam generating units (“EGUs”) is unlikely to be an exception. 88 Fed. Reg. 13956 (Mar. 6, 2023).  In the now final rule, EPA has revoked an earlier action taken in 2020, in which the agency declined to regulate HAP emissions from EGUs after comparing the costs of compliance relative to the benefits of regulation, relying at the time on the Supreme Court’s decision in Michigan v. EPA, 576 U.S. 743 (2015).  Id. at 13957; see also 85 Fed. Reg. 31286. Now, just three years later under a new administration, the agency has backtracked, finding that it is appropriate and necessary to regulate HAP emissions from EGUs based on new data regarding the costs and benefits of regulating HAP emissions.  EPA claims that its latest decision is actually more in line with the statutory factors identified in Michigan for determining whether it is “appropriate and necessary” to regulate HAP emissions from EGUs under the CAA. Read More »

Share | Email| Comments|  Topics: Air, Clean Air Act, EPA, HAPs, Hazardous Air Pollutants, Rulemaking

This post was authored by summer associate Kelly Hanna.

In Daikin Applied Americas, Inc. v. EPA, the D.C. Circuit Court of Appeals sided with the U.S. Environmental Protection Agency (“EPA”) by holding that a groundwater plume can be listed as a Superfund Site on the National Priorities List (“NPL”) pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9601 et seq., even if the sources of contamination are not clearly identified. No. 20-1479, 2022 WL 2565083 (D.C. Cir. July 8, 2022). The Court also held that substantial evidence exists to support aquifer interconnectivity so long as observed releases occur at each aquifer. Thus, EPA’s decision to list a “groundwater plume with no identified source” that spanned multiple aquifers in an area southwest of Minneapolis, Minnesota on the NPL survived both arbitrary and capricious and substantial evidence challenges. Read More »

Share | Email| Comments|  Topics: CERCLA, EPA, Groundwater, National Priorities List, Superfund

This post was authored by Trang Do, a summer associate.

In West Virginia v. EPA, the Supreme Court limited the authority of the United States Environmental Protection Agency (EPA) to reduce greenhouse gases by setting emission guidelines for existing power plants, characterizing the energy generation shifting strategy proposed in the Clean Power Plan (CPP) as an overreach of the agency’s power. In a 6-3 decision, with the three liberal justices dissenting, the Court held that the authority to adopt a regulatory program that would significantly alter how the nation’s energy is generated fell under an “extraordinary case” of the major questions doctrine. West Virginia v. EPA 597 U. S. ____ (2022). The major questions doctrine requires that a federal agency have “clear congressional authorization” when acting on issues of great “economic and political significance.” Id. (citing Utility Air Regulatory Group v. EPA, 573 U. S. 302, 324). Read More »

Share | Email| Comments|  Topics: Clean Air Act, Climate Change, Decisions of Note, Electric, Emissions, Energy, EPA, Greenhouse Gas, Legislation, Refinery, Rulemaking, Supreme Court, West Virginia

On November 17, 2021, the Court of Appeals for the First Circuit affirmed a decision of the lower court that the Puerto Rico Industrial Development Company (PRIDCO) was prima facie liable under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 U.S.C. § 9601 et seq., that it could not avail itself of the contiguous property owner defense, and that the selected response action was not arbitrary or capricious.  The decision is particularly noteworthy in that the only identified contamination was in the groundwater under PRIDCO’s property, with no evidence that the source of the contamination was any activity on PRIDCO’s property.  Nevertheless, the Court held that because the movement of groundwater constitute a continuous “release,” CERCLA liability attached. Read More »

Share | Email| Comments|  Topics: CERCLA, Contamination, Cost Recovery, EPA, First Circuit, Groundwater, Innocent Party, National Contingency Plan, Owner Liability, Solvents, Superfund

On June 25, 2021, the Supreme Court, reversing the Tenth Circuit, held that a small refinery that had previously received an exemption from certain requirements of the renewable fuel standard (“RFS”) program was eligible for an extension of that exemption, even if it had had a lapse in coverage in previous years. See HollyFrontier Cheyenne Refining, LLC, v. Renewable Fuels Association, et al., Slip Op. 20-472 (June 25, 2021). Petitioners, three small fuel refineries, had each applied for a hardship exemption under the RFS program, and the Environmental Protection Agency (“EPA”) had granted each request. Those exemptions were then challenged by a group of renewable fuel producers. The Tenth Circuit ultimately sided with the renewable fuel producers, holding that because each refinery had allowed its previously held exemption to lapse at times in the past, each was no longer eligible to receive an extension of the original exemption. After hearing oral argument in April 2021, the Supreme Court reversed the Tenth Circuit and held that the text of the statute does not require that the exemption be continually held in order to remain valid. Read More »

Share | Email| Comments|  Topics: Energy, EPA, Oil and Gas, Pipelines, Refinery, Renewable Fuel Standard, Supreme Court, Tenth Circuit, United States Supreme Court

On December 10, 2020, Christmas came early for the federal government. In United States v. Shell Oil Company (CV 91-00589-CJC), the Central District of California awarded it nearly $50 million in costs to remediate waste generated by oil companies that produced World War II aviation fuel at the McColl Superfund Site in Fullerton, California. Though their liability had already been established in a 1993 Second Circuit decision, the companies sought to raise triable issues of fact on damages, and they also contended that the government’s statutory basis under CERCLA was improper. But the Court rejected these arguments and granted the government’s motion for summary judgment. Read More »

Share | Email| Comments|  Topics: Allocation, California, CERCLA, Cleanup, Cost Recovery, EPA, Oil and Gas, Superfund

Last week the Third Circuit held that Combustion Equipment Associates, Inc. n/k/a Carter Day Industries, Inc. (“Carter Day”) was not protected from a contribution claim brought by Compaction Systems Corporation of Connecticut, Inc. and Compaction Systems Corporation (collectively, “Compaction”) for amounts Compaction was obligated to pay to the United States despite Carter Day having resolving its liability to the State of New Jersey for the same site. New Jersey Department of Environmental Protection v. American Thermoplastics Corporation, et al., Nos. 18-2865 & 19-2243 (3d. Cir. Sept. 8, 2020). At issue was whether the settlement agreement between Carter Day and the New Jersey Department of Environmental Protection (“NJDEP”) addressed the same “matter” as the contribution claim brought by Compaction for response costs at the Combe Fill South Landfill Superfund Site (the “Combe Fill Site” or “Site”). Read More »

Share | Email| Comments|  Topics: CERCLA, Contamination, Contribution, EPA, Landfill, New Jersey, Remediation, Superfund, Third Circuit

Last month, a bare majority of the Supreme Court held in Kisor v. Wilkie, No. 18-15, 588 U.S. ___, that federal courts should still defer to an agency’s interpretation of its own regulations, a practice known as Auer deference, but only sometimes. In doing so, the Supreme Court narrowed the circumstances in which Auer deference is warranted by adopting a new five-part test that must be satisfied for it to apply. The decision has important ramifications for environmental practitioners because of the significance of regulations in environmental law. Read More »

Share | Email| Comments|  Topics: Auer Deference, Decisions of Note, Enforcement, EPA, Supreme Court, United States Supreme Court