Rocky Mountain Farmers Union v. Richard Corey

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ROCKY MOUNTAIN FARMERS UNION; No. 17-16881

REDWOOD COUNTY MINNESOTA

CORN AND SOYBEAN GROWERS; D.C. Nos.

PENNY NEWMAN GRAIN, INC.; REX 1:09-cv-02234-

NEDEREND; FRESNO COUNTY FARM LJO-BAM

BUREAU; NISEI FARMERS LEAGUE; 1:10-cv-00163-

CALIFORNIA DAIRY CAMPAIGN; LJO-BAM

GROWTH ENERGY,

Plaintiffs-Appellants,

and

AMERICAN FUEL & PETROCHEMICAL

MANUFACTURERS ASSOCIATION,

FKA National Petrochemical &

Refiners Association; AMERICAN

TRUCKINGS ASSOCIATIONS; THE

CONSUMER ENERGY ALLIANCE,

Plaintiffs,

v.

RICHARD W. COREY, in his official

capacity as Executive Officer of the

California Air Resources Board;

ALEXANDER SHERRIFFS; BARBARA

RIORDAN; HECTOR DE LA TORRE;

JOHN EISENHUT; JOHN GIOIA; MARY

D. NICHOLS; RON ROBERTS; DANIEL

2 ROCKY MOUNTAIN FARMERS UNION V. COREY

SPERLING; SANDRA BERG; JOHN R.

BALMES; PHIL SERNA; DEAN

FLOREZ; DIANE TAKVORIAN; JUDY A.

MITCHELL, in their official capacities

as members of the California Air

Resources Board; GAVIN NEWSOM,

in his official capacity as Governor

of the State of California; XAVIER

BECERRA, in his official capacity as

Attorney General of the State of

California,

Defendants-Appellees,

SIERRA CLUB; CONSERVATION LAW

FOUNDATION; ENVIRONMENTAL

DEFENSE FUND; NATURAL

RESOURCES DEFENSE COUNCIL,

Intervenor-Defendants-Appellees.

ROCKY MOUNTAIN FARMERS UNION V. COREY 3

ROCKY MOUNTAIN FARMERS UNION; No. 17-16882

REDWOOD COUNTY MINNESOTA

CORN AND SOYBEAN GROWERS; D.C. Nos.

PENNY NEWMAN GRAIN, INC.; REX 1:09-cv-02234-

NEDEREND; FRESNO COUNTY FARM LJO-BAM

BUREAU; NISEI FARMERS LEAGUE; 1:10-cv-00163-

CALIFORNIA DAIRY CAMPAIGN; LJO-BAM

GROWTH ENERGY,

Plaintiffs,

OPINION

and

AMERICAN FUEL & PETROCHEMICAL

MANUFACTURERS ASSOCIATION,

FKA National Petrochemical &

Refiners Association; AMERICAN

TRUCKINGS ASSOCIATIONS; THE

CONSUMER ENERGY ALLIANCE,

Plaintiffs-Appellants,

v.

RICHARD W. COREY, in his official

capacity as Executive Officer of the

California Air Resources Board;

ALEXANDER SHERRIFFS; BARBARA

RIORDAN; HECTOR DE LA TORRE;

JOHN EISENHUT; JOHN GIOIA; MARY

D. NICHOLS; RON ROBERTS; DANIEL

SPERLING; SANDRA BERG; JOHN R.

BALMES; PHIL SERNA; DEAN

FLOREZ; DIANE TAKVORIAN; JUDY A.

MITCHELL, in their official capacities

as members of the California Air

4 ROCKY MOUNTAIN FARMERS UNION V. COREY

Resources Board; GAVIN NEWSOM,

in his official capacity as Governor

of the State of California; XAVIER

BECERRA, in his official capacity as

Attorney General of the State of

California,

Defendants-Appellees,

SIERRA CLUB; CONSERVATION LAW

FOUNDATION; ENVIRONMENTAL

DEFENSE FUND; NATURAL

RESOURCES DEFENSE COUNCIL,

Intervenor-Defendants-Appellees.

Appeal from the United States District Court

for the Eastern District of California

Lawrence J. O’Neill, Chief Judge, Presiding

Argued and Submitted September 26, 2018

Pasadena, California

Filed January 18, 2019

Before: Dorothy W. Nelson, Ronald M. Gould,

and Mary H. Murguia, Circuit Judges.

Opinion by Judge Gould

ROCKY MOUNTAIN FARMERS UNION V. COREY 5

SUMMARY *

Civil Rights

The panel vacated in part and affirmed in part the district

court’s judgment on the pleadings and Fed. R. Civ. P.

12(b)(6) dismissal of an action alleging that the previous and

current versions of California’s Low Carbon Fuel Standard

violate the Commerce Clause and the “federal structure of

the Constitution.”

Plaintiffs challenged three iterations of California Air

Resources Board regulations aimed at accomplishing the

goal of reducing the rate of greenhouse gas emissions in

California’s transportation sector: (1) the first Low Carbon

Fuel Standard, which went into effect in 2011; (2) the Low

Carbon Fuel Standard, as amended in 2012; and (3) the 2015

Low Carbon Fuel Standard. The 2011 Low Carbon Fuel

Standard established a program for the regulation of

Californian transportation fuels based on a fuels’ “carbon

intensity.” The 2015 Low Carbon Fuel Standard repealed the

2011 Low Carbon Fuel Standard and the 2012 amendments.

The panel held that plaintiffs’ challenges to the 2011 and

2012 versions of the Low Carbon Fuel Standard were made

moot by their repeal. The panel therefore vacated the district

court’s judgment as to those challenges and remanded with

instructions to dismiss those claims.

*

This summary constitutes no part of the opinion of the court. It

has been prepared by court staff for the convenience of the reader.

6 ROCKY MOUNTAIN FARMERS UNION V. COREY

Affirming the district court’s decision as to the claims

challenging the 2015 Low Carbon Fuel Standard, the panel

held that the claims were largely precluded by this Court’s

prior decision in Rocky Mountain Farmers Union v. Corey,

730 F.3d 1070 (9th Cir. 2013). The panel held that,

practically speaking, the controlling substance at the crux of

the case had not changed since 2011. The panel noted that

the 2015 Fuel Standard still uses a lifecycle analysis to

assign credits and deficits, and although some details had

changed, plaintiffs did not and could not explain how their

extraterritoriality claims under the Commerce Clause

functioned differently against the new version of the

regulation.

The panel rejected plaintiffs’ assertion that their claims

were based on the “federal structure of the Constitution” and

therefore were not controlled by Rocky Mountain. The panel

held that plaintiffs had not identified which constitutional

provisions or doctrine outside the Commerce Clause

governed their structural federalism claims. Moreover, the

panel held that it was bound by recent Circuit precedent that

settled whether a program very similar to the Low Carbon

Fuel Standard was inconsistent with the structure of the

Constitution. See Am. Fuel & Petrochemical Mfrs. v.

O’Keeffe, 903 F.3d 903 (9th Cir. 2018). Finally, the panel

rejected plaintiffs’ claim that the 2015 Low Carbon Fuel

Standard facially discriminated against interstate commerce

in its treatment of ethanol and crude oil or that it

purposefully discriminated against out-of-state ethanol.

ROCKY MOUNTAIN FARMERS UNION V. COREY 7

COUNSEL

Paul J. Zidlicky (argued), Clayton G. Northouse, and Erika

L. Maley, Sidney Austin LLP, Washington, D.C.; John C.

O’Quinn, Kirkland & Ellis LLP, Washington, D.C.; John P.

Kinsey and Timothy Jones, Wagner Jones Helsley PC,

Fresno, California; for Plaintiffs-Appellants.

M. Elaine Meckenstock (argued), Jonathan Wiener, and

Myung J. Park, Deputy Attorneys General; Gavin G.

McCabe, Supervising Attorney General; Robert W. Byrne,

Senior Assistant Attorney General; Xavier Becerra,

Attorney General; Office of the Attorney General, Oakland,

California; Sean H. Donahue, Donahue Goldberg & Weaver

LLP, Washington, D.C.; Joanne Spalding, Sierra Club,

Oakland, California; David Pettit, Natural Resources

Defense Council, Santa Monica, California; for Defendants-

Appellees.

OPINION

GOULD, Circuit Judge:

In 2013, we decided the first appeal in a long-running,

complex challenge to California’s Low Carbon Fuel

Standard (LCFS) under the Commerce Clause in Rocky

Mountain Farmers Union v. Corey, rejecting some of

Plaintiffs’ claims and remanding for further proceedings on

others. Rocky Mountain Farmers Union v. Corey, 730 F.3d

1070 (9th Cir. 2013) reh’g en banc denied, 704 F.3d 507 (9th

Cir. 2014), and cert. denied, 134 S. Ct. 2875 (2014)

(hereinafter Rocky Mountain I). That challenge returns to us

today. In the intervening years, the LCFS has been repealed

and replaced, and Plaintiffs’ claims have changed form, but

8 ROCKY MOUNTAIN FARMERS UNION V. COREY

both the regulations and the claims have the same core

structure now as they did then. We hold that Plaintiffs’

challenges to previous versions of the LCFS have been made

moot by their repeal, and we affirm the dismissal of their

remaining claims against the present version of the LCFS as

largely precluded by our prior decision in Rocky Mountain I.

To the extent Plaintiffs raise new arguments on this appeal,

we conclude that they are without merit.

I

A

Since 2006, the California Air Resources Board (CARB)

has acted under a mandate to reduce California’s rate of

greenhouse gas emissions in light of the California

legislature’s finding that “[g]lobal warming poses a serious

threat to the economic well-being, public health, natural

resources, and the environment of California.” Cal. Health

& Safety Code § 38501. The California legislature is rightly

concerned with the health and welfare of humans living in

the State of California. These persons may be subjected, for

example, to crumbling or swamped coastlines, rising water,

or more intense forest fires caused by higher temperatures

and related droughts, all of which many in the scientific

communities believe are caused or intensified by the volume

of greenhouse gas emissions. 1 The California legislators and

1

See generally Intergovernmental Panel on Climate Change, Global

Warming of 1.5 °C (2018), http://www.ipcc.ch/report/sr15/; see also

Coral Davenport, Major Climate Report Describes a Strong Risk of

Crisis as Early as 2040, N.Y. Times (Oct. 7, 2018),

https://www.nytimes.com/2018/10/07/climate/ipcc-climate-report-

2040.html; Seth Bornstein & Frank Jordans, ‘Weirdness Abounds’ as

World Warms; Scientists Say Record Temps, Fires Made Worse by

ROCKY MOUNTAIN FARMERS UNION V. COREY 9

regulators who created the CARB regulation of greenhouse

gas emissions were clearly concerned with such dreadful

environmental impacts. 2 And, whatever else may be said of

the revolutionary colonists who framed our Constitution, it

cannot be doubted that they respected the rights of individual

states to pass laws that protected human welfare, 3 see, e.g.,

The Federalist No. 45 at 289 (James Madison) (Clinton

Rossiter ed., 2003) (“The powers reserved to the several

States will extend to all the objects, which, in the ordinary

course of affairs, concern the lives, liberties, and properties

of the people; and the internal order, improvement, and

Human-Caused Climate Change, Chicago Tribune, Aug. 1, 2018, at

C12.

2

See S. Rules Comm., A. Floor Bill Analysis on A.B. 32, 2005–2006

Leg., Reg. Sess. (Cal. 2006), http://leginfo.legislature.ca.gov/faces/bill

AnalysisClient.xhtml?bill_id=200520060AB32; (discussing passage of

a bill to inter alia authorize CARB to regulate greenhouse gas emissions

from transportation fuels, stating that “global climate change poses a

serious threat to California’s economic well being, public health, and

environment if aggressive actions to reduce GHG emissions are not

taken soon”), Cal. Envtl. Prot. Agency Air Res. Bd., Staff Report:

Initial Statement of Reasons for Proposed Rulemaking – Proposed Re-

Adoption of the Low Carbon Fuel Standard ES-1–2 (Dec. 2014),

https://www.arb.ca.gov/regact/2015/lcfs2015/lcfs15isor.pdf (“The

primary goal of the LCFS regulation is to reduce the carbon intensity of

transportation fuels used in California . . . thereby reducing GHG

emissions . . . .”).

3

Blackstone referred to the traditional authority of the police power

as the power to ensure “the due regulation and domestic order of the

kingdom.” 4 William Blackstone, Commentaries *162. Bentham’s work

on constitutional codes similarly defined the police power as “a system

of precaution, either for the prevention of crimes or of calamities.”

3 Jeremy Bentham, The Works of Jeremy Bentham *169 (John Bowring

ed., 1843) (later cited by Tennessee v. Davis, 100 U.S. 257, 300 (1879)).

We cannot doubt that the calamities considered in this context are a

central concern of the states as they wield this traditional power.

10 ROCKY MOUNTAIN FARMERS UNION V. COREY

prosperity of the State.”), and recognized their broad police

powers to accomplish this goal. See, e.g., Metro. Life Ins.

Co. v. Massachusetts, 471 U.S. 724, 756 (1985) (“The States

traditionally have had great latitude under their police

powers to legislate as ‘to the protection of the lives, limbs,

health, comfort, and quiet of all persons.’” (quoting

Slaughter-House Cases, 83 U.S. 36, 62 (1873))); Lewis v. BT

Inv. Managers, Inc., 447 U.S. 27, 36 (1980) (“[T]he States

retain authority under their general police powers to regulate

matters of ‘legitimate local concern,’ even though interstate

commerce may be affected.”); Huron Portland Cement Co.

v. City of Detroit, 362 U.S. 440, 442 (1960) (“Legislation

designed to free [the air] from pollution . . . clearly falls

within the exercise of even the most traditional concept of

. . . the police power.”).

We are presented with several versions of the challenged

CARB regulations that regulate fuel sales in California. This

case concerns three iterations of CARB regulations aimed at

accomplishing the goal of reducing the rate of greenhouse

gas emissions in California’s transportation sector: (1) the

first LCFS, which went into effect in 2011; (2) the LCFS as

amended in 2012; and (3) and the LCFS which replaced the

first LCFS in 2015.

The function of the 2011 and 2012 versions of the LCFS

was heavily discussed and analyzed in Rocky Mountain I and

no current factual allegations have disturbed our summary of

them. See Rocky Mountain I, 730 F.3d at 1078–86 (9th Cir.

2013). We reaffirm, finding Rocky Mountain I’s conclusions

binding here. Id. at 1106–07.

In brief, the 2011 LCFS established a program for the

regulation of Californian transportation fuels based on the

ROCKY MOUNTAIN FARMERS UNION V. COREY 11

fuels’ “carbon intensity.” 4 See Rocky Mountain I, 730 F.3d

at 1080–81. Parties who sell fuel in California are assessed

for the carbon intensity of those fuels, and parties who fall

below the carbon intensity standard gain tradeable credits

that can be used by parties who are above the carbon

intensity standard to meet their regulatory obligations.

CARB assigns carbon intensity differently for different

kinds of fuels, and the 2012 amendments to the LCFS, while

retaining this basic structure, changed the precise procedure

for assigning carbon intensity values to crude oil.

In 2013, after our decision in Rocky Mountain I, a

decision in California state court based on the state’s

administrative law required CARB to reconsider the LCFS.

See POET, LLC v. CARB, 218 Cal. App. 4th 681, 766–67

(2013) (requiring CARB to “[s]et aside its approval of the

LCFS”). This led to the currently-effective LCFS (the “2015

LCFS”) that repealed the 2011 LCFS and, of course, the

2012 amendments. The method and structure of the 2015

LCFS is identical to the 2011 LCFS, and it still contains the

central carbon intensity and lifecycle analysis elements. The

changes that are material for this appeal are limited to the

4

A fuel’s carbon intensity rating reflects the greenhouse gas

emissions associated with the fuel throughout its total “lifecycle.”

Rather than measuring carbon released during the fuel’s use, the

lifecycle analysis examines the environmental impact of a product

from “cradle to grave” by evaluating the resources consumed and wastes

discharged during the product’s production, distribution, use,

maintenance, and disposal. See generally U.S. Dept. of Energy, Ethanol:

The Complete Energy Lifecycle Picture (March 2007),

https://www1.eere.energy.gov/vehiclesandfuels/pdfs/program/ethanol_

brochure_color.pdf (providing an overview of the lifecycle analysis

model).

12 ROCKY MOUNTAIN FARMERS UNION V. COREY

process for assigning carbon intensity values to non-crude

oil fuels.

The 2011 LCFS gave two different pathways for

regulated parties to have the carbon intensity of their fuels

assessed. Under “Method 1,” CARB provided default values

for different fuels with different production procedures from

different parts of the country and the world. Rocky Mountain

I, 730 F.3d at 1082. Regulated parties could also use

“Method 2,” which provided different options aimed at

giving a more individualized assessment of a fuel’s carbon

intensity. Id. The 2015 LCFS abandons the Method 1

process and assigns an individualized carbon intensity to

each fuel, streamlining the application process for some

conventionally produced fuels that CARB had previous

experience in evaluating. This change means that no part of

the LCFS now refers to particular regions of origin, as the

2011 LCFS had. See Rocky Mountain I, 730 F.3d at 1081–

84.

B

The first version of this case began in 2009 and 2010,

when Plaintiffs-Appellants Rocky Mountain Farmers’

Union et al. (“Rocky Mountain”) and American Fuels &

Petrochemical Manufacturers Association et al. (“American

Fuels”) separately challenged the 2011 LCFS under the

Commerce Clause and the Supremacy Clause, bringing Ex

Parte Young actions against CARB members, California’s

Governor, and California’s Attorney General seeking

declaratory and injunctive relief. Rocky Mountain argued

that the 2011 LCFS was preempted by the Energy

Independence and Security Act of 2007 (EISA), regulated

commerce extraterritorially, unduly burdened interstate

commerce, and discriminated against out-of-state fuel

interests. American Fuels made the same claims and added

ROCKY MOUNTAIN FARMERS UNION V. COREY 13

claims that the 2011 LCFS was preempted by the Energy

Policy Act of 2005 and the federal Renewable Fuels

Standard (RFS).

The district court granted summary judgment to the

plaintiffs on Rocky Mountain and American Fuels’s

Commerce Clause claims and granted Rocky Mountain’s

motion for a preliminary injunction. See Rocky Mountain

Farmers Union v. Goldstene (“Rocky Mountain Ethanol”),

843 F. Supp. 2d 1071, 1090, 1093 (E.D. Cal. 2011); Rocky

Mountain Farmers Union v. Goldstene (“Rocky Mountain

Preemption”), 843 F. Supp. 2d 1042, 1070 (E.D. Cal. 2011);

Rocky Mountain Farmers Union v. Goldstene (“Rocky

Mountain Crude”), Nos. CV-F-09-2234 LJO DLB, CV-F-

10-163 LJO DLB, 2011 WL 6936368, at *12–14 (E.D. Cal.

Dec. 29, 2011). The appeals of these orders were

consolidated and heard by the Ninth Circuit in Rocky

Mountain I. 730 F.3d at 1078.

In Rocky Mountain I, we reversed the district court,

holding that the 2011 LCFS did not facially discriminate

against interstate commerce in ethanol or crude oil, did not

regulate extraterritorially, and did not discriminate in

purpose or effect against crude oil. Id. at 1100, 1103–04,

1107. We also held that the LCFS permissibly regulated the

in-state behavior of selling different mixtures of fuel, and

that the use of lifecycle analysis did not amount to

discrimination against interstate commerce because it

disincentivized the purchase of a fuel only to the extent that

that fuel was relevantly different with respect to California’s

legitimate interest in curbing greenhouse gas emissions and

climate change. Id. at 1089–90. Plaintiffs’ petition for

rehearing en banc was denied, 704 F.3d 507 (9th Cir. 2014),

as were petitions for a writ of certiorari from both Plaintiffs

14 ROCKY MOUNTAIN FARMERS UNION V. COREY

and Defendants. See 134 S. Ct. 2875 (2014); Corey v. Rocky

Mountain Farmers Union, 134 S. Ct. 2884 (2014).

Our panel remanded on the following issues: (1) whether

the 2011 LCFS ethanol provisions discriminate in purpose

or in effect, (2) whether the 2011 LCFS ethanol provisions

unduly burden interstate commerce under Pike v. Bruce

Church, Inc., 397 U.S. 137 (1970), (3) whether the 2011 and

2012 LCFS crude oil provisions unduly burden interstate

commerce under Pike, (4) whether the LCFS is preempted

by the federal RFS and (5) whether the LCFS is preempted

by the federal EISA. Rocky Mountain I, 730 F.3d at 1107;

see also Rocky Mountain Farmers Union v. Goldstene, Nos.

1:09-cv-2234-LJO-BAM, 1:10-cv-163-LJO-BAM, 2014

WL 7004725, at *6 (E.D. Cal. Dec. 11, 2014) (hereinafter

Goldstene) (summarizing the questions the district court

received on remand).

C

On remand, Plaintiffs’ claims went through a series of

amendments and decisions to reach their current form. In

December of 2014, the district court granted in part a motion

to amend American Fuels’s complaint. This amendment

resulted in a complaint that also challenged the 2012

amendments to the LCFS’s crude oil provisions, added a

“horizontal federalism” aspect to its extraterritoriality claim,

and eliminated American Fuels’s Pike and federal

preemption claims. See Goldstene, 2014 WL 7004725, at

*18.

The district court then further clarified its position by

granting summary judgment for Defendants on Plaintiffs’

extraterritoriality claim against the original LCFS, granting

a motion to dismiss on Plaintiffs’ extraterritoriality claim

against the 2012 version of the LCFS, granting summary

ROCKY MOUNTAIN FARMERS UNION V. COREY 15

judgment for Defendants on Plaintiffs’ facial discrimination

claims against the original LCFS with respect to ethanol,

granting summary judgment for Defendants on all of

Plaintiffs’ discrimination claims against the original LCFS

and the 2012 version with respect to crude oil, and denying

a motion to dismiss Plaintiffs’ claim that the original ethanol

provisions discriminate in purpose and effect. Am. Fuels &

Petrochemical Mfrs. Ass’n v. Corey, Nos. 1:09-cv-2234-

LJO-BAM, 1:10-cv-163-LJO-BAM, 2015 WL 5096279, at

*38–39 (Aug. 28, 2015).

The complaints were amended again to reflect the 2015

version of the LCFS, and the district court heard motions to

dismiss and motions for judgment on the pleadings. The

amended complaints alleged that all three versions of the

LCFS are preempted by federal law, that all three versions

are impermissible extraterritorial regulations, and that all

three versions violate the Commerce Clause facially, in

purpose and effect, and under the Pike balancing test, which

remained in issue under the claims of Rocky Mountain

despite prior dismissal in the American Fuels case. The

district court held that Plaintiffs’ claims against the repealed

versions of the LCFS were not moot. Nevertheless, it

granted Federal Rule of Civil Procedure 12(c) motions for

judgment on the claims precluded by Rocky Mountain I and

granted 12(b)(6) motions to dismiss on most of the other

claims. The court denied the motions to dismiss on

Plaintiffs’ claims that the ethanol provisions of the 2011 and

2015 versions of the LCFS discriminate in practical effect

and that they violate Pike. Rather than contest these

remaining claims, Plaintiffs voluntarily dismissed them, and

the district court entered a final judgment.

Plaintiffs now appeal the district court’s decision on

claims challenging the 2015 version of the LCFS, as well as

16 ROCKY MOUNTAIN FARMERS UNION V. COREY

previous orders deciding the prior motions to dismiss.

Appellants claim that all three versions of the LCFS violate

the following constitutional protections:

the Commerce Clause and “the federal structure of

the Constitution” by regulating extraterritorially.

the Commerce Clause by facially discriminating

against interstate and foreign commerce in their

treatment of crude oil and ethanol.

the Commerce Clause by purposefully

discriminating against interstate and foreign

commerce in their treatment of crude oil and ethanol.

II

We review legal conclusions concerning mootness de

novo and factual findings concerning mootness for clear

error. In re Thorpe Insulation Co., 677 F.3d 869, 879 (9th

Cir. 2012). We review a district court’s dismissal of a

complaint under Federal Rule of Civil Procedure 12(b)(6) de

novo. United States v. Corinthian Colleges, 655 F.3d 984,

991 (9th Cir. 2011). We review a district court’s entry of

judgment under Federal Rule of Civil Procedure 12(c) de

novo. Yakima Valley Mem’l Hosp. v. Washington State

Dept. of Health, 654 F.3d 919, 925 (9th Cir. 2011).

III

First we examine whether Plaintiffs’ claims against the

repealed 2011 and 2012 versions of the LCFS are moot. The

district court held that, in light of a discussion of mootness

in a footnote in Rocky Mountain I, the repeal or amendment

of older versions of the LCFS did not render Plaintiffs’

claims against those regulations moot. Whatever the status

ROCKY MOUNTAIN FARMERS UNION V. COREY 17

of Plaintiffs’ claims in 2013, we now hold that no effective

relief can be provided for these claims, and that they are now

moot. We vacate the district court’s judgment on them and

remand with directions to dismiss them as moot.

As noted in Rocky Mountain I, a case is moot “only when

it is impossible for a court to grant any effectual relief.”

Rocky Mountain I, 730 F.3d at 1097 n.12 (quoting Decker v.

Nw. Envtl. Def. Ctr., 568 U.S. 597, 609 (2013)). However,

“the Supreme Court and our court have repeatedly held that

a case is moot when the challenged statute is repealed,

expires, or is amended to remove the challenged language.”

Log Cabin Republicans v. United States, 658 F.3d 1162,

1166 (9th Cir. 2011). Where there is nothing left of a

challenged law to enjoin or declare illegal, further judicial

action would necessarily be advisory and in violation of the

limitations of Article III. See, e.g., id. at 1165–66

(describing this doctrine as arising out of the case or

controversy requirements of Article III); Students for a

Conservative America v. Greenwood, 378 F.3d 1129, 1131

(9th Cir. 2004) (“This case is moot . . . because the

challenged rules have been changed and will not apply in

future elections.”); Native Vill. of Noatak v. Blatchford, 38

F.3d 1505, 1514 (9th Cir. 1994) (“Declaratory relief is

unavailable where [a] claim is otherwise moot . . . .”). To

test whether subsequent developments have mooted a suit,

we ask whether the claim could have been brought “in light

of the . . . statute as it now stands.” Hall v. Beals, 396 U.S.

45, 48 (1969).

Plaintiffs’ claims arising from the 2011 and 2012

versions of the LCFS fail this test. The laws challenged are

no longer in effect, Plaintiffs’ obligations under them have

been discharged, and it is not possible for the Court to grant

any effectual relief, as the 2011 and 2012 versions of the

18 ROCKY MOUNTAIN FARMERS UNION V. COREY

LCFS have been repealed. As such, Plaintiffs are in the same

boat as the plaintiffs in Log Cabin Republicans, in which we

said that “[i]f Log Cabin filed suit today seeking a

declaration that section 654 is unconstitutional or an

injunction against its application (or both), there would be

no Article III controversy because there is no section 654.”

658 F.3d at 1166.

Rocky Mountain I did not hold otherwise when it briefly

considered whether the 2012 amendments had made the

Plaintiffs’ 2013 challenge to the crude oil provisions of the

2011 LCFS moot. The court held that the amendments had

not mooted Plaintiffs’ claims, because “[c]redits awarded

based on [carbon intensity values calculated under the

challenged 2011 Provisions] will carry forward to

subsequent years and may be used by a regulated party” and

“[t]he propriety of the scheme under which those credits

were distributed remains a live controversy.” Rocky

Mountain I, 730 F.3d at 1097 n.12. This statement reflected

the fact that, as we were deciding this issue, the 2011 LCFS,

as partially amended in 2012, was good law and could have

been subject to any number of declaratory or injunctive

remedies. Although it is true that credits awarded under

prior versions of the LCFS could have future effects, it is no

longer true that the scheme under which those credits were

distributed remains a live controversy and challenges to it

can no longer be brought, as the 2011 and 2012 versions

have been repealed. If the present LCFS inherited any

constitutional infirmities from its predecessor, these must be

part of Plaintiffs’ challenge to the law as it currently stands.

Plaintiffs argued to the district court that they could seek

“the adjustment of the carry-forward credits calculated under

the prior version of the LCFS” as a remedy to save these

challenges from mootness. For good reason, Plaintiffs have

ROCKY MOUNTAIN FARMERS UNION V. COREY 19

since abandoned this claim. As the district court correctly

held, any such remedy would be barred for Plaintiff

associations by a lack of associational standing, and barred

for all Plaintiffs by the Eleventh Amendment. In order to try

to compensate parties for unconstitutionally low credits or

unconstitutionally high deficits awarded under prior

versions of the LCFS, the court would have to determine

how each party changed its behavior in response and how

much those changes cost each party, determinations that

would be impossible without “the participation of individual

members in the lawsuit.” United Food & Commercial

Workers Union Local 751 v. Brown Group, Inc., 517 U.S.

544, 553 (1996) (quoting Hunt v. Wash. State Apple Advert.

Com’n, 432 U.S. 333, 343 (1977)). Moreover, any such

relief could only be compensation for a state’s past violation

of law, which is barred by the Eleventh Amendment. See

Pennhurst State School & Hospital v. Halderman, 465 U.S.

89, 105–06 (1984) (“[A]n award of retroactive relief

necessarily falls afoul of the Eleventh Amendment.”); see

also Porter v. Jones, 319 F.3d 483, 491 n.7 (9th Cir. 2003)

(“[P]laintiff may not couch in terms of injunctive and

declaratory relief a compensatory, backward-looking

remedy.”). 5

The district court’s judgment on all of Plaintiffs’

challenges to the 2011 and 2012 versions of the LCFS is

VACATED with instructions to DISMISS those claims on

remand. See Log Cabin Republicans, 658 F.3d at 1167

(citing United States v. Munsingwear, Inc., 340 U.S. 36, 39

5

Assuming for sake of argument that we are incorrect in our

conclusion on mootness, and that the challenges by Plaintiffs to the 2011

and 2012 versions of the LCFS are not moot, then we would affirm as

against those challenges for the reasons stated by the majority in Rocky

Mountain I.

20 ROCKY MOUNTAIN FARMERS UNION V. COREY

(1950)) (describing this procedure as “the ‘established’

practice”).

IV

Plaintiffs assert that the 2015 LCFS regulates

extraterritorially, having amended their claims to include the

2015 LCFS and an allegation that the LCFS violates the

federal structure of the Constitution in addition to the

Commerce Clause. The district court granted Defendants’

motion to dismiss on the basis that this claim is precluded by

Rocky Mountain I. Plaintiffs contend that their appeals in

the current case include a claim based on the federal

structure of the Constitution that was not decided in Rocky

Mountain I. We hold that Plaintiffs’ extraterritoriality

claims against the 2015 LCFS are precluded by the law of

the case and by our recent circuit precedent in Am. Fuel &

Petrochemical Mfrs. v. O’Keeffe, 903 F.3d 903 (9th Cir.

2018) (hereinafter O’Keeffe). 6

A

The law of the case doctrine generally precludes

reconsideration of “an issue that has already been decided by

the same court, or a higher court in the identical case.”

United States v. Alexander, 106 F.3d 874, 876 (9th Cir.

1997) (quoting Thomas v. Bible, 983 F.2d 152, 154 (9th Cir.

1993)). In a circumstance like this, “a judgment of reversal

6

On September 12, 2018, the Plaintiffs-Appellants filed a Motion

to Dispense with Oral Argument, asserting that argument was not needed

because to the extent the appeal raised issues not governed by the rulings

in Rocky Mountain I, O’Keeffe resolved those issues. Plaintiffs said they

disagreed with that ruling, but that it was binding on the court in this

case. Our panel denied the motion on September 14, 2018, and we

address all pertinent issues in this opinion.

ROCKY MOUNTAIN FARMERS UNION V. COREY 21

by an appellate court is an adjudication only of matters

expressly discussed and decided, which become the law of

the case in further proceedings on remand and re-appeal.”

Hansen & Rowland v. C.F. Lytle Co., 167 F.2d 998, 999 (9th

Cir. 1948). To show that an issue is not controlled by the

law of the case, parties must show that it was not “decided

explicitly or by necessary implication” by a prior decision.

United States v. Garvia-Beltran, 443 F.3d 1126, 1129 (9th

Cir. 2006) (quoting Liberty Mut. Ins. Co. v. EEOC, 691 F.2d

438, 441 (9th Cir. 1982)). As a prudential rather than

jurisdictional doctrine, the law of the case doctrine does not

apply “if the court is convinced that its prior decision is

clearly erroneous and would work a manifest injustice.”

Pepper v. United States, 562 U.S. 476, 506–07 (2011)

(internal quotation marks and brackets omitted) (quoting

Agostini v. Felton, 521 U.S. 203, 236 (1997)).

Rocky Mountain I expressly decided Plaintiffs’

extraterritoriality claims against the 2011 and 2012 versions

of the LCFS. Because these claims are now moot, the only

extraterritoriality claims remaining are those against the

2015 LCFS. Strictly speaking, Rocky Mountain I did not,

for obvious reasons, address any claims Plaintiffs may have

had against the 2015 LCFS. Practically speaking, however,

the controlling substance at the crux of the case has not

changed. The 2015 LCFS still uses lifecycle analysis to

assign credits and deficits, and although some details have

changed, Plaintiffs do not and cannot explain how their

extraterritoriality claims under the Commerce Clause

function differently against the new version of the

regulation. Moreover, by deciding that California’s use of

lifecycle analysis “does not control the production or sale”

of out-of-state fuel and that “California may regulate with

reference to local harms, structuring its internal markets to

set incentives for firms to produce less harmful products for

22 ROCKY MOUNTAIN FARMERS UNION V. COREY

sale in California,” Rocky Mountain I necessarily implied

that an extraterritoriality challenge to a functionally identical

regulation would fail. Rocky Mountain I, 730 F.3d at 1104.

We are not convinced that our decision in Rocky

Mountain I is “clearly erroneous” such that its application

“would work a manifest injustice.” Pepper, 562 U.S. at 506–

07. Rocky Mountain I examined the LCFS under the test

provided by Healy, which holds that a regulation is

impermissibly extraterritorial when “the practical effect of

the regulation is to control conduct beyond the boundary of

the state.” Rocky Mountain I, 730 F.3d at 1101 (citing Healy

v. Beer Inst., 491 U.S. 324, 336 (1989)). By holding that

California may “regulate with reference to local harms,

structuring its internal markets to set incentives for firms to

produce less harmful products for sale in California,” Rocky

Mountain I properly respected the separate sovereignty of

the several states. Id. at 1104.

Rocky Mountain I followed a well-worn path of

precedent. States may seek to influence which products are

sold in-state, distinguishing impermissible statutes that

“regulate out-of-state parties directly” from those that

“regulate[] contractual relationships in which at least one

party is located in [the regulating state].” Gravquick A/S v.

Trimble Navigation Int’l Ltd., 323 F.3d 1219, 1224 (9th Cir.

2003). This is true even where the characteristics of the

products at market are not at issue. See Ass’n des Eleveurs

de Canards et d'Oies du Quebec v. Harris, 729 F.3d 937,

947–52 (9th Cir. 2013) (holding that a ban on selling foie

gras created by force-feeding did not discriminate against or

regulate out-of-state commerce); Pharm. Research & Mfrs.

of Am. v. Walsh, 538 U.S. 644, 669 (2003) (holding that

Maine may impose regulatory burdens on drug

manufacturers who do not have a rebate agreement with the

ROCKY MOUNTAIN FARMERS UNION V. COREY 23

state). The Commerce Clause also does not treat regulations

that have upstream effects on how sellers who sell to

California buyers produce their goods as being necessarily

extraterritorial. See Minnesota v. Clover Leaf Creamery Co.,

449 U.S. 456, 472 (1981); Exxon Corp. v. Maryland,

437 U.S. 117, 125–28 (1978). And as C&A Carbone, Inc. v.

Town of Clarkstown emphasized, local governments are

empowered to issue “uniform safety regulations” which

“would ensure that competitors . . . do not underprice the

market by cutting corners on environmental safety.”

511 U.S. 383, 393 (1994). In other words, subjecting both

in and out-of-jurisdiction entities to the same regulatory

scheme to make sure that out-of-jurisdiction entities are

subject to consistent environmental standards is a traditional

use of the State’s police power; it is not an extension of

“police power beyond its jurisdictional bounds.” Id. The

LCFS helps California and its citizens by ensuring that out-

of-state fuels do not benefit in Californian markets by

“cutting corners” and not being subject to California’s

regulations on the resulting greenhouse gases.

Rocky Mountain I reflects the commonplace proposition

that states may regulate to minimize the in-state harm caused

by products sold in-state, a central aspect of the state

sovereignty protected by the Constitution. See Clover Leaf

Creamery Co., 449 U.S. at 471–74; Sam Francis Found. v.

Christies, Inc., 784 F.3d 1320, 1324 (9th Cir. 2015) (en

banc) (commenting that Rocky Mountain I “concerned state

law[] that regulated in-state conduct with allegedly

significant out-of-state practical effects”); Brannon P.

Denning, Extraterritoriality and the Dormant Commerce

Clause: A Doctrinal Post-Mortem, 73 La. L. Rev. 979, 998–

99 (2013) (noting that a contrary expansive view of the

Healy doctrine “could have become a significant restriction

on state regulatory power” if the Court had adopted it). The

24 ROCKY MOUNTAIN FARMERS UNION V. COREY

LCFS does this without crossing into impermissible inter-

state regulation. See Edgar v. MITE Corp., 457 U.S. 624,

642–43 (1982) (holding an state statute conflicted with the

Commerce Clause because it regulated transactions in other

states); Nat’l Solid Wastes Mgmt. Ass’n v. Meyer, 63 F.3d

652, 653–54 (7th Cir. 1995) (holding a state statute violated

the Commerce Clause because it effectively required other

states to adopt similar regulations); Healy, 491 U.S. at 331–

39 (holding that a state statute violated the Commerce

Clause because it had the practical effect of establishing

scale of prices for use in other states); Brown-Forman

Distillers Corp. v. New York State Liquor Authority,

476 U.S. 573 (1986) (same); Baldwin v. G.A.F. Seelig, Inc.,

294 U.S. 511, 521 (1935) (same).

Finally, we squarely reject Plaintiff-Appellants’

arguments that California’s interest in the LCFS is merely a

concern for the environmental harms that are properly

subject to the police power of other states rather than of

California. As we held in Rocky Mountain I, the LCFS was

enacted pursuant to California’s view that “[g]lobal warming

poses a serious threat to the economic well-being, public

health, natural resources, and the environment of

California.” Cal. Health & Safety Code § 38501(a).

California did not enact the LCFS because it thinks that it is

the state that knows how best to protect Iowa’s farms,

Maine’s fisheries, or Michigan’s lakes. California’s interest

in the lifecycle of the fuels used by its consumers arises from

a concern for the effects of the production and use of these

fuels on California’s own air quality, snowpack, and

coastline. Here, the regulated parties, the regulated

transactions, and the harms California intended to prevent

are all within the state’s borders, making the LCFS a classic

exercise of police power. We cannot say that California is

doing anything other than legislating “with reference to its

ROCKY MOUNTAIN FARMERS UNION V. COREY 25

own jurisdiction” in promulgating the LCFS. Bonaparte v.

Appeal Tax Court of Balt., 104 U.S. 592, 594 (1881).

B

Having previously lost on their Commerce Clause

argument in Rocky Mountain I, Plaintiffs now advance their

new constitutional argument, contending that their claims

are based on the “federal structure of the Constitution” and

are not controlled by Rocky Mountain I. Plaintiffs have not

identified which constitutional provisions or doctrine

outside the Commerce Clause they believe govern their

structural federalism claims, if any do. However, our panel

need not linger on whether the Constitution could support

such a claim, because we are bound by recent circuit

precedent that has settled whether a program very similar to

the LCFS is inconsistent with the structure of the

Constitution. See O’Keeffe, 903 F.3d at 916–17. The

O’Keeffe court held that “irrespective of its constitutional

basis, any such claim is necessarily contingent upon a

finding that the [regulating state’s] program regulates and

attempts to control conduct that occurs in other states.” Id.

(quoting Goldstene, 2014 WL 7004725, at *13–14). As

discussed above, we settled this precise question for the

LCFS in Rocky Mountain I, and O’Keeffe is not materially

distinguishable from our current case.

There is simply no reason to search beyond the

Commerce Clause for the Constitution’s limits on the ability

of states to affect interstate commerce. While the Supreme

Court has frequently instructed us on the general principles

that “all States enjoy equal sovereignty,” Shelby County,

Ala. v. Holder, 570 U.S. 529, 534 (2013), and that states may

not “regulate and control activities wholly beyond [their]

boundaries,” Watson v. Emp’rs Liab. Assurance Corp.,

348 U.S. 66, 70 (1954), Commerce Clause jurisprudence is

26 ROCKY MOUNTAIN FARMERS UNION V. COREY

the relevant application of those general principles to this

context. The states, in forming the Union, “reserve[d] . . . a

substantial portion of the Nation’s primary sovereignty,”

and, because of this, constitutional restrictions on the police

power of the states should not be lightly inferred. Alden v.

Maine, 527 U.S. 706, 714 (1999). Our federalism doctrine

already has one “quagmire” of doctrine, independent of the

constitutional text, concerned with the effects of state

regulation on interstate commerce. West Lynn Creamery v.

Healy, 512 U.S. 186, 210 (1994) (Scalia, J., concurring). We

should decline to create another.

The district court’s decision as to Plaintiffs’

extraterritoriality claims against the 2015 LCFS is

AFFIRMED.

V

Plaintiffs contend for a second time that the LCFS

facially discriminates against interstate commerce in its

treatment of ethanol and crude oil, having amended their

claims to include the 2015 LCFS. The district court

concluded that Plaintiffs’ claims against the 2015 LCFS

should be dismissed based on Rocky Mountain I, and we

agree.

Rocky Mountain I rejected facial discrimination

challenges to the 2011 LCFS, holding that the “lifecycle

analysis used by CARB, including the specific factors to

which Plaintiffs object, does not discriminate against out-of-

state commerce” and that CARB’s decision to distinguish

between different fuels reflected its “expert regulatory

judgment” in aiming to produce “accurate carbon intensity

values.” 730 F.3d at 1093, 1096. These features remain in

the 2015 LCFS, and rather than contending that the new law

discriminates in some different way, Plaintiffs concede that

ROCKY MOUNTAIN FARMERS UNION V. COREY 27

their facial discrimination challenges are based on the same

premises. In fact, these claims have only been weakened by

intervening regulatory developments. The original LCFS

appealed to default pathways with regional characteristics,

which were a major source of the facial discrimination

claims in Rocky Mountain I. See id. at 1096. The 2015

LCFS eliminates the regional pathways and gives every

alternative fuel an individualized assessment, making no

default assumptions based on region of origin. 2015 LCFS

§ 95488(b), (c). It is not surprising then that Plaintiffs

concede that their facial discrimination claims are controlled

by Rocky Mountain I.

Because ruling in favor of Plaintiffs on their facial

discrimination claim would require rejecting Rocky

Mountain I on issues it expressly reached and decided, the

law of the case prevents us from endorsing Plaintiffs’ claims

against the 2015 LCFS unless we believe that “[our] prior

decision is clearly erroneous and would work a manifest

injustice.” Pepper, 562 U.S. at 506–07. As we do not, we

affirm the district court’s dismissal.

As Rocky Mountain I reflects, the Commerce Clause

respects both the concerns of the national marketplace and

the central value of local autonomy in our federal system.

See Rocky Mountain I, 730 F.3d at 1087. These principles

require us to take into account the potential indirect effects

of a state’s regulation of in-state activities insofar as they

may affect out-of-state commerce. However, the lens

through which we view this analysis must reflect the fact that

a state’s ability to control its internal markets and combat

local harms is squarely within its traditional police power.

Our Commerce Clause jurisprudence reflects the fact that

“the Framers’ distrust of economic Balkanization was

limited by their federalism favoring a degree of local

28 ROCKY MOUNTAIN FARMERS UNION V. COREY

autonomy.” Dep’t of Revenue of Ky. v. Davis, 553 U.S. 328,

338 (2008) (examining the history and rationale for the

Commerce Clause). Rocky Mountain I was correct to hold

that the LCFS was permissible local regulation under this

balance of considerations.

State autonomy in the regulation of economic and social

affairs is central to our system because of the recognized role

states have as laboratories, trying “novel social and

economic experiments without risk to the rest of the

country.” Rocky Mountain I, 730 F.3d at 1087 (citing New

State Ice Co. v. Liebmann, 285 U.S. 262, 311 (1932)

(Brandeis, J., dissenting)); see also Reeves, Inc. v. Stake,

447 U.S. 429, 441 (1980) (arguing that in light of State

experimentation in policy “[a] healthy regard for federalism

and good government renders us reluctant” to strike down a

state program under the dormant Commerce Clause).

Because any meaningful regulation of in-state commerce

may have indirect but significant interstate impacts, we

should be reluctant to subject states to unwarranted scrutiny

under the Commerce Clause for fear that we will frustrate

“the theory and utility of our federalism” by restricting the

ability of the states to “perform their role as laboratories for

experimentation . . . where the best solution is far from

clear.” United States v. Lopez, 514 U.S. 549, 581 (1995)

(Kennedy, J., concurring).

California has attempted to address a vitally important

environmental issue with vast potential consequences.

O’Keeffe, 903 F.3d at 913 (citing Massachusetts v. EPA,

549 U.S. 497, 522–23 (2007)) (recognizing that “[i]t is well

settled that states have a legitimate interest in combating the

adverse effects of climate change on their residents.”). It

seems clear beyond dispute that potential climate change

poses one of the most difficult challenges facing all

ROCKY MOUNTAIN FARMERS UNION V. COREY 29

civilizations worldwide for the twenty-first century. By

recognizing emissions that occur throughout the lifecycle of

different fuels, California has offered a potential solution to

the perverse incentives that would otherwise undermine any

attempt to assess and regulate the carbon impact of different

fuels. See Rocky Mountain I, 730 F.3d 1081. This

experiment cannot succeed without the ability to

differentiate the different production processes and power

generation that are used to produce those fuels. Moreover,

the value of California’s experimentation is reinforced by the

fact that other states can and will follow suit by using any

lawful procedure that proves effective as a model. That is

what happened in the Oregon Clean Fuels Program. Id. at

907–10.

The Constitution does not require California to shut its

eyes to the fact that some ethanol is produced with coal and

other ethanol is produced with natural gas because these

kinds of energy production are not evenly dispersed across

the country or because other states have not chosen to

regulate the production of greenhouse gases. If the states are

to remain a source of “innovative and far-reaching statutes”

that “supplemen[t] national standards,” they must be

permitted to submit the goods and services sold within their

borders to certain environmental standards without having

thereby discriminated against interstate commerce from

states with lower local standards. FERC v. Mississippi, 456

U.S. 742, 789 (1982) (O’Connor, J., concurring in part and

dissenting in part).

The district court’s decision as to Plaintiffs’ facial

discrimination claims against the 2015 LCFS is

AFFIRMED.

30 ROCKY MOUNTAIN FARMERS UNION V. COREY

VI

We previously remanded to the district court in Rocky

Mountain I on the Plaintiffs’ claim that the LCFS

purposefully discriminates against out-of-state ethanol. The

district court dismissed this claim, finding that “Plaintiffs

ma[de] no meaningful effort to differentiate the factual and

legal bases of their claims concerning the Original LCFS’s

ethanol provisions . . . and the bases of their pending claim

that the 2015 LCFS’s ethanol provisions have a

discriminatory purpose.” We agree and affirm.

In Rocky Mountain I, we left open the possibility that

Plaintiffs might have been able to show that the LCFS’s

treatment of carbon intensity, although it reflected facially

permissible differences between different kinds of fuels, was

actually enacted to prop up local fuel interests. Rather than

take advantage of the opportunity to develop this claim on

remand, however, Plaintiffs rely on the same basic set of

facts and alleged statements of bias that we heard in Rocky

Mountain I. As the district court found, “Plaintiffs have not

pointed to any portion of the LCFS’s legislative history that

the Ninth Circuit did not consider.”

Although we declined to foreclose Plaintiffs’ purposeful

discrimination claim, the district court is correct that “the

logic and record underlying all of Plaintiffs’ claims against

the ethanol provisions . . . has not changed.” The only new

material is a 2009 CARB press release that the district court

correctly held was a permissible “economic defense of a

[regulation] genuinely proposed for environmental reasons.”

Rocky Mountain I, 730 F.3d at 1100 n.13 (citing Minnesota

v. Clover Leaf Creamery Co., 449 U.S. 456, 463 n.7 (1981)

(“We will not invalidate a state statute under the Equal

Protection Clause merely because some legislators sought to

ROCKY MOUNTAIN FARMERS UNION V. COREY 31

obtain votes for the measure on the basis of its beneficial side

effects on state industry.”)).

As we noted in Rocky Mountain I, “[t]he party

challenging a regulation bears the burden of establishing that

a challenged regulation has a discriminatory purpose or

effect under the Commerce Clause.” 730 F.3d at 1097 (citing

Hughes v. Oklahoma, 441 U.S. 322, 336 (1979)). This

burden is all that much higher to meet in the face of our

holding that the structure of the LCFS does not show

evidence of discrimination. Under the LCFS, the relative

fate of in-state and out-of-state entities depends entirely on

the environmental properties of different fuel production and

transport processes. If the Midwest were to undergo a green

revolution in its energy production, the LCFS would act as a

competitive drag on California energy producers. In fact,

Rocky Mountain I recognized that it had already done so with

respect to portions of the market. See, e.g., Rocky Mountain

I, 730 F.3d at 1084 (“The individualized pathway with the

lowest carbon intensity was achieved by a Midwest producer

. . .[and] [t]he default pathway with the lowest carbon

intensity is . . . for Brazilian sugarcane ethanol . . . .”).

In light of these facts about the LCFS’s design, Plaintiffs

do not meet their burden of showing a discriminatory

purpose. Plaintiffs do not advance any evidence concerning

the purpose of the new regulation, the only law now subject

to challenge. Plaintiffs’ arguments rely primarily on

California’s motivations for passing the different versions of

the LCFS that were applicable in 2009 and 2010. This is

fatal to their case. In both its design and its legislative

justifications, the LCFS is a regulation aimed at salient

environmental differences between different types of fuels,

differences which genuinely reflect legitimate state interests.

We reject the bald suggestion that the California LCFS is

32 ROCKY MOUNTAIN FARMERS UNION V. COREY

disguised economic protectionism. Instead, we reaffirm the

conclusions that were set forth in part VI of Rocky Mountain

I because those conclusions remain pertinent to the claims

now presented:

The California legislature has determined

that the state faces tremendous risks from

climate change. With its long coastlines

vulnerable to rising waters, large population

that needs food and water, sizable deserts that

can expand with sustained increased heat,

and vast forests that may become tinderboxes

with too little rain, California is uniquely

vulnerable to the perils of global warming.

The California legislature determined that

GHG emissions from the production and

distribution of transportation fuels contribute

to this risk, and that those emissions are

caused by the in-state consumption of fuels.

Whether or not one agrees with the science

underlying those views, those determinations

are permissible ones for the legislature to

make, and the Supreme Court has recognized

that these risks constitute local threats. See

Massachusetts, 549 U.S. at 522.

To combat these risks, the California

legislature and its regulatory arm CARB

chose to institute a market-based solution that

recognizes the costs of harmful carbon

emissions. For any such system to work, two

conditions must be met. First, the market

must have full and accurate information

about the real extent of GHG emissions.

Second, the compliance costs of entering the

ROCKY MOUNTAIN FARMERS UNION V. COREY 33

market must not be so great as to prevent

participation. Plaintiffs attack the lifecycle

analysis and default pathways that fulfill

these conditions, relying on archaic

formalism to prevent action against a new

type of harm. It has been sagely observed by

Justice Jackson that the constitutional Bill of

Rights is not a “suicide pact.” See

Terminiello v. City of Chicago, 337 U.S. 1,

37 (1949) (Jackson, J., dissenting). Nor is the

dormant Commerce Clause a blindfold. It

does not invalidate by strict scrutiny state

laws or regulations that incorporate state

boundaries for good and non-discriminatory

reason. It does not require that reality be

ignored in lawmaking.

California should be encouraged to

continue and to expand its efforts to find

a workable solution to lower carbon

emissions, or to slow their rise. If no such

solution is found, California residents

and people worldwide will suffer great

harm. We will not at the outset block

California from developing this innovative,

nondiscriminatory regulation to impede

global warming. If the Fuel Standard works,

encouraging the development of alternative

fuels by those who would like to reach the

California market, it will help ease

California's climate risks and inform other

states as they attempt to confront similar

challenges.

730 F.3d at 1106–07.

34 ROCKY MOUNTAIN FARMERS UNION V. COREY

These potential risks to the people living in California

have only intensified in the past several years. Consider that

in the past year California saw its forest fires threat increase

in scope, intensity, duration, and damages, caused in part by

the extensive droughts throughout the state. See, e.g.,

Madison Park, California Fire Explodes in Size, Is

Now Largest in State History, CNN.com (Aug. 7,

2018), https://www.cnn.com/2018/08/06/us/california-fires/

index.html. California also saw more powerful storms

hitting its coastlines. See, e.g., Rong-Gong Lin II, Hurricane

Rosa Poses Risk of Flash Floods to Eastern California,

Las Vegas, Arizona, LATimes.com (Sep. 29, 2018),

http://www.latimes.com/local/lanow/la-me-ln-rain-20180929-

story.html.

The district court’s decision as to Plaintiffs’ purpose and

effect discrimination claims against the 2015 LCFS is

AFFIRMED.

VII

The district court’s decision as to the Plaintiffs’

challenges to the 2015 LCFS is AFFIRMED. We

VACATE its judgment as to the challenges to the 2011 and

2012 versions of the LCFS and REMAND with instructions

to dismiss them as moot.

Costs are awarded to the Defendants.