The opinion
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United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 26, 2004 Decided July 23, 2004
No. 02-1294
HONEYWELL INTERNATIONAL, INC.,
PETITIONER
v.
ENVIRONMENTAL PROTECTION AGENCY,
RESPONDENT
ATOFINA CHEMICALS, INC.,
INTERVENOR
On Petition for Review of an Order of the
Environmental Protection Agency
Angus Macbeth argued the cause for petitioner. With him
on the briefs were Timothy K. Webster and Richard E.
Ayres. Barry S. Neuman entered an appearance.
Thomas A. Lorenzen, Attorney, U.S. Department of Jus-
tice, argued the cause for respondent. With him on the brief
Bills of costs must be filed within 14 days after entry of judgment.
The court looks with disfavor upon motions to file bills of costs out
of time.
2
were Steven Edward Rusak, Attorney, Lisa M. Jaeger, Act-
ing General Counsel, U.S. Environmental Protection Agency,
and Jan M. Tierney, Attorney.
Sheila A. Millar argued the cause for intervenor ATOFI-
NA Chemicals, Inc. With her on the brief were Peter L. de
la Cruz and Jean-Cyril Walker.
Before: SENTELLE, RANDOLPH and ROGERS, Circuit Judges.
Opinion for the Court filed PER CURIAM.
Concurring opinion filed by Circuit Judge RANDOLPH, with
whom Circuit Judge SENTELLE joins.
Opinion concurring in part and dissenting in part filed by
Circuit Judge ROGERS.
PER CURIAM: The opinion of the court is presented in two
parts. In the first part, Judge Rogers writes for a unanimous
court to introduce the issues presented and to hold that
Honeywell International, Inc. has standing to challenge the
rule on review promulgated by the Environmental Protection
Agency (‘‘EPA’’). In the second part, Judge Sentelle writes
for himself and Judge Randolph on Honeywell’s challenge to
EPA’s reliance on economic considerations in promulgating
the rule on review, concluding that the rule must be vacated;
Judge Randolph writes on the remedy; and Judge Rogers
concurs in part and dissents in part, and would remand the
rule to EPA for further explanation.
PART I
ROGERS, Circuit Judge, writing in PART I the opinion of
the court: Title VI of the Clean Air Act (‘‘CAA’’), 42 U.S.C.
§§ 7671–7671q (2004), implements the policies and directives
of the Montreal Protocol on Substances that Deplete the
Ozone Layer, Sept. 16, 1987, 26 I.L.M. 1550 (entered into
force Jan. 1, 1989), in two ways relevant to this appeal: first,
by setting timetables for phasing out production and importa-
tion of chemicals that deplete the protective stratospheric
3
ozone layer, such as chlorofluorocarbons (‘‘CFCs’’) and hydro-
chlorofluorocarbons (‘‘HCFCs’’), and second, by identifying
substitutes for ozone-depleting substances thus phased out.
Among the industrial uses of CFCs and HCFCs is the
manufacture of foam products. In 1999 the Environmental
Protection Agency (‘‘EPA’’) designated HFC–245fa, a non-
ozone depleting hydrofluorocarbon (‘‘HFC’’) product devel-
oped by Honeywell International, Inc. (‘‘Honeywell’’), as an
acceptable listed substitute for HCFC–141b, an ozone-
depleting chemical scheduled to be phased out in 2003, for all
foam uses. Honeywell now challenges a final rule also autho-
rizing as substitutes for HCFC–141b the use of two ozone-
depleting chemicals — HCFC–22 and HCFC–142b — in
certain foam end-uses if technical constraints prevent use of
an approved listed alternative. Honeywell contends that
EPA exceeded its statutory authority and departed from its
policy without rational explanation by approving ozone-
depleting chemicals because EPA (1) failed to provide ade-
quate notice of its decision to approve HCFC–22 and HCFC–
142b where its rule had proposed the opposite; (2) had
previously approved substitutes that, in relative terms, pres-
ent a reduced risk to human health and the environment; and
(3) improperly considered potential economic impact when
rendering its final decision. EPA responds, as a threshold
matter, that Honeywell lacks standing, and on the merits,
that there was adequate notice, and that Honeywell miscon-
strues the effect of the listing of an approved substitute
chemical and ignores that continued use of ozone-depleting
chemicals under the rule turns only on technical feasibility
and not costs. On reply, Honeywell also contends that the
rule impermissibly delegates certain determinations to the
regulated end users. We hold that Honeywell has standing.
I.
Title VI of the Clean Air Act, 42 U.S.C. §§ 7671–7671q,
sets restrictions on the use of chemicals known to have ozone-
4
depleting properties as part of the implementation of a set of
policies aimed at protecting the ozone layer. Sections 604
and 605 of the CAA, id. §§ 7671c & 7671d, set timetables
phasing out, over time, most uses of ‘‘Class I’’ substances
(which include chlorofluorocarbons) and ‘‘Class II substances’’
(which include hydrochlorofluorocarbons). As many such
chemicals had been put to use in a wide array of commercial
applications, the CAA seeks to ensure the availability of
ozone-friendly replacements through § 612, id. § 7671k,
which establishes the ‘‘safe alternatives policy.’’ Section
612(a) provides that, ‘‘[t]o the maximum extent practicable,
class I and class II substances shall be replaced by chemicals,
product substitutes, or alternative manufacturing processes
that reduce overall risks to human health and the environ-
ment.’’ The Administrator of EPA is directed to take several
steps to promote this transition, such as recommending re-
search efforts to identify and develop alternatives for Class I
and Class II substances. See CAA § 612(b).
As relevant to Honeywell’s petition for review, the Admin-
istrator must also ‘‘promulgate rules TTT providing that it
shall be unlawful to replace any class I or class II substance
with any substitute substance which the Administrator deter-
mines may present adverse effects to human health or the
environment, where the Administrator has identified an alter-
native to such replacement that — (1) reduces the overall risk
to human health and the environment; and (2) is currently or
potentially available.’’ CAA § 612(c). The Administrator is
required to publish lists of substitute chemicals that are
prohibited or permitted for specific uses. Id. EPA has
implemented CAA § 612 through the Significant New Alter-
natives Program (‘‘SNAP’’), 40 C.F.R. §§ 82.170–82.184
(2004), which establishes criteria and procedures for listing
chemicals as approved substitutes for chemicals phased out
pursuant to the CAA. Under the SNAP program, substitutes
can be listed as ‘‘acceptable’’ or ‘‘unacceptable,’’ but the
regulations also contemplate that substitutes may be listed as
acceptable subject to ‘‘use conditions’’ (in which use of the
substitute is permitted if certain procedures to minimize
environmental and human risk are followed) or ‘‘use limits’’
5
(in which use of the substitute is permitted for a ‘‘narrowed
range of use TTT because of the lack of alternatives for
specialized applications’’). See id. § 82.180(b).
In 1993, EPA, acting pursuant to CAA § 606, 42 U.S.C.
§ 7671e, which authorizes the acceleration of statutory phase-
out dates, promulgated bans on the importation and produc-
tion of three Class II chemicals relevant to this petition:
HCFC–141b, HCFC–22, and HCFC–142b. 58 Fed Reg. 65,-
018, 65,028 (Dec. 10, 1993). The ban is effective in 2003 for
HCFC–141b, and in 2010 for HCFC–22 and HFCF–142b. Id.
However, in 1994, EPA also approved these three hydrochlo-
rofluorocarbons, in the interim, as alternatives, in foam uses,
to more ozone-damaging chlorofluorocarbons phased out pur-
suant to CAA Title VI. See 59 Fed. Reg. 13,044, 13,083
(March 18, 1994). In anticipation of the 2003 ban on the
importation and manufacture of HCFC–141b, Honeywell de-
veloped a non-ozone-depleting hydrofluorocarbon, HFC–
245fa, to function as a substitute for HCFC–141b in foam
applications. In 1999, EPA approved Honeywell’s petition to
list HCFC–245fa as an acceptable substitute for HCFC–141b
in all foam end uses. See 64 Fed. Reg. 68,039, 68,041 (Dec. 6,
1999).
The final rule followed upon intervenor ATOFINA Chemi-
cals, Inc.’s petition of February 17, 1999, requesting that
HCFC–22 and HCFC–142b, along with a third chemical,
HCFC–124, also be approved as acceptable substitutes for
HCFC–141b in foam applications. 65 Fed. Reg. 42,653, 42,-
656 (July 11, 2000). HCFC–22 and HCFC–142b were already
in use in several foam applications, due to EPA’s 1994 approv-
al of those chemicals as CFC substitutes, 59 Fed. Reg. at
13,083, and ATOFINA’s petition, if granted, would have
permitted their use as substitutes for HCFC–141b as well.
EPA issued a notice of proposed rulemaking, in which it
proposed to revisit the status of HCFC–141b, HCFC–22,
HCFC–124, and HCFC–142b, and to list all four as unaccept-
able in all foam applications, both as substitutes for CFCs and
for each other. 65 Fed. Reg. at 42,656. The proposed rule,
inter alia, had the effect of denying ATOFINA’s petition to
allow new users to use HCFC–22, HCFC–124 and HCFC–
6
142b as substitutes for HCFC–141b, but also swept more
broadly by effectively proposing to disallow all existing use of
the four hydrochlorofluorocarbons. EPA explained that it
was proposing to list the chemicals as unacceptable because
they had significant ozone-depleting potential and ‘‘there are
technically feasible zero-ODP [ozone-depleting-potential] sub-
stitutes available.’’ Id. at 42,657–58.
EPA received numerous comments on the proposed rule,
many of which focused on the economic impact, particularly to
small businesses, of comprehensively de-listing the four chem-
icals at issue; the bulk of these related to the economic
hardship that existing users of HCFC–22 and HCFC–142b
would face from the proposed ban. After the comment
period closed, EPA obtained additional information through
new comments, meetings with industry representatives, and a
consultant it hired to gather additional information on the
feasibility of alternatives to HCFC–141b in certain sectors.
EPA’s consultant’s report in particular expressed doubts
about the ability of existing approved alternatives to HCFC–
141b to function as viable substitutes across all specific foam
end-uses, for economic reasons, such as the cost of HFC–
245fa and the cost of equipment adjustments, and for techni-
cal reasons, such as the inability of foams manufactured with
approved alternatives, at least those that had been tested, to
meet certain insulation and space requirements. EPA then
published a notice of data availability inviting comment, not-
ing that the new information pertained to, inter alia, ‘‘alter-
natives currently used in each sector and technically viable
alternatives.’’ 66 Fed. Reg. 28,408, 28,408 (May 23, 2001).
After receiving additional comment, EPA issued a final rule
implementing its proposed rule in some respects but not
others. 67 Fed. Reg. 47,703 (July 22, 2002). First, EPA
deferred reaching a decision on whether it would permit
continued use of HCFC–141b. Id. at 47,706. Second, EPA
abandoned its proposal to limit existing use of HCFC–22 and
HCFC–142b as substitutes for CFCs, and allowed existing
users of those chemicals continued use of them, noting that
‘‘there would be a significant impact on small businesses’’ if
EPA proceeded as proposed and that switching to alterna-
7
tives ‘‘would be difficult and prohibitively costly.’’ Id. at
47,706–09. Third, EPA implemented its proposal to list
HCFC–124 as unacceptable in all foam uses, thus denying
ATOFINA’s petition in that respect. Id. at 47,708. Fourth,
as to ATOFINA’s petition to allow new use of HCFC–22 and
HCFC–142b, as substitutes for HCFC–141b, EPA established
different rules for their use based on the specific application.
Observing that it ‘‘is strongly opposed to listing HCFCs as
acceptable where non-ozone-depleting alternatives are avail-
able,’’ EPA listed HCFC–22 and HCFC–142b as unacceptable
substitutes for HCFC–141b in several end-uses (polyurethane
boardstock, spray foam, and appliances) because manufactur-
ers in those sectors had ‘‘identified and, in many cases,
implemented viable non-ozone-depleting alternatives to
HCFC–141b.’’ Id. at 47,707. For uses in commercial refrig-
eration, sandwich panel applications, polyurethane slabstock,
and other foams, however, which EPA noted were ‘‘comprised
of a wide range of diverse applications with unique technical
considerations,’’ EPA stated that for these three uses ‘‘ozone-
friendly alternatives to HCFC–141b have not yet been fully
developed and implemented across the spectrum of applica-
tions.’’ Id. Because ‘‘technical information is scarce for
these applications’’ and it is ‘‘difficult to assess, in the absence
of detailed information, the viability of alternatives in each
narrow application,’’ EPA expressed concern that some end-
users in specific applications might not be able to switch to
approved alternatives because of thermal performance, di-
mensional, and flammability control requirements. Id. at
47,713–14. In the final rule, EPA, pursuant to 40 C.F.R.
§ 82.180(b)(3), listed HCFC–22 and HCFC–142b as accept-
able substitutes for HCFC–141b within those three end-uses,
subject to narrowed use limits conditioned on the user’s
ability first to ‘‘ascertain that other acceptable alternatives
are not technically feasible.’’ Id. at 47,705. Users would be
required to ‘‘document the results of their evaluation, and
retain the results on file for the purpose of demonstrating
compliance.’’ Id. Notwithstanding its decision to allow some
substitution of HCFC–22 and HCFC–142b for HCFC–141b,
EPA advised that it was ‘‘continuing to review’’ the end-uses
8
in question ‘‘to determine the progress of non-ozone-depleting
alternatives,’’ and that ‘‘[a]s non-ozone-depleting alternatives
become more widely available, the agency will reevaluate the
acceptability of HCFCs in these end-uses.’’ Id. at 47,707.
The rule also advised end-users to begin using non-ozone-
depleting substitutes as they became available ‘‘in anticipation
of future EPA action restricting the use of HCFCs.’’ Id.
Anticipating based on its own market analysis that it will
lose sales volume for HFC–245fa if some users are permitted
to substitute HCFC–22 and HCFC–142b for HCFC–141b,
Honeywell filed this petition for review. See CAA § 307, 42
U.S.C. § 7607. Honeywell, which also manufactures HCFC–
22 and sells stockpiles of HCFC–141b and HCFC–142b, does
not challenge EPA’s decisions to defer a decision regarding
the permissibility of HCFC–141b use, to allow continued use
of HCFC–22 and HCFC–142b as CFC substitutes, and to bar
use of HCFC–124. Rather, Honeywell’s petition is limited to
EPA’s fourth decision, to permit some new use of HCFC–22
and HCFC–142b, as substitutes for HCFC–141b.
II.
As a threshold matter, we address EPA’s contention that
Honeywell lacks standing under Article III of the Constitu-
tion as well as prudential standing to challenge the final rule.
EPA sees this lawsuit as ‘‘nothing more than a futile effort to
bolster the demands for [Honeywell’s] product, HFC–245fa,
in a market that cannot use the product because of technical
constraints.’’ Resp. Br. at 3. For Article III standing,
Honeywell points to its ‘‘substantial economic injury — lost
sales of HCFC 245fa.’’ Pet. Br. at 13. For prudential
standing, Honeywell points to ‘‘its role in the market for
substitutes to ozone-depleting substance that Congress creat-
ed in Section 612 of the CAA.’’ Id. at 14. Essentially, we
agree that Honeywell has standing to challenge the final rule
for these reasons.
9
A.
A party wishing to challenge agency action must meet the
familiar Article III requirements of injury in fact, traceability,
and redressability. See Lujan v. Defenders of Wildlife, 504
U.S. 555, 560–61 (1992); Ethyl Corp. v. EPA, 306 F.3d 1144,
1147 (D.C. Cir. 2002). The final rule authorizes the use of
HCFC–22 and HCFC–142b as substitutes for HCFC–141b
only pursuant to narrowed use limits, conditioned upon the
user’s ability first to ascertain and document that non-ozone-
depleting alternatives, such as HFC–245fa, are not technically
feasible for the specific application of HCFC–22 and HCFC–
142b. EPA contends, therefore, that Honeywell suffers no
‘‘injury in fact’’ from having those chemicals listed as accept-
able because the rule permits their use only by parties who
are not potential purchasers of Honeywell’s product.
While the narrowed use limits may very well cause Honey-
well’s injury to be smaller than it would have been if the EPA
had approved ATOFINA’s petition outright, they defeat
standing only if the court can conclude that there are no
additional foam manufacturers that would purchase HFC–
245fa if HCFC–22 and HCFC–142b were unavailable. This
assumption is not justified on the rulemaking record. The
final rule, 40 C.F.R. Pt. 82, Subpt. G, App. K (table) (2004),
requires only documentation that alternative chemicals would
not satisfy existing ‘‘performance or safety requirements,’’ not
documentation that it would be impossible to manufacture
foam at all. Presumably some manufacturers would be
forced, in the absence of other alternatives, to relax their
performance standards and use HCFC–245fa. Honeywell
has submitted an affidavit from the Vice President and Gen-
eral Manager of its Chemicals Operating Unit, Richard V.
Preziotti, stating that Honeywell performed a market analysis
in 1999 estimating domestic demand for HFC–245fa of ap-
proximately 20 million pounds over the period 2003–2010 for
use in commercial refrigeration and sandwich panel applica-
tions, rigid polyurethane slabstock, and ‘‘other foams’’ catego-
ries, assuming users of HCFC–141b would not be permitted
10
to use other HCFCs after December 31, 2002 when produc-
tion of HCFC–141b was phased out. According to the affida-
vit, projected losses from the final rule are approximately 2–3
million pounds per year until the phase out of HCFC–22 and
HCFC–142b in 2010, for a total loss of approximately 16–24
million pounds. EPA has submitted nothing other than its
own speculation to counter this evidence. Cf. Sierra Club v.
EPA, 292 F.3d 895, 899–901 (D.C. Cir. 2002). Some subset of
manufacturers that cannot meet existing performance re-
quirements without HCFC–22 or HCFC–142b would presum-
ably, if those chemicals were unavailable, be forced to manu-
facture foam products that are less commercially desirable by
using available alternatives, such as Honeywell’s product, and
in the absence of any evidence to the contrary, the affidavit
suffices to establish injury in fact. See id. at 400–01.
Similarly unpersuasive, for the same reason, is EPA’s
speculation that Honeywell might suffer no injury from the
rule even if it could lead to the use of HCFC–22 or HCFC–
142b by customers who might otherwise purchase HFC–
245fa, either because customers might all choose different
approved alternatives, because customers permitted to use
HCFC–22 and HCFC–142 might nonetheless opt to purchase
HFC–245fa, or because Honeywell might sell enough addi-
tional HCFC–22 and HCFC–142b, both of which it also
manufactures, to compensate for any lost HFC–245fa sales.
The Preziotti affidavit speaks directly to this question, stating
that Honeywell’s projected revenues from increased sales of
HCFC–122 and HCFC–142b, neither of which is proprietary,
would not offset HFC–245fa revenues lost as a result of the
rule. EPA offers no evidence to the contrary. While EPA
points to Honeywell’s comments during the rulemaking that
HFC–245fa is less expensive than HCFC–142b or HCFC–22,
those figures refer to overall system cost, not the cost of
HFC–245fa to foam manufacturers; EPA’s consultant’s re-
port indicates the cost of HFC–245fa is meaningfully higher
than the cost of competing chemicals.
11
Honeywell satisfies the traceability requirement because
the rule legalizes the entry of a product into a market in
which Honeywell competes — the market for approved sub-
stitutes for HCFC–141b. EPA maintains that Honeywell
cannot demonstrate that it would benefit from a decision
listing HCFC–22 and HCFC–142b as unacceptable because
doing so would require speculation about the purchasing
decisions of third parties not before the court. There is not
much to this chain-of-speculation objection; it is well estab-
lished that ‘‘[p]arties suffer cognizable injury under Article
III when an agency ‘lift[s] regulatory restrictions on their
competitors or otherwise allow[s] increased competition.’ ’’
Wabash Valley Power Ass’n, Inc. v. FERC, 268 F.3d 1105,
1113 (D.C. Cir. 2001) (quoting Associated Gas Distribs. v.
FERC, 899 F.2d 1250, 1259 (D.C. Cir. 1990)); see also Bris-
tol–Myers Squibb Co. v. Shalala, 91 F.3d 1493, 1499 (D.C.
Cir. 1996). As a favorable opinion of the court could remove
the competing chemicals from the market, redressability is
satisfied as well; as discussed, removal of these competing
products, even if customers using them might have to relax
some performance standards to use HFC–245fa, still stands
to benefit Honeywell.
B.
In addition to the constitutional requirements of Article III,
a petitioner seeking review of agency action must also demon-
strate prudential standing to bring the suit; in other words,
that ‘‘the interest it seeks to protect ‘is arguably within the
zone of interests to be protected or regulated by the statute
TTT in question.’ ’’ Cement Kiln Recycling Coalition v. EPA,
255 F.3d 855, 870 (D.C. Cir. 2001) (per curiam) (‘‘Cement
Kiln’’) (quoting Ass’n of Data Processing Serv. Orgs. v. Camp,
397 U.S. 150, 153 (1970)). The zone of interests test ‘‘is not
meant to be especially demanding,’’ excluding only those
whose interests are ‘‘so marginally related to or inconsistent
with the purposes implicit in the statute that it cannot
reasonably be assumed that Congress intended to permit the
suit.’’ Clarke v. Sec. Indus. Ass’n., 479 U.S. 388, 399 (1987).
Our cases have pointed out that a party need not share
12
Congress’ motives in enacting a statute to be a suitable
challenger to enforce it; ‘‘parties motivated by commercial
interests routinely satisfy the zone of interests test,’’ as
‘‘[c]ongruence of interests, rather than identity of interests, is
the benchmark.’’ Amgen, Inc. v. Smith, 357 F.3d 103, 108–09
(D.C. Cir. 2004). If there is reason to believe that a party’s
interest in statutory enforcement will advance, rather than
hinder, the operation of a statute, the court can reasonably
assume that Congress intended to permit the suit.
EPA protests that Honeywell’s interest in enforcing CAA
§ 612 ‘‘is nothing more than a concern [about] EPA’s alleged
regulatory laxity,’’ Resp. Br. at 20, and relies on cases holding
that commercial interests lack prudential standing to enforce
regulatory burdens against competitors, for when those inter-
ests and those of the statute are not aligned, such suits
‘‘[c]arr[y] a considerable potential for judicial intervention
that would distort the regulatory process.’’ Hazardous
Waste Treatment Council, Inc. v. EPA, 861 F.2d 277, 282–86
(D.C. Cir. 1988) (per curiam) (‘‘HWTC II’’); see also Hazard-
ous Waste Treatment Council v. EPA, 885 F.2d 918, 924–26
(D.C. Cir. 1989) (‘‘HWTC IV’’); Cement Kiln, 255 F.3d at
870–71. In HWTC II & IV and Cement Kiln, the court held
that manufacturers of pollution control equipment lacked
prudential standing to challenge allegedly too-weak pollution
regulations, where stronger regulations would lead to in-
creased demand for their products, because of insufficient
alignment between the manufacturers’ commercial interests
and the environmental purposes of the statute. EPA’s reli-
ance on these cases is misplaced, and EPA overreads them,
for prudential standing depends on the nature of the statuto-
ry scheme and the competitor interests. Honeywell is suing
to enforce a restriction, CAA § 612(c), that is hardly vulnera-
ble to the sort of manipulation that concerned the court in the
cases on which EPA relies. A substitute product is either
permitted to compete in the market for approved substitutes
or it is not. Irrespective of whether the statutory scheme
contemplates that competitive interests will advance statutory
goals, the court has held that the Hazardous Waste Treat-
ment Council line of cases is inapposite when a competitor
13
sues to enforce a ‘‘statutory demarcation,’’ such as an entry
restriction, because ‘‘the potentially limitless incentives of
competitors [are] channeled by the terms of the statute into
suits of a limited nature brought to enforce the statutory
demarcation.’’ Scheduled Airline Traffic Offices v. Dep’t of
Defense, 87 F.3d 1356, 1360–61 (D.C. Cir. 1996) (quoting First
Nat’l Bank and Trust Co. v. Nat’l Credit Union Admin., 988
F.2d 1272, 1278 (D.C. Cir. 1993), aff’d 522 U.S. 479 (1998)). A
suit by a competitor to enforce § 612(c) involves such a
demarcation; ‘‘entry-like restrictions’’ are less subject to ma-
nipulation than the open-ended emissions standards in HWTC
II & IV and Cement Kiln because they ‘‘constrain[ ] competi-
tors to a limited role in guarding a congressionally drawn
boundary.’’ First Nat’l Bank and Trust Co., 988 F.2d at
1278. Therefore, the limits of CAA § 612, which restricts
challenges to a determination of whether EPA properly de-
cided which substances should be allowed to compete in the
market for approved substitutes, sufficiently align Honey-
well’s competitive interests with those of the statute to make
it a suitable challenger to enforce CAA 612’s terms.
PART II
SENTELLE, Circuit Judge, writing in Part II the opinion of
the court: Honeywell brings this petition for review arguing
that EPA exceeded its statutory authority under Clean Air
Act (‘‘CAA’’) section 612(c) by approving HCFC–22 and
HCFC–142b as acceptable substitutes for HCFC–141b in
certain limited end uses, and therefore allowing those two
chemicals to compete with Honeywell’s approved substitute,
HFC–245fa. The argument is that EPA premised its approv-
al on the economic impact of denying ATOFINA’s petition
(which would have limited the market for substitutes to
HFC–245fa). Because section 612(c), Honeywell claims, does
not permit EPA to consider economic factors in the approval
process, this approval exceeded EPA’s statutory authority
under the CAA.
We agree that EPA’s rule considered economic factors and
grant Honeywell’s petition for review. We also hold that the
14
only permissible remedy under the CAA is to vacate the rule.
We therefore vacate the rule to the extent it approves ATO-
FINA’s application to list new uses of HCFC–22 and HCFC–
142b as acceptable substitutes for HCFC–141b in certain
limited end uses.
I.
HCFC–141b is a blowing agent used to manufacture cer-
tain types of foam, primarily foam insulation. The rule under
review listed new uses of HCFC–22 and HCFC–142b as
acceptable substitutes for HCFC–141b in some foam end uses
and unacceptable in others. EPA found that those two
chemicals were acceptable substitutes for HCFC–141b in
foam insulation used in commercial refrigeration, sandwich-
panel insulation, polyurethane slabstock, and other foams,
assuming users intending to use the substitutes ascertain and
document that other acceptable alternatives are not ‘‘techni-
cally feasible.’’ Protection of Stratospheric Ozone, 67 Fed.
Reg. 47,703, 47,711 (July 22, 2002).
EPA justified this conclusion by noting that use of these
two substitutes in these end uses was widespread (because
they are similar in cost to HCFC–141b), and that there were
diverse commercial applications for such foams, each of which
had unique ‘‘technical considerations.’’ Id. at 47,713. Those
diverse specifications, EPA reasoned, might make it difficult
for businesses to switch to other, non-ozone-depleting blowing
agents. For example, in foam used to insulate refrigerated
truck bodies and insulated rail cars, ‘‘it is critical to maintain
thermal performance, flammability control, and an absolute
outside dimension of a container while maximizing internal
dimensions,’’ and non-ozone-depleting chemicals might not be
sufficient to meet these requirements. Id. Also, because
businesses use all three kinds of chemicals, and because of
the diverse commercial applications for these foams, EPA
believed it had insufficient information to assess the ‘‘viabili-
ty’’ of alternatives in each application. Id. at 47,714. In
some ‘‘niche applications TTT foam manufacturers may experi-
ence difficulties and delays in transitioning to TTT alterna-
tives. Given the constraints associated with cost and timing
15
of transitioning to alternatives for small businesses, and the
need to facilitate a smooth and equitable transition,’’ id., EPA
believed that the limited use of these substitutes was appro-
priate if applicants made the required showing of technical
infeasibility.
II.
The first issue we must decide is whether this justification
for approving new uses of HCFC–22 and HCFC–142b as
acceptable substitutes for HCFC–141b relied on economic
factors.1 EPA’s defense to Honeywell’s challenge is not that
CAA section 612(c) allows it to consider economic costs in
deciding whether a given substitute is acceptable or unaccept-
able. Rather, EPA’s defense is that the rule under review
did not actually consider costs, and instead relied on ‘‘techni-
cal constraints.’’
The flaw in EPA’s position is the assumption that technical
constraints exclude considerations of economics. In truth,
economic feasibility is part of technical feasibility. It is often
possible to fit a round peg in a square hole if enough money is
spent to make the round peg fit. In other words, a given
change in manufacturing technique may be ‘‘technically in-
feasible’’ only as compared to some baseline of what it would
cost to change the technique.
The rule confirms that the technical considerations consid-
ered by the agency intersect with economic considerations.
For example, the need for refrigerated truck bodies and
insulated rail cars to ‘‘maximiz[e] internal dimensions,’’ id. at
47,713, arises because trucking companies want to transport
as much food as possible per truckload to maximize their
revenues. Similarly, EPA suggested that the ‘‘technical con-
straints,’’ associated with switching to non-ozone-depleting
chemicals were company-specific, in part because the econom-
ic need for businesses to ‘‘remain cost competitive’’ caused
1 As this statement of the issue makes clear, we in fact disagree
with the dissent that this merits question ‘‘depends TTT on what it
means for ‘technical constraints’ to ‘preclude’ the use of other
available substitutes.’’ Dissent at 1.
16
widespread use of HCFC–22 and HCFC–142b. Id. The
implication is that economic factors caused those companies
to be ‘‘locked in’’ to using these particular chemicals in the
manufacturing process, despite the fact that within those end
uses, ‘‘non-ozone depleting alternatives have been identified
and, in limited cases, implemented successfully.’’ Id. In
other words, even though it is technically possible to use
manufacturing techniques that do not deplete the ozone layer,
it would cost too much to require companies to transition to
such techniques given those that, for cost reasons, they have
already implemented. This, too, is therefore an economic
justification for continuing to allow these companies to use
HCFC–22 and HCFC–142b. Finally, EPA noted that the
wide variety of products these types of foam are used to
manufacture meant that small businesses might economically
suffer from a regulatory requirement to use non-ozone-
depleting alternatives. EPA noted, specifically, that it was
necessary to ‘‘level the playing field for small businesses,’’ and
that those businesses might face ‘‘constraints associated with
cost and timing of transitioning to alternatives,’’ a justification
that clearly considers costs. Id. at 47,714. Even if the
agency is correct to characterize such concerns as ‘‘perform-
ance’’ or ‘‘technical’’ factors, the fact remains that they are
also economic factors.
EPA’s reliance on economic constraints requires reversal of
its rule. As stated, EPA does not justify the rule on the
ground that CAA section 612(c) allows it to consider economic
factors in approving a given substitute as acceptable or
unacceptable. Nevertheless, EPA’s counsel at oral argument
said that EPA’s position is that it may consider costs, and it is
at least facially plausible to read the term ‘‘available’’ in
section 612(c) to permit consideration of ‘‘economic or prac-
ticality’’ concerns. Such a justification cannot pass muster in
this Court, however, as the agency did not offer that con-
struction of the statute below. Under Chevron, U.S.A., Inc.
v. Natural Resources Defense Council, Inc., 467 U.S. 837
(1984), whether the CAA section 612(c), a statute EPA is
charged to administer, permits EPA to consider costs is a
matter on which we defer to the agency’s expert judgment,
17
unless its interpretation is unreasonable or if the plain terms
of the statute say otherwise. Id. at 843–44. In such matters,
in which the agency’s rule ‘‘is valid only as a determination of
policy or judgment which the agency alone is authorized to
make and which it has not made, a judicial judgment cannot
be made to do service for an administrative judgment.’’ SEC
v. Chenery Corp., 318 U.S. 80, 88 (1943). Whether the
agency’s construction of the statute is reasonable under Chev-
ron step two is one such issue, given that the issue requires
agency expertise. See Kansas City v. HUD, 923 F.2d 188,
192 (D.C. Cir. 1991). Therefore, even assuming, without
deciding, that the text of section 612(c) permits EPA to
interpret the statute to consider costs, we must still reverse
EPA’s decision and remand to the agency. Without knowing
the agency’s interpretation of the statute, we simply have no
way of evaluating whether its interpretation is reasonable.
True, we do not defer to the EPA on whether section 612(c)
clearly requires it to consider costs, but EPA has not ad-
vanced that argument before us. Because that argument has
not been briefed and is therefore not properly before us, we
express no opinion on its merits.
For these reasons, we grant the petition for review.
III.
The second issue we must decide is the proper remedy to
correct the agency’s error. We hold that remedy is to vacate
the rule to the extent it approves ATOFINA’s application to
list new uses of HCFC–22 and HCFC–142b as acceptable
substitutes for HCFC–141b in certain limited end uses.
We read the judicial review provisions of the CAA to
authorize us only to vacate, rather than remand, for the sort
of challenge at issue here. Honeywell’s challenge is a sub-
stantive challenge to the agency’s statutory authority to
promulgate the rule. Such challenges are governed by CAA
section 307(d)(9), rather than the Administrative Procedure
Act. See 42 U.S.C. § 7607(d)(1) (‘‘[t]he provisions of section
553 through 557 and section 706 of Title 5 shall not, except as
18
expressly provided in this subsection, apply to actions to
which this subsection applies’’).
Section 307(d)(9) provides that ‘‘the court may reverse any
TTT action found to be TTT in excess of statutory jurisdiction,
authority, or limitations, or short of statutory right.’’ 42
U.S.C. § 7607(d)(9)(C) (emphasis added). Here, the term
‘‘reverse’’ is being used as a term of art to refer to the action
of a reviewing court that finds error in a decision under
review. In that context, the ordinary meaning of the term
‘‘reverse,’’ at the time section 307(d) was enacted as part of
the CAA Amendments of 1977, 91 Stat. 685, 775, was ‘‘to
overthrow, set aside, or make void (a legal decision) by a
contrary decision.’’ Webster’s New Collegiate Dictionary 991
(1973); see also Webster’s Third New International Dictio-
nary 1943 (1981) (‘‘to overthrow [a legal decision] by a con-
trary decision: make void [as for error] ¢the higher court
may [reverse] the judgment$’’). ‘‘Overthrow[ing], set[ting]
aside, or mak[ing] void’’ is language suggesting vacatur.
Because this Court’s only source of authority to order a
remedy for EPA’s unlawful action is section 307(d)(9), our
power is limited to ‘‘reversing,’’ and hence vacating, the
offending portions of EPA’s rule below.
We do realize that there is circuit ‘‘precedent for the
authority of the court to remand without vacating.’’ Milk
Train, Inc. v. Veneman, 310 F.3d 747, 758 (D.C. Cir. 2002)
(Sentelle, J., dissenting); see also id. at 755–56 (majority
opinion) (citing cases). To our knowledge, however, our only
case under the CAA holding that remand, rather than vaca-
tur, is the proper remedy is Davis County Solid Waste
Management v. EPA, 108 F.3d 1454 (D.C. Cir. 1997) (per
curiam), which we do not think governs our holding here. In
Davis, this Court held that EPA exceeded its statutory
authority under the CAA, yet remanded without vacating the
rule. Id. at 1459. However, in Davis we did not analyze the
actual language of section 307(d)(9), and it does not appear
that the parties brought that language to the court’s atten-
tion. That decision is therefore not binding on this Court.
For ‘‘[t]he Supreme Court held long ago that ‘[q]uestions
which merely lurk in the record, neither brought to the
19
attention of the court nor ruled upon, are not to be considered
as having been so decided as to constitute precedents.’ ’’
Checkosky v. SEC, 23 F.3d 452, 492 (D.C. Cir. 1994) (per
curiam) (separate opinion of Randolph, J.) (quoting Webster v.
Fall, 266 U.S. 507, 511 (1925)); see also In re Cheney, 334
F.3d 1096, 1118 n.8 (D.C. Cir. 2003) (Randolph, J., dissenting),
vacated on other grounds by Cheney v. U.S. Dist. Court for
the Dist. of Columbia, No. 03–475, slip op. at 16 (June 24,
2004). We do not read court cases like we read statutes;
unlike statutes, cases derive their binding force from the
necessity to avoid revisiting arguments and issues litigated
before and decided by those courts, not from the deductive
implications of their holdings. The currency of courts is
principle, not commands, and we violate no principle laid
down by Davis by analyzing the actual words of the statute
setting forth the extent of this Court’s remedial power over
the EPA’s CAA rules. In light of Davis’s silence on the
interpretation of the term ‘‘reverse’’ in section 307(d)(9),
Davis is not binding on that question.
In sum, vacatur, rather than remand, is the only remedy
we are authorized to impose to correct the error in the rule
under review.
IV.
For the reasons expressed above, we vacate the rule with
respect to those end uses in which EPA permitted limited
new use of HCFC–22 and HCFC–142b as acceptable substi-
tutes for HCFC–141b and remand to the EPA for proceed-
ings not inconsistent with this opinion.
1
RANDOLPH, Circuit Judge, concurring, with whom SENTELLE,
Circuit Judge, joins: I join the per curiam opinion and Judge
Sentelle’s opinion in part II. I write separately to explain
why I believe vacating (or reversing) and remanding unlawful
agency action, rather than simply remanding, should always
be the preferred course.
It is easy to forget that when we vacate and remand, as we
are doing here, there will be a safety valve. The agency, and
any intervenors on its side, will have the opportunity to file
post-decision motions demonstrating why the unlawful order
or rule should remain in place during proceedings on remand.
See, e.g., U.S. Tel. Ass’n v. FCC, 188 F.3d 521, 531 (D.C. Cir.
1999). Vacating an order or rule and then entertaining such
stay motions has several important advantages over remand-
ing without vacating. First, it preserves the adversary pro-
cess. When we simply order a remand at the end of our
merits opinion we are invariably making a remedial decision
without the benefit of briefing or argument. It is quite rare
for the parties even to mention the question of remedy in
their merits briefs. In post-decision motions on stay applica-
tions, that will be the question they address. The court thus
will have the benefit of hearing from both sides. Second, in
deciding whether to allow unlawful agency action to remain in
place during the remand (by way of a stay), the court will act
with its eyes open and will have the information needed to
assess the consequences of granting or denying a stay.
Third, the existence of a stay with time limits, rather than an
open-ended remand without vacatur, will give the agency an
incentive to act promptly; when we simply remand, the
agency has no such incentive. Fourth, there is a long-
standing body of law in this circuit establishing the factors
that determine whether a stay should be granted. See,
e.g.,Virginia Petroleum Jobbers v. FPC, 259 F.2d 921, 925
(D.C. Cir. 1958); WMATA v. Holiday Tours, Inc., 559 F.2d
841, 843 (D.C. Cir. 1977); Wisconsin Gas Co. v. FERC, 758
F.2d 669, 673–74 (D.C. Cir. 1985) (per curiam). These include
the likelihood that the agency’s position will prevail on re-
mand; the likelihood that there will be irreparable harm
without the stay; the prospect that others will be harmed if
the court grants the stay; and the public interest in granting
the stay. Id. Remanding without vacating is in effect grant-
2
ing an indefinite stay of the effectiveness of the court’s
decision. Yet we have issued many remand-only orders
without mentioning or analyzing any of the considerations
that should guide our remedial judgment. See, e.g., Western
Resources, Inc. v. FERC, 9 F.3d 1568, 1581 (D.C. Cir. 1993);
Laclede Gas Co. v. FERC, 997 F.2d 936, 948 (D.C. Cir. 1993);
City of Mesa v. FERC, 993 F.2d 888, 898 (D.C. Cir. 1993).
Even when we have offered some reasons for remanding
without vacating, the reasons given are different from the
factors set forth in Virginia Petroleum Jobbers, which I
believe should be controlling. See, e.g., Sugar Cane Growers
Coop. of Fla. v. Veneman, 289 F.3d 89, 98 (D.C. Cir. 2002). I
would therefore vacate and remand regardless whether a
judicial review provision gave us discretion merely to remand
and leave the illegal rule in place.
1
ROGERS, Circuit Judge, concurring in part and dissenting in
part: I concur in holding that EPA impermissibly considered
costs in the rule on review. See Op. Part II. I write
separately in Part I on the nature of the error, because I
cannot join the court’s reasoning, and in Part II on the
appropriate remedy, because the court has ignored binding
precedent. Thereafter, in light of the required remand, I
address in Part III Honeywell’s contention that EPA’s past
approval of other substitute chemicals as safe alternatives
preclude it from making any exceptions authorizing use of
HCFC–22 or HCFC–142b for some foam end users.
I.
The challenged regulation permits new use of HCFC–22
and HCFC–142b only when ‘‘necessary to meet performance
or safety requirements,’’ and ‘‘technical constraints [ ] pre-
clude the use of other available substitutes.’’ 40 C.F.R. Pt. 82
Subpt. G, app. K (2004). Whether EPA impermissibly took
costs into consideration depends on what it means for ‘‘techni-
cal constraints’’ to ‘‘preclude’’ the use of other available
substitutes. While there is language in the rule indicating
that EPA considered costs, the more natural reading of the
regulation, in light of the language EPA used, is, as EPA
counsel maintains, that the regulation means what it says it
means: an end-user may only use HCFC–22 or HCFC–142b
if it is not actually possible to use anything else. The fact
that it might be more expensive to use an approved alterna-
tive would not suffice — use of the hydrochlorofluorocarbon
must be ‘‘necessary.’’
This reading of the regulation is certainly natural, as it
gives the term ‘‘preclude’’ its most obvious meaning of ‘‘to
make impossible.’’ AMERICAN HERITAGE DICTIONARY OF THE
ENGLISH LANGUAGE 212 (4th ed. 2000). Indeed, absent EPA’s
reference in the final rule to costs, the court would likely read
the regulation as EPA’s counsel suggests, giving the word
‘‘preclude’’ its most natural, dictionary meaning. Cf. Citizens
Against Burlington, Inc. v. Busey, 938 F.2d 190, 202–02 (D.C.
Cir. 1991). If technical constraints must ‘‘make impossible’’
the use of an approved substitute before use of a hydrochloro-
fluorocarbon is permitted, then the court’s concern about
2
EPA permitting HCFC–22 or HCFC–142b use on the basis of
mere convenience or cost, see Op. at 15–16, would be inappo-
site: modifications might be required to shift to an approved
substitute that ‘‘make difficult’’ or ‘‘make costly’’ or ‘‘make
inconvenient’’ the use of an approved substitute, but they
would not ‘‘preclude’’ it. Notably, the record before the court
indicates that the transition from HCFC–141b to HCFC–22
or HCFC–142b is more likely to involve equipment modifica-
tions than the transition from HCFC–141b to an approved
alternative. HFC–245fa, Honeywell’s product, is a liquid
agent like HCFC–141b, and was developed specifically as a
‘‘drop-in’’ substitute for use in the same equipment. HCFC–
22 and HCFC–142b, on the other hand, are both gaseous
agents, which, EPA acknowledged, would often require modi-
fications to equipment currently using liquid agents such as
HCFC–141b. See 67 Fed. Reg. 47,703, 47,713–14 (July 22,
2002). Some transition costs, then, would cut against HCFC–
22 and HCFC–142b rather than in their favor. Thus, EPA
counsel’s suggestion, that the HCFCs’ use under the new
regulation is intended for cases where foam made with an
approved substitute would not be functional, is not without
plausibility.
Under a natural reading of the language used by EPA,
HCFC–22 and HCFC–142b use would be reserved, not for
situations where it would be ‘‘possible to fit a round peg in a
square hole’’ with sufficient expense, Op. at 15, but for
situations where the physical limitations of approved foam-
blowing (or foam-pouring) agents are such that equipment or
design modifications will not be sufficient to meet ‘‘perform-
ance or safety requirements.’’ With this view of EPA’s
meaning, the fact that EPA also referred to costs in explain-
ing the regulation would be harmless error. Cf. PDK Labo-
ratories Inc. v. EPA, 362 F.3d 786, 799 (D.C. Cir. 2004); 5
U.S.C. § 706. The bulk of EPA’s explanation of the regula-
tion in the final rule is consistent with this natural reading of
the regulation. EPA relied chiefly on its concern that foam
made with existing alternatives might, in some instances, not
meet certain dimensional, flammability control, and insulation
requirements. See 67 Fed. Reg. at 47,713–14. EPA did not
conclude that approved alternatives would produce less desir-
3
able foam; rather, it expressed concern that it did not yet
have enough information to confirm whether the foam made
with existing approved substitutes to HCFC–141b would al-
ways work functionally as well as foam made with HCFC–22
or HCFC–142b.
The court appears to hold that EPA impermissibly consid-
ered costs at two stages of its decision: first, by comparing
the functionality of foam made with approved alternatives
with foam made with HCFC–22 and HCFC–142b, and second,
by considering the costs manufacturers would incur in switch-
ing to approved alternatives. See Op. at 15–16. While EPA
relied on the first consideration, it was not error to do so.
The court defines too broadly what it means for EPA to
impermissibly consider costs. Expressing concern over
whether a substitute product actually works (or works as
well) as the substance it is replacing is, of course, a decision
that may carry economic consequences, as where a less
functional foam product will be less commercially desirable.
If a foam is denser, picnic coolers will have to be heavier to
keep the same amount of food cold; if a foam is less insular, it
will require thicker walls in refrigerators or houses that use it
as insulation. But that does not convert every decision EPA
makes about whether a substitute works into a decision about
costs: were that so, every approval or disapproval decision
EPA makes under the SNAP program would be suspect, an
extreme position Honeywell does not urge.
The court’s second theory, however — that EPA based its
decision in part on the costs manufacturers would incur in
switching to approved alternatives — is indicated by the
record. See Op. at 15–16. A statement by EPA in the rule,
about protecting small businesses, calls into question the
natural reading of the regulation urged by EPA counsel:
In other cases, where HCFC–141b is used in niche
applications, EPA believes foam manufacturers may ex-
perience difficulties and delays in transitioning from
HCFC–141b to non-ozone-depleting alternatives. Given
the constraints associated with cost and timing of transi-
tioning to alternatives for small businesses, and the need
to facilitate a smooth and equitable transition from
4
HCC–141b, EPA believes TTT it is appropriate to ap-
prove use of HCFC–22 and/or HCFC–142b as substitutes
for HCFC–141b TTT provided that the users TTT ascer-
tain and document that other acceptable alternatives are
not technically feasible.
67 Fed. Reg. at 47,714 (emphasis added). It is difficult to
understand this passage unless EPA believes there is some
subset of end-users for whom it would be possible yet very
costly to switch to non-ozone-depleting alternatives, and that
the rule grants this subset some form of relief. This, in turn,
suggests that EPA construes the term ‘‘preclude’’ to mean
something less than ‘‘make impossible,’’ such as to ‘‘make
difficult’’ or ‘‘make cumbersome.’’1 If so, EPA’s approach
would appear inconsistent with its current SNAP regulations.
Section 612(c) directs the Administrator of EPA to make
the use of environmentally harmful substitutes unlawful if,
inter alia, alternatives presenting reduced harm are ‘‘current-
ly or potentially available’’; the regulations provide that a
substitute will be deemed ‘‘unacceptable’’ if ‘‘other alterna-
tives exist that reduce overall risk.’’ 40 C.F.R. § 82.180(b)(4)
(emphasis added). The court, in dicta, opines that a substi-
tute may not be ‘‘currently or potentially available’’ within the
meaning of CAA § 612(c) if using it would be too impractical,
see Op. at 16, and hence, presumably, does not ‘‘exist’’ for
1 To make the same point, the court also cites EPA’s decision to
permit existing users of HCFC–22 and HCFC–142b to continue
their use of those chemicals notwithstanding the existence of non-
ozone-depleting alternatives to HCFC–22 and HCFC–142b, in large
part because of the costs they would incur were they to use
alternatives. See Op. at 15–16. EPA quite expressly relied on
transition costs in making that decision. However, EPA’s decision to
allow continued use of HCFC–22 and HCFC–142b is not challenged
by Honeywell, which petitions for review only of EPA’s decision to
allow new uses of those chemicals, by users previously using
HCFC–141b. Given the equipment modifications required to shift
from a liquid to a gaseous foam-manufacturing agent, the fact that
EPA considered transition costs as a basis for grandfathering
existing HCFC–22 and HCFC–142b users does not reveal whether
such costs played a role in EPA’s decision to permit new uses.
5
purposes of § 82.180(b)(4). But the SNAP regulations no-
where attempt to make this link. The definition of ‘‘potential-
ly available’’ turns only on whether EPA ‘‘reasonably be-
lieves’’ a substitute ‘‘to be technically feasible,’’ id. § 82.172,
and substitutes must be designated ‘‘unacceptable’’ if cleaner
alternatives ‘‘exist.’’ Id. at § 82.180(b)(4). While the SNAP
regulations make the ‘‘cost and availability of the substitute’’
an element of acceptability, id. § 82.180(a)(7)(vii), that con-
cern is limited to whether EPA ‘‘has TTT reason to prohibit its
use,’’ id. § 82.180(b)(1), not to whether cleaner alternatives
for the substance are already ‘‘currently or potentially avail-
able.’’ Under the SNAP regulations the fact that it might be
difficult or time-consuming for some small businesses or
others to use ‘‘other alternatives’’ is irrelevant, so long as
those alternatives ‘‘exist.’’ Consideration of transition costs is
thus precluded by the SNAP regulations as currently written,
irrespective of whether it might be permitted under CAA
§ 612(c), and it is arbitrary and capricious for EPA to fail to
comply with its own regulations. See Dithiocarbamate Task
Force v. EPA, 98 F.3d 1394, 1398–1402 (D.C. Cir. 1996).
For present purposes, as the court states, see Op. at [4–5],
there is no need to decide whether EPA could, consistent
with the text and purpose of CAA § 612, adopt SNAP
regulations that incorporate, into a determination of whether
a cleaner substitute is ‘‘currently or potentially available,’’
consideration of the cost and practicality of transition. While
the court speculates that such regulations might pass muster,
it properly acknowledges that this question is not before the
court. See Op. at 17. The SNAP regulations currently
include no such provision, and EPA did not attempt, either in
the rule or in its brief, to justify relying on costs in the rule
on the basis that § 612(c) permits it to do so. It remains to
be seen whether EPA will decide to make consideration of
transition costs an element of the SNAP process.
Whether CAA § 612(c) would permit substantive consider-
ation of transition costs is not apparent on the face of the
statute and presents a serious question of statutory interpre-
tation. Heretofore, when Congress has wanted the Adminis-
trator to consider costs under the CAA it has expressly called
6
for consideration of costs or practicality. See, e.g., 42 U.S.C.
§§ 7411(a)(1), 7412(d)(2), 7479(2)(C)(3). Title VI’s policy of
phasing out ozone-depleting substances involves express con-
sideration of the practicality of transition, but at a different
point in the process: in deciding whether an accelerated
phase-out schedule is warranted, the Administrator is to
consider whether ‘‘such more stringent schedule is practica-
ble, taking into account technological achievability, safety, and
other relevant factors.’’ CAA § 606(a)(2), 42 U.S.C. § 7671e
(emphasis added). The decision that an accelerated phase-
out of HCFC–141b is practicable has already been made. See
58 Fed Reg. 65,018, 65,028 (Dec. 10, 1993). The court has
repeatedly held in cases involving other sections of the CAA
that cost plays no role in the promulgation of emissions
standards. See, e.g., American Lung Assn. v. EPA, 134 F.3d
388, 389 (D.C. Cir. 1998); NRDC v. Adm’r, EPA, 902 F.2d
962, 973 (D.C. Cir. 1990), vacated in part on other grounds,
NRDC v. EPA, 921 F.2d 326 (D.C. Cir. 1991); American
Petroleum Inst. v. Costle, 665 F.2d 1176, 1185 (D.C. Cir.
1981); Lead Indus. Assn., Inc. v. EPA, 647 F.2d 1130, 1148
(D.C. Cir. 1980). The Supreme Court’s decision in Whitman
v. American Trucking Ass’n, 531 U.S. 457, 467–70 (2001),
which rejected a reading of the term ‘‘public health’’ in the
CAA that incorporated cost considerations, further cautions
against reading economic considerations into the CAA where
they do not appear on the face of the statute. Thus, whether
CAA § 612(c) might permit consideration of practicality in
extreme cases, such, as the court hypothesizes, where it
would be so difficult to ‘‘fit a round peg in a square hole,’’ Op.
at 15, that a non-ozone-depleting alternative could no longer
be said to be ‘‘available,’’ is a question that is not yet before
the court. EPA has not attempted to locate its approach in
the statutory text, and it behooves the court, in light of the
deference that may be due, to afford EPA the opportunity to
decide whether transition costs are to be considered in evalu-
ating a clean alternative’s availability.
II.
While the court properly identifies error in the regulation
on review, it goes astray on the appropriate remedy. Under
7
the court’s precedent, the proper remedy in this case is
remand, not vacatur. The court explained in Allied-Signal v.
U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 150–51 (D.C.
Cir. 1993), that remand is preferable to vacatur when an
agency might be able to support a rule through further
explanation and the ‘‘consequences of vacating may be quite
disruptive.’’ Id. at 151. See also Sinclair v. FCC, 284 F.3d
148, 162 (D.C. Cir. 2002); Fox Television Stations, Inc. v.
FCC, 280 F.3d 1027, 1047–49 & 1052–53 (D.C. Cir. 2002).
The two Allied-Signal factors are both implicated here.
First, the identified defect in the rule that the court has
identified may be curable. As discussed, the final regulation
permits new use of HCFC–22 and HCFC–142b in certain
end-uses when ‘‘necessary to meet performance or safety
requirements,’’ and ‘‘technical constraints [ ] preclude the use
of other available substitutes.’’ 40 C.F.R. Pt. 82 Subpt. G,
app. K. EPA’s counsel suggested a permissible reading of
the regulation based on the natural meaning of its terms:
that the chemicals may only be used when it is impossible,
from a technical standpoint, to use anything else. At the
same time, EPA’s explanation that it allowed new uses be-
cause of ‘‘the constraints associated with cost and timing of
transitioning to alternatives for small businesses,’’ 67 Fed.
Reg. at 47,714, suggests a policy of protecting small busi-
nesses from the costs of a possible, yet difficult, transition,
and thereby permitting the use of HCFC–22 and HCFC–142b
even in some cases where available substitutes already ‘‘ex-
ist.’’ Cf. 40 C.F.R. § 82.180(b)(4). But if EPA intended no
more than the natural reading, it can say so on remand, in
which event any impermissible reference to costs in the final
rule was irrelevant to the regulation actually promulgated,
and thus harmless error. Cf. PDK Laboratories, 362 F.3d at
799; 5 U.S.C. § 706. Of course, it is possible that EPA may
instead decide to promulgate new SNAP regulations permit-
ting consideration of transition costs in determining the avail-
ability of alternatives, or it may promulgate a new rule in
which cost is not a guiding consideration, based on its existing
SNAP regulations. Yet because EPA might wish to retain
the rule on review, and might be able to easily cure any
8
defect, vacating the rule risks unnecessary disruption to the
regulatory scheme. Cf. Allied–Signal, 988 F.2d at 150–51;
Davis Cty. Solid Waste Mgmt. v. EPA, 108 F.3d 1454 (D.C.
Cir. 1997) (per curiam).
Second, were the court to vacate the final rule with respect
to the end-uses in which EPA has permitted limited new
HCFC–22 and HCFC–142b use, the result would likely be
that all uses of HCFC–22 and HCFC–142b within those end-
uses would become permissible, as more than 90 days have
elapsed since ATOFINA’s petition and the chemicals were
not listed as unacceptable in those end-uses prior to the
proposed rule. See 40 C.F.R. § 82.174(a). This would likely
lead to more widespread interim use of these environmentally
harmful chemicals than the much more limited use EPA
authorized in the rule on review. In the past, where vacatur
of a rule risks interim harm to the environment, the court has
allowed successfully challenged EPA rules to remain in effect
pending remand. See Davis County Solid Waste Mgmt., 280
F.3d at 1459–60. Given the possibility of confusion and
environmental harm, the same course of action is warranted
here.
Rather than engage the prudential inquiry our case law
requires to determine whether remand or vacatur is the
proper course of action, the court sua sponte holds that there
is no statutory authority for the court to remand without
vacating. See Op. at 17–19. It brushes aside our exhaustive
caselaw on this question, much of it quite recent, see, e.g.,
Milk Train, Inc. v. Veneman, 310 F.3d 747, 755–56 (D.C. Cir.
2002); Fox Television Stations, 280 F.3d at 1047–49 & 1052–
53; County of Los Angeles v. Shalala, 192 F.3d 1005, 1023
(D.C. Cir. 1999); Radio–Television News Dirs. Ass’n v. FCC,
184 F.3d 872, 887–89 (D.C. Cir. 1999); Allied–Signal, 988
F.2d at 150–51, by claiming that these cases do not actually
constitute precedent and are, in any event, distinguishable.
See Op. at 18–19. Neither argument is persuasive.
The court rewrites the law of precedent, allowing a later
court to avoid binding decisions it prefers not to follow if the
earlier decisions did not fully state their reasoning. See Op.
9
at 18–19. But it is long established that irrespective of
whether a later court may conclude that its view is the better
view, it is bound, absent en banc review, by the court’s prior
decisions. See LaShawn A. v. Barry, 87 F.3d 1389, 1395
(D.C. Cir. 1996) (en banc); 28 U.S.C. § 46(c) (2004). It is
true that questions that ‘‘lurk in the record; neither brought
to the attention of the court nor ruled upon’’ do not constitute
precedent. Webster v. Fall, 266 U.S. 507, 511 (1925). But
the question the court revives today–-the court’s statutory
authority to remand agency action without vacating — has
been ‘‘brought to the attention of the court’’ on at least two
occasions by separate opinions, and on both occasions, the
court remanded the agency action in question without vacat-
ing, over separate opinions raising substantially the same
arguments as those that make up the holding of the court
today. See Milk Train, 310 F.3d at 757–58 (Sentelle, J.,
dissenting); Checkosky v. SEC, 23 F.3d 452, 491 (D.C. Cir.
1994) (per curiam) (separate opinion of Randolph, J.).
Nor can the court reasonably distinguish our precedent by
pointing out that most of it arose under the Administrative
Procedure Act (‘‘APA’’) rather than the CAA, and that the
CAA only grants the court the power to ‘‘reverse’’ administra-
tive actions. 42 U.S.C. § 7607(d)(9)(C) (2004). The court
does not explain how the relevant language in the CAA is any
different from § 706 of the APA, which confers the power to
‘‘set aside’’ agency action, 5 U.S.C. § 706(2), where the court’s
opinion itself argues that ‘‘set aside’’ is a synonym for ‘‘re-
verse.’’ Op. at 18 (quoting WEBSTER’S NEW COLLEGIATE DICTIO-
NARY 991 (1973)). And the court’s attempt to distinguish
Davis, where the court, applying the Allied–Signal test,
remanded a rule under the CAA without vacating, 108 F.3d at
1459–60, by stating that the parties in Davis did not raise the
question of the court’s authority to remand, Op. at 18, ignores
that the parties did not raise the issue in the instant case
either. Judge Randolph’s approach, see Concurring Op. at 1–
2, may be of interest to the en banc court, but, absent en banc
review, our precedent requires that the rule be remanded to
EPA for further explanation.
10
III.
Finally, in light of the required remand, I address Honey-
well’s contention that it is entitled to greater relief than the
court grants. As discussed, EPA’s decision to approve some
limited use of HCFC–22 and HCFC–142b was based in large
part on its concern that it lacked sufficient information on
whether existing ‘‘safe alternatives’’ for HCFC–141b could
always function adequately as substitutes. Honeywell con-
tends that this inquiry was foreclosed by EPA’s past approval
of safe alternatives to HCFC–141b and past refusal to ap-
prove ozone-depleting substances as safe alternatives, and
that EPA was thus precluded from approving any ozone-
depleting substances as substitutes for HCFC–141b, in any
end-uses. However, irrespective of whether CAA § 612(c)
would permit EPA to approve some limited use of HCFC–22
and HCFC–142b on remand, neither of these other objections
present separate obstacles to such approval.
Under CAA § 612(c), the Administrator is required to
‘‘publish a list of TTT safe alternatives identified under this
subsection,’’ and to promulgate regulations making it unlawful
to use any substitute ‘‘which the Administrator determines
may present adverse effects to human health or the environ-
ment, where the Administrator has identified an alternative
to such replacement that — (1) reduces the overall risk to
human health and the environment; and (2) is currently or
potentially available.’’ Id. Honeywell maintains that EPA
violated this provision because it found that suitable alterna-
tives to HCFC–141b were not ‘‘potentially available’’ even
though it had already designated several such substitutes as
‘‘safe alternatives.’’ HCFC–22 and HCFC–142b are chemi-
cals that EPA has determined to ‘‘present adverse effects to
TTT the environment’’; the importation and manufacture of
both was banned, effective 2010, in the same rule in which
EPA imposed the 2003 ban on the importation and manufac-
ture of HCFC–141b. See 58 Fed. Reg. at 65,028. EPA
therefore cannot permissibly approve their use as substitutes
if the Administrator has ‘‘identified an alternative’’ that ‘‘(1)
reduces the overall risk to human health and the environ-
11
ment; and (2) is currently or potentially available.’’ CAA
§ 612(c).
In Honeywell’s view, EPA’s approval in 1999 of HFC–245fa
in ‘‘all foam end-uses,’’ 64 Fed. Reg. 68,039, 68,041 (Dec. 6,
1999), as well EPA’s approval of other non-ozone-depleting
substitutes, see 67 Fed. Reg. at 47,711, Table B, encompassed
a determination that it is ‘‘technically feasible’’ to use HFC–
245fa in all foam end-uses, and that it is therefore ‘‘currently
or potentially available.’’ This contention conflates two terms
in § 612(c): an ‘‘alternative TTT that is potentially available’’
and a ‘‘safe alternative[ ] identified under this subsection for
specific uses.’’ Being a ‘‘safe alternative’’ and being ‘‘current-
ly or potentially available,’’ under EPA’s regulations, are not
the same thing. The SNAP regulations governing approval
of substitutes call only for applicants to identify ‘‘applications
within each sector end-use in which the substitutes are likely
to be used,’’ 40 C.F.R. § 82.178(a)(3), and provide that EPA
will approve a substitute where it has ‘‘found no reason to
prohibit its use,’’ id. § 82.180(b)(1), with the decision based on
‘‘[a]tmospheric effects,’’ ‘‘[g]eneral population risks,’’ ‘‘[e]co-
system risks,’’ ‘‘[o]ccupational risks,’’ ‘‘[c]onsumer risks,’’
‘‘[f]lammability,’’ and ‘‘[c]ost and availability.’’ Id.
§ 82.180(a)(7). On the other hand, ‘‘potentially available’’ is
defined as ‘‘any alternative for which adequate health, safety,
and environmental data, as required for the SNAP notifica-
tion process, exist to make a determination of acceptability,
and which the Agency reasonably believes to be technically
feasible, even if not all testing has yet been completed and
the alternative is not yet produced or sold.’’ Id. § 82.172. In
other words, being ‘‘potentially available’’ adds the additional
element of EPA’s reasonable belief in technical feasibility that
is not required of substances designated as safe alternatives.
A substance can be a ‘‘safe alternative’’ for a particular end-
use and yet be ‘‘potentially available’’ for only some, not all,
applications within that end-use. EPA was therefore free to
decide in this rulemaking proceeding whether specific applica-
tions remained in which permissible constraints still prevent-
ed the use of existing, non-ozone depleting substitutes such as
HFC–245fa, thus rendering them not ‘‘potentially available’’
12
for those uses. In light of the remand, it is unnecessary to
decide whether EPA had adequate record support for its
conclusion that such constraints still existed, but EPA’s past
approval decisions did not prevent it from evaluating the
feasibility of existing alternatives.
Honeywell’s related contention that EPA impermissibly
deviated from its stated policy of never approving one ozone-
depleting substance as a substitute for another fails for
essentially the same reason. In prior rules where EPA had
expressed this position, such as in its 1999 refusal to list
NARM–22, a blend containing HCFC–22, EPA had always
qualified it by noting that ‘‘[o]ther alternatives TTT are al-
ready acceptable that do not contain any ozone-depleting
refrigerants.’’ 64 Fed. Reg. 22,982, 22,984 (Apr. 28, 1999).
Similarly, in 1993, EPA stated that it ‘‘views HCFCs as
important interim substitutes that will allow for the earliest
possible phaseout of CFCs and other Class I substances’’ and
‘‘believes that the use of HCFCs should be limited to only
those applications where other environmentally acceptable
alternatives do not exist.’’ 58 Fed. Reg. at 65,026. The
informal expressions of EPA policy at recent trade shows, to
which Honeywell refers, similarly contain the qualification
that EPA is ‘‘unlikely’’ to approve any HCFCs as substitutes
for HCFC–141b because, among other things, there are ‘‘non-
ozone depleters available.’’ All these amount to are a series
of situations where EPA found non-ozone-depleting ‘‘safe
alternatives’’ to be ‘‘available;’’ in this particular instance
EPA determined that the existing ‘‘safe alternatives’’ were
not ‘‘available’’ because some specific niche applications re-
mained in which constraints might currently prevent the use
of existing, non-ozone depleting substitutes such as HFC–
245fa. Whether or not the record supports this conclusion, it
was not a departure from any past policy of not approving
ozone-depleters.
Honeywell can fare no better with its other contentions,
although I do not reach the merits of either. The relief
granted by the court eliminates the need to address Honey-
well’s contention that it did not have adequate notice of EPA
final decision. And Honeywell’s contention that the final
13
rule’s delegation of technical feasibility determinations to the
end-user is contrary to CAA § 612(c)’s requirement that the
‘‘Administrator’’ identify substitutes and to EPA’s regulations
defining chemicals as ‘‘potential available’’ if ‘‘the Agency
reasonably believes them to be technically feasible,’’ 40 C.F.R.
§ 82.172 (emphasis added), comes too late. Honeywell waited
to make this argument in its Reply Brief, contending that the
delegation undermines the narrowed use limitations by creat-
ing the risk that end-users will impermissibly consider transi-
tion costs as a basis for determining that switching to ozone-
friendly alternatives is not technically feasible. See Pet.
Reply Brief 2, 12. Although such delegation might present a
potentially serious issue, cf. U.S. Telecom Ass’n v. FCC, 359
F.3d 554, 573–74 (D.C. Cir. 2004), the court has ‘‘repeatedly
held that an argument first made in a reply brief ordinarily
comes too late for our consideration’’ because opposing coun-
sel is denied an opportunity to respond. See Amgen v.
Smith, 357 F.3d 103, 117–18 (D.C. Cir. 2004) (quoting Stu-
dents Against Genocide v. Dep’t of State, 257 F.3d 828, 842
(D.C. Cir. 2001)). Because EPA has had no opportunity to
address the delegation issue, and might promulgate a new
regulation on remand that does not include the narrowed use
limits, its resolution must await another day.